In the second quarter of 2014, Trinity’s Rail Group reported record revenues of $895.6 million and a record operating profit of $176.0 million, resulting in increases compared to the second quarter of 2013 of 34% and 63%, respectively. The Group shipped 7,160 railcars and received orders for 9,880 railcars during the second quarter. The backlog increased to a record $5.5 billion at June 30, 2014, representing a record 45,350 railcars, compared to a backlog of $5.2 billion as of March 31, 2014, representing 42,630 railcars.
Trinity’s Railcar Leasing and Management Services Group reported revenues of $231.5 million, compared to revenues of $169.6 million during the second quarter of 2013. Operating profit for this Group was $102.4 million in the second quarter of 2014 compared to an operating profit of $75.7 million in the second quarter of 2013. The increase in revenues and operating profit was due to higher rental rates and utilization, lease fleet additions, and increased railcar sales from the lease fleet. During the second quarter, Trinity sold $121.4 million worth of railcars to Element Financial Corp.under the program agreement announced in December 2013, with $53.5 million reported as sales of railcars owned one year or less at the time of sale and $67.9 million reported as sales from the Rail Group.
Trinity has entered into an agreement to acquire the assets of Meyer Steel Structures, the utility steel structures division of Thomas & Betts Corporation, a member of the ABB Group, for a purchase price of approximately $600 million. The company anticipates full-year 2014 earnings per common diluted share of between $3.90 and $4.10, excluding any effect of the Meyer Steel Structures acquisition. This compares to previous full-year 2014 earnings guidance of between $3.50 and $3.75.
“I am pleased with our strong results for the second quarter and our ability to build upon the positive momentum occurring within Trinity over the past several years,” said Chairman, CEO, and President Timothy R. Wallace. “Consolidated revenues increased 39% year-over-year and net earnings nearly doubled, outpacing revenue growth by a wide margin. The amount of operating leverage we obtained and the record $6.5 billion backlog in our major businesses at the end of the second quarter were impressive. We believe this momentum and the investments we have made in 2014 position us well. Our recently announced agreement to acquire the assets of Meyer Steel Structures is expected to close in the third quarter, subject to regulatory approval. Meyer’s strong engineering reputation, manufacturing capabilities, and products with high steel content align well with Trinity’s existing competencies and offer opportunities to create additional value. The acquisition will broaden Trinity’s product portfolio and supports our vision of being a premier, diversified industrial company.”