Greenbrier 3Q revenue up

The Greenbrier Cos. Friday reported revenue of $317 million in its third quarter ended May 31, up from $207 million in the comparable period in 2010. Net loss for the quarter was $3.3 million, or 14 cents per diluted share, compared with net earnings of $4.6 million, or 23 cents per diluted share, in the prior year’s third quarter.

Lake Oswego, Ore.-based Greenbrier noted that, excluding a one-time charge of $10.0 million pre-tax, $6.0 million after-tax, for costs associated with the retirement of $235 million of senior unsecured notes during the quarter, net earnings were $2.7 million, or 10 cents per share.

Wall Street took the one-time charge in stride.  Shares of GBX were down 3% in mid-morning trading Friday, and halved that loss in early afternoon trade. And in an analyst note Friday, Steve Barger, KeyBanc Capital Markets Inc. director, Industrial Manufacturers, said, “Rather than focusing on these quarterly results, we think investors should look to GBX’s orders of 6,400, which implies a book:bill of 2.9 for the quarter (and represented the strongest level of quarterly bookings since fiscal 1Q08). We think this could be indicative of solid order activity for the industry.”

Barger added, “Overall, we think the order rate and the industry commentary renew our confidence in our positive thesis for the [industry] group, and we continue to believe investors should want exposure” to Greenbrier and its competitive rivals.

The company noted it ended the quarter with $34.3 million of cash and $112.2 million of committed additional borrowing capacity. New railcar deliveries in the third quarter of 2011 were 2,200 units, compared to 700 units in the third quarter of 2010. Greenbrier’s new railcar manufacturing backlog as of May 31 was 13,600 units with an estimated value of $1.05 billion, compared with 9,500 units valued at $720 million at February 28, 2011.

Said President and CEO William A. Furman, “As anticipated, we returned to profitability during the quarter, excluding the one-time charge associated with retiring our $235 million senior unsecured notes. However, these results did not fully meet our expectations, principally due to a temporary shortage of castings in North America and a temporary delay in certification of railcars in Europe, which dampened new railcar deliveries by about 300 units. In addition, about $2 million of certain other non-recurring general & administrative costs were incurred during the third quarter.”

Furman added, “Business momentum continues in what we believe is the early stage of an upturn in the markets we serve. Revenue in our Manufacturing and Wheel Services, Refurbishment & Parts segments, and lease rates on our lease fleet have grown for the third consecutive quarter, driven by stronger demand for our products and services. Business visibility continues to improve, particularly in new railcar manufacturing, where we are experiencing a cyclical recovery and benefitting from the strength of our diversified and expanded product portfolio and the ramping up of additional capacity.”