DALLAS, Texas--(BUSINESS WIRE)--
Trinity Industries, Inc. (NYSE:TRN) today announced earnings results for
the fourth quarter and full year ended December 31, 2014, including the
following significant highlights:
- Strong fourth quarter and record full year earnings per common
diluted share of $0.86 and $4.19, respectively
- Year-over-year fourth quarter and full year revenue growth of 32%
and 41%, respectively, and earnings per common diluted share growth of
19% and 76%, respectively
- All business segments report year-over-year revenue and operating
profit growth during 2014
- Rail Group receives orders for 17,770 new railcars during the
fourth quarter with a record value of over $2.1 billion resulting in
an all-time high backlog of 61,035 units with a recordvalue of
$7.2 billion
- Company issues earnings guidance for full year 2015 of between
$4.00 and $4.40 per common diluted share
Consolidated Results
Trinity Industries, Inc. reported net income attributable to Trinity
stockholders of $138.2 million, or $0.86 per common diluted share, for
the fourth quarter ended December 31, 2014. Net income for the same
quarter of 2013 was $112.8 million, or $0.72 per common diluted share.
Revenues for the fourth quarter of 2014 increased 32% to a record $1.7
billion compared to revenues of $1.3 billion for the same quarter of
2013.
For the year ended December 31, 2014, the Company reported record net
income attributable to Trinity stockholders of $678.2 million, or $4.19
per common diluted share. In 2013, the Company reported net income of
$375.5 million, or $2.38 per common diluted share. Revenues for the year
ended December 31, 2014 were $6.2 billion, a 41% increase compared to
revenues of $4.4 billion in 2013.
“During 2014, we utilized the strengths of our integrated business model
to achieve record financial results, with all of our business segments
reporting higher revenue and profit," said Timothy R. Wallace, Trinity’s
Chairman, CEO and President. "Our Rail Group received a record number of
orders in 2014, and its $7.2 billion order backlog provides significant
production visibility. Our Leasing Group achieved record financial
results in 2014 and generated strong earnings and cash flow from
strategic railcar leasing transactions completed during the year. We
invested over $700 million in acquisitions within our Energy Equipment
Group, which added complementary product lines that provide long-term
growth opportunities."
Business Group Results
In the fourth quarter of 2014, the Rail Group reported record revenues
and operating profit of approximately $1.1 billion and $194.2 million,
respectively, resulting in increases compared to the fourth quarter of
2013 of 25% and 23%, respectively. The increase in revenues and profit
was due to higher deliveries, improved pricing, and a more favorable
product mix. The Rail Group shipped 8,460 railcars and received orders
for 17,770 railcars during the fourth quarter. The Rail Group backlog
increased to a record $7.2 billion at December 31, 2014, representing a
record 61,035 railcars, compared to a backlog of $6.1 billion as of
September 30, 2014, representing 51,725 railcars.
During the fourth quarter of 2014, the Railcar Leasing and Management
Services Group reported revenues of $238.0 million compared to revenues
of $190.8 million during the fourth quarter of 2013. Operating profit
for this Group was $96.6 million in the fourth quarter of 2014 compared
to operating profit of $85.5 million in the fourth quarter of 2013. The
increase in revenues and operating profit was due to higher rental rates
as well as increased railcar sales from the lease fleet. Supplemental
information for the Railcar Leasing and Management Services Group is
provided in the following tables.
During the fourth quarter, the Company sold $114.8 million of railcars
to Element Financial Corporation ("Element") under the strategic
alliance announced in 2013 with $67.8 million reported as sales of
railcars owned one year or less at the time of sale and $47.0 million
reported in the Rail Group as external revenue. With these railcar
sales, the Leasing Group has completed the sale of the first $1 billion
of leased railcars to Element and anticipates fulfilling the $2 billion
alliance in 2015.
The Inland Barge Group reported revenues for the fourth quarter of 2014
of $167.8 million compared to revenues of $142.9 million in the fourth
quarter of 2013. Operating profit for this Group was $25.8 million in
the fourth quarter of 2014 compared to $27.0 million in the fourth
quarter of 2013. The increase in revenues compared to the same quarter
last year was due to higher delivery volumes and product mix changes.
The Inland Barge Group received orders of $130.3 million during the
quarter, and as of December 31, 2014 had a backlog of $437.9 million
compared to a backlog of $475.4 million as of September 30, 2014.
The Energy Equipment Group reported record revenues of $284.4 million in
the fourth quarter of 2014 compared to revenues of $188.5 million in the
same quarter of 2013. Revenues related to acquisitions completed in 2014
totaled $89.0 million for the fourth quarter. Operating profit for the
fourth quarter of 2014 increased to $26.9 million compared to $17.2
million in the same quarter last year. The backlog for structural wind
towers as of December 31, 2014 was $473.5 million compared to a backlog
of $528.6 million as of September 30, 2014.
Revenues in the Construction Products Group were $116.5 million in the
fourth quarter of 2014 compared to revenues of $117.5 million in the
fourth quarter of 2013. The Group recorded an operating loss of $0.3
million in the fourth quarter of 2014 compared to an operating profit of
$7.3 million in the fourth quarter of 2013. Revenues and operating
profit decreased for the fourth quarter of 2014 compared to the same
period in 2013 primarily due to lower volumes in our Highway Products
business.
Cash and Liquidity
At December 31, 2014, the Company had cash, cash equivalents, and
short-term marketable securities of $962.9 million. When combined with
capacity under committed credit facilities, the Company had
approximately $1.6 billion of available liquidity at the end of the
fourth quarter.
Share Repurchase
The Company did not repurchase any shares of common stock under its
share repurchase authorization during the quarter. During 2014, the
Company purchased approximately $31.5 million of shares of common stock,
leaving $218.5 million remaining under its current authorization through
December 31, 2015.
Convertible Notes
The Company’s $450 million convertible notes have a dilutive impact on
the calculation of earnings per share when the average stock price for
the quarter exceeds the conversion price. The average stock price for
the fourth quarter was $33.50 per share compared to the conversion price
in effect during the quarter of $25.22 per share, the result of which
added 4.4 million additional shares to the Company’s diluted share
count, reducing earnings per share by $0.03 per share. For the full
year, approximately 5.6 million shares were added to the Company’s
dilutive share count, reducing earnings per share by $0.16 per
share. The Company’s 2015 earnings guidance, as discussed in the
Earnings Outlook, assumes an annual weighted average diluted share count
of 156.5 million shares, which includes 4.5 million shares from the
convertible notes. The dilutive impact of the convertible notes assumes
an average annual stock price of $33.75 per share and reduces full year
2015 earnings per share by approximately $0.12 per share.
Highway Products Litigation
On October 20, 2014, a jury in a federal district court returned a
verdict against the Company in a False Claims Act (the “Act”) case and
awarded $175 million in damages. The jury's damages award, to the extent
it survives the Company's challenge in post-trial motions or on appeal,
is automatically trebled under the Act to $525 million. Additionally,
the district court is required to impose civil penalties for each
violation of the Act (which penalties are not automatically trebled).
The district court has not yet entered a final judgment or determined a
civil penalty amount. The Company maintains that the allegations are
without merit and intends to vigorously defend its positions in
post-trial motions and on appeal. Pending entry of a final judgment and
completion of the Company’s post-trial and appellate activities in this
matter, the Company currently does not believe that a loss is probable,
therefore no accrual has been included in the consolidated financial
statements.
Earnings Outlook
For the full year of 2015, the Company anticipates earnings per common
diluted share of between $4.00 and $4.40 compared to full year earnings
per common diluted share of $4.19 in 2014. The Company expects the level
of quarterly earnings per share in 2015 to be relatively consistent
throughout the year. As a reminder, first quarter 2014 results included
$0.72 per common diluted share of earnings related to sales of new and
existing leased railcars to Element. As a result, we do expect first
quarter 2015 earnings per common diluted share to be below last year's
level.
Actual results in 2015 may differ from present expectations and could be
impacted by a number of factors including, among others, fluctuations in
prices of commodities that our customers produce and transport;
potential costs or timing of pending tank car regulatory changes;
expenses related to current and potential litigation in our Highway
Products business; various labor situations in the U.S., including those
causing the temporary shut-down of oil refineries as well as
interruptions of imports and exports on the West Coast; the operating
leverage and efficiencies that can be achieved by the Company's
manufacturing businesses; the level of sales and profitability of
railcars; and the impact of weather conditions on our operations and
delivery schedules.
Conference Call
Trinity will hold a conference call at 11:00 a.m. Eastern on
February 19, 2015 to discuss its fourth quarter and full year results.
To listen to the call, please visit the Investor Relations section of
the Trinity Industries website, www.trin.net.
An audio replay may be accessed through the Company’s website or by
dialing (402) 220-0116 until 11:59 p.m. Eastern on February 26, 2015.
Trinity Industries, Inc., headquartered in Dallas, Texas, is a
diversified industrial company that owns market-leading businesses which
provide products and services to the energy, transportation, chemical,
and construction sectors. Trinity reports its financial results in five
principal business segments: the Rail Group, the Railcar Leasing and
Management Services Group, the Inland Barge Group, the Construction
Products Group, and the Energy Equipment Group. For more information,
visit: www.trin.net.
Some statements in this release, which are not historical facts, are
“forward-looking statements” as defined by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements include
statements about Trinity's estimates, expectations, beliefs, intentions
or strategies for the future, and the assumptions underlying these
forward-looking statements. Trinity uses the words “anticipates,”
“believes,” “estimates,” “expects,” “intends,” “forecasts,” “may,”
“will,” “should,” “guidance” and similar expressions to identify these
forward-looking statements. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from
historical experience or our present expectations. For a discussion of
such risks and uncertainties, which could cause actual results to differ
from those contained in the forward-looking statements, see “Risk
Factors” and “Forward-Looking Statements” in the Company's Annual Report
on Form 10-K for the most recent fiscal year.
|
| |
| Trinity Industries, Inc. |
| Condensed Consolidated Income Statements |
(in millions, except per share amounts)
|
(unaudited)
|
| |
|
| | Three Months Ended
December 31, |
| |
| 2014 |
|
|
| 2013 |
|
|
Revenues
| |
$
|
1,661.4
| | |
$
|
1,256.0
| |
|
Operating costs:
| | | | |
|
Cost of revenues
| | |
1,275.3
| | | |
962.7
| |
|
Selling, engineering, and administrative expenses
| | |
110.6
| | | |
80.2
| |
|
(Gain)/loss on disposition of property, plant, and equipment:
| | | | |
|
Net gains on lease fleet sales
| | |
(2.1
|
)
| | |
(10.8
|
)
|
|
Other
| |
|
1.1
|
| |
|
(0.5
|
)
|
| |
|
1,384.9
|
| |
|
1,031.6
|
|
|
Operating profit
| | |
276.5
| | | |
224.4
| |
|
Interest expense, net
| | |
51.6
| | | |
45.1
| |
|
Other (income) expense
| |
|
(1.8
|
)
| |
|
(0.5
|
)
|
|
Income before income taxes
| | |
226.7
| | | |
179.8
| |
|
Provision for income taxes
| |
|
80.3
|
| |
|
60.9
|
|
|
Net income from continuing operations
| | |
146.4
| | | |
118.9
| |
|
Net gain on sale of discontinued operations
| | |
—
| | | |
—
| |
|
Net income (loss) from discontinued operations
| |
|
(0.1
|
)
| |
|
0.4
|
|
|
Net income
| | |
146.3
| | | |
119.3
| |
|
Net income (loss) attributable to noncontrolling interest
| |
|
8.1
|
| |
|
6.5
|
|
|
Net income attributable to Trinity Industries, Inc. | |
$
|
138.2
|
| |
$
|
112.8
|
|
| | | |
|
|
Net income attributable to Trinity Industries, Inc. per common share:
| | | | |
|
Basic
| | | | |
|
Continuing operations
| |
$
|
0.89
| | |
$
|
0.72
| |
|
Discontinued operations
| |
|
—
|
| |
|
—
|
|
| |
$
|
0.89
|
| |
$
|
0.72
|
|
|
Diluted
| | | | |
|
Continuing operations
| |
$
|
0.86
| | |
$
|
0.72
| |
|
Discontinued operations
| |
|
—
|
| |
|
—
|
|
| |
$
|
0.86
|
| |
$
|
0.72
|
|
|
Weighted average number of shares outstanding:
| | | | |
|
Basic
| | |
151.2
| | | |
151.8
| |
|
Diluted
| | |
155.7
| | | |
151.9
| |
All share and per share information has been retroactively adjusted to
reflect the 2-for-1 stock split completed during the quarter ended June
30, 2014. Trinity is required to utilize the two-class method of
accounting when calculating earnings per share as a result of unvested
restricted shares that have non-forfeitable rights to dividends and are,
therefore, considered to be a participating security. The unvested
restricted shares are excluded from the weighted average number of
shares outstanding for the purposes of determining earnings per share.
The two-class method results in a lower earnings per share than is
calculated from the face of the income statement. See Earnings Per Share
Calculation table below.
|
| |
| Trinity Industries, Inc. |
| Condensed Consolidated Income Statements |
(in millions, except per share amounts)
|
(unaudited)
|
| |
|
| | Year Ended
December 31, |
| |
| 2014 |
|
|
| 2013 |
|
|
Revenues
| |
$
|
6,170.0
| | |
$
|
4,365.3
| |
|
Operating costs:
| | | | |
|
Cost of revenues
| | |
4,619.8
| | | |
3,322.3
| |
|
Selling, engineering, and administrative expenses
| | |
403.6
| | | |
291.3
| |
|
(Gain)/loss on disposition of property, plant, and equipment:
| | | | |
|
Net gains on lease fleet sales
| | |
(92.3
|
)
| | |
(20.4
|
)
|
|
Other
| |
|
(12.1
|
)
| |
|
(0.8
|
)
|
| |
|
4,919.0
|
| |
|
3,592.4
|
|
|
Operating profit
| | |
1,251.0
| | | |
772.9
| |
|
Interest expense, net
| | |
191.5
| | | |
185.2
| |
|
Other (income) expense
| |
|
(4.6
|
)
| |
|
(2.8
|
)
|
|
Income before income taxes
| | |
1,064.1
| | | |
590.5
| |
|
Provision for income taxes
| |
|
354.8
|
| |
|
204.4
|
|
|
Net income from continuing operations
| | |
709.3
| | | |
386.1
| |
|
Net gain on sale of discontinued operations
| | |
—
| | | |
7.1
| |
|
Net income (loss) from discontinued operations
| |
|
—
|
| |
|
(0.8
|
)
|
|
Net income
| | |
709.3
| | | |
392.4
| |
|
Net income (loss) attributable to noncontrolling interest
| |
|
31.1
|
| |
|
16.9
|
|
|
Net income attributable to Trinity Industries, Inc. | |
$
|
678.2
|
| |
$
|
375.5
|
|
| | | |
|
|
Net income attributable to Trinity Industries, Inc. per common share:
| | | | |
|
Basic
| | | | |
|
Continuing operations
| |
$
|
4.35
| | |
$
|
2.34
| |
|
Discontinued operations
| |
|
—
|
| |
|
0.04
|
|
| |
$
|
4.35
|
| |
$
|
2.38
|
|
|
Diluted
| | | | |
|
Continuing operations
| |
$
|
4.19
| | |
$
|
2.34
| |
|
Discontinued operations
| |
|
—
|
| |
|
0.04
|
|
| |
$
|
4.19
|
| |
$
|
2.38
|
|
|
Weighted average number of shares outstanding:
| | | | |
|
Basic
| | |
151.0
| | | |
152.8
| |
|
Diluted
| | |
156.7
| | | |
152.9
| |
All share and per share information has been retroactively adjusted to
reflect the 2-for-1 stock split completed during the quarter ended June
30, 2014. Trinity is required to utilize the two-class method of
accounting when calculating earnings per share as a result of unvested
restricted shares that have non-forfeitable rights to dividends and are,
therefore, considered to be a participating security. The unvested
restricted shares are excluded from the weighted average number of
shares outstanding for the purposes of determining earnings per share.
The two-class method results in a lower earnings per share than is
calculated from the face of the income statement. See Earnings Per Share
Calculation table below.
|
| |
| Trinity Industries, Inc. |
| Condensed Segment Data |
(in millions)
|
(unaudited)
|
| |
|
| | Three Months Ended
December 31, |
| Revenues: | |
| 2014 |
|
|
| 2013 |
|
| Rail Group | |
$
|
1,067.4
| | |
$
|
855.5
| |
| Construction Products Group | | |
116.5
| | | |
117.5
| |
| Inland Barge Group | | |
167.8
| | | |
142.9
| |
| Energy Equipment Group | | |
284.4
| | | |
188.5
| |
| Railcar Leasing and Management Services Group | | |
238.0
| | | |
190.8
| |
|
All Other
| |
|
30.2
|
| |
|
23.6
|
|
|
Segment Totals before Eliminations
| | |
1,904.3
| | | |
1,518.8
| |
|
Eliminations - lease subsidiary
| | |
(145.9
|
)
| | |
(196.0
|
)
|
|
Eliminations - other
| |
|
(97.0
|
)
| |
|
(66.8
|
)
|
|
Consolidated Total
| |
$
|
1,661.4
|
| |
$
|
1,256.0
|
|
| | | |
|
| | Three Months Ended
December 31, |
| Operating profit (loss): | |
| 2014 |
| |
| 2013 |
|
| Rail Group | |
$
|
194.2
| | |
$
|
157.4
| |
| Construction Products Group | | |
(0.3
|
)
| | |
7.3
| |
| Inland Barge Group | | |
25.8
| | | |
27.0
| |
| Energy Equipment Group | | |
26.9
| | | |
17.2
| |
| Railcar Leasing and Management Services Group | | |
96.6
| | | |
85.5
| |
|
All Other
| |
|
(14.3
|
)
| |
|
(5.7
|
)
|
|
Segment Totals before Eliminations and Corporate Expenses
| | |
328.9
| | | |
288.7
| |
|
Corporate
| | |
(29.5
|
)
| | |
(23.5
|
)
|
|
Eliminations - lease subsidiary
| | |
(22.6
|
)
| | |
(40.0
|
)
|
|
Eliminations - other
| |
|
(0.3
|
)
| |
|
(0.8
|
)
|
|
Consolidated Total
| |
$
|
276.5
|
| |
$
|
224.4
|
|
|
| |
| Trinity Industries, Inc. |
| Condensed Segment Data |
(in millions)
|
(unaudited)
|
| |
|
| | Year Ended
December 31, |
| Revenues: | |
| 2014 |
|
|
| 2013 |
|
| Rail Group | |
$
|
3,816.8
| | |
$
|
2,867.5
| |
| Construction Products Group | | |
551.7
| | | |
525.0
| |
| Inland Barge Group | | |
638.5
| | | |
576.7
| |
| Energy Equipment Group | | |
992.3
| | | |
665.4
| |
| Railcar Leasing and Management Services Group | | |
1,118.3
| | | |
645.4
| |
|
All Other
| |
|
110.4
|
| |
|
86.6
|
|
|
Segment Totals before Eliminations
| | |
7,228.0
| | | |
5,366.6
| |
|
Eliminations - lease subsidiary
| | |
(710.1
|
)
| | |
(756.5
|
)
|
|
Eliminations - other
| |
|
(347.9
|
)
| |
|
(244.8
|
)
|
|
Consolidated Total
| |
$
|
6,170.0
|
| |
$
|
4,365.3
|
|
| | | |
|
| | Year Ended
December 31, |
| Operating profit (loss): | |
| 2014 |
| |
| 2013 |
|
| Rail Group | |
$
|
724.1
| | |
$
|
489.7
| |
| Construction Products Group | | |
65.4
| | | |
52.6
| |
| Inland Barge Group | | |
114.4
| | | |
96.0
| |
| Energy Equipment Group | | |
108.1
| | | |
61.4
| |
| Railcar Leasing and Management Services Group | | |
516.3
| | | |
296.8
| |
|
All Other
| |
|
(25.6
|
)
| |
|
(13.7
|
)
|
|
Segment Totals before Eliminations and Corporate Expenses
| | |
1,502.7
| | | |
982.8
| |
|
Corporate
| | |
(119.0
|
)
| | |
(73.4
|
)
|
|
Eliminations - lease subsidiary
| | |
(133.1
|
)
| | |
(135.4
|
)
|
|
Eliminations - other
| |
|
0.4
|
| |
|
(1.1
|
)
|
|
Consolidated Total
| |
$
|
1,251.0
|
| |
$
|
772.9
|
|
|
| |
| |
| Trinity Industries, Inc. |
| Leasing Group |
Condensed Results of Operations |
(unaudited)
|
| | | |
|
| | Three Months Ended
December 31, | | Year Ended
December 31, |
| |
| 2014 |
|
|
| 2013 |
|
| Percent | |
| 2014 |
|
|
| 2013 |
|
| Percent |
| | ($ in millions) | | Change | | ($ in millions) | | Change |
| | | | | | | | | | | |
|
|
Revenues:
| | | | | | | | | | | | |
|
Leasing and management
| |
$
|
162.8
| | |
$
|
151.3
| | |
7.6
|
%
| |
$
|
632.0
| | |
$
|
586.9
| | |
7.7
|
%
|
|
Sales of railcars owned one year or less at the time of sale
| |
|
75.2
|
| |
|
39.5
|
| |
*
| |
|
486.3
|
| |
|
58.5
|
| |
*
|
|
Total revenues
| |
$
|
238.0
| | |
$
|
190.8
| | |
24.7
| | |
$
|
1,118.3
| | |
$
|
645.4
| | |
73.3
| |
| | | | | | | | | | | |
|
|
Operating profit:
| | | | | | | | | | | | |
|
Leasing and management
| |
$
|
74.1
| | |
$
|
69.1
| | |
7.2
| | |
$
|
287.9
| | |
$
|
267.3
| | |
7.7
| |
|
Railcar sales:
| | | | | | | | | | | | |
|
Railcars owned one year or less at the time of sale
| | |
20.4
| | | |
5.6
| | | | | |
136.1
| | | |
9.1
| | | |
|
Railcars owned more than one year at the time of sale
| |
|
2.1
|
| |
|
10.8
|
| | | |
|
92.3
|
| |
|
20.4
|
| | |
|
Total operating profit
| |
$
|
96.6
| | |
$
|
85.5
| | |
13.0
| | |
$
|
516.3
| | |
$
|
296.8
| | |
74.0
| |
| | | | | | | | | | | |
|
|
Operating profit margin:
| | | | | | | | | | | | |
|
Leasing and management
| | |
45.5
|
%
| | |
45.7
|
%
| | | | |
45.6
|
%
| | |
45.5
|
%
| | |
|
Railcar sales
| |
*
| |
*
| | | |
*
| |
*
| | |
|
Total operating profit margin
| | |
40.6
|
%
| | |
44.8
|
%
| | | | |
46.2
|
%
| | |
46.0
|
%
| | |
| | | | | | | | | | | |
|
|
Selected expense information(1):
| | | | | | | | | | | | |
|
Depreciation
| |
$
|
32.9
| | |
$
|
33.2
| | |
(0.9
|
)
| |
$
|
130.0
| | |
$
|
129.0
| | |
0.8
| |
|
Maintenance
| |
$
|
20.1
| | |
$
|
17.7
| | |
13.6
| | |
$
|
78.9
| | |
$
|
71.5
| | |
10.3
| |
|
Rent
| |
$
|
13.2
| | |
$
|
13.3
| | |
(0.8
|
)
| |
$
|
52.9
| | |
$
|
53.3
| | |
(0.8
|
)
|
|
Interest:
| | | | | | | | | | | | |
|
External
| |
$
|
38.8
| | |
$
|
37.3
| | | | |
$
|
153.3
| | |
$
|
153.5
| | | |
|
Intercompany
| |
|
—
|
| |
|
—
|
| | | |
|
—
|
| |
|
3.8
|
| | |
|
Total interest expense
| |
$
|
38.8
| | |
$
|
37.3
| | |
4.0
| | |
$
|
153.3
| | |
$
|
157.3
| | |
(2.5
|
)
|
|
| |
| |
| | December 31,
2014 | | December 31,
2013 |
|
Leasing portfolio information:
| | | | |
|
Portfolio size (number of railcars)
| |
75,930
| | |
75,685
| |
|
Portfolio utilization
| |
99.5
|
%
| |
99.5
|
%
|
* Not meaningful
(1) Depreciation, maintenance, and rent expense are
components of operating profit. Amortization of deferred profit on
railcars sold from the Rail Group to the Leasing Group is included in
the operating profits of the Leasing Group resulting in the recognition
of depreciation expense based on the Company's original manufacturing
cost of the railcars. Interest expense is not a component of operating
profit and includes the effect of hedges. Intercompany interest expense
is eliminated in consolidation and arises from Trinity’s previous
ownership of a portion of TRIP Holdings’ Senior Secured Notes, which
notes were retired in full in May 2013.
|
| |
| |
| Trinity Industries, Inc. |
| Condensed Consolidated Balance Sheets |
(in millions)
|
(unaudited)
|
| | | |
|
| | December 31,
2014 | | December 31,
2013 |
|
Cash and cash equivalents
| |
$
|
887.9
| |
$
|
428.5
|
|
Short-term marketable securities
| | |
75.0
| | |
149.7
|
|
Receivables, net of allowance
| | |
405.3
| | |
365.0
|
|
Income tax receivable
| | |
58.6
| | |
7.7
|
|
Inventories
| | |
1,068.4
| | |
814.7
|
|
Restricted cash
| | |
234.7
| | |
260.7
|
|
Net property, plant, and equipment
| | |
4,902.9
| | |
4,770.6
|
|
Goodwill
| | |
773.2
| | |
278.2
|
|
Other assets
| |
|
327.8
| |
|
238.3
|
| |
$
|
8,733.8
| |
$
|
7,313.4
|
| | | |
|
|
Accounts payable
| |
$
|
295.4
| |
$
|
216.3
|
|
Accrued liabilities
| | |
709.6
| | |
567.4
|
|
Debt, net of unamortized discount of $60.0 and $74.1 | | |
3,553.0
| | |
2,989.8
|
|
Deferred income
| | |
36.4
| | |
40.8
|
|
Deferred income taxes
| | |
632.6
| | |
650.7
|
|
Other liabilities
| | |
109.4
| | |
99.3
|
|
Stockholders' equity
| |
|
3,397.4
| |
|
2,749.1
|
| |
$
|
8,733.8
| |
$
|
7,313.4
|
|
| |
| |
| Trinity Industries, Inc. |
| Additional Balance Sheet Information |
(in millions)
|
(unaudited)
|
| | | |
|
| | December 31,
2014 | | December 31,
2013 |
| Property, Plant, and Equipment | | | | |
|
Corporate/Manufacturing:
| | | | |
|
Property, plant, and equipment
| |
$
|
1,681.7
| | |
$
|
1,418.9
| |
|
Accumulated depreciation
| |
|
(820.7
|
)
| |
|
(748.3
|
)
|
| |
|
861.0
|
| |
|
670.6
|
|
|
Leasing:
| | | | |
|
Wholly-owned subsidiaries:
| | | | |
|
Machinery and other
| | |
10.7
| | | |
10.3
| |
|
Equipment on lease
| | |
3,189.6
| | | |
3,509.1
| |
|
Accumulated depreciation
| |
|
(601.1
|
)
| |
|
(554.8
|
)
|
| |
|
2,599.2
|
| |
|
2,964.6
|
|
|
Partially-owned subsidiaries:
| | | | |
|
Equipment on lease
| | |
2,261.2
| | | |
1,887.2
| |
|
Accumulated depreciation
| |
|
(261.3
|
)
| |
|
(202.1
|
)
|
| |
|
1,999.9
|
| |
|
1,685.1
|
|
| | | |
|
|
Net deferred profit on railcars sold to the Leasing Group | |
|
(557.2
|
)
| |
|
(549.7
|
)
|
| |
$
|
4,902.9
|
| |
$
|
4,770.6
|
|
|
| |
| |
| Trinity Industries, Inc. |
| Additional Balance Sheet Information |
(in millions)
|
(unaudited)
|
| | | |
|
| | December 31,
2014 | | December 31,
2013 |
| Debt | | | | |
|
Corporate - Recourse:
| | | | |
|
Revolving credit facility
| |
$
|
—
| |
$
|
—
|
|
Senior notes due 2024, net of unamortized discount of $0.4 and $-
| | |
399.6
| | |
—
|
|
Convertible subordinated notes, net of unamortized discount of $59.6
and $74.1 | | |
389.9
| | |
375.9
|
|
Other
| |
|
0.7
| |
|
0.9
|
| |
|
790.2
| |
|
376.8
|
|
Leasing:
| | | | |
|
Wholly-owned subsidiaries:
| | | | |
|
Recourse:
| | | | |
|
Capital lease obligations
| |
|
39.1
| |
|
42.2
|
| |
|
39.1
| |
|
42.2
|
|
Non-recourse:
| | | | |
|
Secured railcar equipment notes
| | |
723.3
| | |
766.6
|
|
Warehouse facility
| | |
120.6
| | |
152.0
|
|
Promissory notes
| |
|
363.9
| |
|
396.1
|
| |
|
1,207.8
| |
|
1,314.7
|
|
Partially-owned subsidiaries - Non-recourse:
| | | | |
|
Secured railcar equipment notes
| |
|
1,515.9
| |
|
1,256.1
|
| |
|
1,515.9
| |
|
1,256.1
|
| |
$
|
3,553.0
| |
$
|
2,989.8
|
| |
| |
| Trinity Industries, Inc. |
| Additional Balance Sheet Information |
(in millions)
|
(unaudited)
|
| | |
|
| December 31,
2014 | | December 31,
2013 |
| Leasing Debt Summary | | | |
|
Total Recourse Debt
|
$
|
39.1
| | |
$
|
42.2
| |
|
Total Non-Recourse Debt(1) |
|
2,723.7
|
| |
|
2,570.8
|
|
|
$
|
2,762.8
|
| |
$
|
2,613.0
|
|
|
Total Leasing Debt
| | | |
|
Wholly-owned subsidiaries
|
$
|
1,246.9
| | |
$
|
1,356.9
| |
|
Partially-owned subsidiaries
|
|
1,515.9
|
| |
|
1,256.1
|
|
|
$
|
2,762.8
|
| |
$
|
2,613.0
|
|
|
Equipment on Lease(1) | | | |
|
Wholly-owned subsidiaries
|
$
|
2,599.2
| | |
$
|
2,964.6
| |
|
Partially-owned subsidiaries
|
|
1,999.9
|
| |
|
1,685.1
|
|
|
$
|
4,599.1
|
| |
$
|
4,649.7
|
|
|
Total Leasing Debt as a % of Equipment on Lease
| | | |
|
Wholly-owned subsidiaries
| |
48.0
|
%
| | |
45.8
|
%
|
|
Partially-owned subsidiaries
| |
75.8
|
%
| | |
74.5
|
%
|
|
Combined
| |
60.1
|
%
| | |
56.2
|
%
|
(1) Excludes net deferred profit on railcars sold to the Leasing Group.
|
| |
| Trinity Industries, Inc. |
| Condensed Consolidated Cash Flow Statements |
(in millions)
|
(unaudited)
|
| |
|
| | Year Ended
December 31, |
| |
| 2014 |
|
|
| 2013 |
|
| Operating activities: | | | | |
|
Net income
| |
$
|
709.3
| | |
$
|
392.4
| |
|
Adjustments to reconcile net income to net cash provided by
operating activities:
| | | | |
|
Income from discontinued operations
| | |
—
| | | |
(6.3
|
)
|
|
Depreciation and amortization
| | |
244.6
| | | |
211.5
| |
|
Net gains on sales of railcars owned more than one year at the time
of sale
| | |
(92.3
|
)
| | |
(20.4
|
)
|
|
Other
| | |
38.2
| | | |
107.9
| |
|
Changes in assets and liabilities:
| | | | |
|
(Increase) decrease in receivables
| | |
(56.4
|
)
| | |
17.2
| |
|
(Increase) decrease in inventories
| | |
(186.3
|
)
| | |
(95.6
|
)
|
|
Increase (decrease) in accounts payable and accrued liabilities
| | |
142.8
| | | |
101.4
| |
|
Other
| |
|
19.3
|
| |
|
(45.9
|
)
|
|
Net cash provided by operating activities
| |
|
819.2
|
| |
|
662.2
|
|
| Investing activities: | | | | |
|
Proceeds from sales of railcars owned more than one year at the time
of sale
| | |
265.8
| | | |
131.6
| |
|
Proceeds from disposition of property, plant, and equipment
| | |
23.0
| | | |
3.7
| |
|
Capital expenditures - leasing, net of sold railcars owned one year
or less with a net cost of $350.2 and $49.4 | | |
(245.3
|
)
| | |
(581.1
|
)
|
|
Capital expenditures - manufacturing and other
| | |
(219.3
|
)
| | |
(149.9
|
)
|
|
(Increase) decrease in short-term marketable securities
| | |
74.7
| | | |
(149.7
|
)
|
|
Acquisitions
| | |
(714.4
|
)
| | |
(73.2
|
)
|
|
Other
| |
|
0.8
|
| |
|
0.6
|
|
|
Net cash required by investing activities
| |
|
(814.7
|
)
| |
|
(818.0
|
)
|
| Financing activities: | | | | |
|
Payments to retire debt
| | |
(186.6
|
)
| | |
(262.1
|
)
|
|
Proceeds from issuance of debt
| | |
727.3
| | | |
175.0
| |
|
Shares repurchased
| | |
(36.5
|
)
| | |
(103.2
|
)
|
|
Dividends paid to common shareholders
| | |
(54.4
|
)
| | |
(39.3
|
)
|
|
Purchase of shares to satisfy employee tax on vested stock
| | |
(38.3
|
)
| | |
(9.6
|
)
|
|
Proceeds from sale of interests in partially-owned leasing
subsidiaries
| | |
—
| | | |
296.7
| |
|
Repurchase of noncontrolling interest
| | |
—
| | | |
(84.0
|
)
|
|
Contributions from noncontrolling interest
| | |
49.6
| | | |
50.0
| |
|
Distributions to noncontrolling interest
| | |
(28.2
|
)
| | |
(10.0
|
)
|
|
(Increase) decrease in restricted cash
| | |
1.0
| | | |
(12.5
|
)
|
|
Other
| |
|
21.0
|
| |
|
10.3
|
|
|
Net cash provided by financing activities
| |
|
454.9
|
| |
|
11.3
|
|
|
Net increase (decrease) in cash and cash equivalents
| | |
459.4
| | | |
(144.5
|
)
|
|
Cash and cash equivalents at beginning of period
| |
|
428.5
|
| |
|
573.0
|
|
|
Cash and cash equivalents at end of period
| |
$
|
887.9
|
| |
$
|
428.5
|
|
| | | | | | | |
|
Trinity Industries, Inc.
Earnings per Share Calculation
(in
millions, except per share amounts, unaudited)
Basic net income attributable to Trinity Industries, Inc. per common
share is computed by dividing net income attributable to Trinity
remaining after allocation to unvested restricted shares by the weighted
average number of basic common shares outstanding for the period. All
share and per share information has been retroactively adjusted to
reflect the 2-for-1 stock split completed during the quarter ended June
30, 2014.
|
| |
| |
| | Three Months Ended
December 31, 2014 | | Three Months Ended
December 31, 2013 |
| |
Income
|
|
Average
|
| | |
Income
|
|
Average
|
| |
| |
(Loss)
| |
Shares
| |
EPS
| |
(Loss)
| |
Shares
| |
EPS
|
|
Net income from continuing operations
| |
$
|
146.4
| | | | | | |
$
|
118.9
| | | | | |
|
Less: net income from continuing operations attributable to
noncontrolling interest
| |
|
8.1
|
| | | | | |
|
6.5
|
| | | | |
|
Net income from continuing operations attributable to Trinity
Industries, Inc. | | |
138.3
| | | | | | | |
112.4
| | | | | |
|
Unvested restricted share participation
| |
|
(4.4
|
)
| | | | | |
|
(3.7
|
)
| | | | |
|
Net income from continuing operations attributable to Trinity
Industries, Inc. - basic
| | |
133.9
| | |
151.2
| |
$
|
0.89
| | |
108.7
| | |
151.8
| |
$
|
0.72
|
|
Effect of dilutive securities:
| | | | | | | | | | | | |
|
Stock options
| | |
—
| | |
0.1
| | | | |
—
| | |
0.1
| | |
|
Convertible subordinated notes
| |
|
0.1
|
| |
4.4
| | | |
|
—
|
| |
—
| | |
|
Net income from continuing operations attributable to Trinity
Industries, Inc. - diluted
| |
$
|
134.0
|
| |
155.7
| |
$
|
0.86
| |
$
|
108.7
|
| |
151.9
| |
$
|
0.72
|
| | | | | | | | | | | |
|
|
Net income (loss) from discontinued operations, net of taxes
| |
$
|
(0.1
|
)
| | | | | |
$
|
0.4
| | | | | |
|
Unvested restricted share participation
| |
|
—
|
| | | | | |
|
—
|
| | | | |
|
Net income (loss) from discontinued operations, net of taxes - basic
| | |
(0.1
|
)
| |
151.2
| |
$
|
—
| | |
0.4
| | |
151.8
| |
$
|
—
|
|
Effect of dilutive securities:
| | | | | | | | | | | | |
|
Stock options
| | |
—
| | |
0.1
| | | | |
—
| | |
0.1
| | |
|
Convertible subordinated notes
| |
|
—
|
| |
4.4
| | | |
|
—
|
| |
—
| | |
|
Net income (loss) from discontinued operations, net of taxes -
diluted
| |
$
|
(0.1
|
)
| |
155.7
| |
$
|
—
| |
$
|
0.4
|
| |
151.9
| |
$
|
—
|
| | Year Ended
December 31, 2014 | | Year Ended
December 31, 2013 |
| |
Income
| |
Average
| | | |
Income
| |
Average
| | |
| |
(Loss)
| |
Shares
| |
EPS
| |
(Loss)
| |
Shares
| |
EPS
|
|
Net income from continuing operations
| |
$
|
709.3
| | | | | | |
$
|
386.1
| | | | | |
|
Less: net income from continuing operations attributable to
noncontrolling interest
| |
|
31.1
|
| | | | | |
|
16.9
|
| | | | |
|
Net income from continuing operations attributable to Trinity
Industries, Inc. | | |
678.2
| | | | | | | |
369.2
| | | | | |
|
Unvested restricted share participation
| |
|
(22.1
|
)
| | | | | |
|
(12.0
|
)
| | | | |
|
Net income from continuing operations attributable to Trinity
Industries, Inc. - basic
| | |
656.1
| | |
151.0
| |
$
|
4.35
| | |
357.2
| | |
152.8
| |
$
|
2.34
|
|
Effect of dilutive securities:
| | | | | | | | | | | | |
|
Stock options
| | |
—
| | |
0.1
| | | | |
—
| | |
0.1
| | |
|
Convertible subordinated notes
| |
|
0.7
|
| |
5.6
| | | |
|
—
|
| |
—
| | |
|
Net income from continuing operations attributable to Trinity
Industries, Inc. - diluted
| |
$
|
656.8
|
| |
156.7
| |
$
|
4.19
| |
$
|
357.2
|
| |
152.9
| |
$
|
2.34
|
| | | | | | | | | | | |
|
|
Net income (loss) from discontinued operations, net of taxes
| |
$
|
—
| | | | | | |
$
|
6.3
| | | | | |
|
Unvested restricted share participation
| |
|
—
|
| | | | | |
|
(0.2
|
)
| | | | |
|
Net income (loss) from discontinued operations, net of taxes - basic
| | |
—
| | |
151.0
| |
$
|
—
| | |
6.1
| | |
152.8
| |
$
|
0.04
|
|
Effect of dilutive securities:
| | | | | | | | | | | | |
|
Stock options
| | |
—
| | |
0.1
| | | | |
—
| | |
0.1
| | |
|
Convertible subordinated notes
| |
|
—
|
| |
5.6
| | | |
|
—
|
| |
—
| | |
|
Net income (loss) from discontinued operations, net of taxes -
diluted
| |
$
|
—
|
| |
156.7
| |
$
|
—
| |
$
|
6.1
|
| |
152.9
| |
$
|
0.04
|
| | | | | | | | | | | | | | | | | |
|
Trinity Industries, Inc.
Reconciliation of EBITDA
(in
millions)
(unaudited)
“EBITDA” is defined as income (loss) from continuing operations plus
interest expense, income taxes, and depreciation and amortization
including goodwill impairment charges. EBITDA is not a calculation based
on generally accepted accounting principles. The amounts included in the
EBITDA calculation are, however, derived from amounts included in the
historical statements of operations data. In addition, EBITDA should not
be considered as an alternative to net income or operating income as an
indicator of our operating performance, or as an alternative to
operating cash flows as a measure of liquidity. We believe EBITDA
assists investors in comparing a company’s performance on a consistent
basis without regard to depreciation and amortization, which can vary
significantly depending upon many factors. However, the EBITDA measure
presented in this press release may not always be comparable to
similarly titled measures by other companies due to differences in the
components of the calculation.
|
| |
| | Three Months Ended
December 31, |
| |
| 2014 |
|
|
| 2013 |
| | |
| | |
|
Net income from continuing operations
| |
$
|
146.4
| | |
$
|
118.9
|
|
Add:
| | | | | |
|
Interest expense
| | |
52.0
| | | |
45.8
|
|
Provision for income taxes
| | |
80.3
| | | |
60.9
|
|
Depreciation and amortization expense
| |
|
73.1
|
| |
|
55.3
|
|
Earnings from continuing operations before interest expense, income
taxes, and depreciation and amortization expense
| |
$
|
351.8
|
| |
$
|
280.9
|
| |
|
| | Year Ended
December 31, |
| |
| 2014 |
| |
| 2013 |
| | | | |
|
|
Net income from continuing operations
| |
$
|
709.3
| | |
$
|
386.1
|
|
Add:
| | | | | |
|
Interest expense
| | |
193.4
| | | |
187.3
|
|
Provision for income taxes
| | |
354.8
| | | |
204.4
|
|
Depreciation and amortization expense
| |
|
244.6
|
| |
|
211.5
|
|
Earnings from continuing operations before interest expense, income
taxes, and depreciation and amortization expense
| |
$
|
1,502.1
|
| |
$
|
989.3
|
Trinity Industries, Inc.
Investor Contact:
Jessica
Greiner, 214-631-4420
Director of Investor Relations
or
Media
Contact:
Jack Todd, 214-589-8909
Source: Trinity Industries, Inc.