TRAC Intermodal 8-K TRAC Intermodal Reports Third Quarter 2013 Earnings

TRAC Intermodal LLC and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

(Dollars in Thousands)

	September 30,			December 31,
	2013			2012
Assets
Cash and cash equivalents	$	8,933		$	26,556
Accounts receivable, net of allowance of $12,077 and $7,325, respectively		124,292			80,620
Net investment in direct finance leases		26,915			40,729
Leasing equipment, net of accumulated depreciation of $347,984 and $309,010, respectively		1,409,056			1,325,383
Fair value of derivative instruments		2,796			—
Goodwill		251,907			251,907
Other assets		44,497			43,268
Total assets	$	1,868,396		$	1,768,463
Liabilities and member’s interest
Liabilities:
Accounts payable	$	15,238		$	10,270
Accrued expenses and other liabilities		45,794			37,320
Deferred income taxes		77,879			73,569
Debt and capital lease obligations:
Due within one year		29,048			25,884
Due after one year		1,158,813			1,082,513
Total debt and capital lease obligations		1,187,861			1,108,397
Total liabilities		1,326,772			1,229,556
Commitments and contingencies		—			—
Member’s interest:
Member’s interest		583,003			590,883
Accumulated other comprehensive loss		(41,379	)		(51,976	)
Total member’s interest		541,624			538,907
Total liabilities and member’s interest	$	1,868,396		$	1,768,463

TRAC Intermodal LLC and Subsidiaries

Consolidated Statements of Operations

(Unaudited)

(Dollars in Thousands)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
Revenues:	2013			2012			2013			2012
Equipment leasing revenue	$	125,488		$	97,803		$	345,002		$	267,105
Finance revenue		746			1,252			2,564			3,950
Other revenue		8,010			10,729			31,609			27,743
Total revenues		134,244			109,784			379,175			298,798
Expenses:
Direct operating expenses		81,140			60,583			215,336			155,492
Selling, general and administrative expenses		14,737			10,893			41,998			33,937
Depreciation expense		18,161			16,418			53,124			49,419
Provision for doubtful accounts		3,727			260			8,434			2,073
Impairment of leasing equipment		1,065			3,081			3,629			5,073
Loss on retirement of debt		6			6,294			901			6,443
Interest expense		22,926			20,304			68,336			52,267
Interest income		(15	)		(88	)		(286	)		(109	)
Other expense (income), net		94			(89	)		(1,896	)		(640	)
Total expenses		141,841			117,656			389,576			303,955
Loss before benefit for income taxes		(7,597	)		(7,872	)		(10,401	)		(5,157	)
Benefit for income taxes		(1,273	)		(3,201	)		(2,409	)		(2,047	)
Net loss	$	(6,324	)	$	(4,671	)	$	(7,992	)	$	(3,110	)

TRAC Intermodal LLC and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

(Dollars in Thousands)

	Nine Months Ended September 30,
	2013			2012
Cash flows from operating activities
Net loss	$	(7,992	)	$	(3,110	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		53,302			49,749
Provision for doubtful accounts		8,434			2,073
Amortization of deferred financing fees		4,609			2,576
Loss on retirement of debt		901			6,443
Derivative loss reclassified into earnings		15,180			5,367
Ineffective portion of cash flow hedges		(60	)		53
Payment to terminate derivative instruments		—			(90,370	)
Impairment of leasing equipment		3,629			5,073
Share based compensation		873			1,311
Deferred income taxes		(2,336	)		(2,666	)
Other, net		(1,172	)		(271	)
Changes in assets and liabilities:
Accounts receivable		(52,106	)		(20,531	)
Other assets		(700	)		742
Accounts payable		4,969			3,820
Accrued expenses and other liabilities		4,296			3,734
Net cash provided by (used in) operating activities		31,827			(36,007	)
Cash flows from investing activities
Proceeds from sale of leasing equipment		5,961			2,028
Collections on net investment in direct finance leases, net of interest earned		4,262			5,897
Purchase of leasing equipment		(131,509	)		(30,034	)
Purchase of fixed assets		(3,617	)		(547	)
Net cash used in investing activities		(124,903	)		(22,656	)
Cash flows from financing activities
Proceeds from long-term debt		142,000			816,397
Repayments of long-term debt		(63,506	)		(732,576	)
Cash paid for debt issuance fees		(2,267	)		(30,306	)
Capital contribution from parent		—			3,334
Investment in parent		—			(3,354	)
Repurchase of shares from employees		(509	)		(307	)
Net cash provided by financing activities		75,718			53,188
Effect of changes in exchange rates on cash and cash equivalents		(265	)		161
Net decrease in cash and cash equivalents		(17,623	)		(5,314	)
Cash and cash equivalents, beginning of year		26,556			29,005
Cash and cash equivalents, end of period	$	8,933		$	23,691
Supplemental disclosures of cash flow information
Cash paid for interest	$	57,784		$	45,737
Cash paid (refunded) for taxes, net	$	315		$	(632	)