GBX - Earnings call transcript Q3 2018 | The Greenbrier Companies, Inc.

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Operator

Hello, and welcome to The Greenbrier Companies Third Quarter of Fiscal Year 2018 Earnings Call.

Following today's presentation, we will conduct a question-and-answer session. Each analyst should limit themselves to only two questions. Until that time, all lines will be in listen-only mode. At the request of The Greenbrier Companies, this conference call is being recorded for instant replay purposes. would turn I to conference time, Mr. this like this to over At

President Roberts, Treasurer. Roberts, and Justin Vice Mr. you begin. may

Justin Roberts

will fiscal XXXX Martin. and Chairman you, and of our call, the the Good everyone. am conference and quarter I And today's for call. Vice and by remainder CEO, Tekorius, Bill for the Thank CFO. results joined provide On They Executive outlook welcome discuss XXXX. morning, Lorie an third Greenbrier's to President Furman quarter will

our up Following we call the open prepared will remarks, for questions.

our discussed release Litigation to the metrics forward-looking of include differ this addition behalf a any supplemental Web Securities of that on made In on important the of factors on includes XXXX. within found section Act up describe XXXX by I’ll the statements Matters with forward-looking data, be financial will Greenbrier. beyond open Reform press Greenbrier’s slide of today’s key in some for issued Throughout expressed and call that, today, conference IR or in the the morning, today Private posted our from results those the Bill. information and call cause discussion which could meaning presentation in statements we And actual additional of can site. materially to

Bill Furman

strong our very fiscal highlighted and by quarter, Thank you, margins, cash Justin, financial balance and good the morning quarter. sheet everyone. third and results healthy Greenbrier posted flow strong in operating strong for gross operating

North supplemented our well. so order activity, year that as had order quarter also for the activity by domestic, our predominantly also that fiscal strategy best We was international while and America,

globally. international. in in improved both we North America strong and So have had Markets orders

core comment succeeding remarks. to we growing are it, to Our strengthen in markets clearly markets. will railcar adding my on North continues while strategy as and The strategy later is brief be American to international I in our

for we April the led April few I and to am to our want rail healthy see are morning, the a make activity and guidance touch freight going outlook transportation. provided this As few questions. have global -- release that reaffirming about economy we indicates, for strategy; press market remarks year. on the in I the as time favors our it, economy, macroeconomic car conditions, to a first the positive comments leaving

And crude as This in For United resulted well America, in States, business example, basin well strong North higher strong North in as remains oil appears the Permian rail included as on carloads trade healthy. uncertainty. in several in production recent be also consumer U.S. tariffs. proposed including as --among Achieved America. unpredictability and those intermodal very the spending increased near internationally loadings economic highs. would environment policy, all-time and Political fronts at an enacted ongoing above

economies XXXX for Historically, recently, by traffic. truck With both domain our velocity for new Through X.X% has the rates, I and emphasize traffic. not X.X% indicate, Year-to-date, this remarks business. the are the intermodal think up until and but the our by again demand demand Stifel downstream ever chemicals. to stronger crude Most optimism, U.S. day, prices, and for demand U.S. by projected tank ship disciplined the good indeed lease declined recent oil as lower which with than We're year-over-year of that and increased week, seeing these and we was case, of aligns to hauls, all quite remarks tank continue both All cars, shorter plastic since slower business intermodal and for this and are recently the capacity of our has Stifel, drive used vessels Pressure up X.X% correlated on trucking, weakening Elkott production positive and lease very industrial start pellet with rising rail at better train that intermodal of businesses. than know, both state shipment that's our rail for the weekly industry by equipment, on to largely would and speeds XXXX, good, was a that and worth are the bullet a XXXX And constraints, the chemicals. were per best serving cars loadings approach lot In reading, barrels railcar demand is are are So we Cowen for XXXX. train that far economy offers, even global well increased rail. way colleagues. think Increased sand of the morning. restricted very compared railcar reason plus doing by specialty capacity as commentaries Average announcements, you remarks. past XXX,XXX now even primary a demand and that finished will driven of a America we OPEC to if Cowen competitiveness including railcar ensure for years key our for will positive for we our aside, over and increases, year the rail strong setting the both car pressure tank a year-over-year. we all see to for have for taking only our as cars two emerged in oil very, rail Company. concerning car like have to the several loadings signs rates Matt and seen benefit for production and Cowen morning demand. May some mode in railcar earlier expected continues

exerting discipline. We pricing enhancement for are hoping margin by

us sheet with significant in to as GBW opportunities. and distribution at Watco, we results. has growth balance activity has partner an our drag in optionality Greenbrier's to been provides ongoing financial is as not the earnings. and producing out the returns strengthen carried disappointing delivered has space flexibility capital expected, investment with for on repair continued and for and Our well shareholders, investment This

with of our consideration welfare GBW working solution come will we our and and We’re closely expect the which include a of customers this, to partner, to on careful employees.

international strategies excited I'm in acquisition is Europe integration on are working, Our about track. also those

We are more and in Poland efficient Romania. our both making trimming operations and down

GBW fiscal We car in pillars. improving have America number gives is from new at one, planning. in top Europe significant a and one, the of commitment good course carried almost also now domestically countries value. two employees in of global two so with footprints, our synergy year new have confident X,XXX springboard to to out strength that total in guidance. year with our a for stage. strategy operating for summary, on rates region, our as pipeline Many last have business follows: Freight other strategy next business increased from completing the strategy We us of improving. balance quarter and the we’ve all well and enjoying of the Number of international. to experience our the added customers model. in Number four, And takeaways North except both strategy that. deep production improve sheet GCC. globally good knowhow Based to use shareholder In Number succession parts And and we with and the two and we to current year allows these our schedules, business reaffirmed over the look the we are scale. target and the we're building elements we’re Things our and global remain secondly, deploy long-term marketplace, doing a fiscal the business core supplemented grow. a In in our fiscal addressing the three, talent to are our quarter. results and on and have on customers to our capital a XXXX, integrated forward strong guidance

turn over to I’ll Now, back Lori our to this Justin.

Lorie Tekorius

Bill Thank you, morning good everyone. and

confident strong The XXXX, on year. achieving guidance third momentum the for we’re continued quarter our in fiscal the and

information then Our for $XX.X quarterly are of include the earnings available a and or highlights per million. adjusted on slides I’ll and EBITDA just in on full of supplemental $XXX.X million guidance the the and financial for hit Justin $XX.X the third quarter few $X.XX year. share release, diluted the adjusted Highlights revenue quarter press million for and earlier color today, provide indicated, released metrics of

negatively or goodwill share recognized per $X.XX with charge a Our associated by earnings impairment non-cash million impacted a $X.X by were GBW.

As Bill indicated, underperform this operation expectations. our continues to

units under equity our earnings delivered our loss XX% our for third the Over a North the share impairment on method, of reflecting GBW statement. we including expanded reflected X,XXX account America, are the quarter outside of in as our affiliates income result, from footprint. international As in charge, were unconsolidated

execute unites, aggregate continue across gross We of XX.X%. margins well posted to business all and operationally

driven by syndication cash operating including strong of flow Our activities. operating million was performance, $XX

of years, MUL units, year. X,XXX our totaled X,XXX the order intermodal, This As automotive aside setting and strongest Bill average over in size larger activity be quarter last orders orders indicated, $XXX broad sales cars. the in at types, multiyear units X.X box American million. order price non-linear. And a range while from was comprise market third the and These continue quarter railcar mix valued the units, of including from in to hoppers railcars, benefited a the tanks, North competitive

is sheet business. and provides grow robust Our to flexibility balance the

return announced be is in XX% quarterly to flow production in our create borrowings XXXX cash Greenbrier-Maxion on of on employed. current $XXX strategy, capital to Our X% seeing including increases recent dividend, steady $X.XX about our Based XXXX, shareholder Brazil. long-term about value. strategy in confident exceed current credit approximately in continue a fiscal XXth We share. generates cash has to for the deliveries to and most capital and and X% facilities cash trends point, business of million, The available that million. history balances yield allocation the XX,XXX dividend remain $XXX units, of consecutive include XX,XXX the focusing expect we Greenbrier increase will from schedules and per This and which dividend. April on On generation today

$X.X including act. GBW the expect billion the $X.XX the We approximately $X.XX be $X, goodwill the from but non-recurring and of impairment, impact revenues excluding share net our diluted EPS per to of tax benefit

we over share to share Now the adjustment and rate $X.XX which offset U.S. tax the non-recurring XX%. the few net the benefit XXth on February tax $X.XX balance taxes per tax of sheet, we per re-invested This second share rate deferred That generated re-measurement the additional over from benefit; partially of new earnings, an the pieces; ended the the two per for domestic received quarter. then and six of of on a benefit. transition have by in approximately of months blended questions $X.XX resulted foreign the benefit XX% discussed about income the last in quarter, consisted

nature. in in do that share indicative normal about non-cash those and not to part the second So The lower It quarter. a $X.XX from non-recurring adjustment ongoing not of to of we the the We tax is per doing the two benefit operation. consider now combined rate earnings. view talked business, and we be are $X.XX U.S. benefit largely is

be international on Now $XX of leased to market. $XXX and sale will are And the generation of we our develop million growth strategic that $XX initiating results moving assets. on $XXX for Brazilian our the including to team. as goals, result next our And with is operations. from order the to platform, strengthen a to at about are still stronger affiliates in business million and expect secondary G&A not Growth we’re be of of reminder, be to about of reflect amortization fleet our and $XXX as GBW are year, expense the are rebalancing million. $XXX be a capital we investing Days Depreciation proceeds share the In from our million leaders million earnings operations of so expenditures global unconsolidated development primarily accomplish our a and expected consolidated, from sale to rest program full million. about expected Greenbrier. activity

operations continued May challenging trucking quarter, Brazil a in Our driven had economic strike by a headwinds. and largely

breakeven of the investment and headwinds We and $X to fourth line continue expect a Brazil. to this quarter, the in lingering Reflecting Brazilian believe our in item. rail market freight of loss in the in GBW the long-term potential million we

XXXX million. interest to attributable We earnings to expect to be $XX non-controlling million $XX

Mexico reminder, and a in interest in GIMSA our Rail partner non-controlling represents share Europe. the As of Greenbrier-Astra results of

fourth Our rate for consolidated XX%. to is tax around be the expected quarter

capital, about of items. that other focused to as on due we’re mix To human our fluctuates we'll will and all And international rate excited questions. This sum We're growth as earnings an benefit up, Our discrete footprint. it reverse open future. strategy of stakeholders. it Greenbrier for well up includes now geographic

Operator

much so speakers you. you [Operator for Thank Instructions] waiting. Thank

from first comes Matt The question Elkott.

open. now is Your line

Matt Elkott

order the I just clearly. understand to I front, On the want commentary make sure

X,XXX, customers? order was that it So there outsized bunch no a in of was one-off included

Bill Furman

We’ll have right him. in the stats respond of he’s got front to Justin that,

Justin Roberts

You’re was variety was from one it in types, perspective. large correct, variety car very there, in there’s customers, of organic nature off no a of orders that and it

Matt Elkott

is So an would now? ongoing right of you say momentum happening part this still that’s

Justin Roberts

that’s say it what would seems be, I to yes.

been translation to spoken, to it’s and from improvement process and North stronger we we’ve a As America activity. of seem a order be seeing activity in inquiry gradual

Bill Furman

you what just I consistent to morning, the in a Matt, wrote commentary, which I XXXX trough. believe this your chance that read personally had was

all We much are more range seeing types of the interest. of car across the

may to issues, roaring a of -- I XXXX sideline. the suppliers think way lastly which and the up. velocity people in because that think think going important. the some start, I is intermodal, rail, to off have still be There are a of favor But cases really I -- and been trade of particularly out XXXX on bit hesitation is shake in is calendar that's

see through the So second half going momentum of year, we the year well XXXX. this into and calendar

Our increased pipeline as has well.

Matt Elkott

based least not match it far-fetched be on to activity think order as far -- if XXXX, getting, at that ASPs of could XXXX XXXX you're and be as this could would the that earnings, even exceeded? Speaking

Bill Furman

am let before us to to trying aside Board going and -- that, respond because has Board and always you Lorie guidance the the guys I earnings get we issue them. budgets to our approved finish put are to

I Lorie allowed mean, answer won’t question. let I I am to not So to to that. me allow -- am that am they always optimistic. answer I going answer

Lorie Tekorius

I Bill. for am indicated, schedules believe Bill you, as But as I Thank haven’t our finalized optimistic well. production we XXXX.

it all We’re knitting still together. and looking at that

lot there of and One one, mix downsides, a a international to accumulate. to becoming more we larger have footprint, is information with if much company product and the broader

of whether would going. XXXX, XXXX, say we’re very it’s I the future So excited XXXX, we’re excited we’re Greenbrier, where about about

Matt Elkott

U.S. market if one just and this I for question, American correctly. your me last situation from and of sell know put Mexico, then have actually comes about finished can you production advantage non-U.S. -- U.S. tell you And acquire guys tariff and you at And I'm this steel steel the we North an thinking this most the goods given in guys does the into

finished Mexico? tariff on products So on goods, you the there acquire is sell like no steel finished assuming and at goods, prices the railcars, added from lower coming

Bill Furman

Matt if to we the It comment would case disposed probably on that not observation. current given be the certainly it were situation. political is an interesting

have States. flagship in United our factory, actual We is -- the Gunderson,

there. go see a with to as of may see We to they'd a have advantage have to would temporary be temporary through snake, But to pretty there much pass increases particularly transportation something car deal point policy We for as makers. certain much a highlight they’ll of builders advantages, level it. Mexico awkward suppliers. as in some it's -- all the not tariffs everything like the the today you and enacted and out. We through is I going for leveler again, passes bit steel a and We it’s want it’s to But to pretty now out. bulge currently in

Matt Elkott

that went And is prices much just But a Xth ASP very since weekend. Friday steel it's question How going the due busy last a before of last It's up? from call. quarter. significantly one not probably up to of the July

Lorie Tekorius

going for has lot following mix time, Matt, so a of driven a from and large which behind hoppers waiting car tubes is a number on whether indicates smaller what's ASP. I you of think the depending much cars, know of large there's it or in cars, as the how the long -- really cars mix really by box materials types, the really more or covered the us it’s

Bill Furman

orders way the that leavening degree more can it drive higher price, the which intermodal is mix, priced to And have down cars you and the drive up.

been not This linear. the said we've order the as the order and a earnings and quarter. seeing. base rates we're homogeneity good that many are We're broad-base very happy has and So times, about our

Operator

comes next of Thank Long The you. Justin Stephens. from question

now open. is Your line

Justin Long

order from from North versus many America split also first North little and backlog you if And international? at between me I Could on more you is a in on today, question the get look America color you third the guess bit how give the came book quarter. international? could that orders

Bill Furman

Lorie quarter, orders say addressed the deliveries comparable the for it's to I that backlog. and fair was believe or that well as statistic

Lorie Tekorius

North about outside reminder, say I that's Which, were just would of our and deliveries similar backlog. a orders as of for and American XX%

Justin Long

on months? comment And quarter instances about several how secondly, last the sounds in and getting activity others any I with pricing one-offs. stable know even ask a better? environment little larger over a now to earlier seen like were that's orders. environment continue you bit those last I bit more trended the some year that you aggressive Have pricing the of the is or the It wanted were maybe little there made

Bill Furman

and When it’s take orders, fill lower a with product. push down prices margin little up to you think bit better. factories orders I you take your

there's think the industry. in and responsibility more I discipline

responsible Of a course, and it fill us to or up -- and large, factories them others. powerful if value. about of In they hurt you our been will the are margin our breakeven, run, some against competitors each hurt zero customers with our shareholder and your have they’re doing you of play price the But that. less like than longer

Lorie Tekorius

the were seen But talking discipline you I bit earlier a than about recently, would in year. we’ve say more what more

Justin Roberts

support and which then aftermarkets. And we and on important. delivery quality very, compete Yes, transparency on course, of because very delivery, they’re is of it’s always to the easier customer compete filling up basket and their on

Justin Long

Europe. what's from this the baked XXXX? that any from there is last for think guidance about framework you When of where fiscal help recently next EPS in talked into Astra think me, go? number more us could year, can year you’ve about the about one for momentum you in And terms And contribution

Justin Roberts

Well, can per as after add on basis we said before, like net. on to accretion an it we $X.XX share range of feel $X.XX a

recover giving strong that continues we’re piece accomplished Astra, feel we far. European the so be not integration guidance the on explicitly strong as While on as for a for very XXXX, to we’ve will the market year footing do XXXX proceeds that and

Bill Furman

in focus Integrating see, Yes, certainly this expect from together. more needs getting in or no tailwind next a would on we basic small year. Astra whether We is earnings shops absolute relatively speaking, relative We it substance might undertaking. to at an we basis and not for year, six Romania, have which five, from in it set earlier. XXXX Poland short-term Astra, goals,

the -- rest engineering of Latin as large is an Latin Africa. as North in have a that Brazil but all synergies synergies Further, base takeaway and of to Middle customer East from real this. springboard think the I we and designed of on America, activity for international alternative broad we springboard that’s America, have a the a not also market America, and

a with temporarily on are have as little being awarded negative We down concessions there. the -- result going

expect base earnings we going front. is stronger and that things So some balance we there would and performance performer can optionality…. improve are a and our grow thereto, international on on where solid we diversity that international On exciting

Operator

next comes Bank question you. Merrill Thank Rosa of Ari America from The from Lynch.

open. is line Your now

Ari Rosa

is and discuss about have it seeing new that for really that like now people quickly, there and a I are the where the of that year supply orders. market ago Is back improved being are something hoping, narrative regulatory is you you it you you year a market go really few that evolution seemed of of the if Or creating concerned could a little that's driven in to else the environment over orders reversed. uplift? So, demand? kind or market lot that what Because just seems an two a by bit changes? that seeing tank and years, you there of or that was tank mentioned car think driving that and car was from if

Bill Furman

$XX,XXX that sorrow one. important that at regulatory some positive changes the GBW That's of contribution are to a as might been at actually our a when require driving cars our car think look of to of a great to this of is work, because, factor. very, very The and working get dates forces on very DOT-XXX are deal That's retrofit closer program to as I expected relevance great a you question which time. have that go $X,XXX industry. work because fleet know and There in mixed the major has people in that for opting decision activity, unit question certainly the it's not of program we slick closely is a

bit on Basin all And little it's by of is and just boost general Canadian production that and car a not seeing there. for new Permian it's However, factor. that rail. situation, market, on if the in monitoring lift say lift, fluidity in by that strengthening rail, of sluggishness going side, it's a good big shortages the I'd from traffic, lastly, certainly oil railcar the on it's are there's been and great the demand a down a a the in trends good Canadian that's you -- you're not a big but regard regard car oil great a than haul. with news It at

can rails lot pressure a on. line there's the vessels, to primary and lots, cars. answer not to a of been of However, a There's been been our we've whole the source smaller tan in it's do it's possible different other of a vessels tank diversified for which for by cars, cars the derivative us into tanks. oil -- whole demand model lot get what's pressure has not lot as and And question, type improved of going

Ari Rosa

or that the just GBW, forward? elucidate about just salvageable on to if more be? there going you it’s ask you then a maybe think thinking to And about challenges could be if bit wanted And seem second what we how little should

Bill Furman

a fact plan, a very we’ve that execution car of tank got Well, lot in practical but of people, derived am execution quantities built way. haven’t different thinking retrofits dedicated dedicated ball that the our hampered expected showed fact lot for and for entire a about time I like, of the market the field which that we was course to by I expectation turned and come the heavy in business, That changing that we in The would it positive of maybe The along the was on customers the that know is demand up over the network. nobody is game. way of the the retrofits. be

Second thing that happened is it’s a scale issue.

at, We in have difficult two utilization, at different a network Deliverance of each given and have seem It operator. became then to national network. shops producing some of has operator. can’t seem We and efficiency -- of Cowan suddenly it, created also scale histories began administrations. running we great Jim the been just Rick a diseconomies under Web to had national good the running more a We very scale. losses

want the take drag So, are that at look the been, if to on looking we scale, practically we’re transactional drag, to has share working capital just and to speaking earnings solution on our this issue. just you the different stopping we at costs, either

distraction our have size So, on this joint won't this we venture of repair nor drag earnings business. the from

Operator

KeyBanc The from comes Steve Thank Capital Markets. question next Barger, you.

line Your now open. is

Steve Barger

had how an if capacity Bill, I your and cycle. comments improving about you liquidity balance in ever this you've prepared early much talked much in doubt, you have this sheet

and investment domestically for So about little opportunities can see you internationally? talk you a more the

Bill Furman

Steve, question. I think, excellent

are have the We things hold said, can’t strong market feel I’ve improving. domestic that. now that a on the now has strategies, check Our like on -- box we we

are our core are And nicely, number a We improving we’ve have in -- North internationally. mission there. America, two, very most expanding but and business of things achieved

that are aggressive the last North have the below the achieve of we for our grow regard. leg active Company, down building in we areas, we those do short, our count scale development and of domestic So, so business and and believe In includes have business, pursuing markets we and of international in our more year we recruitment, to transactions growth focusing core both to pipeline and going on. future afford the have and that but far we our in added to in proportionately for at that probably middle-management scale can programs, on American of that

So, we and areas freight growth leasing. engineering, equipment at we our talent in core design in of have businesses, for space, opportunities areas, which design, our rail, our those are looking car the one manufacturing,

and also negative wheels business, the parts business, integrated contributes have to business very though dedicated continue addressing We it to repair that -- be even profitable must our even we model. and have active in we still however, we results, to that when be

are we're business along So wheels of where our repair increase leasing. having or and manufacturing to aside scale setting we categories and businesses headwinds, likely engineering primary our with one the parts

Steve Barger

cyclicality? the Or Is capital designed you more lines? to the less think reduce do deployment those about scale and about along diversification

Bill Furman

you and understanding very well, on are thing diversifying transactions do in between Europe, well, better Eastern a well, There's without core. what amazing International and do in in come we do an you're once to adding though, planted diversifies focus base. in we interested as examining off, on lot the we country basis a industries pieces of going marginal optionality, that but actively. a kind have out think GCC I just you it's opportunities both a our network of strengthening your in if or you us both flag we our what the think a and region what region and just bits about thinking we're we probably Well, so relevant and probably

be, consistent scale will will current Some business. they'll not some with and be at our be but

liquid, yield itself on focused However, appropriately that's only a is part basis very-very of a our a it. of We and -- good tons as company returning profile. true reasonable we such a capital not are XXX and on to to cap just has liquidity will Lorie market got to a you be got add arbitrage shareholders. billion EBITDA dividend of indicates, deploy We capital we the million the continue that It that's of X.X you if earnings.

Steve Barger

that optimism the allocation? mean, expressing term been near the shares companies in you're term, industrial been move all how the Does and I capital that you, well, buyback have for of, a up obviously in just not acting. near the there's between Right, disconnect but and list

Bill Furman

clear I -- dividends. in that's long-term a base the are in think base that's trading interested out to preference We exhibited governance. of and for opposed attract a as we think stock. We're stronger studying dividends institutional

still proxy than noticed substance different might We're a we it's completely a are investor. You where attentive, we're year we can be was we into back trying range or basically, that certainly really attract But two afford, move really -- is last our kind if and year would and were to stock. to focused of it's ago. this our stocks buying on it something

bought back stock in a it down week, trading the say lot as I would have In just recent did, this attention. circumstances it way stock our last got certainly warranted. We of weeks, have

in that have to we we're So, it. policy place and attentive very

Operator

from question Majors The Susquehanna. next of comes Bascome

now line Your is open.

Bascome Majors

be I anything What you can I want believe to for haven’t go us. would tell a said GBW what sort can is line out a what of -- look know like, JV. feel point planned up you equity exercise away, on that would mostly us we you've there but follow else else income will if better want is exit the just but in wholly thought that you Brazil, that to which that were I that so the to to get for helpful?

Bill Furman

This Bascome? is you Majors, Are right? Bascome

Bascome Majors

Yes, that’s right.

Bill Furman

let address all Lorie that identify question. didn't Because I’ll you right. yourself,

Lorie Tekorius

in investment largest here and joint are are from is subs are which a venture that the The the we in States. venture Brazilian have United joint Castings, There you GBW are two in Castings operations. items unconsolidated our few smaller earnings Ohio that So, Bascome. right a items

investments that small into a other really of few getting whole don’t detail. a a to lot have rise We

that think reduce concessions that definitely little we move that the have predictable. should that’s are a is the when with on that a railroads we exactly of bit plan be the associated is economy to we it harder that’s and timing going which a So, GBW comes impact to Brazil, the headwinds in lot and we focused that There as demand. forward. timing those

where we are excited shift. and excited it's it's investment. are being going about predict growth, we So, said hard We Brazil but our like exactly to about think today, I the that's earlier to long-term really in

Bill Furman

So very about good description. and to more think, I be the that gave concise Lorie,

in reduce Our contribution is will contribution be goal add to to positive performance that sources be from will Brazilian relevant all temporary. XXXX. negative which in very thing a XXXX and

you to we The demand look couple a pause. order has there been and ago, of big up. quarters election's there If are coming just getting down

operation. I Some have a very things elections about Lorie I we but be is not going in around where Brazil, are been that. excited personal and here, and other plus are restructuring think to taking is of a of same because pause down am beaches expect fever turn to temporary sizing this the are in or that the held, XXXX. areas a interest in Zika going by on and and it early that viruses country spite we all in that’s yellow and great

just away to of make and you if look personal make it goal evaluating it bluntly. be positive my item, That’s on sure. go And So, my at goal. it I’ll put that I'm Directors, line by Board is to that our

it lot about really haven’t is. a shown I concern they know what strategy because of our Although,

Bascome Majors

So that’s hear. good to

you opposed mean drag you I well that in to will for overall a So XXXX. contribution guys as be a probably as

that you very you're any Just there given sell that specific over sale sort based the one sense relationship of related visibility like mean that look there imagine to willing long visibility that's next to have can so do I the able on this the given on benefit fleet. railcars with I gain year? those share to that [MUL] may Is a of you year. share many now roughly them? item more relationship, on, pretty What you there's strong your have this from of have mean much can't just number been sustainable only period I little could -- kind that you been year? But them it's a the how to

Bill Furman

will said Lorie it attracted to us. But be is but the everything answer to still -- in respect well fact the Lorie creates the you We the basis. is on -- these drag basis if it on depreciation sell -- because Yes, as by before, try you we earnings slapping depreciation actually we're that's some and not allowed sure highly I’m multiyear because tell relationship it’s as a question. has your know to a

laws, what great replenishing with So a new we the the it's fleet are tray. of tax doing is

a we four could multiyear So, on this years. have and go agreement for

Lorie Justin. guidance, I quantitative to As over that to would and turn

Lorie Tekorius

Bill. Thanks

for as we said I as think on our us range doing sales what normal to opportunity well as gains for of of lease because great we're XXXX, did than rebalance we it's a to expect fleet. with be higher activity MULs our

on we track you it saw change to probably I but XXXX. annual might go conditions, million to that million in we probably think know at on based gains reason don't as I I to forward, will look our $XX range on historically, if market the off were don’t be from have level $XX we had any basis. see sales. what record, an

Justin Roberts

you've than our strong The happened where at momentum it's couple that the much because our then possible have gains lower years, markets. can rates we find Yes, and the assets on the gives us if look capability got to exists if if from have statements compare and to sale, syndication last that more qualify capital, a changes cost interest markets hard we leasing them. they very of for our sell you we sees opportunities growth them of delivered the really cheapest that stronger buy model that company. and And engine in trading

a in the is base MUL recent well engine leasing we has strategy this very of that been gain be on will so in that of strong have we leasing the investors to business whom a where that long-term investors with Our a wholesale diversified including an to working is really sale. we but expect continue very and relationships. some companies strong comes excitement gain some space of continue one, have

Bascome Majors

more least to need year, the guidance for it had one a been. looks next at bit just EPS of kind where it this for of number from the manufacturing quarter. that I small to down remainder does portion to step will get your to mean at I we've seem one like the margin

Just that as runway mix, you want year? think conservatism, we're you're else we that's is to of to between maybe the next what implying want understand out kind make fundamental heading driving about I that drivers into anything sure the point and

Justin Roberts

Bascome, Justin. this is

of of a do -- of of projecting a our than step if discussing cliff the I which as can I and platform today. think been that's kind mark of that year call But a have of we're range again, expecting additional be little probably our a better for have of it most I to not event our that perform we’ve margins leasing the continued detail as well. is and we've down, any a not bit XX% and to there testament of we you talk think about to GRS manufacturing but talked just a been follow-up expect the business we later get, we've follow-up, that, we on more the before, in matter other our and around and strength operating bit efficiency kind going type about could

Bill Furman

both conservative, soon I'm them. as going get Lorie as Bascome people. a and They’re fantastic promote Justin less to

to the going we're So, year end strong.

our have all business we we momentum. -- not is in next strong think But things, linear. it’s not into year, Going

delivered good some successfully other We we’ve really parts. just a So in got Arabia. moving Saudi contract

a opportunities We lot managing Council, of in even Ukraine. the and the visibility GCC, quarter-to-quarter region in of surrounding the in There’s Gulf business for growth a the Cooperative lot and and earnings. the not we’re have Turkey

as So our soon give it, as official blessed as ends, and ends soon year the we have optimistic maybe is the really Board as have well. has to in August mix in the an as cycle as guidance budget game going as it. I think always and to and a strategy going fiscal our -- soon next before value but more we’re lot That we got two you guys deliver give plan years, year working great then to nature, really and our transparency. But an will three next we’re I

Operator

from Matt The next you. question Buckingham Research. Thank comes of Brooklier

now is line open. Your

Matt Brooklier

of Could demand you far quarter for give this a little activity thus color on railcars? bit

Justin Roberts

far I is would earlier, -- I as that surprised the we’re this order I to I another by optimistic strong will activity translating be mean cautiously we’re quarter. would said Matt, that this and pleasantly fiscal a order is inquiry it’s just -- our say Justin. QX say so -- the activity activity,

Bill Furman

loadings to be. we you probably in of in lot and specific likely is orders? the we are of these just of the the see booking activity can and moment activity are markets some Yes, to track Yes, and your questions, where A continues. stats

Matt Brooklier

you third cars crude any Did guys in your quarter? book tank fiscal

Justin Roberts

Justin. Matt, is again, this

taken of that variety a we’ve have We for. cars tank orders

to car cars. explicit car of a broad car get try of the type we by variety it's not So in tank But type.

Bill Furman

isn’t think I answer the is But yes, it?

Justin Roberts

yes. is answer The

Matt Brooklier

cars? think taking to cars, longer story I are do GBW. maybe of market to guess or many not and going as quickly Bill’s some back is adding maybe comments expected it to materializing, going over on little the -- Or Is new crude retrofits it’s that that for as you develop? retrofit cars? as we Is the just it for here retrofitting for cars bit previously preference

Bill Furman

I impression. the I you hope give didn’t

just huge the particular, to in of It back because they railroads taking would in car retrofitting wasn't when demand, now, the also regulations pioneered tank time concerned be cars. others about this the retrofitting wave because the not effect car We’re think we didn't were going particular, there. invested in the the too tank capacity industry sacred early

and we’re also to with able we we enjoying surf those And on wave to Car, move had were ours, expected a we different of number putting market, -- overbuilt different what a in, the to service of it's really it’s XX we're but but difficult shops ready competing that consistency be not great partner we're the not the our networks more the shop and was we was retrofit bathe it’s in our not design, from very way together enjoying and couple a is together buttoned shops on around especially was histories, that with execution very a able were on we sure so weren’t nice drag some misjudged company acquisitions, wave. of wasn't issues so or that It just than down, just big down put but buttoned -- times. this It’s -- lot we're to was it execute relationship with activity So with healthy cultures like just customers. Watco. coming huge not on it are and a that not that -- earnings -- not we Union meaning and Tank

we're but GBW it, at Mexican facilities. in we are just to not but on in Greenbrier going retrofitting in So, only itself work cars our

Operator

Mike Baudendistel Stifel. you. the comes question of Thank last from And

Your now is line open.

Mike Baudendistel

sand sourced I multi Most just of frac my questions of covered customers at if given your the wondering, hoppers sites? just were more expectation to ask was one. that the more there's will that's local ordering answered. that sand be quick cars I'll stopped a place drilling

Bill Furman

replenish and may Personally, the the not wells kind I'm pretty cycle of should. mentioning yet. you're not of car aware but be That factors. there, following for to as just I of is any on that as now alternative closely both from of that sources, the trend availability certainly there's I strong effect they're the big especially, existing right, having demand sand

if flavor that on people to, on give I'm that's of to more not we something to If that, might decide sure. on, we I'm other interest sure publish and market, you wanted later

Lorie Tekorius

for well great the as great you we're everyone results third the your I has for weekend Thank a appreciate July. really and attention and interest Greenbrier outlook time, and Xth quarter a in beyond strategy. everyone. our growth about Hope as the XXXX Companies. our Again, excited of

Operator

your today's for concludes That conference. participation. Thank you

now disconnect. You may

The Greenbrier Companies, Inc. (GBX) 29 Jun 182018 Q3 Earnings call transcript