Trinity Completes Sale of $1B Railcars to Element Financial

Trinity Industries reported Q4/14 net income attributable to Trinity stockholders of $138.2 million, up 22.5% from $112.8 million in Q4/13.
Revenues for Q4 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 of $678.2 million, up over 80% from net income of $375.5 million in 2013. Revenues for the year ended December 31, 2014 were $6.2 billion, a 41% increase compared to revenues of $4.4 billion in 2013.

The following was excerpted from the news release on Railcar Leasing:

During Q4/14, the Railcar Leasing and Management Services Group reported revenues of $238.0 million compared to revenues of $190.8 million during the Q4/13. 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.

Trinity said the increase in revenues and operating profit was due to higher rental rates as well as increased railcar sales from the lease fleet.

During the fourth quarter, the company said that it sold $114.8 million of railcars to Element Financial 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.

Commenting on railcar orders and backlog, Trinity said the 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 record value of $7.2 billion

“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.”

To view the full Trinity Industries news release, click here.

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