Trinity Industries, Inc., in announcing earnings results for the first quarter ended March 31, 2013, noted that the company’s Rail Group received orders for 14,505 new railcars during the first quarter, increasing the backlog to a record 41,265 units with a record value of $5.1 billion.
The company reported net income of $79.1 million, or $0.99 per common diluted share, for the quarter, and net income from continuing operations of $72.2 million, or $0.91 per common diluted share. Net income from continuing operations for the same quarter of 2012 was $52.4 million, or $0.66 per common diluted share. Revenues increased 4% to $932.9 million, compared to revenues of $896.2 million for the same quarter of 2012. The company reported an operating profit of $159.5 million, a 30% increase compared to an operating profit of $122.7 million for the same quarter last year.
Trinity’s Rail Group reported revenues of $625.5 million and an operating profit of $102.9 million, an increase compared to the first quarter of 2012 of 34% and 157%, respectively. The Rail Group shipped 5,230 railcars and received orders for 14,505 railcars during the first quarter. The Rail Group backlog increased to a record $5.1 billion, representing a record 41,265 railcars, compared to a backlog of $3.7 billion as of December 31, 2012, representing 31,990 railcars.
During the first quarter of 2013, the Railcar Leasing and Management Services Group reported leasing and management revenues of $134.3 million compared to $127.4 million in the first quarter of 2012 due to continued growth in the lease fleet and higher rental rates. In addition, the Group recognized revenue of $0.1 million from sales of railcars from the lease fleet owned for less than one year during the first quarter, compared to $14.9 million in 2012. Proceeds from the sale of railcars from the lease fleet owned for more than one year at the time of sale are not included in revenue and totaled $30.6 million in the first quarter of 2013 and $26.5 million in 2012. The operating profit for this Group was $61.6 million for the first quarter, compared to an operating profit of $66.5 million in 2012. Included in the operating results for the first quarter of 2013 was $6.8 million of profit from railcar sales totaling $30.7 million, compared to $6.6 million for the same period last year. Operating profit decreased for the three months ended March 31, 2013, compared to the same period last year, primarily due to higher maintenance and selling, engineering, and administrative expenses.
“I am pleased with our strong financial results for the first quarter,” said Trinity Chairman, CEO, and President Timothy R. Wallace. “Our performance was positively impacted by our ability to align our manufacturing capacity with the strong demand for our products that serve the oil, gas, and chemical industries. Our employees are doing an outstanding job of converting production capacity to meet customer needs for products that support these industries. Demand for railcars that serve the oil, gas, and chemical industries in North America surged during the first quarter , contributing to a record backlog for the Rail Group of $5.1 billion. We achieved additional operating efficiencies during the quarter, most noticeably in the Rail Group.”
Trinity’s earnings guidance for the second quarter of 2013 is between $0.88 and $0.95 per common diluted share, compared to $0.84 per common diluted share in the second quarter of 2012. For the full year of 2013, the company anticipates total earnings per common diluted share, including the effects of discontinued operations, of between $3.80 and $4.05, compared to full year earnings per common diluted share of $3.19 in 2012. “Results for the second quarter and full year 2013 could be impacted by a number of factors, including, among others: the operating leverage and efficiencies that can be achieved by the company’s manufacturing businesses; the level of sales and profitability of railcars; the amount of profit eliminations due to railcar additions to the Leasing Group; and the impact of weather conditions,” Trinity said.
