Victor Garcia, Chief Executive Officer of CAI, commented, “We are very pleased with the performance of our company this quarter. We achieved strong revenue and earnings growth, generating $16.5 million of net income, a 21% increase compared to the third quarter of 2011. Utilization has increased slightly during the quarter, and we believe utilization will remain strong for the remainder of 2012.
Demand for new containers is below normal for this time of year. We believe the limited demand for newly built containers is a result of the caution our customers are exercising in committing to additional equipment during a period of economic uncertainty. Consequently, there has been limited incremental investment in new container production, which we believe has kept the supply and demand of containers largely in balance resulting in continuing high utilization of the existing worldwide fleet and strong prices in the secondary container market. Despite the expected 5% global containerized trade growth forecasted this year by Clarkson Research, we expect production of containers for the full year to be below the 2011 level and to largely represent replacement need from our customers. As a result of this low level of new container production, we believe inventory levels at the factories are below what one would normally expect for this time of year, which is likely to lead to increased demand from our customers in 2013 to meet the expected containerized trade growth next year, estimated by Clarkson Research at 7%.”
Mr. Garcia continued, “During the third quarter we invested approximately $150 million and expect our total investment in 2012 will exceed $500 million, another record year of investment for CAI. A significant part of our investment this year has been for sale-leasebacks from shipping lines and the acquisition of assets from our managed container fleet. In July, we acquired $10 million of railcars, bringing our total investment in railcars to $51 million. The third quarter was the first quarter in which we had any meaningful revenue from our rail investments, and these investments are already generating a positive earnings contribution.”