Textainer’s adjusted net income benefited from higher revenue from an increase in the size of the owned container fleet, offset by an increase in interest expense due to an increase in debt required to fund the expansion of our owned fleet and increased depreciation expense due to our record level of capex and higher new container prices, which have averaged almost $2,400 per CEU in 2012. During the third quarters of 2012 and 2011, the Company released liabilities for unrecognized tax benefits and recognized tax provision reductions of $3.0 million and $3.2 million, respectively.
During the quarter, Textainer completed a follow-on equity offering of 8,625,000 of its common shares at a price of $31.50 per share. The Company sold 6,125,000 new common shares and our largest shareholder, Halco Holdings Inc., sold 2,500,000 of its existing common shares. The Company received $185.2 million and Halco Holdings Inc. received $75.6 million, in each case net of underwriting discount and before expenses.
Textainer Limited, one of Textainer’s wholly owned subsidiaries, also increased the size of its revolving credit agreement from $205 million to $600 million, adding nine new participating banks. At the closing, the initial interest rate was LIBOR plus 150 basis points. The facility also provides for a $100 million increase the Company may elect to utilize subject to certain conditions.
Textainer ended the quarter with a debt-to-equity ratio of 2.0:1. Year-to-date the Company has completed approximately $2.4 billion of financing in the debt and equity markets, resulting in over $1.3 billion in net incremental funding. This additional liquidity puts the Company in a strong position to continue purchasing both new and used containers to meet the needs of shipping lines and address their increased preference to lease containers.Outlook “Even if trade growth were to moderate in 2013, we believe we will continue to have solid fleet growth and performance because of shipping lines’ increased reliance on container lessors,” commented Mr. Brewer. “Container lessors are projected to provide more than 65% of all new container demand this year and could meet or exceed 70% next year. We expect utilization levels to remain high, given that 81% of our fleet is subject to long-term and financing leases, increased sales of older containers, relatively low levels of container production and limited new shipping line investment in containers. These factors, coupled with our continued investments in purchase leasebacks and acquisitions of our managed fleet, position us to continue to grow our market share, provide consistent financial results and maintain our market leading position.”