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Textainer Group Holdings Limited Reports Fourth-Quarter And Full-Year 2012 Results And Increases Quarterly Dividend

Management also believes that adjusted net income and adjusted net income per diluted common share are useful in evaluating our operating performance because unrealized (gains) losses on interest rate swaps and caps, net and gain on sale of containers to NCI are both noncash items and unrealized (gains) losses on interest rate swaps and caps, net is a non-operating item. We believe Non-GAAP Measures provide useful information on our earnings from ongoing operations. We believe that adjusted EBITDA provides useful information on our ability to service our long-term debt and other fixed obligations and on our ability to fund our expected growth with internally generated funds. Non-GAAP Measures have limitations as analytical tools, and you should not consider either of them in isolation, or as a substitute for analysis of our operating results or cash flows as reported under GAAP. Some of these limitations are:

  • They do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;
  • They do not reflect changes in, or cash requirements for, our working capital needs;
  • Adjusted EBITDA does not reflect interest expense or cash requirements necessary to service interest or principal payments on our debt;
  • Although depreciation is a noncash charge, the assets being depreciated may be replaced in the future, and neither Adjusted EBITDA, adjusted net income or adjusted net income per diluted common share reflects any cash requirements for such replacements;
  • They are not adjusted for all noncash income or expense items that are reflected in our statements of cash flows; and
  • Other companies in our industry may calculate these measures differently than we do, limiting their usefulness as comparative measures.
       
Three Months Ended Years Ended
December 31, December 31,
  2012     2011     2012     2011  
(Dollars in thousands) (Dollars in thousands)
(Unaudited) (Unaudited)
Reconciliation of adjusted EBITDA:
Net income attributable to Textainer Group Holdings Limited common

shareholders

$ 60,573 $ 54,919 $ 206,950 $ 189,606
Adjustments:
Interest income (43 ) (12 ) (146 ) (32 )
Interest expense 20,195 14,649 72,886 44,891
Realized losses on interest rate swaps and caps, net 2,541 2,654 10,163 10,824
Unrealized (gains) losses on interest rate swaps and caps, net (2,343 ) (1,909 ) (5,527 ) 3,849
Income tax expense (benefit) 372 (3,030 ) 5,493 4,481
Net (loss) income attributable to the noncontrolling interest (454 ) (430 ) (1,887 ) 14,412
Depreciation expense 33,522 21,501 104,844 83,177
Amortization expense 1,140 1,335 5,020 6,110
Gain on sale of containers to noncontrolling interest - - - (19,773 )

Impact of reconciling items on net (loss) income attributable to the noncontrolling interests

  (595 )   (464 )   (2,466 )   (5,333 )
Adjusted EBITDA $ 114,908   $ 89,213   $ 395,330   $ 332,212  
 
 
Net cash provided by operating activities $ 266,527 $ 213,345
Adjustments:
Bad debt expense, net (1,525 ) (3,007 )
Amortization of debt issuance costs (11,700 ) (8,101 )
Amortization of acquired net below market leases 33 411
Amortization of deferred revenue 6,026 9,181
Amortization of unearned income on direct financing and sales-type leases 11,828 9,055
Gains on sale of containers, net 34,837 31,631
Bargain purchase gain 9,441 -
Share-based compensation expense (7,968 ) (6,177 )
Interest income (146 ) (32 )
Interest expense 72,886 44,891
Realized losses on interest rate swaps and caps, net 10,163 10,824
Income tax expense 5,493 4,481
Changes in operating assets and liabilities 1,901 31,043

Impact of reconciling items on net (loss) income attributable to the noncontrolling interests

  (2,466 )   (5,333 )
Adjusted EBITDA $ 395,330   $ 332,212  
 
  Three Months Ended   Years Ended
December 31, December 31,
  2012       2011     2012       2011  
(Dollars in thousands) (Dollars in thousands)
(Unaudited) (Unaudited)
 
Reconciliation of adjusted net income:

Net income attributable to Textainer Group Holdings Limited common shareholders

$ 60,573 $ 54,919 $ 206,950 $ 189,606
Adjustments:
Unrealized (gains) losses on interest rate swaps and caps, net (2,343 ) (1,909 ) (5,527 ) 3,849
Gain on sale of containers to noncontrolling interest - - - (19,773 )

Impact of reconciling items on net (loss) income attributable to noncontrolling interests

  (11 )   (2 )   (224 )   4,517  
Adjusted net income $ 58,219   $ 53,008   $ 201,199   $ 178,199  
 
Reconciliation of adjusted net income per diluted common share:
Net income attributable to Textainer Group Holdings

Limited common shareholders per diluted common share

$ 1.07 $ 1.10 $ 3.96 $ 3.80
Adjustments:
Unrealized (gains) losses on interest rate swaps and caps, net (0.04 ) (0.04 ) (0.11 ) 0.08
Gain on sale of containers to noncontrolling interest - - - (0.39 )

Impact of reconciling items on net (loss) income attributable to noncontrolling interests

  -     -     -     0.09  
Adjusted net income per diluted common share $ 1.03   $ 1.06   $ 3.85   $ 3.58  




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