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Trinity Industries, Inc. Reports Strong Second Quarter 2013 Results And Increases Full Year 2013 Earnings Guidance

Stocks in this article: TRN

“As reflected by our consolidated results, Trinity maintained its positive momentum during the second quarter, and we expect this trend to continue throughout the year,” said Timothy R. Wallace, Trinity's Chairman, CEO, and President. “Our Rail Group, Energy Equipment Group, and Construction Products Group each recorded solid operating results compared to prior quarters. I am pleased with their results. We continued to receive orders for products that serve the oil, gas, and chemical industries. The amount of backlog visibility we have in our major businesses provides us opportunities to continue to generate additional operating efficiencies. Our outlook for the future remains positive.”

Business Group Results

In the second quarter of 2013, the Rail Group reported revenues of $668.0 million and a record operating profit of $107.9 million, an increase compared to the second quarter of 2012 of 29% and 104%, respectively. The Rail Group shipped 5,600 railcars and received orders for 5,000 railcars during the second quarter. The Rail Group backlog remained at $5.1 billion at June 30, 2013, representing 40,665 railcars, compared to a backlog of $5.1 billion as of March 31, 2013, representing 41,265 railcars.

During the second quarter of 2013, the Railcar Leasing and Management Services Group reported leasing and management revenues of $150.7 million compared to $132.0 million in the second quarter of 2012 due to continued growth in the lease fleet and higher rental rates. In addition, the Group recognized revenue of $18.9 million from sales of railcars from the lease fleet owned for less than a year during the second quarter compared to $62.2 million in the second quarter of 2012. Proceeds from the sale of railcars from the lease fleet owned for more than a year at the time of sale are not included in revenue and totaled $8.5 million in the second quarter of 2013 and $7.6 million in the second quarter of 2012. Operating profit for this Group was $75.7 million for the second quarter of 2013 compared to an operating profit of $76.4 million during the second quarter of 2012. Included in the operating results for the second quarter of 2013 was $4.7 million of profit from railcar sales totaling $27.4 million compared to $15.1 million of profit from railcar sales totaling $69.8 million for the same period last year. Operating profit from operations increased for the three months ended June 30, 2013 compared to the same period last year primarily due to higher rental rates and lease fleet growth.

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