LOS ANGELES Greenbrier
Cos. Inc. continues to see an "early-stage recovery" in the
freight transportation sector despite headwinds in some key
Greenbrier, a Lake Oswego,
Ore.-based rail car manufacturer and leaser and wheel
refurbisher, reported net income of $17.7 million in its fiscal
second quarter ended Feb. 29 vs. a loss of $550,000 in the
corresponding period last year. Revenue totaled $458.2 million,
compared with $284.3 million in the year-ago period.
Greenbrier received orders for
3,600 new rail cars in its fiscal second quarter, up from 1,600
in the previous quarter. After the quarter ended, it received
orders for an additional 2,300 units valued at $270 million,
according to the company.
But while orders were on the
rise, Mark Rittenbaum, executive vice president and chief
financial officer, said in a conference call that rail car
production will fall off in the fiscal fourth quarter ending
Aug. 31 from the third quarter due to "line changeovers," as
well as the companys production of new types of
auto-carrying cars that require "more labor" than other
Moreover, the Association of
American Railroads has reported that the number of rail cars in
storage on April 1 increased by 9,819 from a month earlier to
make up 19.6 percent of the North American fleet. Asked about
this change by a securities analyst, president and chief
executive officer William A. Furman attributed it almost
entirely to a declining need for coal cars, a major component
of the rail car market. He also noted a decline in demand for
fracking sand cars due to low natural gas prices.
But he emphasized that the
companys incoming orders have shown an increasing
diversity, particularly in energy-related sectors and gondolas
for transporting steel, as well as for auto carriers, a market
he described as "really hot."
Greenbrier will deliver more
than 15,000 rail cars in the year ending Aug. 31, compared with
9,400 units the previous year and just 2,500 units during the
year ended Aug. 31, 2010, when the company was hit by
cancellations due to the economic recession.