CHICAGO Greenbrier Cos. Inc. has fallen sharply into the red. The rail car and barge builder posted a net loss of $56.03 million in its fiscal third quarter ended May 31 in contrast to net income of $19.12 million in the same period last year on revenue that fell 14.6 percent to $433.66 million.
Results were negatively affected by a goodwill impairment charge of $71.8 million related to the companys wheels, repair and parts business. The Lake Oswego, Ore.-based company, which said it will make improvements at six of its 38 facilities and close or sell eight underperforming repair shops, has appointed a new manager to turn around the troubled facilities, which employ more than a third of the segments workforce and consume a substantial amount of capital.
Greenbrier revised its forecast build rate downward for fiscal 2013, citing a slow ramp-up of tank car production at its Mexican plant and lower-than-anticipated deliveries of intermodal cars.
However, "we are encouraged by the growth of our diverse backlog and robust order activity, with orders in the third quarter for 5,500 rail car units" valued at $575 million, president and chief executive officer William A. Furman said during an earnings conference call July 2. "Since quarter end, we have received orders for an additional 2,100 rail car units, including an order for 1,500 double-stack intermodal units."
About 37 percent of the 7,600 rail cars ordered since March 1 are for tank cars to be delivered to North American customers. The rest are covered hoppers, automotive carriers, mill gondola cars and double-stack intermodal cars.
"We anticipate brighter prospects for intermodal rail car activity and downstream energy-related rail car products, such as plastics, in fiscal 2014," Furman said. "Our marine outlook is also improving, driven by strong customer inquiries related to transportation of crude oil by barge."
Greenbrier expects to meet production targets in its fiscal fourth quarter and fiscal 2014 first quarter, Furman said.
Industrywide, he said that "tank car fleet additions in North America over the past two years have been robust, emerging from the crude-by-rail story and the North American energy revolution."