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Textainer Group Holdings Limited Reports Record Fourth-Quarter and Full-Year 2011 Results and Increases Quarterly Dividend

Dépèche transmise le 14 février 2012 par Business Wire

Textainer Group Holdings Limited Reports Record Fourth-Quarter and Full-Year 2011 Results and Increases Quarterly Dividend

Textainer Group Holdings Limited Reports Record Fourth-Quarter and Full-Year 2011 Results and Increases Quarterly Dividend

HAMILTON, Bermuda--(BUSINESS WIRE)--Textainer Group Holdings Limited (NYSE:TGH), the world’s largest lessor of intermodal containers based on fleet size, today reported results for the fourth quarter and full year ended December 31, 2011. “Our fourth quarter closed out a record year for Textainer by every meaningful performance measure, including total revenues, profitability, utilization and fleet size,” said Philip K. Brewer, President and Chief Executive Officer of Textainer. “We also significantly increased our capital expenditures to $904 million, purchasing 448,000 TEU of containers positioning the Company for further success in 2012.”

“With 2011 as a backdrop, we expect that utilization may continue its slight decline during the first quarter of 2012, but that the overall level will remain attractive”

Key Financial Information (in thousands except for per share and TEU amounts):

    Q4 2011   Q4 2010   Full-year 2011   Full-year 2010
Total revenues   $ 116,377     $ 83,999     $ 422,796     $ 303,879  

Net income
attributable to
Textainer Group
Holdings Limited
common
shareholders

 

$

54,919

   

$

40,047

   

$

189,606

   

$

120,031

 

Net income
attributable to
Textainer Group
Holdings Limited
common
shareholders per
diluted common
share

 

 

 

$

 

 

1.10

   

 

 

$

 

 

0.81

   

 

 

$

 

 

3.80

   

 

 

$

 

 

2.43

 

Adjusted net
income(1)

 

$

53,008

   

$

35,701

   

$

178,199

   

$

123,451

 

Adjusted net
income per
diluted common
share(1)

 

 

 

$

 

 

1.06

   

 

 

$

 

 

0.72

   

 

 

$

 

 

3.58

   

 

 

$

 

 

2.50

 
EBITDA(1)   $ 89,213     $ 65,300     $ 332,212     $ 218,995  

Average fleet
utilization

   

97.7

%

   

98.0

%

   

98.3

%

   

95.4

%

Total fleet size at
end of period (TEU)

   

 

2,469,039

     

 

2,314,219

     

 

Owned
percentage of
total fleet at end
of period

   

 

 

58.6

 

 

%

   

 

 

50.9

 

 

%

 

 

“Adjusted net income” and “EBITDA” are Non-GAAP Measures that are reconciled to GAAP measures in footnote 1. “Adjusted net income” is defined as net income attributable to Textainer Group Holdings Limited common shareholders before unrealized losses on interest rate swaps, net, and gain on sale of containers to noncontrolling interest (“NCI”) and related impact of reconciling items on net income attributable to the NCI. “EBITDA” is defined as net income attributable to Textainer Group Holdings Limited common shareholders before interest income and interest expense, realized and unrealized losses on interest rate swaps and caps, net, income tax expense, net income attributable to the NCI, depreciation and amortization expense, and gain on sale of containers to NCI and related impact of reconciling items on net income attributable to the NCI. Footnote 1 provides certain qualifications and limitations on the use of Non-GAAP Measures.

All of Textainer’s financial results above were positively impacted by the following items in the fourth quarter 2011, compared to the year ago quarter:

  • 28.0% increase in the average size of the owned container fleet;
  • 1.7% increase in average per diem rental rates;
  • $2.3 million increase in net gain on container trading due to increased sales volume and average sales proceeds per container; and
  • An increase in estimated residual values, beginning July 1, 2011, used in the calculation of depreciation expense which resulted in $4.8 million less depreciation expense than would have been recorded using prior residual values.

These items were partially offset by increases in depreciation expense and interest expense due to the increase in the size of the owned container fleet and associated debt to fund this expansion.

All of Textainer’s financial results above were positively impacted by the following items for full-year 2011, compared to the prior year:

  • 29.5% increase in the average size of the owned container fleet;
  • 7.1% increase in average per diem rental rates;
  • 2.9 percentage point increase in utilization;
  • $2.5 million increase in net gain on container trading due to increased sales volume and average sales proceeds per container;
  • $7.2 million decrease in direct container expense primarily due to reduced storage expense;
  • An increase in estimated residual values, beginning July 1, 2011, used in the calculation of depreciation expense, which resulted in $9.5 million less depreciation expense than would have been recorded using prior residual values; and
  • A capital restructuring of our primary asset-owning subsidiary, Textainer Marine Containers Limited (“TMCL”), effective June 30, 2011, whereby our wholly-owned subsidiary, Textainer Limited, now owns 100% of TMCL, eliminating the related noncontrolling interest. The restructuring resulted in a $19.8 million gain on sale of containers to the prior noncontrolling interest holder. The gain was the result of recognizing the fair value of containers and direct financing and sales-type leases in excess of their book value exchanged for TMCL’s common shares at the time of the transaction. This was a noncash transaction.

These items were partially offset by increases in depreciation expense and interest expense due to the increase in the size of the owned container fleet and associated debt to fund this expansion.

TMCL’s issuance of $400 million in fixed rate asset backed notes in June represented one of the largest container securitizations in history and again demonstrated Textainer’s ability to attract strong investor support in the debt markets. With a debt-to-equity ratio of 2.2:1, the Company is in a strong position to continue purchasing both new and used containers to meet market demand and maintain our industry leading position.

Outlook

Capital expenditures for new standard dry-freight and refrigerated containers were the highest in the Company’s history and in-fleet container utilization continues to remain at or near historic highs. Demand for new standard dry-freight containers began to slow during the second quarter but demand for depot equipment remained strong. Utilization declined by approximately 1%, over the last half of the year. “With 2011 as a backdrop, we expect that utilization may continue its slight decline during the first quarter of 2012, but that the overall level will remain attractive,” commented Mr. Brewer. “We are optimistic that utilization may level off or start to improve during the second quarter of 2012 and with 78% of our fleet committed to long-term and direct financing and sales-type leases, we have a sizeable contracted revenue stream which we expect will continue to provide our shareholders with attractive returns. We are off to a good start in 2012, with 32,000 TEU of dry freight containers and 5,000 TEU of refrigerated containers already ordered. Furthermore, resale prices have recently declined in some locations but, relative to the last ten years, current resale price levels remain very high.”

Dividend

On February 10, 2012, Textainer’s board of directors approved and declared a quarterly cash dividend of $0.37 per share on Textainer’s issued and outstanding common shares, payable on March 6, 2012 to shareholders of record as of February 24, 2012. This dividend is an increase of $0.02 per share from the prior quarter, Textainer’s eighth consecutive quarterly increase, and will continue the Company’s history of paying constant or higher dividends every quarter since its October 2007 initial public offering. Combined, these dividends have averaged 43% of Adjusted net income(1) during this period. The current dividend represents 35% of Adjusted net income(1).

Investors’ Webcast

Textainer will hold a conference call and a Webcast with an accompanying slide presentation at 11:00 am EST on Tuesday, February 14, 2012 to discuss Textainer’s 2011 fourth-quarter and full-year results. An archive of the Webcast will be available one hour after the live call through February 14, 2013. For callers in the U.S. the dial-in number for the conference call is 877-303-9078; for callers outside the U.S. the dial-in number for the conference call is 970-315-0455. To access the live Webcast or archive, please visit Textainer’s website at http://www.textainer.com.

About Textainer Group Holdings Limited

Textainer Group Holdings Limited and its subsidiaries (“Textainer”) is the world's largest lessor of intermodal containers based on fleet size. The Company began operations in 1979 and as of the most recent quarter end had more than 1.6 million containers, representing more than 2.4 million TEU, in its owned and managed fleet. Textainer leases dry freight, refrigerated, and specialized containers. Each year the Company is one of the largest purchasers of new containers as well as one of the largest sellers of used containers. Textainer leases containers to approximately 400 shipping lines and other lessees and sells containers to more than 1,000 customers worldwide and provides services worldwide via a network of regional and area offices, as well as independent depots.

Important Cautionary Information Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of U.S. securities laws. Forward-looking statements include statements that are not statements of historical facts and include, without limitation, statements regarding: (i) Textainer’s belief that it is in a strong position to continue purchasing both new and used containers to meet market demand and maintain its industry leading position; (ii) Textainer’s expectation that utilization may continue its slight decline during the first quarter of 2012, but that the overall level will remain attractive and (iii) Textainer’s expectation that its sizeable contracted revenue stream will continue to provide its shareholders with attractive returns. Readers are cautioned that these forward-looking statements involve risks and uncertainties, are only predictions and may differ materially from actual future events or results. These risks and uncertainties include, without limitation, the following items that could materially and negatively impact our business, results of operations, cash flows, financial condition and future prospects: any deceleration or reversal of the current domestic and global economic recoveries; lease rates may decrease and lessees may default, which could decrease revenue and increasing storage, repositioning, collection and recovery expenses; we own a large and growing number of containers in our fleet and are subject to significant ownership risk; further consolidation of container manufacturers or the disruption of manufacturing for the major manufacturers could result in higher new container prices and/or decreased supply of new containers and any increase in the cost or reduction in the supply of new containers; the demand for leased containers depends on many political and economic factors beyond Textainer's control; the demand for leased containers is partially tied to international trade and if this demand were to decrease due to increased barriers to trade, or for any other reason, it could reduce demand for intermodal container leasing; as we increase the number of containers in our owned fleet, we will have significant capital at risk and may need to incur more debt, which could result in financial instability; Textainer faces extensive competition in the container leasing industry; the international nature of the container shipping industry exposes Textainer to numerous risks; gains and losses associated with the disposition of used equipment may fluctuate; our indebtedness reduces our financial flexibility and could impede our ability to operate; and other risks and uncertainties, including those set forth in Textainer's filings with the Securities and Exchange Commission. For a discussion of some of these risks and uncertainties, see Item 4 “Risk Factors” in Textainer’s Quarterly Report on Form 6-K and Item 3 "Key Information-- Risk Factors" in Textainer's Annual Report on Form 20-F filed with the Securities and Exchange Commission on November 14, 2011 and March 18, 2011, respectively.

Textainer's views, estimates, plans and outlook as described within this document may change subsequent to the release of this press release. Textainer is under no obligation to modify or update any or all of the statements it has made herein despite any subsequent changes Textainer may make in its views, estimates, plans or outlook for the future.

TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES
Condensed Consolidated Statements of Income
Three Months and Years Ended December 31, 2011 and 2010
(Unaudited)
(All currency expressed in United States dollars in thousands, except per share amounts)
           
Three Months Ended Years Ended
December 31, December 31,
  2011     2010     2011     2010  
 
Revenues:
Lease rental income $ 87,072 $ 68,237 $ 327,627 $ 235,827
Management fees 6,628 8,072 29,324 29,137
Trading container sales proceeds 14,770 1,445 34,214 11,291
Gains on sale of containers, net   7,907     6,245     31,631     27,624  
Total revenues   116,377     83,999     422,796     303,879  
Operating expenses (income):
Direct container expense 5,554 4,094 18,307 25,542
Cost of trading containers sold 12,219 1,146 29,456 9,046
Depreciation expense 21,501 18,050 83,177 58,972
Amortization expense 1,335 1,756 6,110 6,544
General and administrative expense 5,453 5,575 23,495 21,670
Short-term incentive compensation expense 1,209 1,342 4,921 4,805
Long-term incentive compensation expense 1,486 1,118 5,950 5,318
Bad debt expense, net 782 399 3,007 145
Gain on sale of containers to noncontrolling interest   -     -     (19,773 )   -  
Total operating expenses, net   49,539     33,480     154,650     132,042  
Income from operations   66,838     50,519     268,146     171,837  
Other income (expense):
Interest expense (14,649 ) (6,658 ) (44,891 ) (18,151 )
Interest income 12 13 32 27
Realized losses on interest rate swaps and caps, net (2,654 ) (2,445 ) (10,824 ) (9,844 )
Unrealized gains (losses) on interest rate swaps, net 1,909 5,495 (3,849 ) (4,021 )
Other, net   3     (762 )   (115 )   (1,591 )
Other expense, net   (15,379 )   (4,357 )   (59,647 )   (33,580 )
Income before income tax and noncontrolling interest 51,459 46,162 208,499 138,257
Income tax benefit (expense)   3,030     (1,274 )   (4,481 )   (4,493 )
Net income 54,489 44,888 204,018 133,764
Net loss (income) attributable to the noncontrolling interest   430     (4,841 )   (14,412 )   (13,733 )
Net income attributable to Textainer Group Holdings
Limited common shareholders $ 54,919   $ 40,047   $ 189,606   $ 120,031  
 

Net income attributable to Textainer Group Holdings Limited common

shareholders per share:

Basic $ 1.12 $ 0.83 $ 3.88 $ 2.50
Diluted $ 1.10 $ 0.81 $ 3.80 $ 2.43
 
Weighted average shares outstanding (in thousands):
Basic 48,931 48,255 48,859 48,108
Diluted 49,910 49,532 49,839 49,307
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
December 31, 2011 and December 31, 2010
(Unaudited)
(All currency expressed in United States dollars in thousands)
    2011       2010  

 

 

Assets
Current assets:
Cash and cash equivalents $ 74,816 $ 57,081

Accounts receivable, net of allowance for doubtful accounts of $7,840 and $8,653 in 2011 and 2010, respectively

86,428 63,511
Net investment in direct financing and sales-type leases 25,075 19,117
Trading containers 12,970 404
Containers held for sale 7,832 2,883
Prepaid expenses 10,243 8,603
Deferred taxes   2,443     1,895  

Total current assets

219,807 153,494
Restricted cash 45,858 15,034

Containers, net of accumulated depreciation of $377,731 and $361,791 at 2011 and 2010, respectively

1,903,855 1,437,259
Net investment in direct financing and sales-type leases 85,121 72,224

Fixed assets, net of accumulated depreciation of $9,027 and $8,820 at 2011 and 2010, respectively

1,717 1,804

Intangible assets, net of accumulated amortization of $33,340 and $27,441 at 2011 and 2010, respectively

46,675 60,122
Interest rate swaps - 1,320
Other assets   7,171     5,950  

Total assets

$ 2,310,204   $ 1,747,207  
Liabilities and Equity
Current liabilities:
Accounts payable $ 2,616 $ 6,296
Accrued expenses 18,491 11,988
Container contracts payable 25,510 98,731
Deferred revenue 6,245 6,855
Due to owners, net 15,812 17,545
Secured debt facility 41,035 -
Bonds payable   91,500     51,500  

Total current liabilities

201,209 192,915
Revolving credit facility 133,047 104,000
Secured debt facility 779,383 558,127
Bonds payable 464,226 175,570
Deferred revenue 1,136 2,994
Interest rate swaps 16,110 13,581
Income tax payable 22,729 20,821
Deferred taxes   7,438     8,632  

Total liabilities

  1,625,278  

Business Wire

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