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GATX Corporation Reports 2009 First Quarter Results
Dépèche transmise le 23 avril 2009 par Business Wire
GATX Corporation Reports 2009 First Quarter Results
CHICAGO--(BUSINESS WIRE)--GATX Corporation (NYSE:GMT) today reported 2009 first quarter net income of $27.6 million or $.56 per diluted share, compared to net income of $51.8 million or $1.03 per diluted share in the first quarter of 2008. The 2009 first quarter results include a negative after-tax fair-value adjustment of $11.6 million or $.23 per diluted share related to certain interest rate swaps at GATX’s AAE Cargo affiliate, and the 2008 first quarter results include a $6.8 million or $.13 per diluted share after-tax benefit from the reversal of tax reserves.
“We entered the year anticipating considerable challenges in our markets and operating conditions have been consistent with our expectations,” said Brian A. Kenney, president and chief executive officer of GATX. “In Rail, our customers are seeing decreased demand for their products and certain customers are operating under increasing financial stress. Consequently, there is pressure on fleet utilization and lease rates. Our North American fleet utilization was 96.5% at the end of the first quarter, down from 97.9% at year end and renewal lease rates on railcars in GATX’s Lease Price Index (LPI) declined 5.5%. Fortunately, the steps we took in recent years to position GATX for a downturn are helping us manage through these difficult market conditions.
“As expected, the environment in Marine is also challenging. In Specialty, charter rates at the marine joint ventures declined significantly in the fourth quarter of 2008, and while they have increased in some markets, they remain weak compared to recent years. American Steamship Company (ASC) recently commenced its sailing season, and it is clear that continued idling of steel manufacturing capacity on the Great Lakes will result in significantly lower iron ore shipments during the year.”
Mr. Kenney concluded, “Our 2009 full-year earnings estimate remains unchanged, excluding fair-value adjustments as noted above. There is increased downside variability to the estimate due to a variety of uncontrollable factors, which were noted in our 2008 year-end press release, including the price of scrap steel and other assets and increased financing costs that most companies face when accessing today’s capital markets. While the environment is volatile and difficult to predict, we remain focused on utilizing this uncertainty to strengthen our position in the market.”
RAIL
Rail segment profit was $43.1 million in the first quarter of 2009, including the negative $14.3 million pre-tax impact of the fair-value adjustment of interest rate swaps at GATX’s AAE Cargo affiliate. Asset remarketing income and scrap gains (included in “Other income”) at Rail were materially lower in the first quarter of 2009 versus the prior year.
At March 31, 2009, Rail’s North American fleet totaled approximately 112,000 cars. Fleet utilization declined to 96.5% from 97.9% at year end. The decline in utilization reflects both end-of-lease returns and the return of approximately 620 cars related to customer bankruptcies. Utilization and lease rate pressure is fairly broad based across car types, although it continues to be most acute in freight cars. The European wholly-owned tank car fleet totaled approximately 20,000 cars and utilization was 96.5% compared to 97.1% at year end.
Additional current and historical fleet and operating data as well as macroeconomic data related to Rail’s business can be found on the last page of this press release.
SPECIALTY
Specialty reported segment profit of $23.0 million in the first quarter of 2009 compared to $30.0 million in the prior year period. The year-over-year decline in segment profit was primarily due to lower share of affiliates’ earnings as the marine market remained soft following a sharp downturn in the fourth quarter of 2008.
The Specialty portfolio currently consists of approximately $641.3 million of owned assets (including on and off balance sheet assets) and third-party managed portfolios totaling approximately $274.1 million.
AMERICAN STEAMSHIP COMPANY
American Steamship Company (ASC) reported segment profit of $4.8 million in the first quarter 2009 compared to $.7 million in the first quarter 2008. ASC’s vessels are in winter lay up from January to late March. Steel mill capacity utilization and production are down dramatically from the prior year and ASC will deploy vessels accordingly. During the quarter, ASC reached a settlement in a litigation matter and as a result, recorded a $5.6 million recovery.
COMPANY DESCRIPTION
GATX Corporation (NYSE:GMT) provides leasing and related services to customers operating rail, marine and other targeted assets. GATX is a leader in leasing transportation assets and controls one of the largest railcar fleets in the world. Applying over a century of operating experience and strong market and asset expertise, GATX provides quality assets and services to customers worldwide. GATX has been headquartered in Chicago, Illinois since its founding in 1898 and has traded on the New York Stock Exchange since 1916. For more information, visit the Company’s website at www.gatx.com.
TELECONFERENCE INFORMATION
GATX Corporation will host a teleconference to discuss 2009 first quarter results. Teleconference details are as follows:
Thursday, April 23rd |
11:00 A.M.Eastern Time |
Domestic Dial-In: 1-877-852-6575 |
International Dial-In: 1-719-325-4758 |
Replay: 1-888-203-1112 / Access Code: 1951249 |
Call-in details, a copy of this press release and real-time audio access are available at www.gatx.com. Please access the call 15 minutes prior to the start time. Following the call, a replay will be available on the same site.
FORWARD-LOOKING STATEMENTS
This document contains statements that may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are subject to the safe harbor provisions of those sections and the Private Securities Litigation Reform Act of 1995. Some of these statements may be identified by words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “predict,” “project” or other words and terms of similar meaning. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, including those described in GATX’s Annual Report on Form 10-K and other filings with the SEC, and that actual results or developments may differ materially from those in the forward-looking statements. Specific factors that might cause actual results to differ from expectations include, but are not limited to, general economic, market, regulatory and political conditions in the rail, marine, industrial and other industries served by GATX and its customers; lease rates, utilization levels and operating costs in GATX’s primary asset segments; conditions in the capital markets; changes in GATX’s credit ratings and financing costs; regulatory rulings that may impact the economic value and operating costs of assets; competitive factors in GATX’s primary markets including lease pricing and asset availability; changes in loss provision levels within GATX’s portfolio; impaired asset charges that may result from changing market conditions or portfolio management decisions implemented by GATX; the opportunity for remarketing income; the outcome of pending or threatened litigation; and other factors. Given these risks and uncertainties, readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis, judgment, belief or expectation only as of the date hereof. GATX has based these forward-looking statements on information currently available and disclaims any intention or obligation to update or revise these forward-looking statements to reflect subsequent events or circumstances.
Investor, corporate, financial, historical financial, photographic and news release information may be found at www.gatx.com.
(04/23/09)
--Tabular Follows--
GATX CORPORATION AND SUBSIDIARIES |
|||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | |||
(In Millions, Except Per Share Data) | |||
Three Months Ended | |||
March 31 | |||
2009 | 2008 | ||
Gross Income | |||
Lease income | $ 232.8 | $ 234.8 | |
Marine operating revenue | 1.1 | 14.1 | |
Asset remarketing income | 14.4 | 20.9 | |
Other income | 14.6 | 19.4 | |
Revenues | 262.9 | 289.2 | |
Share of affiliates’ earnings | 1.5 | 21.9 | |
Total Gross Income | 264.4 | 311.1 | |
Ownership Costs | |||
Depreciation | 51.1 | 48.2 | |
Interest expense, net | 41.5 | 36.2 | |
Operating lease expense | 33.9 | 38.0 | |
Total Ownership Costs | 126.5 | 122.4 | |
Other Costs and Expenses | |||
Maintenance expense | 61.3 | 60.8 | |
Marine operating expense | 0.7 | 11.5 | |
Selling, general and administrative | 33.0 | 38.5 | |
Other | 3.4 | 11.2 | |
Total Other Costs and Expenses | 98.4 | 122.0 | |
Income before Income Taxes | 39.5 | 66.7 | |
Income Tax Provision | 11.9 | 14.9 | |
Net Income | $ 27.6 | $ 51.8 | |
GATX CORPORATION AND SUBSIDIARIES | |||
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) | |||
(In Millions, Except Per Share Data) | |||
(Continued) | |||
Three Months Ended | |||
March 31 | |||
2009 | 2008 | ||
Per Share Data | |||
Basic | $ 0.57 | $ 1.10 | |
Average number of common shares | 48.3 | 46.8 | |
Diluted | $ 0.56 | $ 1.03 | |
Average number of common shares and | |||
common share equivalents | 50.3 | 51.6 | |
Dividends declared per common share | $ 0.28 | $ 0.27 | |
GATX CORPORATION AND SUBSIDIARIES | |||||
CONSOLIDATED BALANCE SHEETS (UNAUDITED) | |||||
(In Millions) | |||||
March 31 | December 31 | ||||
2009 | 2008 | ||||
Assets | |||||
Cash and Cash Equivalents | $ 70.5 | $ 102.2 | |||
Restricted Cash | 40.6 | 41.1 | |||
Receivables | |||||
Rent and other receivables | 51.8 | 79.5 | |||
Finance leases | 325.1 | 331.8 | |||
Loans | 1.2 | 4.9 | |||
Less: allowance for possible losses | (18.9 | ) | (18.6 | ) | |
359.2 | 397.6 | ||||
Operating Lease Assets, Facilities and Other | |||||
Rail | 5,202.3 | 5,232.3 | |||
Specialty | 260.6 | 271.4 | |||
ASC | 376.3 | 373.1 | |||
Less: allowance for depreciation | (1,948.3 | ) | (1,955.2 | ) | |
3,890.9 | 3,921.6 | ||||
Investments in Affiliated Companies | 388.9 | 399.3 | |||
Goodwill | 92.0 | 95.7 | |||
Other Assets | 207.7 | 232.9 | |||
Total Assets | $ 5,049.8 | $ 5,190.4 | |||
Liabilities and Shareholders’ Equity | |||||
Accounts Payable and Accrued Expenses | $ 126.5 | $ 146.6 | |||
Debt | |||||
Commercial paper and borrowings under bank credit facilities | 136.5 | 125.1 | |||
Recourse | 2,363.1 | 2,376.2 | |||
Nonrecourse | 240.5 | 243.3 | |||
Capital lease obligations | 60.8 | 64.7 | |||
2,800.9 | 2,809.3 | ||||
Deferred Income Taxes | 714.0 | 710.9 | |||
Other Liabilities | 338.7 | 399.1 | |||
Total Liabilities | 3,980.1 | 4,065.9 | |||
Total Shareholders’ Equity | 1,069.7 | 1,124.5 | |||
Total Liabilities and Shareholders’ Equity | $ 5,049.8 | $ 5,190.4 | |||
GATX CORPORATION AND SUBSIDIARIES | ||||||||||||
SEGMENT DATA (UNAUDITED) | ||||||||||||
Three Months Ended March 31, 2009 | ||||||||||||
(In Millions) | ||||||||||||
GATX | ||||||||||||
Rail | Specialty | ASC | Other | Consolidated | ||||||||
Gross Income | ||||||||||||
Lease income | $ 216.5 | $ 15.3 | $ 1.0 | $ - | $ 232.8 | |||||||
Marine operating revenue | - | - | 1.1 | - | 1.1 | |||||||
Asset remarketing income | 4.7 | 9.7 | - | - | 14.4 | |||||||
Other income | 13.2 | 1.1 | 0.1 | 0.2 | 14.6 | |||||||
Revenues | 234.4 | 26.1 | 2.2 | 0.2 | 262.9 | |||||||
Share of affiliates’ earnings | (8.9 | ) | 10.4 | - | - | 1.5 | ||||||
Total Gross Income | 225.5 | 36.5 | 2.2 | 0.2 | 264.4 | |||||||
Ownership Costs | ||||||||||||
Depreciation | 46.2 | 4.9 | - | - | 51.1 | |||||||
Interest expense, net | 33.6 | 5.8 | 2.2 | (0.1 | ) | 41.5 | ||||||
Operating lease expense | 33.6 | 0.4 | - | (0.1 | ) | 33.9 | ||||||
Total Ownership Costs | 113.4 | 11.1 | 2.2 | (0.2 | ) | 126.5 | ||||||
Other Costs and Expenses | ||||||||||||
Maintenance expense | 61.2 | - | 0.1 | - | 61.3 | |||||||
Marine operating expense | - | - | 0.7 | - | 0.7 | |||||||
Other | 7.8 | 2.4 | (5.6 | ) | (1.2 | ) | 3.4 | |||||
Total Other Costs and Expenses | 69.0 | 2.4 | (4.8 | ) | (1.2 | ) | 65.4 | |||||
Segment Profit | $ 43.1 | $ 23.0 | $ 4.8 | $ 1.6 | 72.5 | |||||||
Selling, general and administrative | 33.0 | |||||||||||
Income before Income Taxes | 39.5 | |||||||||||
Income Tax Provision | 11.9 | |||||||||||
Net Income | $ 27.6 | |||||||||||
Selected Data: |
||||||||||||
Investment Volume | $ 70.5 | $ 4.2 | $ 3.2 | $ 1.4 | $ 79.3 | |||||||
Asset Remarketing Income: | ||||||||||||
Disposition Gains on Owned Assets | 0.7 | 1.4 | - | - | 2.1 | |||||||
Residual Sharing Income | 4.0 | 8.3 | - | - | 12.3 | |||||||
Total Asset Remarketing Income | $ 4.7 | $ 9.7 | $ - | $ - | $ 14.4 | |||||||
Scrapping Gains (a) | $ 2.2 | $ - | $ - | $ - | $ 2.2 |
(a) Included in Other income
GATX CORPORATION AND SUBSIDIARIES | ||||||||||
SEGMENT DATA (UNAUDITED) | ||||||||||
Three Months Ended March 31, 2008 | ||||||||||
(In Millions) | ||||||||||
GATX | ||||||||||
Rail | Specialty | ASC | Other | Consolidated | ||||||
Gross Income | ||||||||||
Lease income | $ 219.5 | $ 14.2 | $ 1.1 | $ - | $ 234.8 | |||||
Marine operating revenue | - | - | 14.1 | - | 14.1 | |||||
Asset remarketing income | 11.0 | 9.9 | - | - | 20.9 | |||||
Other income | 17.5 | 1.7 | - | 0.2 | 19.4 | |||||
Revenues | 248.0 | 25.8 | 15.2 | 0.2 | 289.2 | |||||
Share of affiliates’ earnings | 5.5 | 16.4 | - | - | 21.9 | |||||
Total Gross Income | 253.5 | 42.2 | 15.2 | 0.2 | 311.1 | |||||
Ownership Costs | ||||||||||
Depreciation | 44.2 | 4.0 | - | - | 48.2 | |||||
Interest expense, net | 30.1 | 4.1 | 2.4 | (0.4 | ) | 36.2 | ||||
Operating lease expense | 37.6 | 0.5 | - | (0.1 | ) | 38.0 | ||||
Total Ownership Costs | 111.9 | 8.6 | 2.4 | (0.5 | ) | 122.4 | ||||
Other Costs and Expenses | ||||||||||
Maintenance expense | 60.2 | - | 0.6 | - | 60.8 | |||||
Marine operating expense | - | - | 11.5 | - | 11.5 | |||||
Other | 7.6 | 3.6 | - | - | 11.2 | |||||
Total Other Costs and Expenses | 67.8 | 3.6 | 12.1 | - | 83.5 | |||||
Segment Profit | $ 73.8 | $ 30.0 | $ 0.7 | $ 0.7 | 105.2 | |||||
Selling, general and administrative | 38.5 | |||||||||
Income before Income Taxes | 66.7 | |||||||||
Income Tax Provision | 14.9 | |||||||||
Net Income | $ 51.8 | |||||||||
Selected Data: |
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