Press Releases

Greenbrier Announces Improved Second Quarter Results and Backlog; Forecasts Return to Profitability in Second Half of the Fiscal Year and for the Year As A Whole
Highlights -- Enhanced performance in North America and Europe improved bottom line results from the same period last year. Loss from continuing operations of $.8 million, or $.05 per share, was realized for the second quarter of fiscal 2003. This compares to a loss from continuing operations of $3.2 million, or $.22 per share, in the second quarter of fiscal 2002. -- Second quarter fiscal 2003 results included costs of $3.2 million pre-tax associated with certain temporary manufacturing inefficiencies and supplier related issues in North America. -- Management forecasts a return to profitability in the second half of the fiscal year and the year as a whole, as the result of higher production rates, improved margins, and operating efficiencies. -- New orders for 1,500 freight cars, with a value of $90 million, were received during the second quarter. -- New railcar manufacturing backlog in North America and Europe rose to 5,800 units valued at $330 million at February 28, 2003, compared to 5,700 units valued at $310 million at November 30, 2002. -- The Company continues to maintain strong liquidity. After debt paydowns of $17 million in the first half of the year, February 28, 2003 cash balances were virtually unchanged from August 31, 2002 at nearly $60 million; unused lines of credit remained at $110 million in North America.
PRNewswire-FirstCall
LAKE OSWEGO, Ore.

The Greenbrier Companies today reported improved results for its second fiscal quarter ended February 28, 2003. Both North American and European operations showed significant financial improvement against the prior year's second fiscal quarter. New railcar backlog and production rates have doubled during this same period. The Company anticipates a return to profitability for the second half of the fiscal year and for the year as a whole.

Results for continuing operations in North America were a loss of $0.8 million for the second quarter of fiscal year 2003, compared to a loss of $3.2 million in the second quarter of 2002 and nearly break even results for the first quarter of 2003. Loss from discontinued European operations was $.5 million for the quarter, compared to a loss of $13.7 million in the second quarter of 2002 and a loss of $.6 million in the first quarter of 2003. The prior year's second quarter results include a special charge to continuing North American operations of $2.1 million pretax, and a $17.1 million pretax special charge to discontinued operations.

Net loss for the quarter was $1.2 million, or $.09 per share, compared to a net loss of $16.8 million, or $1.19 per share, in the second quarter of fiscal 2002.

Backlog remained strong and stable during the quarter in both North America and Europe. The February 28, 2003 backlog includes 4,500 units valued at $230 million from North American operations and 1,300 units valued at $100 million from European operations. The November 30, 2002 backlog also included 4,500 units valued at $230 million in North America and 1,200 units valued at $80 million in Europe. During the quarter, the Company received orders for 1,500 new railcars valued at $90 million.

William A. Furman, president and chief executive officer, said, "Greenbrier's business outlook in new freight cars continues to improve. Orders for over 3,200 railcars have been received during the first six months of the fiscal year, pushing new railcar production and related financial visibility into our next fiscal year. We expect the Company to be profitable for the second half of the year and the year as a whole, due to higher production levels and improved margins at all of our new railcar facilities. The available supply of rail castings to meet scheduled production continues to be a critical item. We intend to press forward to protect our own interests and to seek a solution for the industry's difficulties."

"In Mexico, Gunderson-Concarril has been re-opened, and we have commenced production of boxcars for TTX Company. Starting in May, our Gunderson facility will exclusively build double-stack intermodal cars, where the market outlook is strong. Recent orders for over 1,300 riserless deck center partition cars provide a solid outlook for our TrentonWorks facility in Canada. Greenbrier's marine business also received a new order during the second quarter for a 100,000 barrel ocean-going oil barge, pushing its backlog into mid-2004."

Furman added, "We continue to make great progress in our European operations, as a result of aggressive cost reduction measures taken in 2002 and a rebound in the market. Greenbrier remains committed to its plan to recapitalize European operations by the end of fiscal 2003."

Mark Rittenbaum, senior vice president and treasurer, noted, "During each of the first two fiscal quarters of 2003, the Company delivered 1,200 new railcars in North America, compared to only 700 cars in the second quarter of 2002. Deliveries in the second half of fiscal 2003 are anticipated to exceed 3,500 units, as we operate at higher production levels."

"The company's second quarter was impacted by temporary production inefficiencies at TrentonWorks due to the delay in drop deck center partition car production while patent litigation is being resolved. As a result of recent new orders at TrentonWorks, production of riserless deck cars has been accelerated to offset the delay, and TrentonWorks is operating at efficient levels of production again. Gunderson also experienced certain supplier related issues which are now resolved."

Rittenbaum added, "Greenbrier continues to maintain strong liquidity, with cash balances unchanged over the past six months at nearly $60 million, pay downs of debt of $17 million, and unused lines of credit of nearly $110 million. EBITDA from continuing operations was $14.3 million for the first six months of fiscal 2003, compared to $11.2 million for the first six months of fiscal 2002."

The Greenbrier Companies, headquartered in Lake Oswego, Oregon, is a leading supplier of transportation equipment and services to the railroad industry in North America. Greenbrier builds new railroad freight cars in the U.S., Canada and Mexico, and repairs and refurbishes freight cars and wheels at thirteen locations across North America. The Company also builds new railroad freight cars and refurbishes freight cars for the European market through its manufacturing operations in Poland and various sub-contractor facilities throughout Europe. At Greenbrier's Portland, Oregon manufacturing facility, it builds ocean-going barges for the maritime industry. Greenbrier owns or manages a fleet of approximately 49,000 railcars.

Except for historical information contained herein, this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation, statements as to expectations, beliefs, and future financial performance. These forward-looking statements are dependent on a number of factors, business risks and issues, a change in which could cause actual results to differ materially from those expressed or implied in the forward-looking statements. Such factors, risks and issues are set forth from time to time under "Forward-Looking Statements," in Management's Discussion and Analysis of Financial Condition and Results of Operations in Greenbrier's SEC filings and reports. Any forward-looking statement speaks only as of the date on which such statement is made. Greenbrier undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made.

The Greenbrier Companies will host a teleconference to discuss second quarter results. Teleconference details are as follows:

    Wednesday, April 9, 2003
    8:00 a.m. Pacific Daylight Time
    Real-time Audio Access:  ("Newsroom" at http://www.gbrx.com/ )

Please access the site 10 minutes prior to the start time. Following the call, a replay will be available on the same site.

   THE GREENBRIER COMPANIES, INC.
   Condensed Consolidated Balance Sheets
   (In thousands, unaudited)

                                                 February 28,    August 31,
                                                     2003           2002

  Assets
    Cash and cash equivalents                      $59,240        $58,777
    Accounts and notes receivable                   40,916         45,135
    Inventories                                     69,949         56,868
    Investment in direct finance leases             52,855         69,536
    Equipment on operating leases                  143,575        151,580
    Property, plant and equipment                   57,091         58,292
    Other                                           19,959         21,507
    Discontinued operations                         45,416         65,751
                                                  $489,001       $527,446

  Liabilities and Stockholders' Equity
    Revolving notes                                 $5,511         $3,571
    Accounts payable and accrued liabilities       117,493        108,244
    Deferred participation                          43,963         52,937
    Deferred income taxes                           14,859         13,823
    Notes payable                                  122,046        136,577
    Discontinued operations                         56,672         77,188

    Subordinated debt                               23,131         27,069
    Minority interest                                4,898          4,898
    Stockholders' equity                           100,428        103,139
                                                  $489,001       $527,446


   Consolidated Statements of Operations
   (In thousands, except per share amounts, unaudited)

                           Three Months Ended          Six Months Ended
                              February 28,               February 28,
                            2003         2002         2003          2002
  Revenue
    Manufacturing        $86,539       $53,552     $165,749      $106,769
    Leasing & services    18,190        18,270       35,869        36,509
                         104,729        71,822      201,618       143,278

  Cost of revenue
    Manufacturing         83,173        52,899      157,508       102,591
    Leasing & services    10,961        10,632        22,52       720,863
                          94,134        63,531      180,035       123,454

  Margin                  10,595         8,291       21,583        19,824

  Other costs
    Selling and
     administrative
     expense               8,162         7,132       15,232        14,623
    Interest expense       2,992         3,915        6,273         8,163
    Special charges           --         2,083           --         2,083
                          11,154        13,130       21,505        24,869
  Earnings (loss) before
   income taxes, minority
   interest and equity
   in unconsolidated
   subsidiary              (559)       (4,839)           78       (5,045)

  Income tax benefit
   (expense)                 213         1,911         (16)         1,996
  Earnings (loss) before
   minority interest and
   equity in unconsolidated
   subsidiary              (346)       (2,928)           62       (3,049)

  Minority interest           18           171           --            --
  Equity in unconsolidated
   subsidiary              (437)         (416)        (955)         (925)

  Loss from continuing
   operations              (765)       (3,173)        (893)       (3,974)

  Loss from discontinued
   operations
   (net of tax)            (472)      (13,653)      (1,088)      (17,895)

  Net loss              $(1,237)     $(16,826)     $(1,981)     $(21,869)

  Basic loss per
   common share
    Continuing
     operations          $(0.05)       $(0.22)      $(0.06)       $(0.28)
    Discontinued
     operations           (0.04)        (0.97)       (0.08)        (1.27)
    Net loss             $(0.09)       $(1.19)      $(0.14)       $(1.55)

  Diluted loss per
   common share
    Continuing
     operations          $(0.05)       $(0.22)      $(0.06)       $(0.28)
    Discontinued
     operations           (0.04)        (0.97)       (0.08)        (1.27)
    Net loss             $(0.09)       $(1.19)      $(0.14)       $(1.55)

  Weighted average
   common shares:
    Basic                 14,121        14,121       14,121        14,121
    Diluted               14,121        14,121       14,121        14,121


   Consolidated Statements of Cash Flows
   (In thousands, unaudited)

                                                     Six Months Ended
                                                       February 28,
                                                    2003           2002

  Cash flows from operating activities
    Net loss                                      $(1,981)      $(21,869)
    Adjustments to reconcile net loss to
     net cash used in operating activities:
      Loss from discontinued operations              1,088         17,895
      Other changes in discontinued operations     (1,269)          (159)
      Deferred income taxes                          1,036        (5,051)
      Deferred participation                       (8,974)        (1,936)
      Depreciation and amortization                  8,895          9,044
      Gain on sales of equipment                     (333)          (507)
      Other                                          (836)           (19)
      Decrease (increase) in assets:
        Accounts and notes receivable                4,219            699
        Inventories                               (15,968)            157
        Other                                        1,424          1,324
      Increase (decrease) in liabilities:
        Accounts payable and accrued liabilities     9,603        (4,639)
    Net cash used in operating activities          (3,096)        (5,061)

  Cash flows from investing activities
    Principal payments received
     under direct finance leases                     7,801         10,175
    Proceeds from sales of equipment                17,492         14,785
    Purchase of property and equipment             (4,928)       (10,312)
    Investment in discontinued operations               --        (1,200)
    Net cash provided by investing activities       20,365         13,448

  Cash flows from financing activities
    Changes in revolving notes                       1,940        (7,856)
    Repayments of notes payable                   (14,808)       (20,663)
    Repayment of subordinated debt                 (3,938)        (8,230)
    Dividends                                           --          (847)
    Net cash used in financing activities         (16,806)       (37,596)

  Increase (decrease) in cash and cash equivalents     463       (29,209)

  Cash and cash equivalents
    Beginning of period                             58,777         74,547
    End of period                                  $59,240        $45,338


   Supplemental Disclosure
   Reconciliation of GAAP to EBITDA (A)
   (In thousands, unaudited)

                                                       Six Months Ended
                                                         February 28,
                                                     2003          2002

  Reported GAAP loss from continuing operations     $(893)       $(3,974)
  Income tax (benefit) / expense                        16        (1,966)
  Interest expense                                   6,273          8,163
  Depreciation and amortization                      8,895          9,044
  EBITDA from continuing operations                $14,291        $11,267


  (A) "EBITDA" (earnings from continuing operations before interest, taxes,
      depreciation and amortization) is a measurement commonly used by the
      rail supply companies.  It should not be considered in isolation or as
      a substitute for cash flow from operation activities or cash flow
      statement data prepared in accordance with generally accepted
      accounting principles.


   Summarized results of operations of the discontinued operations are:

   (In thousands)          Three Months Ended           Six Months Ended
                              February 28,                February 28,
                           2003          2002          2003        2002

  Revenue (A)            $13,851       $27,246      $55,751       $35,673
  Cost of revenue (A)     12,265        26,980       51,762        35,572
  Margin                   1,586           266        3,989           101
  Selling and
   administrative expense  1,391         2,187        3,776         5,068
  Interest expense           766           768        1,419         2,007
  Special charges (B)         --        17,129           --        17,129
  Loss before income taxes
   and minority interest   (571)      (19,818)      (1,206)      (24,103)
  Income tax benefit          99         6,111          118         6,111
  Minority interest           --            54           --            97
  Loss from discontinued
   operations             $(472)     $(13,653)     $(1,088)     $(17,895)


The following assets and liabilities of the European operation are classified as discontinued operations:

  (In thousands)                                 February 28,    August 31,
                                                     2003           2002

  Cash and cash equivalents                         $8,695         $8,953
  Accounts receivable                               15,750          9,645
  Inventories (A)                                   12,128         39,304
  Property, plant and equipment                      1,540          1,072
  Other                                              7,303          6,777
      Total assets - discontinued operations       $45,416        $65,751

  Revolving notes                                  $19,480        $22,249
  Accounts payable and accrued liabilities (A)      29,721         47,385
  Notes payable                                      7,471          7,554
        Total liabilities - discontinued
         operations                                $56,672        $77,188

  Discontinued operations -liabilities              47,472         67,988
  Estimated liabilities associated with
   discontinued operations ©                       9,200          9,200
        Total                                      $56,672        $77,188


  (A) August 31, 2002 balances include $26.9 million in inventory and
      associated deferred revenue for railcars delivered to a customer for
      which cash was received but revenue recognition delayed pending
      certification of railcars.  Certification was obtained in the first
      quarter of 2003 and remaining railcars were delivered allowing
      recognition of revenue of  $27.7 million and the associated cost of
      revenue.
  (B) Special charges relate to $14.8 million of asset impairment write-
      downs and $2.3 million in costs associated with a restructuring plan
      to reduce the scale of European operations.
  © Estimated liabilities associated with discontinued operations
      represent obligations of the European operations.  The settlement of
      these obligations will depend in part upon the results of
      negotiations.  The aggregate amount of the obligations has been
      estimated pending determination of the final form of the resolution.

SOURCE: The Greenbrier Companies

CONTACT: Mark Rittenbaum of Greenbrier Companies, +1-503-684-7000