Press Releases

Greenbrier Doubles Third Quarter Earnings to $.42 Per Share on Revenues of $225 Million; Backlog at Record Levels
PRNewswire-FirstCall
LAKE OSWEGO, Ore.
   Highlights

   *    Net earnings for the third quarter were $6.4 million, or $.42 per
        diluted share, equal to net earnings for the entire first half of
        fiscal 2004.  Third quarter earnings are double the net earnings of
        $3.0 million, or $.21 per diluted share, for the third quarter of
        fiscal 2003.
   *    Revenues for the third quarter grew to $225 million, up 63% from
        $138 million in the prior year's third quarter, and up 35% from $167
        million in the second quarter of fiscal 2004.
   *    New railcar deliveries for the quarter were 3,600 units, up 125%
        from 1,600 units for the third quarter of fiscal 2003.  Year to date
        deliveries were 7,800 units compared to 4,400 in the prior fiscal
        year.  Current quarter deliveries include 600 units produced in a
        prior period for which revenue recognition was deferred until the
        current quarter.
   *    New railcar manufacturing backlog in North America and Europe was at
        a month-end record 14,300 units valued at $840 million at June 30,
        2004 compared to 9,700 units valued at $600 million at May 31, 2004,
        and to 10,000 units valued at $560 million at February 29, 2004.

                            Financial Results:

The Greenbrier Companies today reported net earnings of $6.4 million, or $.42 per diluted share, on revenues of $225 million for its third fiscal quarter ended May 31, 2004.

William A. Furman, president and chief executive officer, said, "All lines of business realized improved performance and contributed to the strong quarterly results. The economic recovery and growth in railroad freight loadings have helped fuel our profitability. However, initiatives instituted earlier in the year are also paying off. As an example, a team was put in place to aggressively manage steel and scrap surcharge issues with customers and suppliers. The increase in manufacturing margins and pricing on recent orders in backlog reflects the successes realized in this area."

Furman added, "Greenbrier's new railcar backlog is at record levels, with car types which will help assure long, efficient production runs. The Company's market share of total North American new railcar industry backlog was 25% at June 30, 2004, while our share of industry capacity is only about 15%. This strong backlog provides good financial visibility through most of fiscal 2005. Our leasing operations continue to realize margin enhancement, as a result of lease extensions at higher lease rates and higher lease fleet utilization."

Cash Flow, Liquidity, Deliveries:

Mark Rittenbaum, senior vice president and treasurer, said, "EBITDA for the quarter was $19 million, and year to date was $42 million. Unused lines of credit remain at nearly $100 million, with over $40 million of debt and participation paid down year to date. We now anticipate Greenbrier's new railcar deliveries will exceed 10,500 units for the fiscal year, surpassing our earlier estimates of 10,000 units."

The Greenbrier Companies (www.gbrx.com), 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 produces rail castings through an unconsolidated joint venture and also manufactures new freight cars through the use of unaffiliated subcontractors. 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 approximately 11,000 railcars and performs management services for approximately 122,000 railcars.

"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This release may contain forward-looking statements. Greenbrier uses words such as "anticipate," "believe," "plan," "expect," "future," "intend" and similar expressions to identify forward-looking statements. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, actual future costs and the availability of materials and a trained workforce; steel price increases and scrap surcharges; changes in product mix and the mix between manufacturing and leasing & services segment; labor disputes, energy shortages or operating difficulties that might disrupt manufacturing operations or the flow of cargo; production difficulties and product delivery delays as a result of, among other matters, changing technologies or non-performance of subcontractors or suppliers; ability to obtain suitable contracts for the sale of leased equipment; all as may be discussed in more detail under the heading "Forward Looking Statements" on pages 3 through 4 of Part I of our Annual Report on Form 10-K for the fiscal year ended August 31, 2003. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date hereof. We undertake no obligation to revise or publicly release the results of any revision to these forward- looking statements.

The Greenbrier Companies will host a teleconference to discuss third quarter fiscal 2004 results. Teleconference details are as follows:

        Wednesday, July 14, 2004
        8:00 am 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)

                                                  May 31,      August 31,
                                                    2004          2003
  Assets
   Cash and cash equivalents                       $13,793        $77,298
   Restricted cash                                   1,826          5,434
   Accounts and notes receivable                   111,762         80,197
   Inventories                                      91,667        105,652
   Investment in direct finance leases              24,628         41,821
   Equipment on operating leases                   163,340        139,341
   Property, plant and equipment                    55,095         58,385
   Other                                            23,916         30,820

                                                  $486,027       $538,948

  Liabilities and Stockholders' Equity
   Revolving notes                                 $24,362        $21,317
   Accounts payable and accrued liabilities        153,818        150,874
   Participation                                    36,731         55,901
   Deferred revenue                                  2,233         39,779
   Deferred income taxes                            18,058         16,127
   Notes payable                                   102,429        117,989

   Subordinated debt                                15,966         20,921

   Subsidiary shares subject to mandatory
    redemption                                       3,746          4,898

   Stockholders' equity                            128,684        111,142

                                                  $486,027       $538,948


                                           THE GREENBRIER COMPANIES, INC.

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


                           Three Months Ended        Nine Months Ended
                         May 31,      May 31,       May 31,      May 31,
                          2004         2003          2004         2003
  Revenue
   Manufacturing        $207,136     $121,259     $473,164     $342,759
   Leasing & services     18,157       16,853       53,888       52,722
                         225,293      138,112      527,052      395,481

  Cost of revenue
   Manufacturing         189,275      109,247      432,857      318,518
   Leasing & services     10,301       10,265       31,542       32,791
                         199,576      119,512      464,399      351,309

  Margin                  25,717       18,600       62,653       44,172

  Other costs
   Selling and
    administrative        12,352       10,102       33,336       29,110
   Interest and foreign
    exchange               2,932        2,707        8,136       10,399
  Special charges             --           --        1,234           --
                          15,284       12,809       42,706       39,509

  Earnings before income
   taxes and equity in
   unconsolidated
   subsidiaries           10,433        5,791       19,947        4,663

  Income tax expense     (4,116)      (2,324)      (5,446)      (2,222)
  Earnings before equity
   in unconsolidated
   subsidiaries            6,317        3,467       14,501        2,441

  Equity in earnings
   (loss) of
   unconsolidated
   subsidiaries               58        (461)      (1,734)      (1,416)

  Net earnings            $6,375       $3,006      $12,767       $1,025

  Basic earnings per
   common share            $0.44        $0.21        $0.88        $0.07

  Diluted earnings per
   common share            $0.42        $0.21        $0.84        $0.07

  Weighted average common shares:
   Basic                  14,628       14,121       14,500       14,121
   Diluted                15,224       14,332       15,111       14,261


                                           THE GREENBRIER COMPANIES, INC.

   Condensed Consolidated Statements of Cash Flows
   (In thousands, unaudited)


                                                      Nine Months Ended
                                                   May 31,        May 31,
                                                    2004           2003
  Cash flows from operating activities
   Net earnings                                    $12,767         $1,025
   Adjustments to reconcile net earnings to net
    cash provided by (used in) operating activities:
    Deferred income taxes                            1,931          1,088
    Depreciation and amortization                   15,529         13,779
    Gain on sales of equipment                       (236)          (336)
    Special charges                                  1,234             --
    Other                                            1,669          (928)
    Decrease (increase) in assets:
     Accounts and notes receivable                (27,815)       (15,463)
     Inventories                                     9,714        (3,430)
     Other                                           1,028        (3,721)
    Increase (decrease) in liabilities:
     Accounts payable and accrued liabilities        9,300         30,397
     Participation                                (19,170)        (5,622)
     Deferred revenue                             (37,292)        (3,249)
   Net cash (used in) provided by operating
    activities                                    (31,341)         13,540

  Cash flows from investing activities
   Principal payments received under direct
    finance leases                                   7,348         11,290
   Proceeds from sales of equipment                 10,719         22,093
   Purchase of property and equipment             (33,277)        (8,532)
   Decrease (increase) in restricted cash            3,608        (1,103)
   Investment in and advances to unconsolidated
    joint venture                                  (4,755)             --
   Net cash (used in) provided by investing
    activities                                    (16,357)         23,748

  Cash flows from financing activities
   Changes in revolving notes                        3,045          (862)
   Repayments of notes payable                    (16,504)       (20,270)
   Repayment of subordinated debt                  (4,955)        (5,537)
   Exercise of stock options                         3,884             --
   Purchase of subsidiary shares subject to
    mandatory redemption                           (1,277)             --
   Net cash used in financing activities          (15,807)       (26,669)

  Increase (decrease) in cash and cash
   equivalents                                    (63,505)         10,619

  Cash and cash equivalents
   Beginning of period                              77,298         67,596

   End of period                                   $13,793        $78,215


                                           THE GREENBRIER COMPANIES, INC.

   Supplemental Disclosure
   Reconciliation of Net Cash Provided by Operating Activities to EBITDA
  (In thousands, unaudited)


                          Three Months Ended         Nine Months Ended
                        May 31,       May 31,      May 31,      May 31,
                          2004          2003         2004         2003
  Net cash (used in)
   provided by operating
   activities            $35,458      $12,724   $ (31,341)      $13,540
  Changes in working
   capital              (19,073)      (5,171)       64,235        1,088
  Deferred income taxes  (3,554)         (52)      (1,931)      (1,088)
  Gain on sales of
   equipment                  46            3          236          336
  Special charges             --           --      (1,234)           --
  Other                  (1,300)          169      (1,669)          928
  Income tax expense       4,116        2,324        5,446        2,222
  Interest and foreign
   exchange                2,932        2,707        8,136       10,399

  EBITDA(1)              $18,625      $12,704     $ 41,878      $27,425

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

SOURCE: The Greenbrier Companies

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