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Rail News: Financials

Trinity Industries' third-quarter revenue rises, but material costs 'impede' income recovery

Yesterday, Trinity Industries Inc. reported third-quarter revenue of $567.2 million, a 56 percent increase compared with third-quarter 2003.

During the quarter, the company's North American rail-car backlog increased to about 19,800 units — Trinity's largest backlog since March 1999.

However, the company's quarterly net income fell 50 percent to $900,000 and operating profit dropped 63 percent to $3.8 million compared with last year. Trinity reported $19.5 million in pre-tax charges for steel and related material cost increases.

"Our volume of business has definitely improved, [but] unfortunately steel cost increases continue to impede our recovery," said Trinity Chairman, President and Chief Executive Officer Timothy Wallace in a prepared statement. "Fortunately, our current sales orders are priced with current steel costs and, if necessary, they contain contract language providing for price escalation. Over the next six to nine months, our new sales orders with updated pricing will substantially replace the fixed-price agreements in our current backlog."

For 2004's first nine months, Trinity reported a net loss of $6.3 million on revenue totaling $1.6 billion compared with a net loss of $9.2 million on revenue totaling $1 billion during the same 2003 period. The company also reported pre-tax charges of $37.5 million for steel and related material cost increases, and $1.9 million in additional costs related to reopening two idle rail-car plants to meet increasing demand.

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More News from 11/3/2004