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Rail News: Financials

Financials: Trinity registers quarterly, yearly net losses despite revenue gains

The cost of steel and other raw materials took a bite out of Trinity Industries Inc.'s fourth-quarter earnings. Yesterday, the rail-car builder reported a quarterly net loss of $3 million on revenue totaling $627 million compared with a net loss of $800,000 on revenue totaling $415 million in fourth-quarter 2003. Operating profit fell more than 40 percent to $2.5 million.

"Steel and material cost increases negatively impacted pre-tax earnings in the fourth quarter by an estimated $17 million," said Trinity Chairman, President and Chief Executive Officer Timothy Wallace in a prepared statement, adding that the material cost increases will continue to affect earnings through the first quarter.

Trinity's year-end backlog of rail-car orders reached its highest level since 1998. The company's North American car deliveries rose 72 percent in the fourth quarter and 82 percent during 2004 compared with similar 2003 periods.

"I’m pleased we are mitigating the [raw-material price] impacts through price escalation clauses and other arrangements tied to an increasing percentage of our rail-car and barge backlogs," said Wallace.

For 2004, Trinity reported a net loss of $9.3 million on revenues totaling $2.2 billion compared with a net loss of $10 million on revenue totaling $1.4 billion in 2003. Operating profit increased 5.2 percent to $14.1 million.

"Revenue grew in every segment of our business during 2004," said Wallace, adding that the company expects similar revenue growth in 2005.

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More News from 3/3/2005