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Rail News: Financials

Greenbrier's earnings, rail-car deliveries and backlog fall in first fiscal quarter


During its first fiscal quarter in FY2007, The Greenbrier Cos. delivered 2,000 rail cars compared with 2,400 units in first-quarter FY2006. Deliveries dropped in the period, which ended Nov. 30, because of line changeovers, lower production rates and suspended production at the car builder’s Trenton, Nova Scotia, plant.

And car deliveries likely will continue to decrease during the remainder of the fiscal year, Greenbrier said.

“Events in the first quarter, coupled with operating in a less certain economic environment, have made us more cautious. This is particularly the case in new rail-car manufacturing, where we have open production space,” said Greenbrier President and Chief Executive Officer William Furman in a prepared statement. “In the near term, our customers are moderating their demand for certain new car types, including intermodal and mill gondola cars, from what we previously anticipated.”

Also during the first fiscal quarter, Greenbrier’s backlog decreased slightly to 14,300 units valued at $980 million. On Aug. 31, 2006, the company’s backlog stood at 14,700 units valued at $1 billion. In addition, quarterly net earnings tumbled to $1.9 million compared with $8 million in first-quarter FY2006.

The lone bright spot: Quarterly revenue increased 32 percent to $247 million.

“We were obviously disappointed in our first-quarter financial results,” said Furman. “A number of operating and non-operating items combined to contribute to this performance.”