The Greenbrier Companies

Background

Founded in 1981 and headquartered in Lake Oswego, Oregon, The Greenbrier Companies is a leading international supplier of transportation equipment and services to the freight rail industry. The company specializes in the design, manufacturing, and marketing of railroad freight car equipment, as well as providing railcar refurbishment, leasing, and management services. With operations spanning North America, Europe, and South America, Greenbrier has established itself as a significant player in the global transportation sector.

Key Strategic Focus

Greenbrier's strategic focus encompasses several core objectives:

• Manufacturing Excellence: The company produces a diverse range of railcars, including boxcars, center partitions, covered hoppers, double stacks, flatcars, gondolas, tank cars, and proprietary automobile carriers like the AutoMax and Multi-Max.

• Leasing and Management Services: Greenbrier operates a railcar leasing business in North America through subsidiaries with a fleet of 15,200 railcars. As of Q3 2024, the fleet utilization rate was 99% with an average remaining lease term of 3.9 years. The company also offers comprehensive fleet management services, including maintenance management, car hire processing, regulatory compliance, and railcar re-marketing.

• Maintenance Services: The company operates a wheel service network that provides reconditioning for wheels and axles, as well as new axle machining, finishing, and downsizing. The railcar maintenance network performs routine upkeep for third parties and their leased and managed railcar fleets. They also have component parts facilities to recondition and manufacture various railcar items.

• Global Expansion: With manufacturing facilities in the United States, Mexico, Brazil, Poland, Romania, and Turkey, Greenbrier continues to expand its global footprint to meet the growing demand for freight railcar equipment and services.

Financials and Funding

As of the fiscal year ending August 31, 2024, Greenbrier reported:

• Revenue: $3.54 billion

• Net Income: $160.1 million

• Operating Cash Flow: $329.6 million

• Free Cash Flow: -$68.7 million

In the most recent quarter (Q4 2024), the company reported:

• Revenue: $1.05 billion

• Net Income: $62 million

• Operating Cash Flow: $192 million

• Free Cash Flow: $34 million

Greenbrier's liquidity position remains strong, with cash of $351.8 million and available borrowing capacity of $333.7 million under committed credit facilities. The company's current ratio stands at 1.68, with a quick ratio of 1.37, indicating a solid ability to meet short-term obligations.

Pipeline Development

Greenbrier maintains a robust pipeline of railcar manufacturing projects, with a backlog valued at approximately $3.7 billion. This backlog provides visibility into future revenue streams and reflects strong demand for the company's products. The company continues to invest in research and development to introduce innovative railcar designs and enhance existing models, ensuring compliance with evolving industry standards and customer requirements.

Technological Platform and Innovation

Greenbrier's commitment to innovation is evident through its significant investments in technological advancements:

• Proprietary Technologies: The company has developed advanced railcar monitoring systems and implemented AI-driven predictive maintenance technologies to enhance operational efficiency and safety.

• Sustainable Conversions™: Greenbrier offers rebody and stretch programs that convert existing covered hopper or tank car fleets, promoting sustainability by extending the service life of railcars and reducing environmental impact.

• Research and Development: In 2023, the company invested $42.3 million in research and development, focusing on advanced railcar design, sustainable transportation solutions, and digital monitoring technologies.

Leadership Team

Greenbrier's leadership team comprises experienced professionals dedicated to driving the company's strategic objectives:

• Lorie Tekorius: CEO & President, Board Member

• Thomas B. Fargo: Independent Director

• Graeme A. Jack: Independent Director

• David L. Starling: Independent Director

• Charles J. Swindells: Independent Director

Leadership Changes

In 2022, Greenbrier's founder and CEO, William A. Furman, stepped down as CEO and retired from the office of Executive Chairman. The Board of Directors appointed then-President & Chief Operating Officer Lorie Tekorius as CEO & President. Furman remained a director through the expiration of his term in January 2024.

Competitor Profile

Market Insights and Dynamics

The North American railcar manufacturing industry is composed of three publicly traded companies, which combined for a total of $7.2 billion in the last twelve months. Greenbrier holds 48% of the market share, while Trinity Industries and FreightCar America have 45%.