GATX Posts Second Quarter 2017 Results

GATX Corporation has reported a net income of $53.4 million, or $1.35 per diluted share, for the 2017 second quarter compared to last year’s second quarter net income of $61.2 million, or $1.49 per diluted share.

“While North American railcar loadings and railroad velocity have trended favorably over the last few quarters, a recovery in the North American railcar leasing market continues to be hampered by a significant oversupply of existing railcars and a large railcar manufacturing backlog,” said GATX President and CEO Brian A. Kenney.

“GATX’s fleet utilization decreased slightly to 98.8 percent in the quarter, although we continue to displace competitors and protect high fleet utilization,” continued Kenney. “The renewal lease rate change of GATX’s Lease Price Index was a negative 21.4 percent in the quarter, as absolute railcar lease rates have remained flat thus far in 2017. Our commercial team has been successful in keeping existing cars on lease, as evidenced by our renewal success rate of 75.1 percent.”

The Rail North America segment of GATX reported a profit of $74.9 million for the 2017 second quarter, compared to $76.8 in last year’s second quarter. Higher gains on asset dispositions in the second quarter of 2017 were more than offset by lower lease revenue and higher maintenance expense, resulting in slightly lower segment profit.

Rail North America’s wholly owned fleet was approximately 121,000 cars as of June 30, 2017, including approximately 17,100 boxcars. Excluding the boxcar fleet, fleet utilization was 98.8 percent at the end of the second quarter, compared to 98.1 percent at the end of the 2016 second quarter.

Rail International’s first quarter segment profit was $16.6 million, compared to $13 million in the 2016 second quarter.

“Based on year-to-date performance and our outlook for the remainder of the year, we continue to expect our 2017 full-year earnings to be in the range of $4.40 to $4.60 per diluted share,” concluded Kenney.