Greenbrier Narrows Loss to $3.2 Million

Railcar and barge builder Greenbrier lost $3.2 million in its September-November fiscal first quarter of 2010, less of a decline than its $3.9 million loss a year earlier.

"Our results continue to reflect depressed demand as a result of the weak economic environment," said William A. Furman, president and CEO. "We remain focused on cost containment and operational efficiency, and managing the company for cash flow and liquidity in this environment."

Greenbrier ended the quarter Nov. 30 with $65 million in cash and equivalents, down from $76 million three months earlier. The company said it also has $107 million in additional borrowing capacity.

Furman said despite signs of recovery in some parts of the economy, "North American rail loadings remain soft and a significant portion of the entire North American railcar fleet remains idle."

Freight car builders collect revenue when they deliver finished cars, and Greenbrier's 350 car deliveries in its latest quarter were down from 800 in the fiscal 2009 first quarter. Combined revenue from its rail and marine manufacturing, car parts and refurbishing, and a railcar leasing and fleet management segment totaled $172 million, down 33 percent.

Greenbrier valued its railcar orders backlog on Nov. 30 at $430 million, along with a barge backlog worth $96 million. The remaining car orders were adjusted for a December resolution of a long-disputed contract with GE Railcar Services, which sharply reduced GE's order for new cars. Greenbrier said its adjusted end-of-quarter backlog was for 4,900 cars, down from 15,900 a year earlier when it counted the original volume contracted by GE.

Furman said that besides resolving the GE order, "we are starting to see signs that certain of our markets are beginning to stabilize and slightly improve." He said the manufacturer is also making headway on its efficiency efforts and improving its "integrated business model."

- John D. Boyd, The Journal of Commerce Online.