Greenbrier Companies, Inc. (the) · NYSE:GBX
Greenbrier Companies, Inc. (the) — KeyBanc Industrials & Basic Materials Conference June 2023
46 slides from Greenbrier Companies, Inc. (the)'s conference presentation, May 31, 2023
Slide 1: KeyBanc Industrials & Basic Materials Conference June 2023
Exhibit 99.1 NYSE: GBX KeyBanc Industrials & Basic Materials Conference June 2023
Slide 2: Forward Looking Statements & Non-GAAP Financial Measures
Forward Looking Statements & Non-GAAP Financial Measures This presentation and the accompanying oral presentation contain forward-looking statements, including statements that are not purely statements of historical fact. The Greenbrier Companies, Inc. (the “Company,” “we,” “us” or “our”) uses words
Slide 3: An Established Industry Leader
An Established Industry Leader Proven history of delivering strong performance Strategically positioned for growth
Slide 4: Greenbrier is a leading railcar manufacturer and lessor
The Greenbrier Companies is a leading railcar manufacturer and lessor Annual railcar Railcars in lease ~33,000 ~12,300 production capacity fleet Revenue visibility Strong financially Recurring revenue available $3.1bn backlog ~$815mn 35% growth liquidity 4 Note: Figures as of February 28, 2023
Slide 5: Delivering value to customers throughout railcar life cycle
Delivering value to our customers throughout railcar life cycle Produce virtually all Greenbrier has a fleet of (1) types of railcars for the ~12,300 railcars in North American, North America, covering Railcar Railcar European and Brazilian numerous car types Manufacturing Leasing markets. which ser
Slide 6: Illustrative example of complete solutions provider to customers
An illustrative example of how we act as a complete solutions provider to our customers Wheels & Incremental Benefits Parts + Syndication of railcars to Maintenance Services customer + Management Services Purchase of secondary market + railcars from customer Manufacturing Adds revenue Large-scale ra
Slide 7: Leading position in each geographic end market
Greenbrier has a leading position in each of its geographic end markets North American Backlog Share of Brazilian Production European Wagon Building Capacity 8% 12% 4% 22% 21% 5% 4% 3% 99% 93% 33% 7+ Small 26% 54% 30% 77% 76% builders, Top 5, excl. 30% GBX, 46% 50% 49% 45% 34% Greenbrier, 24% 2019 2
Slide 8: Leadership position across all major product types in North America
Greenbrier has a leadership position across all major product types in North America Description GBX RAIL TRN NSC UTLX Auto Rack Boxcar Refrigerated Flatcar Covered Hopper Gondola Intermodal Open-Top Hopper Tank Car 8 Primary Position Secondary Position
Slide 9: Management Services business delivers comprehensive service to lessor customers
Our Management Services business delivers comprehensive service to lessor customers (1) ~450,000 assets currently under management Customers include railroads, industrial shippers, investors, operating lessors Keep asset within repair & maintenance rules and fit for service Manages railcar Manages t
Slide 10: Maintenance services network provides strategic services to railcar owners
Maintenance services network provides strategic services to railcar owners 20 Production Facilities 491,000 maintenance hours annually 310,000 wheelsets and 90,000 axles annually 42,000 parts/units annually 10
Slide 11: Leasing is integral to the ongoing success of our business
Leasing is integral to the ongoing success of our business Maintain & Originate Manufacture Hold Syndicate Manage Strong origination Greenbrier Railcars reside on Railcars aggregated Long term capabilities and Manufacturing the balance sheet, and sold to 3rd management fees disciplined builds railca
Slide 12: Superior lease origination capability is a key enabler
Greenbrier’s superior lease origination capability is a key enabler to our business (1) Manufacturing Order Breakdown 20% 23% 37% 41% 42% 80% 77% 63% 59% 58% 2019 2020 2021 2022 2023 Direct Sales Leased Railcars 12 (1) Six months through February 28, 2023
Slide 13: Strong foundation for continued growth of lease fleet
Strong foundation is in place for the continued (1) growth of Greenbrier’s lease fleet Lease Types 12,300 4.1 Yrs railcars avg. remaining term 1% 22% ~$1.0Bn 122 net book value # of customers 76% 8.5 Yrs 98.7% avg. railcar age fleet utilization (LTM) Full service Net lease Offlease 13 (1) As of Febr
Slide 14: High-quality railcar portfolio diversified across car types and commodities
A high-quality portfolio of railcars with diversification across car types and commodities (1) (1) Lease Fleet Railcars by Age Lease Fleet Railcar Types 7.8k 37% 26% 25% 12% 1.5k 1.3k 0.6k 0.5k 0.3k 0.2k 0.1k 0-5 6-10 11-15 16-20 21-25 26-30 31-35 >35 Covered Hopper Box/Flat/Auto Tank OTH/Gondola Ye
Slide 15: Proven history of delivering strong performance
An Established Industry Leader Proven history of delivering strong performance Strategically positioned for growth
Slide 16: Growing EBITDA through cycles; current trough 3.1x prior trough average
Proven history of growing EBITDA through cycles; current trough is 3.1x prior trough average Adjusted EBITDA ($ millions) 3.1x higher than $474 ’09 – ’10 trough $434 average EBITDA $317 $318 $310 $291 $284 $254 $231 $161 $163 $145 $129 $112 $113 $103 $90 $76 $64 2005 2006 2007 2008 2009 2010 2011 20
Slide 17: Railcar backlog provides strong visibility into capacity requirements
Railcar backlog has historically provided strong visibility into capacity requirements Greenbrier New Railcar Backlog $5.0 $160 $4.5 $160 $4.7 $4.0 $160 $3.5 $159 $3.5 $3.0 $3.3 $3.3 $3.2 $3.1 $2.5 $159 $2.8 $2.8 $2.7 $2.0 $2.4 $159 $1.5 $159 $1.5 $1.0 $1.2 $159 $0.5 $0.0 $158 2012 2013 2014 2015 20
Slide 18: Track record of generating significant margin dollars
Demonstrated track record of generating significant margin dollars Consolidated Revenue ($ millions) Consolidated Margin ($ millions) $3,633 $390 $366 $353 $3,034 $2,978 $2,792 $306 $232 $1,748 2019 2020 2021 2022 LTM 2019 2020 2021 2022 LTM 2/28/23 2/28/2023 Consolidated Margin 10-year Average Cons
Slide 19: Focused on growth in segments that drive aggregate gross margins
We are focused on growth in segments that drive aggregate gross margins Contribution of non-Manufacturing Activities to Consolidated Margin 6.3% 4.4% 4.3% 4.0% 3.9% 3.2% 2018 2019 2020 2021 2022 LTM 2/28/23 19
Slide 20: Leasing & Management Services improving financial performance
Leasing & Management Services achieving consistently improving financial performance Segment Margin Segment Margin % 69% 68% $123 66% $105 55% $92 $86 31% $49 2019 2020 2021 2022 LTM 2/28/23 2019 2020 2021 2022 LTM 2/28/23 20
Slide 21: Actions to improve performance of maintenance services
Actions we have undertaken to improve performance of maintenance services ü Rationalizing network capacity to eliminate Maintenance Services Margin % underperformers ü Standardizing operating processes 9% ü Investing in training and workforce 7% development 7% 6% ü Investing in locations to minimize
Slide 22: Strategically positioned for growth
An Established Industry Leader Proven history of delivering strong performance Strategically positioned for growth
Slide 23: Strategic Initiatives
Strategic Initiatives 1 2 3 4 Capitalize on Continued Balanced Growth of healthy market manufacturing approach to recurring demand excellence capital allocation revenue 23
Slide 24: Railcar demand expected to approximate replacement demand
Railcar demand is expected to approximate replacement demand over the next several years North American Railcar Deliveries 49,465 42,500 40,950 40,735 40,575 36,750 33,417 29,280 2020 2021 2022 2023F 2024F 2025F 2026F 2027F Tanks Covered Hoppers Other Conversions 24 Source: FTR, RSI, GBX Marketing F
Slide 25: Business strategy aligns with evolving nature of railcar ownership
Our business strategy aligns well with the evolving nature of railcar ownership 25% 16% 47% 57% 19% 17% 9% 10% (2012) (2022) (2012) (2022) (2012) (2022) (2012) (2022) RAILROADS LESSORS SHIPPERS TTX POOL • Overall ownership continues • Shift from RR and shipper- • Shipper ownership share • Overall ma
Slide 26: Strong demand from Europe due to aging fleet and Green Deal
Strong demand from Europe due to aging fleet and requirements to meet Green Deal targets European Fleet Age vs NA Estimated Annual Freight Wagon Demand (# of wagons) 1,600,000 678,000 22,000 Estimated 2023 deliveries 22% > 30 years 38% 10,000 20 - 30 years 21% 12,000 23% < 20 years 57% 39% NA Europe
Slide 27: Identified margin dollars with other plans underway
We have already identified between $65 – 75 million of margin dollars with other plans underway Action North America Europe Ongoing annual savings of $15 – 20 million, or ~50 to 70 Capacity rationalization (1) bps of margin improvement Ongoing annual savings of $50 – 75 million, or ~170 to Cost opti
Slide 28: Disciplined approach to capital allocation
Disciplined approach to capital allocation • Preserve strong liquidity position Maintain Strong • Structure debt facilities to align with business 1 Balance Sheet • Reduce non-leasing debt • Investing in our long-term lease fleet to increase recurring Drive Through revenue and smooth cyclicality • I
Slide 29: Strong liquidity supported through syndications and leased railcar sales
Strong liquidity supported through syndications and leased railcar sales Total Liquidity Fleet Proceeds & Syndication Liquidity ($ millions) ($ millions) $920 $835 $816 $86 $703 $680 $666 $690 $188 $641 $147 $436 $448 $477 $404 $311 $834 $214 $208 $647 $543 $380 $330 $263 2018 2019 2020 2021 2022 LT
Slide 30: No near-term debt maturities; ~95% of debt fixed
No near-term debt maturities & ~95% of debt is fixed at an average rate of 3.6% $374 $313 $219 $206 $66 $48 2023 2024 2025 2026 2027 2028 2029 2024 Convert. Note Leasing Warehouse GBX Term Loan Leasing Term Loan 2028 Convert. Note ABS Notes 30
Slide 31: Corporate recourse debt will be materially reduced
Corporate recourse debt will be materially reduced over the next several years Recourse vs. Non-Recourse Debt ($ millions) Leasing Fleet Debt & Leverage 80% 800,000 85% $1,000 $976 $941 $941 75% 700,000 65% 600,000 $717 $671 $338 55% 46% 500,000 $587 $307 45% $268 $197 $195 400,000 $198 35% $347 300
Slide 32: Committed to increasing a profitable, durable revenue stream
Strategically committed to increasing a profitable, durable revenue stream Increasing net • Drives manufacturing volume Annual Margin investment in • Drives repair / management volume $15 - 20M owned fleet to: • Expanded market share • Strengthens customer >$300M / year relations for the next 5 • Re
Slide 33: Recurring revenue has grown ~35% and expected to double
Recurring revenue has grown by ~35%, and we expect it to double in the next five years (1) (2) Owned Fleet Managed Fleet Recurring Revenue ($Mn) ~ 450,000 12,300 $113 390,000 9,400 $83 2019 Current 2019 Current 2019 LTM 2/28/2023 (1) As of February 28, 2023 33 (2) As of March 31, 2023
Slide 34: Long-term targets presented at April 2023 Investor Day
Long-term targets presented at Greenbrier’s inaugural April 2023 Investor Day 34
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Slide 36: Driven by our values and commitments to stakeholders
We are driven by our values and commitments we have made to our stakeholders 2022 ESG Report highlights: • Advances ESG strategy which is built on a five- pillar foundation based on 2021’s materiality assessment • Focuses on pillars of Safety & Quality, People, Environmental Sustainability, Governan
Slide 37: We strive to be the standard setter in freight transportation
We strive to be the standard setter in the freight transportation industry 37
Slide 38: Human Capital Management integrates with broader objectives
Greenbrier’s Human Capital Management integrates with our broader objectives Safety Incident 1.09 Rate 100% DART Rate .95 Employee Resource Groups 72% 95% Participation Rate of DEI Training at U.S. Employee Engagement Production Sites Survey Completion Rate 7 38 * Source: Association of American Rai
Slide 39: Policy advocacy to protect & promote growth of freight rail
Policy advocacy to protect & promote model growth of freight rail Regulatory Agencies, Trade Associations & Coalitions Congress & The Administration § Engage Congress on vital legislative and AAR Interchange Agreement are the “rules of the railroad.” Both executive actions impacting rail: regulator
Slide 40: Income Statement Highlights
Income Statement Highlights (1) (1) Revenue ($ millions) Adjusted EBITDA ($ millions) Adjusted Diluted EPS $1,122.0 $0.99 $97.9 $950.7 $88.8 $793.5 $766.5 $682.8 $0.60 $51.7 $48.6 $48.7 $0.38 $0.09 $0.05 2Q22 3Q22 4Q22 1Q23 2Q23 2Q22 3Q22 4Q22 1Q23 2Q23 2Q22 3Q22 4Q22 1Q23 2Q23 Strong adjusted EBITD
Slide 41: Key Operational Metrics
Key Operational Metrics (1) (1) Backlog Deliveries Syndicated Deliveries 2,200 32,100 7,600 30,900 29,500 28,300 25,900 5,800 5,200 1,400 4,800 4,800 1,300 800 300 2Q22 3Q22 4Q22 1Q23 2Q23 2Q22 3Q22 4Q22 1Q23 2Q23 2Q22 3Q22 4Q22 1Q23 2Q23 Record quarter for deliveries at 7,600 units and orders of 4,
Slide 42: Balance Sheet & Cash Flow Trends
Balance Sheet & Cash Flow Trends Net Capex & Invest. in (2) Operating Cash Flow Net Funded Debt (1) Unconsolidated Affiliates $178.0 $127.9 $1,349 $159.1 $1,278 $1,077 $62.2 $1,044 $937 $43.7 $43.0 $561 ($23.6) $716.7 ($108.1) $(106.3) 2Q22 3Q22 4Q22 1Q23 2Q23 ($255.5) Leasing Non-Recourse Greenbrie
Slide 43: Annual Adjusted EBITDA Reconciliation
Annual Adjusted EBITDA Reconciliation Reconciliation of Net Earnings (loss) to Adjusted EBITDA (In millions) Year Ending August 31, LTM 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2/28/2023 $29.8 $39.0 $18.5 $14.2 ($57.9) $8.3 $8.4 $61.2 ($5.4) $149.8 $2
Slide 44: Quarterly Adjusted EBITDA Reconciliation
Quarterly Adjusted EBITDA Reconciliation Supplemental Disclosure Reconciliation of Net Earnings (Loss) to Adjusted EBITDA (In millions, unaudited) Quarter Ending Feb. 28, May 31, Aug. 31, Nov. 30, Feb. 28, 2022 2022 2022 2022 2023 Net earnings (loss) $11.2 $7.6 $29.4 ($17.3) $36.8 Interest and forei
Slide 45: Quarterly Adjusted Diluted EPS Reconciliation
Quarterly Adjusted Diluted EPS Reconciliation Supplemental Disclosure Reconciliation of Net Earnings (Loss) Attributable to Greenbrier to Adjusted Net Earnings (In millions, except per share amounts, unaudited) Quarter Ending Feb. 28, May 31, Aug. 31, Nov. 30, Feb. 28, 2022 2022 2022 2022 2023 Net e
Slide 46: KeyBanc Industrials & Basic Materials Conference June 2023
NYSE: GBX KeyBanc Industrials & Basic Materials Conference June 2023
Greenbrier Companies — KeyBanc Industrials & Basic Materials Conference June 2023 on 6ix