Greenbrier sees ‘tragic’ Ukraine war creating ‘tremendous opportunities’ for its rail business
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Greenbrier Corporations Inc. claimed Wednesday that it swung to a fiscal 2nd-quarter profit and revenue that a lot more than doubled, as the war in Ukraine offered a boost to the maker of railroad freight automobiles and gear.
Government Chairman William Furman explained that most commodities shipped by rail have experienced upward pricing tension from provide and need constraints, owing to both sanctions on Russia and decreased generation from Russia and in Ukraine, and that has boosted railcar desire.
He added that when war in Ukraine is a “true tragedy,” it also delivers chances for main shifts in freight corridors and transportation modes that will boost Greenbrier’s small business.
“The commodity markets are typically main indicators for growth in rail freight,” Furman explained, according to a FactSet transcript of Greenbrier’s write-up-earnings meeting simply call with analysts. “We anticipate soaring international commodity selling prices and shifting trade patterns to elevate railcar demand from customers in North The united states and Brazil, and elsewhere in the environment.”
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““So there are superior factors that can arrive out of war, and we consider that our industry is 1 that will advantage.””
The enterprise
GBX,
described ahead of the open net cash flow for the quarter to Feb. 28 of $12.8 million, or 38 cents a share, immediately after a loss of $9.1 million, or 28 cents a share, in the very same period a 12 months in the past, to defeat the FactSet consensus for earnings per share of 19 cents.
Income grew 131.% to $682.8 million, well over the FactSet consensus of $575.8 million, as manufacturing earnings jumped 175.8% to $555.7 million.
New railcar orders ended up 8,500 units valued at $930 million, far more than double very last year’s new orders of 3,800 models valued at $440 million.
For fiscal 2022, the corporation expects deliveries of 17,500 to 19,500 models, in comparison with deliveries of 13,000 models in fiscal 2021.
Chief Executive Officer Lorie Tekorius reported in the submit-earnings meeting phone that “while no just one would would like for war,” what’s occurring in Ukraine and Russia will build “tremendous opportunities” for transportation by rail of bulk commodities, these kinds of as fertilizer, grains, crushed rock and petroleum goods.
“So there are excellent items that can arrive out of war, and we believe that our marketplace is a single that will benefit,” Tekorius claimed, according to a FactSet transcript.
In the meantime, Greenbrier’s inventory erased an before get of as a lot as 1.8% to fall 4.% in afternoon investing Wednesday, amid a broad and sharp selloff in the transportation sector.
The stock has drop 1.9% year to date, even though the Dow Jones Transportation Average
DJT,
has slumped 11.7% and the Dow Jones Industrial Average
DJIA,
has dropped 5.1%.
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