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Jun 30, 2023
Trinity Q2 2023 Earnings Report
Trinity's Q2 2023 earnings were announced, showcasing significant year-over-year improvements in revenue, EPS, and operational efficiency.
Key Takeaways
Trinity Industries reported a strong second quarter in 2023, marked by a 73% increase in revenue compared to the previous year, driven by higher railcar deliveries and improved lease rates. The company's EPS also saw a significant improvement, and lease fleet utilization remained high. Trinity is optimistic about continued growth in the second half of the year, supported by positive industry trends.
Total company revenues increased to $722 million, a 73% year-over-year improvement.
GAAP EPS from continuing operations rose to $0.23, a 64% year-over-year increase.
Lease fleet utilization was 97.9% with a Future Lease Rate Differential (FLRD) of positive 29.5% at quarter end.
The company delivered 4,985 railcars and received orders for 4,770 railcars, resulting in a backlog of $3.6 billion.
Trinity
Trinity
Trinity Revenue by Segment
Revenue by Segment
Railcar Leasing and Services Revenue
CapyFin.comRail Products Revenue
CapyFin.com Forward Guidance
Trinity Industries anticipates positive industry trends to persist in the latter half of the year, with revenue growth driven by increasing lease rates and consistent railcar deliveries. While margin improvement is expected, it will be partially offset by factors such as the strength of the Mexican peso, increased interest expenses, and a slower-than-anticipated recovery in efficiency and supply chain dynamics.
Positive Outlook
- Industry deliveries of approximately 45,000 railcars
- Net investment in the lease fleet of $250 million to $350 million
- Manufacturing capital expenditures of $40 million to $50 million
- Full year EPS of $1.35 to $1.45
- Rising lease rates reflect a balanced railcar fleet.
Challenges Ahead
- The strength of the Mexican peso may offset margin improvements.
- Higher interest expense may impact profitability.
- Slower recovery than expected in efficiency.
- Supply chain issues may persist.
- Excludes items outside of our core business operations
Revenue & Expenses
Visualization of income flow from segment revenue to net income