Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Nov. 30, 2018 | Jan. 03, 2019 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Nov. 30, 2018 | |
Document Fiscal Year Focus | 2,019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | GBX | |
Entity Registrant Name | GREENBRIER COMPANIES INC | |
Entity Central Index Key | 923,120 | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 32,350,212 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 462,797 | $ 530,655 |
Restricted cash | 8,872 | 8,819 |
Accounts receivable, net | 306,917 | 348,406 |
Inventories | 492,573 | 432,314 |
Leased railcars for syndication | 233,415 | 130,926 |
Equipment on operating leases, net | 317,282 | 322,855 |
Property, plant and equipment, net | 461,120 | 457,196 |
Investment in unconsolidated affiliates | 58,682 | 61,414 |
Intangibles and other assets, net | 95,958 | 94,668 |
Goodwill | 77,508 | 78,211 |
Total assets | 2,515,124 | 2,465,464 |
Liabilities and Equity | ||
Revolving notes | 22,189 | 27,725 |
Accounts payable and accrued liabilities | 438,304 | 449,857 |
Deferred income taxes | 30,631 | 31,740 |
Deferred revenue | 108,566 | 105,954 |
Notes payable, net | 487,764 | 436,205 |
Commitments and contingencies (Note 16) | ||
Contingently redeemable noncontrolling interest | 28,449 | 29,768 |
Greenbrier | ||
Preferred stock - without par value; 25,000 shares authorized; none outstanding | ||
Common stock - without par value; 50,000 shares authorized; 32,350 and 32,191 shares outstanding at November 30, 2018 and August 31, 2018 | 0 | 0 |
Additional paid-in capital | 440,958 | 442,569 |
Retained earnings | 846,018 | 830,898 |
Accumulated other comprehensive loss | (29,345) | (23,366) |
Total equity - Greenbrier | 1,257,631 | 1,250,101 |
Noncontrolling interest | 141,590 | 134,114 |
Total equity | 1,399,221 | 1,384,215 |
Liabilities and Equity | $ 2,515,124 | $ 2,465,464 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Nov. 30, 2018 | Aug. 31, 2018 |
Preferred stock, without par value | ||
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, outstanding | ||
Common stock, without par value | ||
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares outstanding | 32,350,000 | 32,191,000 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | ||
Revenue | |||
Revenue | $ 604,523 | $ 559,535 | |
Cost of revenue | |||
Cost of revenue | 531,990 | 470,221 | |
Margin | 72,533 | 89,314 | |
Selling and administrative expense | 50,432 | 47,043 | |
Net gain on disposition of equipment | (14,353) | (19,171) | |
Earnings from operations | 36,454 | 61,442 | |
Other costs | |||
Interest and foreign exchange | 4,404 | 7,020 | |
Earnings before income taxes and earnings (loss) from unconsolidated affiliates | 32,050 | 54,422 | |
Income tax expense | (9,135) | (18,135) | |
Earnings before earnings (loss) from unconsolidated affiliates | 22,915 | 36,287 | |
Earnings (loss) from unconsolidated affiliates | 467 | (2,910) | |
Net earnings | 23,382 | 33,377 | |
Net earnings attributable to noncontrolling interest | (5,426) | (7,124) | |
Net earnings attributable to Greenbrier | $ 17,956 | $ 26,253 | |
Basic earnings per common share: | $ 0.55 | $ 0.90 | |
Diluted earnings per common share: | [1] | $ 0.54 | $ 0.83 |
Weighted average common shares: | |||
Basic | [2] | 32,640 | 29,332 |
Diluted | 33,093 | 32,696 | |
Dividends declared per common share | $ 0.25 | $ 0.23 | |
Manufacturing | |||
Revenue | |||
Revenue | $ 471,789 | $ 451,485 | |
Cost of revenue | |||
Cost of revenue | 417,805 | 380,850 | |
Earnings from operations | 36,855 | 52,969 | |
Wheels, Repair & Parts | |||
Revenue | |||
Revenue | 108,543 | 78,011 | |
Cost of revenue | |||
Cost of revenue | 100,978 | 72,506 | |
Earnings from operations | 3,247 | 2,418 | |
Leasing & Services | |||
Revenue | |||
Revenue | 24,191 | 30,039 | |
Cost of revenue | |||
Cost of revenue | 13,207 | 16,865 | |
Earnings from operations | $ 17,513 | $ 28,190 | |
[1] | Diluted earnings per share was calculated as follows: Earnings before interest and debt issuance costs (net of tax) on convertible notes Weighted average diluted common shares outstanding | ||
[2] | Restricted stock grants and restricted stock units that are considered participating securities, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | ||
Net earnings | $ 23,382 | $ 33,377 | |
Other comprehensive income | |||
Translation adjustment | (3,931) | (3,187) | |
Reclassification of derivative financial instruments recognized in net earnings | [1] | 469 | (328) |
Unrealized gain (loss) on derivative financial instruments | [2] | (2,302) | 822 |
Other (net of tax effect) | (230) | (19) | |
Other comprehensive income | (5,994) | (2,712) | |
Comprehensive income | 17,388 | 30,665 | |
Comprehensive income attributable to noncontrolling interest | (5,411) | (7,120) | |
Comprehensive income attributable to Greenbrier | $ 11,977 | $ 23,545 | |
[1] | Net of tax effect of $0.2 million and $0.02 million for the three months ended November 30, 2018 and 2017. | ||
[2] | Net of tax effect of $0.9 million and $0.3 million for the three months ended November 30, 2018 and 2017. |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Reclassification of derivative financial instruments recognized in net earnings (loss), tax | $ 200 | $ 20 |
Unrealized loss on derivative financial instruments, tax | $ 900 | $ 300 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Total | Contingently Redeemable Noncontrolling Interest | Common Stock Shares | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Attributable to Greenbrier | Attributable to Noncontrolling Interest | Equity Excluding Contingently Redeemable Noncontrolling Interest [Member] |
Beginning balance at Aug. 31, 2017 | $ 36,148 | ||||||||
Net earnings | (939) | ||||||||
Ending Balance at Nov. 30, 2017 | 35,209 | ||||||||
Beginning balance (in shares) at Aug. 31, 2017 | 28,503 | ||||||||
Beginning balance at Aug. 31, 2017 | $ 315,306 | $ 709,103 | $ (6,279) | $ 1,018,130 | $ 160,763 | $ 1,178,893 | |||
Net earnings | $ 33,377 | 26,253 | 26,253 | 8,063 | 34,316 | ||||
Other comprehensive income, net | $ (2,712) | (2,708) | (2,708) | (4) | (2,712) | ||||
Noncontrolling interest adjustments | (882) | (882) | |||||||
Joint venture partner distribution declared | (26,789) | (26,789) | |||||||
Investment by joint venture partner | 6,500 | 6,500 | |||||||
Restricted stock awards (net of cancellations) (in shares) | 198 | ||||||||
Restricted stock awards (net of cancellations) | (5,061) | (5,061) | (5,061) | ||||||
Restricted stock amortization | 2,544 | 2,544 | 2,544 | ||||||
Cash dividends | (6,601) | (6,601) | (6,601) | ||||||
Ending Balance (in shares) at Nov. 30, 2017 | 28,701 | ||||||||
Ending Balance at Nov. 30, 2017 | 312,789 | 728,755 | (8,987) | 1,032,557 | 147,651 | 1,180,208 | |||
Beginning balance at Aug. 31, 2018 | 29,768 | ||||||||
Net earnings | (1,319) | ||||||||
Ending Balance at Nov. 30, 2018 | $ 28,449 | ||||||||
Beginning balance (in shares) at Aug. 31, 2018 | 32,191 | 32,191 | |||||||
Beginning balance at Aug. 31, 2018 | $ 1,384,215 | 442,569 | 830,898 | (23,366) | 1,250,101 | 134,114 | 1,384,215 | ||
Net earnings | 17,956 | 17,956 | 6,745 | 24,701 | |||||
Net earnings | 23,382 | ||||||||
Other comprehensive income, net | $ (5,994) | (5,979) | (5,979) | (15) | (5,994) | ||||
Noncontrolling interest adjustments | 3,919 | 3,919 | |||||||
Joint venture partner distribution declared | (3,173) | (3,173) | |||||||
Restricted stock awards (net of cancellations) (in shares) | 159 | ||||||||
Restricted stock awards (net of cancellations) | 11,416 | 11,416 | 11,416 | ||||||
Unamortized restricted stock | (16,163) | (16,163) | (16,163) | ||||||
Restricted stock amortization | 3,136 | 3,136 | 3,136 | ||||||
Cash dividends | (8,297) | (8,297) | (8,297) | ||||||
Ending Balance (in shares) at Nov. 30, 2018 | 32,350 | 32,350 | |||||||
Ending Balance at Nov. 30, 2018 | $ 1,399,221 | $ 440,958 | 846,018 | $ (29,345) | 1,257,631 | $ 141,590 | 1,399,221 | ||
Cumulative effect adjustment due to adoption of ASU 2014-09 (See Note 1) | Accounting Standards Update 2014-09 | $ 5,461 | $ 5,461 | $ 5,461 |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Cash dividend per share | $ 0.25 | $ 0.23 |
Equity Excluding Contingently Redeemable Noncontrolling Interest [Member] | ||
Cash dividend per share | $ 0.25 | $ 0.23 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Cash flows from operating activities | ||
Net earnings | $ 23,382 | $ 33,377 |
Adjustments to reconcile net earnings to net cash used in operating activities: | ||
Deferred income taxes | (2,360) | (5,865) |
Depreciation and amortization | 20,700 | 18,370 |
Net gain on disposition of equipment | (14,353) | (19,171) |
Accretion of debt discount | 1,076 | 1,024 |
Stock based compensation expense | 3,194 | 5,939 |
Noncontrolling interest adjustments | 3,920 | (875) |
Other | 286 | 477 |
Decrease (increase) in assets: | ||
Accounts receivable, net | 54,834 | (35,510) |
Inventories | (63,045) | (16,311) |
Leased railcars for syndication | (116,726) | (35,541) |
Other | (392) | 6,304 |
Increase (decrease) in liabilities: | ||
Accounts payable and accrued liabilities | (10,949) | 16,676 |
Deferred revenue | 3,314 | (8,548) |
Net cash used in operating activities | (97,119) | (39,654) |
Cash flows from investing activities | ||
Proceeds from sales of assets | 34,497 | 75,060 |
Capital expenditures | (28,677) | (29,893) |
Investment in and advances to unconsolidated affiliates | (11,393) | |
Cash distribution from joint ventures | 1,784 | |
Net cash provided by (used in) investing activities | (3,789) | 45,167 |
Cash flows from financing activities | ||
Net change in revolving notes with maturities of 90 days or less | (4,840) | 2,561 |
Proceeds from issuance of notes payable | 225,000 | 2,138 |
Debt issuance costs | (2,766) | |
Repayments of notes payable | (173,453) | (2,809) |
Investment by joint venture partner | 6,500 | |
Cash distribution to joint venture partner | (3,185) | (26,900) |
Dividends | (467) | (319) |
Tax payments for net share settlement of restricted stock | (4,747) | (5,061) |
Net cash provided by (used in) financing activities | 35,542 | (23,890) |
Effect of exchange rate changes | (2,439) | (1,736) |
Decrease in cash and cash equivalents and restricted cash | (67,805) | (20,113) |
Cash and cash equivalents and restricted cash | ||
Beginning of period | 539,474 | 620,358 |
End of period | 471,669 | 600,245 |
Balance Sheet Reconciliation: | ||
Cash and cash equivalents | 462,797 | 591,406 |
Restricted cash | 8,872 | 8,839 |
Total cash, cash equivalents and restricted cash as presented above | 471,669 | 600,245 |
Cash paid during the period for | ||
Interest | 1,740 | 3,662 |
Income taxes, net | 7,487 | 385 |
Non-cash activity | ||
Transfer from Leased railcars for syndication and Inventories to Equipment on operating leases, net | 14,304 | |
Capital expenditures accrued in Accounts payable and accrued liabilities | 6,972 | 14,840 |
Dividends declared and accrued in Accounts payable and accrued liabilities | $ 7,830 | $ 6,282 |
Interim Financial Statements
Interim Financial Statements | 3 Months Ended |
Nov. 30, 2018 | |
Interim Financial Statements | Note 1 – Interim Financial Statements The Condensed Consolidated Financial Statements of The Greenbrier Companies, Inc. and its subsidiaries (Greenbrier or the Company) as of November 30, 2018 and for the three months ended November 30, 2018 and 2017 have been prepared to reflect all adjustments (consisting of normal recurring accruals) that, in the opinion of management, are necessary for a fair presentation of the financial position, operating results and cash flows for the periods indicated. The results of operations for the three months ended November 30, 2018 are not necessarily indicative of the results to be expected for the entire year ending August 31, 2019. Certain notes and other information have been condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. 10-K. Management Estimates – Initial Adoption of Accounting Policies 2014-09, Revenue from Contracts with Customers 2014-09). In the first quarter of 2019, the Company adopted Accounting Standard Update 2016-18, Restricted Cash 2016-18). beginning-of-period end-of-period 2016-18 Prospective Accounting Changes 2016-02, Leases 2016-02). 2016-02 right-of-use In August 2017, the FASB issued Accounting Standards Update 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities 2017-12). non-financial Share Repurchase Program The Company did not repurchase any shares during the three months ended November 30, 2018. As of November 30, 2018, the Company had cumulatively repurchased 3,206,226 shares for approximately $137.0 million since October 2013 and had $88.0 million available under the share repurchase program. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Nov. 30, 2018 | |
Revenue Recognition | Note 2 – Revenue Recognition The Company measures revenue at the amounts that reflect the consideration to which it is expected to be entitled in exchange for transferring control of goods and services to customers. The Company recognizes revenue either at the point in time or over the period of time that performance obligations to customers are satisfied. Payment terms vary by segment and product type and are generally due within normal commercial terms. The Company’s contracts with customers may include multiple performance obligations (e.g. railcars, maintenance, management services, etc.). For such arrangements, the Company allocates revenues to each performance obligation based on their relative standalone selling price. The Company has disaggregated revenue from contracts with customers into categories which describe the principal activities from which the Company generates its revenues. See Note 14 - Segments for further disaggregated revenue information. Manufacturing Railcars are manufactured in accordance with contracts with customers. The Company recognizes revenue upon its customers’ acceptance of the completed railcars at a specified delivery point. From time to time, the Company enters into multi-year supply agreements. Each railcar delivery is considered a distinct performance obligation, such that the amounts that are recognized as revenue following railcar delivery are generally not subject to change. The Company typically recognizes marine vessel manufacturing revenue over time using the cost input method, based on progress toward contract completion measured by actual costs incurred to date in relation to the estimate of total expected costs. This method best depicts the Company’s performance in completing the construction of the marine vessel for the customer and is consistent with the percentage of completion method used prior to the adoption of the new revenue standard. Wheels, Repair & Parts The Company operates a network of wheel, repair and parts shops in North America that provide complete wheelset reconditioning and railcar repair services. Wheels revenue is recognized when wheelsets are shipped to the customer or when consumed by customers in the case of consignment arrangements. Parts revenue is recognized upon shipment of the parts to the customers. Repair revenue is typically recognized over time using the cost input method, based on progress toward contract completion measured by actual costs incurred to date in relation to the estimate of total expected costs. This method best depicts the Company’s performance in repairing the railcars for the customer. Repair services are typically completed in less than 90 days. Leasing & Services The Company owns a fleet of new and used cars which are leased to third-party customers. Lease revenue is recognized over the lease-term in the period in which it is earned in accordance with ASC 840: Leases Syndication transactions represent new and used railcars which have been placed on lease to a customer and which the Company intends to sell to an investor with the lease attached. At the time of such sale, revenue and cost of revenue associated with railcars that the Company has manufactured are recognized in the Manufacturing segment; while revenue and cost of revenue associated with railcars which were obtained from a third-party with the intent to resell them and subsequently sold, are recognized in the Leasing & Services segment in accordance with ASC 840: Leases The Company enters into multi-year contracts to provide management and maintenance services to customers for which revenue is generally recognized ratably over the contract term as a stand-ready obligation. Costs to fulfill these contracts are recognized as incurred. Contract balances Contract assets primarily consist of unbilled receivables related to marine vessel construction and repair services, for which the respective contracts do not yet permit billing at the reporting date. Contract liabilities primarily consist of customer prepayments for manufacturing, maintenance, and other management-type services, for which the Company has not yet satisfied the related performance obligations. The opening and closing balances of the Company’s contract balances are as follows: (in thousands) Balance sheet classification September 1, November 30, $ Contract assets Inventories $ 7,228 $ 9,741 $ 2,513 Contract liabilities 1 Deferred revenue $ 41,250 $ 36,763 $ (4,487 ) 1 Contract liabilities balance includes deferred revenue within the scope of the new revenue standard. For the three months ended November 30, 2018, the Company recognized $5.3 million of revenue that was included in Contract liabilities as of September 1, 2018. Performance obligations As of November 30, 2018, the Company has entered into contracts with customers for which revenue has not yet been recognized. The following table outlines estimated revenue related to performance obligations wholly or partially unsatisfied, that the Company anticipates will be recognized in future periods. (in millions) November 30, Revenue type 1 Manufacturing – Railcar Sales $ 2,011.8 Manufacturing – Railcars intended for syndication 2 $ 647.3 Manufacturing – Marine $ 55.9 Services $ 138.7 1 Unsatisfied performance obligation related to Wheels, Repair & Parts revenue is not material 2 Not within the scope of the new revenue standard Based on current production schedules and existing contracts, approximately $1.1 billion of the Railcar Sales amount is expected to be recognized in the remainder of fiscal 2019 while the remaining amount is expected in future periods. The table above excludes estimated revenue to be recognized at the Company’s Brazilian manufacturing operation, as they are accounted for under the equity method. Revenue amounts reflected in Railcars intended for syndication may be syndicated to third parties or held in the Company’s fleet depending on a variety of factors. Marine revenue is expected to be recognized from 2019-2020 as vessel construction is completed. Services includes management and maintenance services of which approximately 60% are expected to be performed from 2019-2024 and the remaining amount ratably through 2037. |
Acquisitions
Acquisitions | 3 Months Ended |
Nov. 30, 2018 | |
Acquisitions | Note 3 – Acquisitions On August 20, 2018, the Company entered into a dissolution agreement with Watco Companies, LLC, its previous joint venture partner, to discontinue their GBW Railcar Services railcar repair joint venture. Pursuant to the dissolution agreement, previously operated Greenbrier repair shops and associated employees were returned to the Company. Additionally, the dissolution agreement provides that certain agreements entered into in connection with the original creation of GBW in 2014 were terminated as of the transaction date, including the leases of real and personal property, service agreements, and certain employment-related agreements. GBW will complete its cessation of activities in an orderly manner in fiscal 2019. As the assets received and liabilities assumed from GBW meet the definition of a business, the Company has accounted for this transaction as a business combination. The total net assets acquired were approximately $56.8 million. Additionally, the Company removed the book value of its remaining equity method investment in, and note receivable due from, the joint venture. The accumulated deficit reflected in GBW’s balance sheet as of August 31, 2018 continues to be funded by the joint venture partners. The Company has included this assumed liability within the purchase price allocation in the table below. For the three months ended November 30, 2018, the Repair operations contributed by this acquisition generated revenues of $23.9 million and a loss from operations of $1.4 million, which are reported in the Company’s condensed consolidated financial statements as part of the Wheels, Repair & Parts segment. The impact of the acquisition was not material to the Company’s results of operations, therefore pro forma financial information has not been included. The preliminary allocation of the purchase price based on the fair value of the net assets acquired was: (in thousands) Cash and cash equivalents $ 5,000 Accounts receivable, net 12,230 Inventories 18,106 Property, plant and equipment, net 16,748 Intangibles and other assets, net 9,200 Goodwill 7,863 Total assets acquired 69,147 Accounts payable and accrued liabilities 12,394 Total liabilities assumed 12,394 Net assets acquired $ 56,753 Certain liabilities in the table above are estimates and the Company will adjust the purchase price allocation as they are settled. |
Inventories
Inventories | 3 Months Ended |
Nov. 30, 2018 | |
Inventories | Note 4 – Inventories Inventories are valued at the lower of cost (first-in, first-out) Work-in-process (In thousands) November 30, August 31, Manufacturing supplies and raw materials $ 286,779 $ 278,726 Work-in-process 107,377 105,021 Finished goods 104,933 54,181 Excess and obsolete adjustment (6,516 ) (5,614 ) $ 492,573 $ 432,314 |
Intangibles and Other Assets, n
Intangibles and Other Assets, net | 3 Months Ended |
Nov. 30, 2018 | |
Intangibles and Other Assets, net | Note 5 – Intangibles and Other Assets, net Intangible assets that are determined to have finite lives are amortized over their useful lives. Intangible assets with indefinite useful lives are not amortized and are periodically evaluated for impairment. The following table summarizes the Company’s identifiable intangible and other assets balance: (In thousands) November 30, August 31, Intangible assets subject to amortization: Customer relationships $ 72,625 $ 72,521 Accumulated amortization (44,687 ) (43,576 ) Other intangibles 15,925 16,300 Accumulated amortization (7,167 ) (6,400 ) 36,696 38,845 Intangible assets not subject to amortization 4,970 5,115 Prepaid and other assets 20,018 18,935 Nonqualified savings plan investments 26,992 26,299 Revolving notes issuance costs, net 3,632 1,824 Assets held for sale 3,650 3,650 Total Intangible and other assets, net $ 95,958 $ 94,668 Amortization expense was $1.9 million and $1.4 million for the three months ended November 30, 2018 and 2017, respectively. Amortization expense for the years ending August 31, 2019, 2020, 2021, 2022 and 2023 is expected to be $5.8 million, $5.1 million, $5.1 million, $3.7 million and $3.5 million, respectively. |
Revolving Notes
Revolving Notes | 3 Months Ended |
Nov. 30, 2018 | |
Revolving Notes | Note 6 – Revolving Notes Senior secured credit facilities, consisting of three components, aggregated to $689.0 million as of November 30, 2018. As of November 30, 2018, a $600.0 million revolving line of credit, maturing September 2023, secured by substantially all the Company’s assets in the U.S. not otherwise pledged as security for term loans, was available to provide working capital and interim financing of equipment, principally for the U.S. and Mexican operations. Advances under this facility bear interest at LIBOR plus 1.50% or Prime plus 0.50% depending on the type of borrowing. Available borrowings under the credit facility are generally based on defined levels of inventory, receivables, property, plant and equipment and leased equipment, as well as total debt to consolidated capitalization and fixed charges coverage ratios. As of November 30, 2018, lines of credit totaling $39.0 million secured by certain of the Company’s European assets, with variable rates that range from Warsaw Interbank Offered Rate (WIBOR) plus 1.1% to WIBOR plus 1.3% and Euro Interbank Offered Rate (EURIBOR) plus 1.1%, were available for working capital needs of the European manufacturing operation. European credit facilities are continually being renewed. Currently, these European credit facilities have maturities that range from February 2019 through September 2020. As of November 30, 2018, the Company’s Mexican railcar manufacturing joint venture had two lines of credit totaling $50.0 million. The first line of credit provides up to $30.0 million and is fully guaranteed by the Company and its joint venture partner. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw against this facility through January 2019 and the line of credit is currently in the process of being renewed. The second line of credit provides up to $20.0 million, of which the Company and its joint venture partner have each guaranteed 50%. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw amounts available under this facility through July 2019. As of November 30, 2018, outstanding commitments under the senior secured credit facilities consisted of $72.4 million in letters of credit under the North American credit facility and $22.2 million outstanding under the European credit facilities. As of August 31, 2018, outstanding commitments under the senior secured credit facilities consisted of $72.2 million in letters of credit under the North American credit facility and $27.7 million outstanding under the European credit facilities. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities | 3 Months Ended |
Nov. 30, 2018 | |
Accounts Payable and Accrued Liabilities | Note 7 – Accounts Payable and Accrued Liabilities (In thousands) November 30, August 31, Trade payables $ 224,059 $ 226,405 Other accrued liabilities 78,726 73,273 Accrued payroll and related liabilities 87,182 105,111 Accrued warranty 26,264 27,395 Income taxes payable 11,438 4,771 Other 10,635 12,902 $ 438,304 $ 449,857 |
Warranty Accruals
Warranty Accruals | 3 Months Ended |
Nov. 30, 2018 | |
Warranty Accruals | Note 8 – Warranty Accruals Warranty costs are estimated and charged to operations to cover a defined warranty period. The estimated warranty cost is based on the history of warranty claims for each particular product type. For new product types without a warranty history, preliminary estimates are based on historical information for similar product types. The warranty accruals, included in Accounts payable and accrued liabilities on the Consolidated Balance Sheets, are reviewed periodically and updated based on warranty trends and expirations of warranty periods. Warranty accrual activity: Three Months Ended (In thousands) 2018 2017 Balance at beginning of period $ 27,395 $ 20,737 Charged to cost of revenue, net 1,441 1,953 Payments (2,184 ) (751 ) Currency translation effect (388 ) 13 Balance at end of period $ 26,264 $ 21,952 |
Notes Payable
Notes Payable | 3 Months Ended |
Nov. 30, 2018 | |
Notes Payable | Note 9 – Notes Payable In September 2018, the Company refinanced approximately $170 million of existing senior term debt, due in March 2020, secured by a pool of leased railcars with new 5-year |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Nov. 30, 2018 | |
Accumulated Other Comprehensive Loss | Note 10 – Accumulated Other Comprehensive Loss Accumulated other comprehensive loss, net of tax effect as appropriate, consisted of the following: (In thousands) Unrealized Foreign Other Accumulated Balance, August 31, 2018 $ (431 ) $ (21,506 ) $ (1,429 ) $ (23,366 ) Other comprehensive loss before reclassifications (2,302 ) (3,916 ) (230 ) (6,448 ) Amounts reclassified from Accumulated other comprehensive loss 469 — — 469 Balance, November 30, 2018 $ (2,264 ) $ (25,422 ) $ (1,659 ) $ (29,345 ) The amounts reclassified out of Accumulated other comprehensive loss into the Consolidated Statements of Income, with presentation location, were as follows: (In thousands) Three Months Ended Financial Statement Location 2018 2017 (Gain) loss on derivative financial instruments: Foreign exchange contracts $ 488 $ (511 ) Revenue and Cost of revenue Interest rate swap contracts 144 167 Interest and foreign exchange 632 (344 ) Total before tax (163 ) 16 Tax expense $ 469 $ (328 ) Net of tax |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Nov. 30, 2018 | |
Earnings Per Share | Note 11 – Earnings Per Share The shares used in the computation of basic and diluted earnings per common share are reconciled as follows: (In thousands) Three Months Ended 2018 2017 Weighted average basic common shares outstanding (1) 32,640 29,332 Dilutive effect of 2018 Convertible notes (2) — 3,331 Dilutive effect of 2024 Convertible notes (3) — — Dilutive effect of restricted stock units (4) 453 33 Weighted average diluted common shares outstanding 33,093 32,696 (1) Restricted stock grants and restricted stock units that are considered participating securities, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position. (2) The dilutive effect of the 2018 Convertible notes was included for the three months ended November 30, 2017 as they were considered dilutive under the “if converted” method as further discussed below. The 2018 Convertible notes matured on April 1, 2018. (3) The dilutive effect of the 2024 Convertible notes was excluded for the three months ended November 30, 2018 and 2017 as the average stock price was less than the applicable conversion price and therefore was considered anti-dilutive. (4) Restricted stock units that are not considered participating securities and restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position. Diluted EPS is calculated using the more dilutive of two approaches. The first approach includes the dilutive effect, using the treasury stock method, associated with shares underlying the 2024 Convertible notes, restricted stock units that are not considered participating securities and performance based restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved. The second approach supplements the first by including the “if converted” effect of the 2018 Convertible notes during the periods in which they were outstanding. Under the “if converted” method, debt issuance and interest costs, both net of tax, associated with the convertible notes are added back to net earnings and the share count is increased by the shares underlying the convertible notes. The 2024 Convertible notes are included in the calculation of both approaches using the treasury stock method when the average stock price is greater than the applicable conversion price. Three Months Ended 2018 2017 Net earnings attributable to Greenbrier $ 17,956 $ 26,253 Add back: Interest and debt issuance costs on the 2018 Convertible notes, net of tax n/a 733 Earnings before interest and debt issuance costs on 2018 Convertible Notes n/a $ 26,986 Weighted average diluted common shares outstanding 33,093 32,696 Diluted earnings per share (1) $ 0.54 $ 0.83 (1) Diluted earnings per share was calculated as follows: Earnings before interest and debt issuance costs (net of tax) on convertible notes Weighted average diluted common shares outstanding |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Nov. 30, 2018 | |
Stock Based Compensation | Note 12 – Stock Based Compensation The value of stock based compensation awards is amortized as compensation expense from the date of grant through the earlier of the vesting period or in some instances the recipient’s eligible retirement date. Stock based compensation expense consists of restricted stock units, restricted stock and phantom stock units awards. Stock based compensation expense was $3.2 million for the three months ended November 30, 2018 and $5.9 million for the three months ended November 30, 2017. Compensation expense is recorded in Selling and administrative expense and Cost of revenue on the Consolidated Statements of Income. |
Derivative Instruments
Derivative Instruments | 3 Months Ended |
Nov. 30, 2018 | |
Derivative Instruments | Note 13 – Derivative Instruments Foreign operations give rise to market risks from changes in foreign currency exchange rates. Foreign currency forward exchange contracts with established financial institutions are utilized to hedge a portion of that risk. Interest rate swap agreements are used to reduce the impact of changes in interest rates on certain debt. The Company’s foreign currency forward exchange contracts and interest rate swap agreements are designated as cash flow hedges, and therefore the effective portion of unrealized gains and losses is recorded in accumulated other comprehensive income or loss. At November 30, 2018 exchange rates, forward exchange contracts for the purchase of Polish Zlotys and the sale of Euros; the purchase of Mexican Pesos and the sale of U.S. Dollars; and for the purchase of U.S. Dollars and the sale of Saudi Riyals aggregated to $139.8 million. The fair value of the contracts is included on the Consolidated Balance Sheets as Accounts payable and accrued liabilities when there is a loss, or as Accounts receivable, net when there is a gain. As the contracts mature at various dates through March 2021, any such gain or loss remaining will be recognized in manufacturing revenue or cost of revenue along with the related transactions. In the event that the underlying transaction does not occur or does not occur in the period designated at the inception of the hedge, the amount classified in accumulated other comprehensive loss would be reclassified to the results of operations in Interest and foreign exchange at the time of occurrence. At November 30, 2018 exchange rates, approximately $2.4 million would be reclassified to revenue or cost of revenue in the next year. At November 30, 2018, an interest rate swap agreement maturing in September 2023 had a notional amount of $112.5 million. The fair value of the contract is included on the Consolidated Balance Sheets in Accounts payable and accrued liabilities when there is a loss, or in Accounts receivable, net when there is a gain. As interest expense on the underlying debt is recognized, amounts corresponding to the interest rate swap are reclassified from Accumulated other comprehensive loss and charged or credited to interest expense. At November 30, 2018 interest rates, approximately $0.8 million would be reclassified to interest expense in the next year. Fair Values of Derivative Instruments Asset Derivatives Liability Derivatives November 30, August 31, November 30, August 31, (In thousands) Balance sheet location Fair Fair Balance sheet location Fair Fair Derivatives designated as hedging instruments Foreign forward exchange contracts Accounts receivable, net $ 755 $ 700 Accounts payable and accrued liabilities $ 1,857 $ 1,211 Interest rate swap contracts Accounts receivable, net — 781 Accounts payable and accrued liabilities 790 1 $ 755 $ 1,481 $ 2,647 $ 1,212 Derivatives not designated as hedging instruments Foreign forward exchange contracts Accounts receivable, net $ 144 $ 76 Accounts payable and accrued liabilities $ 46 $ 354 Interest rate swap contracts Accounts receivable, net — — Accounts payable and accrued liabilities 105 — $ 144 $ 76 $ 151 $ 354 The Effect of Derivative Instruments on the Statements of Income Derivatives in cash flow hedging relationships Location of gain (loss) recognized in income on derivatives Gain (loss) 2018 2017 Foreign forward exchange contract Interest and foreign exchange $ 380 $ 380 Interest rate swap contracts Interest and foreign exchange — (17 ) $ 380 $ 363 Derivatives in cash flow hedging relationships Gain (loss) Location of gain (loss) into income Gain (loss) Location of gain (loss) on Gain (loss) recognized on 2018 2017 2018 2017 2018 2017 Foreign forward exchange contracts $ 72 $ 730 Revenue $ (256 ) $ 710 Revenue $ 262 $ 56 Foreign forward exchange contracts (1,495 ) (354 ) Cost of revenue (232 ) (199 ) Cost of revenue 389 82 Interest rate swap contracts (1,773 ) 771 Interest and foreign exchange (144 ) (167 ) Interest and foreign exchange (47 ) — $ (3,196 ) $ 1,147 $ (632 ) $ 344 $ 604 $ 138 |
Segment Information
Segment Information | 3 Months Ended |
Nov. 30, 2018 | |
Segment Information | Note 14 – Segment Information The Company operates in three reportable segments: Manufacturing; Wheels, Repair & Parts; and Leasing & Services. Prior to August 20, 2018, the Company operated in four reportable segments: Manufacturing; Wheels, Repair & Parts; Leasing & Services; and GBW Joint Venture. On August 20, 2018 the Company entered into an agreement with its joint venture partner to discontinue the GBW railcar repair joint venture, which resulted in 12 repair shops returned to the Company. Beginning on August 20, 2018, the GBW Joint Venture is no longer considered a reportable segment. The accounting policies of the segments are described in the summary of significant accounting policies in the Consolidated Financial Statements contained in the Company’s 2018 Annual Report on Form 10-K The information in the following table is derived directly from the segments’ internal financial reports used for corporate management purposes. The results of operations for the GBW Joint Venture are not reflected in the tables below as the investment was accounted for under the equity method of accounting. For the three months ended November 30, 2018: Revenue Earnings (loss) from operations (In thousands) External Intersegment Total External Intersegment Total Manufacturing $ 471,789 $ 6,201 $ 477,990 $ 36,855 $ 433 $ 37,288 Wheels, Repair & Parts 108,543 15,981 124,524 3,247 312 3,559 Leasing & Services 24,191 5,999 30,190 17,513 5,452 22,965 Eliminations — (28,181 ) (28,181 ) — (6,197 ) (6,197 ) Corporate — — — (21,161 ) — (21,161 ) $ 604,523 $ — $ 604,523 $ 36,454 $ — $ 36,454 For the three months ended November 30, 2017: Revenue Earnings (loss) from operations (In thousands) External Intersegment Total External Intersegment Total Manufacturing $ 451,485 $ 16,804 $ 468,289 $ 52,969 $ 4,186 $ 57,155 Wheels, Repair & Parts 78,011 7,732 85,743 2,418 748 3,166 Leasing & Services 30,039 1,605 31,644 28,190 1,372 29,562 Eliminations — (26,141 ) (26,141 ) — (6,306 ) (6,306 ) Corporate — — — (22,135 ) — (22,135 ) $ 559,535 $ — $ 559,535 $ 61,442 $ — $ 61,442 Total assets November 30, August 31, (In thousands) 2018 2018 Manufacturing $ 998,820 $ 1,020,757 Wheels, Repair & Parts 322,525 306,756 Leasing & Services 691,389 578,818 Unallocated 502,390 559,133 $ 2,515,124 $ 2,465,464 Reconciliation of Earnings from operations to Earnings before income tax and earnings (loss) from unconsolidated affiliates: Three Months Ended (In thousands) 2018 2017 Earnings from operations $ 36,454 $ 61,442 Interest and foreign exchange 4,404 7,020 Earnings before income tax and earnings (loss) from unconsolidated affiliates $ 32,050 $ 54,422 |
Income Taxes
Income Taxes | 3 Months Ended |
Nov. 30, 2018 | |
Income Taxes | Note 15 – Income Taxes The Company recognized the income tax effects of the Tax Cuts and Jobs Act (Tax Act) in accordance with Staff Accounting Bulletin No. 118 (SAB 118), which required the financial results to reflect effects for which the accounting is complete and those which are provisional. Provisional effects were adjusted during the measurement period determined under SAB 118 based on ongoing analysis of data, tax positions and regulatory guidance. The accounting was considered complete as of November 30, 2018. There were no material adjustments made to the provisional effects during the three months ended November 30, 2018. The Tax Act also made other significant changes to U.S. federal income tax laws, including a global intangible low-taxed |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Nov. 30, 2018 | |
Commitments and Contingencies | Note 16 – Commitments and Contingencies Portland Harbor Superfund Site The Company’s Portland, Oregon manufacturing facility is located adjacent to the Willamette River. In December 2000, the U.S. Environmental Protection Agency (EPA) classified portions of the Willamette River bed known as the Portland Harbor, including the portion fronting the Company’s manufacturing facility, as a federal “National Priority List” or “Superfund” site due to sediment contamination (the Portland Harbor Site). The Company and more than 140 other parties have received a “General Notice” of potential liability from the EPA relating to the Portland Harbor Site. The letter advised the Company that it may be liable for the costs of investigation and remediation (which liability may be joint and several with other potentially responsible parties) as well as for natural resource damages resulting from releases of hazardous substances to the site. Ten private and public entities, including the Company (the Lower Willamette Group or LWG), signed an Administrative Order on Consent (AOC) to perform a remedial investigation/feasibility study (RI/FS) of the Portland Harbor Site under EPA oversight, and several additional entities have not signed such consent, but nevertheless contributed money to the effort. The EPA-mandated 17-year 17-year Separate from the process described above, which focused on the type of remediation to be performed at the Portland Harbor Site and the schedule for such remediation, 83 parties, including the State of Oregon and the federal government, entered into a non-judicial Arkema Inc. et al v. A & C Foundry Products, Inc. et al #3:09-cv-453-PK. The EPA’s January 6, 2017 ROD identifies a clean-up -30% 2-year clean-up clean-up The ROD does not address responsibility for the costs of clean-up, pre-remedial On January 30, 2017 the Confederated Tribes and Bands of Yakama Nation sued 33 parties including the Company as well as the United States and the State of Oregon for costs it incurred in assessing alleged natural resource damages to the Columbia River from contaminants deposited in Portland Harbor. Confederated Tribes and Bands of the Yakama Nation v. Air Liquide America Corp., et al., 3i17-CV-00164-SB. Oregon Department of Environmental Quality (DEQ) Regulation of Portland Manufacturing Operations The Company has entered into a Voluntary Cleanup Agreement with the Oregon Department of Environmental Quality (DEQ) in which the Company agreed to conduct an investigation of whether, and to what extent, past or present operations at the Portland property may have released hazardous substances into the environment. The Company has also signed an Order on Consent with the DEQ to finalize the investigation of potential onsite sources of contamination that may have a release pathway to the Willamette River. Interim precautionary measures are also required in the order and the Company is discussing with the DEQ potential remedial actions which may be required. The Company’s aggregate expenditure has not been material, however the Company could incur significant expenses for remediation. Some or all of any such outlay may be recoverable from other responsible parties. Other Litigation, Commitments and Contingencies From time to time, Greenbrier is involved as a defendant in litigation in the ordinary course of business, the outcomes of which cannot be predicted with certainty. While the ultimate outcome of such legal proceedings cannot be determined at this time, the Company believes that the resolution of pending litigation will not have a material adverse effect on the Company’s Consolidated Financial Statements. As of November 30, 2018, the Company had outstanding letters of credit aggregating $72.4 million associated with performance guarantees, facility leases and workers compensation insurance. As of November 30, 2018, the Company had a $10.0 million note receivable from Amsted-Maxion Cruzeiro, its unconsolidated Brazilian castings and components manufacturer and a $19.5 million note receivable balance from Greenbrier-Maxion, its unconsolidated Brazilian railcar manufacturer. These note receivables are included on the Consolidated Balance Sheet in Accounts receivable, net. In the future, the Company may make loans to or provide guarantees for Amsted-Maxion Cruzeiro or Greenbrier-Maxion. |
Fair Value Measures
Fair Value Measures | 3 Months Ended |
Nov. 30, 2018 | |
Fair Value Measures | Note 17 – Fair Value Measures Certain assets and liabilities are reported at fair value on either a recurring or nonrecurring basis. Fair value, for this disclosure, is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, under a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows: Level 1 - observable inputs such as unadjusted quoted prices in active markets for identical instruments; Level 2 - inputs, other than the quoted market prices in active markets for similar instruments, which are observable, either directly or indirectly; and Level 3 - unobservable inputs for which there is little or no market data available, which require the reporting entity to develop its own assumptions. Assets and liabilities measured at fair value on a recurring basis as of November 30, 2018 were: (In thousands) Total Level 1 Level 2 (1) Level 3 Assets: Derivative financial instruments $ 899 $ — $ 899 $ — Nonqualified savings plan investments 26,992 26,992 — — Cash equivalents 126,886 126,886 — — $ 154,777 $ 153,878 $ 899 $ — Liabilities: Derivative financial instruments $ 2,798 $ — $ 2,798 $ — (1) Level 2 assets and liabilities include derivative financial instruments that are valued based on observable inputs. See Note 13 - Derivative Instruments for further discussion. Assets and liabilities measured at fair value on a recurring basis as of August 31, 2018 were: (In thousands) Total Level 1 Level 2 Level 3 Assets: Derivative financial instruments $ 1,557 $ — $ 1,557 $ — Nonqualified savings plan investments 26,299 26,299 — — Cash equivalents 126,430 126,430 — — $ 154,286 $ 152,729 $ 1,557 $ — Liabilities: Derivative financial instruments $ 1,566 $ — $ 1,566 $ — |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Nov. 30, 2018 | |
Related Party Transactions | Note 18 – Related Party Transactions In June 2017, the Company purchased a 40% interest in the common equity of an entity that buys and sells railcar assets that are leased to third parties. The railcars sold to this leasing warehouse are principally built by Greenbrier. The Company accounts for this leasing warehouse investment under the equity method of accounting. As of November 30, 2018, the carrying amount of the investment was $5.5 million which is classified in Investment in unconsolidated affiliates in the Consolidated Balance Sheet. Upon sale of railcars to this entity from Greenbrier, 60% of the related revenue and margin is recognized and 40% is deferred until the railcars are ultimately sold by the entity. During the three months ended November 30, 2018, the Company recognized $4 million in revenue associated with railcars sold out of the leasing warehouse. The Company also provides administrative and remarketing services to this entity and earns management fees for these services which were immaterial for the three months ended November 30, 2018. As of November 30, 2018, the Company had a $10.0 million note receivable from Amsted-Maxion Cruzeiro, its unconsolidated Brazilian castings and components manufacturer and a $19.5 million note receivable balance from Greenbrier-Maxion, its unconsolidated Brazilian railcar manufacturer. These note receivables are included on the Consolidated Balance Sheet in Accounts receivable, net. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Summary of Contract Balances | The opening and closing balances of the Company’s contract balances are as follows: (in thousands) Balance sheet classification September 1, November 30, $ Contract assets Inventories $ 7,228 $ 9,741 $ 2,513 Contract liabilities 1 Deferred revenue $ 41,250 $ 36,763 $ (4,487 ) 1 Contract liabilities balance includes deferred revenue within the scope of the new revenue standard. |
Summary of Estimated Revenue Related to Performance Obligations Wholly or Partially Unsatisfied | The following table outlines estimated revenue related to performance obligations wholly or partially unsatisfied, that the Company anticipates will be recognized in future periods. (in millions) November 30, Revenue type 1 Manufacturing – Railcar Sales $ 2,011.8 Manufacturing – Railcars intended for syndication 2 $ 647.3 Manufacturing – Marine $ 55.9 Services $ 138.7 1 Unsatisfied performance obligation related to Wheels, Repair & Parts revenue is not material 2 Not within the scope of the new revenue standard |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
GBW Railcar Services LLC | |
Preliminary Allocation of Purchase Price Based on Fair Value of Net Assets Acquired | The preliminary allocation of the purchase price based on the fair value of the net assets acquired was: (in thousands) Cash and cash equivalents $ 5,000 Accounts receivable, net 12,230 Inventories 18,106 Property, plant and equipment, net 16,748 Intangibles and other assets, net 9,200 Goodwill 7,863 Total assets acquired 69,147 Accounts payable and accrued liabilities 12,394 Total liabilities assumed 12,394 Net assets acquired $ 56,753 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Components of Inventories | The following table summarizes the Company’s inventory balance: (In thousands) November 30, August 31, Manufacturing supplies and raw materials $ 286,779 $ 278,726 Work-in-process 107,377 105,021 Finished goods 104,933 54,181 Excess and obsolete adjustment (6,516 ) (5,614 ) $ 492,573 $ 432,314 |
Intangibles and Other Assets,_2
Intangibles and Other Assets, net (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Identifiable Intangible and Other Assets | The following table summarizes the Company’s identifiable intangible and other assets balance: (In thousands) November 30, August 31, Intangible assets subject to amortization: Customer relationships $ 72,625 $ 72,521 Accumulated amortization (44,687 ) (43,576 ) Other intangibles 15,925 16,300 Accumulated amortization (7,167 ) (6,400 ) 36,696 38,845 Intangible assets not subject to amortization 4,970 5,115 Prepaid and other assets 20,018 18,935 Nonqualified savings plan investments 26,992 26,299 Revolving notes issuance costs, net 3,632 1,824 Assets held for sale 3,650 3,650 Total Intangible and other assets, net $ 95,958 $ 94,668 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Accounts Payable and Accrued Liabilities | (In thousands) November 30, August 31, Trade payables $ 224,059 $ 226,405 Other accrued liabilities 78,726 73,273 Accrued payroll and related liabilities 87,182 105,111 Accrued warranty 26,264 27,395 Income taxes payable 11,438 4,771 Other 10,635 12,902 $ 438,304 $ 449,857 |
Warranty Accruals (Tables)
Warranty Accruals (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Warranty Accrual Activity | Warranty accrual activity: Three Months Ended (In thousands) 2018 2017 Balance at beginning of period $ 27,395 $ 20,737 Charged to cost of revenue, net 1,441 1,953 Payments (2,184 ) (751 ) Currency translation effect (388 ) 13 Balance at end of period $ 26,264 $ 21,952 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Components of Accumulated Other Comprehensive Loss, Net of Tax | Accumulated other comprehensive loss, net of tax effect as appropriate, consisted of the following: (In thousands) Unrealized Foreign Other Accumulated Balance, August 31, 2018 $ (431 ) $ (21,506 ) $ (1,429 ) $ (23,366 ) Other comprehensive loss before reclassifications (2,302 ) (3,916 ) (230 ) (6,448 ) Amounts reclassified from Accumulated other comprehensive loss 469 — — 469 Balance, November 30, 2018 $ (2,264 ) $ (25,422 ) $ (1,659 ) $ (29,345 ) |
Amounts Reclassified out of Accumulated Other Comprehensive Loss | The amounts reclassified out of Accumulated other comprehensive loss into the Consolidated Statements of Income, with presentation location, were as follows: (In thousands) Three Months Ended Financial Statement Location 2018 2017 (Gain) loss on derivative financial instruments: Foreign exchange contracts $ 488 $ (511 ) Revenue and Cost of revenue Interest rate swap contracts 144 167 Interest and foreign exchange 632 (344 ) Total before tax (163 ) 16 Tax expense $ 469 $ (328 ) Net of tax |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Reconciliation of Shares Used in Computation of Basic and Diluted Earnings Per Common Share | The shares used in the computation of basic and diluted earnings per common share are reconciled as follows: (In thousands) Three Months Ended 2018 2017 Weighted average basic common shares outstanding (1) 32,640 29,332 Dilutive effect of 2018 Convertible notes (2) — 3,331 Dilutive effect of 2024 Convertible notes (3) — — Dilutive effect of restricted stock units (4) 453 33 Weighted average diluted common shares outstanding 33,093 32,696 (1) Restricted stock grants and restricted stock units that are considered participating securities, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position. (2) The dilutive effect of the 2018 Convertible notes was included for the three months ended November 30, 2017 as they were considered dilutive under the “if converted” method as further discussed below. The 2018 Convertible notes matured on April 1, 2018. (3) The dilutive effect of the 2024 Convertible notes was excluded for the three months ended November 30, 2018 and 2017 as the average stock price was less than the applicable conversion price and therefore was considered anti-dilutive. (4) Restricted stock units that are not considered participating securities and restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position. |
Approach to Calculate Diluted Earning per Share | Three Months Ended 2018 2017 Net earnings attributable to Greenbrier $ 17,956 $ 26,253 Add back: Interest and debt issuance costs on the 2018 Convertible notes, net of tax n/a 733 Earnings before interest and debt issuance costs on 2018 Convertible Notes n/a $ 26,986 Weighted average diluted common shares outstanding 33,093 32,696 Diluted earnings per share (1) $ 0.54 $ 0.83 (1) Diluted earnings per share was calculated as follows: Earnings before interest and debt issuance costs (net of tax) on convertible notes Weighted average diluted common shares outstanding |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Fair Values of Derivative Instruments | Fair Values of Derivative Instruments Asset Derivatives Liability Derivatives November 30, August 31, November 30, August 31, (In thousands) Balance sheet location Fair Fair Balance sheet location Fair Fair Derivatives designated as hedging instruments Foreign forward exchange contracts Accounts receivable, net $ 755 $ 700 Accounts payable and accrued liabilities $ 1,857 $ 1,211 Interest rate swap contracts Accounts receivable, net — 781 Accounts payable and accrued liabilities 790 1 $ 755 $ 1,481 $ 2,647 $ 1,212 Derivatives not designated as hedging instruments Foreign forward exchange contracts Accounts receivable, net $ 144 $ 76 Accounts payable and accrued liabilities $ 46 $ 354 Interest rate swap contracts Accounts receivable, net — — Accounts payable and accrued liabilities 105 — $ 144 $ 76 $ 151 $ 354 |
Effect of Derivative Instruments on the Statements of Income | The Effect of Derivative Instruments on the Statements of Income Derivatives in cash flow hedging relationships Location of gain (loss) recognized in income on derivatives Gain (loss) 2018 2017 Foreign forward exchange contract Interest and foreign exchange $ 380 $ 380 Interest rate swap contracts Interest and foreign exchange — (17 ) $ 380 $ 363 Derivatives in cash flow hedging relationships Gain (loss) Location of gain (loss) into income Gain (loss) Location of gain (loss) on Gain (loss) recognized on 2018 2017 2018 2017 2018 2017 Foreign forward exchange contracts $ 72 $ 730 Revenue $ (256 ) $ 710 Revenue $ 262 $ 56 Foreign forward exchange contracts (1,495 ) (354 ) Cost of revenue (232 ) (199 ) Cost of revenue 389 82 Interest rate swap contracts (1,773 ) 771 Interest and foreign exchange (144 ) (167 ) Interest and foreign exchange (47 ) — $ (3,196 ) $ 1,147 $ (632 ) $ 344 $ 604 $ 138 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Results of Operations | For the three months ended November 30, 2018: Revenue Earnings (loss) from operations (In thousands) External Intersegment Total External Intersegment Total Manufacturing $ 471,789 $ 6,201 $ 477,990 $ 36,855 $ 433 $ 37,288 Wheels, Repair & Parts 108,543 15,981 124,524 3,247 312 3,559 Leasing & Services 24,191 5,999 30,190 17,513 5,452 22,965 Eliminations — (28,181 ) (28,181 ) — (6,197 ) (6,197 ) Corporate — — — (21,161 ) — (21,161 ) $ 604,523 $ — $ 604,523 $ 36,454 $ — $ 36,454 For the three months ended November 30, 2017: Revenue Earnings (loss) from operations (In thousands) External Intersegment Total External Intersegment Total Manufacturing $ 451,485 $ 16,804 $ 468,289 $ 52,969 $ 4,186 $ 57,155 Wheels, Repair & Parts 78,011 7,732 85,743 2,418 748 3,166 Leasing & Services 30,039 1,605 31,644 28,190 1,372 29,562 Eliminations — (26,141 ) (26,141 ) — (6,306 ) (6,306 ) Corporate — — — (22,135 ) — (22,135 ) $ 559,535 $ — $ 559,535 $ 61,442 $ — $ 61,442 Total assets November 30, August 31, (In thousands) 2018 2018 Manufacturing $ 998,820 $ 1,020,757 Wheels, Repair & Parts 322,525 306,756 Leasing & Services 691,389 578,818 Unallocated 502,390 559,133 $ 2,515,124 $ 2,465,464 |
Reconciliation of Earnings from Operations to Earnings Before Income Tax and Earnings (Loss) from Unconsolidated Affiliates | Reconciliation of Earnings from operations to Earnings before income tax and earnings (loss) from unconsolidated affiliates: Three Months Ended (In thousands) 2018 2017 Earnings from operations $ 36,454 $ 61,442 Interest and foreign exchange 4,404 7,020 Earnings before income tax and earnings (loss) from unconsolidated affiliates $ 32,050 $ 54,422 |
Fair Value Measures (Tables)
Fair Value Measures (Tables) | 3 Months Ended |
Nov. 30, 2018 | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis as of November 30, 2018 were: (In thousands) Total Level 1 Level 2 (1) Level 3 Assets: Derivative financial instruments $ 899 $ — $ 899 $ — Nonqualified savings plan investments 26,992 26,992 — — Cash equivalents 126,886 126,886 — — $ 154,777 $ 153,878 $ 899 $ — Liabilities: Derivative financial instruments $ 2,798 $ — $ 2,798 $ — (1) Level 2 assets and liabilities include derivative financial instruments that are valued based on observable inputs. See Note 13 - Derivative Instruments for further discussion. Assets and liabilities measured at fair value on a recurring basis as of August 31, 2018 were: (In thousands) Total Level 1 Level 2 Level 3 Assets: Derivative financial instruments $ 1,557 $ — $ 1,557 $ — Nonqualified savings plan investments 26,299 26,299 — — Cash equivalents 126,430 126,430 — — $ 154,286 $ 152,729 $ 1,557 $ — Liabilities: Derivative financial instruments $ 1,566 $ — $ 1,566 $ — |
Interim Financial Statements -
Interim Financial Statements - Additional Information (Detail) - USD ($) | Sep. 01, 2018 | Nov. 30, 2018 | Nov. 30, 2018 | Jan. 31, 2019 |
Accounting Standards Update 2014-09 | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Increase to retained earnings | $ 5,500,000 | |||
Share Repurchase Program - 2013 | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Remaining authorized repurchase amount | $ 88,000,000 | $ 88,000,000 | ||
Stock repurchased during period, shares | 0 | |||
Stock repurchase program total cost of repurchased shares | $ 137,000,000 | |||
Repurchase of common stock, shares | 3,206,226 | |||
Subsequent Event | Share Repurchase Program - 2013 | ||||
Equity, Class of Treasury Stock [Line Items] | ||||
Remaining authorized repurchase amount | $ 100,000,000 |
Revenue Recognition - Additiona
Revenue Recognition - Additional information (Detail) $ in Millions | 3 Months Ended |
Nov. 30, 2018USD ($) | |
Revenue From Contract With Customers [Line Items] | |
Revenue recognized from contract with customers liability | $ 5.3 |
Railcar Sales | |
Revenue From Contract With Customers [Line Items] | |
Expected revenue recognized in the reminder of fiscal year | 1,100 |
Services | |
Revenue From Contract With Customers [Line Items] | |
Expected revenue recognized in the reminder of fiscal year | $ 138.7 |
Expected performance percentage | 60.00% |
Maximum | |
Revenue From Contract With Customers [Line Items] | |
Repair service period | 90 days |
Revenue Recognition - Summary o
Revenue Recognition - Summary of Contract Balances (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Sep. 01, 2018 | |
Contract with Customer Asset and Liability [Line Items] | ||
Change in contract assets | $ 2,513 | |
Change in contract liabilities | (4,487) | |
Contract assets | 9,741 | $ 7,228 |
Contract liabilities | $ 36,763 | $ 41,250 |
Revenue Recognition - Summary_2
Revenue Recognition - Summary of Estimated Revenue Related to Performance Obligations (Detail) $ in Millions | Nov. 30, 2018USD ($) |
Railcar Sales | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue type 1 | $ 1,100 |
Services | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue type 1 | 138.7 |
Manufacturing | Railcar Sales | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue type 1 | 2,011.8 |
Manufacturing | Railcars for Syndication | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue type 1 | 647.3 |
Manufacturing | Marine | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue type 1 | $ 55.9 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | Aug. 20, 2018 | |
Business Acquisition [Line Items] | |||
Net assets acquired | $ 56,800 | ||
Revenue | $ 604,523 | $ 559,535 | |
Earnings (loss) from operations | 36,454 | 61,442 | |
Wheels, Repair & Parts | |||
Business Acquisition [Line Items] | |||
Revenue | 108,543 | 78,011 | |
Earnings (loss) from operations | 3,247 | $ 2,418 | |
Repair Operations | Wheels, Repair & Parts | |||
Business Acquisition [Line Items] | |||
Revenue | 23,900 | ||
Earnings (loss) from operations | $ 1,400 |
Acquisitions - Preliminary Allo
Acquisitions - Preliminary Allocation of Purchase Price Based on Fair Value of Net Assets Acquired (Detail) - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 | Aug. 20, 2018 |
Business Acquisition [Line Items] | |||
Goodwill | $ 77,508 | $ 78,211 | |
Net assets acquired | $ 56,800 | ||
GBW Railcar Services LLC | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | 5,000 | ||
Accounts receivable, net | 12,230 | ||
Inventories | 18,106 | ||
Property, plant and equipment, net | 16,748 | ||
Intangibles and other assets, net | 9,200 | ||
Goodwill | 7,863 | ||
Total assets acquired | 69,147 | ||
Accounts payable and accrued liabilities | 12,394 | ||
Total liabilities assumed | 12,394 | ||
Net assets acquired | $ 56,753 |
Inventories - Components of Inv
Inventories - Components of Inventories (Detail) - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 |
Inventory [Line Items] | ||
Manufacturing supplies and raw materials | $ 286,779 | $ 278,726 |
Work-in-process | 107,377 | 105,021 |
Finished goods | 104,933 | 54,181 |
Excess and obsolete adjustment | (6,516) | (5,614) |
Inventories | $ 492,573 | $ 432,314 |
Intangibles and Other Assets,_3
Intangibles and Other Assets, Net - Identifiable Intangible and Other Assets (Detail) - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 |
Intangibles and Other Assets by Major Class [Line Items] | ||
Finite-Lived Intangible Assets, Net, Total | $ 36,696 | $ 38,845 |
Intangible assets not subject to amortization | 4,970 | 5,115 |
Prepaid and other assets | 20,018 | 18,935 |
Nonqualified savings plan investments | 26,992 | 26,299 |
Revolving notes issuance costs, net | 3,632 | 1,824 |
Assets held for sale | 3,650 | 3,650 |
Total Intangible and other assets, net | 95,958 | 94,668 |
Customer Relationships | ||
Intangibles and Other Assets by Major Class [Line Items] | ||
Finite lived intangible assets gross | 72,625 | 72,521 |
Accumulated amortization | (44,687) | (43,576) |
Other Intangible Assets | ||
Intangibles and Other Assets by Major Class [Line Items] | ||
Finite lived intangible assets gross | 15,925 | 16,300 |
Accumulated amortization | $ (7,167) | $ (6,400) |
Intangibles and Other Assets,_4
Intangibles and Other Assets, Net - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Schedule of Intangible Assets Disclosure [Line Items] | ||
Amortization expense | $ 1.9 | $ 1.4 |
Future amortization expense, 2019 | 5.8 | |
Future amortization expense, 2020 | 5.1 | |
Future amortization expense, 2021 | 5.1 | |
Future amortization expense, 2022 | 3.7 | |
Future amortization expense, 2023 | $ 3.5 |
Revolving Notes - Additional In
Revolving Notes - Additional Information (Detail) | 1 Months Ended | 3 Months Ended | |
Sep. 30, 2018 | Nov. 30, 2018USD ($)CreditFacilityFacility | Aug. 31, 2018USD ($) | |
LIBOR | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 1.50% | ||
Prime Rate | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 0.50% | ||
Senior Secured Credit Facilities, Consisting of 3 Components | |||
Line of Credit Facility [Line Items] | |||
Number of senior secured credit facilities | CreditFacility | 3 | ||
Line of credit facility maximum capacity | $ 689,000,000 | ||
Letter of credit facility outstanding amount | 72,400,000 | $ 72,200,000 | |
Revolving Line of Credit, 1st Component of Senior Secured Credit Facilities | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility maximum capacity | $ 600,000,000 | ||
Line of credit maturity date | 2023-09 | ||
Revolving Line of Credit, 1st Component of Senior Secured Credit Facilities | LIBOR | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 1.50% | ||
Revolving Line of Credit, 1st Component of Senior Secured Credit Facilities | Prime Rate | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 0.50% | ||
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility maximum capacity | $ 39,000,000 | ||
Letter of credit facility outstanding amount | $ 22,200,000 | $ 27,700,000 | |
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | Minimum | |||
Line of Credit Facility [Line Items] | |||
Line of credit maturity date | 2019-02 | ||
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | Maximum | |||
Line of Credit Facility [Line Items] | |||
Line of credit maturity date | 2020-09 | ||
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | WIBOR | Minimum | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 1.10% | ||
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | WIBOR | Maximum | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 1.30% | ||
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | EURIBOR | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 1.10% | ||
Mexican Railcar Manufacturing Joint Venture Line of Credit, 3rd Component of Senior Secured Credit Facilities | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility maximum capacity | $ 50,000,000 | ||
Number of lines of credits | Facility | 2 | ||
Mexican Railcar Manufacturing Joint Venture Line of Credit 1, 3rd Component of Senior Secured Credit Facilities | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility maximum capacity | $ 30,000,000 | ||
Line of credit facility borrowings outstanding due period | 2019-01 | ||
Mexican Railcar Manufacturing Joint Venture Line of Credit 1, 3rd Component of Senior Secured Credit Facilities | LIBOR | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 2.00% | ||
Mexican Railcar Manufacturing Joint Venture Line of Credit 2, 3rd Component of Senior Secured Credit Facilities | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility maximum capacity | $ 20,000,000 | ||
Line of credit facility borrowings outstanding due period | 2019-07 | ||
Joint venture partner each guaranteed percentage | 50.00% | ||
Mexican Railcar Manufacturing Joint Venture Line of Credit 2, 3rd Component of Senior Secured Credit Facilities | LIBOR | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, percentage points added to the reference rate | 2.00% |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities - Accounts Payable and Accrued Liabilities (Detail) - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 | Nov. 30, 2017 | Aug. 31, 2017 |
Accounts Payable and Accrued Liabilities [Line Items] | ||||
Trade payables | $ 224,059 | $ 226,405 | ||
Other accrued liabilities | 78,726 | 73,273 | ||
Accrued payroll and related liabilities | 87,182 | 105,111 | ||
Accrued warranty | 26,264 | 27,395 | $ 21,952 | $ 20,737 |
Income taxes payable | 11,438 | 4,771 | ||
Other | 10,635 | 12,902 | ||
Accounts payable and accrued liabilities | $ 438,304 | $ 449,857 |
Warranty Accruals - Warranty Ac
Warranty Accruals - Warranty Accruals Activity (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Product Liability Contingency [Line Items] | ||
Balance at beginning of period | $ 27,395 | $ 20,737 |
Charged to cost of revenue, net | 1,441 | 1,953 |
Payments | (2,184) | (751) |
Currency translation effect | (388) | 13 |
Balance at end of period | $ 26,264 | $ 21,952 |
Notes Payable - Additional Info
Notes Payable - Additional Information (Detail) $ in Thousands | 1 Months Ended |
Sep. 30, 2018USD ($) | |
Debt Instrument [Line Items] | |
Periodic payment | $ 1,970 |
Swap agreement interest rate | 50.00% |
Fixed interest rate | 2.99% |
Senior Term Debt | |
Debt Instrument [Line Items] | |
Senior term debt | $ 170,000 |
5 Year Senior Term Debt | |
Debt Instrument [Line Items] | |
Senior term debt | $ 225,000 |
LIBOR | |
Debt Instrument [Line Items] | |
Debt instrument, percentage points added to the reference rate | 1.50% |
Prime Rate | |
Debt Instrument [Line Items] | |
Debt instrument, percentage points added to the reference rate | 0.50% |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Loss, Net of Tax (Detail) $ in Thousands | 3 Months Ended |
Nov. 30, 2018USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | $ 1,250,101 |
Other comprehensive loss before reclassifications | (6,448) |
Amounts reclassified from Accumulated other comprehensive loss | 469 |
Ending balance | 1,257,631 |
Unrealized (Gain) Loss on Derivative Financial Instruments | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | (431) |
Other comprehensive loss before reclassifications | (2,302) |
Amounts reclassified from Accumulated other comprehensive loss | 469 |
Ending balance | (2,264) |
Foreign Currency Translation Adjustment | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | (21,506) |
Other comprehensive loss before reclassifications | (3,916) |
Ending balance | (25,422) |
Other | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | (1,429) |
Other comprehensive loss before reclassifications | (230) |
Ending balance | (1,659) |
Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Beginning balance | (23,366) |
Ending balance | $ (29,345) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - Amounts Reclassified out of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Interest and foreign exchange | $ 4,404 | $ 7,020 |
Total before tax | (32,050) | (54,422) |
Tax expense | 9,135 | 18,135 |
Unrealized (Gain) Loss on Derivative Financial Instruments | Reclassification out of Accumulated Other Comprehensive loss | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Total before tax | 632 | (344) |
Tax expense | (163) | 16 |
Net of tax | 469 | (328) |
Unrealized (Gain) Loss on Derivative Financial Instruments | Reclassification out of Accumulated Other Comprehensive loss | Foreign Exchange Contracts | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Revenue and Cost of revenue | 488 | (511) |
Unrealized (Gain) Loss on Derivative Financial Instruments | Reclassification out of Accumulated Other Comprehensive loss | Interest rate swap contracts | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | ||
Interest and foreign exchange | $ 144 | $ 167 |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation of Shares Used in Computation of Basic and Diluted Earnings Per Common Share (Detail) - shares shares in Thousands | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | ||
Earnings Per Share Disclosure [Line Items] | |||
Weighted average basic common shares outstanding | [1] | 32,640 | 29,332 |
Dilutive effect of restricted stock units | [2] | 453 | 33 |
Weighted average diluted common shares outstanding | 33,093 | 32,696 | |
2018 Senior Notes | |||
Earnings Per Share Disclosure [Line Items] | |||
Dilutive effect of convertible notes | [3] | 3,331 | |
[1] | Restricted stock grants and restricted stock units that are considered participating securities, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position. | ||
[2] | Restricted stock units that are not considered participating securities and restricted stock units subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position. | ||
[3] | The dilutive effect of the 2018 Convertible notes was included for the three months ended November 30, 2017 as they were considered dilutive under the "if converted" method as further discussed below. The 2018 Convertible notes matured on April 1, 2018. |
Earnings Per Share - Approach t
Earnings Per Share - Approach to Calculate Diluted Earning Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | ||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Net earnings attributable to Greenbrier | $ 17,956 | $ 26,253 | |
Weighted average diluted common shares outstanding | 33,093 | 32,696 | |
Diluted earnings per share | [1] | $ 0.54 | $ 0.83 |
2018 Senior Notes | |||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Interest and debt issuance costs on the 2018 Convertible notes, net of tax | $ 733 | ||
Earnings before interest and debt issuance costs on 2018 Convertible Notes | $ 26,986 | ||
[1] | Diluted earnings per share was calculated as follows: Earnings before interest and debt issuance costs (net of tax) on convertible notes Weighted average diluted common shares outstanding |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Share Based Compensation Arrangements By Share Based Payment Award Options [Line Items] | ||
Stock based compensation expense | $ 3,194 | $ 5,939 |
Derivative Instruments - Additi
Derivative Instruments - Additional Information (Detail) | 3 Months Ended |
Nov. 30, 2018USD ($) | |
Foreign Exchange Contracts | |
Derivative [Line Items] | |
Aggregate derivative notional amount | $ 139,800,000 |
Amount reclassified to revenue or cost of revenue in the next year | 2,400,000 |
Interest rate swap contracts | |
Derivative [Line Items] | |
Aggregate derivative notional amount | $ 112,500,000 |
Maturity date | 2023-09 |
Unrealized pre-tax gain (loss) that would be reclassified to interest expense in the next year | $ 800,000 |
Derivative Instruments - Fair V
Derivative Instruments - Fair Values of Derivative Instruments (Detail) - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 |
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | $ 899 | $ 1,557 |
Liability Derivatives | 2,798 | 1,566 |
Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 755 | 1,481 |
Liability Derivatives | 2,647 | 1,212 |
Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Receivable | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 755 | 700 |
Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Payable and Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Liability Derivatives | 1,857 | 1,211 |
Designated as Hedging Instrument | Interest rate swap contracts | Accounts Receivable | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 781 | |
Designated as Hedging Instrument | Interest rate swap contracts | Accounts Payable and Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Liability Derivatives | 790 | 1 |
Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 144 | 76 |
Liability Derivatives | 151 | 354 |
Not Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Receivable | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives | 144 | 76 |
Not Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Payable and Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Liability Derivatives | 46 | $ 354 |
Not Designated as Hedging Instrument | Interest rate swap contracts | Accounts Payable and Accrued Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Liability Derivatives | $ 105 |
Derivative Instruments - Effect
Derivative Instruments - Effect of Derivative Instruments on Statements of Income (Detail) - Cash Flow Hedging - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in income on derivatives | $ 380 | $ 363 |
Gain (loss) recognized in OCI on derivatives (effective portion) | (3,196) | 1,147 |
Gain (loss) reclassified accumulated OCI income (effective portion) | (632) | 344 |
Gain (loss) recognized on derivative (ineffective portion and amount excluded from effectiveness testing) | 604 | 138 |
Foreign Exchange Forward | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in OCI on derivatives (effective portion) | 72 | 730 |
Foreign Exchange Forward | Interest and Foreign Exchange | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in income on derivatives | 380 | 380 |
Foreign Exchange Forward | Sales | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) reclassified accumulated OCI income (effective portion) | 256 | 710 |
Gain (loss) recognized on derivative (ineffective portion and amount excluded from effectiveness testing) | 262 | 56 |
Foreign Exchange Forward | Cost Of Revenue | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in OCI on derivatives (effective portion) | (1,495) | (354) |
Gain (loss) reclassified accumulated OCI income (effective portion) | (232) | (199) |
Gain (loss) recognized on derivative (ineffective portion and amount excluded from effectiveness testing) | 389 | 82 |
Interest rate swap contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in OCI on derivatives (effective portion) | (1,773) | 771 |
Interest rate swap contracts | Interest and Foreign Exchange | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in income on derivatives | (17) | |
Gain (loss) reclassified accumulated OCI income (effective portion) | (144) | $ (167) |
Gain (loss) recognized on derivative (ineffective portion and amount excluded from effectiveness testing) | $ (47) |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | Aug. 20, 2018SegmentFacility | Aug. 19, 2018Segment |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | Segment | 3 | 4 |
Number of railcars repair shops returned to business | Facility | 12 |
Segment Information - Segments
Segment Information - Segments Internal Financial Reports (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2018 | Nov. 30, 2017 | Aug. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 604,523 | $ 559,535 | |
Earnings (loss) from operations | 36,454 | 61,442 | |
Assets | 2,515,124 | $ 2,465,464 | |
Manufacturing | |||
Segment Reporting Information [Line Items] | |||
Revenues | 471,789 | 451,485 | |
Earnings (loss) from operations | 36,855 | 52,969 | |
Wheels, Repair & Parts | |||
Segment Reporting Information [Line Items] | |||
Revenues | 108,543 | 78,011 | |
Earnings (loss) from operations | 3,247 | 2,418 | |
Leasing & Services | |||
Segment Reporting Information [Line Items] | |||
Revenues | 24,191 | 30,039 | |
Earnings (loss) from operations | 17,513 | 28,190 | |
Operating Segments | Manufacturing | |||
Segment Reporting Information [Line Items] | |||
Revenues | 477,990 | 468,289 | |
Earnings (loss) from operations | 37,288 | 57,155 | |
Assets | 998,820 | 1,020,757 | |
Operating Segments | Wheels, Repair & Parts | |||
Segment Reporting Information [Line Items] | |||
Revenues | 124,524 | 85,743 | |
Earnings (loss) from operations | 3,559 | 3,166 | |
Assets | 322,525 | 306,756 | |
Operating Segments | Leasing & Services | |||
Segment Reporting Information [Line Items] | |||
Revenues | 30,190 | 31,644 | |
Earnings (loss) from operations | 22,965 | 29,562 | |
Assets | 691,389 | 578,818 | |
Operating Segments | Unallocated Amount to Segment | |||
Segment Reporting Information [Line Items] | |||
Assets | 502,390 | $ 559,133 | |
Intersegment Eliminations | |||
Segment Reporting Information [Line Items] | |||
Revenues | (28,181) | (26,141) | |
Earnings (loss) from operations | (6,197) | (6,306) | |
Intersegment Eliminations | Manufacturing | |||
Segment Reporting Information [Line Items] | |||
Revenues | (6,201) | (16,804) | |
Earnings (loss) from operations | (433) | (4,186) | |
Intersegment Eliminations | Wheels, Repair & Parts | |||
Segment Reporting Information [Line Items] | |||
Revenues | (15,981) | (7,732) | |
Earnings (loss) from operations | (312) | (748) | |
Intersegment Eliminations | Leasing & Services | |||
Segment Reporting Information [Line Items] | |||
Revenues | (5,999) | (1,605) | |
Earnings (loss) from operations | (5,452) | (1,372) | |
Corporate, Non-Segment | |||
Segment Reporting Information [Line Items] | |||
Earnings (loss) from operations | $ (21,161) | $ (22,135) |
Segment Information - Reconcili
Segment Information - Reconciliation of Earnings from Operations to Earnings Before Income Tax and Earnings (Loss) from Unconsolidated Affiliates (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2018 | Nov. 30, 2017 | |
Segment Reporting, Other Significant Reconciling Item [Line Items] | ||
Earnings from operations | $ 36,454 | $ 61,442 |
Interest and foreign exchange | 4,404 | 7,020 |
Earnings before income tax and earnings (loss) from unconsolidated affiliates | $ 32,050 | $ 54,422 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Jan. 06, 2017USD ($)Segment | Dec. 31, 2016USD ($) | Nov. 30, 2018USD ($) |
Commitments and Contingencies Disclosure [Line Items] | |||
Remedial investigation and feasibility study | $ 110,000,000 | ||
Performance Guarantee | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Letter of credit facility outstanding amount | $ 72,400,000 | ||
Portland Harbor Site | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Number of sediment decision units | Segment | 13 | ||
Estimated undiscounted cost | $ 1,700,000,000 | ||
Period for remedial action | 13 years | ||
Period for monitoring | 30 years | ||
New data collection period to reflect actual cost prior to final remedy design | 2 years | ||
Portland Harbor Site | Minimum | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Accuracy of cost estimate | (30.00%) | ||
Portland Harbor Site | Maximum | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Accuracy of cost estimate | 50.00% | ||
Amsted-Maxion Cruzeiro | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Note receivable | 10,000,000 | ||
Greenbrier-Maxion | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Note receivable | $ 19,500,000 |
Fair Value Measures - Assets an
Fair Value Measures - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Nov. 30, 2018 | Aug. 31, 2018 |
Assets: | ||
Derivative financial instruments | $ 899 | $ 1,557 |
Nonqualified savings plan investments | 26,992 | 26,299 |
Cash equivalents | 126,886 | 126,430 |
Assets, Fair Value Disclosure, Total | 154,777 | 154,286 |
Liabilities: | ||
Derivative financial instruments | 2,798 | 1,566 |
Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | ||
Assets: | ||
Nonqualified savings plan investments | 26,992 | 26,299 |
Cash equivalents | 126,886 | 126,430 |
Assets, Fair Value Disclosure, Total | 153,878 | 152,729 |
Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | ||
Assets: | ||
Derivative financial instruments | 899 | 1,557 |
Assets, Fair Value Disclosure, Total | 899 | 1,557 |
Liabilities: | ||
Derivative financial instruments | $ 2,798 | $ 1,566 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2018 | Jun. 30, 2017 | |
Related Party Transaction [Line Items] | ||
Carrying amount of investment in unconsolidated affiliates | $ 5.5 | |
Percentage of recognized revenue and margin from sale | 60.00% | |
Percentage of deferred revenue and margin from sale | 40.00% | |
Revenue recognize from railcars sold | $ 4 | |
Leasing Warehouse | ||
Related Party Transaction [Line Items] | ||
Revenue recognize from railcars sold | 0 | |
Greenbrier | ||
Related Party Transaction [Line Items] | ||
Percentage of ownership in entity | 40.00% | |
Amsted-Maxion Cruzeiro | ||
Related Party Transaction [Line Items] | ||
Note receivable | 10 | |
Greenbrier-Maxion | ||
Related Party Transaction [Line Items] | ||
Note receivable | $ 19.5 |