NYSE$TRN

Trinity Industries Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Trinity's Q2 2023 earnings were announced, showcasing significant year-over-year improvements in revenue, EPS, and operational efficiency.

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.

Headline financials

Total Revenue

$722M

Previous: $417M+73.3%
EPS (adj)

$0.23

Previous: $0.14+64.3%
Fleet Utilization

97.9%

Previous: 97.2%+0.7%
Railcar Deliveries

5.0K

Previous: 2.5K+98.6%
New Railcar Orders

4.8K

Previous: 4.3K+10.0%
Capital Expenditures

-$20.8M

Previous: -$18.8M-10.6%
Free Cash Flow

-$3.8M

Previous: -$15.1M+74.8%
Net Income

$17M

Previous: $3.7M+359.5%
Operating Income

$99.1M

Previous: $73M+35.8%
Gross Profit

$121M

Previous: $91.2M+32.9%
Cash & Equivalents

$91.7M

Previous: $49.7M+84.5%
Total Assets

$9.02B

Previous: $8.62B+4.6%
Stock-Based Comp

$6.5M

Previous: $5.7M+14.0%

Revenue & EPS history

Trinity · Revenue · Quarterly

$722M

Q2 2023+73.3%vs Q2 2022
Beat estimate in 8 of 14 quarters(57%)
ActualEstimate

Revenue by segment

Trinity · $932M total across 2 segments · Q2 2023

  • Rail Products
    $709M+64.7%
  • Railcar Leasing and Services
    $223M+14.3%

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.

Tailwinds

  • 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.

Headwinds

  • 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

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

-0.6%

Avg return

Earnings day

-1.6%

Avg return

5 days after

-0.2%

Avg return

30 days after

46%

31 / 67 earnings

Positive

+19.1%

Q2 2012

Best reaction

-25.4%

Q4 2015

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+6.0%+16.6%+5.2%
Q3 2025-2.7%-6.2%-4.7%
Q1 2025-2.9%-1.9%+2.5%
Q4 2024-8.3%-10.0%-14.1%
Q3 2024-8.8%-5.4%+5.5%
Q2 2024+2.8%+1.5%-0.2%
Q1 2024+15.5%+17.3%+20.9%
Q4 2023-7.3%-7.4%-0.5%
Q3 2023+15.9%+13.7%+23.8%
Q2 2023+2.5%-1.9%-4.4%
Q1 2023-8.7%-9.7%-9.9%
Q4 2022-9.6%-5.5%-19.4%
Q3 2022+7.4%+20.1%+30.1%
Q2 2022+6.0%+7.7%+7.3%
Q1 2022-7.0%-11.1%-18.4%
Q4 2021-5.8%-5.5%+9.7%
Q3 2021+0.5%-2.1%-6.0%
Q2 2021-0.8%+0.0%+5.9%
Q1 2021-2.9%-1.8%-0.5%
Q4 2020-2.8%+2.2%-10.2%
Q3 2020-5.7%-7.3%+0.8%
Q2 2020-7.7%-8.5%-4.9%
Q1 2020+10.4%+4.1%+14.3%
Q4 2019+5.7%-1.0%-26.6%
Q3 2019+1.1%+6.2%+15.0%
Q2 2019-9.1%-5.9%-19.2%
Q1 2019-11.5%-9.5%-13.9%
Q4 2018-2.3%-6.6%-18.1%
Q3 2018-18.3%-23.3%-13.8%
Q2 2018+1.6%+2.1%-0.1%
Q1 2018-0.1%+0.4%+11.0%
Q4 2017-1.4%-6.1%-9.9%
Q3 2017-8.2%-7.8%-1.0%
Q2 2017-3.4%-1.8%+2.9%
Q1 2017+3.0%+0.5%-2.6%
Q4 2016+1.2%-3.8%-4.0%
Q3 2016-2.4%-4.8%+22.0%
Q2 2016+4.2%+1.0%+17.0%
Q1 2016+4.0%
Q4 2015-25.4%
Q3 2015+4.6%
Q2 2015+4.6%
Q1 2015-12.5%
Q4 2014+6.8%
Q3 2014-2.1%
Q2 2014+1.5%
Q1 2014+4.8%
Q4 2013+10.4%
Q3 2013+7.3%
Q2 2013+6.2%
Q1 2013-3.3%
Q4 2012-3.6%
Q3 2012-3.9%
Q2 2012+19.1%
Q1 2012+1.6%
Q4 2011+5.1%
Q4 2010+4.2%
Q3 2011+4.2%
Q2 2011-13.8%
Q1 2010-4.1%
Q1 2011+6.6%
Q4 2008+2.6%
Q3 2009-3.2%
Q3 2010-3.2%
Q2 2010-1.7%
Q4 2009-1.7%
Q2 2009-1.7%

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