GATX Corporation Reports 2004 Third Quarter Results.CHICAGO Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. -- GATX GATX General American Transportation Corporation Corporation (NYSE NYSE See: New York Stock Exchange :GMT (Greenwich Mean Time) See UTC. GMT - Universal Time 1 ) today announced its 2004 third quarter results. Per share results for the third quarter and nine months ending September September: see month. 30 are summarized below:
Three Months Ended Nine Months Ended
September 30 September 30
------------------- -------------------
Per Diluted Share 2004 2003 2004 2003
----------------- --------- --------- --------- ---------
Income from Continuing
Operations $.92 $.43 $1.72 $.80
Income from Discontinued
Operations (.14) .03 .20 .20
--------- --------- --------- ---------
Total $.78 $.46 $1.92 $1.00
========= ========= ========= =========
The 2004 third quarter income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the includes $.53 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share of income from an insurance recovery on previously expensed litigation-related charges. The 2003 third quarter income from continuing operations includes $.13 per diluted share of income from an insurance recovery on the same litigation-related charges. Income from continuing operations for the nine-month period ended September 30, 2004 includes $.57 per diluted share of income from insurance recoveries. Income from continuing operations for the first nine months of 2003 includes income of $.20 per diluted share related to insurance recoveries as well as air impairments and charges totaling $.14 per diluted share. In the second quarter of 2004, GATX completed the sale of substantially all of its technology leasing assets. Therefore, the technology leasing segment is reported as a discontinued operation discontinued operation A segment of a business that has been abandoned or sold or for which plans for one or another of these actions have been approved. See also continuing operations. and prior periods have been restated to conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" the current presentation. Core markets showed continued improvement in the third quarter of 2004: --North American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of fleet utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be at GATX Rail increased to 97%, up from 96% in the previous quarter. GATX Rail added 1,000 cars to the fleet during the third quarter through new car additions and portfolio acquisitions. Lease renewal rates on many car types showed continued improvement over rates on expiring ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. leases. --GATX Air reached 100% utilization on its owned fleet. All aircraft scheduled for lease renewal and all new aircraft deliveries in 2004 have been placed. --Investment volume in continuing operations totaled $148 million in the 2004 third quarter and $517 million year to date, compared to $82 million and $439 million, respectively, in the prior year periods. Investment in 2004 has been primarily in the rail segment, as GATX Rail has been taking delivery of new cars and successfully pursuing secondary market railcar acquisitions. --Overall credit quality has continued to improve. There were recoveries of previously reserved transactions and charge-offs remained at low levels compared to recent years. Ronald H. Zech, chairman and chief executive officer of GATX, stated, "Our third quarter results reflect the ongoing recovery in our core markets. The improving rail market, as shown in industry data such as increased rail traffic and new car order backlogs, is positively affecting our business. Our North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. fleet utilization and active car counts continued to increase, and the improving lease (Scots Law) an extended lease to induce the tenant to make improvements on the premises. See also: Improving rate environment is spreading to a larger number of car types. As we have mentioned in the past, these positive developments will take time to work through to our bottom line, due to the gradual The Gradual (Latin: graduale, sometimes called the Grail) is a chant in the extraordinary form of the Roman Catholic Mass, sung after the reading or singing of the Epistle and before the Alleluia, or, during penitential seasons, before the Tract. rollover A graphic element in an application or on a Web page that changes its color or shape when the pointer is moved (rolled) over it. See JavaScript rollover. See also n-key rollover. of the fleet and higher maintenance costs associated with increased fleet activity. However, the improving market trends of recent quarters continue. "In our Air business, lease rates are improving, particularly on the newer, narrowbody aircraft Noun 1. narrowbody aircraft - a commercial airliner with a single aisle narrow-body, narrow-body aircraft airliner - a commercial airplane that carries passengers , as there is better relative demand for these assets. However, the air industry remains under pressure, particularly with extremely high jet fuel prices and the onset on·set n. A beginning; a start, as of a cold. of the slower winter travel season presenting serious challenges for carriers and increasing the potential for credit losses and asset impairments in the air portfolio. "The positive performance of our Specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. business continues to be driven by a combination of a stronger overall credit environment, fee income from asset management activities, remarketing opportunities on owned assets, and strong performance at certain joint ventures, particularly in the marine sector." Mr. Zech concluded, "Based on results year to date, and considering conditions in our core markets, we now expect that 2004 income from continuing operations will be in the range of $2.20 per diluted share. As we mentioned last quarter, our 2004 expectation for income from continuing operations includes approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $.90 per diluted share of income from non-operating events in 2004, $.57 per diluted share of which has already occurred through insurance recoveries." This outlook could potentially be affected by items such as: the impact from the possible sale of GATX-owned property in Staten Island Staten Island (1990 pop. 378,977), 59 sq mi (160 sq km), SE N.Y., in New York Bay, SW of Manhattan, forming Richmond co. of New York state and the borough of Staten Island of New York City. ; air-related impairments or charges; and the dilutive effect Dilutive effect Result of a transaction that decreases earnings per common share (EPS). on earnings per share resulting from the implementation of the fourth quarter accounting rule change related to contingent Fortuitous; dependent upon the possible occurrence of a future event, the existence of which is not assured. The word contingent denotes that there is no present interest or right but only a conditional one which will become effective upon the happening of the convertible securities. GATX RAIL GATX Rail reported net income of $13.2 million in the 2004 third quarter compared to $15.2 million in the prior year period, lower primarily due to higher maintenance expense. For the nine-month period, 2004 net income was $44.6 million compared to $41.0 million in the prior year. GATX Rail's North American fleet totaled 107,000 cars and utilization of this fleet was 97% at the end of the third quarter, up from 96% at the end of the second quarter and 93% at the end of 2003. The increase in utilization primarily reflects the addition of active cars to the fleet through new deliveries and fleet acquisitions, moving cars from idle to active service, and continued car scrapping. GATX Rail added nearly 4,800 cars to its fleet year to date, through new car and secondary market acquisitions, compared to 806 cars during the same period in 2003, reflecting increasingly attractive investment opportunities. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. investment volume at GATX Rail reached $330 million versus $123 million in the prior year. Maintenance expenses in 2004 remain higher than 2003 levels, due to a number of factors including costs associated with removing cars from idle inventory and preparing them for active service, and more costly types of repairs performed in 2004 versus 2003. Order backlogs at railcar manufacturers, an indicator Indicator Anything used to predict future financial or economic trends. Notes: In the context of technical analysis, an indicator is a mathematical calculation based on a securities price and/or volume. The result is used to predict future prices. of future demand for new railcars, continued to climb and surpassed 60,000 cars for the first time since early 1999. North American manufacturing capacity utilization Capacity Utilization measures the rate at which a firm makes use of their capital productive capacities, such as factories and machinery. Capacity Utilization generally rises when the economy is healthy and falls when demand softens. , as reported by the Federal Reserve, was 77%, flat with the prior quarter but up from 75% in the prior year period. Rail carloadings, excluding intermodal in·ter·mod·al adj. Relating to transportation by more than one means of conveyance, as by truck and rail: intermodal transport. , are up 3% year over year and industry-wide chemical shipments have increased 5% in the first nine months of 2004 versus the prior year period. GATX AIR GATX Air reported third quarter net income of $5.0 million compared to net income of $3.4 million in the prior year period. For the nine-month period, 2004 net income was $9.6 million compared to $1.0 million in the prior year period. The 2003 nine-month results include an aggregate negative effect of $5.9 million after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. related to the net write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. and sale of an Air Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of unsecured Unsecured A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge. note. Third quarter results benefited from the sale of three aircraft from the owned portfolio and strong income from our engine leasing joint venture with Rolls-Royce Rolls-Royce is a British brand, it may refer to:
Utilization was at 100% and lease rates on certain aircraft types have shown signs of a gradual recovery. All three 2004 scheduled new deliveries have been placed with customers. In addition, all of GATX Air's original schedule of 15 aircraft renewals in 2004 have been renewed re·new v. re·newed, re·new·ing, re·news v.tr. 1. To make new or as if new again; restore: renewed the antique chair. 2. or assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. to new customers. While traffic patterns improved during the summer season, carrier performance remains weak and will be closely monitored for the impact of high jet fuel prices and the more challenging winter season. Regarding the air sector, an updated slide presentation outlining portfolio data is available at www.gatx.com. GATX SPECIALTY FINANCE GATX Specialty Finance reported net income of $6.4 million in the 2004 third quarter compared to $9.0 million in the prior year period. For the nine-month period, 2004 net income was $31.4 million compared to $26.7 million in the prior year period. The 2004 results have been driven by an improved credit environment, lower impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges, and higher remarketing income compared to the prior year periods. The Specialty portfolio currently consists of $510 million of owned assets and a third-party managed portfolio totaling $778 million. The venture assets continue to run off as planned, with approximately $60 million of assets remaining at the end of the third quarter. Following the run-off run-off n (in contest, election) → desempate m (= extra race); carrera de desempate run-off n (in contest, election) → of the venture assets, which should be completed by mid- mid- pref. Middle: midbrain. 2005, the pace of asset decline in the Specialty portfolio is expected to slow. GATX is selectively pursuing new investments in Specialty, particularly in the marine area. DISCONTINUED OPERATIONS Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. In the second quarter 2004, GATX completed the sale of substantially all of its technology leasing assets. The technology leasing segment is accounted for as a discontinued operation. In the third quarter 2004, GATX recorded sale-related expenses of $7.5 million after-tax primarily related to lease termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. costs and severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when . CREDIT STATISTICS Credit statistics from prior periods have been restated to exclude GATX's technology segment, due to the reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. of this segment as a discontinued operation. Recoveries in the 2004 third quarter exceeded charge-offs and impairments. Net charge-offs and impairments in the 2003 third quarter totaled $7.2 million, or 0.4% of average total assets on an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis. Non-performing leases and loans at the end of the 2004 third quarter totaled $58.6 million compared to $135.1 million in the prior year period and $76.1 million at the end of 2003. The decline in non-performing leases and loans primarily reflects improvements in overall portfolio quality in the third quarter. COMPANY DESCRIPTION GATX Corporation (NYSE: GMT) is a specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. finance and leasing company combining asset knowledge and services, structuring expertise, partnering, and capital to provide business solutions to customers and partners worldwide. GATX specializes in railcar, locomotive locomotive, vehicle used to pull a train of unpowered railroad cars. Types of Locomotives The steam-powered locomotive played a key role during the development and golden age of railroading, but, despite its long and picturesque history, it has , and aircraft operating leasing. TELECONFERENCE INFORMATION GATX Corporation will host a teleconference to discuss 2004 third quarter results. Teleconference details are as follows:
Thursday, October 28th
11:00 AM Eastern Time
Domestic Dial-In: 1-800-706-6082
International Dial-In: 1-706-634-7421
Replay: 1-800-642-1687 / Access Code: 1430116
Call in details and real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. audio access are available at www.gatx.com. Please access the call 15 minutes prior to the start time. Following the call, a replay will be available on the same site. UPDATE ON AIR PORTFOLIO GATX Corporation has updated its Air portfolio presentation, and the slides are currently available at www.gatx.com or by calling the GATX Investor Relations Investor relations The process by which the corporation communicates with its investors. Department. FORWARD-LOOKING STATEMENTS forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Certain statements within this document may constitute forward-looking statements made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provision of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements are identified by words such as "anticipate," "believe," "estimate," "expect," "intend," "predict," or "project" and similar expressions. This information may involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Risks and uncertainties include, but are not limited to, general economic conditions; aircraft and railcar lease rate and utilization levels; conditions in the capital markets and the potential for a downgrade Downgrade A negative change in the rating of a security. Notes: For example, an analyst may downgrade a stock from strong buy to buy, or a bond rating agency may downgrade a bond from AAA to AA. in GATX's or GATX Financial Corp.'s credit rating, either of which could have an effect on the Company's borrowing costs or ability to access the markets for commercial paper or secured and unsecured debt Unsecured debt Debt that does not identify specific assets that the debtholder is entitled to in case of default. ; dynamics affecting customers within the chemical, petroleum and food industries; regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. rulings that may impact the economic value of assets; competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. in the rail and air markets who may have access to capital at lower costs than GATX; additional potential write-downs and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. provisions within GATX's portfolio; impaired asset Impaired Asset An asset with a market value that is worth less than its book value. Notes: If the sum of all estimated future cash flows is less than the carrying value of the asset, then the asset would be considered impaired and would have to be written down to its fair charges; and general market conditions in the rail, air, technology, venture, and other large-ticket industries. Investor, corporate, financial, historical financial, photographic and news release information may be found at www.gatx.com.
-- Tabular Follows--
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In Millions, Except Per Share Data)
Three Months Ended Nine Months Ended
September 30 September 30
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Gross Income
Lease income $200.2 $193.0 $583.9 $577.2
Marine operating revenue 36.2 27.3 76.2 57.0
Interest income 2.9 9.0 15.3 30.6
Asset remarketing income 5.1 6.5 32.2 23.9
Gain on sale of securities .2 5.8 3.4 6.3
Fees 5.7 3.7 13.9 14.2
Other 59.9 30.6 96.4 66.1
--------- --------- --------- ---------
Revenues 310.2 275.9 821.3 775.3
Share of affiliates' earnings 17.2 16.7 51.2 55.6
--------- --------- --------- ---------
Total Gross Income 327.4 292.6 872.5 830.9
Ownership Costs
Depreciation 48.8 46.9 142.2 139.6
Interest, net 41.5 42.2 119.9 134.6
Operating lease expense 45.0 45.1 135.8 137.3
--------- --------- --------- ---------
Total Ownership Costs 135.3 134.2 397.9 411.5
Other Costs and Expenses
Maintenance expense 46.3 43.3 140.4 125.3
Marine operating expenses 27.7 21.8 59.2 45.9
Other operating expenses 10.6 11.8 32.7 34.2
Selling, general and
administrative 38.0 38.7 119.4 114.9
(Reversal) provision for
possible losses (4.7) .3 (9.7) 10.1
Asset impairment charges .3 8.8 1.4 22.6
Fair value adjustments for
derivatives .8 .2 .1 2.6
--------- --------- --------- ---------
Total Other Costs and Expenses 119.0 124.9 343.5 355.6
--------- --------- --------- ---------
Income from Continuing
Operations before Income
Taxes 73.1 33.5 131.1 63.8
Income Taxes 24.9 12.2 43.5 24.1
--------- --------- --------- ---------
Income from Continuing
Operations 48.2 21.3 87.6 39.7
Discontinued Operations
Operating results, net of taxes (.2) 1.4 18.5 9.6
Loss on sale of segment, net of
taxes (7.3) - (7.7) -
--------- --------- --------- ---------
Total Discontinued Operations (7.5) 1.4 10.8 9.6
--------- --------- --------- ---------
Net Income $40.7 $22.7 $98.4 $49.3
========= ========= ========= =========
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(In Millions, Except Per Share Data)
(Continued)
Three Months Ended Nine Months Ended
September 30 September 30
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Per Share Data
Basic:
Income from continuing
operations $.98 $.43 $1.78 $.80
Income from discontinued
operations (.16) .03 .22 .20
--------- --------- --------- ---------
Total $.82 $.46 $2.00 $1.00
========= ========= ========= =========
Average number of common shares
(in thousands) 49,361 49,106 49,308 49,082
Diluted:
Income from continuing
operations $.92 $.43 $1.72 $.80
Income from discontinued
operations (.14) .03 .20 .20
--------- --------- --------- ---------
Total $.78 $.46 $1.92 $1.00
========= ========= ========= =========
Average number of common shares
and common share equivalents
(in thousands) 54,923 54,358 54,784 49,195
Dividends declared per common
share $.20 $.32 $.60 $.96
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In Millions)
September 30 December 31
2004 2003
------------- -------------
Assets
Cash and Cash Equivalents $143.2 $211.5
Restricted Cash 57.9 60.9
Receivables
Rent and other receivables 122.9 91.6
Finance leases 272.8 289.2
Loans 105.5 183.5
Less - allowance for possible losses (27.8) (45.6)
------------- -------------
473.4 518.7
Operating Lease Assets, Facilities and
Other
Railcars and service facilities 3,554.2 3,374.6
Operating lease investments and other 1,953.8 1,804.2
Less - allowance for depreciation (1,825.0) (1,831.5)
------------- -------------
3,683.0 3,347.3
Progress payments for aircraft and other
equipment 19.5 53.6
------------- -------------
3,702.5 3,400.9
Investments in Affiliated Companies 800.7 847.6
Recoverable Income Taxes - 53.8
Goodwill, Net 87.0 87.2
Other Investments 72.8 101.6
Other Assets 251.8 238.3
Assets of Discontinued Operations 58.9 560.1
------------- -------------
$5,648.2 $6,080.6
============= =============
Liabilities and Shareholders' Equity
Accounts Payable and Accrued Expenses $371.0 $354.8
Debt
Short-term 11.4 15.9
Long-term:
Recourse 3,113.5 3,255.9
Nonrecourse 94.9 99.3
Capital lease obligations 96.7 122.4
------------- -------------
3,316.5 3,493.5
Deferred Income Taxes 698.9 671.7
Other Liabilities 278.9 325.4
Liabilities of Discontinued Operations - 346.3
------------- -------------
Total Liabilities 4,665.3 5,191.7
Total Shareholders' Equity 982.9 888.9
------------- -------------
$5,648.2 $6,080.6
============= =============
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(In Millions)
Three Months Ended Nine Months Ended
September 30 September 30
------------------- -------------------
2004 2003 2004 2003
--------- --------- --------- ---------
Operating Activities
Net income, including
discontinued operations $40.7 $22.7 $98.4 $49.3
Adjustments to reconcile net
income to net cash provided by
operating activities:
Realized gains on
remarketing of leased
equipment (4.9) (5.3) (30.8) (26.1)
Gain on sale of
securities (.2) (5.8) (3.4) (6.3)
Pretax loss on sale of
segment 12.1 - 12.7 -
Depreciation 52.5 81.6 185.1 246.1
(Reversal) provision for
possible losses (4.5) .4 (9.6) 8.8
Asset impairment charges .3 9.5 3.7 25.6
Deferred income taxes 15.0 36.8 29.5 53.0
Share of affiliates'
earnings, net of dividends (13.6) (14.6) (34.2) (45.6)
Increase in insurance
recoveries receivable (45.0) - (45.0) -
Decrease (increase) in
recoverable income taxes 3.7 (27.0) 61.7 64.3
Net decrease in operating
lease payable (15.0) (16.0) (26.5) (18.6)
Other (3.3) (18.7) (41.0) (31.0)
--------- --------- --------- ---------
Net cash provided by
operating activities 37.8 63.6 200.6 319.5
Investing Activities
Additions to equipment on
lease, net of nonrecourse
financing for leveraged leases,
operating lease assets and
facilities (145.7) (124.8) (597.3) (463.9)
Loans extended (.3) (10.9) (14.2) (48.6)
Investments in affiliated
companies - (4.8) (3.1) (49.0)
Progress payments (.4) (3.5) (2.0) (26.1)
Other investments (1.3) (1.0) (28.8) (25.2)
--------- --------- --------- ---------
Portfolio investments and
capital additions (147.7) (145.0) (645.4) (612.8)
Portfolio proceeds 67.3 183.4 389.4 573.8
Proceeds from other asset sales 3.8 4.3 24.7 19.1
Net proceeds from sale of
segment - - 214.7 -
Net decrease (increase) in
restricted cash 2.2 1.1 3.0 (76.1)
Effect of exchange rate changes
on restricted cash - - - 17.7
--------- --------- --------- ---------
Net cash (used in) provided
by investing activities (74.4) 43.8 (13.6) (78.3)
Financing Activities
Net proceeds from issuance of
long-term debt 42.0 241.5 202.5 574.5
Repayment of long-term debt (66.6) (410.0) (404.9) (846.7)
Net increase (decrease) in
short-term debt 2.8 8.3 (2.1) 16.8
Net decrease in capital lease
obligations (9.5) (5.2) (25.7) (20.0)
Issuance of common stock and
other 2.2 1.1 3.3 1.7
Cash dividends (9.8) (15.7) (29.5) (47.1)
--------- --------- --------- ---------
Net cash used in financing
activities (38.9) (180.0) (256.4) (320.8)
Effect of Exchange Rate Changes
on Cash and Cash Equivalents 1.8 (2.1) 1.1 .6
--------- --------- --------- ---------
Net Decrease in Cash and Cash
Equivalents $(73.7) $(74.7) $(68.3) $(79.0)
========= ========= ========= =========
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Three Months Ended September 30, 2004
(In Millions)
Discontinued GATX
Rail Air Specialty Other Operations Consolidated
------- ------ --------- ------ ---------- ------------
Gross Income
Lease income $167.5 $25.8 $6.9 $- $- $200.2
Marine
operating
revenue - - - 36.2 - 36.2
Interest income - - 2.9 - - 2.9
Asset
remarketing
income .7 3.2 1.2 - - 5.1
Gain on sale of
securities - - .2 - - .2
Fees .8 2.2 2.7 - - 5.7
Other 12.0 .4 1.3 46.2 - 59.9
------- ------ --------- ------ ---------- ------------
Revenues 181.0 31.6 15.2 82.4 - 310.2
Share of
affiliates'
earnings 3.1 8.3 5.8 - - 17.2
------- ------ --------- ------ ---------- ------------
Total Gross
Income 184.1 39.9 21.0 82.4 - 327.4
Ownership Costs
Depreciation 30.1 15.1 1.1 2.5 - 48.8
Interest, net 20.4 10.6 6.2 4.3 - 41.5
Operating lease
expense 43.4 .9 1.0 (.3) - 45.0
------- ------ --------- ------ ---------- ------------
Total Ownership
Costs 93.9 26.6 8.3 6.5 - 135.3
Other Costs and
Expenses
Maintenance
expense 45.8 .3 .2 - - 46.3
Marine
operating
expenses - - - 27.7 - 27.7
Other operating
expenses 8.7 .6 1.3 - - 10.6
Selling,
general and
administrative 17.7 5.3 2.1 12.9 - 38.0
Reversal of
provision for
possible
losses (1.0) (.1) (2.9) (.7) - (4.7)
Asset
impairment
charges - - .3 - - .3
Fair value
adjustments
for
derivatives - - .8 - - .8
------- ------ --------- ------ ---------- ------------
Total Other
Costs and
Expenses 71.2 6.1 1.8 39.9 - 119.0
------- ------ --------- ------ ---------- ------------
Income from
Continuing
Operations
before Income
Taxes 19.0 7.2 10.9 36.0 - 73.1
Income Taxes 5.8 2.2 4.5 12.4 - 24.9
------- ------ --------- ------ ---------- ------------
Income from
Continuing
Operations 13.2 5.0 6.4 23.6 - 48.2
Discontinued
Operations
Operations, net
of taxes - - - - (.2) (.2)
Loss on sale of
Segment, net
of taxes - - - - (7.3) (7.3)
------- ------ --------- ------ ---------- ------------
Total
Discontinued
Operations - - - - (7.5) (7.5)
------- ------ --------- ------ ---------- ------------
Net Income
(Loss) $13.2 $5.0 $6.4 $23.6 $(7.5) $40.7
======= ====== ========= ====== ========== ============
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Three Months Ended September 30, 2003
(In Millions)
Discontinued GATX
Rail Air Specialty Other Operations Corporation
------- ------ --------- ------ ---------- -----------
Gross Income
Lease income $159.9 $22.9 $10.2 $- $- $193.0
Marine operating
revenue - - - 27.3 - 27.3
Interest income - .1 9.0 (.1) - 9.0
Asset
remarketing
income (.2) .2 6.5 - - 6.5
Gain on sale of
securities - - 5.8 - - 5.8
Fees .9 2.0 .8 - - 3.7
Other 11.8 5.4 .5 12.9 - 30.6
------- ------ --------- ------ ---------- -----------
Revenues 172.4 30.6 32.8 40.1 - 275.9
Share of
affiliates'
earnings 4.0 7.5 5.2 - - 16.7
------- ------ --------- ------ ---------- -----------
Total Gross
Income 176.4 38.1 38.0 40.1 - 292.6
Ownership Costs
Depreciation 28.5 14.0 2.5 1.9 - 46.9
Interest, net 15.2 10.0 10.6 6.4 - 42.2
Operating lease
expense 43.1 .9 1.1 - - 45.1
------- ------ --------- ------ ---------- -----------
Total Ownership
Costs 86.8 24.9 14.2 8.3 - 134.2
Other Costs and
Expenses
Maintenance
expense 42.8 .2 .3 - - 43.3
Marine operating
expenses - - - 21.8 - 21.8
Other operating
expenses 8.6 .3 1.8 1.1 - 11.8
Selling, general
and
administrative 16.5 3.9 3.7 14.6 - 38.7
(Reversal)
provision for
possible losses (1.5) (.1) 2.0 (.1) - .3
Asset impairment
charges - 5.2 - 3.6 - 8.8
Fair value
adjustments for
derivatives - - .2 - - .2
------- ------ --------- ------ ---------- -----------
Total Other
Costs and
Expenses 66.4 9.5 8.0 41.0 - 124.9
------- ------ --------- ------ ---------- -----------
Income (Loss)
from Continuing
Operations
before Income
Taxes 23.2 3.7 15.8 (9.2) - 33.5
Income Tax
Provision
(Benefit) 8.0 .3 6.8 (2.9) - 12.2
------- ------ --------- ------ ---------- -----------
Income (Loss)
from Continuing
Operations 15.2 3.4 9.0 (6.3) - 21.3
Discontinued
Operations
Operating
results, net
of taxes - - - - 1.4 1.4
Gain on sale
of portion
of segment,
net of taxes - - - - - -
------- ------ --------- ------ ---------- -----------
Total
Discontinued
Operations - - - - 1.4 1.4
------- ------ --------- ------ ---------- -----------
Net Income
(Loss) $15.2 $3.4 $9.0 $(6.3) $1.4 $22.7
======= ====== ========= ====== ========== ===========
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Nine Months Ended September 30, 2004
(In Millions)
Discontinued GATX
Rail Air Specialty Other Operations Consolidated
------- ------ --------- ------ ---------- ------------
Gross Income
Lease income $491.2 $71.1 $21.6 $- $- $583.9
Marine
operating
revenue - - - 76.2 - 76.2
Interest income - .2 15.1 - - 15.3
Asset
remarketing
income 6.8 3.6 21.8 - - 32.2
Gain on sale of
securities - - 3.4 - - 3.4
Fees 2.2 7.3 4.4 - - 13.9
Other 42.6 1.7 2.5 49.6 - 96.4
------- ------ --------- ------ ---------- ------------
Revenues 542.8 83.9 68.8 125.8 - 821.3
Share of
affiliates'
earnings 12.9 23.9 14.4 - - 51.2
------- ------ --------- ------ ---------- ------------
Total Gross
Income 555.7 107.8 83.2 125.8 - 872.5
Ownership Costs
Depreciation 91.1 43.4 3.2 4.5 - 142.2
Interest, net 55.3 28.9 20.3 15.4 - 119.9
Operating lease
expense 130.1 2.9 3.1 (.3) - 135.8
------- ------ --------- ------ ---------- ------------
Total Ownership
Costs 276.5 75.2 26.6 19.6 - 397.9
Other Costs and
Expenses
Maintenance
expense 138.0 1.6 .8 - - 140.4
Marine
operating
expenses - - - 59.2 - 59.2
Other operating
expenses 27.4 1.4 3.9 - - 32.7
Selling,
general and
administrative 51.1 15.8 7.2 45.3 - 119.4
Reversal of
provision for
possible
losses (.8) (.5) (7.7) (.7) - (9.7)
Asset
impairment
charges - - 1.1 .3 - 1.4
Fair value
adjustments
for
derivatives - - .1 - - .1
------- ------ --------- ------ ---------- ------------
Total Other
Costs and
Expenses 215.7 18.3 5.4 104.1 - 343.5
------- ------ --------- ------ ---------- ------------
Income from
Continuing
Operations
before
Income Taxes 63.5 14.3 51.2 2.1 - 131.1
Income Taxes 18.9 4.7 19.8 .1 - 43.5
------- ------ --------- ------ ---------- ------------
Income from
Continuing
Operations 44.6 9.6 31.4 2.0 - 87.6
Discontinued
Operations
Operations, net
of taxes - - - - 18.5 18.5
Loss on sale of
segment, net
of taxes - - - - (7.7) (7.7)
------- ------ --------- ------ ---------- ------------
Total
Discontinued
Operations - - - - 10.8 10.8
------- ------ --------- ------ ---------- ------------
Net Income $44.6 $9.6 $31.4 $2.0 $10.8 $98.4
======= ====== ========= ====== ========== ============
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Nine Months Ended September 30, 2003
(In Millions)
Discontinued GATX
Rail Air Specialty Other Operations Consolidated
------- ------ --------- ------- ---------- ------------
Gross Income
Lease income $475.6 $67.5 $34.1 $- $- $577.2
Marine
operating
revenue - - - 57.0 - 57.0
Interest
income - (.1) 30.7 - - 30.6
Asset
remarketing
income 4.4 .6 18.9 - - 23.9
Gain on sale
of securities - - 6.3 - - 6.3
Fees 2.7 5.7 5.8 - - 14.2
Other 35.3 7.7 5.9 17.2 - 66.1
------- ------ --------- ------- ---------- ------------
Revenues 518.0 81.4 101.7 74.2 - 775.3
Share of
affiliates'
earnings 8.7 26.1 20.8 - - 55.6
------- ------ --------- ------- ---------- ------------
Total Gross
Income 526.7 107.5 122.5 74.2 - 830.9
Ownership
Costs
Depreciation 86.5 41.0 7.9 4.2 - 139.6
Interest, net 49.1 31.0 34.3 20.2 - 134.6
Operating
lease
expense 130.6 2.9 3.4 0.4 - 137.3
------- ------ --------- ------- ---------- ------------
Total
Ownership
Costs 266.2 74.9 45.6 24.8 - 411.5
Other Costs
and Expenses
Maintenance
expense 123.0 1.5 .8 - - 125.3
Marine
operating
expenses - - - 45.9 - 45.9
Other
operating
expenses 26.6 .5 6.0 1.1 - 34.2
Selling,
general and
administrative 48.7 12.2 13.8 40.2 - 114.9
(Reversal)
provision
for possible
losses (1.7) 9.7 .4 1.7 - 10.1
Asset
impairment
charges - 7.1 9.1 6.4 - 22.6
Fair value
adjustments
for
derivatives .1 - 2.5 - - 2.6
------- ------ --------- ------- ---------- ------------
Total Other
Costs and
Expenses 196.7 31.0 32.6 95.3 - 355.6
------- ------ --------- ------- ---------- ------------
Income (Loss)
from Continuing
Operations
before Income
Taxes 63.8 1.6 44.3 (45.9) - 63.8
Income Tax
Provision
(Benefit) 22.8 .6 17.6 (16.9) - 24.1
------- ------ --------- ------- ---------- ------------
Income (Loss)
from
Continuing
Operations 41.0 1.0 26.7 (29.0) - 39.7
Discontinued
Operations
Operating
results,
net of
taxes - - - - 9.6 9.6
Gain on
sale of
portion
of segment,
net of
taxes - - - - - -
------- ------ --------- ------- ---------- ------------
Total
Discontinued
Operations - - - - 9.6 9.6
------- ------ --------- ------- ---------- ------------
Net Income
(Loss) $41.0 $1.0 $26.7 $(29.0) $9.6 $49.3
======= ====== ========= ======= ========== ============
GATX CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION (UNAUDITED)
(In Millions, Except Railcar Data)
Quarter Quarter
Ending Ending
9/30/2004 12/31/2003 9/30/2003
----------- ----------- -----------
Total Continuing Assets,
Excluding Cash (a) $6,613.8 $6,531.3 $6,479.3
Net (Recoveries) Charge-Offs and
Asset Impairments and Write-Downs (.6) 11.8
Net Charge-Offs/Impairments/Write-Downs
as a Percentage of Average
Total Assets (Annualized) N/A .7%
Non-performing Investments 58.6 76.1 135.1
Capital Structure
Short-term Debt, Net of
Unrestricted Cash (131.8) (195.6) (119.9)
Long-term Debt:
On Balance Sheet
Recourse 3,113.5 3,255.9 3,208.6
Nonrecourse 94.9 99.3 150.8
Off Balance Sheet
Recourse 918.3 970.2 971.2
Nonrecourse 307.3 313.0 317.0
Capital Lease Obligations 96.7 122.4 123.7
Total Net Debt Obligations 4,398.9 4,565.2 4,651.4
Total Recourse Debt 3,996.7 4,152.9 4,183.6
Shareholders' Equity and Allowance
for Losses 1,010.7 934.5 877.3
Recourse Leverage 4.0 4.4 4.8
Asset Remarketing Income
------------------------
Disposition gains on owned assets 3.3 4.3
Residual sharing fees 1.8 2.2
----------- -----------
5.1 6.5
Full Year
Railcar Data 2003
------------ -----------
North American Fleet Utilization 97% 93% 93%
Beginning Fleet Size 106,360 107,150 105,066
Additions 1,008 2,388 288
Scrapped/Sold (374) (4,290) (861)
----------- ----------- -----------
Ending Fleet Size 106,994 105,248 104,493
(a) Includes Off Balance Sheet Assets
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