On this page of StockholderLetter.com we present the latest annual shareholder letter from GREENBRIER COMPANIES INC — ticker symbol GBX. Reading current and past GBX letters to shareholders can bring important insights into the investment thesis.
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11/14/2024 Letter Continued (Full PDF)
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11/13/2023 GBX Stockholder Letter
• More "Railroads" Category Stockholder Letters
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GBX Benford's Law Stock Score = 91
11/14/2024 Letter Continued (Full PDF)
•
11/13/2023 GBX Stockholder Letter•
More "Railroads" Category Stockholder Letters•
GBX Benford's Law Stock Score = 91GBX Shareholder/Stockholder Letter Transcript:
2024 ANNUAL REPORT 2024 ANNUAL REPORT CEO LETTER To Our Shareholders: Greenbrier delivered another strong performance in fiscal 2024 as we continued to execute our Better Together strategy. The year was highlighted by revenue of $3.5 billion and net earnings of $160 million or $4.96 per diluted share, one of our best years ever. Recurring revenue has increased through the growth of our leasing business and our industrial footprint is flexing to respond to heightened demand for programmatic railcar activity. Railcar rebodying work, stretch conversions, re-racking, deck conversions, tank car retrofits and requalifications are examples of the programmatic work designed to respond to our customers needs. In addition, the expansion of in-house fabrication for basic primary parts and subassemblies remains on track. Concentrating on these activities has allowed us to generate more sustained value from every corner of Greenbrier. Steady customer demand led to orders for 21,700 units, with more than 20% of orders resulting from lease originations. We are on track to meet or exceed our timeline for the long-term strategic goals that Greenbrier established 18 months ago. At the end of fiscal 2024, we have already grown recurring revenue by 25%, our aggregate gross margin of 15.8% exceeded the strategic goal, and ROIC nears our stated goal. Long-Term Strategic Goals 1 Double recurring revenue from a baseline of $113 million by fiscal 2028. 2 Expand our aggregate gross margin to the mid-teens by fiscal 2026. 3 Increase our return on invested capital (ROIC) to 10-14% by fiscal 2026. The past year also included major Greenbrier milestones: 30 years of listing on the New York Stock Exchange and 40 years of manufacturing and delivering the double-stack intermodal railcar were the most prominent. This provided the opportunity to ref l ect on Greenbrier s history in the rail industry. We have grown from a small-scale leasing company to a global leader in railcar engineering, manufacturing, leasing, management and services. In fiscal 2024, Greenbrier continued to enhance our market-leading position by executing on innovation. Our engineering team introduced the Ultra-High- Strength Steel GondolaTM and the Titan SeriesTM boxcar doors using high-strength steel technology. In addition, we launched an anhydrous ammonia tank car, the Multi-Max PlusTM for automotive transport and the Tilt FlatcarTM for moving large pieces of steel. These product offerings demonstrate our ongoing dedication to serving our customers through innovation, continuous improvement and manufacturing excellence. In July, the Greenbrier family experienced a deep loss with the passing of Board Member Patrick Ottensmeyer. Pat will be greatly missed and remembered as a visionary leader who left a lasting legacy for the North American rail industry. Please refer to a tribute to Pat inside this report. In July, the Greenbrier family experienced a deep loss with the passing of Board Member Patrick Ottensmeyer. Pat will be greatly missed and remembered as a visionary leader who left a lasting legacy for the North American rail industry. Please refer to the following page for a tribute to Pat s memory. SAFETY FOCUS Greenbrier is dedicated to creating an environment where all team members return home safely at the end of every shift. In fiscal 2024, we reaffirmed our commitment to our core value of safety. We held safety reset events across our global operations. Here, we workshopped methods to enhance our safety protocols and discussed the importance of employees proactively identifying risks and speaking up when they notice a potentially unsafe condition or behavior. In addition to the reset events, we introduced a refreshed safety onboarding process. Employee support and participation are essential to achieving our workplace safety goals. We will continue ref ining our approach for maximum engagement as we enter the new fiscal year. ADVANCING OUR STRATEGY Our fiscal 2024 successes are rooted in the dedication of our employees, who have fully embraced our Better Together strategy. We are meeting our operational targets to optimize our industrial footprint while expanding our leasing business and maintaining our manufacturing leadership position. Our success in advancing these goals depends on growing collaboration and facilitating more efficient and effective work environments. A substantial reorganization of our operations to enable better cross-departmental communications and simplify reporting structures was a critical step in fiscal 2024. We continue to pursue projects that will attract more freight to rail while collaborating on environmental initiatives that help our customers and investors achieve their sustainability goals. Our 2024 Sustainability Update provides more on our corporate social responsibility efforts. Entering fiscal 2025, a backlog of 26,700 units valued at $3.4 billion provides good visibility and room to maneuver as we strive to meet the most ambitious elements of our strategy. Embedded within our commitment to progress is the knowledge that there is always room to improve. We look to continually build employee engagement, foster innovation, and create opportunities to collaborate. I am excited about Greenbrier s future and look forward to improving customer experience, producing growth, and delivering shareholder value. Sincerely, Lorie L. Tekorius CEO & President November 2024 Remembering Patrick J. Ottensmeyer Greenbrier Board member Patrick J. Ottensmeyer passed away in July 2024 at the age of 67. He will be deeply missed and remembered as a wonderful friend, family member, colleague and leader. His expertise working across the U.S.-Mexico border and enhancing trade policy will have a long-lasting impact on the North American economy and the broader rail industry. He served on Greenbrier s Board of Directors from early 2023 until his passing. We are grateful for his service.