Raises Dividend by 8.0% to
Third Quarter and Year-to-Date 2010 Highlights
- Paid a
$0.25 per common share dividend onSeptember 1, 2010 to all shareholders of record as ofAugust 23, 2010 ; - Declared a dividend increase of 8.0% to
$0.27 per common share, payable onNovember 24, 2010 to all shareholders of record as ofNovember 15, 2010 , increasing total dividends declared since theOctober 2007 IPO to$3.00 per common share; - Recorded net income attributable to
Textainer Group Holdings Limited common shareholders of$30.7 million , or$0.62 per diluted common share, for the third quarter and$80.0 million , or$1.63 per diluted common share, for the nine months endedSeptember 30, 2010 ; - Recorded net income attributable to
Textainer Group Holdings Limited common shareholders excluding unrealized losses (gains) on interest rate swaps, net(1) of$33.3 million , or$0.67 per diluted common share, for the third quarter, and$87.8 million , or$1.79 per diluted common share, for the nine months endedSeptember 30, 2010 ; - Increased average fleet utilization to 98.0% for the third quarter from 85.4% for the third quarter of 2009;
- Utilized balance sheet strength to order a total of 212,620 Twenty-Foot Equivalent Units ("TEU") of new containers for delivery through
December 2010 , representing a total of$506.6 million in capital expenditures.
Total revenue for the quarter was
Net income attributable to
Net income attributable to
Net income attributable to
Net income attributable to
Mr. Maccarone concluded, "Based on the continued execution of our business plan combined with the positive industry fundamentals, we are pleased to once again increase our quarterly dividend. Textainer's third quarter dividend of
Outlook
Industry
For 2010, it is estimated that total new container production will only be approximately 2.0 million TEU as it took some time for container manufacturers in
With respect to demand, cargo volumes are expected to grow 10% to 11% in 2010 compared to 2009, which is considerably higher than initial projections for the year. We believe that many container shipping lines do not have a sufficient capex budget this year to purchase new containers, and they will therefore continue to rely heavily on leasing companies such as
Going forward,
Strategic Focus
With significant access to capital, we will continue to explore accretive growth opportunities that we expect to create short-term and long-term value.
Dividend
On
Investors' Webcast
About
Important Cautionary Information Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of U.S. securities laws. Forward-looking statements include statements that are not statements of historical facts and include, without limitation, statements regarding (i) Textainer's belief that by significantly expanding its fleet in an accretive manner and increasing its contracted revenue streams with a diverse group of shipping lines, it will remain well positioned to further strengthen its industry leadership and drive future performance; (ii) Textainer's belief that it continues to benefit from a worldwide shortage of containers; (iii) Textainer's estimate that total production capability for 2010 will only be approximately 2.0 million TEU as it has taken some time for container manufactures in
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES | |||||||||||||
Condensed Consolidated Balance Sheets | |||||||||||||
September 30, 2010 and December 31, 2009 | |||||||||||||
(Unaudited) | |||||||||||||
(All currency expressed in United States dollars in thousands) | |||||||||||||
|
| ||||||||||||
2010 |
2009 | ||||||||||||
Assets | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 62,972 | $ | 56,819 | |||||||||
Accounts receivable, net of allowance for doubtful accounts of $7,835 and $8,347 in 2010 and 2009, respectively |
51,748 | 68,896 | |||||||||||
Net investment in direct financing and sales-type leases | 18,431 | 17,225 | |||||||||||
Trading containers | 249 | 1,271 | |||||||||||
Containers held for sale | 1,830 | 9,756 | |||||||||||
Prepaid expenses | 8,036 | 1,785 | |||||||||||
Deferred taxes | 1,459 | 1,463 | |||||||||||
Due from affiliates, net | - | 126 | |||||||||||
Total current assets | 144,725 | 157,341 | |||||||||||
Restricted cash | 13,848 | 6,586 | |||||||||||
Containers, net of accumulated depreciation of $349,318 and $343,513 at 2010 and 2009, respectively |
1,269,187 | 1,061,866 | |||||||||||
Net investment in direct financing and sales-type leases | 74,969 | 63,326 | |||||||||||
Fixed assets, net of accumulated depreciation of $8,792 and $8,512 at 2010 and 2009, respectively |
1,611 | 1,986 | |||||||||||
Intangible assets, net of accumulated amortization of $25,830 and $20,897 at 2010 and 2009, respectively |
61,733 | 66,692 | |||||||||||
Interest rate swaps | - | 731 | |||||||||||
Other assets | 7,656 | 1,495 | |||||||||||
Total assets | $ | 1,573,729 | $ | 1,360,023 | |||||||||
Liabilities and Equity | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ | 3,705 | $ | 9,078 | |||||||||
Accrued expenses | 11,522 | 9,740 | |||||||||||
Container contracts payable | 139,140 | 13,140 | |||||||||||
Deferred revenue | 7,027 | 7,948 | |||||||||||
Due to owners, net | 17,920 | 14,141 | |||||||||||
Secured debt facility | - | 16,500 | |||||||||||
Bonds payable | 51,500 | 51,500 | |||||||||||
Total current liabilities | 230,814 | 122,047 | |||||||||||
Revolving credit facility | 101,000 | 79,000 | |||||||||||
Secured debt facility | 368,602 | 313,021 | |||||||||||
Bonds payable | 188,401 | 226,875 | |||||||||||
Deferred revenue | 4,837 | 11,294 | |||||||||||
Interest rate swaps | 17,756 | 8,971 | |||||||||||
Income tax payable | 18,488 | 18,656 | |||||||||||
Deferred taxes | 7,719 | 6,894 | |||||||||||
Total liabilities | 937,617 | 786,758 | |||||||||||
Equity: | |||||||||||||
Textainer Group Holdings Limited shareholders' equity: | |||||||||||||
Common shares, $0.01 par value. Authorized 140,000,000 shares; issued and outstanding 48,204,615 and 47,760,771 at 2010 and 2009, respectively |
482 | 478 | |||||||||||
Additional paid-in capital | 179,058 | 170,497 | |||||||||||
Accumulated other comprehensive loss | (99 | ) | (111 | ) | |||||||||
Retained earnings | 374,827 | 329,449 | |||||||||||
Total Textainer Group Holdings Limited shareholders' equity | 554,268 | 500,313 | |||||||||||
Noncontrolling interest | 81,844 | 72,952 | |||||||||||
Total equity | 636,112 | 573,265 | |||||||||||
Total liabilities and equity | $ | 1,573,729 | $ | 1,360,023 | |||||||||
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES | ||||||||||||||||||||||
Condensed Consolidated Statements of Income | ||||||||||||||||||||||
Three and Nine Months Ended September 30, 2010 and 2009 | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
(All currency expressed in United States dollars in thousands, except per share amounts) | ||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||
2010 |
2009 |
2010 |
2009 |
|||||||||||||||||||
Revenues: | ||||||||||||||||||||||
Lease rental income | $ | 61,268 | $ | 45,428 | $ | 167,590 | $ | 138,719 | ||||||||||||||
Management fees | 7,760 | 6,769 | 21,065 | 18,647 | ||||||||||||||||||
Trading container sales proceeds | 1,982 | 1,584 | 9,406 | 5,272 | ||||||||||||||||||
Gains on sale of containers, net | 4,242 | 2,273 | 20,914 | 7,435 | ||||||||||||||||||
Total revenues | 75,252 | 56,054 | 218,975 | 170,073 | ||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||
Direct container expense | 4,107 | 10,276 | 21,448 | 27,586 | ||||||||||||||||||
Cost of trading containers sold | 1,595 | 1,274 | 7,493 | 4,553 | ||||||||||||||||||
Depreciation expense | 14,891 | 12,553 | 40,922 | 34,966 | ||||||||||||||||||
Amortization expense | 1,636 | 2,020 | 4,788 | 5,479 | ||||||||||||||||||
General and administrative expense | 5,146 | 4,859 | 16,095 | 15,248 | ||||||||||||||||||
Short-term incentive compensation expense | 1,347 | 640 | 3,463 | 1,830 | ||||||||||||||||||
Long-term incentive compensation expense | 1,062 | 892 | 4,200 | 2,616 | ||||||||||||||||||
Bad debt expense (recovery), net | 227 | 1,011 | (254 | ) | 3,205 | |||||||||||||||||
Total operating expenses | 30,011 | 33,525 | 98,155 | 95,483 | ||||||||||||||||||
Income from operations | 45,241 | 22,529 | 120,820 | 74,590 | ||||||||||||||||||
Other income (expense): | ||||||||||||||||||||||
Interest expense | (6,058 | ) | (2,587 | ) | (11,493 | ) | (8,899 | ) | ||||||||||||||
Gain on early extinguishment of debt | - | - | - | 19,398 | ||||||||||||||||||
Interest income | 8 | 8 | 14 | 59 | ||||||||||||||||||
Realized losses on interest rate swaps and caps, net | (2,292 | ) | (3,538 | ) | (7,399 | ) | (11,240 | ) | ||||||||||||||
Unrealized (losses) gains on interest rate swaps, net | (3,188 | ) | (809 | ) | (9,516 | ) | 7,253 | |||||||||||||||
Gain on lost military containers, net | 152 | 646 | 498 | 814 | ||||||||||||||||||
Other, net | (492 | ) | 156 | (829 | ) | 125 | ||||||||||||||||
Net other (expense) income | (11,870 | ) | (6,124 | ) | (28,725 | ) | 7,510 | |||||||||||||||
Income before income tax and noncontrolling interest | 33,371 | 16,405 | 92,095 | 82,100 | ||||||||||||||||||
Income tax benefit (expense) | 49 | (1,197 | ) | (3,219 | ) | (4,853 | ) | |||||||||||||||
Net income | 33,420 | 15,208 | 88,876 | 77,247 | ||||||||||||||||||
Less: Net income attributable to the noncontrolling interest | (2,752 | ) | (1,705 | ) | (8,892 | ) | (11,815 | ) | ||||||||||||||
Net income attributable to Textainer Group Holdings | ||||||||||||||||||||||
Limited common shareholders | $ | 30,668 | $ | 13,503 | $ | 79,984 | $ | 65,432 | ||||||||||||||
Net income attributable to Textainer Group Holdings Limited common shareholders per share:
|
||||||||||||||||||||||
Basic | $ | 0.64 | $ | 0.28 | $ | 1.67 | $ | 1.37 | ||||||||||||||
Diluted | $ | 0.62 | $ | 0.28 | $ | 1.63 | $ | 1.36 | ||||||||||||||
Weighted average shares outstanding (in thousands): | ||||||||||||||||||||||
Basic | 48,171 | 47,761 | 47,907 | 47,761 | ||||||||||||||||||
Diluted | 49,441 | 48,212 | 49,039 | 48,016 |
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES | ||||||||||||||
Condensed Consolidated Statements of Cash Flows | ||||||||||||||
Nine months Ended September 30, 2010 and 2009 | ||||||||||||||
(Unaudited) | ||||||||||||||
(All currency expressed in United States dollars in thousands) | ||||||||||||||
Nine Months Ended September 30, | ||||||||||||||
2010 | 2009 | |||||||||||||
Cash flows from operating activities: | ||||||||||||||
Net income | $ | 88,876 | $ | 77,247 | ||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
Depreciation expense | 40,922 | 34,966 | ||||||||||||
Bad debt (recovery) expense, net | (254 | ) | 3,205 | |||||||||||
Unrealized losses (gains) on interest rate swaps, net | 9,516 | (7,253 | ) | |||||||||||
Amortization of debt issuance costs | 2,711 | 1,655 | ||||||||||||
Amortization of intangible assets | 4,788 | 5,479 | ||||||||||||
Amortization of acquired above-market leases | 170 | 1,143 | ||||||||||||
Amortization of deferred revenue | (5,345 | ) | (1,996 | ) | ||||||||||
Amortization of unearned income on direct financing and sales-type leases | (6,044 | ) | (6,288 | ) | ||||||||||
Gains on sale of containers and lost military containers, net | (21,412 | ) | (8,249 | ) | ||||||||||
Gain on early extinguishment of debt | - | (19,398 | ) | |||||||||||
Share-based compensation expense | 4,316 | 2,536 | ||||||||||||
Changes in operating assets and liabilities | 572 | 422 | ||||||||||||
Total adjustments | 29,940 | 6,222 | ||||||||||||
Net cash provided by operating activities | 118,816 | 83,469 | ||||||||||||
Cash flows from investing activities: | ||||||||||||||
Purchase of containers and fixed assets | (181,134 | ) | (61,554 | ) | ||||||||||
Purchase of intangible assets | - | (13,822 | ) | |||||||||||
Proceeds from sale of containers and fixed assets | 61,441 | 42,476 | ||||||||||||
Receipt of principal payments on direct financing and sales-type leases | 34,393 | 19,237 | ||||||||||||
Net cash used in investing activities | (85,300 | ) | (13,663 | ) | ||||||||||
Cash flows from financing activities: | ||||||||||||||
Proceeds from revolving credit facility | 51,000 | 10,000 | ||||||||||||
Principal payments on revolving credit facility | (29,000 | ) | (60,000 | ) | ||||||||||
Proceeds from secured debt facility | 109,000 | 125,500 | ||||||||||||
Principal payments on secured debt facility | (70,000 | ) | (86,000 | ) | ||||||||||
Principal payments on bonds payable | (38,625 | ) | (40,418 | ) | ||||||||||
Purchase of bonds payable | - | (20,234 | ) | |||||||||||
(Increase) decrease in restricted cash | (7,262 | ) | 10,316 | |||||||||||
Issuance of common shares | (11,669 | ) | - | |||||||||||
Debt issuance costs | 3,787 | (112 | ) | |||||||||||
Dividends paid | (34,606 | ) | (32,955 | ) | ||||||||||
Net cash used in financing activities | (27,375 | ) | (93,903 | ) | ||||||||||
Effect of exchange rate changes | 12 | 61 | ||||||||||||
Net increase (decrease) in cash and cash equivalents | 6,153 | (24,036 | ) | |||||||||||
Cash and cash equivalents, beginning of the year | 56,819 | 71,490 | ||||||||||||
Cash and cash equivalents, end of period | $ | 62,972 | $ | 47,454 | ||||||||||
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES
Non-GAAP Reconciliation of Net Income to EBITDA, Net Income to Net Income Excluding Unrealized
Losses (Gains) on Interest Rate Swaps, Net and Gain on Early Extinguishment of Debt to Gain on Early
Extinguishment of Debt Net of Related Noncontrolling Interest
Three and Nine Months Ended
(Unaudited)
(All currency expressed in
(1) The following is a reconciliation of net income to EBITDA, a reconciliation of net income attributable to
- They do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;
- They do not reflect changes in, or cash requirements for, our working capital needs;
- EBITDA does not reflect interest expense or cash requirements necessary to service interest or principal payments on our debt;
- Although depreciation is a noncash charge, the assets being depreciated may be replaced in the future, and neither EBITDA, net income attributable to
Textainer Group Holdings Limited common shareholders excluding unrealized losses (gains) on interest rate swaps, net or net income attributable toTextainer Group Holdings Limited common shareholders per diluted common share excluding unrealized losses (gains) on interest rate swaps, net reflects any cash requirements for such replacements; - They are not adjusted for all noncash income or expense items that are reflected in our statements of cash flows; and
- Other companies in our industry may calculate these measures differently than we do, limiting their usefulness as comparative measures.
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
|
2010 | 2009 | 2010 | 2009 | |||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||
Reconciliation of EBITDA: | |||||||||||||||||
Net income attributable to Textainer Group Holdings Limited common
shareholders |
$ | 30,668 | $ | 13,503 | $ | 79,984 | $ | 65,432 | |||||||||
Adjustments: | |||||||||||||||||
Interest income | (8 | ) | (8 | ) | (14 | ) | (59 | ) | |||||||||
Interest expense | 6,058 | 2,587 | 11,493 | 8,899 | |||||||||||||
Realized losses on interest rate swaps and caps, net | 2,292 | 3,538 | 7,399 | 11,240 | |||||||||||||
Unrealized losses (gains) on interest rate swaps, net | 3,188 | 809 | 9,516 | (7,253 | ) | ||||||||||||
Income tax (benefit) expense | (49 | ) | 1,197 | 3,219 | 4,853 | ||||||||||||
Net income attributable to the noncontrolling interest | 2,752 | 1,705 | 8,892 | 11,815 | |||||||||||||
Depreciation expense | 14,891 | 12,553 | 40,922 | 34,966 | |||||||||||||
Amortization expense | 1,636 | 2,020 | 4,788 | 5,479 | |||||||||||||
Impact of reconciling items on net income attributable to the noncontrolling interest
|
(5,023 | ) | (3,516 | ) | (12,504 | ) | (8,361 | ) | |||||||||
EBITDA | $ | 56,405 | $ | 34,388 | $ | 153,695 | $ | 127,011 | |||||||||
Net cash provided by operating activities | $ | 118,816 | $ | 83,469 | |||||||||||||
Adjustments: | |||||||||||||||||
Bad debt recovery (expense), net | 254 | (3,205 | ) | ||||||||||||||
Amortization of debt issuance costs | (2,711 | ) | (1,655 | ) | |||||||||||||
Amortization of acquired above-market leases | (170 | ) | (1,143 | ) | |||||||||||||
Amortization of deferred revenue | 5,345 | 1,996 | |||||||||||||||
Amortization of unearned income on direct financing and sales-type leases | 6,044 | 6,288 | |||||||||||||||
Gains on sale of containers and lost military containers, net | 21,412 | 8,249 | |||||||||||||||
Gain on early extinguishment of debt | - | 19,398 | |||||||||||||||
Share-based compensation expense | (4,316 | ) | (2,536 | ) | |||||||||||||
Interest expense | 11,493 | 8,899 | |||||||||||||||
Interest income | (14 | ) | (59 | ) | |||||||||||||
Realized losses on interest rate swaps and caps, net | 7,399 | 11,240 | |||||||||||||||
Income tax (benefit) expense | 3,219 | 4,853 | |||||||||||||||
Changes in operating assets and liabilities | (572 | ) | (422 | ) | |||||||||||||
Impact of reconciling items on net income attributable to the noncontrolling interest
|
(12,504 | ) | (8,361 | ) | |||||||||||||
EBITDA | $ | 153,695 | $ | 127,011 |
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2010 | 2009 | 2010 | 2009 | ||||||||||||||
(Dollars in thousands) | (Dollars in thousands) | ||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||
Reconciliation of net income attributable to Textainer Group Holdings Limited common shareholders excluding unrealized losses (gains) on interest rate swaps, net: |
|||||||||||||||||
Net income attributable to Textainer Group Holdings Limited common shareholders |
$ | 30,668 | $ | 13,503 | $ | 79,984 | $ | 65,432 | |||||||||
Adjustments: | |||||||||||||||||
Unrealized losses (gains) on interest rate swaps, net | 3,188 | 809 | 9,516 | (7,253 | ) | ||||||||||||
Impact of reconciling item on net income attributable to noncontrolling interest |
(580 | ) | (281 | ) | (1,750 | ) | 1,267 | ||||||||||
Net income attributable to Textainer Group Holdings Limited common shareholders excluding unrealized losses (gains) on interest rate swaps, net |
$ | 33,276 | $ | 14,031 | $ | 87,750 | $ | 59,446 | |||||||||
Reconciliation of net income attributable to Textainer Group Holdings Limited common shareholders per diluted common share excluding unrealized losses (gains) on interest rate swaps, net: |
|||||||||||||||||
Net income attributable to Textainer Group Holdings Limited common shareholders per diluted common share |
0.62 | $ | 0.28 | 1.63 | $ | 1.36 | |||||||||||
Adjustments: | |||||||||||||||||
Unrealized losses (gains) on interest rate swaps, net | 0.06 | 0.02 | 0.20 | (0.15 | ) | ||||||||||||
Impact of reconciling item on net income attributable to noncontrolling interest |
(0.01 | ) | (0.01 | ) | (0.04 | ) | 0.03 | ||||||||||
Net income attributable to Textainer Group Holdings Limited common shareholders per diluted common share excluding unrealized losses (gains) on interest rate swaps, net |
$ | 0.67 | $ | 0.29 | $ | 1.79 | $ | 1.24 | |||||||||
Reconciliation of gain on early extinguishment of debt to gain on early extinguishment of debt net of related noncontrolling interest |
|||||||||||||||||
Gain on early extinguishment of debt |
$ | - | $ | 19,398 | |||||||||||||
Adjustments: | |||||||||||||||||
Impact of gain on early extinguishment of debt on net income attributable to noncontrolling interest |
- | (3,607 | ) | ||||||||||||||
Gain on early extinguishment of debt net of related noncontrolling interest |
$ | - | $ | 15,791 |
Mr.
Investor Relations Director
ir@textainer.com
Source:
News Provided by Acquire Media