Key Financial Information (in thousands except for per share and TEU amounts) and Business Highlights:
QTD |
||||||||||||
Q2 2021 |
Q1 2021 |
Q2 2020 |
||||||||||
Lease rental income |
$ |
187,434 |
$ |
169,244 |
$ |
144,774 |
||||||
Gain on sale of owned fleet containers, net |
$ |
18,836 |
$ |
12,358 |
$ |
5,640 |
||||||
Income from operations |
$ |
110,007 |
$ |
92,101 |
$ |
49,265 |
||||||
Net income attributable to common shareholders |
$ |
73,795 |
$ |
62,050 |
$ |
15,989 |
||||||
Net income attributable to common shareholders per diluted common share |
$ |
1.45 |
$ |
1.22 |
$ |
0.30 |
||||||
Adjusted net income (1) |
$ |
75,204 |
$ |
59,152 |
$ |
14,794 |
||||||
Adjusted net income per diluted common share (1) |
$ |
1.48 |
$ |
1.16 |
$ |
0.28 |
||||||
Adjusted EBITDA (1) |
$ |
178,448 |
$ |
153,110 |
$ |
109,977 |
||||||
Average fleet utilization (2) |
99.8 |
% |
99.6 |
% |
95.4 |
% |
||||||
Total fleet size at end of period (TEU) (3) |
4,101,575 |
3,961,491 |
3,458,080 |
|||||||||
Owned percentage of total fleet at end of period |
90.6 |
% |
90.2 |
% |
86.1 |
% |
(1) |
Refer to the "Use of Non-GAAP Financial Information" set forth below. |
(2) |
Utilization is computed by dividing total units on lease in CEUs (cost equivalent unit) by the total units in our fleet in CEUs, excluding CEUs that have been designated as held for sale units and manufactured for us but have not yet been delivered to a lessee. CEU is a unit of measurement based on the approximate cost of a container relative to the cost of a standard 20-foot dry container. These factors may differ slightly from CEU ratios used by others in the industry. |
(3) |
TEU refers to a twenty-foot equivalent unit, which is a unit of measurement used in the container shipping industry to compare shipping containers of various lengths to a standard 20-foot container, thus a 20-foot container is one TEU and a 40-foot container is two TEU. |
- Net income of
$73.8 million for the second quarter, or$1.45 per diluted common share, as compared to$62.1 million , or$1.22 per diluted common share in the first quarter of 2021; - Adjusted net income of
$75.2 million for the second quarter, or$1.48 per diluted common share, as compared to$59.2 million , or$1.16 per diluted common share in the first quarter of 2021; - Adjusted EBITDA of
$178.4 million for the second quarter, as compared to$153.1 million in the first quarter of 2021; - Average and ending utilization rate for the second quarter of 99.8%;
- Invested
$501 million in containers delivered during the second quarter, for a total$1.1 billion delivered through the first six months of the year, virtually all of which are currently on lease with tenors in excess of 12 years; - Repurchased 615,680 shares of common stock at an average price of
$29.84 per share during the second quarter under the share repurchase program. As of the end of the second quarter, the remaining authority under the share repurchase program totaled$44.1 million ; - Priced
$600 million of fixed-rate asset backed notes onAugust 3, 2021 with a blended interest rate of 1.99% and 11-year tenor. The issuance is expected to close onAugust 11, 2021 and the resulting proceeds will be used to pay down other debt facilities and create additional borrowing capacity for future container investments; and Textainer's board of directors approved and declared a quarterly preferred cash dividend on its 7% Series A cumulative redeemable perpetual preference shares, payable onSeptember 15, 2021 , to holders of record as ofAugust 31, 2021 .
"We are pleased to deliver another quarter of strong results with outstanding performance across all of our key operating metrics. For the quarter, lease rental income increased 11% to
"Year-over-year, our on-hire fleet growth is nearly 30%. I am very proud of this strong execution across the organization as we continue to grow organically and improve profitability and returns, through our disciplined investments, focus on cost controls, and further optimization of our capital structure. We remain committed to enhancing our financial performance and delivering long-term value to our shareholders."
"The market environment remains very favorable, as high trade volumes coupled with logistical disruptions continue to support elevated levels of container demand. During the second quarter, we added
"During the year, we have strengthened our financial position through the continued optimization of our debt financing. As of the end of the quarter, our effective interest rate was 2.70% and 87% of our debt was fixed-rate with an average remaining tenor of almost 7 years. Combined with the extended remaining tenor of our lease portfolio, we have effectively locked in attractive long-term lease profit margins. Our strong cash flow generation and capital optimization initiatives have facilitated our accretive container investments as well as our ongoing share repurchase program, where we repurchased approximately 616,000 shares in the second quarter bringing the total shares repurchased to over 1.1 million in the first half of the year."
"As we look out to the second half of the year, we remain confident in the strength of the underlying business fundamentals, and we believe our business is well-positioned to sustain the positive momentum. The current market environment remains very favorable, and we expect container demand to remain elevated through the rest of the year. We are heading into the traditional peak season with retail inventory levels still relatively low in the
Second-Quarter Results
Lease rental income increased
Trading container margin increased
Gain on sale of owned fleet containers, net increased
Direct container expense – owned fleet decreased
Depreciation expense increased
Interest expense increased
Write-off of unamortized deferred debt issuance costs and bond discounts amounted to
Conference Call and Webcast
A conference call to discuss the financial results for the second quarter 2021 will be held at
About
Important Cautionary Information Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of
Investor Relations
Phone: +1 (415) 658-8333
ir@textainer.com
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES Consolidated Statements of Operations (Unaudited) (All currency expressed in |
||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
2021 |
2020 |
2021 |
2020 |
|||||||||||||
Revenues: |
||||||||||||||||
Lease rental income - owned fleet |
$ |
172,448 |
$ |
128,648 |
$ |
326,871 |
$ |
258,720 |
||||||||
Lease rental income - managed fleet |
14,986 |
16,126 |
29,807 |
31,532 |
||||||||||||
Lease rental income |
187,434 |
144,774 |
356,678 |
290,252 |
||||||||||||
Management fees - non-leasing |
1,112 |
544 |
2,148 |
2,028 |
||||||||||||
Trading container sales proceeds |
8,730 |
7,427 |
16,341 |
17,012 |
||||||||||||
Cost of trading containers sold |
(4,499) |
(6,856) |
(9,944) |
(15,792) |
||||||||||||
Trading container margin |
4,231 |
571 |
6,397 |
1,220 |
||||||||||||
Gain on sale of owned fleet containers, net |
18,836 |
5,640 |
31,194 |
11,434 |
||||||||||||
Operating expenses: |
||||||||||||||||
Direct container expense - owned fleet |
5,787 |
15,248 |
12,584 |
28,512 |
||||||||||||
Distribution expense to managed fleet container investors |
13,524 |
14,692 |
27,019 |
28,855 |
||||||||||||
Depreciation expense |
70,015 |
63,848 |
135,821 |
130,682 |
||||||||||||
Amortization expense |
688 |
557 |
1,488 |
1,121 |
||||||||||||
General and administrative expense |
10,820 |
9,866 |
21,720 |
20,004 |
||||||||||||
Bad debt (recovery) expense, net |
(83) |
(276) |
(1,210) |
1,769 |
||||||||||||
Container lessee default expense (recovery), net |
855 |
(1,671) |
(3,113) |
(1,683) |
||||||||||||
Total operating expenses |
101,606 |
102,264 |
194,309 |
209,260 |
||||||||||||
Income from operations |
110,007 |
49,265 |
202,108 |
95,674 |
||||||||||||
Other (expense) income: |
||||||||||||||||
Interest expense |
(30,147) |
(30,022) |
(59,253) |
(66,134) |
||||||||||||
Write-off of unamortized debt issuance costs and bond discounts |
(2,945) |
— |
(3,212) |
(122) |
||||||||||||
Interest income |
26 |
56 |
63 |
456 |
||||||||||||
Realized loss on financial instruments, net |
(2,448) |
(3,267) |
(5,404) |
(4,793) |
||||||||||||
Unrealized gain (loss) on financial instruments, net |
1,406 |
1,342 |
4,598 |
(13,595) |
||||||||||||
Other, net |
25 |
(3) |
140 |
(56) |
||||||||||||
Net other expense |
(34,083) |
(31,894) |
(63,068) |
(84,244) |
||||||||||||
Income before income taxes |
75,924 |
17,371 |
139,040 |
11,430 |
||||||||||||
Income tax benefit (expense) |
117 |
(1,074) |
(949) |
(241) |
||||||||||||
Net income |
76,041 |
16,297 |
138,091 |
11,189 |
||||||||||||
Less: Dividends on preferred shares |
2,246 |
— |
2,246 |
— |
||||||||||||
Less: Net income (loss) attributable to the noncontrolling interest |
— |
308 |
— |
(421) |
||||||||||||
Net income attributable to common shareholders |
$ |
73,795 |
$ |
15,989 |
$ |
135,845 |
$ |
11,610 |
||||||||
Net income attributable to common shareholders per share: |
||||||||||||||||
Basic |
$ |
1.48 |
$ |
0.30 |
$ |
2.72 |
$ |
0.21 |
||||||||
Diluted |
$ |
1.45 |
$ |
0.30 |
$ |
2.67 |
$ |
0.21 |
||||||||
Weighted average shares outstanding (in thousands): |
||||||||||||||||
Basic |
49,855 |
53,715 |
50,002 |
55,084 |
||||||||||||
Diluted |
50,790 |
53,776 |
50,839 |
55,148 |
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES Consolidated Balance Sheets (Unaudited) (All currency expressed in |
||||||||
|
|
|||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ |
326,514 |
$ |
131,018 |
||||
Marketable securities |
2,000 |
— |
||||||
Accounts receivable, net of allowance of |
127,245 |
108,578 |
||||||
Net investment in finance leases, net of allowance of |
98,590 |
78,459 |
||||||
Container leaseback financing receivable, net of allowance of |
28,916 |
27,076 |
||||||
Trading containers |
1,803 |
9,375 |
||||||
Containers held for sale |
7,768 |
15,629 |
||||||
Prepaid expenses and other current assets |
13,202 |
13,713 |
||||||
Due from affiliates, net |
2,227 |
1,509 |
||||||
Total current assets |
608,265 |
385,357 |
||||||
Restricted cash |
74,464 |
74,147 |
||||||
Marketable securities |
3,210 |
— |
||||||
Containers, net of accumulated depreciation of |
4,581,096 |
4,125,052 |
||||||
Net investment in finance leases, net of allowance of |
1,198,521 |
801,501 |
||||||
Container leaseback financing receivable, net of allowance of |
327,791 |
336,792 |
||||||
Fixed assets, net of accumulated depreciation of |
536 |
746 |
||||||
Intangible assets, net of accumulated amortization of |
1,231 |
2,719 |
||||||
Derivative instruments |
1,754 |
47 |
||||||
Deferred taxes |
1,154 |
1,153 |
||||||
Other assets |
14,165 |
13,862 |
||||||
Total assets |
$ |
6,812,187 |
$ |
5,741,376 |
||||
Liabilities and Equity |
||||||||
Current liabilities: |
||||||||
Accounts payable and accrued expenses |
$ |
23,205 |
$ |
24,385 |
||||
Container contracts payable |
343,236 |
231,647 |
||||||
Other liabilities |
3,983 |
2,288 |
||||||
Due to container investors, net |
23,514 |
18,697 |
||||||
Debt, net of unamortized costs of |
294,895 |
408,365 |
||||||
Total current liabilities |
688,833 |
685,382 |
||||||
Debt, net of unamortized costs of |
4,533,681 |
3,706,979 |
||||||
Derivative instruments |
9,722 |
29,235 |
||||||
Income tax payable |
10,304 |
10,047 |
||||||
Deferred taxes |
7,559 |
6,491 |
||||||
Other liabilities |
34,904 |
16,524 |
||||||
Total liabilities |
5,285,003 |
4,454,658 |
||||||
Equity: |
||||||||
|
||||||||
7.00% Series A fixed-to-floating rate cumulative redeemable perpetual preferred shares, |
150,000 |
— |
||||||
Common shares, |
590 |
587 |
||||||
|
(115,432) |
(86,239) |
||||||
Additional paid-in capital |
424,779 |
416,609 |
||||||
Accumulated other comprehensive loss |
(7,431) |
(9,744) |
||||||
Retained earnings |
1,074,678 |
938,395 |
||||||
|
1,527,184 |
1,259,608 |
||||||
Noncontrolling interest |
— |
27,110 |
||||||
Total equity |
1,527,184 |
1,286,718 |
||||||
Total liabilities and equity |
$ |
6,812,187 |
$ |
5,741,376 |
||||
TEXTAINER GROUP HOLDINGS LIMITED AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) (All currency expressed in |
||||||||||
Six Months Ended |
||||||||||
2021 |
2020 |
|||||||||
Cash flows from operating activities: |
||||||||||
Net income |
$ |
138,091 |
$ |
11,189 |
||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||
Depreciation expense |
135,821 |
130,682 |
||||||||
Bad debt (recovery) expense, net |
(1,210) |
1,769 |
||||||||
Container recovery from lessee default, net |
(5,753) |
(1,558) |
||||||||
Unrealized (gain) loss on financial instruments, net |
(4,598) |
13,595 |
||||||||
Amortization and write-off of unamortized debt issuance costs and |
7,788 |
4,210 |
||||||||
Amortization of intangible assets |
1,488 |
1,121 |
||||||||
Gain on sale of owned fleet containers, net |
(31,194) |
(11,434) |
||||||||
Share-based compensation expense |
2,716 |
2,145 |
||||||||
Receipt of marketable securities on legal settlement |
(5,789) |
— |
||||||||
Changes in operating assets and liabilities |
36,654 |
36,501 |
||||||||
Total adjustments |
135,923 |
177,031 |
||||||||
Net cash provided by operating activities |
274,014 |
188,220 |
||||||||
Cash flows from investing activities: |
||||||||||
Purchase of containers and fixed assets |
(962,729) |
(52,660) |
||||||||
Payment on container leaseback financing receivable |
(6,425) |
(9,919) |
||||||||
Proceeds from sale of containers and fixed assets |
62,479 |
62,920 |
||||||||
Receipt of principal payments on container leaseback financing receivable |
15,278 |
10,310 |
||||||||
Net cash (used in) provided by investing activities |
(891,397) |
10,651 |
||||||||
Cash flows from financing activities: |
||||||||||
Proceeds from debt |
2,706,774 |
41,800 |
||||||||
Principal payments on debt |
(1,986,861) |
(195,676) |
||||||||
Payment of debt issuance costs |
(14,469) |
(57) |
||||||||
Proceeds from container leaseback financing liability, net |
11,534 |
— |
||||||||
Principal repayments on container leaseback financing liability, net |
(227) |
(12,682) |
||||||||
Issuance of preferred shares, net of underwriting discount |
145,275 |
— |
||||||||
Purchase of treasury shares |
(29,193) |
(29,082) |
||||||||
Issuance of common shares upon exercise of share options |
3,924 |
— |
||||||||
Dividends paid on preferred shares |
(1,808) |
— |
||||||||
Purchase of noncontrolling interest |
(21,500) |
— |
||||||||
Other |
(212) |
— |
||||||||
Net cash provided by (used in) financing activities |
813,237 |
(195,697) |
||||||||
Effect of exchange rate changes |
(41) |
(102) |
||||||||
Net increase in cash, cash equivalents and restricted cash |
195,813 |
3,072 |
||||||||
Cash, cash equivalents and restricted cash, beginning of the year |
205,165 |
277,905 |
||||||||
Cash, cash equivalents and restricted cash, end of the period |
$ |
400,978 |
$ |
280,977 |
||||||
Use of Non-GAAP Financial Information
To supplement
Management believes that adjusted net income and adjusted net income per diluted common share are useful in evaluating
Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures are included in the tables below for the three and six months ended
Non-GAAP measures are not financial measures calculated in accordance with GAAP and are presented solely as supplemental disclosures. Non-GAAP measures have limitations as analytical tools, and should not be relied upon in isolation, or as a substitute to net income, income from operations, cash flows from operating activities, or any other performance measures derived in accordance with GAAP. Some of these limitations are:
- They do not reflect cash expenditures, or future requirements, for capital expenditures or contractual commitments;
- They do not reflect changes in, or cash requirements for, working capital needs;
- Adjusted EBITDA does not reflect interest expense or cash requirements necessary to service interest or principal payments on debt;
- Although depreciation expense and container impairment are a non-cash charge, the assets being depreciated may be replaced in the future, and neither adjusted EBITDA, adjusted net income or adjusted net income per diluted common share reflects any cash requirements for such replacements;
- They are not adjusted for all non-cash 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, |
Six Months Ended, |
||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||
(Dollars in thousands) |
(Dollars in thousands) |
||||||||||||||||||||
(Unaudited) |
(Unaudited) |
||||||||||||||||||||
Reconciliation of adjusted net income: |
|||||||||||||||||||||
Net income attributable to common shareholders |
$ |
73,795 |
$ |
62,050 |
$ |
15,989 |
$ |
135,845 |
$ |
11,610 |
|||||||||||
Adjustments: |
|||||||||||||||||||||
Write-off of unamortized debt issuance costs and bond discounts |
2,945 |
267 |
— |
3,212 |
122 |
||||||||||||||||
Unrealized (gain) loss on financial instruments, net |
(1,406) |
(3,192) |
(1,342) |
(4,598) |
13,595 |
||||||||||||||||
Impact of reconciling items on income tax |
(130) |
27 |
13 |
(103) |
(137) |
||||||||||||||||
Impact of reconciling items attributable to the |
— |
— |
134 |
— |
(694) |
||||||||||||||||
Adjusted net income |
$ |
75,204 |
$ |
59,152 |
$ |
14,794 |
$ |
134,356 |
$ |
24,496 |
|||||||||||
Adjusted net income per diluted common share |
$ |
1.48 |
$ |
1.16 |
$ |
0.28 |
$ |
2.64 |
$ |
0.44 |
|||||||||||
Three Months Ended, |
Six Months Ended, |
|||||||||||||||||||
|
|
|
|
|
||||||||||||||||
(Dollars in thousands) |
(Dollars in thousands) |
|||||||||||||||||||
(Unaudited) |
(Unaudited) |
|||||||||||||||||||
Reconciliation of adjusted EBITDA: |
||||||||||||||||||||
Net income attributable to common shareholders |
$ |
73,795 |
$ |
62,050 |
$ |
15,989 |
$ |
135,845 |
$ |
11,610 |
||||||||||
Adjustments: |
||||||||||||||||||||
Interest income |
(26) |
(37) |
(56) |
(63) |
(456) |
|||||||||||||||
Interest expense |
30,147 |
29,106 |
30,022 |
59,253 |
66,134 |
|||||||||||||||
Write-off of unamortized debt issuance costs and bond discounts |
2,945 |
267 |
— |
3,212 |
122 |
|||||||||||||||
Realized loss on financial instruments, net |
2,448 |
2,956 |
3,267 |
5,404 |
4,793 |
|||||||||||||||
Unrealized (gain) loss on financial instruments, net |
(1,406) |
(3,192) |
(1,342) |
(4,598) |
13,595 |
|||||||||||||||
Income tax (benefit) expense |
(117) |
1,066 |
1,074 |
949 |
241 |
|||||||||||||||
Net income (loss) attributable to the noncontrolling interest |
— |
— |
308 |
— |
(421) |
|||||||||||||||
Depreciation expense |
70,015 |
65,806 |
63,848 |
135,821 |
130,682 |
|||||||||||||||
Container recovery from lessee default, net |
(41) |
(5,712) |
(1,557) |
(5,753) |
(1,558) |
|||||||||||||||
Amortization expense |
688 |
800 |
557 |
1,488 |
1,121 |
|||||||||||||||
Impact of reconciling items attributable to the |
— |
— |
(2,133) |
— |
(5,447) |
|||||||||||||||
Adjusted EBITDA |
$ |
178,448 |
$ |
153,110 |
$ |
109,977 |
$ |
331,558 |
$ |
220,416 |
||||||||||
Three Months Ended, |
Six Months Ended, |
|||||||||||||||||||||
|
|
|
|
|
||||||||||||||||||
(Dollars in thousands) |
(Dollars in thousands) |
|||||||||||||||||||||
(Unaudited) |
(Unaudited) |
|||||||||||||||||||||
Reconciliation of headline earnings: |
||||||||||||||||||||||
Net income attributable to common shareholders |
$ |
73,795 |
$ |
62,050 |
$ |
15,989 |
$ |
135,845 |
$ |
11,610 |
||||||||||||
Adjustments: |
||||||||||||||||||||||
Container impairment (recovery) |
254 |
(6,551) |
1,197 |
(6,297) |
5,783 |
|||||||||||||||||
Impact of reconciling items on income tax |
(2) |
61 |
(12) |
59 |
(58) |
|||||||||||||||||
Impact of reconciling items attributable to the noncontrolling interest |
— |
— |
(43) |
— |
(158) |
|||||||||||||||||
Headline earnings |
$ |
74,047 |
$ |
55,560 |
$ |
17,131 |
$ |
129,607 |
$ |
17,177 |
||||||||||||
Headline earnings per basic common share |
$ |
1.49 |
$ |
1.11 |
$ |
0.32 |
$ |
2.59 |
$ |
0.31 |
||||||||||||
Headline earnings per diluted common share |
$ |
1.46 |
$ |
1.09 |
$ |
0.32 |
$ |
2.55 |
$ |
0.31 |
||||||||||||
View original content:https://www.prnewswire.com/news-releases/textainer-group-holdings-limited-reports-second-quarter-2021-results-301349693.html
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