The Greenbrier Companies F1Q09 (Qtr End 11/30/08) Earnings Call Transcript

Executives

Mark Rittenbaum – Executive Vice President, Chief Financial Officer and Treasurer

Bill Furman – President, Chief Executive Officer

William Glenn – Vice President, Strategic Planning

Analysts

Frank Magdlen - The Robins Group

Wendy Caplan - Wachovia Securities

Todd Maiden - BB&T Capital Markets

Paul Bodner – Longbow Research

J.B. Groh - D.A. Davidson & Co.

Art Hetfield – Morgan Keegan

Analyst for Steve Barger - KeyBanc Capital Markets

Presentation

Operator

Welcome to the Greenbrier Company's first quarter earnings release conference call. (Operator Instructions) At this time, I would like to turn the conference over to Mr. Mark Rittenbaum, Executive Vice President, Chief Financial Officer and Treasurer.

Mr. Rittenbaum, you may begin.

Mark Rittenbaum

Good morning and welcome to our first quarter fiscal 2009 conference call. On today's call, we will discuss our results and make a few remarks about the quarter that ended on November 30. We will then provide an outlook for 2009 and beyond. After that we will open it up for questions.

As always, matters discussed in this conference call include forward-looking statements within the Private Securities Litigation Reform Act of 1995. Throughout our discussion today, we will describe some of the important factors that could cause Greenbrier's actual results in 2009 and beyond to differ materially from those expressed in the forward-looking statement made by or on behalf of Greenbrier.

Today we reported a net loss for our first quarter of $3.3 million or $0.20 per diluted share on revenues of $256 million. We also announced we are reducing our dividend from $0.08 per share to $0.04 per share.

Turning back to the quarter the results included a non-cash charge of $1.2 million pre-tax, $0.6 million after tax or $0.04 per share. The background on this is as a normal course of our business we have a policy of hedging our currency exposure over in Europe to lock in our margins on foreign currency sales. We have been doing this since we entered into European operations ten years ago. All of our hedge contracts and all of our hedging is economically effective but during the quarter we determined a small number of our contracts for technical reasons did not meet all of the requirements to be designated for hedge accounting treatment under GAAP. Therefore we are required to mark those specific contracts to market through the income statement and this resulted in a non-cash charge to interest in foreign exchange of $1.2 million. read more