- Board of Directors declares quarterly dividend of $.20 per common share,
reduced from $.32 per common share in the prior quarter
CHICAGO, Jan. 30 /PRNewswire-FirstCall/ -- GATX Corporation (NYSE: GMT)
today announced its 2003 fourth quarter and full year results. For the 2003
fourth quarter, GATX reported net income of $27.6 million or $.55 per diluted
share compared to a net loss of $29.4 million or $.61 per diluted share in the
prior year period. For the full year, GATX reported 2003 net income of
$76.9 million or $1.56 per diluted share compared to net income of $.3 million
in 2002.
The 2003 fourth quarter results include the following significant items on
a per diluted share basis: tax adjustments ($.22 benefit) and air-related
impairments ($.04 negative). The full year 2003 results include the
following significant items on a per diluted share basis: tax adjustments
($.24 benefit), insurance recoveries ($.20 benefit) and air-related
impairments and charges ($.19 negative).
The 2002 fourth quarter results include the following items on a per
diluted share basis: air-related impairments and charges ($.37 negative),
reduction in workforce charges ($.21 negative), and a venture-related goodwill
charge ($.17 negative). The 2002 full year results include the aforementioned
items and a SFAS No. 142 goodwill charge ($.72 negative) and a gain on a sale
of remaining GATX Terminals assets ($.13 benefit).
Ronald H. Zech, chairman and president of GATX, stated, "Entering 2003 we
expected challenging conditions in our end markets to persist, but we were
hopeful that the volatility we faced in recent years would subside. This
outlook proved accurate, and today we are experiencing a slow recovery and a
more stable environment.
"Rail utilization improved from 91% to 93% in 2003, as we scrapped cars
and effectively managed our lease renewals and new car placements. We
acquired 2,400 cars for our North American fleet, and streamlined our European
operations following the acquisition of the remaining 51% interest in KVG at
the end of 2002. The downward trend in absolute lease rates recently abated;
however, we continue to face revenue pressure in our North American fleet as
some leases renew at lower rates.
"The air industry continued to face a very difficult environment in 2003,
as the war in Iraq and SARS presented new challenges. However, traffic
patterns have improved and the pace of carrier bankruptcies and restructurings
has slowed. While lease rates on quality aircraft have bottomed out, and we
have maintained high asset utilization, material improvements in rates have
not yet occurred.
"GATX's strong cash flow characteristics were evident again in 2003. We
generated cash from operations totaling $408 million and portfolio proceeds of
$760 million. Investments for 2003 were $875 million, down from 2002 levels
primarily due to fewer aircraft deliveries. Investment activity in 2003
improved as the year progressed.
"Looking at 2004, in our rail and air businesses, which comprise nearly
80% of our asset base, we expect that underlying market conditions will
continue to improve. However, the pace of our earnings recovery is likely to
be gradual due to the long-term nature of the leases in our portfolio and
continuing pressure on lease rates. Some higher rate leases will renew at
lower rates, and improvements we are experiencing in some assets types will
work into the portfolio over time. Therefore, on a combined basis, we expect
the 2004 income contribution from our two largest businesses to be in the same
range as 2003.
"Our investment volume in technology has mirrored the restrained IT
spending environment in recent years, and as a result our asset base is lower
today than at the beginning of 2003. This presents a revenue challenge as we
enter the new year, and income from this unit is expected to decline in 2004
as we rebuild the asset base. While we expect our specialty portfolio to
contribute another strong year in terms of remarketing gains in 2004, we
expect total income from specialty and venture will be lower in 2004 versus
the prior year. This is the result of the ongoing run off of our venture
portfolio and curtailment of new investment in specialty.
"We remain focused on increasing investment volume and reducing costs
across GATX, both of which can mitigate some of the near-term revenue
pressure. Additionally, there are non-operating events unique to 2004,
including the sale of non-operating assets, that could contribute significant
income. However, the predictability of these non-operating components is
uncertain.
"Incorporating all of these factors, we currently expect that 2004 net
income will be in the same range as the $1.56 reported in 2003. This outlook
assumes no material change in trends for the economy or our major end markets.
"On a longer-term basis, the stage is set for improved financial
performance. In rail, we are seeing a more active investment environment. We
plan to add cars through both new car purchases and fleet acquisitions, and we
are actively pursuing transactions in the North America market. In air, we
successfully placed our 2003 new aircraft deliveries and renewals with minimal
downtime. The bulk of our new delivery schedule is complete, and we are now
focusing greater attention on secondary market transactions and expanding our
portfolio of managed aircraft. In technology, investment volumes have been
low but improved each quarter in 2003 as industry-wide IT spending showed
signs of recovering. Our balance sheet is solid, financing costs have
decreased dramatically over the past year, and our overall liquidity position
remains strong."
Mr. Zech concluded, "Like many of our customers, we have put a volatile
operating period behind us, we have established a firm base in a more stable
environment, and we are eager to capitalize on investment opportunities and
improve our earnings performance as our end markets strengthen."
DIVIDEND ANNOUNCEMENT
GATX also announced that the Board of Directors declared a quarterly
dividend of $.20 per common share, payable March 31, 2004, to shareholders of
record on March 5, 2004. This quarterly dividend is reduced from the prior
quarter level of $.32 per common share.
Mr. Zech stated, "In 2003, the Board held the dividend flat as it balanced
a number of competing issues: earnings were weak, the operating environment
was volatile, and the timing and magnitude of an economic recovery were
uncertain. We noted in January 2003 that the dividend level was unsustainable
based on expected earnings levels for the year. However, making a long-term
dividend decision in the face of uncertainty and volatility was not optimal,
and cash flows were strong and investment needs were moderate. Therefore, we
maintained the dividend at then current levels while we progressed toward a
more normalized operating environment in which we could better gauge the
economic recovery and its impact on GATX.
"During 2003 our operating environment stabilized and we can now look
forward with improved clarity. As noted above, the economic recovery is
underway and we are seeing positive affects on our business, but the pace of
our earnings recovery will be gradual. Therefore, while our cash flows and
liquidity position remain very strong, the Board believes the new dividend
level better reflects current earnings and recovery expectations. The new
dividend level provides GATX with the equity formation to continue
capitalizing on investment opportunities in its businesses while also
strengthening its financial position.
"The importance of the dividend to our many long term shareholders weighed
heavily in our decision process. Few companies share GATX's record of paying
quarterly, uninterrupted dividends since 1919. We are proud of this record
and believe it exemplifies our commitment to shareholders. Most importantly,
our objective remains clear: to provide shareholders with an attractive total
return on their investment in GATX, generated both from dividends and growth
in our core earnings. We believe the new dividend level sets a base from
which we can achieve this objective."
The Board also declared a quarterly dividend of $.625 per share on the
$2.50 preferred stock, payable March 1, 2004, to shareholders of record on
February 13, 2004. This quarterly dividend is unchanged from the prior
quarter.
GATX RAIL
GATX Rail reported net income of $12.3 million in the 2003 fourth quarter
compared to $6.3 million in the prior year period. For the full year, 2003
net income was $48.4 million compared to $16.3 million in the prior year. The
2003 fourth quarter and full year results include a tax adjustment benefit of
$1.8 million after-tax. The 2002 full year net income results include a
$34.9 million after-tax SFAS No. 142 goodwill charge related to DEC, GATX's
tank car leasing company based in Poland.
GATX Rail's North American fleet was 105,000 cars at year end. In the
2003 fourth quarter, GATX Rail expanded its fleet through the acquisition of
1,200 covered hopper cars that are on long-term lease with a customer.
Utilization of GATX Rail's North American fleet was 93% at the end of the
fourth quarter, flat with the third quarter but up from 91% at the end of
2002. The improvement in utilization was driven by car scrapping and
marketing programs targeted at specific car types.
Although North American utilization and the active car count increased in
2003, lease revenues in this market declined. This was driven by the fact
that, excluding the 1,200 car acquisition undertaken at year end, the North
American active car count in 2003 was slightly below the 2002 year-end level.
Fewer cars generating lease income, coupled with continued pressure on rates,
resulted in a $31 million decline (5%) in North American lease revenue versus
the prior year. The magnitude of rate pressure on the most common car types
eased in 2003 versus the beginning of the year and the prior year. This was
evidenced by the run rate of North American quarterly lease revenue which has
recently flattened out versus steady declines in 2002 and early 2003.
Maintenance costs in North America were higher in 2003 due to an increase
in assignment activity, or transferring cars from one customer to another at
lease termination, a common occurrence when industry-wide utilization levels
are lower than normal.
Order backlogs at railcar manufacturers reached the 30,000 car level in
2003 for the first time in several years, a sign of expected improvement in
the overall rail market and increased capital investment in this sector. GATX
Rail has positioned itself to acquire new cars at attractive prices through
its committed purchase program. Under this program, GATX Rail took delivery
of approximately 1,000 new cars in 2003 and demand for these cars was strong.
GATX Rail will continue looking for additional investment opportunities both
in new and used equipment.
North America manufacturing capacity utilization, as reported by the
Federal Reserve, was 76% at year end, up from 75% in the prior quarter and
prior year end. Additionally, industry-wide chemical car load shipments were
up 1.6% in 2003 compared to the prior year. The capacity utilization and
chemical shipment data are less robust than data for other sectors of the
economy.
FINANCIAL SERVICES
Financial Services reported 2003 fourth quarter net income of $14.5
million compared to a net loss of $31.1 million in the prior year period. The
2003 fourth quarter results include $2.4 million of after-tax charges for air-
related impairments. The 2002 fourth quarter results include significant
after-tax expense items including air-related impairments and charges ($18.1
million), a work-force reduction charge ($9.1 million), and goodwill
impairment ($8.7 million).
For the 2003 full year, Financial Services reported net income of $44.4
million compared to net income of $3.2 million in the prior year. The 2003
results include significant after-tax items including air-related impairments
and charges ($9.5 million negative) and insurance recoveries ($10.0 million
benefit). The 2002 full year results include the significant items outlined
in the preceding paragraph. The 2003 full year results reflect weak
performance in air, offset by solid income contributions from GATX Technology
and the specialty portfolio.
A complete air presentation has been posted at http://www.gatx.com. Highlights
include continued strong utilization at 97%, and significant progress on the
2004 renewal schedule and new aircraft placements.
Financial Services' investment volume for 2003 totaled $625 million
compared to $1.2 billion in the prior year. The two largest contributors to
investment volume in both years were the air and technology sectors. The
decline in 2003 investment volume primarily reflects the fact that GATX Air
took delivery of fewer aircraft in 2003 than prior years, along with lower
volumes as a result of the runoff of the venture business and curtailment of
specialty investments.
Remarketing income, comprised of both gains on asset sales and residual
sharing fees, was $17 million in the fourth quarter compared to $14 million in
the prior year period. Total 2003 remarketing income of $44 million compares
to $50 million in the prior year. Similar to 2002, the 2003 gains were
largely concentrated in the specialty and technology portfolios.
CREDIT STATISTICS
At the end of 2003, the allowance for losses was 6.1% of reservable assets
compared to 6.6% at the end of 2002 and 7.1% at the end of the third quarter.
Overall credit quality in the technology, specialty, and venture portfolios
improved meaningfully in 2003. Actual loss experience was less than
anticipated in 2003, and the status of certain problem and past due accounts
improved during the year. This necessitated a reduction in the loss allowance
on an absolute basis, yet the Company continues to maintain an overall loss
allowance position at the high end of its stated target range of 4.0%-6.5%.
Net charge-offs and impairments totaled $67.2 million during 2003, or 0.9%
of average total assets, compared to $97.1 million (1.3%) in 2002. The 2003
charges in the technology, specialty, and venture areas were below 2002
levels, underscoring the overall improvement in credit trends.
Non-performing leases and loans at the end of 2003 totaled $84.3 million
or 3.3% of Financial Services' investments compared to $94.9 million (3.3%) at
the end of 2002 and $149 million (5.5%) in the 2003 third quarter. The sharp
improvement in the 2003 year-end level versus the third quarter is primarily
related to repossession of certain assets, including an aircraft that was
subsequently leased to a different carrier, and favorable conclusions to
certain accounts in the technology sector.
COMPANY DESCRIPTION
GATX Corporation (NYSE: GMT) is a specialized finance and leasing company
combining asset knowledge and services, structuring expertise, partnering and
risk capital to provide business solutions to customers and partners
worldwide. GATX specializes in railcar and locomotive leasing, aircraft
operating leasing, and information technology leasing.
TELECONFERENCE INFORMATION
GATX Corporation will host a teleconference to discuss year end quarter
results. Teleconference details are as follows:
Friday, January 30th
11:00 AM Eastern Time
Domestic Dial-In: 1-800-706-6082
International Dial-In: 1-706-634-7421
Replay: Domestic: 1-800-642-1687
International: 1-706-645-9291
Access Code: 5068586
Call in details and real-time audio access are available at http://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 http://www.gatx.com or by calling the GATX Investor
Relations Department.
FORWARD-LOOKING STATEMENTS
Certain statements within this document may constitute forward-looking
statements made pursuant to the safe harbor provision of the Private
Securities Litigation Reform Act 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 in GATX Financial
Corporation'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; dynamics affecting customers within the
chemical, petroleum and food industries; regulatory rulings that may impact
the economic value of assets; competitors in the rail and air markets who may
have access to capital at lower costs than GATX; additional potential write-
downs and/or provisions within GATX's portfolio; impaired asset 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 http://www.gatx.com.
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Millions, Except Per Share Data)
Three Months Ended Twelve Months Ended
December 31 December 31
2003 2002 2003 2002
Gross Income
Lease income $ 237.3 $ 251.3 $ 956.8 $1,020.2
Marine operating revenue 28.0 26.0 85.0 79.7
Interest income 10.9 11.5 41.8 55.1
Asset remarketing income 17.7 14.3 48.7 54.7
Gain on sale of securities 1.0 .5 7.3 3.9
Fees 3.3 4.5 18.1 17.6
Other 17.1 16.4 85.0 55.3
Revenues 315.3 324.5 1,242.7 1,286.5
Gain on extinguishments
of debt 1.4 2.1 2.1 18.0
Share of affiliates'
earnings (loss) 10.3 (9.7) 69.7 48.4
Total Gross Income 327.0 316.9 1,314.5 1,352.9
Ownership Costs
Depreciation 72.1 87.5 306.5 351.6
Interest, net 46.8 56.9 199.9 224.6
Operating lease expense 45.1 45.9 182.4 179.5
Total Ownership Costs 164.0 190.3 688.8 755.7
Other Costs and Expenses
Maintenance expense 42.8 39.0 168.1 151.7
Marine operating expenses 23.0 20.6 68.9 60.7
Other operating expenses 9.3 12.5 43.6 41.1
Selling, general and
administrative 57.6 52.6 198.7 204.5
(Reversal) provision for
possible losses (5.8) 7.3 3.0 36.6
Asset impairment charges 10.8 24.9 36.4 43.2
Reduction in workforce
charges - 16.9 - 16.9
Fair value adjustments for
derivatives 1.5 .5 4.1 3.5
Total Other Costs and
Expenses 139.2 174.3 522.8 558.2
Income (Loss) from
Continuing Operations
before Income Taxes
and Cumulative
Effect of Accounting
Change 23.8 (47.7) 102.9 39.0
Income Tax (Benefit)
Provision (3.8) (18.3) 26.0 10.0
Income (Loss) from
Continuing Operations
before
Cumulative Effect of
Accounting Change 27.6 (29.4) 76.9 29.0
Discontinued Operations
Gain on sale of portion
of segment, net of taxes - - - 6.2
Total Discontinued
Operations - - - 6.2
Income (Loss) before
Cumulative Effect
of Accounting Change 27.6 (29.4) 76.9 35.2
Cumulative Effect of
Accounting Change - - - (34.9)
Net Income (Loss) $27.6 $(29.4) $ 76.9 $.3
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In Millions, Except Per Share Data)
(Continued)
Three Months Ended Twelve Months Ended
December 31 December 31
2003 2002 2003 2002
Per Share Data
Basic:
Income (loss) from
continuing operations
before cumulative effect
of accounting change $.56 $ (.61) $1.57 $ .59
Income from discontinued
operations - - - .13
Cumulative effect of
accounting change - - - (.72)
Total $.56 $(.61) $1.57 $-
Average number
of common shares
(in thousands) 49,179 48,980 49,107 48,889
Diluted:
Income (loss) from
continuing operations
before cumulative
effect of accounting
change $.55 $(.61) $1.56 $.59
Income from discontinued
operations - - - .13
Cumulative effect of
accounting change - - - (.72)
Total $.55 $(.61) $1.56 $-
Average number of common
shares and common share
equivalents
(in thousands) (a) 54,518 48,980 49,222 49,177
Dividends declared
per common share $.32 $.32 $1.28 $ 1.28
(a) Shares underlying the convertible securities issued in first quarter
of 2002 were included in the calculation of diluted earnings per
share for the fourth quarter of 2003 because of dilutive effects.
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In Millions)
December 31 December 31
2003 2002
Assets
Cash and Cash Equivalents $211.5 $231.1
Restricted Cash 60.9 140.9
Receivables
Rent and other receivables 95.9 97.8
Finance leases 561.9 713.0
Loans 187.4 434.2
Less - allowance for possible losses (51.6) (82.2)
793.6 1,162.8
Operating Lease Assets, Facilities and Other
Railcars and service facilities 3,374.6 3,076.9
Operating lease investments and other 2,332.2 2,250.1
Less - allowance for depreciation (2,109.2) (2,008.1)
3,597.6 3,318.9
Progress payments for aircraft and other equipment 53.6 140.9
3,651.2 3,459.8
Investments in Affiliated Companies 868.2 850.9
Recoverable Income Taxes 53.8 129.8
Goodwill, Net 94.8 62.5
Other Investments 101.9 96.1
Other Assets 244.7 294.4
$6,080.6 $6,428.3
Liabilities and Shareholders' Equity
Accounts Payable and Accrued Expenses $354.8 $396.2
Debt
Short-term 15.9 13.7
Long-term:
Recourse 3,255.9 3,487.9
Nonrecourse 445.6 594.6
Capital lease obligations 122.4 143.7
3,839.8 4,239.9
Deferred Income Taxes 671.7 637.4
Other Liabilities 325.4 354.2
Total Liabilities 5,191.7 5,627.7
Total Shareholders' Equity 888.9 800.6
$6,080.6 $6,428.3
GATX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(In Millions)
Three Months Ended Twelve Months Ended
December 31 December 31
2003 2002 2003 2002
Operating Activities
Income (loss) from
continuing operations,
including accounting
change $27.6 $(29.4) $76.9 $(5.9)
Adjustments to reconcile
income from continuing
operations to net cash
provided by continuing
operations:
Realized gains on
remarketing of leased
equipment (15.9) (9.5) (42.0) (40.8)
Gain on sales of
securities (1.0) (.5) (7.3) (3.9)
Depreciation 75.7 92.1 321.8 368.1
(Reversal) provision for
possible losses (5.8) 7.3 3.0 36.6
Asset impairment charges 10.8 24.9 36.4 43.2
Deferred income taxes (10.7) 23.4 60.6 130.7
Gain on extinguishments
of debt (1.4) (2.1) (2.1) (18.0)
Share of affiliates'
earnings, net of
dividends (3.4) 23.1 (49.0) (13.1)
Cumulative effect of
accounting change - - - 34.9
Other 7.3 31.3 10.0 (115.7)
Net cash provided by
continuing operations 83.2 160.6 408.3 416.1
Investing Activities
Additions to equipment
on lease, net of
nonrecourse financing
for leveraged leases,
operating lease assets
and facilities (178.3) (230.9) (642.2) (893.2)
Loans extended (.9) (37.8) (49.5) (128.7)
Investments in
affiliated companies (51.8) (62.3) (100.8) (93.3)
Progress payments (6.1) (19.5) (32.2) (104.2)
Investment in available
for sale securities (23.7) - (23.7) -
Other investments (1.4) (33.9) (26.6) (52.4)
Portfolio investments
and capital additions (262.2) (384.4) (875.0) (1,271.8)
Portfolio proceeds 191.3 209.6 759.5 882.8
Proceeds from other
asset sales 3.9 5.4 23.0 17.4
Net decrease (increase)
in restricted cash 47.7 (7.7) (28.4) (6.5)
Effect of exchange rate
changes on restricted cash - 3.3 17.7 9.9
Net cash used in
investing activities of
continuing operations (19.3) (173.8) (103.2) (368.2)
Financing Activities
Net proceeds from
issuance of long-term
debt 262.4 213.4 836.9 1,518.1
Repayment of long-term
debt (235.3) (219.3) (1,082.0) (1,210.0)
Net (decrease)
increase in short-term
debt (17.5) 13.1 (.7) (274.4)
Net decrease in capital
lease obligations (1.3) (1.6) (21.3) (22.1)
Issuance of common stock
and other 2.1 4.0 3.8 8.4
Cash dividends (15.7) (15.6) (62.8) (62.5)
Net cash used in
financing activities
of continuing operations (5.3) (6.0) (326.1) (42.5)
Effect of Exchange Rates
on Cash and Cash
Equivalents .8 3.2 1.4 13.7
Net Transfers to
Discontinued Operations - (1.2) - (14.1)
Net Increase (Decrease)
in Cash and Cash
Equivalents from
Continuing Operations 59.4 (17.2) (19.6) 5.0
Proceeds from Sale of a
Portion of Segment - - - 3.2
Net Increase (Decrease)
in Cash and Cash
Equivalents $59.4 $(17.2) $(19.6) $ 8.2
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Twelve Months Ended December 31, 2003
(In Millions)
GATX Financial Corporate GATX
Rail Services and Other Consolidated
Gross Income
Lease income $635.6 $321.2 $ - $956.8
Marine operating revenue - 85.0 - 85.0
Interest income - 41.8 - 41.8
Asset remarketing income 4.7 44.0 - 48.7
Gain on sale of securities - 7.3 - 7.3
Fees 2.9 15.2 - 18.1
Other 46.6 39.1 (.7) 85.0
Revenues 689.8 553.6 (.7) 1,242.7
Gain (loss) on
extinguishment of debt - 2.5 (.4) 2.1
Share of affiliates'
earnings 12.5 57.2 - 69.7
Total Gross Income 702.3 613.3 (1.1) 1,314.5
Ownership Costs
Depreciation 117.0 189.5 - 306.5
Interest, net 64.3 120.5 15.1 199.9
Operating lease expense 174.0 8.7 (.3) 182.4
Total Ownership Costs 355.3 318.7 14.8 688.8
Other Costs and Expenses
Maintenance expense 165.5 2.6 - 168.1
Marine operating expenses - 68.9 - 68.9
Other operating expenses 33.9 9.7 - 43.6
Selling, general and
administrative 79.6 94.9 24.2 198.7
(Reversal) provision for
possible losses (2.6) 5.6 - 3.0
Asset impairment charges - 36.4 - 36.4
Fair value adjustments
for derivatives - 4.1 - 4.1
Total Other Costs and
Expenses 276.4 222.2 24.2 522.8
Income (Loss) from
Continuing Operations
before Income Taxes 70.6 72.4 (40.1) 102.9
Income Tax Provision
(Benefit) 22.2 28.0 (24.2) 26.0
Net Income (Loss) $48.4 $44.4 $(15.9) $76.9
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Twelve Months Ended December 31, 2002
(In Millions)
GATX Financial Corporate Discontinued GATX
Rail Services and Other Operations
Consolidated
Gross Income
Lease income $608.6 $411.6 $- $- $1,020.2
Marine
operating
revenue - 79.7 - - 79.7
Interest income - 55.1 - - 55.1
Asset remarketing
income 4.9 49.8 - - 54.7
Gain on sale of
securities - 3.9 - - 3.9
Fees 3.4 14.2 - - 17.6
Other 42.2 13.1 - - 55.3
Revenues 659.1 627.4 - - 1,286.5
Gain on
extinguishments
of debt - 16.8 1.2 - 18.0
Share of
affiliates'
earnings 13.1 35.3 - - 48.4
Total Gross
Income 672.2 679.5 1.2 - 1,352.9
Ownership Costs
Depreciation 105.0 246.6 - - 351.6
Interest, net 56.2 147.0 21.4 - 224.6
Operating lease
expense 171.3 8.8 (.6) - 179.5
Total Ownership
Costs 332.5 402.4 20.8 - 755.7
Other Costs and
Expenses
Maintenance
expense 150.9 .8 - - 151.7
Marine
operating
expenses - 60.7 - - 60.7
Other operating
expenses 31.7 9.4 - - 41.1
Selling,
general and
administrative 74.7 110.8 19.0 - 204.5
Provision for
possible losses 1.4 35.2 - - 36.6
Asset impairment
charges - 43.2 - - 43.2
Reduction in
workforce
charges 2.0 14.9 - - 16.9
Fair value
adjustments for
derivatives .2 3.3 - - 3.5
Total Other Costs
and Expenses 260.9 278.3 19.0 - 558.2
Income (Loss)
from Continuing
Operations
before Income
Taxes and
Cumulative
Effect of
Accounting
Change 78.8 (1.2) (38.6) - 39.0
Income Tax
Provision
(Benefit) 27.6 (4.4) (13.2) - 10.0
Income (Loss)
from Continuing
Operations
before
Cumulative
Effect of
Accounting
Change 51.2 3.2 (25.4) - 29.0
Discontinued
Operations
Gain on sale of
portion of
segment, net
of taxes - - - 6.2 6.2
Total
Discontinued
Operations - - - 6.2 6.2
Income (Loss)
before
Cumulative
Effect of
Accounting
Change 51.2 3.2 (25.4) 6.2 35.2
Cumulative
Effect of
Accounting
Change (34.9) - - - (34.9)
Net Income
(Loss) $16.3 $3.2 $(25.4) $6.2 $.3
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Three Months Ended December 31, 2003
(In Millions)
GATX Financial Corporate GATX
Rail Services and Other Consolidated
Gross Income
Lease income $ 160.0 $77.3 $- $237.3
Marine operating
revenue - 28.0 - 28.0
Interest income - 10.9 - 10.9
Asset remarketing income .3 17.4 - 17.7
Gain on sale of securities - 1.0 - 1.0
Fees .2 3.1 - 3.3
Other 11.3 6.8 (1.0) 17.1
Revenues 171.8 144.5 (1.0) 315.3
Gain (loss) on
extinguishment of debt - 1.8 (.4) 1.4
Share of affiliates'
earnings 3.8 6.5 - 10.3
Total Gross Income 175.6 152.8 (1.4) 327.0
Ownership Costs
Depreciation 30.5 41.6 - 72.1
Interest, net 15.2 27.7 3.9 46.8
Operating lease expense 43.4 2.0 (.3) 45.1
Total Ownership Costs 89.1 71.3 3.6 164.0
Other Costs and Expenses
Maintenance expense 42.5 .3 - 42.8
Marine operating expenses - 23.0 - 23.0
Other operating expenses 7.3 2.0 - 9.3
Selling, general and
administrative 23.0 25.4 9.2 57.6
(Reversal) provision for
possible losses (.9) (4.9) - (5.8)
Asset impairment charges - 10.8 - 10.8
Fair value adjustments
for derivatives (.1) 1.6 - 1.5
Total Other Costs and
Expenses 71.8 58.2 9.2 139.2
Income (Loss) from
Continuing Operations
before Income Taxes 14.7 23.3 (14.2) 23.8
Income Tax Provision
(Benefit) 2.4 8.8 (15.0) (3.8)
Net Income $12.3 $14.5 $.8 $27.6
GATX CORPORATION AND SUBSIDIARIES
SEGMENT DATA (UNAUDITED)
Three Months Ended December 31, 2002
(In Millions)
GATX Financial Corporate GATX
Rail Services and Other Consolidated
Gross Income
Lease income $150.1 $ 101.2 $- $251.3
Marine operating revenue - 26.0 - 26.0
Interest income - 11.5 - 11.5
Asset remarketing income .6 13.7 - 14.3
Gain on sale of securities - .5 - .5
Fees .7 3.8 - 4.5
Other 10.9 4.5 1.0 16.4
Revenues 162.3 161.2 1.0 324.5
Gain on extinguishments
of debt - 1.0 1.1 2.1
Share of affiliates'
earnings (loss) 4.4 (14.1) - (9.7)
Total Gross Income 166.7 148.1 2.1 316.9
Ownership Costs
Depreciation 26.2 61.3 - 87.5
Interest, net 13.3 37.3 6.3 56.9
Operating lease expense 42.6 3.9 (.6) 45.9
Total Ownership Costs 82.1 102.5 5.7 190.3
Other Costs and Expenses
Maintenance expense 38.7 .3 - 39.0
Marine operating expenses - 20.6 - 20.6
Other operating expenses 10.6 1.9 - 12.5
Selling, general and
administrative 19.3 29.4 3.9 52.6
Provision for possible
losses .5 6.8 - 7.3
Asset impairment charges - 24.9 - 24.9
Reduction in workforce
charges 2.0 14.9 - 16.9
Fair value adjustments
for derivatives (.1) .6 - .5
Total Other Costs and
Expenses 71.0 99.4 3.9 174.3
Income (Loss) from
Continuing Operations
before Income Taxes
and Cumulative
Effect of Accounting
Change 13.6 (53.8) (7.5) (47.7)
Income Tax Provision
(Benefit) 7.3 (22.7) (2.9) (18.3)
Net Income (Loss) $6.3 $ (31.1) $(4.6) $(29.4)
GATX CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION (UNAUDITED)
(In Millions, Except Railcar Data)
12/31/2003 12/31/2002
Total Assets, Excluding Cash (a) $7,099.8 $7,428.5
Reservable Assets 845.2 1,245.0
Financial Services Investments 2,532.2 2,900.9
Allowance for Losses 51.6 82.2
Allowance for Losses as a Percentage
of Reservable Assets 6.1% 6.6%
Net Charge-Offs and Asset Impairments
and Write-Downs 67.2 97.1
Net Charge-Offs/Impairments/Write-Downs
as a Percentage of Average Total Assets .9% 1.3%
Non-performing Investments 84.3 94.9
Non-performing Investments as a Percentage
of Financial Services' Investments 3.3% 3.3%
Capital Structure
Short-term Debt, Net of Unrestricted Cash (195.6) (217.4)
Long-term Debt:
On Balance Sheet
Recourse 3,255.9 3,487.9
Nonrecourse 445.6 594.6
Off Balance Sheet
Recourse 978.6 1,018.8
Nonrecourse 313.0 353.4
Capital Lease Obligations 122.4 143.7
Total Net Debt Obligations 4,919.9 5,381.0
Total Recourse Debt 4,161.3 4,433.0
Shareholders' Equity and Allowance for Losses 940.5 882.8
Recourse Leverage 4.4 5.0
Asset Remarketing Income
Disposition gains on owned assets 42.0 40.8
Residual sharing fees 6.7 13.9
48.7 54.7
Railcar Data
North American Fleet Utilization 93% 91%
Beginning Fleet Size 107,150 110,201
Additions 2,388 3,794
Scrappings (4,290) (6,845)
Ending Fleet Size 105,248 107,150
(a) Includes Off Balance Sheet Assets
SOURCE GATX Corporation
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Related links:
http://www.gatx.com
CONTACT:
Robert C. Lyons, +1-312-621-6633, or Rhonda
S. Johnson, +1-415-955-3211, both of GATX Corporation
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