UPDATE 2-Greenbrier posts surprise Q3 profit, shares up
* Q3 EPS $0.23 vs loss/shr $3.04 yr-ago
* Rev $211.5 mln vs $244.4 mln last year
* Cost of rev down 19 pct
* Margin up 34 pct
* Shares rise as much as 18 pct (Adds details, updates share movement)
July 8 (Reuters) - Railroad equipment supplier Greenbrier Cos Inc (GBX.N) posted a surprise third-quarter profit, helped by lower costs and higher margin, sending its shares up as much as 18 percent.
The company said revenue would continue to be lower in 2010 compared with 2009, and operating results for the second half of the year are expected to be stronger than the first half.
"Our railcar repair shops are also operating at higher utilization levels than earlier this year, as railcars coming out of storage are in need of repair," Chief Executive William Furman said in a statement.
Greenbrier, whose customers include Union Pacific Corp (UNP.N) and General Electric Co (GE.N), said it is seeing some improvement in end-market demand for its rail products and services.
The strong results were driven by better execution and asset sales, analyst Steve Barger of KeyBanc Capital Markets said in a note to clients.
The company said it sold railcars from its lease fleet and realized a gain of $3.1 million, positively affecting gross margins for its leasing and services segment.
In May, Greenbrier had said its unit Gunderson LLC would cut production rates at its marine barge operation due to uncertainties in the marine market, and implemented a four-day week at its operation. [ID:nSGE64R0A9]
For the third quarter ended May 31, Greenbrier reported net income of $4.6 million, or 23 cents a share, compared with a net loss of $51.1 million, or $3.04 a share, a year ago.
Excluding items, the company earned 19 cents a share, according to Thomson Reuters I/B/E/S.
Revenue for the company fell 13 percent to $211.5 million.
Cost of revenue fell 19 percent to $175.6 million. Margin rose 34 percent to $35.9 million.
Analysts on average were expecting a loss of 2 cents a share on revenue of $214 million, according to Thomson Reuters I/B/E/S.
Shares of the company touched a high of $12.70 before paring some of their gains to trade up 5 percent at $11.31 Thursday on the New York Stock Exchange. (Reporting by Megha Mandavia in Bangalore; Editing Roshni Menon)
- Exclusive: Angry with Washington, 1 in 4 Americans open to secession
- Secret Service investigates after man jumps White House fence, reaches doors
- About 60,000 Syrian Kurds flee to Turkey from Islamic State advance |
- U.S. immigration protesters drop U.S. border blockade plan
- French jets strike in Iraq, expanding U.S.-led campaign against Islamic State |