Investor Presentaiton
GAAP Returns Accelerate as Lease Portfolio Matures
Attractive investment attributes:
•
•
Book Values depreciate over 35+ years
Lease revenues generally rise over the
life of the railcar due to:
•
.
•
Inflation
Low technological obsolescence
Healthy residual values
Financial performance measures:
GAAP Returns - accelerate over time
as rent inflation diverges from original
cost
Measures earnings power relative to book
value of investment
Economic Returns – increase over time
but are more stable as residual values
benefit from inflation
Measures cash flow relative to residual
value invested
TRINITY INDUSTRIES
Railcar Book Value
Illustrative Example of Book Value and Cash Flows*
$80,000
$8,000
$70,000
$7,000
$60,000
$6,000
$50,000
$5,000
$40,000
$30,000
$20,000
$4,000
$3,000
$2,000
$10,000
$-
$1,000
$0
1 yr
Railcar Age in Years
35 yrs
Net Book Value
Rent
-
-Maintenance
Interest Expense
Healthy Returns Relative to Life-cycle Expectations*
Operational Cash Flows
35%
Return Performance
30%
25%
20%
15%
10%
5%
Railcar Age
0%
1
3 5 7 9 11 13 15 17
Annual GAAP ROA
19 21 23 25
27 29
Annual GAAP ROE
Avg. GAAP ROA over Life of Asset
Avg. GAAP ROE over Life of Asset
*See appendix for footnotes
DELIVERING GOODS for THE GOOD of ALL
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