NYSE: GBX May 2015 Investor Contact: Investor.Relations@gbrx.com - - PowerPoint PPT Presentation

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NYSE: GBX May 2015 Investor Contact: Investor.Relations@gbrx.com - - PowerPoint PPT Presentation

NYSE: GBX May 2015 Investor Contact: Investor.Relations@gbrx.com Website: www.gbrx.com Safe Harbor Statement UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This presentation may contain forward-looking statements, including


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SLIDE 1

NYSE: GBX

May 2015

Investor Contact: Investor.Relations@gbrx.com Website: www.gbrx.com

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SLIDE 2

Safe Harbor Statement

UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This presentation may contain forward-looking statements, including statements regarding expected new railcar production volumes and schedules, expected customer demand for the Company’s products and services, plans to increase manufacturing capacity, restructuring plans, new railcar delivery volumes and schedules, growth in demand for the Company’s railcar services and parts business, and the Company’s future financial

  • performance. Greenbrier uses words such as “anticipates,” “believes,” “forecast,” “potential,” “goal,” “contemplates,” “expects,”

“intends,” “plans,” “projects,” “hopes,” “seeks,” “estimates,” “strategy,” “could,” “would,” “should,” “likely,” “will,” “may,” “can,” “designed to,” “future,” “foreseeable future” and similar expressions to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to certain risks and uncertainties that could cause actual results to differ materially from in the results contemplated by the forward-looking statements. Factors that might cause such a difference include, but are not limited to, reported backlog and awards are not indicative of our financial results; uncertainty or changes in the credit markets and financial services industry; high levels of indebtedness and compliance with the terms of our indebtedness; write-downs of goodwill, intangibles and other assets in future periods; sufficient availability of borrowing capacity; fluctuations in demand for newly manufactured railcars or failure to obtain orders as anticipated in developing forecasts; loss of

  • ne or more significant customers; customer payment defaults or related issues; actual future costs and the availability of materials

and a trained workforce; failure to design or manufacture new products or technologies or to achieve certification or market acceptance of new products or technologies; steel or specialty component price fluctuations and availability and scrap surcharges; changes in product mix and the mix between segments; labor disputes, energy shortages or operating difficulties that might disrupt manufacturing operations or the flow of cargo; production difficulties and product delivery delays as a result of, among other matters, inefficiencies associated with expansion or start-up of production lines or increased production rates, changing technologies, transfer of production between facilities or non-performance of alliance partners, subcontractors or suppliers; ability to obtain suitable contracts for the sale of leased equipment and risks related to car hire and residual values; integration of current or future acquisitions and establishment of joint ventures; succession planning; discovery of defects in railcars

  • r services resulting in increased warranty costs or litigation; physical damage or product or service liability claims that exceed our

insurance coverage; train derailments or other accidents or claims that could subject us to legal claims; actions or inactions by various regulatory agencies including potential environmental remediation obligations or changing tank car or other rail car or railroad regulation; and issues arising from investigations of whistleblower complaints; all as may be discussed in more detail under the headings "Risk Factors" and “Forward Looking Statements” in our Annual Report on Form 10-K for the fiscal year ended August 31, 2014, and our other reports on file with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's opinions only as of the date hereof. Except as

  • therwise required by law, we do not assume any obligation to update any forward-looking statements.

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SLIDE 3

Asset-light model Owned fleet 8,300 units Managed Fleet 241,000 units

Three business units working together

Leading Integrated Transportation Equipment & Service Provider

Aftermarkets Leasing & Services Manufacturing Wheels & Parts – nine wheel service locations and four railcar part reconditioning locations GBW Railcar Services - 50/50 JV provides repair services across 34 locations Leading manufacturer of railcars in North America and Europe Leading domestic manufacturer

  • f ocean-going barges

New railcar backlog of $4.78 billion Marine backlog of ~$80 million

2

  • 500

1,000 1,500 2,000 2,500 1994 2014 $ millions

Historical Revenue

IPO IPO

Data as of 2/28/2015

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SLIDE 4

Greenbrier’s integrated business model delivers superior value to customers by creating customized freight car solutions

  • ver the entire life of a railcar.

Our diversified portfolio of quality products and services enhances

  • ur financial performance

across the business cycle.

Integrated Business Model

Leasing & Services Aftermarkets - Wheels & Parts GBW Railcar JV

Manufacturing

3

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SLIDE 5

Investment Highlights

Attractive Industry Dynamics Unique Strategic Position Strong Financial Profile

4

Robust rail cycle driven by current business and industry trends Broadening product demand across cycles Changing tank car regulatory environment Provides customized solutions Transformational initiatives create growth platform

  • Enhanced Leasing

model

  • Product & service

diversification

  • Extensive North

American aftermarket repair network

Diverse revenue and earnings stream Strong railcar backlog Positive financial trends and outlook Strategic initiatives to drive shareholder value

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SLIDE 6

30 35 40 45 50 Millions

N.A. Freight Traffic

Transportation Industry Dynamics Favor Rail

Rail significantly more fuel efficient than trucks Environmental concerns favor rail Highway congestion, driver shortage, regulation and aging highway infrastructure constrain trucking

5

Source: FTR Associates – Rail Equipment Outlook (March 2015)

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SLIDE 7

10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 2009 2010 2011 2012 2013 2014 2015F 2016F 2017F 2018F 2019F Units

North American Rail Car Deliveries

A Robust Cycle Driving New Railcar Deliveries

Shale oil and gas revolution drives early stages Changing tank car regulatory environment Broadening demand growth in:

  • Intermodal
  • Automotive loadings
  • Commodities
  • Forest products

Aging fleet Strong railroad balance sheets and capital expenditure budgets

6

Source: FTR Associates – Rail Equipment Outlook (March 2015)

Long-term average: ~50,000 units

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SLIDE 8

Demand Varies Across Cycles

7

Source: FTR Associates – Rail Equipment Outlook (March 2015)

Different car types have different cycles

10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 2011A 2012A 2013A 2014A 2015F 2016F 2017F 2018F 2019F

Covered hopper Boxcar Tanks Intermodal Flat cars (auto) Coal Other hoppers / gondolas

Long-term average: ~50,000 units

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SLIDE 9

1.35 1.45 1.55 1.65 1.75 1.85 1.95 Millions

U.S. Rail Tonmiles

Aftermarket Demand Drivers

Source: FTR Associates – Rail Equipment Outlook (March 2015)

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Wheel demand driven by stabilizing coal traffic, crude oil unit trains and intermodal traffic growth Increasing ton miles and equipment upgrades drive repair spending Approaching substantial tank car maintenance cycle Changing tank car regulatory environment

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SLIDE 10

Changing Tank Car Regulatory Environment

335,000 Total Tank Cars 272,000 DOT-111 Non-Pressurized 252,000 Pre-Petition 96,000 Non- Hazardous 58,000 Crude & Ethanol 23,000 Other Flammable 75,000 Other Hazardous 20,000 Petition 2,000 Non- Hazardous 15,000 Crude & Ethanol 3,000 Other Flammable 63,000 Pressurized

“Pre-Petition” represents tank cars ordered prior to October 2011 built to the long-established industry standard. “Petition” represents the industry standard voluntarily adopted by AAR, for cars ordered after October 2011.

Source: DOT NPRM June 2014, RSI, AAR

9

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SLIDE 11

Current Key Tank Car Differences

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Pre-petition cars reflect the current government tank car standards (adopted in 1971). Petition cars refer to the P-1577 standards that were adopted by AAR circular CPC-1232 for all cars ordered after October 1, 2011 (also known as “Good Faith” cars).

Tank Type Pre-Petition Petition Code DOT-111 CPC-1232 Effective Date (new cars) Nov-71 Oct-11 Max Gross Rail Load 263,000 286,000 Normalized Steel Heads & Shells No Yes Half-Inch Head Shields No Half or Full Height Head & Shell Thickness 7/16 inch 7/16 to 1/2 inch* Top Fittings Protection No Yes Half-Inch Ceramic Insulation No No Steel Jackets Some Some High Flow Pressure Relief Valve No Some Improved BOV Handle No No

*Depends on jacketing

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SLIDE 12

Tank Car Standard Increases Railcar Safety

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SLIDE 13

Leasing & Services Demand Drivers

Strong lease market as users seek flexibility Financial institutions seek yield and create opportunity for syndications and service contracts Trend of increasing private (“leasing/shipping companies”) railcar

  • wnership expected to continue

12

Source: AAR – Railroad Equipment Outlook (August 2014)

52% 4% 44%

2005

Railroads TTX Private

39% 4% 57%

2014

Railroads TTX Private

Historical N.A. Railcar Fleet Ownership

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SLIDE 14

Unique Strategic Position

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SLIDE 15

History of Quality and Innovation

TTX excellent supplier award for 20 years New Railcar Manufacturing – Intermodal, Automotive, ‘Tank Car of the Future’, Plastic Pellet Wheels & Parts – developing cutting edge telemetry testing to revolutionize safety & quality of wheels and axles Repair – tank car retrofits, repurposing of railcars Leasing & Services – Enhanced syndication model, proprietary fleet maintenance and management solutions and capabilities

14

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SLIDE 16

Transformational Initiatives Create Diversified Growth Platform

Improves competitive position due to diverse product mix at lower-cost, flexible manufacturing facilities Diversifies business mix by expanding repair and wheel maintenance business - large aftermarket business provides stability throughout business cycles Enhances leasing activities, capturing more value throughout the railcar life cycle Expands available market by increasing throughput and diversifying product portfolio while maintaining the quality customers demand

Greenbrier is well-positioned to benefit from numerous tailwinds. Our diversified business model leaves Greenbrier relatively well-insulated from any major potential headwinds.

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$749 $1,625 $102 $496 $92 $83

$0 $500 $1,000 $1,500 $2,000 $2,500

2006 2014

$ in millions (% of Total Revenue)

Leasing & Services WR&P Manufacturing

FY 2015 Guidance $2.6 – 2.7 billion

Initiatives Lead to Larger, Diversified Revenue Streams

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Greenbrier’s revenue has more than doubled since the prior new railcar delivery peak in 2006. $943 $2,204

(10%) (11%) (79%) (4%) (74%) (22%)

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SLIDE 18

Record Railcar Backlog ($ in millions except per unit values)

Backlog Units 5,300 15,400 10,700 14,400 31,500 46,000 In fiscal Q2, Greenbrier received orders for 10,100 railcar units valued at $1.09 billion. Year-to-date through February 28, 2015, Greenbrier has received orders for 24,200 units valued at $2.33 billion.

17

$420 $1,230 $1,200 $1,520 $3,330 $4,780 $79 $80 $112 $106 $106 $104

$- $20 $40 $60 $80 $100 $120 $- $1,000 $2,000 $3,000 $4,000 $5,000 $6,000

  • Aug. 10
  • Aug. 11
  • Aug. 12
  • Aug. 13
  • Aug. 14
  • Feb. 15

Average Sales Price/Unit ($ in thousands) Backlog Value ($ in millions)

Sixth Consecutive Quarter of Growth - Provides Strong Visibility

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SLIDE 19

March 31, 2007

March 31, 2015*

North American Railcar Backlog Comparison

(By Builder)

GBX, 14% ARI, 13%

RAIL, 8%

TRN, 48%

Others, 17%

0% 20% 40% 60% 80% 100%

100% = 79,038 units

Source: RSI ARCI, public filings

GBX, 30% ARI, 8% TRN, 41% Others, 21% 0% 20% 40% 60% 80% 100%

100% = 138,856 units

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* RAIL has not reported and is included in “Others”

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SLIDE 20

March 31, 2007 March 31, 2015

North American Railcar Backlog Comparison

(By Car Type)

Covered Hoppers, 44% Tank Cars, 38%

Flat Cars, 3% Gondolas, 3% Open Hopper, 1% Intermodal, 8%

0% 20% 40% 60% 80% 100%

100% = 138,856 units

Source: RSI ARCI, public filings

Covered Hoppers, 33% Tank Cars, 46%

Flat Cars, 2% Gondolas, 6% Open Hopper, 5% Intermodal, 8%

0% 20% 40% 60% 80% 100%

100% = 79,038 units

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SLIDE 21

$3.07 $(1.00) $- $1.00 $2.00 $3.00 $4.00 2009 2010 2011 2012 2013 2014 2015

Adjusted EPS(1)

16,200 0.0 4.0 8.0 12.0 16.0 20.0 2009 2010 2011 2012 2013 2014 2015

Deliveries (Units)

$2,204 $- $400 $800 $1,200 $1,600 $2,000 $2,400 2009 2010 2011 2012 2013 2014 2015

Revenue

Consolidated Financial Trends ($ in millions)

(1) Adjusted EPS & Adjusted EBITDA exclude Goodwill impairment, Restructuring charges and other Special Items. (2) Net debt is defined as Gross debt plus debt discount less Cash

FY 2015 Revenue = ~ $2.6 -2.7 billion FY 2015 Revenue = ~ $2.6 -2.7 billion Deliveries = ~21,500 units Deliveries = ~21,500 units FY 2015 Guidance = $5.65 – $5.95 FY 2015 Guidance = $5.65 – $5.95 We expect the positive trend to continue in FY 2015 We expect the positive trend to continue in FY 2015

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7.7x 5.5x 4.6x 2.7x 2.0x 1.1x 0.0x 2.0x 4.0x 6.0x 8.0x 2009 2010 2011 2012 2013 2014 2015

Net Debt(2) to Adj. EBITDA(1)

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SLIDE 22

$105 $105 $192 $299 $304 $321 $243 $76 $99 $50 $54 $97 $185 $146 $181 $204 $242 $353 $401 $506 $388

2009 2010 2011 2012 2013 2014 2/28/2015

7.7x 5.5x 4.6x 2.7x 2.0x 1.1x 1.2x 0.0x 2.0x 4.0x 6.0x 8.0x

2009 2010 2011 2012 2013 2014 LTM 2/28/2015

Strong Balance Sheet and Liquidity Provide Flexibility

Net Funded Debt(2) / Adjusted EBITDA(1) Liquidity Summary ($ in millions)

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(1) Adjusted EBITDA exclude gain on contribution to GBW, restructuring charges, goodwill impairment and other special items (2) Net debt is defined as funded debt less cash

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SLIDE 23

Current Financial Goals

Focus Area Goal

Gross Margin Enhancement Aggregate gross margin of at least 20% by the second half of FY 2016 Capital Efficiency Return on Invested Capital (“ROIC”) of at least 25% by the second half of FY 2016

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11.5% 16.3% 17.2% 17.8% 19.9% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% Q2 14 Q3 14 Q4 14 Q1 15 Q2 15

Aggregate Gross Margin

11.2% 27.1% 19.8% 11.0% 27.3% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Q2 14 Q3 14 Q4 14 Q1 15 Q2 15

Return on Invested Capital

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SLIDE 24

Strong balance sheet and positive free cash flow trend

Clear Path to Growth and Shareholder Value

Positive trends in average sales price and continued strength in new

  • rders

Unique model that enhances financial performance across the cycle, with powerful cross selling opportunities Initiatives to improve gross margins and capital efficiency

Solid Railcar Backlog Diversified Revenue Streams Strong Balance Sheet & Liquidity Strategic Initiatives 23

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SLIDE 25

Appendix

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2Q FY 2015 Key Metric Highlights

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15,200 26,400 31,500 41,200 46,000 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Backlog

3,400 4,300 4,800 4,000 5,200 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Total Deliveries

700 900 1,100 1,800 1,700 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Syndicated Deliveries

Backlog 46,000 units valued at $4.78 billion

  • Sixth consecutive quarter of growth
  • Received orders of 10,100 units in 2Q

valued at $1.09 billion

  • Energy related tank cars only comprise

about 15% of backlog

  • Broad range of non-energy related car

types including boxcars, medium covered hoppers, non-energy tank cars, intermodal and gondola cars

Delivery of 5,200 units

  • Record delivery levels
  • Quarterly lease syndication volume has

increased over 140% over the last year while overall deliveries have increased ~50%

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SLIDE 27

2Q FY 2015 Income Statement Highlights

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$502.2 $593.3 $618.1 $495.1 $630.1 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Revenue ($ millions)

$44.9 $78.0 $80.8 $67.2 $102.7 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Adjusted EBITDA* ($ millions)

$0.51 $1.03 $1.03 $1.01 $1.57 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Diluted EPS*

Growth in: Revenue to $630.1 million

  • Primarily driven by increased deliveries

Gross margin to 19.9%

  • Higher deliveries, favorable product mix

and pricing, and improved operating efficiencies

Adjusted EBITDA to $102.7 million

  • Increased deliveries and margin growth
  • Adjusted EBITDA margin of 16.3%

Diluted EPS to $1.57

*Excludes Restructuring charges in FY14 and gain on contribution to GBW in 4Q FY14.

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SLIDE 28

2Q FY 2015 Balance Sheet & Cash Flow Highlights

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$80.3 $14.9 $54.2 $(53.8) $46.0 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Operating Cash Flow(1) ($ millions)

$(4.6) $7.1 $33.5 $31.7 $24.8 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Net Capital Expenditure & Invest. In

  • Unconsol. Affiliates(2) ($ millions)

$254.2 $266.7 $273.3 $370.9 $386.4 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Net Funded Debt ($ millions)

Positive Operating Cash Flow

  • Strong operating performance partially offset by

increased WC needs associated with higher production and syndication volumes.

  • Available liquidity exceeds $385 million

Board declares quarterly dividend of $0.15 per share and continued execution under $75 million share repurchase program

  • In 2Q, repurchased 483,983 shares of common stock

at a cost of $23.8 million or an average price of $49.23 / share

  • $43.6 million of remaining availability under share

repurchase program

Net Funded Debt trended up reflecting working capital needs associated with higher production and lease syndication volumes, increased net capital expenditures, and continued return of capital to shareholders

(1)Excludes Restructuring charges in FY14 and gain on contribution

to GBW in 4Q FY14

(2)Investment in Unconsolidated Affiliates included to reflect GBW

Railcar JV investments

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SLIDE 29

Two Ways to Sell New Railcars

Direct Sales

Customer orders railcar to buy and use We build railcar and deliver it to customer Revenue recognized in Manufacturing segment

Lease Syndication

Customer orders railcar to lease We build railcar and lease it Railcars held temporarily on balance sheet generating interim lease income for GBX

  • Called “Railcars held for syndication” on

Balance Sheet

  • “Interim” lease income recognized in Leasing &

Services segment

Railcars aggregated and sold (“syndicated”) to multiple third party investors (non-recourse to GBX)

  • Sales price premium over direct sale from attached

lease

  • Revenue from sale recognized in Manufacturing

segment

Long term Management fees earned from investors on railcars after syndication

  • Revenue recognized in Leasing & Services segment

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Direct Lease

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SLIDE 30

Leasing & Services Supplemental Information

Fleet Information

Units

  • Feb. 28,

2014 May 31, 2014

  • Aug. 31,

2014

  • Nov. 30,

2014

  • Feb. 28,

2015 Long term owned units (“Equipment on operating lease”) 7,300 6,900 6,800 6,600 6,400 Short term owned units (“Railcars held for syndication”) 1,100 1,400 1,800 1,900 1,900 Total owned fleet 8,400 8,300 8,600 8,500 8,300 Managed fleet (units) 233,000 235,000 238,000 238,000 241,000

Owned & Managed Fleet

Owned Equipment on operating lease ‘right- sized’ over last 2 years

  • Additional monetization would be tax inefficient

with over $70 million of Deferred Taxes related to the Lease fleet

  • Secures Leasing term loan of $195 million

Managed fleet services include railcar remarketing, maintenance management, car hire accounting and various other services

  • Managed fleet has grown over 7% over last 18

months as Syndication volume increased

  • Now accounts for ~16% of North American railcar

fleet

Lease Syndication Model

Targeting ~$800 million of Syndication volume in FY 2015 One of two channels to market Dwell time of rent producing railcars on balance sheet (“Railcars held for Syndication”) averages 3 months, as railcar leases are aggregated and sold in bundles to investors In addition to premium pricing above direct sales, creates stream of multi-year management fee income Expands customer universe beyond Greenbrier’s traditional base

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SLIDE 31

Manufacturing

Quarterly Trends Quarterly Trends Revenue and Gross Margin % Revenue and Gross Margin % FY 15 Outlook FY 15 Outlook

  • Sequential revenue growth reflects higher

deliveries

  • Margin increase reflects favorable product

mix and pricing, improved efficiencies, and weakened Peso

  • Marine backlog as of February 28, 2015

totaled approximately $80.0 million

  • Deliveries of approximately 21,500 units
  • Substantial increase in deliveries through lease

syndication channel

  • Capital expenditures are expected to be

approximately $95 million in FY 2015, primarily related to capacity projects in Mexico, enhanced vertical integration and efficiency enhancements. Capacity projects include doubling of tank car capacity and moving from a leased facility to a lower cost owned facility.

($ in millions)

2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Revenues $347.8 $425.6 $492.1 $379.9 $505.2 Gross Margin $41.2 $73.8 $87.9 $63.9 $102.0 Gross Margin % 11.8% 17.3% 17.9% 16.8% 20.2% Operating Margin % 8.7% 14.4% 14.8% 13.7% 18.0% Capital Expenditures $6.2 $14.7 $31.2 $21.5 $19.5 New Railcar Backlog $1,540 $2,750 $3,330 $4,200 $4,780 New Railcar Backlog (units) 15,200 26,400 31,500 41,200 46,000 Deliveries (units) 3,400 4,300 4,800 4,000 5,200

2Q Business Conditions 2Q Business Conditions

30

0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% $- $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 $1.6 $1.8 $2.0

2010 2011 2012 2013 2014 LTM 2/28/15

$ in Millions Revenue Gross Margin

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SLIDE 32

Wheels & Parts

Quarterly Trends Quarterly Trends Revenue and Gross Margin %(1) Revenue and Gross Margin %(1) FY 15 Outlook FY 15 Outlook

  • Revenue increase reflects higher volume and

product mix

  • Gross margin decrease driven by reduced

scrap steel pricing; improvement expected in second half of FY 2015

  • Capital expenditures are expected to be

approximately $10 million in FY 2015

  • Improved operating efficiencies and

performance

2Q Business Conditions 2Q Business Conditions

31

* Excluding gain on contribution to GBW, operating margin is 2.7% for Q4 FY 2014

($ in millions)

2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Revenues

$136.5 $140.7 $105.0 $86.6 $102.6

Gross Margin

$8.6 $10.8 $6.8 $9.8 $9.9

Gross Margin %

6.3% 7.7% 6.5% 11.3% 9.6%

Operating Margin %

2.6% 3.9% 30.3%* 9.2% 7.8%

Capital Expenditures

$1.7 $2.5 $3.0 $1.8 $1.7

0% 2% 4% 6% 8% 10% 12% $- $100 $200 $300 $400 $500 $600

2010 2011 2012 2013 2014 LTM 2/28/15

$ in Thousands Revenue Gross Margin

(1) Historical results include legacy Repair operations

which were contributed to GBW Railcar JV in July 2014

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SLIDE 33

Leasing & Services

Quarterly Trends Revenue and Gross Margin % FY 15 Outlook

  • 1Q revenue benefitted from syndication of

third party produced railcars

  • Sequential margin % increase reflects lower

margin syndication of third party produced railcars in Q1 and increased interim rents driven by increased syndication activity

  • Increased volumes of lease syndications in

second half FY 2015

  • Continued growth of interim rents and

managed assets associated with syndication and management services activity

  • Net capital expenditures are expected to be

approximately $25 million in FY 2015 (Gross capital expenditures of $35 million, including corporate expenditures, offset by equipment proceeds of approximately $10 million)

2Q Business Conditions

32

($ in millions)

2Q 14 3Q 14 4Q 14 1Q 15 2Q 15

Revenues

$17.9 $27.0 $21.0 $28.5 $22.3

Gross Margin

$8.1 $12.2 $11.3 $14.4 $13.4

Gross Margin %

45.0% 45.1% 53.7% 50.6% 60.3%

Operating Margin %

53.8% 53.9% 38.9% 38.8% 44.1%

Net Capital Expenditures ($12.5)

($10.0) ($13.3) $5.9 $0.5

Lease Fleet Utilization

97.6% 97.9% 98.2% 98.1% 99.5%

38% 40% 42% 44% 46% 48% 50% 52% $- $20 $40 $60 $80 $100

2010 2011 2012 2013 2014 LTM 2/28/15

$ in Thousands Revenue Gross Margin

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SLIDE 34

North American Service Coverage

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SLIDE 35

Quarterly Adjusted EBITDA Reconciliation

Supplemental Disclosure Reconciliation of Net Earnings to Adjusted EBITDA

(In millions, unaudited)

Quarter Ending

  • Nov. 30,

2013

  • Feb. 28,

2014 May 31, 2014

  • Aug. 31,

2014

  • Nov. 30,

2014

  • Feb. 28,

2015 Net earnings $23.0 $20.5 $46.1 $60.1 $36.0 $61.0 Interest and foreign exchange 4.7 4.1 5.4 4.4 3.1 1.9 Income tax expense 10.5 9.9 16.3 35.7 16.1 29.4 Depreciation and amortization 10.9 9.9 10.1 9.6 12.0 10.4 Gain on contribution to GBW

  • (29.0)
  • Restructuring charges

0.9 0.5 0.1

  • Adjusted EBITDA

$50.0 $44.9 $78.0 $80.8 $67.2 $102.7

See slide 39 for definition of Adjusted EBITDA

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SLIDE 36

Annual Adjusted EBITDA Reconciliation

Supplemental Disclosure Reconciliation of Net Earnings (loss) to Adjusted EBITDA

(In millions, unaudited)

Year Ending August 31, 2009 2010 2011 2012 2013 2014 Net earnings (loss) ($57.9) $8.3 $8.4 $61.2 ($5.4) $149.8 Interest and foreign exchange 45.9 45.2 37.0 24.8 22.2 18.7 Income tax expense (benefit) (16.9) (0.9) 3.5 32.4 25.1 72.4 Depreciation and amortization 37.6 37.5 38.3 42.4 41.4 40.4 Goodwill impairment 55.7

  • 76.9
  • Gain on contribution to GBW
  • (29.0)

Loss (gain) on debt extinguishment

  • (2.1)

15.7

  • Special items
  • (11.9)
  • 2.7

1.5 Adjusted EBITDA $64.4 $76.1 $102.9 $160.8 $162.9 $253.8

See slide 39 for definition of Adjusted EBITDA

35

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SLIDE 37

Annual Adjusted EPS Reconciliation

Year Ending August 31, 2009 2010 2011 2012 2013 2014 Net earnings (loss) attributable to Greenbrier ($56.4) $4.3 $6.5 $58.7 ($11.1) $111.9 Goodwill impairment 51.0

  • 71.8
  • Gain on contribution to GBW (after-tax)
  • (13.6)

Loss (gain) on debt extinguishment (after-tax)

  • (1.3)

9.4

  • Special items (after-tax)
  • (11.9)
  • 1.8

1.0 Adjusted Net Earnings (loss) ($5.4) ($8.9) $15.9 $58.7 $62.5 $99.3 Weighted average diluted shares outstanding 16.8 20.2 26.5 33.7 34.2 34.2 Adjusted EPS ($0.32) ($0.44) $0.60 $1.91 $2.00 $3.07

See slide 39 for definition of Adjusted EPS

Supplemental Disclosure

Reconciliation of Net Earnings (loss) Attributable to Greenbrier to Net Earnings Excluding Goodwill Impairment, Gain on Contribution to GBW, Loss (gain) on Debt extinguishment and Special Items

(In millions, except per share amounts, unaudited)

36

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SLIDE 38

Adjusted Financial Metric Definition

Adjusted Net Earnings (loss), Adjusted EBITDA, Return on Invested Capital and Adjusted EPS are not financial measures under generally accepted accounting principles (GAAP). We define Adjusted Net Earnings (loss) as Net Earnings (loss) attributable to Greenbrier before goodwill impairment (after-tax), gain on contribution to GBW (after-tax), loss (gain) on debt extinguishment (after-tax) and special items (after-tax). We define Adjusted EBITDA as Net earnings (loss) before interest and foreign exchange, income tax expense (benefit), goodwill impairment, gain on contribution to GBW, loss (gain) on debt extinguishment, special items, depreciation and amortization. We define Adjusted EPS as Adjusted Net Earnings (loss) before interest and debt issuance costs (net of tax) on convertible notes divided by Weighted average diluted shares outstanding. We define Return on Invested Capital as Earnings from Operations less Cash paid for Income taxes, which is then annualized and divided by the sum

  • f average Revolving notes plus Notes payable plus Total equity less Cash in excess of $40

million operating cash, which is averaged based on the quarterly ending balances. Adjusted Net Earnings (loss), Adjusted EBITDA, and Adjusted EPS are performance measurement tools used by rail supply companies and Greenbrier. You should not consider Adjusted Net Earnings (loss), Adjusted EBITDA, and Adjusted EPS in isolation or as a substitute for other financial statement data determined in accordance with GAAP. In addition, because Adjusted Net Earnings (loss), Adjusted EBITDA and Adjusted EPS are not measures of financial performance under GAAP and are susceptible to varying calculations, these measures presented may differ from and may not be comparable to similarly titled measures used by

  • ther companies.

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NYSE: GBX

May 2015

Investor Contact: Investor.Relations@gbrx.com Website: www.gbrx.com