Greenbrier Cos. (NYSE: GBX) reported Q1 EPS of $0.79, $0.04 worse than the analyst estimate of $0.83. Revenue for the quarter came in at $552.3 million versus the consensus estimate of $489.39 million.

GUIDANCE:

Greenbrier Cos. sees FY2017 EPS of $3.25-$3.75, versus the consensus of $3.37. Deliveries will be approximately 14,000 – 16,000 units. Revenue will be $2.0 – $2.4 billion.

William A. Furman, Chairman and CEO, said, "Greenbrier's fiscal 2017 is off to a strong start with solid financial performance delivered during a demanding first quarter. We had healthy manufacturing margins on lower deliveries, a testament to the strength of our manufacturing and leasing operations. We continue to execute on our strategy of focusing on our core North American operations while pursuing targeted investments in international markets."

Furman continued, "Brazil's economic, business and political conditions have improved and forecasts indicate continued GDP improvement in 2017. Greenbrier's operations in Brazil and our relationship with our partners continue to grow. For the quarter ended November 30, 2016, our Brazilian railcar manufacturing joint venture Greenbrier-Maxion received orders and awards for over 2,000 railcars, which are not included in Greenbrier's reported orders. We have accelerated discussions to increase our interest in the Brazil operations with an incremental investment of nearly $24 million, which will be used to pay down high cost debt. Our facilities in Brazil include the largest railcar assembly plant in South America along with a castings facility. The need for high quality transportation equipment is poised to grow based in part on railcar fleet demographics with a high percentage of the fleet being older or obsolete."

Furman added, "As we pursue investments in growth opportunities, our solid financial returns in our core business in North America and internationally along with our strong balance sheet remain critical. These provide us the flexibility to compete effectively today while continuing to invest domestically and internationally for tomorrow. In addition, changes in the global trade environment will require robust risk management."

Furman concluded, "Based on our first quarter results, regular communications with customers and current production schedules in North America, we are reaffirming our guidance for the year. We will continue to seek opportunities to diversify by accessing new global markets, while streamlining our cost structures to maximize profitability in North America."

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