The Greenbrier Companies, Inc.

Good morning. Hello, and welcome to the Greenbrier Company's first quarter of fiscal 2021 earnings conference call. Following today's presentation, we will conduct a question and answer session. Each analyst should limit themselves to only two questions. Until that time, all lines will be in the listen-only mode. At the request of the Greenbrier Company, this conference call is being recorded for instant replay purposes. At this time, I would like to turn the conference over to Mr. Justin Roberts, Vice President and Treasurer. Mr. Roberts, you may begin.

Mr. Thank you, Jill. Good morning, everyone, and Happy New Year. Welcome to our first quarter of fiscal 2021 conference call. On today's call, I am joined by Greenbrier's Chairman and CEO, Bill Furman, Laurie Ticorius, President and Chief Operating Officer, and Adrian Downs, Senior Vice President and Chief Financial Officer. They will provide an update on Greenbrier's performance and our near-term priorities. Following our introductory remarks, we will open up the call for questions. In addition to the press release issued this morning, additional financial information and key metrics are found in a slide presentation posted today on the IR section of our website. Matters discussed on today's conference call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Throughout our discussion today, we will describe some of the important factors that could cause Greenbrier's actual results in 2021 and beyond to differ materially from those expressed in any forward-looking statement made by or on behalf of Greenbrier. And with that, I will hand it over to Bill.

Thank you, Justin. Good morning, everyone. Before I begin, I'd like to wish everyone on the call a happy new year. 2020 won't be soon forgotten. Despite the real and lingering challenges of last year, the hope that ushers in each new year is especially strong now. I want to thank our employees and all our stakeholders for your support. Together, we're weathering some of the more challenging days of the pandemic. I have a strong expectation Greenbrier will emerge better and even more capable when normalcy returns later this year, as we all hope it will. But as we can see, In the newspaper and in the media, good times are not here yet. In fact, we remain in the throes of the pandemic, and we're buffeted by its disruptive forces in the economy and in our markets. This requires the company and its management team and board to remain disciplined as we maintain the strategic priorities I discussed over the past several quarters. We believe good outcomes will follow. Regular operations continue. in all of our facilities as a result of extensive health and safety protocols. Protecting the health and well-being of our global workforce is our very first priority. Keeping our businesses open as part of an essential industry is also highly important as is maintaining our backlog. Our ongoing practices identify and act promptly upon any potential COVID-19 exposure. Our protocols are enforced by management with a high degree of rigor at the highest levels, including our board of directors. The board receives a weekly report on COVID incident rate and severity. And in some of the markets and communities where we operate, community spread continues to be at pandemic levels. In December, we lost Ramon Devasca to COVID-19. Juan was a, Ramon, I'm sorry, was a materials coordinator at our GEMSA operation. He was in his early 40s with no pre-existing risk factors. Subsequently, during the same week, both his mother and his father died of COVID-19. We are remembering him and his family during this difficult time. Juan is the fifth member of the Greenbar family to die from COVID-19. Earlier this year, we lost three colleagues in Mexico and one in Romania. With an average workforce of 13,500 employees since the period when the pandemic began in earnest in March, Greenbrier's experience rate with COVID-19 deaths and infections is significantly lower than the communities in which we operate as a whole. In fact, our factories are safer, it seems, than the communities in which they operate. When will we ever learn about the means to prevent spread of this terrible disease. So our memories of our colleagues reminds us to stay vigilant with our own health and safety practices everywhere we go. Related to our practices and observed in response to COVID-19 is our industry leading safety performance. In fact, we had the lowest number of monthly injuries in November since we started tracking safety metrics with zero injuries in North America and in South America. Turning to financial performance, our fiscal first quarter results were weak, with a reported loss from operations for the first time in nearly 10 years. That occurred last during the depths of the Great Recession. Despite this loss, we continue to generate solid operating cash flow, an important measure of Greenbar's health and vitality. This results from earlier actions we executed as our industry entered a downturn in mid-2019 including adjusting capacity and reducing costs prior to and during the onset of the pandemic. The pandemic compelled us to take a series of additional tough steps to protect the enterprise and to ensure Greenbrier maintained the strongest possible financial position. We served markets with cyclical demand that are also uniquely exposed to broader economic forces. This makes flexibility and adaptability an integral to Greenbar's survival. Not only its survival, but its long-term growth, recovery, and well-being. Our industry faces serious short-term challenges. Maintaining and growing liquidity for Greenbar has been a core priority. After achieving our ambitious liquidity target of $1 billion, We used some of our cash balances to reduce $82 million in debt in the first quarter. Now, with our liquidity goals firmly achieved, our focus shifts to balance sheet management, which provides Greenbrier a competitive advantage as our markets stabilize. Through this, we have maintained a dividend for 27 consecutive quarters with a current yield of 3%. The board just authorized a $100 million stock repurchase authority. Over the past eight years, Greenbar has returned $315 million to its shareholders through stock buybacks and dividends. With right-sizing our capacity nearly complete, Greenbar's operating footprint is well-suited for the market recovery expected in the second half of calendar 2021. Steps we have taken in the past several years have resulted in a strong industry leadership on three continents, And the data we study suggests that when a return to normalcy does arrive, that the rail business will react very quickly and there should be a snapback effect. Overall, we are cautiously optimistic about the U.S. economy and the world during the next 12 months. The recently enacted federal stimulus package, mass vaccine distribution, Steady consumer spending and the promise of robust infrastructure package emerging from a new Congress and administration in Washington are all favorable developments. However, if the pandemic does not abate and business shutdowns continue or increase, momentum could stall and delay the recovery. In any case, the economic repercussions of the pandemic will linger well into the first six months of 2021. After this period, I expect emerging strength, as I've said earlier, in our sector. All economies worldwide rely on rail transportation as an important vitally strategic and environmentally friendly industry. We expect an industry recovery in the rail to be a bellwether for the economy's broader recovery. In the meantime, our diversified backlog value to 2.35 billion provides us a base load of orders as we gain greater visibility into customer requirements over the coming months. Greenbar occupies a fortunate position where we can rapidly expand capacity as outlook improves. In fact, however, as others are doing, we are reducing capacity and right-sizing organizations with a lower cost footprint. Rapidly achieving economies of factory utilization at scale, along with greater direct investment in rail car leasing, will be the heart of our ability to regain profitability quickly when normalcy returns. We have done this through previous industry down cycles in our past experience. We believe it will guide us now. Back in 2010, for example, as we emerged from the Great Recession, we had a backlog of just 5,300 rail cars valued at $400 million at our year end. Greenbrier's scale and capabilities have substantially broadened since then. Recent highlights from a remarkable decade of expansion since 2010 include a much larger share of 2020 North American rail car orders, the diversity of the rail car types we've now billed as much greater than ever before. Our current backlog exceeds our 2010 mark by more than five times. Leveraging off this growth and scale, our stronger franchise, Greenbar, enters the emerging recovery extremely well positioned. The benefits of our expense reduction initiatives will continue as our markets return to higher levels. Despite current market and economic forces, Greenbar's long-term outlook is very positive. Our business generates strong, positive cash flow. We made a strong liquidity position and balance sheet. We are addressing today's challenges with resolve, resilience, and determination. And we are confident that the new year brings better days ahead. Now over to Lori Ticorius, our President and Chief Operating Officer.