Triton International Limited

Good day and welcome to the Trenton International Limited Second Quarter 2022 Earnings Call. All participants will be in listen-only mode. If you need assistance, please signal a conference specialist by pressing the start key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. I'd like to turn the conference over to Mr. John Burns, CFO. Please go ahead.

Thank you. Good morning, and thank you for joining us on today's call. We are here to discuss Triton's second quarter 2022 results, which were reported this morning. Joining me on this morning's call from Triton is Brian Sunday, our CEO, and John O'Callaghan, our head of global marketing and operations. Before I turn the call over to Brian, I'd like to note that our prepared remarks will follow along with a presentation that can be found in the investor section of our website. I'd like to direct you to slide two of that presentation and remind you that today's presentation includes forward-looking statements that reflect Triton's current view with respect to future events, financial performance, and industry conditions. These forward-looking statements are subject to various risks and uncertainties. Triton has provided additional information in its reports on file with the SEC concerning factors that could cause actual results to differ materially from those contained in this presentation, and we encourage you to review these factors. In addition, reconciliations of non-GAAP measures to the most directly comparable GAAP financial measures are included in our earnings release and the presentation. With these formalities out of the way, I'll now turn the call over to Brian.

Thanks, John, and welcome to Triton International's second quarter 2022 earnings conference call. I'll start with slide three of our presentation. Triton achieved record performance again in the second quarter of 2022. We generated $2.92 of adjusted net income per share, an increase of 5.8% from the first quarter, and an increase of 36% from the second quarter of last year. And we achieved an annualized return on equity of nearly 30%. Our gain on sale benefited by $6.8 million in the second quarter, from several finance lease transactions for older containers, though we still would have achieved record results without these transactions. Market conditions remain constructive. New container transactions have been limited this year following the exceptional demand we experienced in 2021, but container drop-offs are low. Our utilization remains well over 99%, reflecting our strong long-term lease portfolio and container supply conditions that are still fairly tight. And container prices remain historically high, providing support for leasing rates and our disposal gains. Our strong financial performance also reflects the durable enhancements we've made to our business. We invested $4.5 billion in new containers over the last two years, leading to over 30% growth in our revenue-earning assets. We have placed these containers onto high-margin, long-duration leases. We have extended lease durations across our fleet and increased the portion of our containers on lifecycle leases to almost 60 percent. And we have achieved meaningful interest expense savings through aggressive refinancing and locked in these savings by focusing on fixed-rate, long-duration debt. We continue to use our strong cash flow to drive shareholder value. We have shifted our investment focus to share repurchases this year, and believe they offer a compelling value for the company. Year to date, we have repurchased 3.9 million shares, or about 6% of our total. We accelerated our repurchases over the last two months, and our board of directors has increased our repurchase authorization back to $200 million. We've also announced a quarterly dividend of 65 cents per common share. We expect our financial performance will remain strong. The durable enhancements to our lease portfolio and capital structure should continue to sustain our strong leasing margin, and our share repurchases are highly accretive. We expect our adjusted net income per share in the third quarter will remain in line with our record results in the second quarter, excluding the extra gains from the finance lease transactions. And we expect our cash flow, profitability, and return on equity will remain very high throughout 2022 and into the longer term. I will now hand the call over to John O'Callaghan, our Global Head of Marketing and Operations.