-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JHMfn719H4aS/TDHSxRC7wpGOSHoZgo20cEPyq+eNKiaprynQsKCck0GfXtjqJrP ckvlY+tDOLup+4G6f0b2DA== 0000357019-95-000022.txt : 19951119 0000357019-95-000022.hdr.sgml : 19951119 ACCESSION NUMBER: 0000357019-95-000022 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: GATX CAPITAL CORP CENTRAL INDEX KEY: 0000357019 STANDARD INDUSTRIAL CLASSIFICATION: FINANCE SERVICES [6199] IRS NUMBER: 941661392 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-08319 FILM NUMBER: 95592150 BUSINESS ADDRESS: STREET 1: FOUR EMBARCADERO CTR SUITE 2200 CITY: SAN FRANCISCO STATE: CA ZIP: 94111 BUSINESS PHONE: 4159553200 FORMER COMPANY: FORMER CONFORMED NAME: GATX LEASING CORP DATE OF NAME CHANGE: 19900405 10-Q 1 SEPTEMBER 30, 1995 10Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q X QUARTERLY REPORT PURSUANT TO SECTION 13 OR - ------ 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended September 30, 1995 Commission File Number 1-8319 GATX CAPITAL CORPORATION Incorporated in the State of Delaware IRS Employer Identification Number 94-1661392 Four Embarcadero Center San Francisco, CA 94111 (415) 955-3200 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes X NO ------ ------ All Common Stock of Registrant is held by GATX Financial Services, Inc. (a wholly-owned subsidiary of GATX Corporation) As of October 31, 1995, Registrant has outstanding 1,031,250 shares of $1 par value Common Stock. THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT. PART I. FINANCIAL INFORMATION Item 1. Financial Statements
GATX CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND REINVESTED EARNINGS (in Thousands) Three Months Ended Nine Months Ended September 30, September 30, 1995 1994 1995 1994 ---- ---- ---- ---- (unaudited) (unaudited) EARNED INCOME: Leases $ 32,601 $ 36,415 $ 99,712 $109,668 Gain on sale of assets 5,112 4,368 29,200 11,165 Fees 4,414 2,063 14,567 7,004 Interest 5,348 8,103 17,697 19,537 Investment in joint ventures 7,728 3,340 14,913 6,532 Other 682 1,381 2,021 3,094 --------- --------- --------- --------- 55,885 55,670 178,110 157,000 --------- --------- --------- --------- EXPENSES: Interest 16,920 15,907 49,988 46,651 Operating leases 11,529 13,233 34,812 36,411 Selling, general and administrative 9,676 10,209 29,989 27,958 Provision for losses on investments 3,000 5,000 12,000 15,000 Other 191 193 505 594 --------- ---------- ---------- ---------- 41,316 44,542 127,294 126,614 --------- ---------- ---------- ---------- Income before income taxes 14,569 11,128 50,816 30,386 --------- ---------- ---------- ---------- INCOME TAXES: Current income tax expense 2,769 (716) 16,206 7,750 (benefit) Deferred income tax expense 4,158 5,232 5,401 4,566 --------- ---------- ---------- ---------- 6,927 4,516 21,607 12,316 --------- ---------- ---------- ---------- NET INCOME 7,642 6,612 29,209 18,070 Reinvested earnings at beginning of period 160,051 139,725 146,036 133,570 Dividends paid to stockholder (4,099) (3,156) (11,651) (8,459) --------- ---------- ---------- ---------- REINVESTED EARNINGS AT END OF PERIOD $163,594 $ 143,181 $163,594 $ 143,181 ========= ========== ========== ==========
GATX CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in Thousands) September 30, December 31, 1995 1994 ---- ---- (Unaudited) ASSETS: Cash and cash equivalents $ 6,111 $ 9,407 Investments: Direct financing leases 263,503 245,441 Leveraged leases 231,138 252,651 Operating lease equipment- net of depreciation 334,886 295,273 Secured loans 231,407 231,225 Investment in joint ventures 218,459 202,367 Assets held for sale or lease 24,373 24,320 Other investments 42,317 20,373 Investment in future residuals 13,898 13,157 Less: Allowance for losses on investments (94,906) (82,206) ------------ ------------ Total investments 1,265,075 1,202,601 Due from GATX Corporation 41,320 42,515 Other assets 16,162 15,067 ------------ ------------ TOTAL ASSETS $ 1,328,668 $ 1,269,590 ============ ============
GATX CAPITAL CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in Thousands)
September 30, December 31, 1995 1994 ---- ---- (Unaudited) LIABILITIES AND STOCKHOLDER'S EQUITY: Accrued interest $ 12,036 $ 14,987 Accounts payable and other liabilities 60,692 108,635 Debt financing: Commercial paper and bankers' acceptances 212,907 124,834 Notes payable 13,600 14,021 Obligations under capital leases 16,033 19,431 Senior term notes 615,600 613,600 ------------ ------------ Total debt financing 858,140 771,886 Nonrecourse obligations 53,780 55,270 Deferred income 4,116 4,185 Deferred income taxes 20,742 15,390 Stockholder's equity: Convertible preferred stock 1,027 1,027 Common stock 1,031 1,031 Additional paid in capital 151,902 151,902 Reinvested earnings 163,594 146,036 Equity adjustment from foreign currency translation 1,608 (759) ------------ ------------ Total stockholder's equity 319,162 299,237 ------------ ------------ TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 1,328,668 $ 1,269,590 ============ ============
GATX CAPITAL CORPORATION AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED CASH FLOWS (in Thousands) Nine Months Ended September 30, 1995 1994 ---- ---- (unaudited) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 29,209 $ 18,070 Reconciliation to net cash from operating activities: Provision for losses on investments 12,000 15,000 Depreciation expense 20,655 23,791 Provision for deferred income taxes 5,401 4,566 Gain on sale of assets (29,200) (11,165) Joint venture income (14,913) (6,532) Changes in assets and liabilities: Accrued interest and other payables (56,377) 45,827 Due from GATX Corporation 1,195 (2,922) Deferred income (69) (47,934) Other - net (7,355) 154 ---------- ---------- Net cash flows (used in) provided by operating activities (39,454) 38,855 ---------- ---------- CASH FLOWS FROM INVESTING ACTIVITIES: Investments in leased equipment, net of nonrecourse borrowings for leveraged leases (179,506) (128,972) Loans extended to borrowers (58,244) (55,293) Other investments (32,649) (1,103) ---------- ---------- Total investments (270,399) (185,368) ---------- ---------- Lease rents received, net of earned income and leveraged lease nonrecourse debt service 40,640 17,214 Loan principal received 41,857 58,413 Proceeds from sale of equipment 123,323 52,947 Proceeds from sale of real estate 1,727 8,160 Joint venture investment recovery 18,887 16,275 ---------- ---------- Recovery of investments 226,434 153,009 ---------- ---------- Net cash flows used in investing activities (43,965) (32,359) ---------- ---------- CASH FLOWS FROM FINANCING ACTIVITIES: Net increase in short-term borrowings 87,652 17,746 Proceeds from issuance of long-term debt 80,000 55,000 Repayment of long-term debt (78,000) (56,250) Dividends paid to stockholder (11,651) (8,459) Other financing activities 2,122 (5,494) ---------- ---------- Net cash flows provided by financing activities 80,123 2,543 ---------- ---------- Net (decrease) increase in cash and cash equivalents (3,296) 9,039 Cash and cash equivalents at beginning of the period 9,407 12,950 ---------- ---------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 6,111 $ 21,989 ========== ==========
PART I. FINANCIAL INFORMATION Item 1. Financial Statements, continued NOTES TO CONSOLIDATED FINANCIAL STATEMENTS September 30, 1995 and 1994 1. The consolidated balance sheet of GATX Capital Corporation (the "Company") at December 31, 1994 was derived from the audited financial statements at that date. All other consolidated financial statements are unaudited and include all adjustments, consisting only of normal recurring items, which management considers necessary for a fair statement of the consolidated results of operations and financial position for and as of the end of the indicated periods. Operating results for the nine months ended September 30, 1995 are not necessarily indicative of the results that may be achieved for the entire year. 2. Certain prior year amounts have been reclassified to conform to the current presentation. PART I. FINANCIAL INFORMATION, continued Item 2. Management's Discussion and Analysis GATX Capital Corporation's net income for the nine months ended September 30, 1995, was $11.1 million higher than for the comparable 1994 period. The $21.1 million increase in earned income compared to 1994 is mainly the result of the remarketing of assets. Gains on sale of assets, which are realized both at lease end and in response to market opportunities, do not occur evenly between periods and are expected to be lower in the fourth quarter of 1995. Higher fees, primarily related to managed-asset remarketing, also contributed to the total change in earned income. Income from joint ventures increased significantly as well, largely due to higher interest rates on variable rate leases in an international aircraft joint venture and a gain on the sale of a real estate investment in the third quarter of 1995. Lower income from leases partially offset the growth described above. Lease income in 1994 included rentals on four DC-10 aircraft which were returned in January 1995, three of which have not been re-leased as of September 30, 1995. The Company sold the fourth aircraft in September 1995. During 1995, the Company also sold interests in certain other aircraft and reduced its residual estimates on an older aircraft subject to a leveraged lease, resulting in lower lease income compared to 1994. Higher interest rates resulted in increased interest expense in 1995 compared to 1994. Selling, general and administrative expense also rose over this period, due mainly to higher spending in such business-growth support areas as human resources and information systems, partially offset by increased capitalization of initial direct cost for new leases. The provision for losses on investments and expenses relating to operating leases declined from 1994 to 1995. The decrease in operating lease expense reflects the sale of certain aircraft in 1995, as noted above. Income tax expense for the three months ended September 30, 1995 included certain rate adjustments. The Company projects an effective tax rate of approximately 42% for the twelve months ended December 31, 1995. The decrease in accounts payable and other liabilities since the end of 1994 was due mainly to a $48.0 million refund of a deposit, in the first quarter of 1995, as the result of a lessee's exercise of an option to return four DC-10 aircraft. Floating rate debt financing represented 35.4% of the Company's capital structure as of September 30, 1995. These borrowings support leases and loans tied to LIBOR or similar rates. Fluctuations in interest rates may impact earnings, either negatively or positively, depending on the Company's net floating rate postion. At September 30, 1995, the Company had $46.3 million more floating rate debt than floating rate assets. As of September 30, 1995, the Company had $277.1 million of transactions which had been approved but not yet funded. Of this amount, the Company expects to fund approximately $94 million during 1995 and the remainder, beyond. The Company generates cash from operations and from portfolio proceeds and has certain facilities for borrowing. As of September 30, 1995, the Company had a $300.0 million shelf registration for Series C medium term notes, of which $135.0 million had been issued. The Company also had unused capacity under its credit agreements of $37.1 million as of September 30, 1995. Part II. OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: 27. Financial Data Schedule (b) The Company filed no reports on Form 8-K during the three months ended September 30, 1995. Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. GATX CAPITAL CORPORATION /s/ Michael E. Cromar ----------------------- Michael E. Cromar Vice President & Chief Financial Officer /s/ Curt F. Glenn ------------------------------- Curt F. Glenn Principal Accounting Officer and Vice President & Controller November 10, 1995 EX-27 2
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF INCOME AND THE CONSOLIDATED BALANCE SHEETS AND IS QUALIFIED IN ITS ENTIRETY TO SUCH FINANCIAL STATEMENTS. 1000 9-MOS DEC-31-1995 JAN-01-1995 SEP-30-1995 6111 0 726048 94906 24373 0 334886 0 1328668 0 685413 1031 0 1027 317104 1328668 0 178110 0 0 65306 12000 49988 50816 21607 0 0 0 0 29209 0 0 CONSISTS OF DIRECT FINANCE LEASE RECEIVABLES OF 263503, LEVERAGE LEASE RECEIVABLES OF 231138, AND SECURED LOANS OF 231407. CONSISTS OF ASSETS HELD FOR SALE OR LEASE. CONSISTS OF COST OF EQUIPMENT LEASED TO OTHERS UNDER OPERATING LEASES, NET OF DEPRECIATION. GATX CAPITAL CORPORATION HAS AN UNCLASSIFIED BALANCE SHEET. CONSISTS OF SENIOR TERM NOTES OF 615600, OBLIGATIONS UNDER CAPITAL LEASES OF 16033, AND NONRECOURSE OBLIGATIONS OF 53780. PAR VALUE ONLY. CONSISTS OF RETAINED EARNINGS OF 163594, ADDITIONAL PAID-IN CAPITAL OF 151902 AND TRANSLATION ADJUSTMENT OF 1608. CONSISTS OF OPERATING LEASE EXPENSE OF 34812, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES OF 29989, AND OTHER EXPENSES OF 505.
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