Segment Information

6 Months Ended

Feb. 28, 2015

Segment Information

Note 11 – Segment Information

Through July 18, 2014, Greenbrier operated in three reportable segments: Manufacturing; Wheels, Repair & Parts; and Leasing & Services. On July 18, 2014, the Company completed the formation of GBW, an unconsolidated 50/50 joint venture with Watco which became the Company’s fourth reportable segment (GBW Joint Venture) upon formation. The Wheels & Parts segment (previously known as Wheels, Repair & Parts through 2014) included the results of operations for its repair, refurbishment, maintenance and retrofitting (“Repair”) operations through July 18, 2014. After July 18, 2014, the results of GBW were included as part of Earnings (loss) from unconsolidated affiliates as the Company accounts for its interest in GBW under the equity method of accounting. Certain assets including real property, personal property, accounts receivable and accounts payable were not contributed or sold to GBW and remained as part of the Wheels & Parts segment.

The results of operations for the GBW Joint Venture are not reflected in the tables below as the investment is accounted for under the equity method of accounting. For the three and six months ended February 28, 2015, GBW generated total revenue of $83.3 million and $165.9 million. GBW had total assets of $217.4 million and $210.6 million as of February 28, 2015 and August 31, 2014. The Company recorded a loss of $0.3 million and earnings of $0.1 million in Earnings (loss) from unconsolidated affiliates associated with GBW for the three and six months ended February 28, 2015. The Company’s total investment in GBW at February 28, 2015 was $57.7 million which is included in unallocated assets in the tables below.

The accounting policies of the segments are described in the summary of significant accounting policies in the Consolidated Financial Statements contained in the Company’s 2014 Annual Report on Form 10-K. Performance is evaluated based on Earnings from operations. Corporate includes selling and administrative costs not directly related to goods and services and certain costs that are intertwined among segments due to our integrated business. The Company does not allocate Interest and foreign exchange or Income tax expense for either external or internal reporting purposes. Intersegment sales and transfers are valued as if the sales or transfers were to third parties. Related revenue and margin are eliminated in consolidation and therefore are not included in consolidated results in the Company’s Consolidated Financial Statements.

The information in the following table is derived directly from the segments’ internal financial reports used for corporate management purposes.

For the three months ended February 28, 2015:

	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	505,241	$	81		$	505,322		$	90,876		$	9		$	90,885
Wheels & Parts		102,640		5,934			108,574			7,976			653			8,629
Leasing & Services		22,268		18,627			40,895			9,811			18,627			28,438
Eliminations		—		(24,642	)		(24,642	)		—			(19,289	)		(19,289	)
Corporate		—		—			—			(16,131	)		—			(16,131	)
	$	630,149	$	—		$	630,149		$	92,532		$	—		$	92,532
For the six months ended February 28, 2015:
	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	885,190	$	7,501		$	892,691		$	142,927		$	795		$	143,722
Wheels & Parts		189,264		12,845			202,109			15,908			1,437			17,345
Leasing & Services		50,753		31,811			82,564			20,853			31,811			52,664
Eliminations		—		(52,157	)		(52,157	)		—			(34,043	)		(34,043	)
Corporate		—		—			—			(32,734	)		—			(32,734	)
	$	1,125,207	$	—		$	1,125,207		$	146,954		$	—		$	146,954
For the three months ended February 28, 2014:
	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	347,755	$	—		$	347,755		$	30,112		$	—		$	30,112
Wheels & Parts		136,540		2,307			138,847			3,574			42			3,616
Leasing & Services		17,921		5,414			23,335			9,636			5,420			15,056
Eliminations		—		(7,721	)		(7,721	)		—			(5,462	)		(5,462	)
Corporate		—		—			—			(8,720	)		—			(8,720	)
	$	502,216	$	—		$	502,216		$	34,602		$	—		$	34,602
For the six months ended February 28, 2014:
	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	707,228	$	—		$	707,228		$	68,426		$	—		$	68,426
Wheels & Parts		249,941		3,960			253,901			3,201			73			3,274
Leasing & Services		35,402		8,289			43,691			18,305			8,289			26,594
Eliminations		—		(12,249	)		(12,249	)		—			(8,362	)		(8,362	)
Corporate		—		—			—			(17,108	)		—			(17,108	)
	$	992,571	$	—		$	992,571		$	72,824		$	—		$	72,824

	Total assets
	February 28, 2015		August 31, 2014
Manufacturing	$	663,567	$	521,711
Wheels & Parts		291,358		298,009
Leasing & Services		516,835		436,075
Unallocated		218,649		261,373
	$	1,690,409	$	1,517,168