10-Q

UNITED STATES

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 quarterly period ended May 31, 2016

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

for the transition period from                      to                     

Commission File No. 1-13146

THE GREENBRIER COMPANIES, INC.

(Exact name of registrant as specified in its charter)

Oregon	93-0816972
(State of Incorporation)	(I.R.S. Employer Identification No.)

One Centerpointe Drive, Suite 200, Lake Oswego, OR 97035

(Address of principal executive offices)(Zip Code)

(503) 684-7000

(Registrant’s telephone number, including area code)

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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulations S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)    Yes  ¨    No  x

The number of shares of the registrant’s common stock, without par value, outstanding on June 30, 2016 was 28,204,389 shares.

THE GREENBRIER COMPANIES, INC.

Forward-Looking Statements

From time to time, The Greenbrier Companies, Inc. and its subsidiaries (Greenbrier or the Company) or their representatives have made or may make forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, without limitation, statements as to expectations, beliefs and strategies regarding the future. Such forward-looking statements may be included in, but not limited to, press releases, oral statements made with the approval of an authorized executive officer or in various filings made by us with the Securities and Exchange Commission, including this Quarterly Report on Form 10-Q. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These forward-looking statements rely on a number of assumptions concerning future events and include statements relating to:

• availability of financing sources and borrowing base for working capital, other business development activities, capital spending and leased railcars for syndication (sale of railcars with lease attached);

• ability to renew, maintain or obtain sufficient credit facilities and financial guarantees on acceptable terms;

• ability to utilize beneficial tax strategies;

• ability to grow our businesses;

• ability to obtain lease and sales contracts which provide adequate protection against attempted modifications or cancellations, changes in interest rates and increased costs of materials and components;

• ability to obtain adequate insurance coverage at acceptable rates;

• ability to convert backlog of railcar orders and obtain and execute lease syndication commitments;

• ability to obtain adequate certification and licensing of products; and

• short-term and long-term revenue and earnings effects of the above items.

The following factors, among others, could cause actual results or outcomes to differ materially from the forward-looking statements:

• fluctuations in demand for newly manufactured railcars or marine barges;

• fluctuations in demand for wheels, repair services and parts;

• delays in receipt of orders, risks that contracts may be canceled or modified during their term, not renewed, unenforceable or breached by the customer and that customers may not purchase the amount of products or services under the contracts as anticipated;

• ability to maintain sufficient availability of credit facilities and to maintain compliance with or to obtain appropriate amendments to covenants under various credit agreements;

• domestic and global economic conditions including such matters as embargoes or quotas;

• global political or security conditions in the U.S., Europe, Latin America and the Middle East including such matters as terrorism, war, civil disruption and crime;

• sovereign risk related to international governments that includes, but is not limited to, governments stopping payments, repudiating their contracts, nationalizing private businesses and assets or altering foreign exchange regulations;

• growth or reduction in the surface transportation industry;

• ability to maintain good relationships with our labor force, third party labor providers and collective bargaining units representing our direct and indirect labor force;

• ability to maintain good relationships with our customers and suppliers;

• ability to renew or replace expiring customer contracts on satisfactory terms;

• ability to obtain and execute suitable lease contracts for leased railcars for syndication;

• steel and specialty component price fluctuations and availability, scrap surcharges, steel scrap prices and other commodity price fluctuations and availability and their impact on product demand and margin;

• delay or failure of acquired businesses or joint ventures, assets, start-up operations, or new products or services to compete successfully;

• changes in product mix and the mix of revenue levels among reporting segments;

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THE GREENBRIER COMPANIES, INC.

• labor disputes, energy shortages or operating difficulties that might disrupt operations or the flow of cargo;

• production difficulties and product delivery delays as a result of, among other matters, costs or inefficiencies associated with expansion, start-up, or changing of production lines or changes in production rates, equipment failures, changing technologies, transfer of production between facilities or non-performance of alliance partners, subcontractors or suppliers;

• lower than anticipated lease renewal rates, earnings on utilization based leases or residual values for leased equipment;

• discovery of defects in railcars or services resulting in increased warranty costs or litigation;

• physical damage, business interruption or product or service liability claims that exceed our insurance coverage;

• commencement of and ultimate resolution or outcome of pending or future litigation and investigations;

• natural disasters or severe weather patterns that may affect either us, our suppliers or our customers;

• loss of business from, or a decline in the financial condition of, any of the principal customers that represent a significant portion of our total revenues;

• competitive factors, including introduction of competitive products, new entrants into certain of our markets, price pressures, limited customer base, and competitiveness of our manufacturing facilities and products;

• industry overcapacity and our manufacturing capacity utilization;

• decreases or write-downs in carrying value of inventory, goodwill, intangibles or other assets due to impairment;

• severance or other costs or charges associated with lay-offs, shutdowns, or reducing the size and scope of operations;

• changes in future maintenance or warranty requirements;

• ability to adjust to the cyclical nature of the industries in which we operate;

• changes in interest rates and financial impacts from interest rates;

• ability and cost to maintain and renew operating permits;

• actions or failures to act by various regulatory agencies including changing tank car or other rail car regulations;

• potential environmental remediation obligations;

• changes in commodity prices, including oil and gas;

• risks associated with our intellectual property rights or those of third parties, including infringement, maintenance, protection, validity, enforcement and continued use of such rights;

• expansion of warranty and product support terms beyond those which have traditionally prevailed in the rail supply industry;

• availability of a trained work force at a reasonable cost and with reasonable terms of employment;

• availability and/or price of essential raw materials, specialties or components, including steel castings, to permit manufacture of units on order;

• failure to successfully integrate joint ventures or acquired businesses;

• discovery of previously unknown liabilities associated with acquired businesses;

• failure of or delay in implementing and using new software or other technologies;

• the impact of cybersecurity risks and the costs of mitigating and responding to a data security breach;

• ability to replace maturing lease and management services revenue and earnings with revenue and earnings from new commercial transactions, including new railcar leases, additions to the lease fleet and new management services contracts;

• credit limitations upon our ability to maintain effective hedging programs;

• financial impacts from currency fluctuations and currency hedging activities in our worldwide operations;

• increased costs or other impacts due to changes in legislation, regulations or accounting pronouncements; and

• fraud, misconduct by employees and potential exposure to liabilities under the Foreign Corrupt Practices Act and other anti-corruption laws and regulations.

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THE GREENBRIER COMPANIES, INC.

Any forward-looking statements should be considered in light of these factors. Words such as “anticipates,” “believes,” “forecast,” “potential,” “goal,” “contemplates,” “expects,” “intends,” “plans,” “projects,” “hopes,” “seeks,” “estimates,” “strategy,” “could,” “would,” “should,” “likely,” “will,” “may,” “can,” “designed to,” “future,” “foreseeable future” and similar expressions identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results contemplated by the forward-looking statements. Many of the important factors that will determine these results and values are beyond our ability to control or predict. You are cautioned not to put undue reliance on any forward-looking statements. Except as otherwise required by law, we do not assume any obligation to update any forward-looking statements.

All references to years refer to the fiscal years ended August 31^st unless otherwise noted.

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THE GREENBRIER COMPANIES, INC.

PART I. FINANCIAL INFORMATION

Item 1. Condensed Financial Statements

Consolidated Balance Sheets

(In thousands, unaudited)

	May 31, 2016			August 31, 2015
Assets
Cash and cash equivalents	$	214,440		$	172,930
Restricted cash		8,669			8,869
Accounts receivable, net		213,510			196,029
Inventories		458,068			445,535
Leased railcars for syndication		136,812			212,534
Equipment on operating leases, net		232,791			255,391
Property, plant and equipment, net		318,010			303,135
Investment in unconsolidated affiliates		89,297			87,270
Intangibles and other assets, net		71,022			65,554
Goodwill		43,265			43,265
	$	1,785,884		$	1,790,512
Liabilities and Equity
Revolving notes	$	—		$	50,888
Accounts payable and accrued liabilities		370,652			455,213
Deferred income taxes		50,390			60,657
Deferred revenue		68,158			33,836
Notes payable		306,808			326,429
Commitments and contingencies (Note 13)
Equity:
Greenbrier
Preferred stock - without par value; 25,000 shares authorized; none outstanding		—			—
Common stock - without par value; 50,000 shares authorized; 28,202 and 28,907 shares outstanding at May 31, 2016 and August 31, 2015		—			—
Additional paid-in capital		278,880			295,444
Retained earnings		590,725			458,599
Accumulated other comprehensive loss		(29,519	)		(21,205	)
Total equity - Greenbrier		840,086			732,838
Noncontrolling interest		149,790			130,651
Total equity		989,876			863,489
	$	1,785,884		$	1,790,512

The accompanying notes are an integral part of these financial statements

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THE GREENBRIER COMPANIES, INC.

Consolidated Statements of Income

(In thousands, except per share amounts, unaudited)

	Three Months Ended May 31,						Nine Months Ended May 31,
	2016			2015			2016			2015
Revenue
Manufacturing	$	458,494		$	593,376		$	1,611,686		$	1,478,566
Wheels & Parts		78,417			97,407			247,604			286,671
Leasing & Services		75,955			23,823			225,044			74,576
		612,866			714,606			2,084,334			1,839,813
Cost of revenue
Manufacturing		352,775			465,658			1,247,635			1,184,922
Wheels & Parts		69,818			89,645			224,208			259,285
Leasing & Services		63,175			10,017			180,737			32,942
		485,768			565,320			1,652,580			1,477,149
Margin		127,098			149,286			431,754			362,664
Selling and administrative expense		43,280			45,595			118,073			112,223
Net gain on disposition of equipment		(311	)		(720	)		(11,326	)		(924	)
Earnings from operations		84,129			104,411			325,007			251,365
Other costs
Interest and foreign exchange		3,712			4,285			10,565			9,355
Earnings before income taxes and earnings from unconsolidated affiliates		80,417			100,126			314,442			242,010
Income tax expense		(22,449	)		(30,783	)		(92,902	)		(76,209	)
Earnings before earnings from unconsolidated affiliates		57,968			69,343			221,540			165,801
Earnings from unconsolidated affiliates		1,564			982			2,921			1,552
Net earnings		59,532			70,325			224,461			167,353
Net earnings attributable to noncontrolling interest		(24,180	)		(27,514	)		(74,808	)		(41,405	)
Net earnings attributable to Greenbrier	$	35,352		$	42,811		$	149,653		$	125,948
Basic earnings per common share	$	1.22		$	1.54		$	5.13		$	4.58
Diluted earnings per common share	$	1.12		$	1.33		$	4.67		$	3.91
Weighted average common shares:
Basic		29,059			27,842			29,182			27,514
Diluted		32,342			33,000			32,475			33,262
Dividends declared per common share	$	0.20		$	0.15		$	0.60		$	0.45

The accompanying notes are an integral part of these financial statements

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THE GREENBRIER COMPANIES, INC.

Consolidated Statements of Comprehensive Income

(In thousands, unaudited)

	Three Months Ended May 31,						Nine Months Ended May 31,
	2016			2015			2016			2015
Net earnings	$	59,532		$	70,325		$	224,461		$	167,353
Other comprehensive income
Translation adjustment		1,477			(1,299	)		(3,655	)		(10,990	)
Reclassification of derivative financial instruments recognized in net earnings 1		659			(254	)		1,710			417
Unrealized gain (loss) on derivative financial instruments 2		1,113			107			(6,417	)		(7	)
Other (net of tax effect)		7			93			1			99
		3,256			(1,353	)		(8,361	)		(10,481	)
Comprehensive income		62,788			68,972			216,100			156,872
Comprehensive income attributable to noncontrolling interest		(24,195	)		(27,497	)		(74,761	)		(41,253	)
Comprehensive income attributable to Greenbrier	$	38,593		$	41,475		$	141,339		$	115,619

¹  Net of tax effect of $0.3 million and $0.04 million for the three months ended May 31, 2016 and 2015 and $0.7 million and $0.4 million for the nine months ended May 31, 2016 and 2015.

²  Net of tax effect of $0.3 million and $0.1 million for the three months ended May 31, 2016 and 2015 and $2.2 million and $0.6 million for the nine months ended May 31, 2016 and 2015.

The accompanying notes are an integral part of these financial statements

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THE GREENBRIER COMPANIES, INC.

Consolidated Statements of Equity

(In thousands, unaudited)

	Attributable to Greenbrier
	Common Stock Shares			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Attributable to Greenbrier			Attributable to Noncontrolling Interest			Total Equity
Balance September 1, 2015		28,907		$	295,444		$	458,599		$	(21,205	)	$	732,838		$	130,651		$	863,489
Net earnings		—			—			149,653			—			149,653			74,808			224,461
Other comprehensive loss, net		—			—			—			(8,314	)		(8,314	)		(47	)		(8,361	)
Noncontrolling interest adjustments		—			—			—			—			—			837			837
Purchase of noncontrolling interest		—			—			—			—			—			(4	)		(4	)
Joint venture partner distribution declared		—			—			—			—			—			(61,855	)		(61,855	)
Investment by joint venture partner		—			—			—			—			—			5,400			5,400
Restricted stock awards (net of cancellations)		350			6,186			—			—			6,186			—			6,186
Unamortized restricted stock		—			(11,646	)		—			—			(11,646	)		—			(11,646	)
Restricted stock amortization		—			18,483			—			—			18,483			—			18,483
Excess tax benefit from restricted stock awards		—			2,786			—			—			2,786			—			2,786
Cash dividends		—			—			(17,527	)		—			(17,527	)		—			(17,527	)
Repurchase of stock		(1,055	)		(32,373	)		—			—			(32,373	)		—			(32,373	)
Balance May 31, 2016		28,202		$	278,880		$	590,725		$	(29,519	)	$	840,086		$	149,790		$	989,876
	Attributable to Greenbrier
	Common Stock Shares			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total Attributable to Greenbrier			Attributable to Noncontrolling Interest			Total Equity
Balance September 1, 2014		27,364		$	235,763		$	282,559		$	(6,932	)	$	511,390		$	62,331		$	573,721
Net earnings		—			—			125,948			—			125,948			41,405			167,353
Other comprehensive loss, net		—			—			—			(10,329	)		(10,329	)		(152	)		(10,481	)
Noncontrolling interest adjustments		—			—			—			—			—			20,371			20,371
Purchase of noncontrolling interest		—			—			—			—			—			(80	)		(80	)
Joint venture partner distribution declared		—			—			—			—			—			(13,267	)		(13,267	)
Restricted stock awards (net of cancellations)		(19	)		22,600			—			—			22,600			—			22,600
Unamortized restricted stock		—			(24,394	)		—			—			(24,394	)		—			(24,394	)
Restricted stock amortization		—			13,176			—			—			13,176			—			13,176
Excess tax benefit from restricted stock awards		—			2,964			—			—			2,964			—			2,964
Conversion of convertible notes, net of debt issuance costs		2,471			91,749			—			—			91,749			—			91,749
Cash dividends		—			—			(12,257	)		—			(12,257	)		—			(12,257	)
Repurchase of stock		(891	)		(48,451	)		—			—			(48,451	)		—			(48,451	)
Balance May 31, 2015		28,925		$	293,407		$	396,250		$	(17,261	)	$	672,396		$	110,608		$	783,004

The accompanying notes are an integral part of these financial statements

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THE GREENBRIER COMPANIES, INC.

Consolidated Statements of Cash Flows

(In thousands, unaudited)

	Nine Months Ended May 31,
	2016			2015
Cash flows from operating activities
Net earnings	$	224,461		$	167,353
Adjustments to reconcile net earnings to net cash provided by operating activities:
Deferred income taxes		(10,143	)		(5,245	)
Depreciation and amortization		41,681			33,258
Net gain on disposition of equipment		(11,326	)		(924	)
Stock based compensation expense		19,055			13,176
Noncontrolling interest adjustments		837			20,371
Other		564			1,008
(Increase) decrease in assets:
Accounts receivable, net		(14,333	)		(8,769	)
Inventories		(15,346	)		(124,906	)
Leased railcars for syndication		28,823			(90,914	)
Other		(5,191	)		(1,666	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(88,707	)		23,135
Deferred revenue		24,303			3,680
Net cash provided by operating activities		194,678			29,557
Cash flows from investing activities
Proceeds from sales of assets		88,707			4,628
Capital expenditures		(51,707	)		(75,892	)
Decrease in restricted cash		200			228
Investment in and advances to unconsolidated affiliates		(9,088	)		(29,923	)
Cash distribution from unconsolidated affiliates		5,338			715
Net cash provided by (used in) investing activities		33,450			(100,244	)
Cash flows from financing activities
Net change in revolving notes with maturities of 90 days or less		(49,000	)		73,000
Proceeds from revolving notes with maturities longer than 90 days		—			42,563
Repayments of revolving notes with maturities longer than 90 days		(1,888	)		(36,137	)
Repayments of notes payable		(19,461	)		(5,504	)
Debt issuance costs		(4,160	)		—
Repurchase of stock		(33,498	)		(48,451	)
Dividends		(17,362	)		(12,069	)
Decrease in restricted cash		—			11,000
Cash distribution to joint venture partner		(62,710	)		(12,489	)
Investment by joint venture partner		5,400			—
Excess tax benefit from restricted stock awards		2,786			2,964
Other		(7	)		(248	)
Net cash provided by (used in) financing activities		(179,900	)		14,629
Effect of exchange rate changes		(6,718	)		(6,075	)
Increase (decrease) in cash and cash equivalents		41,510			(62,133	)
Cash and cash equivalents
Beginning of period		172,930			184,916
End of period	$	214,440		$	122,783
Cash paid during the period for
Interest	$	10,852		$	13,509
Income taxes, net	$	77,867		$	87,829
Non-cash activity
Transfer from Leased railcars for syndication to Equipment on operating leases, net	$	45,535		$	3,313
Capital expenditures accrued in Accounts payable and accrued liabilities	$	3,529		$	2,304
Change in Accounts payable and accrued liabilities associated with repurchase of stock	$	1,125		$	—
Change in Accounts payable and accrued liabilities associated with cash distributions to joint venture partner	$	855		$	—
Change in Accounts payable and accrued liabilities associated with dividends declared	$	(165	)	$	188
Conversion of convertible notes, net of debt issuance costs	$	—		$	91,749

The accompanying notes are an integral part of these financial statements

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Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1 – Interim Financial Statements

The Condensed Consolidated Financial Statements of The Greenbrier Companies, Inc. and its subsidiaries (Greenbrier or the Company) as of May 31, 2016, for the three and nine months ended May 31, 2016 and 2015 have been prepared without audit and reflect all adjustments (consisting of normal recurring accruals) that, in the opinion of management, are necessary for a fair presentation of the financial position, operating results and cash flows for the periods indicated. The results of operations for the three and nine months ended May 31, 2016 are not necessarily indicative of the results to be expected for the entire year ending August 31, 2016.

Certain notes and other information have been condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with the Consolidated Financial Statements contained in the Company’s 2015 Annual Report on Form 10-K.

Management Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires judgment on the part of management to arrive at estimates and assumptions on matters that are inherently uncertain. These estimates may affect the amount of assets, liabilities, revenue and expenses reported in the financial statements and accompanying notes and disclosure of contingent assets and liabilities within the financial statements. Estimates and assumptions are periodically evaluated and may be adjusted in future periods. Actual results could differ from those estimates.

Prospective Accounting Changes – In May 2014, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) jointly issued a converged standard on the recognition of revenue from contracts with customers. The issued guidance converges the criteria for reporting revenue, and requires disclosures sufficient to describe the nature, amount, timing, and uncertainty of revenue and cash flows arising from these contracts. Companies can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. The FASB issued a one year deferral and the new standard is effective for fiscal years and interim periods within those years beginning after December 15, 2017. The Company plans to adopt this guidance beginning September 1, 2018. The Company is evaluating the impact of this standard as well as its method of adoption on its consolidated financial statements and disclosures.

In April 2015, the FASB issued Accounting Standards Update 2015-03, Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). The FASB issued this update to simplify the presentation of debt issuance costs related to a recognized debt liability to present the debt issuance costs as a direct deduction from the carrying value of the debt liability rather than showing the debt issuance costs as an asset. The guidance is limited to the presentation of debt issuance costs and does not impact its recognition and measurement. The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015, with early adoption permitted, and is required to be applied on a retrospective basis. The Company plans to adopt this guidance beginning September 1, 2016. As the adoption of this new guidance will only amend presentation and disclosure requirements, the adoption will not affect the Company’s financial position, results of operations or cash flows.

In August 2015, the FASB issued Accounting Standards Update 2015-15, Interest-Imputation of Interest: Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line of Credit Arrangements (ASU 2015-15). This update was released because the guidance within ASU 2015-03 for debt issuance costs does not address presentation or subsequent measurement of debt issuance costs related to line of credit arrangements. The SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2015. The Company plans to adopt this guidance beginning September 1, 2016. Upon adoption, the Company plans to continue to present debt issuance costs related to line of credit arrangements as an asset. The adoption of this new guidance will not affect the Company’s financial position, results of operations or cash flows.

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THE GREENBRIER COMPANIES, INC.

In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (ASU 2016-02). The new guidance supersedes existing guidance on accounting for leases in Topic 840 and is intended to increase the transparency and comparability of accounting for lease transactions. ASU 2016-02 requires most leases to be recognized on the balance sheet. Lessees will need to recognize a right-of-use asset and a lease liability for virtually all leases. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Lessor accounting remains similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard. The ASU will require both quantitative and qualitative disclosures regarding key information about leasing arrangements. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented. The Company plans to adopt this guidance beginning September 1, 2019. The Company is evaluating the impact of this standard on its consolidated financial statements and disclosures.

In March 2016, the FASB issued Accounting Standards Update 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). The new guidance will change how companies account for certain aspects of share-based payments to employees. Excess tax benefits related to vested awards, previously recognized in equity, will be required to be recognized in the income statement when the awards vest. The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2016, with early adoption permitted. The Company plans to adopt this guidance beginning September 1, 2017. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements and disclosures.

Share Repurchase Program – Since October 2013, the Board of Directors has authorized the Company to repurchase in aggregate up to $225 million of the Company’s common stock. The program may be modified, suspended or discontinued at any time without prior notice. Under the share repurchase program, shares of common stock may be purchased on the open market or through privately negotiated transactions from time-to-time. The timing and amount of purchases will be based upon market conditions, securities law limitations and other factors. The share repurchase program does not obligate the Company to acquire any specific number of shares in any period.

During the nine months ended May 31, 2016, the Company purchased a total of 1,054,687 shares for approximately $32.4 million. The Company did not repurchase any shares during the three months ended May 31, 2016. As of May 31, 2016 the Company had cumulatively repurchased 3,206,226 shares for approximately $137.0 million and had $88.0 million available under the share repurchase program with an expiration date of January 1, 2018.

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THE GREENBRIER COMPANIES, INC.

Note 2 – Inventories

Inventories are valued at the lower of cost (first-in, first-out) or market. Work-in-process includes material, labor and overhead. The following table summarizes the Company’s inventory balance:

(In thousands)	May 31, 2016			August 31, 2015
Manufacturing supplies and raw materials	$	258,608		$	311,880
Work-in-process		63,602			75,032
Finished goods		139,199			61,302
Excess and obsolete adjustment		(3,341	)		(2,679	)
	$	458,068		$	445,535

Note 3 – Intangibles and Other Assets, net

Intangible assets that are determined to have finite lives are amortized over their useful lives. Intangible assets with indefinite useful lives are not amortized and are periodically evaluated for impairment.

The following table summarizes the Company’s identifiable intangible and other assets balance:

(In thousands)	May 31, 2016			August 31, 2015
Intangible assets subject to amortization:
Customer relationships	$	65,023		$	65,023
Accumulated amortization		(36,395	)		(33,828	)
Other intangibles		6,288			3,422
Accumulated amortization		(5,757	)		(3,121	)
		29,159			31,496
Intangible assets not subject to amortization		912			912
Prepaid and other assets		15,671			13,111
Nonqualified savings plan investments		15,093			11,815
Debt issuance costs, net		6,079			3,823
Assets held for sale		4,108			4,397
Total Intangible and other assets, net	$	71,022		$	65,554

Amortization expense for the three and nine months ended May 31, 2016 was $1.5 million and $5.3 million and for the three and nine months ended May 31, 2015 was $0.9 million and $2.7 million. Amortization expense for the years ending August 31, 2016, 2017, 2018, 2019 and 2020 is expected to be $6.3 million, $3.6 million, $3.5 million, $3.4 million and $3.4 million.

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THE GREENBRIER COMPANIES, INC.

Note 4 – Revolving Notes

Senior secured credit facilities, consisting of three components, aggregated to $615.5 million as of May 31, 2016.

As of May 31, 2016, a $550.0 million revolving line of credit, maturing October 2020, secured by substantially all the Company’s assets in the U.S. not otherwise pledged as security for term loans, was available to provide working capital and interim financing of equipment, principally for the U.S. and Mexican operations. Advances under this facility bear interest at LIBOR plus 1.75% or Prime plus 0.75% depending on the type of borrowing. Available borrowings under the credit facility are generally based on defined levels of inventory, receivables, property, plant and equipment and leased equipment, as well as total debt to consolidated capitalization and fixed charges coverage ratios.

As of May 31, 2016, lines of credit totaling $15.5 million secured by certain of the Company’s European assets, with various variable rates that range from Warsaw Interbank Offered Rate (WIBOR) plus 1.2% to WIBOR plus 1.3%, were available for working capital needs of the European manufacturing operation. European credit facilities are continually being renewed. Currently these European credit facilities have maturities that range from February 2017 through June 2017.

The Company’s Mexican railcar manufacturing joint venture has two lines of credit totaling $50.0 million. The first line of credit provides up to $30.0 million and is fully guaranteed by the Company and its joint venture partner. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw against this facility through January 2019. The second line of credit provides up to $20.0 million, of which the Company and its joint venture partner have each guaranteed 50%. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw amounts available under this facility through August 2017.

As of May 31, 2016, outstanding commitments under the senior secured credit facilities consisted of $81.3 million in letters of credit under the North American credit facility.

As of August 31, 2015, outstanding commitments under the senior secured credit facilities consisted of $47.2 million in letters of credit and $49.0 million in revolving notes under the North American credit facility and $1.9 million outstanding in revolving notes under the Mexican railcar manufacturing joint venture credit facilities.

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THE GREENBRIER COMPANIES, INC.

Note 5 – Accounts Payable and Accrued Liabilities

(In thousands)	May 31, 2016		August 31, 2015
Trade payables	$	187,240	$	263,665
Other accrued liabilities		73,919		64,584
Accrued payroll and related liabilities		61,629		70,836
Accrued maintenance		18,488		18,642
Accrued warranty		12,132		11,512
Income taxes payable		11,604		22,465
Other		5,640		3,509
	$	370,652	$	455,213

Note 6 – Warranty Accruals

Warranty costs are estimated and charged to operations to cover a defined warranty period. The estimated warranty cost is based on the history of warranty claims for each particular product type. For new product types without a warranty history, preliminary estimates are based on historical information for similar product types. The warranty accruals, included in Accounts payable and accrued liabilities on the Consolidated Balance Sheets, are reviewed periodically and updated based on warranty trends and expirations of warranty periods.

Warranty accrual activity:

(In thousands)	Three Months Ended May 31,						Nine Months Ended May 31,
	2016			2015			2016			2015
Balance at beginning of period	$	12,147		$	9,188		$	11,512		$	9,340
Charged to cost of revenue, net		1,202			2,036			4,086			3,982
Payments		(1,205	)		(994	)		(3,386	)		(2,797	)
Currency translation effect		(12	)		(32	)		(80	)		(327	)
Balance at end of period	$	12,132		$	10,198		$	12,132		$	10,198

Note 7 – Notes Payable

The Company’s Notes payable balance was $306.8 million as of May 31, 2016 which includes Convertible senior notes, due 2026 (the 2026 Notes). On specified dates or in the event of certain fundamental changes, holders can require the Company to repurchase all or a portion of their 2026 Notes at a price equal to 100% of the principal amount of the 2026 Notes plus accrued and unpaid interest (the Put Option). During the three months ended May 31, 2016, the Company retired $14.0 million of its then $14.9 million outstanding 2026 Notes pursuant to a scheduled Put Option leaving $0.9 million outstanding in 2026 Notes as of May 31, 2016.

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THE GREENBRIER COMPANIES, INC.

Note 8 – Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss, net of tax effect as appropriate, consisted of the following:

(In thousands)	Unrealized Loss on Derivative Financial Instruments			Foreign Currency Translation Adjustment			Other			Accumulated Other Comprehensive Loss
Balance, August 31, 2015	$	(2,194	)	$	(18,666	)	$	(345	)	$	(21,205	)
Other comprehensive loss before reclassifications		(6,417	)		(3,608	)		1			(10,024	)
Amounts reclassified from accumulated other comprehensive loss		1,710			—			—			1,710
Balance, May 31, 2016	$	(6,901	)	$	(22,274	)	$	(344	)	$	(29,519	)

The amounts reclassified out of Accumulated other comprehensive loss into the Consolidated Statements of Income, with presentation location, were as follows:

	Three Months Ended May 31,						Nine Months Ended May 31,						Financial Statement Location
(In thousands)	2016			2015			2016			2015
(Gain) loss on derivative financial instruments:
Foreign exchange contracts	$	561		$	(652	)	$	1,203		$	(518	)	Revenue
Interest rate swap contracts		370			442			1,247			1,349		Interest and foreign exchange
		931			(210	)		2,450			831		Total before tax
		(272	)		(44	)		(740	)		(414	)	Tax expense
	$	659		$	(254	)	$	1,710		$	417		Net of tax

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THE GREENBRIER COMPANIES, INC.

Note 9 – Earnings Per Share

The shares used in the computation of the Company’s basic and diluted earnings per common share are reconciled as follows:

(In thousands)	Three Months Ended May 31,				Nine Months Ended May 31,
	2016		2015		2016		2015
Weighted average basic common shares outstanding (1)		29,059		27,842		29,182		27,514
Dilutive effect of 2018 Convertible notes (2)		3,224		5,155		3,202		5,745
Dilutive effect of 2026 Convertible notes (3)		—		3		—		3
Dilutive effect of performance based restricted stock units (4)		59		—		91		—
Weighted average diluted common shares outstanding		32,342		33,000		32,475		33,262

(1) Restricted stock grants and restricted stock units, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position.

(2) The dilutive effect of the 2018 Convertible notes was included for the three and nine months ended May 31, 2016 and 2015 as they were considered dilutive under the “if converted” method as further discussed below.

(3) The dilutive effect of the 2026 Convertible notes was excluded for the three and nine months ended May 31, 2016 as the average stock price was less than the conversion price of $47.15 and therefore was considered anti-dilutive. The effect of the 2026 Convertible notes was included for the three and nine months ended May 31, 2015 as the average stock price was greater than the applicable conversion price, as further described below.

(4) Restricted stock units that are subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position.

Dilutive EPS is calculated using the more dilutive of two approaches. The first approach includes the dilutive effect, using the treasury stock method, associated with shares underlying the 2026 Convertible notes and performance based restricted stock units that are subject to performance criteria, for which actual levels of performance above target have been achieved. The second approach supplements the first by including the “if converted” effect of the 2018 Convertible notes issued in March 2011. Under the “if converted” method, debt issuance and interest costs, both net of tax, associated with the convertible notes are added back to net earnings and the share count is increased by the shares underlying the convertible notes. The 2026 Convertible notes are included in the calculation of both approaches using the treasury stock method when the average stock price is greater than the applicable conversion price.

	Three Months Ended May 31,				Nine Months Ended May 31,
	2016		2015		2016		2015
Net earnings attributable to Greenbrier	$	35,352	$	42,811	$	149,653	$	125,948
Add back:
Interest and debt issuance costs on the 2018 Convertible notes, net of tax		733		1,234		1,962		4,066
Earnings before interest and debt issuance costs on convertible notes	$	36,085	$	44,045	$	151,615	$	130,014
Weighted average diluted common shares outstanding		32,342		33,000		32,475		33,262
Diluted earnings per share (1)	$	1.12	$	1.33	$	4.67	$	3.91

(1) Diluted earnings per share was calculated as follows:

Earnings before interest and debt issuance costs (net of tax) on convertible notes

Weighted average diluted common shares outstanding

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THE GREENBRIER COMPANIES, INC.

Note 10 – Stock Based Compensation

The value of stock based compensation awards is amortized as compensation expense from the date of grant through the earlier of the vesting period or the recipient’s eligible retirement date. Awards are expensed upon grant when the recipient’s eligible retirement date precedes the grant date.

Stock based compensation expense was $8.3 million and $19.1 million for the three and nine months ended May 31, 2016, respectively and $6.0 million and $13.2 million for the three and nine months ended May 31, 2015, respectively. Compensation expense is recorded in Selling and administrative expense and Cost of revenue on the Consolidated Statements of Income.

Note 11 – Derivative Instruments

Foreign operations give rise to market risks from changes in foreign currency exchange rates. Foreign currency forward exchange contracts with established financial institutions are utilized to hedge a portion of that risk. Interest rate swap agreements are used to reduce the impact of changes in interest rates on certain debt. The Company’s foreign currency forward exchange contracts and interest rate swap agreements are designated as cash flow hedges, and therefore the effective portion of unrealized gains and losses is recorded in accumulated other comprehensive income or loss.

At May 31, 2016 exchange rates, forward exchange contracts for the purchase of Polish Zlotys and the sale of Euros and U.S. Dollars; the purchase of Mexican Pesos and the sale of U.S. Dollars; and for the purchase of U.S. Dollars and the sale of Saudi Riyals aggregated to $429.7 million. The fair value of the contracts is included on the Consolidated Balance Sheets as Accounts payable and accrued liabilities when there is a loss, or as Accounts receivable, net when there is a gain. As the contracts mature at various dates through September 2018, any such gain or loss remaining will be recognized in manufacturing revenue or cost of revenue along with the related transactions. In the event that the underlying transaction does not occur or does not occur in the period designated at the inception of the hedge, the amount classified in accumulated other comprehensive loss would be reclassified to the results of operations in Interest and foreign exchange at the time of occurrence.

At May 31, 2016, an interest rate swap agreement maturing in March 2020 had a notional amount of $93.0 million. The fair value of the contract is included in Accounts payable and accrued liabilities on the Consolidated Balance Sheets. As interest expense on the underlying debt is recognized, amounts corresponding to the interest rate swap are reclassified from Accumulated other comprehensive loss and charged or credited to interest expense. At May 31, 2016 interest rates, approximately $1.4 million would be reclassified to interest expense in the next 12 months.

Fair Values of Derivative Instruments

	Asset Derivatives					Liability Derivatives
		May 31, 2016		August 31, 2015			May 31, 2016		August 31, 2015
(In thousands)	Balance sheet location	Fair Value		Fair Value		Balance sheet location	Fair Value		Fair Value
Derivatives designated as hedging instruments
Foreign forward exchange contracts	Accounts receivable, net	$	3,640	$	1,820	Accounts payable and accrued liabilities	$	5,402	$	737
Interest rate swap contracts	Intangibles and other assets, net		—		—	Accounts payable and accrued liabilities		3,437		2,393
		$	3,640	$	1,820		$	8,839	$	3,130
Derivatives not designated as hedging instruments
Foreign forward exchange contracts	Accounts receivable, net	$	—	$	93	Accounts payable and accrued liabilities	$	190	$	76

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THE GREENBRIER COMPANIES, INC.

The Effect of Derivative Instruments on the Statements of Income

Derivatives in cash flow hedging relationships	Location of gain (loss) recognized in income on derivatives	Gain (loss) recognized in income on derivatives nine months ended May 31,
		2016			2015
Foreign forward exchange contract	Interest and foreign exchange	$	(245	)	$	(22	)
Interest rate swap contracts	Interest and foreign exchange		88			69
		$	(157	)	$	47

Derivatives in cash flow hedging relationships	Gain (loss) recognized in OCI on derivatives (effective portion) nine months ended May 31,						Location of gain (loss) reclassified from accumulated OCI into income	Gain (loss) reclassified from accumulated OCI into income (effective portion) nine months ended May 31,						Location of gain on derivative (ineffective portion and amount excluded from effectiveness testing)	Gain recognized on derivative (ineffective portion and amount excluded from effectiveness testing) nine months ended May 31,
	2016			2015				2016			2015				2016		2015
Foreign forward exchange contracts	$	(5,430	)	$	1,867		Revenue	$	(835	)	$	518		Revenue	$	2,572	$	1,024
Foreign forward exchange contracts		(919	)		—		Cost of revenue		(412	)		—		Cost of revenue		88		—
Interest rate swap contracts		(2,274	)		(2,640	)	Interest and foreign exchange		(1,203	)		(1,349	)	Interest and foreign exchange		—		—
	$	(8,623	)	$	(773	)		$	(2,450	)	$	(831	)		$	2,660	$	1,024

Note 12 – Segment Information

Greenbrier operates in four reportable segments: Manufacturing; Wheels & Parts; Leasing & Services; and GBW Joint Venture. The results of GBW Joint Venture are included as part of Earnings from unconsolidated affiliates as the Company accounts for its interest in GBW Railcar Services LLC (GBW) under the equity method of accounting.

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 2015 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 model. 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. 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.

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THE GREENBRIER COMPANIES, INC.

For the three months ended May 31, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	458,494	$	5,595		$	464,089		$	92,713		$	923		$	93,636
Wheels & Parts		78,417		10,058			88,475			5,811			711			6,522
Leasing & Services		75,955		601			76,556			8,298			601			8,899
Eliminations		—		(16,254	)		(16,254	)		—			(2,235	)		(2,235	)
Corporate		—		—			—			(22,693	)		—			(22,693	)
	$	612,866	$	—		$	612,866		$	84,129		$	—		$	84,129

For the nine months ended May 31, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,611,686	$	5,595		$	1,617,281		$	325,215		$	941		$	326,156
Wheels & Parts		247,604		24,074			271,678			15,720			2,155			17,875
Leasing & Services		225,044		10,444			235,488			42,668			10,444			53,112
Eliminations		—		(40,113	)		(40,113	)		—			(13,540	)		(13,540	)
Corporate		—		—			—			(58,596	)		—			(58,596	)
	$	2,084,334	$	—		$	2,084,334		$	325,007		$	—		$	325,007

For the three months ended May 31, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	593,376	$	33		$	593,409		$	115,675		$	—		$	115,675
Wheels & Parts		97,407		7,605			105,012			5,078			607			5,685
Leasing & Services		23,823		11,722			35,545			10,824			11,722			22,546
Eliminations		—		(19,360	)		(19,360	)		—			(12,329	)		(12,329	)
Corporate		—		—			—			(27,166	)		—			(27,166	)
	$	714,606	$	—		$	714,606		$	104,411		$	—		$	104,411

For the nine months ended May 31, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,478,566	$	7,534		$	1,486,100		$	258,602		$	795		$	259,397
Wheels & Parts		286,671		20,450			307,121			20,986			2,044			23,030
Leasing & Services		74,576		43,533			118,109			31,677			43,533			75,210
Eliminations		—		(71,517	)		(71,517	)		—			(46,372	)		(46,372	)
Corporate		—		—			—			(59,900	)		—			(59,900	)
	$	1,839,813	$	—		$	1,839,813		$	251,365		$	—		$	251,365

	Total assets
	May 31,		August 31,
(In thousands)	2016		2015
Manufacturing	$	641,090	$	675,409
Wheels & Parts		301,474		291,798
Leasing & Services		523,989		549,073
Unallocated		319,331		274,232
	$	1,785,884	$	1,790,512

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THE GREENBRIER COMPANIES, INC.

Reconciliation of Earnings from operations to Earnings before income tax and earnings from unconsolidated affiliates:

	Three Months Ended May 31,				Nine Months Ended May 31,
(In thousands)	2016		2015		2016		2015
Earnings from operations	$	84,129	$	104,411	$	325,007	$	251,365
Interest and foreign exchange		3,712		4,285		10,565		9,355
Earnings before income tax and earnings from unconsolidated affiliates	$	80,417	$	100,126	$	314,442	$	242,010

The results of operations for the GBW Joint Venture are accounted for under the equity method of accounting. The GBW Joint Venture is the Company’s fourth reportable segment and information as of May 31, 2016 and August 31, 2015 and for the three and nine months ended May 31, 2016 and 2015 are included in the tables below.

	Three Months Ended May 31,				Nine Months Ended May 31,
(In thousands)	2016		2015		2016		2015
Revenue	$	95,699	$	88,831	$	289,381	$	254,688
Earnings (loss) from operations	$	3,030	$	227	$	9,065	$	(1,507	)
	Total Assets
	May 31, 2016		August 31, 2015
GBW (1)	$	255,400	$	239,871

⁽¹⁾  Includes goodwill and intangible assets of $94.4 million and $96.9 million as of May 31, 2016 and August 31, 2015.

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THE GREENBRIER COMPANIES, INC.

Note 13 – Commitments and Contingencies

The Company’s Portland, Oregon manufacturing facility is located adjacent to the Willamette River. The Company has entered into a Voluntary Cleanup Agreement with the Oregon Department of Environmental Quality (DEQ) in which the Company agreed to conduct an investigation of whether, and to what extent, past or present operations at the Portland property may have released hazardous substances into the environment.

In December 2000, the U.S. Environmental Protection Agency (EPA) classified portions of the Willamette River bed known as the Portland Harbor, including the portion fronting the Company’s manufacturing facility, as a federal “National Priority List” or “Superfund” site due to sediment contamination (the Portland Harbor Site). The Company and more than 140 other parties have received a “General Notice” of potential liability from the EPA relating to the Portland Harbor Site. The letter advised the Company that it may be liable for the costs of investigation and remediation (which liability may be joint and several with other potentially responsible parties) as well as for natural resource damages resulting from releases of hazardous substances to the site. At this time, ten private and public entities, including the Company (the Lower Willamette Group or LWG), have signed an Administrative Order on Consent (AOC) to perform a remedial investigation/feasibility study (RI/FS) of the Portland Harbor Site under EPA oversight, and several additional entities have not signed such consent, but are nevertheless contributing money to the effort. The EPA-mandated RI/FS is being produced by the LWG and has cost over $110 million during a 15-year period. The Company has agreed to initially bear a percentage of the total costs incurred by the LWG in connection with the investigation. The Company’s aggregate expenditure has not been material during the 15-year period. Some or all of any such outlay may be recoverable from other responsible parties.

Eighty-three parties, including the State of Oregon and the federal government, have entered into a non-judicial mediation process to try to allocate costs associated with the Portland Harbor site. Approximately 110 additional parties have signed tolling agreements related to such allocations. On April 23, 2009, the Company and the other AOC signatories filed suit against 69 other parties due to a possible limitations period for some such claims; Arkema Inc. et al v. A & C Foundry Products, Inc. et al, U.S. District Court, District of Oregon, Case #3:09-cv-453-PK. All but 12 of these parties elected to sign tolling agreements and be dismissed without prejudice, and the case has now been stayed by the court, pending the EPA’s Record of Decision, currently scheduled by the EPA for December 31, 2016.

On June 8, 2016, the EPA issued its Feasibility Study (FS) and Proposed Plan for the Portland Harbor Site. The EPA is accepting comments from the public on its Proposed Plan through August 8, 2016. The EPA’s FS includes remediation alternatives that would take from 4 to 62 years of active remediation, with an undiscounted cost ranging from $642 million to $10.2 billion and a net present value assuming a 7% discount rate ranging between $451 million and $9.4 billion. The Proposed Plan identifies the alternative currently favored by the EPA, which it assigns an estimated undiscounted cost of between $1.1 and $1.2 billion and a net present value of between $746 and $811 million. The EPA expects its cost estimates to be accurate within a range of +50 to -30 percent. EPA estimates that the remedy in the Proposed Plan would take 7 years of active remediation followed by 30 years of monitoring. The EPA’s FS and its Proposed Plan identify 13 Sediment Decision Units. One of the units, RM9W, includes the nearshore area of the river sediments offshore of our Portland, Oregon manufacturing facility as well as upstream and downstream of the facility. It also includes a portion of our riverbank. Neither the FS nor the Proposed Plan breaks down total remediation costs by unit.

Neither the EPA’s FS nor its Proposed Plan addresses responsibility for the costs of clean-up, allocates such costs among the potentially responsible parties, or defines precise boundaries for the cleanup. Responsibility for funding and implementing the EPA’s selected cleanup option will be determined after the issuance of the Record of Decision, currently scheduled by the EPA for December 31, 2016. Based on the investigation to date, the Company believes that it did not contribute in any material way to contamination in the river sediments or the damage of natural resources in the Portland Harbor Site and that the damage in the area of the Portland Harbor Site adjacent to its property precedes its ownership of the Portland, Oregon manufacturing facility. Because these environmental investigations are still underway, sufficient information is currently not available to determine the Company’s liability, if any, for the cost of any required remediation or restoration of the Portland Harbor Site or to estimate a range of potential loss. Based on the results of the pending investigations and future assessments of natural resource damages, the Company may be required to incur costs associated with additional phases of investigation or remedial

21

THE GREENBRIER COMPANIES, INC.

action, and may be liable for damages to natural resources. In addition, the Company may be required to perform periodic maintenance dredging in order to continue to launch vessels from its launch ways in Portland, Oregon, on the Willamette River, and the river’s classification as a Superfund site could result in some limitations on future dredging and launch activities. Any of these matters could adversely affect the Company’s business and Consolidated Financial Statements, or the value of its Portland property.

The Company has also signed an Order on Consent with the DEQ to finalize the investigation of potential onsite sources of contamination that may have a release pathway to the Willamette River. Interim precautionary measures are also required in the order and the Company is currently discussing with the DEQ potential remedial actions which may be required. Our aggregate expenditure has not been material, however the Company could incur significant expenses for remediation. Some or all of any such outlay may be recoverable from other responsible parties.

From time to time, Greenbrier is involved as a defendant in litigation in the ordinary course of business, the outcome of which cannot be predicted with certainty. While the ultimate outcome of such legal proceedings cannot be determined at this time, management believes that the resolution of these actions will not have a material adverse effect on the Company’s Consolidated Financial Statements.

In accordance with customary business practices in Europe, the Company has $3.2 million in third party warranty guarantee facilities. To date no amounts have been drawn under these guarantee facilities.

As of May 31, 2016, the Mexican railcar manufacturing joint venture had $0.9 million of third party debt outstanding, for which the Company and its joint venture partner had each guaranteed approximately $0.4 million.

As of May 31, 2016, the Company had outstanding letters of credit aggregating $81.3 million associated with performance guarantees, facility leases and workers compensation insurance.

The Company made $5.3 million in cash contributions and $3.75 million in loans to GBW, an unconsolidated 50/50 joint venture, for the nine months ended May 31, 2016. The Company expects to loan additional amounts of approximately $1.25 million during 2016. The Company is likely to make additional capital contributions or loans to GBW in the future. As of May 31, 2016, the Company had a $35.2 million note receivable balance from GBW which is included on the Consolidated Balance Sheet in Accounts receivable, net.

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THE GREENBRIER COMPANIES, INC.

Note 14 – Fair Value Measures

Certain assets and liabilities are reported at fair value on either a recurring or nonrecurring basis. Fair value, for this disclosure, is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, under a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

Level 1 -	observable inputs such as unadjusted quoted prices in active markets for identical instruments;
Level 2 -	inputs, other than the quoted market prices in active markets for similar instruments, which are observable, either directly or indirectly; and
Level 3 -	unobservable inputs for which there is little or no market data available, which require the reporting entity to develop its own assumptions.

Assets and liabilities measured at fair value on a recurring basis as of May 31, 2016 were:

(In thousands)	Total		Level 1		Level 2 (1)		Level 3
Assets:
Derivative financial instruments	$	3,640	$	—	$	3,640	$	—
Nonqualified savings plan investments		15,093		15,093		—		—
Cash equivalents		5,076		5,076		—		—
	$	23,809	$	20,169	$	3,640	$	—
Liabilities:
Derivative financial instruments	$	9,029	$	—	$	9,029	$	—

(1) Level 2 assets and liabilities include derivative financial instruments that are valued based on observable inputs. See Note 11 Derivative Instruments for further discussion.

Assets and liabilities measured at fair value on a recurring basis as of August 31, 2015 were:

(In thousands)	Total		Level 1		Level 2		Level 3
Assets:
Derivative financial instruments	$	1,913	$	—	$	1,913	$	—
Nonqualified savings plan investments		11,815		11,815		—		—
Cash equivalents		5,071		5,071		—		—
	$	18,799	$	16,886	$	1,913	$	—
Liabilities:
Derivative financial instruments	$	3,206	$	—	$	3,206	$	—

23

THE GREENBRIER COMPANIES, INC.

Note 15 – Related Party Transactions

In April 2010, WLR–Greenbrier Rail Inc. (WLR-GBX) was formed and acquired a lease fleet of nearly 4,000 railcars valued at approximately $256.0 million. WLR-GBX is wholly owned by affiliates of WL Ross & Co, LLC (WL Ross) and a member of the Company’s board of directors, Wendy Teramoto, is also an affiliate of WL Ross. In September 2015, the Company purchased the entire remaining WLR-GBX lease fleet of 3,885 railcars for approximately $148.0 million plus a $1.0 million fee. The transaction was approved by the Company’s disinterested, independent directors. The Company intends to sell the railcars and underlying attached leases to third parties in the short-term and therefore has classified these railcars as Leased railcars for syndication on the Company’s Consolidated Balance Sheet. During the nine months ended May 31, 2016, the Company sold to third parties 3,159 of these railcars with the underlying leases attached for $162.0 million. The Company recognized revenue on 2,766 of these railcars for $154.2 million and deferred revenue recognition on 389 of these railcars for $7.8 million due to the Company’s continuing involvement.

The Company and WL Ross have agreed that the Company will receive a preferred return on the proceeds of the sale of the portfolio, after which it will share a portion of the profits with WL Ross up to certain defined levels. The Company is first entitled to recoup its total investment plus a rate of return of 25%. The Company and WL Ross will then share in the profits up to certain defined levels. Once those defined levels have been met, the Company is entitled to receive 100% of the remaining profits. During the nine months ended May 31, 2016, the Company paid a total of $7.2 million to WL Ross pursuant to this profit sharing agreement and as of May 31, 2016 has accrued an additional $11.3 million that it anticipates will be paid to WL Ross in the future.

24

THE GREENBRIER COMPANIES, INC.

Note 16 – Guarantor/Non-Guarantor

The convertible senior notes due 2026 (the “Notes”) issued on May 22, 2006 are fully and unconditionally and jointly and severally guaranteed by substantially all of Greenbrier’s material 100% owned U.S. subsidiaries: Autostack Company LLC; Greenbrier-Concarril, LLC; Greenbrier Leasing Company LLC; Greenbrier Leasing Limited Partner, LLC; Greenbrier Management Services, LLC; Greenbrier Leasing, L.P.; Greenbrier Railcar LLC; Gunderson LLC; Gunderson Marine LLC; Gunderson Rail Services LLC; Meridian Rail Holding Corp.; Meridian Rail Acquisition Corp.; Meridian Rail Mexico City Corp.; Brandon Railroad LLC; Gunderson Specialty Products, LLC; Greenbrier Railcar Leasing, Inc. and Greenbrier Rail Services Holdings, LLC. No other subsidiaries guarantee the Notes including Greenbrier Union Holdings I LLC; Greenbrier MUL Holdings I LLC; Greenbrier Leasing Limited; Greenbrier Europe B.V.; Greenbrier Europe Holdings B.V.; Greenbrier International Holdings II, LLC; Greenbrier Germany GmbH; WagonySwidnica S.A.; Zaklad Naprawczy Taboru Kolejowego Olawa sp. z o.o.; Zaklad Transportu Kolejowego SIARKOPOL sp. z o.o.; Gunderson-Concarril, S.A. de C.V.; Mexico Meridianrail Services, S.A. de C.V.; Greenbrier Railcar Services – Tierra Blanca S.A. de C.V.; YSD Doors, S.A. de C.V.; Greenbrier do Brasil Participações Ltda; Greenbrier Tank Components, LLC; Gunderson-GIMSA S.A. de C.V.; Greenbrier; S.A. de C.V.; Greenbrier Industries, S.A. de C.V., GBSummit, LLC and Greenbrier-GIMSA, LLC.

The following represents the supplemental consolidating condensed financial information of Greenbrier and its guarantor and non-guarantor subsidiaries, as of May 31, 2016 and August 31, 2015 and for the three and nine months ended May 31, 2016 and 2015. The information is presented on the basis of Greenbrier accounting for its ownership of its wholly owned subsidiaries using the equity method of accounting. The equity method investment for each subsidiary is recorded by the parent in intangibles and other assets. Intercompany transactions of goods and services between the guarantor and non-guarantor subsidiaries are presented as if the sales or transfers were at fair value to third parties and eliminated in consolidation.

25

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Balance Sheet

May 31, 2016

(In thousands, unaudited)

	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	55,717	$	1,263	$	157,460	$	—		$	214,440
Restricted cash		—		1,765		6,904		—			8,669
Accounts receivable, net		3,736		585,797		49,529		(425,552	)		213,510
Inventories		—		272,481		198,455		(12,868	)		458,068
Leased railcars for syndication		—		139,827		—		(3,015	)		136,812
Equipment on operating leases, net		—		232,900		2,709		(2,818	)		232,791
Property, plant and equipment, net		9,139		104,302		204,569		—			318,010
Investment in unconsolidated affiliates		1,367,146		198,977		21,056		(1,497,882	)		89,297
Intangibles and other assets, net		21,185		44,083		14,036		(8,282	)		71,022
Goodwill		—		43,265		—		—			43,265
	$	1,456,923	$	1,624,660	$	654,718	$	(1,950,417	)	$	1,785,884
Liabilities and Equity
Revolving notes	$	—	$	—	$	—	$	—		$	—
Accounts payable and accrued liabilities		449,757		223,954		170,823		(473,882	)		370,652
Deferred income taxes		14,415		54,090		—		(18,115	)		50,390
Deferred revenue		32,732		30,870		281		4,275			68,158
Notes payable		119,933		186,000		875		—			306,808
Total equity - Greenbrier		840,086		1,129,746		332,880		(1,462,626	)		840,086
Noncontrolling interest		—		—		149,859		(69	)		149,790
Total equity		840,086		1,129,746		482,739		(1,462,695	)		989,876
	$	1,456,923	$	1,624,660	$	654,718	$	(1,950,417	)	$	1,785,884

26

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the three months ended May 31, 2016

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	(1,055	)	$	235,613		$	419,441		$	(195,505	)	$	458,494
Wheels & Parts		—			82,292			—			(3,875	)		78,417
Leasing & Services		1,294			74,668			—			(7	)		75,955
		239			392,573			419,441			(199,387	)		612,866
Cost of revenue
Manufacturing		—			216,829			334,498			(198,552	)		352,775
Wheels & Parts		—			73,475			—			(3,657	)		69,818
Leasing & Services		—			63,201			—			(26	)		63,175
		—			353,505			334,498			(202,235	)		485,768
Margin		239			39,068			84,943			2,848			127,098
Selling and administrative expense		22,933			10,672			9,494			181			43,280
Net (gain) loss on disposition of equipment		—			(308	)		254			(257	)		(311	)
Earnings (loss) from operations		(22,694	)		28,704			75,195			2,924			84,129
Other costs
Interest and foreign exchange		2,069			1,910			(83	)		(184	)		3,712
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(24,763	)		26,794			75,278			3,108			80,417
Income tax (expense) benefit		1,460			(7,556	)		(15,244	)		(1,109	)		(22,449	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(23,303	)		19,238			60,034			1,999			57,968
Earnings (loss) from unconsolidated affiliates		58,655			15,452			348			(72,891	)		1,564
Net earnings (loss)		35,352			34,690			60,382			(70,892	)		59,532
Net (earnings) loss attributable to noncontrolling interest		—			—			(22,579	)		(1,601	)		(24,180	)
Net earnings (loss) attributable to Greenbrier	$	35,352		$	34,690		$	37,803		$	(72,493	)	$	35,352

27

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the nine months ended May 31, 2016

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	1,992		$	862,856		$	1,336,226		$	(589,388	)	$	1,611,686
Wheels & Parts		—			252,744			—			(5,140	)		247,604
Leasing & Services		1,354			223,683			1			6			225,044
		3,346			1,339,283			1,336,227			(594,522	)		2,084,334
Cost of revenue
Manufacturing		—			745,419			1,089,603			(587,387	)		1,247,635
Wheels & Parts		—			228,969			—			(4,761	)		224,208
Leasing & Services		—			180,814			—			(77	)		180,737
		—			1,155,202			1,089,603			(592,225	)		1,652,580
Margin		3,346			184,081			246,624			(2,297	)		431,754
Selling and administrative expense		56,825			30,517			30,216			515			118,073
Net (gain) loss on disposition of equipment		—			(10,950	)		256			(632	)		(11,326	)
Earnings (loss) from operations		(53,479	)		164,514			216,152			(2,180	)		325,007
Other costs
Interest and foreign exchange		8,409			5,182			(2,556	)		(470	)		10,565
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(61,888	)		159,332			218,708			(1,710	)		314,442
Income tax (expense) benefit		(2,063	)		(52,706	)		(38,171	)		38			(92,902	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(63,951	)		106,626			180,537			(1,672	)		221,540
Earnings (loss) from unconsolidated affiliates		213,604			29,558			(16	)		(240,225	)		2,921
Net earnings (loss)		149,653			136,184			180,521			(241,897	)		224,461
Net (earnings) loss attributable to noncontrolling interest		—			—			(76,023	)		1,215			(74,808	)
Net earnings (loss) attributable to Greenbrier	$	149,653		$	136,184		$	104,498		$	(240,682	)	$	149,653

28

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	35,352	$	34,690	$	60,382		$	(70,892	)	$	59,532
Other comprehensive income (loss)
Translation adjustment		—		—		1,477			—			1,477
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		230		429			—			659
Unrealized gain on derivative financial instruments		5		3		1,105			—			1,113
Other (net of tax effect)		—		—		7			—			7
		5		233		3,018			—			3,256
Comprehensive income (loss)		35,357		34,923		63,400			(70,892	)		62,788
Comprehensive (income) loss attributable to noncontrolling interest		—		—		(22,594	)		(1,601	)		(24,195	)
Comprehensive income (loss) attributable to Greenbrier	$	35,357	$	34,923	$	40,806		$	(72,493	)	$	38,593

29

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the nine months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	149,653		$	136,184		$	180,521		$	(241,897	)	$	224,461
Other comprehensive income (loss)
Translation adjustment		1,527			—			(3,655	)		(1,527	)		(3,655	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—			746			964			—			1,710
Unrealized loss on derivative financial instruments		(23	)		(1,409	)		(4,985	)		—			(6,417	)
Other (net of tax effect)		—			—			1			—			1
		1,504			(663	)		(7,675	)		(1,527	)		(8,361	)
Comprehensive income (loss)		151,157			135,521			172,846			(243,424	)		216,100
Comprehensive (income) loss attributable to noncontrolling interest		—			—			(75,976	)		1,215			(74,761	)
Comprehensive income (loss) attributable to Greenbrier	$	151,157		$	135,521		$	96,870		$	(242,209	)	$	141,339

30

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Cash Flows

For the nine months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	149,653		$	136,184		$	180,521		$	(241,897	)	$	224,461
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes		15,000			(18,235	)		2,219			(9,127	)		(10,143	)
Depreciation and amortization		2,059			23,314			16,385			(77	)		41,681
Net gain on disposition of equipment		—			(10,950	)		256			(632	)		(11,326	)
Stock based compensation expense		19,055			—			—			—			19,055
Noncontrolling interest adjustment		—			—			—			837			837
Other		—			(32	)		596			—			564
Decrease (increase) in assets:
Accounts receivable, net		45,735			27,389			(27,697	)		(59,760	)		(14,333	)
Inventories		—			(82,518	)		58,013			9,159			(15,346	)
Leased railcars for syndication		—			36,802			—			(7,979	)		28,823
Other		(1,715	)		(1,666	)		(64,522	)		62,712			(5,191	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(48,102	)		(59,664	)		(34,987	)		54,046			(88,707	)
Deferred revenue		32,732			(8,710	)		281			—			24,303
Net cash provided by (used in) operating activities		214,417			41,914			131,065			(192,718	)		194,678
Cash flows from investing activities:
Proceeds from sales of assets		—			88,697			10			—			88,707
Capital expenditures		(2,796	)		(18,480	)		(30,431	)		—			(51,707	)
Decrease (increase) in restricted cash		—			201			(1	)		—			200
Investment in and net advances to unconsolidated affiliates		(176,356	)		(26,977	)		—			194,245			(9,088	)
Cash distribution from unconsolidated affiliates		5,338			—			—			—			5,338
Net cash provided by (used in) investing activities		(173,814	)		43,441			(30,422	)		194,245			33,450
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		(49,000	)		—			—			—			(49,000	)
Proceeds from revolving notes with maturities longer than 90 days		—			—			—			—			—
Repayment of revolving notes with maturities longer than 90 days		—			—			(1,888	)		—			(1,888	)
Repayments of notes payable		(13,981	)		(5,261	)		(219	)		—			(19,461	)
Debt issuance costs		(4,160	)		—			—			—			(4,160	)
Intercompany advances		75,289			(77,270	)		1,981			—			—
Repurchase of stock		(33,498	)		—			—			—			(33,498	)
Dividends		(17,362	)		—			—			—			(17,362	)
Cash contribution to joint venture partner		—			—			(62,710	)		—			(62,710	)
Investment by joint venture partner		—			—			5,400			—			5,400
Excess tax benefit from restricted stock awards		2,786			—			—			—			2,786
Other		—			—			(7	)		—			(7	)
Net cash provided by (used in) financing activities		(39,926	)		(82,531	)		(57,443	)		—			(179,900	)
Effect of exchange rate changes		1,505			(1,680	)		(5,016	)		(1,527	)		(6,718	)
Increase (decrease) in cash and cash equivalents		2,182			1,144			38,184			—			41,510
Cash and cash equivalents
Beginning of period		53,535			119			119,276			—			172,930
End of period	$	55,717		$	1,263		$	157,460		$	—		$	214,440

31

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Balance Sheet

August 31, 2015

(In thousands)

	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	53,535	$	119	$	119,276	$	—		$	172,930
Restricted cash		—		1,966		6,903		—			8,869
Accounts receivable, net		49,471		535,916		24,415		(413,773	)		196,029
Inventories		—		191,625		257,619		(3,709	)		445,535
Leased railcars for syndication		—		228,646		—		(16,112	)		212,534
Equipment on operating leases, net		—		255,130		2,901		(2,640	)		255,391
Property, plant and equipment, net		8,402		102,738		191,995		—			303,135
Investment in unconsolidated affiliates		1,209,698		169,659		21,369		(1,313,456	)		87,270
Intangibles and other assets, net		15,895		46,387		14,235		(10,963	)		65,554
Goodwill		—		43,265		—		—			43,265
	$	1,337,001	$	1,575,451	$	638,713	$	(1,760,653	)	$	1,790,512
Liabilities and Equity
Revolving notes	$	49,000	$	—	$	1,888	$	—		$	50,888
Accounts payable and accrued liabilities		421,249		282,662		208,538		(457,236	)		455,213
Deferred income taxes		—		72,326		—		(11,669	)		60,657
Deferred revenue		—		33,792		—		44			33,836
Notes payable		133,914		191,422		1,093		—			326,429
Total equity Greenbrier		732,838		995,249		296,852		(1,292,101	)		732,838
Noncontrolling interest		—		—		130,342		309			130,651
Total equity		732,838		995,249		427,194		(1,291,792	)		863,489
	$	1,337,001	$	1,575,451	$	638,713	$	(1,760,653	)	$	1,790,512

32

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the three months ended May 31, 2015

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	—		$	280,928		$	492,302		$	(179,854	)	$	593,376
Wheels & Parts		—			98,746			—			(1,339	)		97,407
Leasing & Services		(90	)		23,762			—			151			23,823
		(90	)		403,436			492,302			(181,042	)		714,606
Cost of revenue
Manufacturing		—			230,143			418,273			(182,758	)		465,658
Wheels & Parts		—			91,131			—			(1,486	)		89,645
Leasing & Services		—			10,041			—			(24	)		10,017
		—			331,315			418,273			(184,268	)		565,320
Margin		(90	)		72,121			74,029			3,226			149,286
Selling and administrative expense		24,851			10,688			9,912			144			45,595
Net (gain) loss on disposition of equipment		—			(724	)		7			(3	)		(720	)
Earnings (loss) from operations		(24,941	)		62,157			64,110			3,085			104,411
Other costs
Interest and foreign exchange		3,240			1,649			(604	)		—			4,285
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(28,181	)		60,508			64,714			3,085			100,126
Income tax (expense) benefit		4,215			(26,025	)		(7,888	)		(1,085	)		(30,783	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(23,966	)		34,483			56,826			2,000			69,343
Earnings (loss) from unconsolidated affiliates		66,777			5,142			47			(70,984	)		982
Net earnings (loss)		42,811			39,625			56,873			(68,984	)		70,325
Net earnings attributable to noncontrolling interest		—			—			(26,415	)		(1,099	)		(27,514	)
Net earnings (loss) attributable to Greenbrier	$	42,811		$	39,625		$	30,458		$	(70,083	)	$	42,811

33

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the nine months ended May 31, 2015

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	—		$	877,405		$	1,285,603		$	(684,442	)	$	1,478,566
Wheels & Parts		—			290,917			—			(4,246	)		286,671
Leasing & Services		83			74,064			1			428			74,576
		83			1,242,386			1,285,604			(688,260	)		1,839,813
Cost of revenue
Manufacturing		—			735,414			1,091,498			(641,990	)		1,184,922
Wheels & Parts		—			263,755			—			(4,470	)		259,285
Leasing & Services		—			33,014			—			(72	)		32,942
		—			1,032,183			1,091,498			(646,532	)		1,477,149
Margin		83			210,203			194,106			(41,728	)		362,664
Selling and administrative expense		55,116			26,905			30,169			33			112,223
Net (gain) loss on disposition of equipment		—			(927	)		7			(4	)		(924	)
Earnings (loss) from operations		(55,033	)		184,225			163,930			(41,757	)		251,365
Other costs
Interest and foreign exchange		9,345			4,998			(4,988	)		—			9,355
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(64,378	)		179,227			168,918			(41,757	)		242,010
Income tax (expense) benefit		(4,476	)		(62,438	)		(22,559	)		13,264			(76,209	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(68,854	)		116,789			146,359			(28,493	)		165,801
Earnings (loss) from unconsolidated affiliates		194,802			21,377			142			(214,769	)		1,552
Net earnings (loss)		125,948			138,166			146,501			(243,262	)		167,353
Net (earnings) loss attributable to noncontrolling interest		—			—			(61,992	)		20,587			(41,405	)
Net earnings (loss) attributable to Greenbrier	$	125,948		$	138,166		$	84,509		$	(222,675	)	$	125,948

34

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	42,811	$	39,625		$	56,873		$	(68,984	)	$	70,325
Other comprehensive income (loss)
Translation adjustment		—		(18	)		(1,281	)		—			(1,299	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		275			(529	)		—			(254	)
Unrealized gain (loss) on derivative financial instruments		—		(443	)		550			—			107
Other (net of tax effect)		—		—			93			—			93
		—		(186	)		(1,167	)		—			(1,353	)
Comprehensive income (loss)		42,811		39,439			55,706			(68,984	)		68,972
Comprehensive income attributable to noncontrolling interest		—		—			(26,398	)		(1,099	)		(27,497	)
Comprehensive income (loss) attributable to Greenbrier	$	42,811	$	39,439		$	29,308		$	(70,083	)	$	41,475

35

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the nine months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	125,948	$	138,166		$	146,501		$	(243,262	)	$	167,353
Other comprehensive income (loss)
Translation adjustment		—		(137	)		(10,853	)		—			(10,990	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		837			(420	)		—			417
Unrealized gain (loss) on derivative financial instruments		—		(1,640	)		1,633			—			(7	)
Other (net of tax effect)		—		—			99			—			99
		—		(940	)		(9,541	)		—			(10,481	)
Comprehensive income (loss)		125,948		137,226			136,960			(243,262	)		156,872
Comprehensive (income) loss attributable to noncontrolling interest		—		—			(61,840	)		20,587			(41,253	)
Comprehensive income (loss) attributable to Greenbrier	$	125,948	$	137,226		$	75,120		$	(222,675	)	$	115,619

36

THE GREENBRIER COMPANIES, INC.

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Cash Flows

For the nine months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	125,948		$	138,166		$	146,501		$	(243,262	)	$	167,353
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes		(138	)		(8,000	)		2,893			—			(5,245	)
Depreciation and amortization		1,484			19,909			11,936			(71	)		33,258
Net (gain)loss on disposition of equipment		—			(927	)		7			(4	)		(924	)
Stock based compensation expense		13,176			—			—			—			13,176
Noncontrolling interest adjustments		—			—			—			20,371			20,371
Other		43			105			860			—			1,008
Decrease (increase) in assets:
Accounts receivable, net		50			(10,046	)		37,034			(35,807	)		(8,769	)
Inventories		—			(39,279	)		(87,156	)		1,529			(124,906	)
Leased railcars for syndication		—			(109,324	)		—			18,410			(90,914	)
Other		20,641			763			(33,634	)		10,564			(1,666	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(3,824	)		25,612			9,112			(7,765	)		23,135
Deferred revenue		(122	)		4,078			(276	)		—			3,680
Net cash provided by (used in) operating activities		157,258			21,057			87,277			(236,035	)		29,557
Cash flows from investing activities:
Proceeds from sales of assets		—			4,623			5			—			4,628
Capital expenditures		(2,424	)		(18,807	)		(55,059	)		398			(75,892	)
Decrease (increase) in restricted cash		—			229			(1	)		—			228
Investment in and net advances to unconsolidated affiliates		(245,594	)		(19,966	)		—			235,637			(29,923	)
Cash distribution from unconsolidated affiliates		715			—			—			—			715
Net cash provided by (used in) investing activities		(247,303	)		(33,921	)		(55,055	)		236,035			(100,244	)
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		73,000			—			—			—			73,000
Proceeds from revolving notes with maturities longer than 90 days		—			—			42,563			—			42,563
Repayments of revolving notes with maturities longer than 90 days		—			—			(36,137	)		—			(36,137	)
Repayments of notes payable		(5	)		(5,280	)		(219	)		—			(5,504	)
Intercompany advances		(18,997	)		9,788			9,209			—			—
Repurchase of stock		(48,451	)		—			—			—			(48,451	)
Dividends		(12,069	)		—			—			—			(12,069	)
Decrease in restricted cash		—			11,000			—			—			11,000
Cash distributions to joint venture partner		—			—			(12,489	)		—			(12,489	)
Excess tax benefit from restricted stock awards		2,964			—			—			—			2,964
Other		(248	)		—			—			—			(248	)
Net cash provided by (used in) financing activities		(3,806	)		15,508			2,927			—			14,629
Effect of exchange rate changes		—			(2,269	)		(3,806	)		—			(6,075	)
Increase (decrease) in cash and cash equivalents		(93,851	)		375			31,343			—			(62,133	)
Cash and cash equivalents
Beginning of period		149,747			112			35,057			—			184,916
End of period	$	55,896		$	487		$	66,400		$	—		$	122,783

37

THE GREENBRIER COMPANIES, INC.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Executive Summary

We operate in four reportable segments: Manufacturing; Wheels & Parts; Leasing & Services; and GBW Joint Venture. Our segments are operationally integrated. The Manufacturing segment, operating from facilities in the United States, Mexico and Poland, produces double-stack intermodal railcars, tank cars, conventional railcars, automotive railcar products and marine vessels. The Wheels & Parts segment performs wheel and axle servicing, as well as production of a variety of parts for the railroad industry in North America. The Leasing & Services segment owns approximately 9,200 railcars (5,900 railcars held as equipment on operating leases, 2,400 held as leased railcars for syndication and 900 held as finished goods inventory) and provides management services for approximately 261,000 railcars for railroads, shippers, carriers, institutional investors and other leasing and transportation companies in North America. The GBW Joint Venture segment provides repair services at over 30 locations across North America, including more than 10 tank car repair and maintenance facilities certified by the Association of American Railroads (AAR). The results of these operations were included as part of Earnings (loss) from unconsolidated affiliates as we account for our interest in GBW under the equity method of accounting. We also produce rail castings and tank heads through unconsolidated joint ventures and have a 19.5% ownership stake in a railcar manufacturer in Brazil with an option to acquire an additional 40.5% ownership interest, which can be exercised no later than December 30, 2017.

Our total manufacturing backlog of railcar units as of May 31, 2016 was approximately 31,200 units with an estimated value of $3.62 billion, of which 27,000 units with a value of $3.23 billion are for direct sales and 4,200 units with a value of $0.39 billion are intended for syndications to third parties with a lease attached. Backlog as of May 31, 2015 was approximately 45,100 units with an estimated value of $4.86 billion. Currently, no orders in our May 31, 2016 backlog are intended to be placed into our owned lease fleet. Multi-year supply agreements are a part of rail industry practice. A portion of the orders included in backlog reflects an assumed product mix. Under terms of the orders, the exact mix will be determined in the future, which may impact the dollar amount of backlog. Marine backlog as of May 31, 2016 was $51 million compared to $70 million as of May 31, 2015.

Our backlog of railcar units and marine vessels is not necessarily indicative of future results of operations. Certain orders in backlog are subject to customary documentation and completion of terms. Customer orders contain terms and conditions customary in the industry. Customers may attempt to cancel or modify orders in backlog. Historically little variation has been experienced between the quantity ordered and the quantity actually delivered, though the timing of deliveries has been modified from time to time. Backlog as of May 31, 2016 includes an aggregate of 5,000 covered hopper railcars for use in energy related sand transportation that customers, certain of which are under financial stress, are attempting to cancel, settle or modify. We cannot guarantee that our reported railcar backlog will convert to revenue in any particular period, if at all.

In September 2015, we purchased a portfolio of 3,885 railcars from a related third party for approximately $148.0 million plus a $1.0 million fee. We intend to resell the railcars and underlying attached leases to third parties in the short-term and therefore have classified these railcars as Leased railcars for syndication on our Consolidated Balance Sheet. During the nine months ended May 31, 2016, we sold to third parties 3,159 of these railcars with the underlying leases attached for $162.0 million. We recognized revenue on 2,766 of these railcars for $154.2 million and deferred revenue recognition on 389 of these railcars for $7.8 million due to our continuing involvement. The gross proceeds from the sale of these railcars with leases attached were recorded as revenue and the cost of purchasing these railcars was recorded in cost of revenue within our Leasing & Services segment.

38

THE GREENBRIER COMPANIES, INC.

In May 2016 we announced that we entered into an agreement to acquire a 19.5% ownership interest for $10 million in Amsted-Maxion Fundição e Equipamentos Ferroviários S.A (Amsted-Maxion Cruzeiro), a manufacturer of castings and components for railcars and other heavy equipment. The agreement is subject to customary closing conditions, including antitrust review and is expected to close in the fourth quarter of 2016. Amsted-Maxion Cruzeiro is also the co-owner with us of Amsted-Maxion Equipamentos E Serviços Ferroviários S.A. (Greenbrier-Maxion), a railcar manufacturer in Brazil. We own 19.5% of Greenbrier-Maxion while Amsted-Maxion Cruzeiro owns 80.5%. When we complete the investment in Amsted-Maxion Cruzeiro we will, directly and indirectly, own approximately 35% of Greenbrier-Maxion. As part of this investment, we have an option, subject to certain conditions, to acquire an additional 10% interest in Amsted-Maxion Cruzeiro. Our option expires on October 20, 2017. In 2015, as part of our initial investment in Greenbrier-Maxion, we secured an option to acquire an additional 40.5% direct ownership interest in Greenbrier-Maxion. The option is exercisable until December 30, 2017 and has been modified as part of this current transaction to allow us to purchase a direct ownership interest in Greenbrier-Maxion in an amount between 30.6% and 40.5%, with the option exercise price adjusted in proportion to the ownership interest obtained.

39

THE GREENBRIER COMPANIES, INC.

Three Months Ended May 31, 2016 Compared to Three Months Ended May 31, 2015

Overview

Revenue, cost of revenue, margin and operating profit presented below, include amounts from external parties and exclude intersegment activity that is eliminated in consolidation.

	Three Months Ended May 31,
(In thousands)	2016			2015
Revenue:
Manufacturing	$	458,494		$	593,376
Wheels & Parts		78,417			97,407
Leasing & Services		75,955			23,823
		612,866			714,606
Cost of revenue:
Manufacturing		352,775			465,658
Wheels & Parts		69,818			89,645
Leasing & Services		63,175			10,017
		485,768			565,320
Margin:
Manufacturing		105,719			127,718
Wheels & Parts		8,599			7,762
Leasing & Services		12,780			13,806
		127,098			149,286
Selling and administrative		43,280			45,595
Net gain on disposition of equipment		(311	)		(720	)
Earnings from operations		84,129			104,411
Interest and foreign exchange		3,712			4,285
Earnings before income taxes and earnings from unconsolidated affiliates		80,417			100,126
Income tax expense		(22,449	)		(30,783	)
Earnings before earnings from unconsolidated affiliates		57,968			69,343
Earnings from unconsolidated affiliates		1,564			982
Net earnings		59,532			70,325
Net earnings attributable to noncontrolling interest		(24,180	)		(27,514	)
Net earnings attributable to Greenbrier	$	35,352		$	42,811
Diluted earnings per common share	$	1.12		$	1.33

Performance for our segments is evaluated based on operating profit. 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 model. Management does not allocate Interest and foreign exchange or Income tax expense for either external or internal reporting purposes.

	Three Months Ended May 31,
(In thousands)	2016			2015
Operating profit (loss):
Manufacturing	$	92,713		$	115,675
Wheels & Parts		5,811			5,078
Leasing & Services		8,298			10,824
Corporate		(22,693	)		(27,166	)
	$	84,129		$	104,411

40

THE GREENBRIER COMPANIES, INC.

Consolidated Results

	Three Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	612,866		$	714,606		$	(101,740	)		(14.2	%)
Cost of revenue	$	485,768		$	565,320		$	(79,552	)		(14.1	%)
Margin (%)		20.7	%		20.9	%		(0.2	%)		*
Net earnings attributable to Greenbrier	$	35,352		$	42,811		$	(7,459	)		(17.4	%)

* Not meaningful

Through our integrated business model, we provide a broad range of custom products and services in each of our segments, which have various average selling prices and margins. The demand for and mix of products and services delivered changes from period to period which causes fluctuations in our results of operations.

The 14.2% decrease in revenue for the three months ended May 31, 2016 as compared to the three months ended May 31, 2015 was primarily due to a 22.7% decrease in Manufacturing revenue primarily due to a 24.6% decrease in the volume of railcar deliveries. In addition, the decrease in revenue was attributed to a 19.5% decrease in Wheels & Parts revenue as a result of lower wheel set, component and parts volumes due to a decrease in demand. These were partially offset by a 218.8% increase in Leasing & Services revenue which was primarily the result of the sale of railcars that we purchased from a related third party.

The 14.1% decrease in cost of revenue for the three months ended May 31, 2016 as compared to the three months ended May 31, 2015 was due to a 24.2% decrease in Manufacturing cost of revenue primarily due to a 24.6% decrease in the volume of railcar deliveries. In addition, the decrease in cost of revenue was attributed to a 22.1% decrease in Wheels & Parts cost of revenue due to lower wheel set, component and parts costs associated with decreased volumes. These were partially offset by a 530.7% increase in Leasing & Services cost of revenue which was the result of costs associated with the sale of railcars that we purchased from a related third party.

Margin as a percentage of revenue was 20.7% and 20.9% for the three months ended May 31, 2016 and 2015, respectively. The overall 0.2% decrease in margin percentage was due to a decrease in Leasing & Services margin. Leasing & Services margin decreased to 16.8% from 58.0% primarily as a result of a lower margin percentage on the syndication of railcars purchased from a related third party. This was partially offset by an increase in Manufacturing margin to 23.1% from 21.5% due to a change in product mix. In addition, the decrease in Leasing & Services margin was partially offset by an increase in Wheels & Parts margin to 11.0% from 8.0% primarily due to a more favorable parts product mix in the current year and the adverse effect of declines in scrap metal pricing on wheel margins in the prior year.

The $7.5 million decrease in net earnings for the three months ended May 31, 2016 as compared to the three months ended May 31, 2015 was primarily attributable to a decrease in margin due to lower railcar deliveries.

41

THE GREENBRIER COMPANIES, INC.

Manufacturing Segment

	Three Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	458,494		$	593,376		$	(134,882	)		(22.7	%)
Cost of revenue	$	352,775		$	465,658		$	(112,883	)		(24.2	%)
Margin (%)		23.1	%		21.5	%		1.6	%		*
Operating profit ($)	$	92,713		$	115,675		$	(22,962	)		(19.9	%)
Operating profit (%)		20.2	%		19.5	%		0.7	%		*
Deliveries		4,300			5,700			(1,400	)		(24.6	%)

* Not meaningful

Manufacturing revenue was $458.5 million and $593.4 million for the three months ended May 31, 2016 and 2015, respectively. Manufacturing revenue decreased $134.9 million or 22.7% primarily due to a 24.6% decrease in the volume of railcar deliveries. This was partially offset by a product mix in the current period which had a higher average selling price as compared to the prior comparable period.

Manufacturing cost of revenue was $352.8 million and $465.7 million for the three months ended May 31, 2016 and 2015, respectively. Cost of revenue decreased $112.9 million or 24.2% primarily due to a 24.6% decrease in the volume of railcar deliveries.

Manufacturing margin as a percentage of revenue for the three months ended May 31, 2016 was 23.1% compared to 21.5% for the three months ended May 31, 2015. The 1.6% increase in margin was primarily due to a change in product mix, partially offset by lower volumes of new railcar sales with leases attached which typically result in higher sales prices and margins.

Manufacturing operating profit was $92.7 million or 20.2% of revenue for the three months ended May 31, 2016 and $115.7 million or 19.5% of revenue for the three months ended May 31, 2015. The $23.0 million or 19.9% decrease in operating profit was primarily attributed to a decrease in margin due to lower railcar deliveries.

42

THE GREENBRIER COMPANIES, INC.

Wheels & Parts Segment

	Three Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	78,417		$	97,407		$	(18,990	)		(19.5	%)
Cost of revenue	$	69,818		$	89,645		$	(19,827	)		(22.1	%)
Margin (%)		11.0	%		8.0	%		3.0	%		*
Operating profit ($)	$	5,811		$	5,078		$	733			14.4	%
Operating profit (%)		7.4	%		5.2	%		2.2	%		*

* Not meaningful

Wheels & Parts revenue was $78.4 million and $97.4 million for the three months ended May 31, 2016 and 2015, respectively. The $19.0 million or 19.5% decrease in revenue was primarily a result of lower wheel set, component and parts volumes due to a decrease in demand.

Wheels & Parts cost of revenue was $69.8 million and $89.6 million for the three months ended May 31, 2016 and 2015, respectively. Cost of revenue decreased $19.8 million or 22.1% primarily due to lower wheel set, component and parts costs associated with decreased volumes.

Wheels & Parts margin as a percentage of revenue for the three months ended May 31, 2016 was 11.0% compared to 8.0% for the three months ended May 31, 2015. The increase in margin was primarily due to the adverse effect of declines in scrap metal pricing on wheel margins in the prior year and a more favorable parts product mix in the current year.

Wheels & Parts operating profit was $5.8 million or 7.4% of revenue for the three months ended May 31, 2016 and $5.1 million or 5.2% of revenue for the three months ended May 31, 2015. The $0.7 million or 14.4% increase in operating profit was primarily attributed to the adverse effect of declines in scrap metal pricing on wheel margins in the prior year.

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THE GREENBRIER COMPANIES, INC.

Leasing & Services Segment

	Three Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	75,955		$	23,823		$	52,132			218.8	%
Cost of revenue	$	63,175		$	10,017		$	53,158			530.7	%
Margin (%)		16.8	%		58.0	%		(41.2	%)		*
Operating profit ($)	$	8,298		$	10,824		$	(2,526	)		(23.3	%)
Operating profit (%)		10.9	%		45.4	%		(34.5	%)		*

* Not meaningful

Leasing & Services revenue was $76.0 million and $23.8 million for the three months ended May 31, 2016 and 2015, respectively. The $52.1 million or 218.8% increase in revenue was primarily the result of the sale of railcars for $53.9 million that we purchased from a related third party with the intent to resell them. The gross proceeds from the sale of these railcars with leases attached were recorded as revenue and the cost of purchasing these railcars was recorded in cost of revenue. The increase in revenue was partially offset by a lower average volume of rent-producing leased railcars for syndication, which are held short term and classified as Leased railcars for syndication on our Consolidated Balance Sheet.

Leasing & Services cost of revenue was $63.2 million and $10.0 million for the three months ended May 31, 2016 and 2015, respectively. Cost of revenue increased $53.2 million primarily due to costs associated with the sale of railcars that we purchased from a related third party.

Leasing & Services margin as a percentage of revenue for the three months ended May 31, 2016 was 16.8% compared to 58.0% for the three months ended May 31, 2015. The 41.2% decrease was primarily as a result of a lower margin percentage on the syndication of railcars purchased from a related third party and lower average volume of rent-producing leased railcars for syndication.

Leasing & Services operating profit was $8.3 million or 10.9% of revenue for the three months ended May 31, 2016 and $10.8 million or 45.4% of revenue for the three months ended May 31, 2015. The $2.5 million or 23.3% decrease in operating profit was primarily attributed to a lower average volume of rent-producing leased railcars for syndication partially offset by profit from the sale of railcars that we purchased from a related third party.

The percentage of owned units on lease excluding newly manufactured railcars not yet on lease and a recent railcar portfolio acquisition was 94.9% at May 31, 2016 compared to 98.6% at May 31, 2015.

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THE GREENBRIER COMPANIES, INC.

GBW Joint Venture Segment

GBW, an unconsolidated 50/50 joint venture, generated total revenue of $95.7 million and $88.8 million for the three months ended May 31, 2016 and 2015, respectively. The increase in revenue of $6.9 million was primarily due to a favorable change in mix and an increase in volume.

GBW margin as a percentage of revenue for the three months ended May 31, 2016 was 9.9% compared to 7.4% for the three months ended May 31, 2015. The increase was primarily attributed to an increase in labor efficiencies in the current year.

To reflect our 50% share of GBW’s net results, we recorded earnings of $1.2 million and $0.4 million in Earnings from unconsolidated affiliates for the three months ended May 31, 2016 and 2015, respectively.

Selling and Administrative Expense

	Three Months Ended May 31,				Increase (Decrease)			% Change
(In thousands)	2016		2015
Selling and administrative expense	$	43,280	$	45,595	$	(2,315	)		(5.1	%)

Selling and administrative expense was $43.3 million or 7.1% of revenue for the three months ended May 31, 2016 compared to $45.6 million or 6.4% of revenue for the prior comparable period. The $2.3 million decrease was primarily attributed to costs incurred in the prior year which included $5.8 million in professional fees and other transaction costs in connection with a potential acquisition and $1.7 million in costs associated with our advocacy of new tank car regulations. These were partially offset by a $4.5 million increase in employee-related costs including long-term and short-term incentive compensation, additional headcount and costs associated with a separation and consultation agreement in the current year.

Net Gain on Disposition of Equipment

Net gain on disposition of equipment was $0.3 million for the three months ended May 31, 2016 compared to a net gain on disposition of equipment of $0.7 million for the prior comparable period.

Net gain on disposition of equipment includes the sale of assets from our lease fleet (Equipment on operating leases, net) that are periodically sold in the normal course of business in order to take advantage of market conditions and to manage risk and liquidity and disposition of property, plant and equipment.

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THE GREENBRIER COMPANIES, INC.

Other Costs

Interest and foreign exchange expense was composed of the following:

	Three Months Ended May 31,						Increase (Decrease)
(In thousands)	2016			2015
Interest and foreign exchange:
Interest and other expense	$	3,925		$	5,151		$	(1,226	)
Foreign exchange gain		(213	)		(866	)		653
	$	3,712		$	4,285		$	(573	)

The $0.6 million decrease in interest and foreign exchange expense from the prior comparable period was primarily attributed to a $1.2 million decrease in interest expense as a result of lower average borrowings as compared to the prior year. This was partially offset by a $0.7 million decrease in foreign exchange gain as compared to the prior comparable period primarily attributed to the change in the Mexican Peso relative to the U.S. Dollar.

Income Tax

The tax rate for the three months ended May 31, 2016 was 27.9%, compared to 30.7% for the three months ended May 31, 2015. The decrease in the tax rate was primarily attributable to a change in the proportion of projected pre-tax earnings attributable to our Mexican railcar manufacturing joint venture.

The tax rate can fluctuate period-to-period due to changes in the projected mix of foreign and domestic pre-tax earnings and due to discrete tax items booked within the interim period. It can also fluctuate with changes in the proportion of projected pre-tax earnings attributable to our Mexican railcar manufacturing joint venture because the joint venture is predominantly treated as a partnership for tax purposes and, as a result, the partnership’s entire pre-tax earnings are included in Earnings before income taxes and earnings from unconsolidated affiliates, whereas only our 50% share of the tax is included in Income tax expense.

Earnings From Unconsolidated Affiliates

Earnings from unconsolidated affiliates was $1.6 million for the three months ended May 31, 2016 compared to $1.0 million for the three months ended May 31, 2015. Earnings from unconsolidated affiliates primarily included our share of after-tax results from our GBW Joint Venture including eliminations associated with GBW transactions with other Greenbrier entities and our share of after-tax results from our castings joint venture. In addition, the three months ended May 31, 2016 included our share of after-tax results from our tank head joint venture and our share of after-tax results from our 19.5% ownership stake in a railcar manufacturer in Brazil.

Noncontrolling Interest

Net earnings attributable to noncontrolling interest was $24.2 million for the three months ended May 31, 2016 compared to $27.5 million in the prior comparable period. These amounts primarily represent our joint venture partner’s share in the results of operations of our Mexican railcar manufacturing joint venture, adjusted for intercompany sales. The decrease of $3.3 million from the prior year is primarily a result of a decrease in the volume of railcar deliveries.

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THE GREENBRIER COMPANIES, INC.

Nine Months Ended May 31, 2016 Compared to Nine Months Ended May 31, 2015

Overview

Revenue, cost of revenue, margin and operating profit presented below, include amounts from external parties and exclude intersegment activity that is eliminated in consolidation.

	Nine Months Ended May 31,
(In thousands)	2016			2015
Revenue:
Manufacturing	$	1,611,686		$	1,478,566
Wheels & Parts		247,604			286,671
Leasing & Services		225,044			74,576
		2,084,334			1,839,813
Cost of revenue:
Manufacturing		1,247,635			1,184,922
Wheels & Parts		224,208			259,285
Leasing & Services		180,737			32,942
		1,652,580			1,477,149
Margin:
Manufacturing		364,051			293,644
Wheels & Parts		23,396			27,386
Leasing & Services		44,307			41,634
		431,754			362,664
Selling and administrative		118,073			112,223
Net gain on disposition of equipment		(11,326	)		(924	)
Earnings from operations		325,007			251,365
Interest and foreign exchange		10,565			9,355
Earnings before income taxes and earnings from unconsolidated affiliates		314,442			242,010
Income tax expense		(92,902	)		(76,209	)
Earnings before earnings from unconsolidated affiliates		221,540			165,801
Earnings from unconsolidated affiliates		2,921			1,552
Net earnings		224,461			167,353
Net earnings attributable to noncontrolling interest		(74,808	)		(41,405	)
Net earnings attributable to Greenbrier	$	149,653		$	125,948
Diluted earnings per common share	$	4.67		$	3.91

Performance for our segments is evaluated based on operating profit. 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 model. Management does not allocate Interest and foreign exchange or Income tax expense for either external or internal reporting purposes.

	Nine Months Ended May 31,
(In thousands)	2016			2015
Operating profit (loss):
Manufacturing	$	325,215		$	258,602
Wheels & Parts		15,720			20,986
Leasing & Services		42,668			31,677
Corporate		(58,596	)		(59,900	)
	$	325,007		$	251,365

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THE GREENBRIER COMPANIES, INC.

Consolidated Results

	Nine Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	2,084,334		$	1,839,813		$	244,521			13.3	%
Cost of revenue	$	1,652,580		$	1,477,149		$	175,431			11.9	%
Margin (%)		20.7	%		19.7	%		1.0	%		*
Net earnings attributable to Greenbrier	$	149,653		$	125,948		$	23,705			18.8	%

* Not meaningful

Through our integrated business model, we provide a broad range of custom products and services in each of our segments, which have various average selling prices and margins. The demand for and mix of products and services delivered changes from period to period which causes fluctuations in our results of operations.

The 13.3% increase in revenue for the nine months ended May 31, 2016 as compared to the nine months ended May 31, 2015 was primarily due to a 9.0% increase in Manufacturing revenue. The increase in Manufacturing revenue was primarily due to a 5.4% increase in the volume of railcar deliveries with a mix that had a higher average selling price. In addition, the increase in revenue was due a 201.8% increase in Leasing & Services revenue which was primarily the result of an increase in the sale of railcars that we purchased from a related third party. These were partially offset by a 13.6% decrease in Wheels & Parts revenue as a result of lower wheel set, component and parts volumes due to a decrease in demand and a decrease in scrap metal pricing.

The 11.9% increase in cost of revenue for the nine months ended May 31, 2016 as compared to the nine months ended May 31, 2015 was due to a 5.3% increase in Manufacturing cost of revenue. The increase in Manufacturing cost of revenue was due to an increase of 5.4% in the volume of railcar deliveries with a mix that had a higher average labor and material content. This was partially offset by improved production efficiencies. In addition, the increase in revenue was due a 448.7% increase in Leasing & Services cost of revenue which was primarily the result of an increase in the costs associated with the sale of railcars that we purchased from a related third party. These were partially offset by a 13.5% decrease in Wheels & Parts cost of revenue as a result of lower wheel set, component and parts costs associated with decreased volumes.

Margin as a percentage of revenue was 20.7% and 19.7% for the nine months ended May 31, 2016 and 2015, respectively. The overall 1.0% increase in margin percentage was due to an increase in Manufacturing margin which increased to 22.6% from 19.9% primarily due to a change in product mix and improved production efficiencies. This was partially offset by a decrease in Leasing & Services margin to 19.7% from 55.8% primarily as a result of a lower margin percentage on the syndication of railcars purchased from a related third party. In addition, the increase in Manufacturing margin was partially offset by a decrease in Wheels & Parts margin to 9.4% from 9.6% due to lower wheel set and component volumes and a decrease in scrap metal pricing.

The $23.7 million increase in net earnings for the nine months ended May 31, 2016 as compared to the nine months ended May 31, 2015 was primarily attributable to an increase in margin due to higher railcar deliveries.

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THE GREENBRIER COMPANIES, INC.

Manufacturing Segment

	Nine Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	1,611,686		$	1,478,566		$	133,120			9.0	%
Cost of revenue	$	1,247,635		$	1,184,922		$	62,713			5.3	%
Margin (%)		22.6	%		19.9	%		2.7	%		*
Operating profit ($)	$	325,215		$	258,602		$	66,613			25.8	%
Operating profit (%)		20.2	%		17.5	%		2.7	%		*
Deliveries		15,700			14,900			800			5.4	%

* Not meaningful

Manufacturing revenue was $1.6 billion and $1.5 billion for the nine months ended May 31, 2016 and 2015, respectively. Manufacturing revenue increased $133.1 million or 9.0% primarily due to a 5.4% increase in the volume of railcar deliveries with a product mix in the current period which had a higher average selling price as compared to the prior comparable period.

Manufacturing cost of revenue was $1.2 billion for both the nine months ended May 31, 2016 and 2015, respectively. Cost of revenue increased $62.7 million or 5.3% due to an increase of 5.4% in the volume of railcar deliveries with a mix which had a higher average labor and material content. This was partially offset by improved production efficiencies.

Manufacturing margin as a percentage of revenue for the nine months ended May 31, 2016 was 22.6% compared to 19.9% for the nine months ended May 31, 2015. The 2.7% increase in margin was primarily due to a change in product mix and improved production efficiencies. This was partially offset by lower volumes of new railcar sales with leases attached which typically result in higher sales prices and margins.

Manufacturing operating profit was $325.2 million or 20.2% of revenue for the nine months ended May 31, 2016 and $258.6 million or 17.5% of revenue for the nine months ended May 31, 2015. The $66.6 million or 25.8% increase in operating profit was primarily attributed to an increase in margin due to higher railcar deliveries.

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THE GREENBRIER COMPANIES, INC.

Wheels & Parts Segment

	Nine Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	247,604		$	286,671		$	(39,067	)		(13.6	%)
Cost of revenue	$	224,208		$	259,285		$	(35,077	)		(13.5	%)
Margin (%)		9.4	%		9.6	%		(0.2	%)		*
Operating profit ($)	$	15,720		$	20,986		$	(5,266	)		(25.1	%)
Operating profit (%)		6.3	%		7.3	%		(1.0	%)		*

* Not meaningful

Wheels & Parts revenue was $247.6 million and $286.7 million for the nine months ended May 31, 2016 and 2015, respectively. The $39.1 million or 13.6% decrease in revenue was primarily a result of lower wheel set, component and parts volumes due to a decrease in demand and a decrease in scrap metal pricing.

Wheels & Parts cost of revenue was $224.2 million and $259.3 million for the nine months ended May 31, 2016 and 2015, respectively. Cost of revenue decreased $35.1 million or 13.5% primarily due to lower wheel set, component and parts costs associated with decreased volumes.

Wheels & Parts margin as a percentage of revenue for the nine months ended May 31, 2016 was 9.4% compared to 9.6% for the nine months ended May 31, 2015. The 0.2% decrease in margin was due to lower wheel set and component volumes and a decrease in scrap metal pricing. These were partially offset by a more favorable parts product mix.

Wheels & Parts operating profit was $15.7 million or 6.3% of revenue for the nine months ended May 31, 2016 and $21.0 million or 7.3% of revenue for the nine months ended May 31, 2015. The $5.3 million or 25.1% decrease in operating profit was primarily attributed to a decrease in margin due to a decrease in volumes.

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THE GREENBRIER COMPANIES, INC.

Leasing & Services Segment

	Nine Months Ended May 31,						Increase (Decrease)			% Change
(In thousands)	2016			2015
Revenue	$	225,044		$	74,576		$	150,468			201.8	%
Cost of revenue	$	180,737		$	32,942		$	147,795			448.7	%
Margin (%)		19.7	%		55.8	%		(36.1	%)		*
Operating profit ($)	$	42,668		$	31,677		$	10,991			34.7	%
Operating profit (%)		19.0	%		42.5	%		(23.5	%)		*

* Not meaningful

Leasing & Services revenue was $225.0 million and $74.6 million for the nine months ended May 31, 2016 and 2015, respectively. The $150.5 million or 201.8% increase in revenue was primarily the result of the sale of railcars for $154.2 million that we purchased from a related third party with the intent to resell them. The gross proceeds from the sale of these railcars with leases attached were recorded as revenue and the cost of purchasing these railcars was recorded in cost of revenue. The increase in revenue was also attributed to a higher average volume of rent-producing leased railcars for syndication, which are held short term and classified as Leased railcars for syndication on our Consolidated Balance Sheet.

Leasing & Services cost of revenue was $180.7 million and $32.9 million for the nine months ended May 31, 2016 and 2015, respectively. Cost of revenue increased $147.8 million or 448.7% primarily due to an increase in costs associated with the sale of railcars that we purchased from a related third party.

Leasing & Services margin as a percentage of revenue for the nine months ended May 31, 2016 was 19.7% compared to 55.8% for the nine months ended May 31, 2015. The 36.1% decrease was primarily as a result of a lower margin percentage on the syndication of railcars purchased from a related third party. This was partially offset by a higher average volume of rent-producing leased railcars for syndication.

Leasing & Services operating profit was $42.7 million or 19.0% of revenue for the nine months ended May 31, 2016 and $31.7 million or 42.5% of revenue for the nine months ended May 31, 2015. The $11.0 million or 34.7% increase in operating profit was primarily attributed to an increase in net gain on disposition of equipment and profit from the sale of railcars that we purchased from a related third party.

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THE GREENBRIER COMPANIES, INC.

GBW Joint Venture Segment

GBW, an unconsolidated 50/50 joint venture, generated total revenue of $289.4 million and $254.7 million for the nine months ended May 31, 2016 and 2015, respectively. The increase in revenue of $34.7 million was primarily due an increase in volume and favorable pricing.

GBW margin as a percentage of revenue for the nine months ended May 31, 2016 was 9.8% compared to 6.0% for the nine months ended May 31, 2015. The increase was primarily attributed to an increase in labor efficiencies in the current year. In addition, the prior year included integration and startup costs.

To reflect our 50% share of GBW’s net results, we recorded earnings of $3.3 million and $0.4 million in Earnings from unconsolidated affiliates for the nine months ended May 31, 2016 and 2015, respectively.

Selling and Administrative Expense

	Nine Months Ended May 31,				Increase (Decrease)		% Change
(In thousands)	2016		2015
Selling and administrative expense	$	118,073	$	112,223	$	5,850		5.2	%

Selling and administrative expense was $118.1 million or 5.7% of revenue for the nine months ended May 31, 2016 compared to $112.2 million or 6.1% of revenue for the prior comparable period. The $5.9 million increase was primarily attributed to a $13.5 million increase in employee-related costs including long-term and short-term incentive compensation, additional headcount and costs associated with a separation and consultation agreement. The increase was also attributed to a $3.0 million increase in consulting costs primarily associated with strategic business development and IT initiatives. These were partially offset by costs incurred in the prior year which included $5.8 million in professional fees and other transaction costs in connection with a potential acquisition, $2.4 million in costs associated with our advocacy of new tank car regulations and $1.9 million in legal, accounting and consulting costs associated with the previously disclosed investigation at our Concarril manufacturing facility.

Net Gain on Disposition of Equipment

Net gain on disposition of equipment was $11.3 million for the nine months ended May 31, 2016, compared to $0.9 million for the prior comparable period.

Net gain on disposition of equipment includes the sale of assets from our lease fleet (Equipment on operating leases, net) that are periodically sold in the normal course of business in order to take advantage of market conditions and to manage risk and liquidity and disposition of property, plant and equipment.

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THE GREENBRIER COMPANIES, INC.

Other Costs

Interest and foreign exchange expense was composed of the following:

	Nine Months Ended May 31,						Increase (Decrease)
(In thousands)	2016			2015
Interest and foreign exchange:
Interest and other expense	$	13,474		$	14,917		$	(1,443	)
Foreign exchange gain		(2,909	)		(5,562	)		2,653
	$	10,565		$	9,355		$	1,210

The $1.2 million increase in interest and foreign exchange expense was primarily attributed to a $2.7 million decrease in foreign exchange gain as compared to the prior comparable period primarily attributed to the change in the Mexican Peso relative to the U.S. Dollar. This was partially offset by a $1.4 million decrease in interest expense as a result of lower average borrowings as compared to the prior year.

Income Tax

The tax rate for the nine months ended May 31, 2016 was 29.5%, compared to 31.5% for the nine months ended May 31, 2015. The decrease in the tax rate was primarily attributable to a change in the proportion of projected pre-tax earnings attributable to our Mexican railcar manufacturing joint venture.

The tax rate can fluctuate period-to-period due to changes in the projected mix of foreign and domestic pre-tax earnings and due to discrete tax items booked within the interim period. It can also fluctuate with changes in the proportion of projected pre-tax earnings attributable to our Mexican railcar manufacturing joint venture because the joint venture is predominantly treated as a partnership for tax purposes and, as a result, the partnership’s entire pre-tax earnings are included in Earnings before income taxes and earnings from unconsolidated affiliates, whereas only our 50% share of the tax is included in Income tax expense.

Earnings From Unconsolidated Affiliates

Earnings from unconsolidated affiliates was $2.9 million and $1.6 million for the nine months ended May 31, 2016 and 2015, respectively. Earnings from unconsolidated affiliates primarily included our share of after-tax results from our GBW Joint Venture including eliminations associated with GBW transactions with other Greenbrier entities and our share of after-tax results from our castings joint venture. In addition, the nine months ended May 31, 2016 included our share of after-tax results from our tank head joint venture and our share of after-tax results from our 19.5% ownership stake in a railcar manufacturer in Brazil.

Noncontrolling Interest

Net earnings attributable to noncontrolling interest was $74.8 million for the nine months ended May 31, 2016 compared to $41.4 million in the prior comparable period. These amounts primarily represent our joint venture partner’s share in the results of operations of our Mexican railcar manufacturing joint venture, adjusted for intercompany sales. The increase of $33.4 million from the prior year is primarily a result of the joint venture operating at higher production rates with higher margins and lower volumes of intercompany activity.

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THE GREENBRIER COMPANIES, INC.

Liquidity and Capital Resources

	Nine Months Ended May 31,
(In thousands)	2016			2015
Net cash provided by operating activities	$	194,678		$	29,557
Net cash provided by (used in) investing activities		33,450			(100,244	)
Net cash provided by (used in) financing activities		(179,900	)		14,629
Effect of exchange rate changes		(6,718	)		(6,075	)
Net increase (decrease) in cash and cash equivalents	$	41,510		$	(62,133	)

We have been financed through cash generated from operations and borrowings. At May 31, 2016, cash and cash equivalents were $214.4 million, an increase of $41.5 million from $172.9 million at August 31, 2015.

Cash provided by operating activities was $194.7 million for the nine months ended May 31, 2016 compared to $29.6 million for the nine months ended May 31, 2015. The change from the prior year was primarily due to higher earnings, a change in working capital needs and a change in leased railcars for syndication.

Cash provided by and used in investing activities primarily related to capital expenditures net of proceeds from the sale of assets. Cash provided by investing activities for the nine months ended May 31, 2016 was $33.5 million compared to cash used in investing activities of $100.2 million for the nine months ended May 31, 2015. The change was attributed to higher proceeds from the sale of assets and lower capital expenditures for the nine months ended May 31, 2016 compared to the prior year.

Capital expenditures totaled $51.7 million and $75.9 million for the nine months ended May 31, 2016 and 2015, respectively. Proceeds from the sale of assets, which primarily related to sales of railcars from our lease fleet within Leasing & Services, were approximately $88.7 million and $4.6 million for the nine months ended May 31, 2016 and 2015, respectively. Proceeds from the sale of assets for the nine months ended May 31, 2016 included approximately $37.6 million of equipment that was sold pursuant to a sale and leaseback.

Approximately $35.6 million and $60.6 million of capital expenditures for the nine months ended May 31, 2016 and 2015, respectively were attributable to Manufacturing operations. Capital expenditures for Manufacturing are expected to be approximately $55.0 million in 2016 and primarily relate to maintenance and enhancements of our existing manufacturing facilities.

Approximately $10.3 million and $10.2 million of capital expenditures for the nine months ended May 31, 2016 and 2015, respectively were attributable to Leasing & Services operations and corporate. Leasing & Services and corporate capital expenditures for 2016 are expected to be approximately $30.0 million. Proceeds from sales of leased railcar equipment are expected to be approximately $90.0 million for 2016. Assets from our lease fleet are periodically sold in the normal course of business in order to take advantage of market conditions and to manage risk and liquidity.

Approximately $5.8 million and $5.1 million of capital expenditures for the nine months ended May 31, 2016 and 2015, respectively were attributable to Wheels & Parts operations. Capital expenditures for Wheels & Parts are expected to be approximately $9.0 million in 2016 for maintenance and enhancements of our existing facilities.

Cash used in financing activities was $179.9 million for the nine months ended May 31, 2016 compared to cash provided by financing activities of $14.6 million for the nine months ended May 31, 2015. The change from the prior year was primarily attributed to a decrease in proceeds from debt, net of repayments and an increase in cash distributions to our joint venture partner.

A quarterly dividend of $0.21 per share was declared on June 29, 2016.

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THE GREENBRIER COMPANIES, INC.

Our Notes payable balance was $306.8 million as of May 31, 2016 which includes Convertible senior notes, due 2026 (the 2026 Notes). On specified dates or in the event of certain fundamental changes, holders can require us to repurchase all or a portion of our 2026 Notes at a price equal to 100% of the principal amount of the 2026 Notes plus accrued and unpaid interest (the Put Option). During the three months ended May 31, 2016, we retired $14.0 million of our then $14.9 million outstanding 2026 Notes pursuant to a scheduled Put Option leaving $0.9 million outstanding in 2026 Notes as of May 31, 2016.

Since October 2013, the Board of Directors has authorized our company to repurchase in aggregate up to $225 million of our common stock. During the nine months ended May 31, 2016, we purchased a total of 1,054,687 shares for approximately $32.4 million. As of May 31, 2016 we had cumulatively repurchased 3,206,226 shares for approximately $137.0 million and had $88.0 million available under the share repurchase program with an expiration date of January 1, 2018.

Senior secured credit facilities, consisting of three components, aggregated to $615.5 million as of May 31, 2016. We had an aggregate of $354.2 million available to draw down under committed credit facilities as of May 31, 2016. This amount consists of $288.7 million available on the North American credit facility, $15.5 million on the European credit facilities and $50.0 million on the Mexican railcar manufacturing joint venture credit facilities.

As of May 31, 2016, a $550.0 million revolving line of credit secured by substantially all of our assets in the U.S. not otherwise pledged as security for term loans, maturing October 2020, was available to provide working capital and interim financing of equipment, principally for the U.S. and Mexican operations. Advances under this facility bear interest at LIBOR plus 1.75% or Prime plus 0.75% depending on the type of borrowing. Available borrowings under the credit facility are generally based on defined levels of inventory, receivables, property, plant and equipment and leased equipment, as well as total debt to consolidated capitalization and fixed charges coverage ratios.

As of May 31, 2016, lines of credit totaling $15.5 million secured by certain of our European assets, with various variable rates that range from Warsaw Interbank Offered Rate (WIBOR) plus 1.2% to WIBOR plus 1.3%, were available for working capital needs of the European manufacturing operation. European credit facilities are continually being renewed. Currently these European credit facilities have maturities that range from February 2017 through June 2017.

Our Mexican railcar manufacturing joint venture had two lines of credit totaling $50.0 million. The first line of credit provides up to $30.0 million and is fully guaranteed by us and our joint venture partner. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw against this facility through January 2019. The second line of credit provides up to $20.0 million, of which we and our joint venture partner have each guaranteed 50%. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw amounts available under this facility through August 2017.

As of May 31, 2016, outstanding commitments under the senior secured credit facilities consisted of $81.3 million in letters of credit.

The revolving and operating lines of credit, along with notes payable, contain covenants with respect to us and our various subsidiaries, the most restrictive of which, among other things, limit our ability to: incur additional indebtedness or guarantees; pay dividends or repurchase stock; enter into sale leaseback transactions; create liens; sell assets; engage in transactions with affiliates, including joint ventures and non U.S. subsidiaries, including but not limited to loans, advances, equity investments and guarantees; enter into mergers, consolidations or sales of substantially all our assets; and enter into new lines of business. The covenants also require certain maximum ratios of debt to total capitalization and minimum levels of fixed charges (interest plus rent) coverage. As of May 31, 2016, we were in compliance with all such restrictive covenants.

We may from time to time seek to repurchase or otherwise retire or exchange securities, including outstanding borrowings and equity securities, and take other steps to reduce our debt or otherwise improve our balance sheet. These actions may include open market repurchases, unsolicited or solicited privately negotiated transactions or other retirements, repurchases or exchanges. Such repurchases or exchanges, if any, will depend on a number of factors, including, but not limited to, prevailing market conditions, trading levels of our debt, our liquidity requirements and contractual restrictions, if applicable.

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We have global operations that conduct business in their local currencies as well as other currencies. To mitigate the exposure to transactions denominated in currencies other than the functional currency, we enter into foreign currency forward exchange contracts with established financial institutions to protect the margin on a portion of foreign currency sales in firm backlog. Given the strong credit standing of the counterparties, no provision has been made for credit loss due to counterparty non-performance.

As of May 31, 2016, the Mexican railcar manufacturing joint venture had $0.9 million of third party debt, of which we and our joint venture partner have each guaranteed approximately $0.4 million.

In accordance with customary business practices in Europe, we have $3.2 million in third party warranty guarantee facilities as of May 31, 2016. To date no amounts have been drawn under these guarantee facilities.

We made $5.3 million in cash contributions and $3.75 million in loans to GBW, an unconsolidated 50/50 joint venture, for the nine months ended May 31, 2016. We expect to loan additional amounts of approximately $1.25 million during 2016. We are likely to make additional capital contributions or loans to GBW in the future. As of May 31, 2016, we had a $35.2 million note receivable balance from GBW which is included on the Consolidated Balance Sheet in Accounts receivable, net.

We expect existing funds and cash generated from operations, together with proceeds from financing activities including borrowings under existing credit facilities and long-term financings, to be sufficient to fund dividends, working capital needs, additional investments in GBW, planned capital expenditures and expected debt repayments during the next twelve months.

Off Balance Sheet Arrangements

We do not currently have off balance sheet arrangements that have or are likely to have a material current or future effect on our Consolidated Financial Statements.

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Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. requires judgment on the part of management to arrive at estimates and assumptions on matters that are inherently uncertain. These estimates may affect the amount of assets, liabilities, revenue and expenses reported in the financial statements and accompanying notes and disclosure of contingent assets and liabilities within the financial statements. Estimates and assumptions are periodically evaluated and may be adjusted in future periods. Actual results could differ from those estimates.

Income taxes - For financial reporting purposes, income tax expense is estimated based on amounts anticipated to be reported on tax return filings. Those anticipated amounts may change from when the financial statements are prepared to when the tax returns are filed. Further, because tax filings are subject to review by taxing authorities, there is risk that a position taken in preparation of a tax return may be challenged by a taxing authority. If a challenge is successful, differences in tax expense or between current and deferred tax items may arise in future periods. Any material effect of such differences would be reflected in the financial statements when management considers the effect probable of occurring and the amount reasonably estimable. Valuation allowances reduce deferred tax assets to amounts more likely than not that will be realized based on information available when the financial statements are prepared. This information may include estimates of future income and other assumptions that are inherently uncertain.

Maintenance obligations - We are responsible for maintenance on a portion of the managed and owned lease fleet under the terms of maintenance obligations defined in the underlying lease or management agreement. The estimated maintenance liability is based on maintenance histories for each type and age of railcar. These estimates involve judgment as to the future costs of repairs and the types and timing of repairs required over the lease term. As we cannot predict with certainty the prices, timing and volume of maintenance needed in the future on railcars under long-term leases, this estimate is uncertain and could be materially different from maintenance requirements. The liability is periodically reviewed and updated based on maintenance trends and known future repair or refurbishment requirements. These adjustments could be material due to the inherent uncertainty in predicting future maintenance requirements.

Warranty accruals - Warranty costs to cover a defined warranty period are estimated and charged to operations. The estimated warranty cost is based on historical warranty claims for each particular product type. For new product types without a warranty history, preliminary estimates are based on historical information for similar product types. These estimates are inherently uncertain as they are based on historical data for existing products and judgment for new products. If warranty claims are made in the current period for issues that have not historically been the subject of warranty claims and were not taken into consideration in establishing the accrual or if claims for issues already considered in establishing the accrual exceed expectations, warranty expense may exceed the accrual for that particular product. Conversely, there is the possibility that claims may be lower than estimates. The warranty accrual is periodically reviewed and updated based on warranty trends. However, as we cannot predict future claims, the potential exists for the difference in any one reporting period to be material.

Environmental costs - At times we may be involved in various proceedings related to environmental matters. We estimate future costs for known environmental remediation requirements and accrue for them when it is probable that we have incurred a liability and the related costs can be reasonably estimated based on currently available information. If further developments in or resolution of an environmental matter result in facts and circumstances that are significantly different than the assumptions used to develop these reserves, the accrual for environmental remediation could be materially understated or overstated. Adjustments to these liabilities are made when additional information becomes available that affects the estimated costs to study or remediate any environmental issues or when expenditures for which reserves are established are made. Due to the uncertain nature of environmental matters, there can be no assurance that we will not become involved in future litigation or other proceedings or, if we were found to be responsible or liable in any litigation or proceeding, that such costs would not be material to us.

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THE GREENBRIER COMPANIES, INC.

Revenue recognition - Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable and collectability is reasonably assured.

Railcars are generally manufactured, repaired or refurbished and wheels and parts produced under firm orders from third parties. Revenue is recognized when these products or services are completed, accepted by an unaffiliated customer and contractual contingencies removed. Certain leases are operated under car hire arrangements whereby revenue is earned based on utilization, car hire rates and terms specified in the lease agreement. Car hire revenue is reported from a third party source two months in arrears; however, such revenue is accrued in the month earned based on estimates of use from historical activity and is adjusted to actual as reported. These estimates are inherently uncertain as they involve judgment as to the estimated use of each railcar. Adjustments to actual have historically not been significant. Revenues from construction of marine barges are either recognized on the percentage of completion method during the construction period or on the completed contract method based on the terms of the contract. Under the percentage of completion method, judgment is used to determine a definitive threshold against which progress towards completion can be measured to determine timing of revenue recognition. Under the percentage of completion method, revenue is recognized based on the progress toward contract completion measured by actual costs incurred to date in relation to the estimate of total expected costs. Under the completed contract method, revenue is not recognized until the project has been fully completed.

We will periodically sell railcars with leases attached to financial investors. Revenue and cost of revenue associated with railcars that the Company has manufactured are recognized in Manufacturing once sold. Revenue and cost of revenue associated with railcars which were obtained from a third party with the intent to resell them and subsequently sold are recognized in Leasing & Services. In addition we will often perform management or maintenance services at market rates for these railcars. Pursuant to the guidance in Accounting Standards Codification (ASC) 840-20-40, we evaluate the terms of any remarketing agreements and any contractual provisions that represent retained risk and the level of retained risk based on those provisions. We determine whether the level of retained risk exceeds 10% of the individual fair value of the railcars with leases attached that are delivered. For any contracts with multiple elements (i.e. railcars, maintenance, management services, etc.) we allocate revenue among the deliverables primarily based upon objective and reliable evidence of the fair value of each element in the arrangement. If objective and reliable evidence of fair value of any element is not available, we will use the element’s estimated selling price for purposes of allocating the total arrangement consideration among the elements.

Impairment of long-lived assets - When changes in circumstances indicate the carrying amount of certain long-lived assets may not be recoverable, the assets are evaluated for impairment. If the forecast undiscounted future cash flows are less than the carrying amount of the assets, an impairment charge to reduce the carrying value of the assets to fair value is recognized in the current period. These estimates are based on the best information available at the time of the impairment and could be materially different if circumstances change. If the forecast undiscounted future cash flows exceeded the carrying amount of the assets it would indicate that the assets were not impaired.

Goodwill and acquired intangible assets - We periodically acquire businesses in purchase transactions in which the allocation of the purchase price may result in the recognition of goodwill and other intangible assets. The determination of the value of such intangible assets requires management to make estimates and assumptions. These estimates affect the amount of future period amortization and possible impairment charges.

Goodwill and indefinite-lived intangible assets are tested for impairment annually during the third quarter. Goodwill and indefinite-lived intangible assets are also tested more frequently if changes in circumstances or the occurrence of events indicates that a potential impairment exists. When changes in circumstances, such as a decline in the market price of our common stock, changes in demand or in the numerous variables associated with the judgments, assumptions and estimates made in assessing the appropriate valuation of goodwill indicate the carrying amount of certain indefinite lived assets may not be recoverable, the assets are evaluated for impairment. Among other things, our assumptions used in the valuation of goodwill include growth of revenue and margins, market multiples, discount rates and increased cash flows over time. If actual operating results were to differ from these assumptions, it may result in an impairment of our goodwill.

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The provisions of ASC 350, Intangibles - Goodwill and Other, require that we perform a two-step impairment test on goodwill. In the first step, we compare the fair value of each reporting unit with its carrying value. We determine the fair value of our reporting units based on a weighting of income and market approaches. Under the income approach, we calculate the fair value of a reporting unit based on the present value of estimated future cash flows. Under the market approach, we estimate the fair value based on observed market multiples for comparable businesses. The second step of the goodwill impairment test is required only in situations where the carrying value of the reporting unit exceeds its fair value as determined in the first step. In the second step, we would compare the implied fair value of goodwill to its carrying value. The implied fair value of goodwill is determined by allocating the fair value of a reporting unit to all of the assets and liabilities of that unit as if the reporting unit had been acquired in a business combination and the fair value of the reporting unit was the price paid to acquire the reporting unit. The excess of the fair value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. An impairment loss is recorded to the extent that the carrying amount of the reporting unit goodwill exceeds the implied fair value of that goodwill. The $43.3 million goodwill balance as of May 31, 2016 relates to the Wheels & Parts segment. Goodwill was tested during the third quarter of 2016 and we concluded that goodwill was not impaired.

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Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Currency Exchange Risk

We have global operations that conduct business in their local currencies as well as other currencies. To mitigate the exposure to transactions denominated in currencies other than the functional currency of each entity, we enter into foreign currency forward exchange contracts to protect revenue or margin on a portion of forecast foreign currency sales and expenses. At May 31, 2016 exchange rates, forward exchange contracts the purchase of Polish Zlotys and the sale of Euros and U.S. Dollars; the purchase of Mexican Pesos and the sale of U.S. Dollars; and for the purchase of U.S. Dollars and the sale of Saudi Riyals aggregated to $429.7 million. Because of the variety of currencies in which purchases and sales are transacted and the interaction between currency rates, it is not possible to predict the impact a movement in a single foreign currency exchange rate would have on future operating results.

In addition to exposure to transaction gains or losses, we are also exposed to foreign currency exchange risk related to the net asset position of our foreign subsidiaries. At May 31, 2016, net assets of foreign subsidiaries aggregated $56.5 million and a 10% strengthening of the U.S. Dollar relative to the foreign currencies would result in a decrease in equity of $5.7 million, or 0.7% of Total equity - Greenbrier. This calculation assumes that each exchange rate would change in the same direction relative to the U.S. Dollar.

Interest Rate Risk

We have managed a portion of our variable rate debt with interest rate swap agreements, effectively converting $93.0 million of variable rate debt to fixed rate debt. As a result, we are exposed to interest rate risk relating to our revolving debt and a portion of term debt, which are at variable rates. At May 31, 2016, 69% of our outstanding debt had fixed rates and 31% had variable rates. At May 31, 2016, a uniform 10% increase in variable interest rates would result in approximately $0.2 million of additional annual interest expense.

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THE GREENBRIER COMPANIES, INC.

Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management has evaluated, under the supervision and with the participation of our President and Chief Executive Officer and our Chief Financial Officer, the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this report pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 (the Exchange Act). Based on that evaluation, our President and Chief Executive Officer and our Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective in ensuring that information required to be disclosed in our Exchange Act reports is (1) recorded, processed, summarized and reported in a timely manner, and (2) accumulated and communicated to our management, including our President and Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the quarter ended May 31, 2016 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There is hereby incorporated by reference the information disclosed in Note 13 to Consolidated Financial Statements, Part I of this quarterly report.

Item 1A. Risk Factors

This Form 10-Q should be read in conjunction with the risk factors and information disclosed in our Annual Report on Form 10-K for the year ended August 31, 2015. There have been no material changes in the risk factors described in our Annual Report on Form 10-K for the year ended August 31, 2015, except for the risk factor below.

We have potential exposure to environmental liabilities, which could increase costs or have an adverse effect on results of operations.

We are subject to extensive national, state, provincial and local environmental laws and regulations concerning, among other things, air emissions, water discharge, solid waste and hazardous substances handling and disposal and employee health and safety. These laws and regulations are complex and frequently change. We could incur unexpected costs, penalties and other civil and criminal liability if we fail to comply with environmental laws or permits issued to us pursuant to those laws. We also could incur costs or liabilities related to off-site waste disposal or remediating soil or groundwater contamination at our properties, including these set forth below and in the “Environmental Matters” section of this Report. In addition, future environmental laws and regulations may require significant capital expenditures or changes to our operations.

In addition to environmental, health and safety laws, the transportation of commodities by railcar raises potential risks in the event of a derailment or other accident. Generally, liability under existing law in the U.S. and Canada for accidents such as derailments depends on the negligence of the party. However, for certain hazardous commodities being shipped, strict liability concepts may apply.

Our Portland, Oregon manufacturing facility is located adjacent to the Willamette River. We have entered into a Voluntary Cleanup Agreement with the Oregon Department of Environmental Quality (DEQ) in which we agreed to conduct an investigation of whether, and to what extent, past or present operations at the Portland property may have released hazardous substances to the environment. We are also conducting groundwater remediation relating to a historical spill on the property which preceded our ownership.

The U.S. Environmental Protection Agency (EPA) has classified portions of the river bed of the Portland Harbor, including the portion fronting the Company’s manufacturing facility, as a federal “National Priority List” or “Superfund” site due to sediment contamination (the Portland Harbor Site). We, along with more than 140 other parties, have received a “General Notice” of potential liability from the EPA relating to the Portland Harbor Site. The letter advised us that we may be liable for the costs of investigation and remediation (which liability may be joint and several with other potentially responsible parties) as well as for natural resource damages resulting from releases of hazardous substances to the site. We are part of a group that signed an Administrative Order on Consent (AOC) to perform a remedial investigation/feasibility study (RI/FS) of the Portland Harbor Site under EPA oversight, and several additional entities have not signed such consent, but are nevertheless contributing money to the effort. We have agreed to initially bear a percentage of the total costs incurred in connection with the investigation. We cannot provide assurance that any such costs will be recoverable from third parties.

On June 8, 2016, EPA issued its Feasibility Study (“FS”) and Proposed Plan for the Portland Harbor Site. EPA is accepting comments from the public on its Proposed Plan through August 8, 2016. EPA’s FS includes remediation alternatives that would take from 4 to 62 years of active remediation, with an undiscounted cost ranging from $642 million to $10.2 billion and a net present value assuming a 7% discount rate ranging between $451 million and $9.4 billion. The Proposed Plan identifies the alternative currently favored by EPA, which it assigns an estimated undiscounted cost of between $1.1 and $1.2 billion and a net present value of between $746 and $811 million. EPA expects its cost estimates to be accurate within a range of +50 to -30 percent. EPA estimates that the remedy in the Proposed Plan would take 7 years of active remediation followed by 30 years of monitoring. EPA’s FS and its

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Proposed Plan identify 13 Sediment Decision Units. One of the units, RM9W, includes the nearshore area of the river sediments offshore of our Portland, Oregon manufacturing facility as well as upstream and downstream of the facility. It also includes a portion of our riverbank. Neither the FS nor the Proposed Plan breaks down total remediation costs by unit. Neither the feasibility study nor the Proposed Plan addresses responsibility for the costs of clean-up or allocates such costs among potentially responsible parties. Responsibility for funding and implementing the EPA’s selected cleanup option will be determined after the issuance of the Record of Decision, which is scheduled for December 31, 2016.

We have also signed an Order on Consent with DEQ to finalize the investigation of potential onsite sources of contamination that may have a release pathway to the Willamette River. Interim precautionary measures are also required in the order and we are currently discussing with the DEQ potential remedial actions which may be required. Our aggregate expenditure has not been material during the 14-year period, however, we could incur significant expenses for remediation. Some or all of any such outlay may be recoverable from other responsible parties. However, we cannot assure that any such costs will be recoverable from third parties.

Because these environmental investigations are still underway, sufficient information is currently not available to determine our liability, if any, for the cost of any required remediation of the Portland Harbor Site on our adjacent land or to estimate a range of potential loss. Based on the results of the pending investigations and future assessments of natural resource damages, we may be required to incur costs associated with additional phases of investigation or remedial action, and may be liable for damages to natural resources. In addition, we may be required to perform periodic maintenance dredging in order to continue to launch vessels from our launch ways in Portland, Oregon, on the Willamette River, and the river’s classification as a Superfund site could result in some limitations on future dredging and launch activities. Any of these matters could adversely affect our business and Consolidated Financial Statements, or the value of our Portland property.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Since October 2013, the Board of Directors has authorized the Company to repurchase in aggregate up to $225 million of the Company’s common stock. The program may be modified, suspended or discontinued at any time without prior notice and currently has an expiration date of January 1, 2018. Under the share repurchase program, shares of common stock may be purchased on the open market or through privately negotiated transactions from time-to-time. The timing and amount of purchases will be based upon market conditions, securities law limitations and other factors. The share repurchase program does not obligate the Company to acquire any specific number of shares in any period.

There were no shares repurchased under the share repurchase program during the three months ended May 31, 2016.

Period	Total Number of Shares Purchased		Average Price Paid Per Share (Including Commissions)		Total Number of Shares Purchased as Part of Publically Announced Plans or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
March 1, 2016 – March 31, 2016		—		—		—	$	87,989,491
April 1, 2016 – April 30, 2016		—		—		—	$	87,989,491
May 1, 2016 – May 31, 2016		—		—		—	$	87,989,491
		—				—

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THE GREENBRIER COMPANIES, INC.

Item 6. Exhibits

(a) List of Exhibits:

10.1	Separation and Consulting Agreement between James T. Sharp and the Registrant dated May 10, 2016.
31.1	Certification pursuant to Rule 13a – 14 (a).
31.2	Certification pursuant to Rule 13a – 14 (a).
32.1	Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following financial information from the Company’s Quarterly Report on Form 10-Q for the period ended May 31, 2016 formatted in XBRL (eXtensible Business Reporting Language) and furnished electronically herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Income; (iii) Consolidated Statements of Comprehensive Income; (iv) the Consolidated Statements of Equity; (v) the Consolidated Statements of Cash Flows; and (vi) the Notes to Condensed Consolidated Financial Statements.

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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.

	THE GREENBRIER COMPANIES, INC.
Date: July 6, 2016	By:	/s/ Lorie L. Tekorius
		Lorie L. Tekorius
		Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)

Date: July 6, 2016	By:	/s/ Adrian J. Downes
		Adrian J. Downes
		Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)

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EX-10.1

Exhibit 10.1

SEPARATION AND CONSULTING AGREEMENT

This Separation and Consulting Agreement (“Agreement”) is made effective as of May 10, 2016 (“Effective Date”), by and between The Greenbrier Companies, Inc. (the “Company”) and James T. Sharp (“Sharp”).

RECITAL

The Company and Sharp desire to enter into this Agreement setting forth the terms and conditions relating to Sharp’s retirement from employment with the Company and his potential engagement as a consultant to the Company following his retirement.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, the Company and Sharp agree as follows:

ARTICLE 1

Employment and Separation

1.1 Employment Status. Effective as of December 31, 2016, or such earlier date of termination of employment (referred to herein as the “Retirement Date”), Sharp shall retire from his position as Executive Vice President of the Company, as President of Greenbrier Leasing Company LLC (“GLC”) and shall also resign from all other roles as a director, officer, manager, board member and any other position of any and all subsidiaries of the Company. Except as provided in Section 4.5, this Agreement amends, supersedes and replaces in all respects that certain Employment Agreement between Sharp and the Company, dated August 28, 2012 (the “Sharp Employment Agreement”), and the Sharp Employment Agreement is of no further force or effect. The period beginning on the Effective Date and ending on the Retirement Date will be referred to in this Agreement as the “Employment Term.” The Company may terminate Sharp’s employment for any reason at any time prior to the Retirement Date; however, if the Company terminates Sharp’s employment prior to the Retirement Date the Company shall pay Sharp the sums referenced in Sections 1.4, 1.5 and 1.7 and Sharp shall receive the benefits referenced in Sections 3.1.1, 3.1.2 and 3.8, in each case as if Sharp was employed through December 31, 2016 in the same amounts and on the same payment schedules.

1.2 Position; Duties. During the Employment Term, Sharp shall continue as President of GLC and have the duties and responsibilities attendant to that position as well as such duties and responsibilities as may be reasonably assigned from time to time by the CEO, including principally, the following: (i) succession planning by providing recommendations and any necessary implementation support within GLC; (ii) work on developing a Syndication Investor Priority / Consolidation strategy; (iii) evaluate potential acquisitions or other significant business transactions; and (iv) work on such other projects as are agreed upon from time to time between Sharp and the CEO.

1.3 Performance of Duties. During the Employment Term, Sharp will devote his reasonable full-time energies and efforts exclusively in furtherance of the business of the Company and its affiliates. Sharp will perform his duties during the Company’s normal business hours and at other reasonably necessary times. Sharp will extend his best efforts on behalf of the

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Company and will abide by all policies and decisions made by the Company, as well as all applicable foreign, federal, state and local laws, regulations and ordinances. Sharp will act in the best interest of the Company at all times. Notwithstanding the foregoing, during the last three months of Sharp’s employment he may make reasonable efforts to locate consulting work and/or employment commencing in 2017 or later as long as such efforts do not materially interfere with Sharp performing the duties and responsibilities set forth in section 1.2. Notwithstanding the foregoing, Sharp will be permitted to serve as an outside director on the board of directors of nonprofit, charitable or other entities, provided such entities do not compete with the Company, as provided for and set forth in section 4 of this Agreement, and may participate in other professional, civic, governmental organizations and activities that do not materially affect Sharp’s ability to carry out his duties hereunder.

1.4 Base Salary. As compensation for Sharp’s performance of the duties during the Employment Term, Sharp shall be paid a base salary at a rate of $370,000.00 per year (“Base Salary”), payable in accordance with the Company’s customary payroll practices, less required deductions for state and federal withholding tax, social security and all other employment taxes and payroll deductions.

1.5 Bonus. Sharp will receive a cash performance-based bonus for the fiscal year ending August 31, 2016 pursuant to the Company’s 2016 officer incentive bonus plan (the “2016 Bonus Plan”) as earned and paid in accordance with the terms of the 2016 Bonus Plan.

1.6 Indemnification and D&O Insurance. The Indemnification Agreement, dated December 9, 2008, between Sharp and the Company remains in full force and effect in accordance with its terms. Sharp shall remain as an insured individual for his activities as Executive Vice President of the Company and President of GLC under any Company directors’ and officers’ insurance policy as the Company may have in place from to time.

1.7 Severance Benefits. Following the Retirement Date regardless of Sharp’s employment status on that date and in accordance with the payment terms set forth below, the Company shall pay Sharp a lump sum severance payment equal to the sum of (i) an amount equal to one times Sharp’s annual Base Salary as in effect immediately preceding the Retirement Date, but not less than $370,000, plus (ii) an amount equal to one times the Average Bonus. “Average Bonus” shall mean the average of the annual cash bonuses received by Sharp for fiscal 2016 and fiscal 2015. In accordance with and subject to Section 3.9, such severance payment shall be paid on a date that is not fewer than 180 days or more than 200 days following the Retirement Date, contingent upon Sharp having provided to the Company within 30 days of the Retirement Date a signed comprehensive release of claims against the Company and its affiliates as of the Retirement Date in substantially the form attached as Exhibit A to this Agreement.

ARTICLE 2

Consulting Engagement

2.1 Consulting Status. Upon cessation of his employment with Company, Sharp will become a consultant to the Company. Sharp’s status shall be as an independent contractor, and the Company shall have no authority to supervise the time, manner or place of Sharp’s performance of services as a consultant. Sharp may perform work for other individuals and entities, provided that such work does not interfere with the services he provides to the Company and does not violate any provision of Article 4 below.

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2.2 Consulting Term. Sharp’s consulting term under this Agreement will begin immediately following the expiration of the Employment Term, or the termination of his employment if his employment terminates before December 31, 2016, and shall continue until June 30, 2018 or 18 months after his employment is terminated whichever is earlier (the “Consulting Term”). Notwithstanding any provision of this Agreement to the contrary, the Consulting Term may be terminated at any time prior to the expiration of the Consulting Term by mutual agreement of Sharp and the Company.

2.3 Consulting Fees. As compensation for Sharp’s performance of the duties during the Consulting Term, the Company shall pay Sharp base compensation of $1,000 per month (the “Consulting Fees”). The Company will not withhold any income or payroll taxes from the Consulting Fees, and Consultant will be responsible for all applicable federal, state, local and foreign income and/or payroll taxes due as a result of receipt of the Consulting Fees.

2.4 Consulting Duties. During the Consulting Term, Sharp will be available at reasonable times and in a reasonable manner to discuss transition of responsibilities and related strategic business issues with the CEO and such other senior Company personnel as the CEO may reasonably designate (the “Consulting Services”). Sharp and the Company agree that during the Consulting Term Sharp will generally not be expected to provide Consulting Services for more than 8 hours per month.

ARTICLE 3

Other Compensation and Benefits

3.1 Restricted Stock Units.

3.1.1 During the Employment Term, all unvested time-based Restricted Stock Units (“RSUs”) held by Sharp shall continue to vest in accordance with the terms and conditions of the applicable RSU Agreements (each, an “RSU Agreement”).

3.1.2 On the Retirement Date, the vesting of all unvested time-based RSUs as set forth on the RSU vesting schedule attached as Exhibit B shall immediately accelerate, and such RSUs will become fully vested.

3.1.3 The performance-based RSUs held by Sharp as set forth on Exhibit B which pertain to the performance period ending on August 31, 2016 shall continue to vest based on performance in accordance with the terms and conditions of the applicable RSU Agreement, as determined by the Compensation Committee by November 2016. The performance-based RSUs held by Sharp as set forth on Exhibit B which pertain to the performance period ending on August 31, 2017 will immediately vest at the target performance level on the Retirement Date, and Sharp will be entitled to receive a prorated number of shares, equal to the number of such vested RSUs, multiplied by a fraction, the numerator of which is the number of full and partial months in the Measurement Period during which Sharp remained employed with the Company and the denominator of which is 30.

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3.1.4 Each RSU Agreement described above is deemed to be amended to provide for modified vesting as described above.

3.2 Office/Equipment Support. During the Employment Term and the Consulting Term, the Company shall provide reasonable access to the Company’s offices and administrative support to Sharp as reasonably necessary for Sharp to perform services for the Company. This support includes providing Sharp with a mobile telephone, iPad, and executive assistance support.

3.3 Paid Time Off. During the Employment Term, Sharp shall be entitled to PTO in accordance with the Company’s standard policies and guidelines currently applicable to him.

3.4 401(k). During the Employment Term, Sharp is entitled to participate in the Company’s 401(k) program in the same manner as all other employees and, at the end of such period, shall have the same options available to all other employees under such program.

3.5 Life Insurance.

3.5.1 During the Employment Term, Sharp is entitled to participate in and benefit from the Company’s group term life insurance coverage in the same manner as all other employees and, at the end of such period, shall have the options available to all other employees under such program.

3.5.2 During the Employment Term, the Company shall continue in force the existing life insurance coverage insuring Sharp’s life (the “Supplemental Policy”). The Company shall continue to own the Supplemental Policy and shall endorse the death benefit to Sharp.

3.5.3 Sharp shall continue to own one or more supplemental life insurance policies owned by him (the “Prior Policy”) which were issued under a prior executive life insurance program under which the Company previously paid the cost of premiums, which program was replaced by the program for the Supplemental Policy.

3.5.4 Upon the Retirement Date, the Company shall transfer to Sharp ownership of the Supplemental Policy, including without limitation the right to the cash surrender value of the Supplemental Policy, on the date that is six months after the date of Sharp’s separation from service, as that term is defined in Treas. Reg. §1.409A-1(h).

3.6 Medical Insurance. During the Employment Term and the Consulting Term, Sharp will be eligible to participate in, subject to Sharp’s continued payment of his portion of such premiums, all employee benefit plans available to full-time, executive employees of the Company, subject to the terms and conditions of the Company’s benefit plans, including health, dental and vision insurance benefits. Following the cessation of the Consulting Term, for a period not to exceed 18 months following termination of Sharp’s status as a consultant of the Company, the Company shall provide for continuation coverage pursuant to COBRA for Sharp and/or his spouse provided that Sharp pays the Company an amount equal to the applicable premium for employee health benefits that Sharp would pay as an employee of the Company. “COBRA” refers to the Consolidated Omnibus Budget Reconciliation Act of 1985. Once Sharp is no longer eligible for COBRA coverage, and if Sharp is not yet eligible for Medicare, then, until Sharp reaches the age of Medicare eligibility, the Company will make cash payments to Sharp in an amount equal to the reasonable cost of purchasing health insurance for Sharp and his spouse and/or, as applicable, Medicare Supplemental Coverage for Sharp’s spouse. The Company reserves the right to change or eliminate its medical benefits applicable to all employees and to Sharp on a prospective basis without advance notice to Sharp.

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3.7 Automobile Allowance. During the Employment Term and for a period of two years following the Retirement Date, Sharp shall be entitled to participate in the Company’s automobile allowance program at the same level he participates as of the Effective Date.

3.8 Nonqualified Deferred Compensation Plan Contribution. Following the Retirement Date, Sharp will no longer be eligible to receive Company contributions under the Company’s Nonqualified Deferred Compensation Plan. However, in exchange for his services to the Company during 2016 as provided for herein, Sharp shall be eligible to receive twice the amount of Company contributions under the Company’s Nonqualified Deferred Compensation Plan for fiscal 2016 that Sharp would have received under the terms of such plan. Such payments will be calculated as a percentage of Sharp’s Base Salary paid during fiscal 2016, and will be paid at the same time that the Company’s contributions are made to the Nonqualified Deferred Compensation Plan’s other participants, which are expected to be made in January or February 2017. The payments and contributions under this section are contingent upon Sharp having provided to the Company prior to any contributions being made a signed comprehensive release of claims against the Company and its affiliates as of the contribution date in substantially the form attached as Exhibit A to this Agreement.

3.9 IRS Section 409A. The parties intend that all compensation and benefits provided for under this Agreement shall either be exempt from IRC §409A, or shall be paid or provided in accordance with the requirements of IRC §409A, including, without limitation, the imposition of a delay in the payment of cash or transfer of other benefits to Sharp until a date that is six months after the date of Sharp’s separation from service, as that term is defined in Treas. Reg. §1.409A-1(h), if Sharp is determined to be a “specified employee” as defined under IRC §409A.

3.10 SEC Compliance. During the Employment Term, Sharp shall comply, to the extent applicable, with all requirements of Section 16 of the Securities Exchange Act of 1934 and the Company’s insider trading policies and procedures.

ARTICLE 4

Restrictive Covenants

4.1 Protected Information.

4.1.1 Covenant. During and after expiration of Sharp’s Employment Term and Consulting Term, Sharp shall not, directly or indirectly, use, divulge, furnish or make accessible to any person, firm, corporation, association or other entity, or use in any manner, any Protected Information (as defined below), or cause any Protected Information to enter the public domain, except as may be required in the regular course of Sharp’s engagement by the Company.

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4.1.2 Access to Protected Information. The Company has advised Sharp and Sharp has acknowledged that it is the policy of the Company to maintain as secret and confidential all Protected Information, and that Protected Information has been and will be developed at substantial cost and effort to the Company. Sharp acknowledges that Sharp will acquire Protected Information with respect to the Company, which information is a valuable, special, and unique asset of the Company’s business and operations, and that disclosure of such Protected Information would cause irreparable damage to the Company.

4.1.3 Sharp-Created Protected Information. Sharp agrees to promptly disclose to the Company all Protected Information developed in whole or in part by Sharp during his employment and/or consulting engagement with the Company and that relates to the Company’s business. Such Protected Information is, and shall remain, the exclusive property of the Company. All Protected Information created during Sharp’s employment and/or consulting engagement with the Company (excluding writings unrelated to the Company’s business) is considered to be “works-for-hire” for the benefit of the Company, and the Company shall own all rights in such Protected Information.

4.1.4 Return of Confidential Records. All forms of information and all physical property made or compiled by Sharp prior to or during the Employment Term and the Consulting Term containing or relating in any way to Protected Information shall be the Company’s exclusive property. All such materials and any copies thereof shall be held by Sharp in trust solely for the benefit of the Company and shall be delivered to the Company upon expiration of Sharp’s employment and/or consulting engagement, or at any other time upon the Company’s request.

4.1.5 Protected Information. “Protected Information” means trade secrets, confidential and proprietary business information of the Company, any information of the Company other than information that has entered the public domain (unless Sharp caused such information to enter the public domain), and all valuable and unique information and techniques acquired, developed or used by the Company relating to its business, operations, employees, customers and suppliers, which give the Company a competitive advantage over those who do not know the information and techniques, and which are protected by the Company from unauthorized disclosure, including but not limited to, financial information and conditions, customer and customer lists (including potential customers identified by the Company), sources of supply, processes, patented or proprietary technologies, plans, materials, pricing information, internal memoranda, marketing plans, internal policies, and products and services which may be developed from time to time by the Company and its agents or employees.

4.2 Non-Solicitation. Sharp agrees that, during his Employment Term and for a period of two (2) years after the expiration of his employment, including extensions thereto, or the earlier termination of this Agreement, Sharp will not directly or knowingly through others, in any capacity, persuade or seek to persuade any customer, syndication investor, or vendors of the Company or its affiliates to cease to do business or reduce the amount of business that customer or vendor is then doing with the Company or its affiliates, or to enter into a strategic alliance or railcar equipment buying program with another railcar manufacturer, in each case other than in the normal course of business relating to Sharp’s employment with a company not covered by the restrictions defined in Section 4.5. For purposes of section 4.2 and 4.3, the two year period of restriction shall encompass the Consulting Term and not be in addition to said Term.

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4.3 Non-Interference with Employment Relationships. Sharp agrees that during his Employment Term and for a period of two (2) years after the expiration of Sharp’s employment, including extensions thereto, or the earlier termination of this Agreement, Sharp will not (a) directly or knowingly through others solicit or induce any employee of the Company to leave his or her employment with the Company to be hired by any company or entity that employs Sharp or for which Sharp is a consultant, or (b) hire or assist any other person to hire any person who has been an employee of the Company within the previous nine (9) months from the potential hiring date.

4.4 Disclosure of Business Opportunities. During the Employment Term and the Consulting Term, Sharp agrees to promptly and fully disclose to the Company, and not to divert to his own use or benefit or the use or benefit of others, any business opportunities involving any existing or prospective line of business, customer, product or activity of the Company or any business opportunities that otherwise should be afforded to the Company.

4.5 Non-Competition. The parties acknowledge and agree that Section 5 of the Employment Agreement will remain in full force and effect, and that this Section 4.5 amends and clarifies Section 5 of the Employment Agreement as follows: As a condition of Sharp’s severance benefits under Section 1.7 and Section 3.8 of this Agreement and his consulting engagement under Article 2 of this Agreement, Sharp agrees that for a period of two (2) years after the Retirement Date, inclusive of any Consulting Term, Sharp will not directly or indirectly, own (as an asset or equity owner), be employed by, or consult for any individual or entity, or participate in the start-up of, any business that (i) manufactures railcars, railcar components or barges in North America, Europe, Brazil or the GCC countries; (ii) directly or physically maintains or repairs railcars or railcar parts and components in North America, Europe, Brazil, or the GCC countries; (iii) leases railcars, provided that this subjection 4.5(iii) will only apply to leasing businesses that are affiliates or captive leasing companies of any of the foregoing or any other freight railcar manufacturer or any other company listed on a list to be agreed upon by the parties; or (iv) provides services related to management of railcars in North America as a business that represents at least 25% of the overall revenue of the entity and in a similar manner to that currently provided by the Company and its affiliates. This Section does not prevent Sharp from working for agreed upon railcar management companies, railcar leasing companies, and suppliers for either employment or consulting engagements, provided that the CEO consents to such a relationship after consultation with Sharp and based on the CEO’s determination in his reasonable good faith discretion that such a relationship does not create a material or significant conflict of interest or harm to the Company. In addition, Sharp may work for the companies listed on a list to be agreed upon by the parties, provided those companies continue to have a contractual relationship with the Company and have not publicly announced a strategic alliance or railcar equipment order with another railcar manufacturing company (i) at the time of Sharp’s acceptance of employment or consulting with such company or (ii) at any time during the period that is within two years of Sharp’s Retirement Date. Ownership of one percent (1%) or less of the outstanding stock of a publicly traded corporation will not be deemed a violation of this provision. Sharp acknowledges that the geographic scope of this restriction is reasonably necessary to protect the Company’s legitimate interests, particularly in light of Sharp’s position with the Company, Sharp’s corresponding duties, responsibilities and authority, and the Company’s current business plans and expansion efforts. Notwithstanding the foregoing, Company will, on request of Sharp, give reasonable good faith consideration to waiving all or a

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portion of the covenant to enable Sharp to obtain new employment, provided Sharp furnishes the Company with the name of the employer, a description of the employer’s business and the job description, and such other information as the Company may reasonably request. The Company will consider waiving all or a portion of the covenants if the Company determines, in its good faith judgment, that the new employment does not pose a substantial threat to the Company’s competitive or economic interest. Sharp expressly acknowledges that all compensation, bonuses, and benefits provided under Articles 1, 2 and 3 are contingent upon and subject to Sharp’s compliance with this Article 4, and that any unearned or unpaid compensation, bonuses and benefits provided in section 1.7 or Article 3 will be repaid to the Company as liquidated damages and not as a penalty in the event of Sharp’s proven noncompliance with this Article 4.

4.6 Publicity. Except as otherwise required by law, the parties agree to work together regarding any public announcement related to this Agreement and the covenants herein. The parties will cooperate and coordinate messaging and issuance of any press release, including internal communication regarding Sharp’s ongoing role and transition within the Company.

4.7 Non-Disparagement. Sharp agrees not to disparage the Company or its officers, directors, employees, shareholders or agents, in any manner likely to be harmful to them or their business, business relationships or personal reputations. Sharp shall respond accurately and fully to any questions, inquiry or request for information when required by legal process, notwithstanding the foregoing. Sharp will report to the CEO any defamatory comments made about him by any individual Company employee or agent, and the Company will take reasonable measures to cease such communications.

4.8 Cooperation. Sharp agrees that during his Employment Term and Consulting Term, including extensions thereto, or the earlier termination of this Agreement, Sharp will cooperate with the Company in responding to the reasonable requests of the Board, the Company or its General Counsel, in connection with outstanding projects and any and all existing or future litigation, arbitrations, mediations or investigations brought by or against the Company, or its affiliates, agents, officers, directors or employees, whether administrative, civil or criminal in nature, in which the Company reasonably deems Sharp’s cooperation necessary or desirable. In such matters, Sharp agrees to provide the Company with reasonable advice, assistance, and information, including offering and explaining evidence, providing sworn statements, and participating in discovery and trial preparation and testimony. Sharp also agrees to promptly send the Company copies of all correspondence (for example, but not limited to, subpoenas) received by Sharp in connection with any such legal proceedings, unless Sharp is expressly prohibited by law from so doing. The Company will reimburse Sharp for reasonable out-of-pocket expenses incurred by Sharp as a result of his cooperation with the obligations described in this Section, within 30 days of the presentation of appropriate documentation thereof, in accordance with the Company’s standard reimbursement policies and procedures.

4.9 Survival of Undertakings and Injunctive Relief.

4.9.1 Survival. The provisions of Sections 4.1, 4.2, 4.3, 4.4, 4.5, 4.6, 4.7 and 4.8 shall survive the expiration of Sharp’s employment and/or consulting engagement, or the earlier termination of this Agreement (irrespective of the reasons therefore). In the event of any proven violation of Sections 4.1, 4.2, 4.3, 4.4, and 4.5 Sharp further agrees that the time periods set forth in such sections shall be extended by the period of such violation.

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4.9.2 Injunctive Relief. Sharp acknowledges and agrees that the restrictions imposed upon him by this Article 4 and the purpose of such restrictions are reasonable and are designed to protect the Protected Information and the continued success of the Company without unduly restricting Sharp’s future employment by himself or others. Furthermore, Sharp acknowledges that, in view of the Protected Information which Sharp has or will acquire or has or will have access to, and in view of the necessity of the restrictions contained in this Article 4 any violation of any provision of this Article 4 hereof would cause irreparable injury to the Company with respect to the resulting disruption in its operations. By reason of the foregoing, Sharp consents and agrees that if he violates any of the provisions of this Article 4, the Company shall be entitled, in addition to any other remedies that it may have, including money damages, to an injunction to be issued by a court of competent jurisdiction, restraining Sharp from committing or continuing any violation of such sections of this Agreement.

4.10 References to the Company. All references to the Company in this Article 4 shall be deemed to include any subsidiary, parent, successor in interest, or other affiliate of the Company.

ARTICLE 5

Release of Claims

5.1 Release. In exchange for and in consideration of the payments, benefits, and other commitments described herein, including but not limited to Sharp’s continued employment by the Company, as provided by Article 1, and consulting engagement with the Company, as provided by Article 2, Sharp, for him and for each of his heirs, executors, administrators and assigns, hereby fully releases, acquits and forever discharges the Company and its subsidiaries, divisions, affiliates, successors, assigns, beneficiaries, insurers, representatives, agents, and all of the Company’s past and present directors, officers and employees, from any and all, both past and present, claims, liabilities, causes of action, demands to any rights, damages, costs, attorneys’ fees, expenses and compensation whatsoever, of whatever kind or nature, in law, equity or otherwise, whether known or unknown, vested or contingent, suspected or unsuspected, that Sharp may now have, has ever had, or hereafter may have, relating directly or indirectly to his employment with the Company or its subsidiaries and/or his termination of employment that arose prior to the date Sharp executes this Agreement. Sharp also releases any and all other claims Sharp may have that arose prior to the date of this Agreement and hereby specifically waives and releases all claims, including, but not limited to, those arising under Title VII of the Civil Rights Act of 1964; the Civil Rights Act of 1991; the Equal Pay Act; the Americans With Disabilities Act of 1990; the Rehabilitation Act of 1973; Sections 1981 through 1988 of Title 42 of the United States Code; the Immigration Reform and Control Act; the Workers Adjustment and Retraining Notification Act; the Occupational Safety and Health Act; the Sarbanes-Oxley Act of 2002; the Consolidated Omnibus Budget Reconciliation Act (COBRA); the Family and Medical Leave Act; the Employee Retirement Income Security Act of 1971; the National Labor Relations Act; the Fair Labor Standards Act; the Genetic Information Nondiscrimination Act (GINA); all as amended, and any and all similar state or local statutes, ordinances, or regulations, as well as all claims arising under federal, state, or local law involving any tort, an express or implied employment contract, covenant of good faith and fair dealing or other statute, contract, breach of fiduciary duty, fraud, misrepresentation, defamation or other theory. Notwithstanding the foregoing, Sharp is not waiving any right that cannot be waived under law, including the right to file an administrative charge or participate in an administrative investigation or

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proceeding; however, Sharp hereby disclaims and waives any right to share or participate in any monetary award resulting from the prosecution of such charge or investigation or proceeding. Nothing in this Section 5.1 shall release any rights Sharp may have to benefits vested prior to the date hereof in the Company’s Target Benefit Plan, Nonqualified Deferred Compensation Plan or 401(k) plan or to vested post-employment health or group insurance benefits.

ARTICLE 6

Miscellaneous

6.1 Assignment and Transfer. Sharp’s rights and obligations under this Agreement shall not be transferable by assignment or otherwise, and any purported assignment, transfer or delegation thereof shall be void. This Agreement shall inure to the benefit of, and be binding upon and enforceable by, any purchaser of substantially all of the Company’s assets, any corporate successor to the Company or any assignee thereof.

6.2 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Oregon without regard to conflict of law principles.

6.3 Entire Agreement. Except as specifically set forth below, this Agreement, together with the amendment to the RSU Agreements, contains the entire agreement and understanding between the parties hereto and supersedes any prior or contemporaneous written or oral agreements, representations and warranties between them respecting the subject matter hereof.

6.4 Amendment. This Agreement may be amended only in writing signed by Sharp and by a duly authorized executive officer of the Company.

6.5 Severability. If any term, provision, covenant or condition of this Agreement, or the application thereof to any person, place or circumstance, shall be held to be invalid, unenforceable or void, the remainder of this Agreement and such term, provision, covenant or condition as applied to other persons, places and circumstances shall remain in full force and effect.

6.6 Notices. Any notice, request, consent or approval required or permitted to be given under this Agreement or pursuant to law shall be sufficient if in writing, and if and when sent by certified or registered mail, with postage prepaid, to Sharp’s residence (as noted in the Company’s records), or to the Company’s principal office, as the case may be.

6.7 Disputes. Any controversy, claim or dispute arising out of or relating to this Agreement or the employment and/or consulting relationship, either during the existence of the employment and/or consulting relationship or afterwards, between the parties hereto, their assignees, their affiliates, their attorneys, or agents, shall be litigated solely in state or federal court in Multnomah County, Oregon. Each party (a) submits to the jurisdiction of such court, (b) waives the defense of an inconvenient forum, (c) agrees that valid consent to service may be made by mailing or delivery of such service to the Oregon Secretary of State (the “Agent”) or to the party at the party’s last known address, if personal service delivery cannot be easily effected, and (d) authorizes and directs the Agent to accept such service in the event that personal service delivery cannot easily be effected.

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date set forth below.

THE GREENBRIER COMPANIES, INC.
By: /s/ Martin R. Baker	/s/ James T. Sharp
Title: Senior Vice President & General Counsel	JAMES T. SHARP
Dated: May 10, 2016	Dated: May 10, 2016

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EXHIBIT A

RELEASE OF CLAIMS

James T. Sharp, together with his heirs, family members, executors, administrators, agents and assigns (“Sharp”) hereby fully releases, acquits and forever discharges The Greenbrier Companies, Inc., (“Greenbrier”) its subsidiaries, affiliates, officers, directors, shareholders, employees, agents and attorneys, both past and present (collectively, the “Released Parties” and individually, a “Released Party”) from any and all claims, liabilities, causes of action, demands to any rights, costs, attorneys’ fees, expenses and compensation whatsoever, of whatever kind or nature, in law, equity or otherwise, whether known or unknown, vested or contingent, suspected or unsuspected, that Sharp may now have, has ever had, or hereafter may have, relating directly or indirectly to his employment with Greenbrier and/or his termination of employment that arose prior to the date Sharp signs this release.

Sharp also releases any and all claims Sharp may have that arose prior to the date of this Release and hereby specifically waives and releases all claims against any Released Party, including without limitation those arising under Title VII of the Civil Rights Act of 1964; the Civil Rights Act of 1991; the Equal Pay Act; the Americans With Disabilities Act of 1990; the Rehabilitation Act of 1973; the Age Discrimination in Employment Act; Sections 1981 through 1988 of Title 42 of the United States Code; the Immigration Reform and Control Act; the Workers Adjustment and Retraining Notification Act; the Occupational Safety and Health Act; the Sarbanes-Oxley Act of 2002; the Consolidated Omnibus Budget Reconciliation Act (COBRA); the Family and Medical Leave Act; the Employee Retirement Income Security Act of 1971; the National Labor Relations Act; the Fair Labor Standards Act; all as amended, and any and all similar state or local statutes, ordinances, or regulations, as well as all claims arising under federal, state, or local law involving any tort, an express or implied employment contract, covenant of good faith and fair dealing or other statute, contract, breach of fiduciary duty, fraud, misrepresentation, defamation or other theory. Nothing in this Release shall release any rights Sharp may have to benefits vested prior to the date hereof in the Company’s Target Benefit Plan, Nonqualified Deferred Compensation Plan or 401(k) plan or to vested post-employment health or group health insurance benefits.

This release includes a release of all claims under the Age Discrimination in Employment Act (“ADEA”), and, therefore, pursuant to the requirement of the ADEA, Sharp acknowledges that he has been advised in writing that: (a) this release includes, but is not limited to, all rights or claims arising under the ADEA up to and including the date of execution of this release; (b) Sharp should consult with an attorney before executing this release; (c) Sharp has up to twenty-one (21) days within which to consider this release; (d) Sharp has seven (7) days following execution of this release to revoke this release; and (e) this release of claims under the ADEA shall become effective and enforceable on the eighth day after Sharp signs and delivers this Agreement to the Company’s Chief Human Resources Officer. Nothing in this release

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prevents or precludes Sharp from challenging, or seeking a determination in good faith of, the validity of this waiver under the ADEA or the Older Workers’ Benefit Protection Act (nor does it impose any condition precedent, penalties or cost for doing so, unless specifically authorized by federal law), or from participating in any investigation or proceeding conducted by the Equal Employment Opportunity Commission.

James T. Sharp

Date signed:                                    

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EXHIBIT B

RSU VESTING SCHEDULE

Status of Unvested RSUs	Date of Grant		# of Remaining Units		Vesting Date
James Sharp						05/05/2016	5/22/2016	05/28/2016	8/31/2016	05/05/2017	05/22/2017	5/28/2017	8/31/2017	05/22/2018
Time Based Units		05/28/2013		2,006.000				2,006.000
		05/05/2014		3,136.000		1,568.000				1,568.000
		05/22/2015		6,500.000			2,167.000				2,167.000			2,166.000
Total Time Based Units				11,642.000
Performance Based Units		05/05/2014		4,705.000					4,705.000
		05/22/2015		6,500.000									6,500.000
Total Performance Based				11,205.000
Total RSUs				22,847.000

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EX-31.1

THE GREENBRIER COMPANIES, INC.

Exhibit 31.1

CERTIFICATIONS

I, William A. Furman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of The Greenbrier Companies, Inc. for the quarterly period ended May 31, 2016;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 6, 2016
	/s/ William A. Furman
	William A. Furman President and Chief Executive Officer

EX-31.2

THE GREENBRIER COMPANIES, INC.

Exhibit 31.2

CERTIFICATIONS (cont’d)

I, Lorie L. Tekorius, certify that:

1. I have reviewed this quarterly report on Form 10-Q of The Greenbrier Companies, Inc. for the quarterly period ended May 31, 2016;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 6, 2016
	/s/ Lorie L. Tekorius
	Lorie L. Tekorius Senior Vice President, Chief Financial Officer and Treasurer

EX-32.1

THE GREENBRIER COMPANIES, INC.

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of The Greenbrier Companies, Inc. (the “Company”) on Form 10-Q for the quarterly period ended May 31, 2016, as filed with the Securities and Exchange Commission on the date therein specified (the “Report”), I, William A. Furman, President and Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 6, 2016
	/s/ William A. Furman
	William A. Furman
	President and Chief Executive Officer

EX-32.2

THE GREENBRIER COMPANIES, INC.

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of The Greenbrier Companies, Inc. (the “Company”) on Form 10-Q for the quarterly period ended May 31, 2016, as filed with the Securities and Exchange Commission on the date therein specified (the “Report”), I, Lorie L. Tekorius, Senior Vice President, Chief Financial Officer and Treasurer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 6, 2016
	/s/ Lorie L. Tekorius
	Lorie L. Tekorius Senior Vice President, Chief Financial Officer and Treasurer

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Document and Entity Information - shares	9 Months Ended
	May 31, 2016	Jun. 30, 2016
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	May 31, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	Q3
Trading Symbol	GBX
Entity Registrant Name	GREENBRIER COMPANIES INC
Entity Central Index Key	0000923120
Current Fiscal Year End Date	--08-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		28,204,389

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Consolidated Balance Sheets - USD ($) $ in Thousands	May 31, 2016	Aug. 31, 2015
Assets
Cash and cash equivalents	$ 214,440	$ 172,930
Restricted cash	8,669	8,869
Accounts receivable, net	213,510	196,029
Inventories	458,068	445,535
Leased railcars for syndication	136,812	212,534
Equipment on operating leases, net	232,791	255,391
Property, plant and equipment, net	318,010	303,135
Investment in unconsolidated affiliates	89,297	87,270
Intangibles and other assets, net	71,022	65,554
Goodwill	43,265	43,265
Total assets	1,785,884	1,790,512
Liabilities and Equity
Revolving notes		50,888
Accounts payable and accrued liabilities	370,652	455,213
Deferred income taxes	50,390	60,657
Deferred revenue	68,158	33,836
Notes payable	306,808	326,429
Commitments and contingencies (Note 13)
Greenbrier
Preferred stock - without par value; 25,000 shares authorized; none outstanding
Common stock - without par value; 50,000 shares authorized; 28,202 and 28,907 shares outstanding at May 31, 2016 and August 31, 2015	0	0
Additional paid-in capital	278,880	295,444
Retained earnings	590,725	458,599
Accumulated other comprehensive loss	(29,519)	(21,205)
Total equity - Greenbrier	840,086	732,838
Noncontrolling interest	149,790	130,651
Total equity	989,876	863,489
Liabilities and Equity	$ 1,785,884	$ 1,790,512

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Consolidated Balance Sheets (Parenthetical) - $ / shares	May 31, 2016	Aug. 31, 2015
Preferred stock, without par value
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, outstanding
Common stock, without par value
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares outstanding	28,202,000	28,907,000

XML

Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Revenue
Revenue		$ 612,866	$ 714,606	$ 2,084,334	$ 1,839,813
Cost of revenue
Cost of revenue		485,768	565,320	1,652,580	1,477,149
Margin		127,098	149,286	431,754	362,664
Selling and administrative expense		43,280	45,595	118,073	112,223
Net gain on disposition of equipment		(311)	(720)	(11,326)	(924)
Earnings from operations		84,129	104,411	325,007	251,365
Other costs
Interest and foreign exchange		3,712	4,285	10,565	9,355
Earnings before income taxes and earnings from unconsolidated affiliates		80,417	100,126	314,442	242,010
Income tax (expense) benefit		(22,449)	(30,783)	(92,902)	(76,209)
Earnings before earnings from unconsolidated affiliates		57,968	69,343	221,540	165,801
Earnings from unconsolidated affiliates		1,564	982	2,921	1,552
Net earnings		59,532	70,325	224,461	167,353
Net earnings attributable to noncontrolling interest		(24,180)	(27,514)	(74,808)	(41,405)
Net earnings attributable to Greenbrier		$ 35,352	$ 42,811	$ 149,653	$ 125,948
Basic earnings per common share		$ 1.22	$ 1.54	$ 5.13	$ 4.58
Diluted earnings per common share	[1]	$ 1.12	$ 1.33	$ 4.67	$ 3.91
Weighted average common shares:
Basic	[2]	29,059	27,842	29,182	27,514
Diluted		32,342	33,000	32,475	33,262
Dividends declared per common share		$ 0.20	$ 0.15	$ 0.60	$ 0.45
Manufacturing
Revenue
Revenue		$ 458,494	$ 593,376	$ 1,611,686	$ 1,478,566
Cost of revenue
Cost of revenue		352,775	465,658	1,247,635	1,184,922
Earnings from operations		92,713	115,675	325,215	258,602
Wheels & Parts
Revenue
Revenue		78,417	97,407	247,604	286,671
Cost of revenue
Cost of revenue		69,818	89,645	224,208	259,285
Earnings from operations		5,811	5,078	15,720	20,986
Leasing & Services
Revenue
Revenue		75,955	23,823	225,044	74,576
Cost of revenue
Cost of revenue		63,175	10,017	180,737	32,942
Earnings from operations		$ 8,298	$ 10,824	$ 42,668	$ 31,677

[1] Diluted earnings per share was calculated as follows: Earnings before interest and debt issuance costs (net of tax) on convertible notes Weighted average diluted common shares outstanding

[2] Restricted stock grants and restricted stock units, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position.

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Net earnings		$ 59,532	$ 70,325	$ 224,461	$ 167,353
Other comprehensive income
Translation adjustment		1,477	(1,299)	(3,655)	(10,990)
Reclassification of derivative financial instruments recognized in net earnings	[1]	659	(254)	1,710	417
Unrealized gain (loss) on derivative financial instruments	[2]	1,113	107	(6,417)	(7)
Other (net of tax effect)		7	93	1	99
Other comprehensive income (loss)		3,256	(1,353)	(8,361)	(10,481)
Comprehensive income		62,788	68,972	216,100	156,872
Comprehensive income attributable to noncontrolling interest		(24,195)	(27,497)	(74,761)	(41,253)
Comprehensive income attributable to Greenbrier		$ 38,593	$ 41,475	$ 141,339	$ 115,619

[1] Net of tax effect of $0.3 million and $0.04 million for the three months ended May 31, 2016 and 2015 and $0.7 million and $0.4 million for the nine months ended May 31, 2016 and 2015.

[2] Net of tax effect of $0.3 million and $0.1 million for the three months ended May 31, 2016 and 2015 and $2.2 million and $0.6 million for the nine months ended May 31, 2016 and 2015.

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Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Reclassification of derivative financial instruments recognized in net earnings, tax	$ 300	$ 40	$ 700	$ 400
Unrealized gain (loss) on derivative financial instruments, tax	$ 300	$ 100	$ 2,200	$ 600

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Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock Shares	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Total Attributable to Greenbrier	Attributable to Noncontrolling Interest
Beginning balance (in shares) at Aug. 31, 2014		27,364
Beginning balance at Aug. 31, 2014	$ 573,721		$ 235,763	$ 282,559	$ (6,932)	$ 511,390	$ 62,331
Net earnings	167,353			125,948		125,948	41,405
Other comprehensive loss, net	(10,481)				(10,329)	(10,329)	(152)
Noncontrolling interest adjustments	20,371						20,371
Purchase of noncontrolling interest	(80)						(80)
Joint venture partner distribution declared	(13,267)						(13,267)
Restricted stock awards (net of cancellations)	22,600		22,600			22,600
Restricted stock awards (net of cancellations)(Shares)		19
Unamortized restricted stock	(24,394)		(24,394)			(24,394)
Restricted stock amortization	13,176		13,176			13,176
Excess tax benefit from restricted stock awards	2,964		2,964			2,964
Conversion of convertible notes, net of debt issuance costs (in shares)		2,471
Conversion of convertible notes, net of debt issuance costs	91,749		91,749			91,749
Cash dividends	(12,257)			(12,257)		(12,257)
Repurchase of stock	(48,451)		(48,451)			(48,451)
Repurchase of stock, shares		(891)
Ending Balance (in shares) at May. 31, 2015		28,925
Ending Balance at May. 31, 2015	$ 783,004		293,407	396,250	(17,261)	672,396	110,608
Beginning balance (in shares) at Aug. 31, 2015	28,907	28,907
Beginning balance at Aug. 31, 2015	$ 863,489		295,444	458,599	(21,205)	732,838	130,651
Net earnings	224,461			149,653		149,653	74,808
Other comprehensive loss, net	(8,361)				(8,314)	(8,314)	(47)
Noncontrolling interest adjustments	837						837
Purchase of noncontrolling interest	(4)						(4)
Joint venture partner distribution declared	(61,855)						(61,855)
Investment by joint venture partner	5,400						5,400
Restricted stock awards (net of cancellations)	6,186		6,186			6,186
Restricted stock awards (net of cancellations)(Shares)		350
Unamortized restricted stock	(11,646)		(11,646)			(11,646)
Restricted stock amortization	18,483		18,483			18,483
Excess tax benefit from restricted stock awards	2,786		2,786			2,786
Cash dividends	(17,527)			(17,527)		(17,527)
Repurchase of stock	$ (32,373)		(32,373)			(32,373)
Repurchase of stock, shares		(1,055)
Ending Balance (in shares) at May. 31, 2016	28,202	28,202
Ending Balance at May. 31, 2016	$ 989,876		$ 278,880	$ 590,725	$ (29,519)	$ 840,086	$ 149,790

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	May 31, 2016	May 31, 2015
Cash flows from operating activities
Net earnings	$ 224,461	$ 167,353
Adjustments to reconcile net earnings to net cash provided by operating activities:
Deferred income taxes	(10,143)	(5,245)
Depreciation and amortization	41,681	33,258
Net gain on disposition of equipment	(11,326)	(924)
Stock based compensation expense	19,055	13,176
Noncontrolling interest adjustments	837	20,371
Other	564	1,008
(Increase) decrease in assets:
Accounts receivable, net	(14,333)	(8,769)
Inventories	(15,346)	(124,906)
Leased railcars for syndication	28,823	(90,914)
Other	(5,191)	(1,666)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities	(88,707)	23,135
Deferred revenue	24,303	3,680
Net cash provided by operating activities	194,678	29,557
Cash flows from investing activities
Proceeds from sales of assets	88,707	4,628
Capital expenditures	(51,707)	(75,892)
Decrease in restricted cash	200	228
Investment in and advances to unconsolidated affiliates	(9,088)	(29,923)
Cash distribution from unconsolidated affiliates	5,338	715
Net cash provided by (used in) investing activities	33,450	(100,244)
Cash flows from financing activities
Net change in revolving notes with maturities of 90 days or less	(49,000)	73,000
Proceeds from revolving notes with maturities longer than 90 days		42,563
Repayments of revolving notes with maturities longer than 90 days	(1,888)	(36,137)
Repayments of notes payable	(19,461)	(5,504)
Debt issuance costs	(4,160)
Repurchase of stock	(33,498)	(48,451)
Dividends	(17,362)	(12,069)
Decrease in restricted cash		11,000
Cash distribution to joint venture partner	(62,710)	(12,489)
Investment by joint venture partner	5,400
Excess tax benefit from restricted stock awards	2,786	2,964
Other	(7)	(248)
Net cash provided by (used in) financing activities	(179,900)	14,629
Effect of exchange rate changes	(6,718)	(6,075)
Increase (decrease) in cash and cash equivalents	41,510	(62,133)
Cash and cash equivalents
Beginning of period	172,930	184,916
End of period	214,440	122,783
Cash paid during the period for
Interest	10,852	13,509
Income taxes, net	77,867	87,829
Non-cash activity
Transfer from Leased railcars for syndication to Equipment on operating leases, net	45,535	3,313
Capital expenditures accrued in Accounts payable and accrued liabilities	3,529	2,304
Change in Accounts payable and accrued liabilities associated with repurchase of stock	1,125
Change in Accounts payable and accrued liabilities associated with cash distributions to joint venture partner	855
Change in Accounts payable and accrued liabilities associated with dividends declared	$ (165)	188
Conversion of convertible notes, net of debt issuance costs		$ 91,749

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Interim Financial Statements

9 Months Ended

May 31, 2016

Interim Financial Statements

Note 1 – Interim Financial Statements

The Condensed Consolidated Financial Statements of The Greenbrier Companies, Inc. and its subsidiaries (Greenbrier or the Company) as of May 31, 2016, for the three and nine months ended May 31, 2016 and 2015 have been prepared without audit and reflect all adjustments (consisting of normal recurring accruals) that, in the opinion of management, are necessary for a fair presentation of the financial position, operating results and cash flows for the periods indicated. The results of operations for the three and nine months ended May 31, 2016 are not necessarily indicative of the results to be expected for the entire year ending August 31, 2016.

Certain notes and other information have been condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with the Consolidated Financial Statements contained in the Company’s 2015 Annual Report on Form 10-K.

Management Estimates – The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires judgment on the part of management to arrive at estimates and assumptions on matters that are inherently uncertain. These estimates may affect the amount of assets, liabilities, revenue and expenses reported in the financial statements and accompanying notes and disclosure of contingent assets and liabilities within the financial statements. Estimates and assumptions are periodically evaluated and may be adjusted in future periods. Actual results could differ from those estimates.

Prospective Accounting Changes – In May 2014, the Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) jointly issued a converged standard on the recognition of revenue from contracts with customers. The issued guidance converges the criteria for reporting revenue, and requires disclosures sufficient to describe the nature, amount, timing, and uncertainty of revenue and cash flows arising from these contracts. Companies can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. The FASB issued a one year deferral and the new standard is effective for fiscal years and interim periods within those years beginning after December 15, 2017. The Company plans to adopt this guidance beginning September 1, 2018. The Company is evaluating the impact of this standard as well as its method of adoption on its consolidated financial statements and disclosures.

In April 2015, the FASB issued Accounting Standards Update 2015-03, Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). The FASB issued this update to simplify the presentation of debt issuance costs related to a recognized debt liability to present the debt issuance costs as a direct deduction from the carrying value of the debt liability rather than showing the debt issuance costs as an asset. The guidance is limited to the presentation of debt issuance costs and does not impact its recognition and measurement. The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015, with early adoption permitted, and is required to be applied on a retrospective basis. The Company plans to adopt this guidance beginning September 1, 2016. As the adoption of this new guidance will only amend presentation and disclosure requirements, the adoption will not affect the Company’s financial position, results of operations or cash flows.

In August 2015, the FASB issued Accounting Standards Update 2015-15, Interest-Imputation of Interest: Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line of Credit Arrangements (ASU 2015-15). This update was released because the guidance within ASU 2015-03 for debt issuance costs does not address presentation or subsequent measurement of debt issuance costs related to line of credit arrangements. The SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line of credit arrangement, regardless of whether there are any outstanding borrowings on the line of credit arrangement. The new guidance is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2015. The Company plans to adopt this guidance beginning September 1, 2016. Upon adoption, the Company plans to continue to present debt issuance costs related to line of credit arrangements as an asset. The adoption of this new guidance will not affect the Company’s financial position, results of operations or cash flows.

In February 2016, the FASB issued Accounting Standards Update 2016-02, Leases (ASU 2016-02). The new guidance supersedes existing guidance on accounting for leases in Topic 840 and is intended to increase the transparency and comparability of accounting for lease transactions. ASU 2016-02 requires most leases to be recognized on the balance sheet. Lessees will need to recognize a right-of-use asset and a lease liability for virtually all leases. The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Lessor accounting remains similar to the current model, but updated to align with certain changes to the lessee model and the new revenue recognition standard. The ASU will require both quantitative and qualitative disclosures regarding key information about leasing arrangements. The standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented. The Company plans to adopt this guidance beginning September 1, 2019. The Company is evaluating the impact of this standard on its consolidated financial statements and disclosures.

In March 2016, the FASB issued Accounting Standards Update 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting (ASU 2016-09). The new guidance will change how companies account for certain aspects of share-based payments to employees. Excess tax benefits related to vested awards, previously recognized in equity, will be required to be recognized in the income statement when the awards vest. The new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2016, with early adoption permitted. The Company plans to adopt this guidance beginning September 1, 2017. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements and disclosures.

Share Repurchase Program – Since October 2013, the Board of Directors has authorized the Company to repurchase in aggregate up to $225 million of the Company’s common stock. The program may be modified, suspended or discontinued at any time without prior notice. Under the share repurchase program, shares of common stock may be purchased on the open market or through privately negotiated transactions from time-to-time. The timing and amount of purchases will be based upon market conditions, securities law limitations and other factors. The share repurchase program does not obligate the Company to acquire any specific number of shares in any period.

During the nine months ended May 31, 2016, the Company purchased a total of 1,054,687 shares for approximately $32.4 million. The Company did not repurchase any shares during the three months ended May 31, 2016. As of May 31, 2016 the Company had cumulatively repurchased 3,206,226 shares for approximately $137.0 million and had $88.0 million available under the share repurchase program with an expiration date of January 1, 2018.

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Inventories

9 Months Ended

May 31, 2016

Inventories

Note 2 – Inventories

Inventories are valued at the lower of cost (first-in, first-out) or market. Work-in-process includes material, labor and overhead. The following table summarizes the Company’s inventory balance:

(In thousands)	May 31, 2016			August 31, 2015
Manufacturing supplies and raw materials	$	258,608		$	311,880
Work-in-process		63,602			75,032
Finished goods		139,199			61,302
Excess and obsolete adjustment		(3,341	)		(2,679	)
	$	458,068		$	445,535

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Intangibles and Other Assets, net

9 Months Ended

May 31, 2016

Intangibles and Other Assets, net

Note 3 – Intangibles and Other Assets, net

Intangible assets that are determined to have finite lives are amortized over their useful lives. Intangible assets with indefinite useful lives are not amortized and are periodically evaluated for impairment.

The following table summarizes the Company’s identifiable intangible and other assets balance:

(In thousands)	May 31, 2016			August 31, 2015
Intangible assets subject to amortization:
Customer relationships	$	65,023		$	65,023
Accumulated amortization		(36,395	)		(33,828	)
Other intangibles		6,288			3,422
Accumulated amortization		(5,757	)		(3,121	)
		29,159			31,496
Intangible assets not subject to amortization		912			912
Prepaid and other assets		15,671			13,111
Nonqualified savings plan investments		15,093			11,815
Debt issuance costs, net		6,079			3,823
Assets held for sale		4,108			4,397
Total Intangible and other assets, net	$	71,022		$	65,554

Amortization expense for the three and nine months ended May 31, 2016 was $1.5 million and $5.3 million and for the three and nine months ended May 31, 2015 was $0.9 million and $2.7 million. Amortization expense for the years ending August 31, 2016, 2017, 2018, 2019 and 2020 is expected to be $6.3 million, $3.6 million, $3.5 million, $3.4 million and $3.4 million.

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Revolving Notes

9 Months Ended

May 31, 2016

Revolving Notes

Note 4 – Revolving Notes

Senior secured credit facilities, consisting of three components, aggregated to $615.5 million as of May 31, 2016.

As of May 31, 2016, a $550.0 million revolving line of credit, maturing October 2020, secured by substantially all the Company’s assets in the U.S. not otherwise pledged as security for term loans, was available to provide working capital and interim financing of equipment, principally for the U.S. and Mexican operations. Advances under this facility bear interest at LIBOR plus 1.75% or Prime plus 0.75% depending on the type of borrowing. Available borrowings under the credit facility are generally based on defined levels of inventory, receivables, property, plant and equipment and leased equipment, as well as total debt to consolidated capitalization and fixed charges coverage ratios.

As of May 31, 2016, lines of credit totaling $15.5 million secured by certain of the Company’s European assets, with various variable rates that range from Warsaw Interbank Offered Rate (WIBOR) plus 1.2% to WIBOR plus 1.3%, were available for working capital needs of the European manufacturing operation. European credit facilities are continually being renewed. Currently these European credit facilities have maturities that range from February 2017 through June 2017.

The Company’s Mexican railcar manufacturing joint venture has two lines of credit totaling $50.0 million. The first line of credit provides up to $30.0 million and is fully guaranteed by the Company and its joint venture partner. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw against this facility through January 2019. The second line of credit provides up to $20.0 million, of which the Company and its joint venture partner have each guaranteed 50%. Advances under this facility bear interest at LIBOR plus 2.0%. The Mexican railcar manufacturing joint venture will be able to draw amounts available under this facility through August 2017.

As of May 31, 2016, outstanding commitments under the senior secured credit facilities consisted of $81.3 million in letters of credit under the North American credit facility.

As of August 31, 2015, outstanding commitments under the senior secured credit facilities consisted of $47.2 million in letters of credit and $49.0 million in revolving notes under the North American credit facility and $1.9 million outstanding in revolving notes under the Mexican railcar manufacturing joint venture credit facilities.

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Accounts Payable and Accrued Liabilities

9 Months Ended

May 31, 2016

Accounts Payable and Accrued Liabilities

Note 5 – Accounts Payable and Accrued Liabilities

(In thousands)	May 31, 2016		August 31, 2015
Trade payables	$	187,240	$	263,665
Other accrued liabilities		73,919		64,584
Accrued payroll and related liabilities		61,629		70,836
Accrued maintenance		18,488		18,642
Accrued warranty		12,132		11,512
Income taxes payable		11,604		22,465
Other		5,640		3,509
	$	370,652	$	455,213

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Warranty Accruals

9 Months Ended

May 31, 2016

Warranty Accruals

Note 6 – Warranty Accruals

Warranty costs are estimated and charged to operations to cover a defined warranty period. The estimated warranty cost is based on the history of warranty claims for each particular product type. For new product types without a warranty history, preliminary estimates are based on historical information for similar product types. The warranty accruals, included in Accounts payable and accrued liabilities on the Consolidated Balance Sheets, are reviewed periodically and updated based on warranty trends and expirations of warranty periods.

Warranty accrual activity:

(In thousands)	Three Months Ended May 31,						Nine Months Ended May 31,
	2016			2015			2016			2015
Balance at beginning of period	$	12,147		$	9,188		$	11,512		$	9,340
Charged to cost of revenue, net		1,202			2,036			4,086			3,982
Payments		(1,205	)		(994	)		(3,386	)		(2,797	)
Currency translation effect		(12	)		(32	)		(80	)		(327	)
Balance at end of period	$	12,132		$	10,198		$	12,132		$	10,198

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Notes Payable

9 Months Ended

May 31, 2016

Notes Payable

Note 7 – Notes Payable

The Company’s Notes payable balance was $306.8 million as of May 31, 2016 which includes Convertible senior notes, due 2026 (the 2026 Notes). On specified dates or in the event of certain fundamental changes, holders can require the Company to repurchase all or a portion of their 2026 Notes at a price equal to 100% of the principal amount of the 2026 Notes plus accrued and unpaid interest (the Put Option). During the three months ended May 31, 2016, the Company retired $14.0 million of its then $14.9 million outstanding 2026 Notes pursuant to a scheduled Put Option leaving $0.9 million outstanding in 2026 Notes as of May 31, 2016.

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Accumulated Other Comprehensive Loss

9 Months Ended

May 31, 2016

Accumulated Other Comprehensive Loss

Note 8 – Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss, net of tax effect as appropriate, consisted of the following:

(In thousands)	Unrealized Loss on Derivative Financial Instruments			Foreign Currency Translation Adjustment			Other			Accumulated Other Comprehensive Loss
Balance, August 31, 2015	$	(2,194	)	$	(18,666	)	$	(345	)	$	(21,205	)
Other comprehensive loss before reclassifications		(6,417	)		(3,608	)		1			(10,024	)
Amounts reclassified from accumulated other comprehensive loss		1,710			—			—			1,710
Balance, May 31, 2016	$	(6,901	)	$	(22,274	)	$	(344	)	$	(29,519	)

The amounts reclassified out of Accumulated other comprehensive loss into the Consolidated Statements of Income, with presentation location, were as follows:

	Three Months Ended May 31,						Nine Months Ended May 31,						Financial Statement Location
(In thousands)	2016			2015			2016			2015
(Gain) loss on derivative financial instruments:
Foreign exchange contracts	$	561		$	(652	)	$	1,203		$	(518	)	Revenue
Interest rate swap contracts		370			442			1,247			1,349		Interest and foreign exchange
		931			(210	)		2,450			831		Total before tax
		(272	)		(44	)		(740	)		(414	)	Tax expense
	$	659		$	(254	)	$	1,710		$	417		Net of tax

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Earnings Per Share

9 Months Ended

May 31, 2016

Earnings Per Share

Note 9 – Earnings Per Share

The shares used in the computation of the Company’s basic and diluted earnings per common share are reconciled as follows:

(In thousands)	Three Months Ended May 31,				Nine Months Ended May 31,
	2016		2015		2016		2015
Weighted average basic common shares outstanding (1)		29,059		27,842		29,182		27,514
Dilutive effect of 2018 Convertible notes (2)		3,224		5,155		3,202		5,745
Dilutive effect of 2026 Convertible notes (3)		—		3		—		3
Dilutive effect of performance based restricted stock units (4)		59		—		91		—
Weighted average diluted common shares outstanding		32,342		33,000		32,475		33,262

(1) Restricted stock grants and restricted stock units, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position.

(2) The dilutive effect of the 2018 Convertible notes was included for the three and nine months ended May 31, 2016 and 2015 as they were considered dilutive under the “if converted” method as further discussed below.

(3) The dilutive effect of the 2026 Convertible notes was excluded for the three and nine months ended May 31, 2016 as the average stock price was less than the conversion price of $47.15 and therefore was considered anti-dilutive. The effect of the 2026 Convertible notes was included for the three and nine months ended May 31, 2015 as the average stock price was greater than the applicable conversion price, as further described below.

(4) Restricted stock units that are subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position.

Dilutive EPS is calculated using the more dilutive of two approaches. The first approach includes the dilutive effect, using the treasury stock method, associated with shares underlying the 2026 Convertible notes and performance based restricted stock units that are subject to performance criteria, for which actual levels of performance above target have been achieved. The second approach supplements the first by including the “if converted” effect of the 2018 Convertible notes issued in March 2011. Under the “if converted” method, debt issuance and interest costs, both net of tax, associated with the convertible notes are added back to net earnings and the share count is increased by the shares underlying the convertible notes. The 2026 Convertible notes are included in the calculation of both approaches using the treasury stock method when the average stock price is greater than the applicable conversion price.

	Three Months Ended May 31,				Nine Months Ended May 31,
	2016		2015		2016		2015
Net earnings attributable to Greenbrier	$	35,352	$	42,811	$	149,653	$	125,948
Add back:
Interest and debt issuance costs on the 2018 Convertible notes, net of tax		733		1,234		1,962		4,066
Earnings before interest and debt issuance costs on convertible notes	$	36,085	$	44,045	$	151,615	$	130,014
Weighted average diluted common shares outstanding		32,342		33,000		32,475		33,262
Diluted earnings per share (1)	$	1.12	$	1.33	$	4.67	$	3.91

(1) Diluted earnings per share was calculated as follows:

Earnings before interest and debt issuance costs (net of tax) on convertible notes

Weighted average diluted common shares outstanding

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Stock Based Compensation

9 Months Ended

May 31, 2016

Stock Based Compensation

Note 10 – Stock Based Compensation

The value of stock based compensation awards is amortized as compensation expense from the date of grant through the earlier of the vesting period or the recipient’s eligible retirement date. Awards are expensed upon grant when the recipient’s eligible retirement date precedes the grant date.

Stock based compensation expense was $8.3 million and $19.1 million for the three and nine months ended May 31, 2016, respectively and $6.0 million and $13.2 million for the three and nine months ended May 31, 2015, respectively. Compensation expense is recorded in Selling and administrative expense and Cost of revenue on the Consolidated Statements of Income.

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Derivative Instruments

9 Months Ended

May 31, 2016

Derivative Instruments

Note 11 – Derivative Instruments

Foreign operations give rise to market risks from changes in foreign currency exchange rates. Foreign currency forward exchange contracts with established financial institutions are utilized to hedge a portion of that risk. Interest rate swap agreements are used to reduce the impact of changes in interest rates on certain debt. The Company’s foreign currency forward exchange contracts and interest rate swap agreements are designated as cash flow hedges, and therefore the effective portion of unrealized gains and losses is recorded in accumulated other comprehensive income or loss.

At May 31, 2016 exchange rates, forward exchange contracts for the purchase of Polish Zlotys and the sale of Euros and U.S. Dollars; the purchase of Mexican Pesos and the sale of U.S. Dollars; and for the purchase of U.S. Dollars and the sale of Saudi Riyals aggregated to $429.7 million. The fair value of the contracts is included on the Consolidated Balance Sheets as Accounts payable and accrued liabilities when there is a loss, or as Accounts receivable, net when there is a gain. As the contracts mature at various dates through September 2018, any such gain or loss remaining will be recognized in manufacturing revenue or cost of revenue along with the related transactions. In the event that the underlying transaction does not occur or does not occur in the period designated at the inception of the hedge, the amount classified in accumulated other comprehensive loss would be reclassified to the results of operations in Interest and foreign exchange at the time of occurrence.

At May 31, 2016, an interest rate swap agreement maturing in March 2020 had a notional amount of $93.0 million. The fair value of the contract is included in Accounts payable and accrued liabilities on the Consolidated Balance Sheets. As interest expense on the underlying debt is recognized, amounts corresponding to the interest rate swap are reclassified from Accumulated other comprehensive loss and charged or credited to interest expense. At May 31, 2016 interest rates, approximately $1.4 million would be reclassified to interest expense in the next 12 months.

Fair Values of Derivative Instruments

	Asset Derivatives					Liability Derivatives
		May 31, 2016		August 31, 2015			May 31, 2016		August 31, 2015
(In thousands)	Balance sheet location	Fair Value		Fair Value		Balance sheet location	Fair Value		Fair Value
Derivatives designated as hedging instruments
Foreign forward exchange contracts	Accounts receivable, net	$	3,640	$	1,820	Accounts payable and accrued liabilities	$	5,402	$	737
Interest rate swap contracts	Intangibles and other assets, net		—		—	Accounts payable and accrued liabilities		3,437		2,393
		$	3,640	$	1,820		$	8,839	$	3,130
Derivatives not designated as hedging instruments
Foreign forward exchange contracts	Accounts receivable, net	$	—	$	93	Accounts payable and accrued liabilities	$	190	$	76

The Effect of Derivative Instruments on the Statements of Income

Derivatives in cash flow hedging relationships	Location of gain (loss) recognized in income on derivatives	Gain (loss) recognized in income on derivatives nine months ended May 31,
		2016			2015
Foreign forward exchange contract	Interest and foreign exchange	$	(245	)	$	(22	)
Interest rate swap contracts	Interest and foreign exchange		88			69
		$	(157	)	$	47

Derivatives in cash flow hedging relationships	Gain (loss) recognized in OCI on derivatives (effective portion) nine months ended May 31,						Location of gain (loss) reclassified from accumulated OCI into income	Gain (loss) reclassified from accumulated OCI into income (effective portion) nine months ended May 31,						Location of gain on derivative (ineffective portion and amount excluded from effectiveness testing)	Gain recognized on derivative (ineffective portion and amount excluded from effectiveness testing) nine months ended May 31,
	2016			2015				2016			2015				2016		2015
Foreign forward exchange contracts	$	(5,430	)	$	1,867		Revenue	$	(835	)	$	518		Revenue	$	2,572	$	1,024
Foreign forward exchange contracts		(919	)		—		Cost of revenue		(412	)		—		Cost of revenue		88		—
Interest rate swap contracts		(2,274	)		(2,640	)	Interest and foreign exchange		(1,203	)		(1,349	)	Interest and foreign exchange		—		—
	$	(8,623	)	$	(773	)		$	(2,450	)	$	(831	)		$	2,660	$	1,024

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Segment Information

9 Months Ended

May 31, 2016

Segment Information

Note 12 – Segment Information

Greenbrier operates in four reportable segments: Manufacturing; Wheels & Parts; Leasing & Services; and GBW Joint Venture. The results of GBW Joint Venture are included as part of Earnings from unconsolidated affiliates as the Company accounts for its interest in GBW Railcar Services LLC (GBW) under the equity method of accounting.

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 2015 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 model. 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. 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 months ended May 31, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	458,494	$	5,595		$	464,089		$	92,713		$	923		$	93,636
Wheels & Parts		78,417		10,058			88,475			5,811			711			6,522
Leasing & Services		75,955		601			76,556			8,298			601			8,899
Eliminations		—		(16,254	)		(16,254	)		—			(2,235	)		(2,235	)
Corporate		—		—			—			(22,693	)		—			(22,693	)
	$	612,866	$	—		$	612,866		$	84,129		$	—		$	84,129

For the nine months ended May 31, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,611,686	$	5,595		$	1,617,281		$	325,215		$	941		$	326,156
Wheels & Parts		247,604		24,074			271,678			15,720			2,155			17,875
Leasing & Services		225,044		10,444			235,488			42,668			10,444			53,112
Eliminations		—		(40,113	)		(40,113	)		—			(13,540	)		(13,540	)
Corporate		—		—			—			(58,596	)		—			(58,596	)
	$	2,084,334	$	—		$	2,084,334		$	325,007		$	—		$	325,007

For the three months ended May 31, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	593,376	$	33		$	593,409		$	115,675		$	—		$	115,675
Wheels & Parts		97,407		7,605			105,012			5,078			607			5,685
Leasing & Services		23,823		11,722			35,545			10,824			11,722			22,546
Eliminations		—		(19,360	)		(19,360	)		—			(12,329	)		(12,329	)
Corporate		—		—			—			(27,166	)		—			(27,166	)
	$	714,606	$	—		$	714,606		$	104,411		$	—		$	104,411

For the nine months ended May 31, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,478,566	$	7,534		$	1,486,100		$	258,602		$	795		$	259,397
Wheels & Parts		286,671		20,450			307,121			20,986			2,044			23,030
Leasing & Services		74,576		43,533			118,109			31,677			43,533			75,210
Eliminations		—		(71,517	)		(71,517	)		—			(46,372	)		(46,372	)
Corporate		—		—			—			(59,900	)		—			(59,900	)
	$	1,839,813	$	—		$	1,839,813		$	251,365		$	—		$	251,365

	Total assets
	May 31,		August 31,
(In thousands)	2016		2015
Manufacturing	$	641,090	$	675,409
Wheels & Parts		301,474		291,798
Leasing & Services		523,989		549,073
Unallocated		319,331		274,232
	$	1,785,884	$	1,790,512

Reconciliation of Earnings from operations to Earnings before income tax and earnings from unconsolidated affiliates:

	Three Months Ended May 31,				Nine Months Ended May 31,
(In thousands)	2016		2015		2016		2015
Earnings from operations	$	84,129	$	104,411	$	325,007	$	251,365
Interest and foreign exchange		3,712		4,285		10,565		9,355
Earnings before income tax and earnings from unconsolidated affiliates	$	80,417	$	100,126	$	314,442	$	242,010

The results of operations for the GBW Joint Venture are accounted for under the equity method of accounting. The GBW Joint Venture is the Company’s fourth reportable segment and information as of May 31, 2016 and August 31, 2015 and for the three and nine months ended May 31, 2016 and 2015 are included in the tables below.

	Three Months Ended May 31,				Nine Months Ended May 31,
(In thousands)	2016		2015		2016		2015
Revenue	$	95,699	$	88,831	$	289,381	$	254,688
Earnings (loss) from operations	$	3,030	$	227	$	9,065	$	(1,507	)
	Total Assets
	May 31, 2016		August 31, 2015
GBW (1)	$	255,400	$	239,871

⁽¹⁾  Includes goodwill and intangible assets of $94.4 million and $96.9 million as of May 31, 2016 and August 31, 2015.

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Commitments and Contingencies

9 Months Ended

May 31, 2016

Commitments and Contingencies

Note 13 – Commitments and Contingencies

The Company’s Portland, Oregon manufacturing facility is located adjacent to the Willamette River. The Company has entered into a Voluntary Cleanup Agreement with the Oregon Department of Environmental Quality (DEQ) in which the Company agreed to conduct an investigation of whether, and to what extent, past or present operations at the Portland property may have released hazardous substances into the environment.

In December 2000, the U.S. Environmental Protection Agency (EPA) classified portions of the Willamette River bed known as the Portland Harbor, including the portion fronting the Company’s manufacturing facility, as a federal “National Priority List” or “Superfund” site due to sediment contamination (the Portland Harbor Site). The Company and more than 140 other parties have received a “General Notice” of potential liability from the EPA relating to the Portland Harbor Site. The letter advised the Company that it may be liable for the costs of investigation and remediation (which liability may be joint and several with other potentially responsible parties) as well as for natural resource damages resulting from releases of hazardous substances to the site. At this time, ten private and public entities, including the Company (the Lower Willamette Group or LWG), have signed an Administrative Order on Consent (AOC) to perform a remedial investigation/feasibility study (RI/FS) of the Portland Harbor Site under EPA oversight, and several additional entities have not signed such consent, but are nevertheless contributing money to the effort. The EPA-mandated RI/FS is being produced by the LWG and has cost over $110 million during a 15-year period. The Company has agreed to initially bear a percentage of the total costs incurred by the LWG in connection with the investigation. The Company’s aggregate expenditure has not been material during the 15-year period. Some or all of any such outlay may be recoverable from other responsible parties.

Eighty-three parties, including the State of Oregon and the federal government, have entered into a non-judicial mediation process to try to allocate costs associated with the Portland Harbor site. Approximately 110 additional parties have signed tolling agreements related to such allocations. On April 23, 2009, the Company and the other AOC signatories filed suit against 69 other parties due to a possible limitations period for some such claims; Arkema Inc. et al v. A & C Foundry Products, Inc. et al, U.S. District Court, District of Oregon, Case #3:09-cv-453-PK. All but 12 of these parties elected to sign tolling agreements and be dismissed without prejudice, and the case has now been stayed by the court, pending the EPA’s Record of Decision, currently scheduled by the EPA for December 31, 2016.

On June 8, 2016, the EPA issued its Feasibility Study (FS) and Proposed Plan for the Portland Harbor Site. The EPA is accepting comments from the public on its Proposed Plan through August 8, 2016. The EPA’s FS includes remediation alternatives that would take from 4 to 62 years of active remediation, with an undiscounted cost ranging from $642 million to $10.2 billion and a net present value assuming a 7% discount rate ranging between $451 million and $9.4 billion. The Proposed Plan identifies the alternative currently favored by the EPA, which it assigns an estimated undiscounted cost of between $1.1 and $1.2 billion and a net present value of between $746 and $811 million. The EPA expects its cost estimates to be accurate within a range of +50 to -30 percent. EPA estimates that the remedy in the Proposed Plan would take 7 years of active remediation followed by 30 years of monitoring. The EPA’s FS and its Proposed Plan identify 13 Sediment Decision Units. One of the units, RM9W, includes the nearshore area of the river sediments offshore of our Portland, Oregon manufacturing facility as well as upstream and downstream of the facility. It also includes a portion of our riverbank. Neither the FS nor the Proposed Plan breaks down total remediation costs by unit.

Neither the EPA’s FS nor its Proposed Plan addresses responsibility for the costs of clean-up, allocates such costs among the potentially responsible parties, or defines precise boundaries for the cleanup. Responsibility for funding and implementing the EPA’s selected cleanup option will be determined after the issuance of the Record of Decision, currently scheduled by the EPA for December 31, 2016. Based on the investigation to date, the Company believes that it did not contribute in any material way to contamination in the river sediments or the damage of natural resources in the Portland Harbor Site and that the damage in the area of the Portland Harbor Site adjacent to its property precedes its ownership of the Portland, Oregon manufacturing facility. Because these environmental investigations are still underway, sufficient information is currently not available to determine the Company’s liability, if any, for the cost of any required remediation or restoration of the Portland Harbor Site or to estimate a range of potential loss. Based on the results of the pending investigations and future assessments of natural resource damages, the Company may be required to incur costs associated with additional phases of investigation or remedial action, and may be liable for damages to natural resources. In addition, the Company may be required to perform periodic maintenance dredging in order to continue to launch vessels from its launch ways in Portland, Oregon, on the Willamette River, and the river’s classification as a Superfund site could result in some limitations on future dredging and launch activities. Any of these matters could adversely affect the Company’s business and Consolidated Financial Statements, or the value of its Portland property.

The Company has also signed an Order on Consent with the DEQ to finalize the investigation of potential onsite sources of contamination that may have a release pathway to the Willamette River. Interim precautionary measures are also required in the order and the Company is currently discussing with the DEQ potential remedial actions which may be required. Our aggregate expenditure has not been material, however the Company could incur significant expenses for remediation. Some or all of any such outlay may be recoverable from other responsible parties.

From time to time, Greenbrier is involved as a defendant in litigation in the ordinary course of business, the outcome of which cannot be predicted with certainty. While the ultimate outcome of such legal proceedings cannot be determined at this time, management believes that the resolution of these actions will not have a material adverse effect on the Company’s Consolidated Financial Statements.

In accordance with customary business practices in Europe, the Company has $3.2 million in third party warranty guarantee facilities. To date no amounts have been drawn under these guarantee facilities.

As of May 31, 2016, the Mexican railcar manufacturing joint venture had $0.9 million of third party debt outstanding, for which the Company and its joint venture partner had each guaranteed approximately $0.4 million.

As of May 31, 2016, the Company had outstanding letters of credit aggregating $81.3 million associated with performance guarantees, facility leases and workers compensation insurance.

The Company made $5.3 million in cash contributions and $3.75 million in loans to GBW, an unconsolidated 50/50 joint venture, for the nine months ended May 31, 2016. The Company expects to loan additional amounts of approximately $1.25 million during 2016. The Company is likely to make additional capital contributions or loans to GBW in the future. As of May 31, 2016, the Company had a $35.2 million note receivable balance from GBW which is included on the Consolidated Balance Sheet in Accounts receivable, net.

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Fair Value Measures

9 Months Ended

May 31, 2016

Fair Value Measures

Note 14 – Fair Value Measures

Certain assets and liabilities are reported at fair value on either a recurring or nonrecurring basis. Fair value, for this disclosure, is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, under a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

Level 1 -	observable inputs such as unadjusted quoted prices in active markets for identical instruments;
Level 2 -	inputs, other than the quoted market prices in active markets for similar instruments, which are observable, either directly or indirectly; and
Level 3 -	unobservable inputs for which there is little or no market data available, which require the reporting entity to develop its own assumptions.

Assets and liabilities measured at fair value on a recurring basis as of May 31, 2016 were:

(In thousands)	Total		Level 1		Level 2 (1)		Level 3
Assets:
Derivative financial instruments	$	3,640	$	—	$	3,640	$	—
Nonqualified savings plan investments		15,093		15,093		—		—
Cash equivalents		5,076		5,076		—		—
	$	23,809	$	20,169	$	3,640	$	—
Liabilities:
Derivative financial instruments	$	9,029	$	—	$	9,029	$	—

(1) Level 2 assets and liabilities include derivative financial instruments that are valued based on observable inputs. See Note 11 Derivative Instruments for further discussion.

Assets and liabilities measured at fair value on a recurring basis as of August 31, 2015 were:

(In thousands)	Total		Level 1		Level 2		Level 3
Assets:
Derivative financial instruments	$	1,913	$	—	$	1,913	$	—
Nonqualified savings plan investments		11,815		11,815		—		—
Cash equivalents		5,071		5,071		—		—
	$	18,799	$	16,886	$	1,913	$	—
Liabilities:
Derivative financial instruments	$	3,206	$	—	$	3,206	$	—

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Related Party Transactions

9 Months Ended

May 31, 2016

Related Party Transactions

Note 15 – Related Party Transactions

In April 2010, WLR–Greenbrier Rail Inc. (WLR-GBX) was formed and acquired a lease fleet of nearly 4,000 railcars valued at approximately $256.0 million. WLR-GBX is wholly owned by affiliates of WL Ross & Co, LLC (WL Ross) and a member of the Company’s board of directors, Wendy Teramoto, is also an affiliate of WL Ross. In September 2015, the Company purchased the entire remaining WLR-GBX lease fleet of 3,885 railcars for approximately $148.0 million plus a $1.0 million fee. The transaction was approved by the Company’s disinterested, independent directors. The Company intends to sell the railcars and underlying attached leases to third parties in the short-term and therefore has classified these railcars as Leased railcars for syndication on the Company’s Consolidated Balance Sheet. During the nine months ended May 31, 2016, the Company sold to third parties 3,159 of these railcars with the underlying leases attached for $162.0 million. The Company recognized revenue on 2,766 of these railcars for $154.2 million and deferred revenue recognition on 389 of these railcars for $7.8 million due to the Company’s continuing involvement.

The Company and WL Ross have agreed that the Company will receive a preferred return on the proceeds of the sale of the portfolio, after which it will share a portion of the profits with WL Ross up to certain defined levels. The Company is first entitled to recoup its total investment plus a rate of return of 25%. The Company and WL Ross will then share in the profits up to certain defined levels. Once those defined levels have been met, the Company is entitled to receive 100% of the remaining profits. During the nine months ended May 31, 2016, the Company paid a total of $7.2 million to WL Ross pursuant to this profit sharing agreement and as of May 31, 2016 has accrued an additional $11.3 million that it anticipates will be paid to WL Ross in the future.

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Guarantor/Non-Guarantor

9 Months Ended

May 31, 2016

Guarantor/Non-Guarantor

Note 16 – Guarantor/Non-Guarantor

The convertible senior notes due 2026 (the “Notes”) issued on May 22, 2006 are fully and unconditionally and jointly and severally guaranteed by substantially all of Greenbrier’s material 100% owned U.S. subsidiaries: Autostack Company LLC; Greenbrier-Concarril, LLC; Greenbrier Leasing Company LLC; Greenbrier Leasing Limited Partner, LLC; Greenbrier Management Services, LLC; Greenbrier Leasing, L.P.; Greenbrier Railcar LLC; Gunderson LLC; Gunderson Marine LLC; Gunderson Rail Services LLC; Meridian Rail Holding Corp.; Meridian Rail Acquisition Corp.; Meridian Rail Mexico City Corp.; Brandon Railroad LLC; Gunderson Specialty Products, LLC; Greenbrier Railcar Leasing, Inc. and Greenbrier Rail Services Holdings, LLC. No other subsidiaries guarantee the Notes including Greenbrier Union Holdings I LLC; Greenbrier MUL Holdings I LLC; Greenbrier Leasing Limited; Greenbrier Europe B.V.; Greenbrier Europe Holdings B.V.; Greenbrier International Holdings II, LLC; Greenbrier Germany GmbH; WagonySwidnica S.A.; Zaklad Naprawczy Taboru Kolejowego Olawa sp. z o.o.; Zaklad Transportu Kolejowego SIARKOPOL sp. z o.o.; Gunderson-Concarril, S.A. de C.V.; Mexico Meridianrail Services, S.A. de C.V.; Greenbrier Railcar Services – Tierra Blanca S.A. de C.V.; YSD Doors, S.A. de C.V.; Greenbrier do Brasil Participações Ltda; Greenbrier Tank Components, LLC; Gunderson-GIMSA S.A. de C.V.; Greenbrier; S.A. de C.V.; Greenbrier Industries, S.A. de C.V., GBSummit, LLC and Greenbrier-GIMSA, LLC.

The following represents the supplemental consolidating condensed financial information of Greenbrier and its guarantor and non-guarantor subsidiaries, as of May 31, 2016 and August 31, 2015 and for the three and nine months ended May 31, 2016 and 2015. The information is presented on the basis of Greenbrier accounting for its ownership of its wholly owned subsidiaries using the equity method of accounting. The equity method investment for each subsidiary is recorded by the parent in intangibles and other assets. Intercompany transactions of goods and services between the guarantor and non-guarantor subsidiaries are presented as if the sales or transfers were at fair value to third parties and eliminated in consolidation.

The Greenbrier Companies, Inc.

Condensed Consolidating Balance Sheet

May 31, 2016

(In thousands, unaudited)

	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	55,717	$	1,263	$	157,460	$	—		$	214,440
Restricted cash		—		1,765		6,904		—			8,669
Accounts receivable, net		3,736		585,797		49,529		(425,552	)		213,510
Inventories		—		272,481		198,455		(12,868	)		458,068
Leased railcars for syndication		—		139,827		—		(3,015	)		136,812
Equipment on operating leases, net		—		232,900		2,709		(2,818	)		232,791
Property, plant and equipment, net		9,139		104,302		204,569		—			318,010
Investment in unconsolidated affiliates		1,367,146		198,977		21,056		(1,497,882	)		89,297
Intangibles and other assets, net		21,185		44,083		14,036		(8,282	)		71,022
Goodwill		—		43,265		—		—			43,265
	$	1,456,923	$	1,624,660	$	654,718	$	(1,950,417	)	$	1,785,884
Liabilities and Equity
Revolving notes	$	—	$	—	$	—	$	—		$	—
Accounts payable and accrued liabilities		449,757		223,954		170,823		(473,882	)		370,652
Deferred income taxes		14,415		54,090		—		(18,115	)		50,390
Deferred revenue		32,732		30,870		281		4,275			68,158
Notes payable		119,933		186,000		875		—			306,808
Total equity - Greenbrier		840,086		1,129,746		332,880		(1,462,626	)		840,086
Noncontrolling interest		—		—		149,859		(69	)		149,790
Total equity		840,086		1,129,746		482,739		(1,462,695	)		989,876
	$	1,456,923	$	1,624,660	$	654,718	$	(1,950,417	)	$	1,785,884

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the three months ended May 31, 2016

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	(1,055	)	$	235,613		$	419,441		$	(195,505	)	$	458,494
Wheels & Parts		—			82,292			—			(3,875	)		78,417
Leasing & Services		1,294			74,668			—			(7	)		75,955
		239			392,573			419,441			(199,387	)		612,866
Cost of revenue
Manufacturing		—			216,829			334,498			(198,552	)		352,775
Wheels & Parts		—			73,475			—			(3,657	)		69,818
Leasing & Services		—			63,201			—			(26	)		63,175
		—			353,505			334,498			(202,235	)		485,768
Margin		239			39,068			84,943			2,848			127,098
Selling and administrative expense		22,933			10,672			9,494			181			43,280
Net (gain) loss on disposition of equipment		—			(308	)		254			(257	)		(311	)
Earnings (loss) from operations		(22,694	)		28,704			75,195			2,924			84,129
Other costs
Interest and foreign exchange		2,069			1,910			(83	)		(184	)		3,712
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(24,763	)		26,794			75,278			3,108			80,417
Income tax (expense) benefit		1,460			(7,556	)		(15,244	)		(1,109	)		(22,449	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(23,303	)		19,238			60,034			1,999			57,968
Earnings (loss) from unconsolidated affiliates		58,655			15,452			348			(72,891	)		1,564
Net earnings (loss)		35,352			34,690			60,382			(70,892	)		59,532
Net (earnings) loss attributable to noncontrolling interest		—			—			(22,579	)		(1,601	)		(24,180	)
Net earnings (loss) attributable to Greenbrier	$	35,352		$	34,690		$	37,803		$	(72,493	)	$	35,352

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the nine months ended May 31, 2016

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	1,992		$	862,856		$	1,336,226		$	(589,388	)	$	1,611,686
Wheels & Parts		—			252,744			—			(5,140	)		247,604
Leasing & Services		1,354			223,683			1			6			225,044
		3,346			1,339,283			1,336,227			(594,522	)		2,084,334
Cost of revenue
Manufacturing		—			745,419			1,089,603			(587,387	)		1,247,635
Wheels & Parts		—			228,969			—			(4,761	)		224,208
Leasing & Services		—			180,814			—			(77	)		180,737
		—			1,155,202			1,089,603			(592,225	)		1,652,580
Margin		3,346			184,081			246,624			(2,297	)		431,754
Selling and administrative expense		56,825			30,517			30,216			515			118,073
Net (gain) loss on disposition of equipment		—			(10,950	)		256			(632	)		(11,326	)
Earnings (loss) from operations		(53,479	)		164,514			216,152			(2,180	)		325,007
Other costs
Interest and foreign exchange		8,409			5,182			(2,556	)		(470	)		10,565
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(61,888	)		159,332			218,708			(1,710	)		314,442
Income tax (expense) benefit		(2,063	)		(52,706	)		(38,171	)		38			(92,902	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(63,951	)		106,626			180,537			(1,672	)		221,540
Earnings (loss) from unconsolidated affiliates		213,604			29,558			(16	)		(240,225	)		2,921
Net earnings (loss)		149,653			136,184			180,521			(241,897	)		224,461
Net (earnings) loss attributable to noncontrolling interest		—			—			(76,023	)		1,215			(74,808	)
Net earnings (loss) attributable to Greenbrier	$	149,653		$	136,184		$	104,498		$	(240,682	)	$	149,653

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	35,352	$	34,690	$	60,382		$	(70,892	)	$	59,532
Other comprehensive income (loss)
Translation adjustment		—		—		1,477			—			1,477
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		230		429			—			659
Unrealized gain on derivative financial instruments		5		3		1,105			—			1,113
Other (net of tax effect)		—		—		7			—			7
		5		233		3,018			—			3,256
Comprehensive income (loss)		35,357		34,923		63,400			(70,892	)		62,788
Comprehensive (income) loss attributable to noncontrolling interest		—		—		(22,594	)		(1,601	)		(24,195	)
Comprehensive income (loss) attributable to Greenbrier	$	35,357	$	34,923	$	40,806		$	(72,493	)	$	38,593

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the nine months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	149,653		$	136,184		$	180,521		$	(241,897	)	$	224,461
Other comprehensive income (loss)
Translation adjustment		1,527			—			(3,655	)		(1,527	)		(3,655	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—			746			964			—			1,710
Unrealized loss on derivative financial instruments		(23	)		(1,409	)		(4,985	)		—			(6,417	)
Other (net of tax effect)		—			—			1			—			1
		1,504			(663	)		(7,675	)		(1,527	)		(8,361	)
Comprehensive income (loss)		151,157			135,521			172,846			(243,424	)		216,100
Comprehensive (income) loss attributable to noncontrolling interest		—			—			(75,976	)		1,215			(74,761	)
Comprehensive income (loss) attributable to Greenbrier	$	151,157		$	135,521		$	96,870		$	(242,209	)	$	141,339

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Cash Flows

For the nine months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	149,653		$	136,184		$	180,521		$	(241,897	)	$	224,461
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes		15,000			(18,235	)		2,219			(9,127	)		(10,143	)
Depreciation and amortization		2,059			23,314			16,385			(77	)		41,681
Net gain on disposition of equipment		—			(10,950	)		256			(632	)		(11,326	)
Stock based compensation expense		19,055			—			—			—			19,055
Noncontrolling interest adjustment		—			—			—			837			837
Other		—			(32	)		596			—			564
Decrease (increase) in assets:
Accounts receivable, net		45,735			27,389			(27,697	)		(59,760	)		(14,333	)
Inventories		—			(82,518	)		58,013			9,159			(15,346	)
Leased railcars for syndication		—			36,802			—			(7,979	)		28,823
Other		(1,715	)		(1,666	)		(64,522	)		62,712			(5,191	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(48,102	)		(59,664	)		(34,987	)		54,046			(88,707	)
Deferred revenue		32,732			(8,710	)		281			—			24,303
Net cash provided by (used in) operating activities		214,417			41,914			131,065			(192,718	)		194,678
Cash flows from investing activities:
Proceeds from sales of assets		—			88,697			10			—			88,707
Capital expenditures		(2,796	)		(18,480	)		(30,431	)		—			(51,707	)
Decrease (increase) in restricted cash		—			201			(1	)		—			200
Investment in and net advances to unconsolidated affiliates		(176,356	)		(26,977	)		—			194,245			(9,088	)
Cash distribution from unconsolidated affiliates		5,338			—			—			—			5,338
Net cash provided by (used in) investing activities		(173,814	)		43,441			(30,422	)		194,245			33,450
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		(49,000	)		—			—			—			(49,000	)
Proceeds from revolving notes with maturities longer than 90 days		—			—			—			—			—
Repayment of revolving notes with maturities longer than 90 days		—			—			(1,888	)		—			(1,888	)
Repayments of notes payable		(13,981	)		(5,261	)		(219	)		—			(19,461	)
Debt issuance costs		(4,160	)		—			—			—			(4,160	)
Intercompany advances		75,289			(77,270	)		1,981			—			—
Repurchase of stock		(33,498	)		—			—			—			(33,498	)
Dividends		(17,362	)		—			—			—			(17,362	)
Cash contribution to joint venture partner		—			—			(62,710	)		—			(62,710	)
Investment by joint venture partner		—			—			5,400			—			5,400
Excess tax benefit from restricted stock awards		2,786			—			—			—			2,786
Other		—			—			(7	)		—			(7	)
Net cash provided by (used in) financing activities		(39,926	)		(82,531	)		(57,443	)		—			(179,900	)
Effect of exchange rate changes		1,505			(1,680	)		(5,016	)		(1,527	)		(6,718	)
Increase (decrease) in cash and cash equivalents		2,182			1,144			38,184			—			41,510
Cash and cash equivalents
Beginning of period		53,535			119			119,276			—			172,930
End of period	$	55,717		$	1,263		$	157,460		$	—		$	214,440

The Greenbrier Companies, Inc.

Condensed Consolidating Balance Sheet

August 31, 2015

(In thousands)

	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	53,535	$	119	$	119,276	$	—		$	172,930
Restricted cash		—		1,966		6,903		—			8,869
Accounts receivable, net		49,471		535,916		24,415		(413,773	)		196,029
Inventories		—		191,625		257,619		(3,709	)		445,535
Leased railcars for syndication		—		228,646		—		(16,112	)		212,534
Equipment on operating leases, net		—		255,130		2,901		(2,640	)		255,391
Property, plant and equipment, net		8,402		102,738		191,995		—			303,135
Investment in unconsolidated affiliates		1,209,698		169,659		21,369		(1,313,456	)		87,270
Intangibles and other assets, net		15,895		46,387		14,235		(10,963	)		65,554
Goodwill		—		43,265		—		—			43,265
	$	1,337,001	$	1,575,451	$	638,713	$	(1,760,653	)	$	1,790,512
Liabilities and Equity
Revolving notes	$	49,000	$	—	$	1,888	$	—		$	50,888
Accounts payable and accrued liabilities		421,249		282,662		208,538		(457,236	)		455,213
Deferred income taxes		—		72,326		—		(11,669	)		60,657
Deferred revenue		—		33,792		—		44			33,836
Notes payable		133,914		191,422		1,093		—			326,429
Total equity Greenbrier		732,838		995,249		296,852		(1,292,101	)		732,838
Noncontrolling interest		—		—		130,342		309			130,651
Total equity		732,838		995,249		427,194		(1,291,792	)		863,489
	$	1,337,001	$	1,575,451	$	638,713	$	(1,760,653	)	$	1,790,512

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the three months ended May 31, 2015

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	—		$	280,928		$	492,302		$	(179,854	)	$	593,376
Wheels & Parts		—			98,746			—			(1,339	)		97,407
Leasing & Services		(90	)		23,762			—			151			23,823
		(90	)		403,436			492,302			(181,042	)		714,606
Cost of revenue
Manufacturing		—			230,143			418,273			(182,758	)		465,658
Wheels & Parts		—			91,131			—			(1,486	)		89,645
Leasing & Services		—			10,041			—			(24	)		10,017
		—			331,315			418,273			(184,268	)		565,320
Margin		(90	)		72,121			74,029			3,226			149,286
Selling and administrative expense		24,851			10,688			9,912			144			45,595
Net (gain) loss on disposition of equipment		—			(724	)		7			(3	)		(720	)
Earnings (loss) from operations		(24,941	)		62,157			64,110			3,085			104,411
Other costs
Interest and foreign exchange		3,240			1,649			(604	)		—			4,285
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(28,181	)		60,508			64,714			3,085			100,126
Income tax (expense) benefit		4,215			(26,025	)		(7,888	)		(1,085	)		(30,783	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(23,966	)		34,483			56,826			2,000			69,343
Earnings (loss) from unconsolidated affiliates		66,777			5,142			47			(70,984	)		982
Net earnings (loss)		42,811			39,625			56,873			(68,984	)		70,325
Net earnings attributable to noncontrolling interest		—			—			(26,415	)		(1,099	)		(27,514	)
Net earnings (loss) attributable to Greenbrier	$	42,811		$	39,625		$	30,458		$	(70,083	)	$	42,811

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the nine months ended May 31, 2015

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	—		$	877,405		$	1,285,603		$	(684,442	)	$	1,478,566
Wheels & Parts		—			290,917			—			(4,246	)		286,671
Leasing & Services		83			74,064			1			428			74,576
		83			1,242,386			1,285,604			(688,260	)		1,839,813
Cost of revenue
Manufacturing		—			735,414			1,091,498			(641,990	)		1,184,922
Wheels & Parts		—			263,755			—			(4,470	)		259,285
Leasing & Services		—			33,014			—			(72	)		32,942
		—			1,032,183			1,091,498			(646,532	)		1,477,149
Margin		83			210,203			194,106			(41,728	)		362,664
Selling and administrative expense		55,116			26,905			30,169			33			112,223
Net (gain) loss on disposition of equipment		—			(927	)		7			(4	)		(924	)
Earnings (loss) from operations		(55,033	)		184,225			163,930			(41,757	)		251,365
Other costs
Interest and foreign exchange		9,345			4,998			(4,988	)		—			9,355
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(64,378	)		179,227			168,918			(41,757	)		242,010
Income tax (expense) benefit		(4,476	)		(62,438	)		(22,559	)		13,264			(76,209	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(68,854	)		116,789			146,359			(28,493	)		165,801
Earnings (loss) from unconsolidated affiliates		194,802			21,377			142			(214,769	)		1,552
Net earnings (loss)		125,948			138,166			146,501			(243,262	)		167,353
Net (earnings) loss attributable to noncontrolling interest		—			—			(61,992	)		20,587			(41,405	)
Net earnings (loss) attributable to Greenbrier	$	125,948		$	138,166		$	84,509		$	(222,675	)	$	125,948

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	42,811	$	39,625		$	56,873		$	(68,984	)	$	70,325
Other comprehensive income (loss)
Translation adjustment		—		(18	)		(1,281	)		—			(1,299	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		275			(529	)		—			(254	)
Unrealized gain (loss) on derivative financial instruments		—		(443	)		550			—			107
Other (net of tax effect)		—		—			93			—			93
		—		(186	)		(1,167	)		—			(1,353	)
Comprehensive income (loss)		42,811		39,439			55,706			(68,984	)		68,972
Comprehensive income attributable to noncontrolling interest		—		—			(26,398	)		(1,099	)		(27,497	)
Comprehensive income (loss) attributable to Greenbrier	$	42,811	$	39,439		$	29,308		$	(70,083	)	$	41,475

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the nine months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	125,948	$	138,166		$	146,501		$	(243,262	)	$	167,353
Other comprehensive income (loss)
Translation adjustment		—		(137	)		(10,853	)		—			(10,990	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		837			(420	)		—			417
Unrealized gain (loss) on derivative financial instruments		—		(1,640	)		1,633			—			(7	)
Other (net of tax effect)		—		—			99			—			99
		—		(940	)		(9,541	)		—			(10,481	)
Comprehensive income (loss)		125,948		137,226			136,960			(243,262	)		156,872
Comprehensive (income) loss attributable to noncontrolling interest		—		—			(61,840	)		20,587			(41,253	)
Comprehensive income (loss) attributable to Greenbrier	$	125,948	$	137,226		$	75,120		$	(222,675	)	$	115,619

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Cash Flows

For the nine months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	125,948		$	138,166		$	146,501		$	(243,262	)	$	167,353
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes		(138	)		(8,000	)		2,893			—			(5,245	)
Depreciation and amortization		1,484			19,909			11,936			(71	)		33,258
Net (gain)loss on disposition of equipment		—			(927	)		7			(4	)		(924	)
Stock based compensation expense		13,176			—			—			—			13,176
Noncontrolling interest adjustments		—			—			—			20,371			20,371
Other		43			105			860			—			1,008
Decrease (increase) in assets:
Accounts receivable, net		50			(10,046	)		37,034			(35,807	)		(8,769	)
Inventories		—			(39,279	)		(87,156	)		1,529			(124,906	)
Leased railcars for syndication		—			(109,324	)		—			18,410			(90,914	)
Other		20,641			763			(33,634	)		10,564			(1,666	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(3,824	)		25,612			9,112			(7,765	)		23,135
Deferred revenue		(122	)		4,078			(276	)		—			3,680
Net cash provided by (used in) operating activities		157,258			21,057			87,277			(236,035	)		29,557
Cash flows from investing activities:
Proceeds from sales of assets		—			4,623			5			—			4,628
Capital expenditures		(2,424	)		(18,807	)		(55,059	)		398			(75,892	)
Decrease (increase) in restricted cash		—			229			(1	)		—			228
Investment in and net advances to unconsolidated affiliates		(245,594	)		(19,966	)		—			235,637			(29,923	)
Cash distribution from unconsolidated affiliates		715			—			—			—			715
Net cash provided by (used in) investing activities		(247,303	)		(33,921	)		(55,055	)		236,035			(100,244	)
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		73,000			—			—			—			73,000
Proceeds from revolving notes with maturities longer than 90 days		—			—			42,563			—			42,563
Repayments of revolving notes with maturities longer than 90 days		—			—			(36,137	)		—			(36,137	)
Repayments of notes payable		(5	)		(5,280	)		(219	)		—			(5,504	)
Intercompany advances		(18,997	)		9,788			9,209			—			—
Repurchase of stock		(48,451	)		—			—			—			(48,451	)
Dividends		(12,069	)		—			—			—			(12,069	)
Decrease in restricted cash		—			11,000			—			—			11,000
Cash distributions to joint venture partner		—			—			(12,489	)		—			(12,489	)
Excess tax benefit from restricted stock awards		2,964			—			—			—			2,964
Other		(248	)		—			—			—			(248	)
Net cash provided by (used in) financing activities		(3,806	)		15,508			2,927			—			14,629
Effect of exchange rate changes		—			(2,269	)		(3,806	)		—			(6,075	)
Increase (decrease) in cash and cash equivalents		(93,851	)		375			31,343			—			(62,133	)
Cash and cash equivalents
Beginning of period		149,747			112			35,057			—			184,916
End of period	$	55,896		$	487		$	66,400		$	—		$	122,783

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Inventories (Tables)

9 Months Ended

May 31, 2016

Components of Inventories

The following table summarizes the Company’s inventory balance:

(In thousands)	May 31, 2016			August 31, 2015
Manufacturing supplies and raw materials	$	258,608		$	311,880
Work-in-process		63,602			75,032
Finished goods		139,199			61,302
Excess and obsolete adjustment		(3,341	)		(2,679	)
	$	458,068		$	445,535

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Intangibles and Other Assets, net (Tables)

9 Months Ended

May 31, 2016

Identifiable Intangible and Other Assets

The following table summarizes the Company’s identifiable intangible and other assets balance:

(In thousands)	May 31, 2016			August 31, 2015
Intangible assets subject to amortization:
Customer relationships	$	65,023		$	65,023
Accumulated amortization		(36,395	)		(33,828	)
Other intangibles		6,288			3,422
Accumulated amortization		(5,757	)		(3,121	)
		29,159			31,496
Intangible assets not subject to amortization		912			912
Prepaid and other assets		15,671			13,111
Nonqualified savings plan investments		15,093			11,815
Debt issuance costs, net		6,079			3,823
Assets held for sale		4,108			4,397
Total Intangible and other assets, net	$	71,022		$	65,554

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Accounts Payable and Accrued Liabilities (Tables)

9 Months Ended

May 31, 2016

Accounts Payable and Accrued Liabilities

(In thousands)	May 31, 2016		August 31, 2015
Trade payables	$	187,240	$	263,665
Other accrued liabilities		73,919		64,584
Accrued payroll and related liabilities		61,629		70,836
Accrued maintenance		18,488		18,642
Accrued warranty		12,132		11,512
Income taxes payable		11,604		22,465
Other		5,640		3,509
	$	370,652	$	455,213

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Warranty Accruals (Tables)

9 Months Ended

May 31, 2016

Warranty Accrual Activity

Warranty accrual activity:

(In thousands)	Three Months Ended May 31,						Nine Months Ended May 31,
	2016			2015			2016			2015
Balance at beginning of period	$	12,147		$	9,188		$	11,512		$	9,340
Charged to cost of revenue, net		1,202			2,036			4,086			3,982
Payments		(1,205	)		(994	)		(3,386	)		(2,797	)
Currency translation effect		(12	)		(32	)		(80	)		(327	)
Balance at end of period	$	12,132		$	10,198		$	12,132		$	10,198

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Accumulated Other Comprehensive Loss (Tables)

9 Months Ended

May 31, 2016

Components of Accumulated Other Comprehensive Loss, Net of Tax

Accumulated other comprehensive loss, net of tax effect as appropriate, consisted of the following:

(In thousands)	Unrealized Loss on Derivative Financial Instruments			Foreign Currency Translation Adjustment			Other			Accumulated Other Comprehensive Loss
Balance, August 31, 2015	$	(2,194	)	$	(18,666	)	$	(345	)	$	(21,205	)
Other comprehensive loss before reclassifications		(6,417	)		(3,608	)		1			(10,024	)
Amounts reclassified from accumulated other comprehensive loss		1,710			—			—			1,710
Balance, May 31, 2016	$	(6,901	)	$	(22,274	)	$	(344	)	$	(29,519	)

Amounts Reclassified out of Accumulated Other Comprehensive Loss

The amounts reclassified out of Accumulated other comprehensive loss into the Consolidated Statements of Income, with presentation location, were as follows:

	Three Months Ended May 31,						Nine Months Ended May 31,						Financial Statement Location
(In thousands)	2016			2015			2016			2015
(Gain) loss on derivative financial instruments:
Foreign exchange contracts	$	561		$	(652	)	$	1,203		$	(518	)	Revenue
Interest rate swap contracts		370			442			1,247			1,349		Interest and foreign exchange
		931			(210	)		2,450			831		Total before tax
		(272	)		(44	)		(740	)		(414	)	Tax expense
	$	659		$	(254	)	$	1,710		$	417		Net of tax

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Earnings Per Share (Tables)

9 Months Ended

May 31, 2016

Reconciliation of Shares Used in Computation of Basic and Diluted Earnings Per Common Share

The shares used in the computation of the Company’s basic and diluted earnings per common share are reconciled as follows:

(In thousands)	Three Months Ended May 31,				Nine Months Ended May 31,
	2016		2015		2016		2015
Weighted average basic common shares outstanding (1)		29,059		27,842		29,182		27,514
Dilutive effect of 2018 Convertible notes (2)		3,224		5,155		3,202		5,745
Dilutive effect of 2026 Convertible notes (3)		—		3		—		3
Dilutive effect of performance based restricted stock units (4)		59		—		91		—
Weighted average diluted common shares outstanding		32,342		33,000		32,475		33,262

(1) Restricted stock grants and restricted stock units, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position.

(2) The dilutive effect of the 2018 Convertible notes was included for the three and nine months ended May 31, 2016 and 2015 as they were considered dilutive under the “if converted” method as further discussed below.

(3) The dilutive effect of the 2026 Convertible notes was excluded for the three and nine months ended May 31, 2016 as the average stock price was less than the conversion price of $47.15 and therefore was considered anti-dilutive. The effect of the 2026 Convertible notes was included for the three and nine months ended May 31, 2015 as the average stock price was greater than the applicable conversion price, as further described below.

(4) Restricted stock units that are subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position.

Approach to Calculate Diluted Earning per Share

	Three Months Ended May 31,				Nine Months Ended May 31,
	2016		2015		2016		2015
Net earnings attributable to Greenbrier	$	35,352	$	42,811	$	149,653	$	125,948
Add back:
Interest and debt issuance costs on the 2018 Convertible notes, net of tax		733		1,234		1,962		4,066
Earnings before interest and debt issuance costs on convertible notes	$	36,085	$	44,045	$	151,615	$	130,014
Weighted average diluted common shares outstanding		32,342		33,000		32,475		33,262
Diluted earnings per share (1)	$	1.12	$	1.33	$	4.67	$	3.91

(1) Diluted earnings per share was calculated as follows:

Earnings before interest and debt issuance costs (net of tax) on convertible notes

Weighted average diluted common shares outstanding

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Derivative Instruments (Tables)

9 Months Ended

May 31, 2016

Fair Values of Derivative Instruments

Fair Values of Derivative Instruments

	Asset Derivatives					Liability Derivatives
		May 31, 2016		August 31, 2015			May 31, 2016		August 31, 2015
(In thousands)	Balance sheet location	Fair Value		Fair Value		Balance sheet location	Fair Value		Fair Value
Derivatives designated as hedging instruments
Foreign forward exchange contracts	Accounts receivable, net	$	3,640	$	1,820	Accounts payable and accrued liabilities	$	5,402	$	737
Interest rate swap contracts	Intangibles and other assets, net		—		—	Accounts payable and accrued liabilities		3,437		2,393
		$	3,640	$	1,820		$	8,839	$	3,130
Derivatives not designated as hedging instruments
Foreign forward exchange contracts	Accounts receivable, net	$	—	$	93	Accounts payable and accrued liabilities	$	190	$	76

Effect of Derivative Instruments on Statements of Income

The Effect of Derivative Instruments on the Statements of Income

Derivatives in cash flow hedging relationships	Location of gain (loss) recognized in income on derivatives	Gain (loss) recognized in income on derivatives nine months ended May 31,
		2016			2015
Foreign forward exchange contract	Interest and foreign exchange	$	(245	)	$	(22	)
Interest rate swap contracts	Interest and foreign exchange		88			69
		$	(157	)	$	47

Derivatives in cash flow hedging relationships	Gain (loss) recognized in OCI on derivatives (effective portion) nine months ended May 31,						Location of gain (loss) reclassified from accumulated OCI into income	Gain (loss) reclassified from accumulated OCI into income (effective portion) nine months ended May 31,						Location of gain on derivative (ineffective portion and amount excluded from effectiveness testing)	Gain recognized on derivative (ineffective portion and amount excluded from effectiveness testing) nine months ended May 31,
	2016			2015				2016			2015				2016		2015
Foreign forward exchange contracts	$	(5,430	)	$	1,867		Revenue	$	(835	)	$	518		Revenue	$	2,572	$	1,024
Foreign forward exchange contracts		(919	)		—		Cost of revenue		(412	)		—		Cost of revenue		88		—
Interest rate swap contracts		(2,274	)		(2,640	)	Interest and foreign exchange		(1,203	)		(1,349	)	Interest and foreign exchange		—		—
	$	(8,623	)	$	(773	)		$	(2,450	)	$	(831	)		$	2,660	$	1,024

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Segment Information (Tables)

9 Months Ended

May 31, 2016

Segments' Internal Financial Reports

The information in the following table is derived directly from the segments’ internal financial reports used for corporate management purposes. 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 months ended May 31, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	458,494	$	5,595		$	464,089		$	92,713		$	923		$	93,636
Wheels & Parts		78,417		10,058			88,475			5,811			711			6,522
Leasing & Services		75,955		601			76,556			8,298			601			8,899
Eliminations		—		(16,254	)		(16,254	)		—			(2,235	)		(2,235	)
Corporate		—		—			—			(22,693	)		—			(22,693	)
	$	612,866	$	—		$	612,866		$	84,129		$	—		$	84,129

For the nine months ended May 31, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,611,686	$	5,595		$	1,617,281		$	325,215		$	941		$	326,156
Wheels & Parts		247,604		24,074			271,678			15,720			2,155			17,875
Leasing & Services		225,044		10,444			235,488			42,668			10,444			53,112
Eliminations		—		(40,113	)		(40,113	)		—			(13,540	)		(13,540	)
Corporate		—		—			—			(58,596	)		—			(58,596	)
	$	2,084,334	$	—		$	2,084,334		$	325,007		$	—		$	325,007

For the three months ended May 31, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	593,376	$	33		$	593,409		$	115,675		$	—		$	115,675
Wheels & Parts		97,407		7,605			105,012			5,078			607			5,685
Leasing & Services		23,823		11,722			35,545			10,824			11,722			22,546
Eliminations		—		(19,360	)		(19,360	)		—			(12,329	)		(12,329	)
Corporate		—		—			—			(27,166	)		—			(27,166	)
	$	714,606	$	—		$	714,606		$	104,411		$	—		$	104,411

For the nine months ended May 31, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,478,566	$	7,534		$	1,486,100		$	258,602		$	795		$	259,397
Wheels & Parts		286,671		20,450			307,121			20,986			2,044			23,030
Leasing & Services		74,576		43,533			118,109			31,677			43,533			75,210
Eliminations		—		(71,517	)		(71,517	)		—			(46,372	)		(46,372	)
Corporate		—		—			—			(59,900	)		—			(59,900	)
	$	1,839,813	$	—		$	1,839,813		$	251,365		$	—		$	251,365

	Total assets
	May 31,		August 31,
(In thousands)	2016		2015
Manufacturing	$	641,090	$	675,409
Wheels & Parts		301,474		291,798
Leasing & Services		523,989		549,073
Unallocated		319,331		274,232
	$	1,785,884	$	1,790,512

Reconciliation of Earnings from Operations to Earnings Before Income Tax and Earnings from Unconsolidated Affiliates

Reconciliation of Earnings from operations to Earnings before income tax and earnings from unconsolidated affiliates:

	Three Months Ended May 31,				Nine Months Ended May 31,
(In thousands)	2016		2015		2016		2015
Earnings from operations	$	84,129	$	104,411	$	325,007	$	251,365
Interest and foreign exchange		3,712		4,285		10,565		9,355
Earnings before income tax and earnings from unconsolidated affiliates	$	80,417	$	100,126	$	314,442	$	242,010

GBW Railcar Services Holdings, LLC

Segments' Internal Financial Reports

The results of operations for the GBW Joint Venture are accounted for under the equity method of accounting. The GBW Joint Venture is the Company’s fourth reportable segment and information as of May 31, 2016 and August 31, 2015 and for the three and nine months ended May 31, 2016 and 2015 are included in the tables below.

	Three Months Ended May 31,				Nine Months Ended May 31,
(In thousands)	2016		2015		2016		2015
Revenue	$	95,699	$	88,831	$	289,381	$	254,688
Earnings (loss) from operations	$	3,030	$	227	$	9,065	$	(1,507	)
	Total Assets
	May 31, 2016		August 31, 2015
GBW (1)	$	255,400	$	239,871

⁽¹⁾  Includes goodwill and intangible assets of $94.4 million and $96.9 million as of May 31, 2016 and August 31, 2015.

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Fair Value Measures (Tables)

9 Months Ended

May 31, 2016

Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis as of May 31, 2016 were:

(In thousands)	Total		Level 1		Level 2 (1)		Level 3
Assets:
Derivative financial instruments	$	3,640	$	—	$	3,640	$	—
Nonqualified savings plan investments		15,093		15,093		—		—
Cash equivalents		5,076		5,076		—		—
	$	23,809	$	20,169	$	3,640	$	—
Liabilities:
Derivative financial instruments	$	9,029	$	—	$	9,029	$	—

(1) Level 2 assets and liabilities include derivative financial instruments that are valued based on observable inputs. See Note 11 Derivative Instruments for further discussion.

Assets and liabilities measured at fair value on a recurring basis as of August 31, 2015 were:

(In thousands)	Total		Level 1		Level 2		Level 3
Assets:
Derivative financial instruments	$	1,913	$	—	$	1,913	$	—
Nonqualified savings plan investments		11,815		11,815		—		—
Cash equivalents		5,071		5,071		—		—
	$	18,799	$	16,886	$	1,913	$	—
Liabilities:
Derivative financial instruments	$	3,206	$	—	$	3,206	$	—

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Guarantor/Non-Guarantor (Tables)

9 Months Ended

May 31, 2016

Condensed Consolidating Balance Sheet

The Greenbrier Companies, Inc.

Condensed Consolidating Balance Sheet

May 31, 2016

(In thousands, unaudited)

	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	55,717	$	1,263	$	157,460	$	—		$	214,440
Restricted cash		—		1,765		6,904		—			8,669
Accounts receivable, net		3,736		585,797		49,529		(425,552	)		213,510
Inventories		—		272,481		198,455		(12,868	)		458,068
Leased railcars for syndication		—		139,827		—		(3,015	)		136,812
Equipment on operating leases, net		—		232,900		2,709		(2,818	)		232,791
Property, plant and equipment, net		9,139		104,302		204,569		—			318,010
Investment in unconsolidated affiliates		1,367,146		198,977		21,056		(1,497,882	)		89,297
Intangibles and other assets, net		21,185		44,083		14,036		(8,282	)		71,022
Goodwill		—		43,265		—		—			43,265
	$	1,456,923	$	1,624,660	$	654,718	$	(1,950,417	)	$	1,785,884
Liabilities and Equity
Revolving notes	$	—	$	—	$	—	$	—		$	—
Accounts payable and accrued liabilities		449,757		223,954		170,823		(473,882	)		370,652
Deferred income taxes		14,415		54,090		—		(18,115	)		50,390
Deferred revenue		32,732		30,870		281		4,275			68,158
Notes payable		119,933		186,000		875		—			306,808
Total equity - Greenbrier		840,086		1,129,746		332,880		(1,462,626	)		840,086
Noncontrolling interest		—		—		149,859		(69	)		149,790
Total equity		840,086		1,129,746		482,739		(1,462,695	)		989,876
	$	1,456,923	$	1,624,660	$	654,718	$	(1,950,417	)	$	1,785,884

The Greenbrier Companies, Inc.

Condensed Consolidating Balance Sheet

August 31, 2015

(In thousands)

	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Cash and cash equivalents	$	53,535	$	119	$	119,276	$	—		$	172,930
Restricted cash		—		1,966		6,903		—			8,869
Accounts receivable, net		49,471		535,916		24,415		(413,773	)		196,029
Inventories		—		191,625		257,619		(3,709	)		445,535
Leased railcars for syndication		—		228,646		—		(16,112	)		212,534
Equipment on operating leases, net		—		255,130		2,901		(2,640	)		255,391
Property, plant and equipment, net		8,402		102,738		191,995		—			303,135
Investment in unconsolidated affiliates		1,209,698		169,659		21,369		(1,313,456	)		87,270
Intangibles and other assets, net		15,895		46,387		14,235		(10,963	)		65,554
Goodwill		—		43,265		—		—			43,265
	$	1,337,001	$	1,575,451	$	638,713	$	(1,760,653	)	$	1,790,512
Liabilities and Equity
Revolving notes	$	49,000	$	—	$	1,888	$	—		$	50,888
Accounts payable and accrued liabilities		421,249		282,662		208,538		(457,236	)		455,213
Deferred income taxes		—		72,326		—		(11,669	)		60,657
Deferred revenue		—		33,792		—		44			33,836
Notes payable		133,914		191,422		1,093		—			326,429
Total equity Greenbrier		732,838		995,249		296,852		(1,292,101	)		732,838
Noncontrolling interest		—		—		130,342		309			130,651
Total equity		732,838		995,249		427,194		(1,291,792	)		863,489
	$	1,337,001	$	1,575,451	$	638,713	$	(1,760,653	)	$	1,790,512

Condensed Consolidating Statement of Income

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the three months ended May 31, 2016

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	(1,055	)	$	235,613		$	419,441		$	(195,505	)	$	458,494
Wheels & Parts		—			82,292			—			(3,875	)		78,417
Leasing & Services		1,294			74,668			—			(7	)		75,955
		239			392,573			419,441			(199,387	)		612,866
Cost of revenue
Manufacturing		—			216,829			334,498			(198,552	)		352,775
Wheels & Parts		—			73,475			—			(3,657	)		69,818
Leasing & Services		—			63,201			—			(26	)		63,175
		—			353,505			334,498			(202,235	)		485,768
Margin		239			39,068			84,943			2,848			127,098
Selling and administrative expense		22,933			10,672			9,494			181			43,280
Net (gain) loss on disposition of equipment		—			(308	)		254			(257	)		(311	)
Earnings (loss) from operations		(22,694	)		28,704			75,195			2,924			84,129
Other costs
Interest and foreign exchange		2,069			1,910			(83	)		(184	)		3,712
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(24,763	)		26,794			75,278			3,108			80,417
Income tax (expense) benefit		1,460			(7,556	)		(15,244	)		(1,109	)		(22,449	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(23,303	)		19,238			60,034			1,999			57,968
Earnings (loss) from unconsolidated affiliates		58,655			15,452			348			(72,891	)		1,564
Net earnings (loss)		35,352			34,690			60,382			(70,892	)		59,532
Net (earnings) loss attributable to noncontrolling interest		—			—			(22,579	)		(1,601	)		(24,180	)
Net earnings (loss) attributable to Greenbrier	$	35,352		$	34,690		$	37,803		$	(72,493	)	$	35,352

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the nine months ended May 31, 2016

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	1,992		$	862,856		$	1,336,226		$	(589,388	)	$	1,611,686
Wheels & Parts		—			252,744			—			(5,140	)		247,604
Leasing & Services		1,354			223,683			1			6			225,044
		3,346			1,339,283			1,336,227			(594,522	)		2,084,334
Cost of revenue
Manufacturing		—			745,419			1,089,603			(587,387	)		1,247,635
Wheels & Parts		—			228,969			—			(4,761	)		224,208
Leasing & Services		—			180,814			—			(77	)		180,737
		—			1,155,202			1,089,603			(592,225	)		1,652,580
Margin		3,346			184,081			246,624			(2,297	)		431,754
Selling and administrative expense		56,825			30,517			30,216			515			118,073
Net (gain) loss on disposition of equipment		—			(10,950	)		256			(632	)		(11,326	)
Earnings (loss) from operations		(53,479	)		164,514			216,152			(2,180	)		325,007
Other costs
Interest and foreign exchange		8,409			5,182			(2,556	)		(470	)		10,565
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(61,888	)		159,332			218,708			(1,710	)		314,442
Income tax (expense) benefit		(2,063	)		(52,706	)		(38,171	)		38			(92,902	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(63,951	)		106,626			180,537			(1,672	)		221,540
Earnings (loss) from unconsolidated affiliates		213,604			29,558			(16	)		(240,225	)		2,921
Net earnings (loss)		149,653			136,184			180,521			(241,897	)		224,461
Net (earnings) loss attributable to noncontrolling interest		—			—			(76,023	)		1,215			(74,808	)
Net earnings (loss) attributable to Greenbrier	$	149,653		$	136,184		$	104,498		$	(240,682	)	$	149,653

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the three months ended May 31, 2015

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	—		$	280,928		$	492,302		$	(179,854	)	$	593,376
Wheels & Parts		—			98,746			—			(1,339	)		97,407
Leasing & Services		(90	)		23,762			—			151			23,823
		(90	)		403,436			492,302			(181,042	)		714,606
Cost of revenue
Manufacturing		—			230,143			418,273			(182,758	)		465,658
Wheels & Parts		—			91,131			—			(1,486	)		89,645
Leasing & Services		—			10,041			—			(24	)		10,017
		—			331,315			418,273			(184,268	)		565,320
Margin		(90	)		72,121			74,029			3,226			149,286
Selling and administrative expense		24,851			10,688			9,912			144			45,595
Net (gain) loss on disposition of equipment		—			(724	)		7			(3	)		(720	)
Earnings (loss) from operations		(24,941	)		62,157			64,110			3,085			104,411
Other costs
Interest and foreign exchange		3,240			1,649			(604	)		—			4,285
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(28,181	)		60,508			64,714			3,085			100,126
Income tax (expense) benefit		4,215			(26,025	)		(7,888	)		(1,085	)		(30,783	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(23,966	)		34,483			56,826			2,000			69,343
Earnings (loss) from unconsolidated affiliates		66,777			5,142			47			(70,984	)		982
Net earnings (loss)		42,811			39,625			56,873			(68,984	)		70,325
Net earnings attributable to noncontrolling interest		—			—			(26,415	)		(1,099	)		(27,514	)
Net earnings (loss) attributable to Greenbrier	$	42,811		$	39,625		$	30,458		$	(70,083	)	$	42,811

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Income

For the nine months ended May 31, 2015

(In thousands, unaudited)

	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenue
Manufacturing	$	—		$	877,405		$	1,285,603		$	(684,442	)	$	1,478,566
Wheels & Parts		—			290,917			—			(4,246	)		286,671
Leasing & Services		83			74,064			1			428			74,576
		83			1,242,386			1,285,604			(688,260	)		1,839,813
Cost of revenue
Manufacturing		—			735,414			1,091,498			(641,990	)		1,184,922
Wheels & Parts		—			263,755			—			(4,470	)		259,285
Leasing & Services		—			33,014			—			(72	)		32,942
		—			1,032,183			1,091,498			(646,532	)		1,477,149
Margin		83			210,203			194,106			(41,728	)		362,664
Selling and administrative expense		55,116			26,905			30,169			33			112,223
Net (gain) loss on disposition of equipment		—			(927	)		7			(4	)		(924	)
Earnings (loss) from operations		(55,033	)		184,225			163,930			(41,757	)		251,365
Other costs
Interest and foreign exchange		9,345			4,998			(4,988	)		—			9,355
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates		(64,378	)		179,227			168,918			(41,757	)		242,010
Income tax (expense) benefit		(4,476	)		(62,438	)		(22,559	)		13,264			(76,209	)
Earnings (loss) before earnings (loss) from unconsolidated affiliates		(68,854	)		116,789			146,359			(28,493	)		165,801
Earnings (loss) from unconsolidated affiliates		194,802			21,377			142			(214,769	)		1,552
Net earnings (loss)		125,948			138,166			146,501			(243,262	)		167,353
Net (earnings) loss attributable to noncontrolling interest		—			—			(61,992	)		20,587			(41,405	)
Net earnings (loss) attributable to Greenbrier	$	125,948		$	138,166		$	84,509		$	(222,675	)	$	125,948

Condensed Consolidating Statement of Comprehensive Income (Loss)

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries		Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	35,352	$	34,690	$	60,382		$	(70,892	)	$	59,532
Other comprehensive income (loss)
Translation adjustment		—		—		1,477			—			1,477
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		230		429			—			659
Unrealized gain on derivative financial instruments		5		3		1,105			—			1,113
Other (net of tax effect)		—		—		7			—			7
		5		233		3,018			—			3,256
Comprehensive income (loss)		35,357		34,923		63,400			(70,892	)		62,788
Comprehensive (income) loss attributable to noncontrolling interest		—		—		(22,594	)		(1,601	)		(24,195	)
Comprehensive income (loss) attributable to Greenbrier	$	35,357	$	34,923	$	40,806		$	(72,493	)	$	38,593

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the nine months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	149,653		$	136,184		$	180,521		$	(241,897	)	$	224,461
Other comprehensive income (loss)
Translation adjustment		1,527			—			(3,655	)		(1,527	)		(3,655	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—			746			964			—			1,710
Unrealized loss on derivative financial instruments		(23	)		(1,409	)		(4,985	)		—			(6,417	)
Other (net of tax effect)		—			—			1			—			1
		1,504			(663	)		(7,675	)		(1,527	)		(8,361	)
Comprehensive income (loss)		151,157			135,521			172,846			(243,424	)		216,100
Comprehensive (income) loss attributable to noncontrolling interest		—			—			(75,976	)		1,215			(74,761	)
Comprehensive income (loss) attributable to Greenbrier	$	151,157		$	135,521		$	96,870		$	(242,209	)	$	141,339

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the three months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	42,811	$	39,625		$	56,873		$	(68,984	)	$	70,325
Other comprehensive income (loss)
Translation adjustment		—		(18	)		(1,281	)		—			(1,299	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		275			(529	)		—			(254	)
Unrealized gain (loss) on derivative financial instruments		—		(443	)		550			—			107
Other (net of tax effect)		—		—			93			—			93
		—		(186	)		(1,167	)		—			(1,353	)
Comprehensive income (loss)		42,811		39,439			55,706			(68,984	)		68,972
Comprehensive income attributable to noncontrolling interest		—		—			(26,398	)		(1,099	)		(27,497	)
Comprehensive income (loss) attributable to Greenbrier	$	42,811	$	39,439		$	29,308		$	(70,083	)	$	41,475

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Comprehensive Income (Loss)

For the nine months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent		Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net earnings (loss)	$	125,948	$	138,166		$	146,501		$	(243,262	)	$	167,353
Other comprehensive income (loss)
Translation adjustment		—		(137	)		(10,853	)		—			(10,990	)
Reclassification of derivative financial instruments recognized in net earnings (loss)		—		837			(420	)		—			417
Unrealized gain (loss) on derivative financial instruments		—		(1,640	)		1,633			—			(7	)
Other (net of tax effect)		—		—			99			—			99
		—		(940	)		(9,541	)		—			(10,481	)
Comprehensive income (loss)		125,948		137,226			136,960			(243,262	)		156,872
Comprehensive (income) loss attributable to noncontrolling interest		—		—			(61,840	)		20,587			(41,253	)
Comprehensive income (loss) attributable to Greenbrier	$	125,948	$	137,226		$	75,120		$	(222,675	)	$	115,619

Condensed Consolidating Statement of Cash Flows

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Cash Flows

For the nine months ended May 31, 2016

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	149,653		$	136,184		$	180,521		$	(241,897	)	$	224,461
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes		15,000			(18,235	)		2,219			(9,127	)		(10,143	)
Depreciation and amortization		2,059			23,314			16,385			(77	)		41,681
Net gain on disposition of equipment		—			(10,950	)		256			(632	)		(11,326	)
Stock based compensation expense		19,055			—			—			—			19,055
Noncontrolling interest adjustment		—			—			—			837			837
Other		—			(32	)		596			—			564
Decrease (increase) in assets:
Accounts receivable, net		45,735			27,389			(27,697	)		(59,760	)		(14,333	)
Inventories		—			(82,518	)		58,013			9,159			(15,346	)
Leased railcars for syndication		—			36,802			—			(7,979	)		28,823
Other		(1,715	)		(1,666	)		(64,522	)		62,712			(5,191	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(48,102	)		(59,664	)		(34,987	)		54,046			(88,707	)
Deferred revenue		32,732			(8,710	)		281			—			24,303
Net cash provided by (used in) operating activities		214,417			41,914			131,065			(192,718	)		194,678
Cash flows from investing activities:
Proceeds from sales of assets		—			88,697			10			—			88,707
Capital expenditures		(2,796	)		(18,480	)		(30,431	)		—			(51,707	)
Decrease (increase) in restricted cash		—			201			(1	)		—			200
Investment in and net advances to unconsolidated affiliates		(176,356	)		(26,977	)		—			194,245			(9,088	)
Cash distribution from unconsolidated affiliates		5,338			—			—			—			5,338
Net cash provided by (used in) investing activities		(173,814	)		43,441			(30,422	)		194,245			33,450
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		(49,000	)		—			—			—			(49,000	)
Proceeds from revolving notes with maturities longer than 90 days		—			—			—			—			—
Repayment of revolving notes with maturities longer than 90 days		—			—			(1,888	)		—			(1,888	)
Repayments of notes payable		(13,981	)		(5,261	)		(219	)		—			(19,461	)
Debt issuance costs		(4,160	)		—			—			—			(4,160	)
Intercompany advances		75,289			(77,270	)		1,981			—			—
Repurchase of stock		(33,498	)		—			—			—			(33,498	)
Dividends		(17,362	)		—			—			—			(17,362	)
Cash contribution to joint venture partner		—			—			(62,710	)		—			(62,710	)
Investment by joint venture partner		—			—			5,400			—			5,400
Excess tax benefit from restricted stock awards		2,786			—			—			—			2,786
Other		—			—			(7	)		—			(7	)
Net cash provided by (used in) financing activities		(39,926	)		(82,531	)		(57,443	)		—			(179,900	)
Effect of exchange rate changes		1,505			(1,680	)		(5,016	)		(1,527	)		(6,718	)
Increase (decrease) in cash and cash equivalents		2,182			1,144			38,184			—			41,510
Cash and cash equivalents
Beginning of period		53,535			119			119,276			—			172,930
End of period	$	55,717		$	1,263		$	157,460		$	—		$	214,440

The Greenbrier Companies, Inc.

Condensed Consolidating Statement of Cash Flows

For the nine months ended May 31, 2015

(In thousands, unaudited)

(In thousands)	Parent			Combined Guarantor Subsidiaries			Combined Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net earnings (loss)	$	125,948		$	138,166		$	146,501		$	(243,262	)	$	167,353
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes		(138	)		(8,000	)		2,893			—			(5,245	)
Depreciation and amortization		1,484			19,909			11,936			(71	)		33,258
Net (gain)loss on disposition of equipment		—			(927	)		7			(4	)		(924	)
Stock based compensation expense		13,176			—			—			—			13,176
Noncontrolling interest adjustments		—			—			—			20,371			20,371
Other		43			105			860			—			1,008
Decrease (increase) in assets:
Accounts receivable, net		50			(10,046	)		37,034			(35,807	)		(8,769	)
Inventories		—			(39,279	)		(87,156	)		1,529			(124,906	)
Leased railcars for syndication		—			(109,324	)		—			18,410			(90,914	)
Other		20,641			763			(33,634	)		10,564			(1,666	)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities		(3,824	)		25,612			9,112			(7,765	)		23,135
Deferred revenue		(122	)		4,078			(276	)		—			3,680
Net cash provided by (used in) operating activities		157,258			21,057			87,277			(236,035	)		29,557
Cash flows from investing activities:
Proceeds from sales of assets		—			4,623			5			—			4,628
Capital expenditures		(2,424	)		(18,807	)		(55,059	)		398			(75,892	)
Decrease (increase) in restricted cash		—			229			(1	)		—			228
Investment in and net advances to unconsolidated affiliates		(245,594	)		(19,966	)		—			235,637			(29,923	)
Cash distribution from unconsolidated affiliates		715			—			—			—			715
Net cash provided by (used in) investing activities		(247,303	)		(33,921	)		(55,055	)		236,035			(100,244	)
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less		73,000			—			—			—			73,000
Proceeds from revolving notes with maturities longer than 90 days		—			—			42,563			—			42,563
Repayments of revolving notes with maturities longer than 90 days		—			—			(36,137	)		—			(36,137	)
Repayments of notes payable		(5	)		(5,280	)		(219	)		—			(5,504	)
Intercompany advances		(18,997	)		9,788			9,209			—			—
Repurchase of stock		(48,451	)		—			—			—			(48,451	)
Dividends		(12,069	)		—			—			—			(12,069	)
Decrease in restricted cash		—			11,000			—			—			11,000
Cash distributions to joint venture partner		—			—			(12,489	)		—			(12,489	)
Excess tax benefit from restricted stock awards		2,964			—			—			—			2,964
Other		(248	)		—			—			—			(248	)
Net cash provided by (used in) financing activities		(3,806	)		15,508			2,927			—			14,629
Effect of exchange rate changes		—			(2,269	)		(3,806	)		—			(6,075	)
Increase (decrease) in cash and cash equivalents		(93,851	)		375			31,343			—			(62,133	)
Cash and cash equivalents
Beginning of period		149,747			112			35,057			—			184,916
End of period	$	55,896		$	487		$	66,400		$	—		$	122,783

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Interim Financial Statements - Additional Information (Detail) - USD ($)	3 Months Ended	9 Months Ended		33 Months Ended
	May 31, 2016	May 31, 2016	May 31, 2015	May 31, 2016	Oct. 31, 2013
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program total cost of repurchased shares		$ 32,373,000	$ 48,451,000
Share Repurchase Program - 2014
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program total cost of repurchased shares		$ 32,400,000		$ 137,000,000
Repurchase of common stock, shares	0	1,054,687		3,206,226
Remaining authorized repurchase amount	$ 88,000,000	$ 88,000,000		$ 88,000,000
Repurchase program expiration date	Jan. 01, 2018
Maximum | Share Repurchase Program - 2013
Equity, Class of Treasury Stock [Line Items]
Amount authorized for repurchase					$ 225,000,000

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Components of Inventories (Detail) - USD ($) $ in Thousands	May 31, 2016	Aug. 31, 2015
Inventory [Line Items]
Manufacturing supplies and raw materials	$ 258,608	$ 311,880
Work-in-process	63,602	75,032
Finished goods	139,199	61,302
Excess and obsolete adjustment	(3,341)	(2,679)
Inventories	$ 458,068	$ 445,535

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Identifiable Intangible and Other Assets (Detail) - USD ($) $ in Thousands	May 31, 2016	Aug. 31, 2015
Intangibles and Other Assets by Major Class [Line Items]
Finite-Lived Intangible Assets, Net, Total	$ 29,159	$ 31,496
Intangible assets not subject to amortization	912	912
Prepaid and other assets	15,671	13,111
Nonqualified savings plan investments	15,093	11,815
Debt issuance costs, net	6,079	3,823
Assets held for sale	4,108	4,397
Total Intangible and other assets, net	71,022	65,554
Customer Relationships
Intangibles and Other Assets by Major Class [Line Items]
Finite lived intangible assets gross	65,023	65,023
Accumulated amortization	(36,395)	(33,828)
Other Intangible Assets
Intangibles and Other Assets by Major Class [Line Items]
Finite lived intangible assets gross	6,288	3,422
Accumulated amortization	$ (5,757)	$ (3,121)

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Intangibles and Other Assets, Net - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Schedule of Intangible Assets Disclosure [Line Items]
Amortization expense	$ 1.5	$ 0.9	$ 5.3	$ 2.7
Future amortization expense, 2016	6.3		6.3
Future amortization expense, 2017	3.6		3.6
Future amortization expense, 2018	3.5		3.5
Future amortization expense, 2019	3.4		3.4
Future amortization expense, 2020	$ 3.4		$ 3.4

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Revolving Notes - Additional Information (Detail)	9 Months Ended
	May 31, 2016 USD ($) CreditFacility Facility	Aug. 31, 2015 USD ($)
Line of Credit Facility [Line Items]
Revolving notes		$ 50,888,000
Senior Secured Credit Facilities, Consisting of 3 Components
Line of Credit Facility [Line Items]
Number of senior secured credit facilities | CreditFacility	3
Line of credit facility maximum capacity	$ 615,500,000
Letter of credit facility outstanding amount	81,300,000	47,200,000
Revolving Line of Credit, 1st Component of Senior Secured Credit Facilities
Line of Credit Facility [Line Items]
Line of credit facility maximum capacity	$ 550,000,000
Line of credit maturity date	2020-10
Revolving notes		49,000,000
Revolving Line of Credit, 1st Component of Senior Secured Credit Facilities | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, percentage points added to the reference rate	1.75%
Revolving Line of Credit, 1st Component of Senior Secured Credit Facilities | Prime Rate
Line of Credit Facility [Line Items]
Debt instrument, percentage points added to the reference rate	0.75%
European Line of Credit, 2nd Component of Senior Secured Credit Facilities
Line of Credit Facility [Line Items]
Line of credit facility maximum capacity	$ 15,500,000
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | Minimum
Line of Credit Facility [Line Items]
Line of credit maturity date	2017-02
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | Maximum
Line of Credit Facility [Line Items]
Line of credit maturity date	2017-06
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | WIBOR | Minimum
Line of Credit Facility [Line Items]
Debt instrument, percentage points added to the reference rate	1.20%
European Line of Credit, 2nd Component of Senior Secured Credit Facilities | WIBOR | Maximum
Line of Credit Facility [Line Items]
Debt instrument, percentage points added to the reference rate	1.30%
Mexican Railcar Manufacturing Joint Venture Line of Credit, 3rd Component of Senior Secured Credit Facilities
Line of Credit Facility [Line Items]
Line of credit facility maximum capacity	$ 50,000,000
Number of lines of credits | Facility	2
Revolving notes		$ 1,900,000
Mexican Railcar Manufacturing Joint Venture Line of Credit 1, 3rd Component of Senior Secured Credit Facilities
Line of Credit Facility [Line Items]
Line of credit facility maximum capacity	$ 30,000,000
Line of credit facility borrowings outstanding due period	2019-01
Mexican Railcar Manufacturing Joint Venture Line of Credit 1, 3rd Component of Senior Secured Credit Facilities | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, percentage points added to the reference rate	2.00%
Mexican Railcar Manufacturing Joint Venture Line of Credit 2, 3rd Component of Senior Secured Credit Facilities
Line of Credit Facility [Line Items]
Line of credit facility maximum capacity	$ 20,000,000
Line of credit facility borrowings outstanding due period	2017-08
Joint venture partner each guaranteed percentage	50.00%
Mexican Railcar Manufacturing Joint Venture Line of Credit 2, 3rd Component of Senior Secured Credit Facilities | LIBOR
Line of Credit Facility [Line Items]
Debt instrument, percentage points added to the reference rate	2.00%

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Accounts Payable and Accrued Liabilities (Detail) - USD ($) $ in Thousands	May 31, 2016	Feb. 29, 2016	Aug. 31, 2015	May 31, 2015	Feb. 28, 2015	Aug. 31, 2014
Accounts Payable and Accrued Liabilities [Line Items]
Trade payables	$ 187,240		$ 263,665
Other accrued liabilities	73,919		64,584
Accrued payroll and related liabilities	61,629		70,836
Accrued maintenance	18,488		18,642
Accrued warranty	12,132	$ 12,147	11,512	$ 10,198	$ 9,188	$ 9,340
Income taxes payable	11,604		22,465
Other	5,640		3,509
Accounts payable and accrued liabilities	$ 370,652		$ 455,213

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Warranty Accruals Activity (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Product Liability Contingency [Line Items]
Balance at beginning of period	$ 12,147	$ 9,188	$ 11,512	$ 9,340
Charged to cost of revenue, net	1,202	2,036	4,086	3,982
Payments	(1,205)	(994)	(3,386)	(2,797)
Currency translation effect	(12)	(32)	(80)	(327)
Balance at end of period	$ 12,132	$ 10,198	$ 12,132	$ 10,198

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Notes Payable - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	May 31, 2016	May 31, 2016	May 31, 2015	Aug. 31, 2015
Debt Instrument [Line Items]
Notes payable	$ 306,808	$ 306,808		$ 326,429
Payment of aggregate principal amount of notes		19,461	$ 5,504
2026 Senior Notes
Debt Instrument [Line Items]
Notes payable	306,800	$ 306,800
Debt instrument, maturity date		2026
Repurchase percentage price of principal of notes amount		100.00%
Payment of aggregate principal amount of notes	14,000
Convertible senior notes	900	$ 900
2026 Senior Notes | Put Option
Debt Instrument [Line Items]
Convertible senior notes	$ 14,900	$ 14,900

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Components of Accumulated Other Comprehensive Loss, Net of Tax (Detail) $ in Thousands	9 Months Ended
	May 31, 2016 USD ($)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	$ (21,205)
Other comprehensive loss before reclassifications	(10,024)
Amounts reclassified from accumulated other comprehensive loss	1,710
Ending balance	(29,519)
Unrealized (Gain) Loss on Derivative Financial Instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(2,194)
Other comprehensive loss before reclassifications	(6,417)
Amounts reclassified from accumulated other comprehensive loss	1,710
Ending balance	(6,901)
Foreign Currency Translation Adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(18,666)
Other comprehensive loss before reclassifications	(3,608)
Ending balance	(22,274)
Other
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance	(345)
Other comprehensive loss before reclassifications	1
Ending balance	$ (344)

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Amounts Reclassified out of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Revenue	$ 612,866	$ 714,606	$ 2,084,334	$ 1,839,813
Interest and foreign exchange	3,712	4,285	10,565	9,355
Earnings before income taxes and earnings from unconsolidated affiliates	80,417	100,126	314,442	242,010
Tax expense	(22,449)	(30,783)	(92,902)	(76,209)
Unrealized (Gain) Loss on Derivative Financial Instruments | Reclassification out of Accumulated Other Comprehensive loss
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Earnings before income taxes and earnings from unconsolidated affiliates	931	(210)	2,450	831
Tax expense	(272)	(44)	(740)	(414)
Net of tax	659	(254)	1,710	417
Unrealized (Gain) Loss on Derivative Financial Instruments | Reclassification out of Accumulated Other Comprehensive loss | Foreign Exchange Contracts
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Revenue	561	(652)	1,203	(518)
Unrealized (Gain) Loss on Derivative Financial Instruments | Reclassification out of Accumulated Other Comprehensive loss | Interest rate swap contracts
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items]
Interest and foreign exchange	$ 370	$ 442	$ 1,247	$ 1,349

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Reconciliation of Basic and Diluted Earnings Per Common Share (Detail) - shares shares in Thousands		3 Months Ended		9 Months Ended
		May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Earnings Per Share Disclosure [Line Items]
Weighted average basic common shares outstanding	[1]	29,059	27,842	29,182	27,514
Dilutive effect of performance based restricted stock units	[2]	59		91
Weighted average diluted common shares outstanding		32,342	33,000	32,475	33,262
2018 Senior Notes
Earnings Per Share Disclosure [Line Items]
Dilutive effect of convertible notes	[3]	3,224	5,155	3,202	5,745
2026 Senior Notes
Earnings Per Share Disclosure [Line Items]
Dilutive effect of convertible notes	[4]		3		3

[1] Restricted stock grants and restricted stock units, including some grants subject to certain performance criteria, are included in weighted average basic common shares outstanding when the Company is in a net earnings position.

[2] Restricted stock units that are subject to performance criteria, for which actual levels of performance above target have been achieved, are included in weighted average diluted common shares outstanding when the Company is in a net earnings position.

[3] The dilutive effect of the 2018 Convertible notes was included for the three and nine months ended May 31, 2016 and 2015 as they were considered dilutive under the "if converted" method as further discussed below.

[4] The dilutive effect of the 2026 Convertible notes was excluded for the three and nine months ended May 31, 2016 as the average stock price was less than the conversion price of $47.15 and therefore was considered anti-dilutive. The effect of the 2026 Convertible notes was included for the three and nine months ended May 31, 2015 as the average stock price was greater than the applicable conversion price, as further described below.

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Reconciliation of Basic and Diluted Earnings Per Common Share (Parenthetical) (Detail)	May 31, 2016 $ / shares
2026 Senior Notes
Earnings Per Share Disclosure [Line Items]
Convertible notes conversion rate, per share	$ 47.15

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Approach to Calculate Diluted Earning Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net earnings attributable to Greenbrier		$ 35,352	$ 42,811	$ 149,653	$ 125,948
Earnings before interest and debt issuance costs on convertible notes		$ 36,085	$ 44,045	$ 151,615	$ 130,014
Weighted average diluted common shares outstanding		32,342	33,000	32,475	33,262
Diluted earnings per share	[1]	$ 1.12	$ 1.33	$ 4.67	$ 3.91
2018 Senior Notes
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Interest and debt issuance costs on the 2018 Convertible notes, net of tax		$ 733	$ 1,234	$ 1,962	$ 4,066

[1] Diluted earnings per share was calculated as follows: Earnings before interest and debt issuance costs (net of tax) on convertible notes Weighted average diluted common shares outstanding

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Stock Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 8,300	$ 6,000	$ 19,055	$ 13,176

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Derivative Instruments - Additional Information (Detail)	9 Months Ended
	May 31, 2016 USD ($)
Foreign Exchange Contracts
Derivative [Line Items]
Aggregate derivative notional amount	$ 429,700,000
Interest rate swap contracts
Derivative [Line Items]
Aggregate derivative notional amount	$ 93,000,000
Maturity date	2020-03
Unrealized Pre-tax gain (loss) that would be reclassified to interest expense in the next 12 months	$ 1,400,000

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Fair Values of Derivative Instruments (Detail) - USD ($) $ in Thousands	May 31, 2016	Aug. 31, 2015
Designated as Hedging Instrument
Derivatives, Fair Value [Line Items]
Asset Derivatives	$ 3,640	$ 1,820
Designated as Hedging Instrument | Accounts Payable and Accrued Liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	8,839	3,130
Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Receivable, Net
Derivatives, Fair Value [Line Items]
Asset Derivatives	3,640	1,820
Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Payable and Accrued Liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	5,402	737
Designated as Hedging Instrument | Interest rate swap contracts | Accounts Payable and Accrued Liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	3,437	2,393
Not Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Receivable, Net
Derivatives, Fair Value [Line Items]
Asset Derivatives		93
Not Designated as Hedging Instrument | Foreign Exchange Contracts | Accounts Payable and Accrued Liabilities
Derivatives, Fair Value [Line Items]
Liability Derivatives	$ 190	$ 76

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Effect of Derivative Instruments on Statements of Income (Detail) - Cash Flow Hedging - USD ($) $ in Thousands	9 Months Ended
	May 31, 2016	May 31, 2015
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in income on derivatives	$ (157)	$ 47
Gain (loss) recognized in OCI on derivatives (effective portion)	(8,623)	(773)
Gain (loss) Reclassified from Accumulated OCI into Income (Effective Portion)	(2,450)	(831)
Gain (loss) Recognized on Derivative (Ineffective portion and Amount Excluded from Effectiveness Testing)	2,660	1,024
Foreign Exchange Forward
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in OCI on derivatives (effective portion)	(5,430)	1,867
Foreign Exchange Forward | Interest and Foreign Exchange
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in income on derivatives	(245)	(22)
Foreign Exchange Forward | Sales
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) Reclassified from Accumulated OCI into Income (Effective Portion)	(835)	518
Gain (loss) Recognized on Derivative (Ineffective portion and Amount Excluded from Effectiveness Testing)	2,572	1,024
Foreign Exchange Forward | Cost Of Revenue
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in OCI on derivatives (effective portion)	(919)
Gain (loss) Reclassified from Accumulated OCI into Income (Effective Portion)	(412)
Gain (loss) Recognized on Derivative (Ineffective portion and Amount Excluded from Effectiveness Testing)	88
Interest rate swap contracts
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in OCI on derivatives (effective portion)	(2,274)	(2,640)
Interest rate swap contracts | Interest and Foreign Exchange
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) recognized in income on derivatives	88	69
Gain (loss) Reclassified from Accumulated OCI into Income (Effective Portion)	$ (1,203)	$ (1,349)

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Segment Information - Additional Information (Detail)	9 Months Ended
	May 31, 2016 Segment
Segment Reporting Information [Line Items]
Number of reportable segments	4

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Segments Internal Financial Reports (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015	Aug. 31, 2015
Segment Reporting Information [Line Items]
Revenues	$ 612,866	$ 714,606	$ 2,084,334	$ 1,839,813
Earnings (loss) from operations	84,129	104,411	325,007	251,365
Assets	1,785,884		1,785,884		$ 1,790,512
Manufacturing
Segment Reporting Information [Line Items]
Revenues	458,494	593,376	1,611,686	1,478,566
Earnings (loss) from operations	92,713	115,675	325,215	258,602
Wheels & Parts
Segment Reporting Information [Line Items]
Revenues	78,417	97,407	247,604	286,671
Earnings (loss) from operations	5,811	5,078	15,720	20,986
Leasing & Services
Segment Reporting Information [Line Items]
Revenues	75,955	23,823	225,044	74,576
Earnings (loss) from operations	8,298	10,824	42,668	31,677
Operating Segments | Manufacturing
Segment Reporting Information [Line Items]
Revenues	464,089	593,409	1,617,281	1,486,100
Earnings (loss) from operations	93,636	115,675	326,156	259,397
Assets	641,090		641,090		675,409
Operating Segments | Wheels & Parts
Segment Reporting Information [Line Items]
Revenues	88,475	105,012	271,678	307,121
Earnings (loss) from operations	6,522	5,685	17,875	23,030
Assets	301,474		301,474		291,798
Operating Segments | Leasing & Services
Segment Reporting Information [Line Items]
Revenues	76,556	35,545	235,488	118,109
Earnings (loss) from operations	8,899	22,546	53,112	75,210
Assets	523,989		523,989		549,073
Operating Segments | Unallocated Amount to Segment
Segment Reporting Information [Line Items]
Assets	319,331		319,331		$ 274,232
Corporate, Non-Segment
Segment Reporting Information [Line Items]
Earnings (loss) from operations	(22,693)	(27,166)	(58,596)	(59,900)
Intersegment Eliminations
Segment Reporting Information [Line Items]
Revenues	(16,254)	(19,360)	(40,113)	(71,517)
Earnings (loss) from operations	(2,235)	(12,329)	(13,540)	(46,372)
Intersegment Eliminations | Manufacturing
Segment Reporting Information [Line Items]
Revenues	5,595	(33)	5,595	(7,534)
Earnings (loss) from operations	923		941	(795)
Intersegment Eliminations | Wheels & Parts
Segment Reporting Information [Line Items]
Revenues	10,058	(7,605)	24,074	(20,450)
Earnings (loss) from operations	711	(607)	2,155	(2,044)
Intersegment Eliminations | Leasing & Services
Segment Reporting Information [Line Items]
Revenues	601	(11,722)	10,444	(43,533)
Earnings (loss) from operations	$ 601	$ (11,722)	$ 10,444	$ (43,533)

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Reconciliation of Segment Margin to Earnings Before Income Tax and Earnings from Unconsolidated Affiliates (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Segment Reporting, Other Significant Reconciling Item [Line Items]
Earnings from operations	$ 84,129	$ 104,411	$ 325,007	$ 251,365
Interest and foreign exchange	3,712	4,285	10,565	9,355
Earnings before income tax and earnings from unconsolidated affiliates	$ 80,417	$ 100,126	$ 314,442	$ 242,010

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Results of Operations for GBW Joint Venture (Detail) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015	Aug. 31, 2015
Segment Reporting Information [Line Items]
Revenue		$ 612,866	$ 714,606	$ 2,084,334	$ 1,839,813
Earnings (loss) from operations		84,129	104,411	325,007	251,365
Assets		1,785,884		1,785,884		$ 1,790,512
GBW Railcar Services Holdings, LLC
Segment Reporting Information [Line Items]
Revenue		95,699	88,831	289,381	254,688
Earnings (loss) from operations		3,030	227	9,065	(1,507)
Assets	[1]	$ 255,400	$ 239,871	$ 255,400	$ 239,871

[1] Includes goodwill and intangible assets of $94.4 million and $96.9 million as of May 31, 2016 and August 31, 2015.

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Results of Operations for GBW Joint Venture (Parenthetical) (Detail) - USD ($) $ in Millions	May 31, 2016	Aug. 31, 2015
GBW Railcar Services Holdings, LLC
Segment Reporting Information [Line Items]
Goodwill and intangible assets	$ 94.4	$ 96.9

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Commitments and Contingencies - Additional Information (Detail)		9 Months Ended	168 Months Ended
	Jun. 08, 2016 USD ($) Segment	May 31, 2016 USD ($)	Dec. 31, 2014 USD ($)
Commitments and Contingencies Disclosure [Line Items]
Remedial investigation and feasibility study			$ 110,000,000
Bank and third party warranty and performance guarantee facilities		$ 3,200,000
Equity method investment, percentage of ownership interest		50.00%
Payment to acquire equity method investments		$ 5,300,000
Expected loan to unconsolidated joint venture		3,750,000
Note receivable		35,200,000
Loan to unconsolidated joint venture		1,250,000
Mexican Railcar Manufacturing Joint Venture Credit Facility
Commitments and Contingencies Disclosure [Line Items]
Debt outstanding		900,000
Guarantee obligations		400,000
Performance Guarantee
Commitments and Contingencies Disclosure [Line Items]
Letter of credit facility outstanding amount		$ 81,300,000
GBW Railcar Services Holdings, LLC
Commitments and Contingencies Disclosure [Line Items]
Equity method investment, percentage of ownership interest		50.00%
Subsequent Event | Portland Harbor Site
Commitments and Contingencies Disclosure [Line Items]
Discount rate	7.00%
Subsequent Event | Portland Harbor Site | Minimum
Commitments and Contingencies Disclosure [Line Items]
Period for remedial action	4 years
Undiscounted costs for remedial alternatives	$ 642,000,000
Net present value of remedial alternatives	$ 451,000,000
Subsequent Event | Portland Harbor Site | Maximum
Commitments and Contingencies Disclosure [Line Items]
Period for remedial action	62 years
Undiscounted costs for remedial alternatives	$ 10,200,000,000
Net present value of remedial alternatives	$ 9,400,000,000
Subsequent Event | Area Of Willamette River Adjacent to the Company's Portland, Oregon Manufacturing Facility
Commitments and Contingencies Disclosure [Line Items]
Period for remedial action	7 years
Number of sediment decision units | Segment	13
Period for monitoring	30 years
Subsequent Event | Area Of Willamette River Adjacent to the Company's Portland, Oregon Manufacturing Facility | Minimum
Commitments and Contingencies Disclosure [Line Items]
Undiscounted costs for remedial alternatives	$ 1,100,000,000
Net present value of remedial alternatives	$ 746,000,000
Accuracy of cost estimate	(30.00%)
Subsequent Event | Area Of Willamette River Adjacent to the Company's Portland, Oregon Manufacturing Facility | Maximum
Commitments and Contingencies Disclosure [Line Items]
Undiscounted costs for remedial alternatives	$ 1,200,000,000
Net present value of remedial alternatives	$ 811,000,000
Accuracy of cost estimate	50.00%

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Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	May 31, 2016		Aug. 31, 2015
Assets:
Nonqualified savings plan investments	$ 15,093		$ 11,815
Fair Value, Measurements, Recurring
Assets:
Derivative financial instruments	3,640		1,913
Nonqualified savings plan investments	15,093		11,815
Cash equivalents	5,076		5,071
Assets, Fair Value Disclosure, Total	23,809		18,799
Liabilities:
Derivative financial instruments	9,029		3,206
Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring
Assets:
Nonqualified savings plan investments	15,093		11,815
Cash equivalents	5,076		5,071
Assets, Fair Value Disclosure, Total	20,169		16,886
Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring
Assets:
Derivative financial instruments	3,640	[1]	1,913
Assets, Fair Value Disclosure, Total	3,640	[1]	1,913
Liabilities:
Derivative financial instruments	$ 9,029	[1]	$ 3,206

[1] Level 2 assets and liabilities include derivative financial instruments that are valued based on observable inputs. See Note 11 Derivative Instruments for further discussion.

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Related Party Transactions - Additional Information (Detail) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Sep. 30, 2015 USD ($) Vehicle	May 31, 2016 USD ($) Vehicle	May 31, 2015 USD ($)	May 31, 2016 USD ($) Vehicle	May 31, 2015 USD ($)	Apr. 30, 2010 USD ($) Vehicle
Related Party Transaction [Line Items]
Number of railcars sold and recognized | Vehicle		2,766		2,766
Revenue		$ 612,866	$ 714,606	$ 2,084,334	$ 1,839,813
Sale of railcars				$ 162,000
Number of railcars sold | Vehicle		3,159		3,159
Deferred revenue on railcars sold				$ 7,800
Deferred revenue, number of railcars sold | Vehicle		389		389
Percentage of rate of return the company is entitled to receive after recoup of total investment				25.00%
Percentage of profit sharing after defined levels have been met				100.00%
WL Ross & Co., LLC (WL Ross)
Related Party Transaction [Line Items]
Number of related party railcars purchased | Vehicle	3,885					4,000
Value of railcars	$ 148,000					$ 256,000
Related party fee	$ 1,000
Revenue				$ 154,200
Profit sharing agreement, amount paid		$ 7,200		7,200
Accrued profit sharing		$ 11,300		$ 11,300

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Guarantor/Non Guarantor - Additional Information (Detail)	9 Months Ended
	May 31, 2016
Guarantor Obligations [Line Items]
Percentage of ownership in subsidiaries	100.00%

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Condensed Consolidating Balance Sheet (Detail) - USD ($) $ in Thousands	May 31, 2016	Aug. 31, 2015	May 31, 2015	Aug. 31, 2014
Assets
Cash and cash equivalents	$ 214,440	$ 172,930	$ 122,783	$ 184,916
Restricted cash	8,669	8,869
Accounts receivable, net	213,510	196,029
Inventories	458,068	445,535
Leased railcars for syndication	136,812	212,534
Equipment on operating leases, net	232,791	255,391
Property, plant and equipment, net	318,010	303,135
Investment in unconsolidated affiliates	89,297	87,270
Intangibles and other assets, net	71,022	65,554
Goodwill	43,265	43,265
Total assets	1,785,884	1,790,512
Liabilities and Equity
Revolving notes		50,888
Accounts payable and accrued liabilities	370,652	455,213
Deferred income taxes	50,390	60,657
Deferred revenue	68,158	33,836
Notes payable	306,808	326,429
Total equity - Greenbrier	840,086	732,838
Noncontrolling interest	149,790	130,651
Total equity	989,876	863,489	783,004	573,721
Liabilities and Equity	1,785,884	1,790,512
Parent
Assets
Cash and cash equivalents	55,717	53,535	55,896	149,747
Accounts receivable, net	3,736	49,471
Property, plant and equipment, net	9,139	8,402
Investment in unconsolidated affiliates	1,367,146	1,209,698
Intangibles and other assets, net	21,185	15,895
Total assets	1,456,923	1,337,001
Liabilities and Equity
Revolving notes		49,000
Accounts payable and accrued liabilities	449,757	421,249
Deferred income taxes	14,415
Deferred revenue	32,732
Notes payable	119,933	133,914
Total equity - Greenbrier	840,086	732,838
Total equity	840,086	732,838
Liabilities and Equity	1,456,923	1,337,001
Combined Guarantor Subsidiaries
Assets
Cash and cash equivalents	1,263	119	487	112
Restricted cash	1,765	1,966
Accounts receivable, net	585,797	535,916
Inventories	272,481	191,625
Leased railcars for syndication	139,827	228,646
Equipment on operating leases, net	232,900	255,130
Property, plant and equipment, net	104,302	102,738
Investment in unconsolidated affiliates	198,977	169,659
Intangibles and other assets, net	44,083	46,387
Goodwill	43,265	43,265
Total assets	1,624,660	1,575,451
Liabilities and Equity
Accounts payable and accrued liabilities	223,954	282,662
Deferred income taxes	54,090	72,326
Deferred revenue	30,870	33,792
Notes payable	186,000	191,422
Total equity - Greenbrier	1,129,746	995,249
Total equity	1,129,746	995,249
Liabilities and Equity	1,624,660	1,575,451
Combined Non-Guarantor Subsidiaries
Assets
Cash and cash equivalents	157,460	119,276	$ 66,400	$ 35,057
Restricted cash	6,904	6,903
Accounts receivable, net	49,529	24,415
Inventories	198,455	257,619
Equipment on operating leases, net	2,709	2,901
Property, plant and equipment, net	204,569	191,995
Investment in unconsolidated affiliates	21,056	21,369
Intangibles and other assets, net	14,036	14,235
Total assets	654,718	638,713
Liabilities and Equity
Revolving notes		1,888
Accounts payable and accrued liabilities	170,823	208,538
Deferred revenue	281
Notes payable	875	1,093
Total equity - Greenbrier	332,880	296,852
Noncontrolling interest	149,859	130,342
Total equity	482,739	427,194
Liabilities and Equity	654,718	638,713
Eliminations
Assets
Accounts receivable, net	(425,552)	(413,773)
Inventories	(12,868)	(3,709)
Leased railcars for syndication	(3,015)	(16,112)
Equipment on operating leases, net	(2,818)	(2,640)
Investment in unconsolidated affiliates	(1,497,882)	(1,313,456)
Intangibles and other assets, net	(8,282)	(10,963)
Total assets	(1,950,417)	(1,760,653)
Liabilities and Equity
Accounts payable and accrued liabilities	(473,882)	(457,236)
Deferred income taxes	(18,115)	(11,669)
Deferred revenue	4,275	44
Total equity - Greenbrier	(1,462,626)	(1,292,101)
Noncontrolling interest	(69)	309
Total equity	(1,462,695)	(1,291,792)
Liabilities and Equity	$ (1,950,417)	$ (1,760,653)

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Condensed Consolidating Statement of Income (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Revenue
Revenue	$ 612,866	$ 714,606	$ 2,084,334	$ 1,839,813
Cost of revenue
Cost of revenue	485,768	565,320	1,652,580	1,477,149
Margin	127,098	149,286	431,754	362,664
Selling and administrative expense	43,280	45,595	118,073	112,223
Net (gain) loss on disposition of equipment	(311)	(720)	(11,326)	(924)
Earnings from operations	84,129	104,411	325,007	251,365
Other costs
Interest and foreign exchange	3,712	4,285	10,565	9,355
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates	80,417	100,126	314,442	242,010
Income tax (expense) benefit	(22,449)	(30,783)	(92,902)	(76,209)
Earnings (loss) before earnings (loss) from unconsolidated affiliates	57,968	69,343	221,540	165,801
Earnings (loss) from unconsolidated affiliates	1,564	982	2,921	1,552
Net earnings (loss)	59,532	70,325	224,461	167,353
Net (earnings) loss attributable to noncontrolling interest	(24,180)	(27,514)	(74,808)	(41,405)
Net earnings (loss) attributable to Greenbrier	35,352	42,811	149,653	125,948
Manufacturing
Revenue
Revenue	458,494	593,376	1,611,686	1,478,566
Cost of revenue
Cost of revenue	352,775	465,658	1,247,635	1,184,922
Earnings from operations	92,713	115,675	325,215	258,602
Wheels & Parts
Revenue
Revenue	78,417	97,407	247,604	286,671
Cost of revenue
Cost of revenue	69,818	89,645	224,208	259,285
Earnings from operations	5,811	5,078	15,720	20,986
Leasing & Services
Revenue
Revenue	75,955	23,823	225,044	74,576
Cost of revenue
Cost of revenue	63,175	10,017	180,737	32,942
Earnings from operations	8,298	10,824	42,668	31,677
Parent
Revenue
Revenue	239	(90)	3,346	83
Cost of revenue
Margin	239	(90)	3,346	83
Selling and administrative expense	22,933	24,851	56,825	55,116
Earnings from operations	(22,694)	(24,941)	(53,479)	(55,033)
Other costs
Interest and foreign exchange	2,069	3,240	8,409	9,345
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates	(24,763)	(28,181)	(61,888)	(64,378)
Income tax (expense) benefit	1,460	4,215	(2,063)	(4,476)
Earnings (loss) before earnings (loss) from unconsolidated affiliates	(23,303)	(23,966)	(63,951)	(68,854)
Earnings (loss) from unconsolidated affiliates	58,655	66,777	213,604	194,802
Net earnings (loss)	35,352	42,811	149,653	125,948
Net earnings (loss) attributable to Greenbrier	35,352	42,811	149,653	125,948
Parent | Manufacturing
Revenue
Revenue	(1,055)		1,992
Parent | Leasing & Services
Revenue
Revenue	1,294	(90)	1,354	83
Combined Guarantor Subsidiaries
Revenue
Revenue	392,573	403,436	1,339,283	1,242,386
Cost of revenue
Cost of revenue	353,505	331,315	1,155,202	1,032,183
Margin	39,068	72,121	184,081	210,203
Selling and administrative expense	10,672	10,688	30,517	26,905
Net (gain) loss on disposition of equipment	(308)	(724)	(10,950)	(927)
Earnings from operations	28,704	62,157	164,514	184,225
Other costs
Interest and foreign exchange	1,910	1,649	5,182	4,998
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates	26,794	60,508	159,332	179,227
Income tax (expense) benefit	(7,556)	(26,025)	(52,706)	(62,438)
Earnings (loss) before earnings (loss) from unconsolidated affiliates	19,238	34,483	106,626	116,789
Earnings (loss) from unconsolidated affiliates	15,452	5,142	29,558	21,377
Net earnings (loss)	34,690	39,625	136,184	138,166
Net earnings (loss) attributable to Greenbrier	34,690	39,625	136,184	138,166
Combined Guarantor Subsidiaries | Manufacturing
Revenue
Revenue	235,613	280,928	862,856	877,405
Cost of revenue
Cost of revenue	216,829	230,143	745,419	735,414
Combined Guarantor Subsidiaries | Wheels & Parts
Revenue
Revenue	82,292	98,746	252,744	290,917
Cost of revenue
Cost of revenue	73,475	91,131	228,969	263,755
Combined Guarantor Subsidiaries | Leasing & Services
Revenue
Revenue	74,668	23,762	223,683	74,064
Cost of revenue
Cost of revenue	63,201	10,041	180,814	33,014
Combined Non-Guarantor Subsidiaries
Revenue
Revenue	419,441	492,302	1,336,227	1,285,604
Cost of revenue
Cost of revenue	334,498	418,273	1,089,603	1,091,498
Margin	84,943	74,029	246,624	194,106
Selling and administrative expense	9,494	9,912	30,216	30,169
Net (gain) loss on disposition of equipment	254	7	256	7
Earnings from operations	75,195	64,110	216,152	163,930
Other costs
Interest and foreign exchange	(83)	(604)	(2,556)	(4,988)
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates	75,278	64,714	218,708	168,918
Income tax (expense) benefit	(15,244)	(7,888)	(38,171)	(22,559)
Earnings (loss) before earnings (loss) from unconsolidated affiliates	60,034	56,826	180,537	146,359
Earnings (loss) from unconsolidated affiliates	348	47	(16)	142
Net earnings (loss)	60,382	56,873	180,521	146,501
Net (earnings) loss attributable to noncontrolling interest	(22,579)	(26,415)	(76,023)	(61,992)
Net earnings (loss) attributable to Greenbrier	37,803	30,458	104,498	84,509
Combined Non-Guarantor Subsidiaries | Manufacturing
Revenue
Revenue	419,441	492,302	1,336,226	1,285,603
Cost of revenue
Cost of revenue	334,498	418,273	1,089,603	1,091,498
Combined Non-Guarantor Subsidiaries | Leasing & Services
Revenue
Revenue			1	1
Eliminations
Revenue
Revenue	(199,387)	(181,042)	(594,522)	(688,260)
Cost of revenue
Cost of revenue	(202,235)	(184,268)	(592,225)	(646,532)
Margin	2,848	3,226	(2,297)	(41,728)
Selling and administrative expense	181	144	515	33
Net (gain) loss on disposition of equipment	(257)	(3)	(632)	(4)
Earnings from operations	2,924	3,085	(2,180)	(41,757)
Other costs
Interest and foreign exchange	(184)		(470)
Earnings (loss) before income taxes and earnings (loss) from unconsolidated affiliates	3,108	3,085	(1,710)	(41,757)
Income tax (expense) benefit	(1,109)	(1,085)	38	13,264
Earnings (loss) before earnings (loss) from unconsolidated affiliates	1,999	2,000	(1,672)	(28,493)
Earnings (loss) from unconsolidated affiliates	(72,891)	(70,984)	(240,225)	(214,769)
Net earnings (loss)	(70,892)	(68,984)	(241,897)	(243,262)
Net (earnings) loss attributable to noncontrolling interest	(1,601)	(1,099)	1,215	20,587
Net earnings (loss) attributable to Greenbrier	(72,493)	(70,083)	(240,682)	(222,675)
Eliminations | Manufacturing
Revenue
Revenue	(195,505)	(179,854)	(589,388)	(684,442)
Cost of revenue
Cost of revenue	(198,552)	(182,758)	(587,387)	(641,990)
Eliminations | Wheels & Parts
Revenue
Revenue	(3,875)	(1,339)	(5,140)	(4,246)
Cost of revenue
Cost of revenue	(3,657)	(1,486)	(4,761)	(4,470)
Eliminations | Leasing & Services
Revenue
Revenue	(7)	151	6	428
Cost of revenue
Cost of revenue	$ (26)	$ (24)	$ (77)	$ (72)

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Condensed Consolidating Statement of Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Condensed Statement of Income Captions [Line Items]
Net earnings (loss)		$ 59,532	$ 70,325	$ 224,461	$ 167,353
Other comprehensive income (loss)
Translation adjustment		1,477	(1,299)	(3,655)	(10,990)
Reclassification of derivative financial instruments recognized in net earnings (loss)	[1]	659	(254)	1,710	417
Unrealized gain (loss) on derivative financial instruments	[2]	1,113	107	(6,417)	(7)
Other (net of tax effect)		7	93	1	99
Other comprehensive income (loss)		3,256	(1,353)	(8,361)	(10,481)
Comprehensive income (loss)		62,788	68,972	216,100	156,872
Comprehensive (income) loss attributable to noncontrolling interest		(24,195)	(27,497)	(74,761)	(41,253)
Comprehensive income (loss) attributable to Greenbrier		38,593	41,475	141,339	115,619
Parent
Condensed Statement of Income Captions [Line Items]
Net earnings (loss)		35,352	42,811	149,653	125,948
Other comprehensive income (loss)
Translation adjustment				1,527
Unrealized gain (loss) on derivative financial instruments		5		(23)
Other comprehensive income (loss)		5		1,504
Comprehensive income (loss)		35,357	42,811	151,157	125,948
Comprehensive income (loss) attributable to Greenbrier		35,357	42,811	151,157	125,948
Combined Guarantor Subsidiaries
Condensed Statement of Income Captions [Line Items]
Net earnings (loss)		34,690	39,625	136,184	138,166
Other comprehensive income (loss)
Translation adjustment			(18)		(137)
Reclassification of derivative financial instruments recognized in net earnings (loss)		230	275	746	837
Unrealized gain (loss) on derivative financial instruments		3	(443)	(1,409)	(1,640)
Other comprehensive income (loss)		233	(186)	(663)	(940)
Comprehensive income (loss)		34,923	39,439	135,521	137,226
Comprehensive income (loss) attributable to Greenbrier		34,923	39,439	135,521	137,226
Combined Non-Guarantor Subsidiaries
Condensed Statement of Income Captions [Line Items]
Net earnings (loss)		60,382	56,873	180,521	146,501
Other comprehensive income (loss)
Translation adjustment		1,477	(1,281)	(3,655)	(10,853)
Reclassification of derivative financial instruments recognized in net earnings (loss)		429	(529)	964	(420)
Unrealized gain (loss) on derivative financial instruments		1,105	550	(4,985)	1,633
Other (net of tax effect)		7	93	1	99
Other comprehensive income (loss)		3,018	(1,167)	(7,675)	(9,541)
Comprehensive income (loss)		63,400	55,706	172,846	136,960
Comprehensive (income) loss attributable to noncontrolling interest		(22,594)	(26,398)	(75,976)	(61,840)
Comprehensive income (loss) attributable to Greenbrier		40,806	29,308	96,870	75,120
Eliminations
Condensed Statement of Income Captions [Line Items]
Net earnings (loss)		(70,892)	(68,984)	(241,897)	(243,262)
Other comprehensive income (loss)
Translation adjustment				(1,527)
Other comprehensive income (loss)				(1,527)
Comprehensive income (loss)		(70,892)	(68,984)	(243,424)	(243,262)
Comprehensive (income) loss attributable to noncontrolling interest		(1,601)	(1,099)	1,215	20,587
Comprehensive income (loss) attributable to Greenbrier		$ (72,493)	$ (70,083)	$ (242,209)	$ (222,675)

[1] Net of tax effect of $0.3 million and $0.04 million for the three months ended May 31, 2016 and 2015 and $0.7 million and $0.4 million for the nine months ended May 31, 2016 and 2015.

[2] Net of tax effect of $0.3 million and $0.1 million for the three months ended May 31, 2016 and 2015 and $2.2 million and $0.6 million for the nine months ended May 31, 2016 and 2015.

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Condensed Consolidating Statement of Cash Flows (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	May 31, 2016	May 31, 2015	May 31, 2016	May 31, 2015
Cash flows from operating activities:
Net earnings (loss)	$ 59,532	$ 70,325	$ 224,461	$ 167,353
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes			(10,143)	(5,245)
Depreciation and amortization			41,681	33,258
Net (gain) loss on disposition of equipment	(311)	(720)	(11,326)	(924)
Stock based compensation expense	8,300	6,000	19,055	13,176
Noncontrolling interest adjustments			837	20,371
Other			564	1,008
Decrease (increase) in assets:
Accounts receivable, net			(14,333)	(8,769)
Inventories			(15,346)	(124,906)
Leased railcars for syndication			28,823	(90,914)
Other			(5,191)	(1,666)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities			(88,707)	23,135
Deferred revenue			24,303	3,680
Net cash provided by (used in) operating activities			194,678	29,557
Cash flows from investing activities:
Proceeds from sales of assets			88,707	4,628
Capital expenditures			(51,707)	(75,892)
Decrease (increase) in restricted cash			200	228
Investment in and net advances to unconsolidated affiliates			(9,088)	(29,923)
Cash distribution from unconsolidated affiliates			5,338	715
Net cash provided by (used in) investing activities			33,450	(100,244)
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less			(49,000)	73,000
Proceeds from revolving notes with maturities longer than 90 days				42,563
Repayments of revolving notes with maturities longer than 90 days			(1,888)	(36,137)
Repayments of notes payable			(19,461)	(5,504)
Debt issuance costs			(4,160)
Repurchase of stock			(33,498)	(48,451)
Dividends			(17,362)	(12,069)
Decrease in restricted cash				11,000
Cash contribution to joint venture partner			(62,710)	(12,489)
Investment by joint venture partner			5,400
Excess tax benefit from restricted stock awards			2,786	2,964
Other			(7)
Other			(7)	(248)
Net cash provided by (used in) financing activities			(179,900)	14,629
Effect of exchange rate changes			(6,718)	(6,075)
Increase (decrease) in cash and cash equivalents			41,510	(62,133)
Beginning of period			172,930	184,916
End of period	214,440	122,783	214,440	122,783
Parent
Cash flows from operating activities:
Net earnings (loss)	35,352	42,811	149,653	125,948
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes			15,000	(138)
Depreciation and amortization			2,059	1,484
Stock based compensation expense			19,055	13,176
Other				43
Decrease (increase) in assets:
Accounts receivable, net			45,735	50
Other			(1,715)	20,641
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities			(48,102)	(3,824)
Deferred revenue			32,732	(122)
Net cash provided by (used in) operating activities			214,417	157,258
Cash flows from investing activities:
Capital expenditures			(2,796)	(2,424)
Investment in and net advances to unconsolidated affiliates			(176,356)	(245,594)
Cash distribution from unconsolidated affiliates			5,338	715
Net cash provided by (used in) investing activities			(173,814)	(247,303)
Cash flows from financing activities:
Net changes in revolving notes with maturities of 90 days or less			(49,000)	73,000
Repayments of notes payable			(13,981)	(5)
Debt issuance costs			(4,160)
Intercompany advances			75,289	(18,997)
Repurchase of stock			(33,498)	(48,451)
Dividends			(17,362)	(12,069)
Excess tax benefit from restricted stock awards			2,786	2,964
Other				(248)
Net cash provided by (used in) financing activities			(39,926)	(3,806)
Effect of exchange rate changes			1,505
Increase (decrease) in cash and cash equivalents			2,182	(93,851)
Beginning of period			53,535	149,747
End of period	55,717	55,896	55,717	55,896
Combined Guarantor Subsidiaries
Cash flows from operating activities:
Net earnings (loss)	34,690	39,625	136,184	138,166
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes			(18,235)	(8,000)
Depreciation and amortization			23,314	19,909
Net (gain) loss on disposition of equipment	(308)	(724)	(10,950)	(927)
Other			(32)	105
Decrease (increase) in assets:
Accounts receivable, net			27,389	(10,046)
Inventories			(82,518)	(39,279)
Leased railcars for syndication			36,802	(109,324)
Other			(1,666)	763
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities			(59,664)	25,612
Deferred revenue			(8,710)	4,078
Net cash provided by (used in) operating activities			41,914	21,057
Cash flows from investing activities:
Proceeds from sales of assets			88,697	4,623
Capital expenditures			(18,480)	(18,807)
Decrease (increase) in restricted cash			201	229
Investment in and net advances to unconsolidated affiliates			(26,977)	(19,966)
Net cash provided by (used in) investing activities			43,441	(33,921)
Cash flows from financing activities:
Repayments of notes payable			(5,261)	(5,280)
Intercompany advances			(77,270)	9,788
Decrease in restricted cash				11,000
Net cash provided by (used in) financing activities			(82,531)	15,508
Effect of exchange rate changes			(1,680)	(2,269)
Increase (decrease) in cash and cash equivalents			1,144	375
Beginning of period			119	112
End of period	1,263	487	1,263	487
Combined Non-Guarantor Subsidiaries
Cash flows from operating activities:
Net earnings (loss)	60,382	56,873	180,521	146,501
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes			2,219	2,893
Depreciation and amortization			16,385	11,936
Net (gain) loss on disposition of equipment	254	7	256	7
Other			596	860
Decrease (increase) in assets:
Accounts receivable, net			(27,697)	37,034
Inventories			58,013	(87,156)
Other			(64,522)	(33,634)
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities			(34,987)	9,112
Deferred revenue			281	(276)
Net cash provided by (used in) operating activities			131,065	87,277
Cash flows from investing activities:
Proceeds from sales of assets			10	5
Capital expenditures			(30,431)	(55,059)
Decrease (increase) in restricted cash			(1)	(1)
Net cash provided by (used in) investing activities			(30,422)	(55,055)
Cash flows from financing activities:
Proceeds from revolving notes with maturities longer than 90 days				42,563
Repayments of revolving notes with maturities longer than 90 days			(1,888)	(36,137)
Repayments of notes payable			(219)	(219)
Intercompany advances			1,981	9,209
Cash contribution to joint venture partner			(62,710)	(12,489)
Investment by joint venture partner			5,400
Other			(7)
Net cash provided by (used in) financing activities			(57,443)	2,927
Effect of exchange rate changes			(5,016)	(3,806)
Increase (decrease) in cash and cash equivalents			38,184	31,343
Beginning of period			119,276	35,057
End of period	157,460	66,400	157,460	66,400
Eliminations
Cash flows from operating activities:
Net earnings (loss)	(70,892)	(68,984)	(241,897)	(243,262)
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Deferred income taxes			(9,127)
Depreciation and amortization			(77)	(71)
Net (gain) loss on disposition of equipment	$ (257)	$ (3)	(632)	(4)
Noncontrolling interest adjustments			837	20,371
Decrease (increase) in assets:
Accounts receivable, net			(59,760)	(35,807)
Inventories			9,159	1,529
Leased railcars for syndication			(7,979)	18,410
Other			62,712	10,564
Increase (decrease) in liabilities:
Accounts payable and accrued liabilities			54,046	(7,765)
Net cash provided by (used in) operating activities			(192,718)	(236,035)
Cash flows from investing activities:
Capital expenditures				398
Investment in and net advances to unconsolidated affiliates			194,245	235,637
Net cash provided by (used in) investing activities			194,245	$ 236,035
Cash flows from financing activities:
Effect of exchange rate changes			$ (1,527)