Segment Information

3 Months Ended

Nov. 30, 2016

Segment Information

Note 11 – 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 (loss) 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 2016 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 November 30, 2016:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	454,033	$	—		$	454,033		$	83,341		$	—		$	83,341
Wheels & Parts		69,635		7,201			76,836			2,894			612			3,506
Leasing & Services		28,646		5,334			33,980			7,390			5,250			12,640
Eliminations		—		(12,535	)		(12,535	)		—			(5,862	)		(5,862	)
Corporate		—		—			—			(20,965	)		—			(20,965	)
	$	552,314	$	—		$	552,314		$	72,660		$	—		$	72,660

For the three months ended November 30, 2015:

	Revenue								Earnings (loss) from operations
(In thousands)	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	698,661	$	—		$	698,661		$	153,704		$	—		$	153,704
Wheels & Parts		78,729		6,816			85,545			3,403			684			4,087
Leasing & Services		24,999		6,709			31,708			9,958			6,709			16,667
Eliminations		—		(13,525	)		(13,525	)		—			(7,393	)		(7,393	)
Corporate		—		—			—			(18,580	)		—			(18,580	)
	$	802,389	$	—		$	802,389		$	148,485		$	—		$	148,485

	Total assets
	November 30,		August 31,
(In thousands)	2016		2016
Manufacturing	$	729,361	$	701,296
Wheels & Parts		279,971		275,599
Leasing & Services		471,957		516,147
Unallocated		336,061		342,732
	$	1,817,350	$	1,835,774

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

	Three Months Ended November 30,
(In thousands)	2016		2015
Earnings from operations	$	72,660	$	148,485
Interest and foreign exchange		1,724		5,436
Earnings before income tax and earnings (loss) from unconsolidated affiliates	$	70,936	$	143,049

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 November 30, 2016 and August 31, 2016 and for the three months ended November 30, 2016 and 2015 are included in the tables below.

	Three Months Ended November 30,
(In thousands)	2016			2015
Revenue	$	70,253		$	95,982
Earnings (loss) from operations	$	(4,561	)	$	2,408
	Total Assets
	November 30, 2016			August 31, 2016
GBW (1)	$	238,303		$	247,610

⁽¹⁾  Includes goodwill and intangible assets of $92.5 million and $93.4 million as of November 30, 2016 and August 31, 2016.