Note 19 - Segment Information

The Company operates in three reportable segments: Manufacturing; Wheels, Repair & Parts; and Leasing & Services. Prior to August 20, 2018, the Company operated in four reportable segments: Manufacturing; Wheels & Parts; Leasing & Services; and GBW Joint Venture. On August 20, 2018 the Company entered into an agreement with its joint venture partner to discontinue the GBW railcar repair joint venture, which resulted in 12 repair shops returned to the Company. Beginning on August 20, 2018, the GBW Joint Venture was no longer considered a reportable segment.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies. 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 year ended August 31, 2018:


	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	2,044,586	$	118,157		$	2,162,743		$	240,901		$	17,721		$	258,622
Wheels, Repair & Parts		347,023		41,494			388,517			16,731			2,748			19,479
Leasing & Services		127,855		11,847			139,702			88,481			10,296			98,777
Eliminations		–		(171,498	)		(171,498	)		–			(30,765	)		(30,765	)
Corporate		–		–			–			(93,128	)		–			(93,128	)

	$	2,519,464	$	–		$	2,519,464		$	252,985		$	–		$	252,985

For the year ended August 31, 2017:


	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	1,725,188	$	19,291		$	1,744,479		$	295,334		$	1,022		$	296,356
Wheels, Repair & Parts		312,679		30,861			343,540			14,984			2,303			17,287
Leasing & Services		131,297		11,812			143,109			31,904			11,099			43,003
Eliminations		–		(61,964	)		(61,964	)		–			(14,424	)		(14,424	)
Corporate		–		–			–			(81,790	)		–			(81,790	)

	$	2,169,164	$	–		$	2,169,164		$	260,432		$	–		$	260,432

For the year ended August 31, 2016:


	Revenue								Earnings (loss) from operations
	External		Intersegment			Total			External			Intersegment			Total
Manufacturing	$	2,096,331	$	89,158		$	2,185,489		$	415,094		$	24,299		$	439,393
Wheels, Repair & Parts		322,395		32,436			354,831			19,948			2,602			22,550
Leasing & Services		260,798		13,101			273,899			51,723			13,101			64,824
Eliminations		–		(134,695	)		(134,695	)		–			(40,002	)		(40,002	)
Corporate		–		–			–			(78,213	)		–			(78,213	)

	$	2,679,524	$	–		$	2,679,524		$	408,552		$	–		$	408,552


	Years ended August 31,
(In thousands)	2018		2017		2016
Assets:
Manufacturing	$	1,020,757	$	914,450	$	701,296
Wheels, Repair & Parts		306,756		236,315		275,599
Leasing & Services		578,818		535,323		516,147
Unallocated		559,133		711,617		342,732

	$	2,465,464	$	2,397,705	$	1,835,774

Depreciation and amortization:
Manufacturing	$	44,225	$	33,807	$	27,137
Wheels, Repair & Parts		10,771		11,143		11,971
Leasing & Services		19,360		20,179		24,237

	$	74,356	$	65,129	$	63,345

Capital expenditures:
Manufacturing	$	59,707	$	54,973	$	51,294
Wheels, Repair & Parts		5,204		3,129		10,190
Leasing & Services		111,937		27,963		77,529

	$	176,848	$	86,065	$	139,013

The following table summarizes selected geographic information.


	Years ended August 31,
(In thousands)	2018		2017		2016
Revenue ⁽¹⁾:
U.S.	$	1,840,877	$	1,674,517	$	2,297,501
Foreign		678,587		494,647		382,023

	$	2,519,464	$	2,169,164	$	2,679,524

Assets:
U.S.	$	1,677,144	$	1,307,239	$	955,674
Mexico		517,543		791,974		788,878
Europe		270,777		298,492		91,222

	$	2,465,464	$	2,397,705	$	1,835,774

⁽¹⁾	Revenue is presented on the basis of geographic location of customers.

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


	Years ended August 31,
(In thousands)	2018		2017		2016
Earnings from operations	$	252,985	$	260,432	$	408,552
Interest and foreign exchange		29,368		24,192		13,502

Earnings before income tax and earnings (loss) from unconsolidated affiliates	$	223,617	$	236,240	$	395,050

The Company has a 50% ownership interest in the GBW Joint Venture and accounts for its interest under the equity method of accounting. The Company’s 50% share of the results of operations are included in Earnings (loss) from unconsolidated affiliates in the Consolidated Statement of Income and its investment is included in Investments in unconsolidated affiliates in the Consolidated Balance Sheet. The GBW Joint Venture was Greenbrier’s fourth reportable segment until August 20, 2018. Information for 2018, 2017 and 2016 is included in the tables below which represent totals for GBW rather than Greenbrier’s 50% share, as this is how performance and resource allocation was previously evaluated.


	Years ended August 31,
(In thousands)	2018			2017			2016
GBW Joint Venture:
Revenue	$	238,033		$	253,436		$	373,490
Earnings (loss) from operations	$	(46,783	)	$	(32,454	)	$	8,558
Assets	$	8,531		$	206,009		$	247,610
Depreciation and amortization	$	8,932		$	9,023		$	7,676
Capital expenditures	$	8,514		$	8,030		$	16,110