Railcar Leasing and Management Services Group (Tables)

9 Months Ended

Sep. 30, 2015

Sale Leaseback Transaction [Line Items]

Selected consolidating financial information for the Leasing Group

Selected consolidating financial information for the Leasing Group is as follows:



	September 30, 2015
	Leasing Group
	Wholly- Owned Subsidiaries		Partially-Owned Subsidiaries		Manufacturing/ Corporate			Total
	(in millions)
Cash, cash equivalents, and short-term marketable securities	$	2.5	$	—	$	675.3		$	677.8
Property, plant, and equipment, net	$	3,064.3	$	1,952.5	$	933.7		$	5,950.5
Net deferred profit on railcars sold to the Leasing Group								(642.1		)
Consolidated property, plant and equipment, net								$	5,308.4
Restricted cash	$	121.3	$	90.5	$	—		$	211.8
Debt:
Recourse	$	36.6	$	—	$	850.0		$	886.6
Less: unamortized discount	—		—		(48.3		)	(48.3		)
	36.6		—		801.7			838.3
Non-recourse	982.1		1,464.1		—			2,446.2
Total debt	$	1,018.7	$	1,464.1	$	801.7		$	3,284.5
Net deferred tax liabilities	$	656.7	$	0.9	$	(8.0	)	$	649.6



	December 31, 2014
	Leasing Group
	Wholly- Owned Subsidiaries		Partially-Owned Subsidiaries		Manufacturing/ Corporate			Total
	(in millions)
Cash, cash equivalents, and short-term marketable securities	$	11.9	$	—	$	951.0		$	962.9
Property, plant, and equipment, net	$	2,599.2	$	1,999.9	$	861.0		$	5,460.1
Net deferred profit on railcars sold to the Leasing Group								(557.2		)
Consolidated property, plant and equipment, net								$	4,902.9
Restricted cash	$	142.8	$	91.9	$	—		$	234.7
Debt:
Recourse	$	39.1	$	—	$	850.2		$	889.3
Less: unamortized discount	—		—		(60.0		)	(60.0		)
	39.1		—		790.2			829.3
Non-recourse	1,207.8		1,515.9		—			2,723.7
Total debt	$	1,246.9	$	1,515.9	$	790.2		$	3,553.0
Net deferred tax liabilities	$	658.2	$	0.9	$	(44.1	)	$	615.0

Selected consolidating income statement information for the Leasing Group



	Three Months Ended September 30,								Nine Months Ended September 30,
	2015			2014			Percent		2015			2014			Percent
	($ in millions)						Change		($ in millions)						Change
Revenues:
Leasing and management	$	176.6		$	158.3		11.6	%	$	520.9		$	469.2		11.0	%
Sales of railcars owned one year or less at the time of sale	72.6			47.4			*		211.2			411.1			*
Total revenues	$	249.2		$	205.7		21.1		$	732.1		$	880.3		(16.8	)

Operating profit:
Leasing and management	$	81.8		$	74.4		9.9		$	254.7		$	213.8		19.1
Railcar sales:
Railcars owned one year or less at the time of sale	18.6			9.6					61.2			115.7
Railcars owned more than one year at the time of sale	57.8			3.0					102.8			90.2
Total operating profit	$	158.2		$	87.0		81.8		$	418.7		$	419.7		(0.2	)

Operating profit margin:
Leasing and management	46.3		%	47.0		%			48.9		%	45.6		%
Railcar sales	*			*					*			*
Total operating profit margin	63.5		%	42.3		%			57.2		%	47.7		%

Selected expense information⁽¹⁾:
Depreciation	$	35.9		$	32.4		10.8		$	105.8		$	97.1		9.0
Maintenance	$	24.6		$	17.8		38.2		$	65.9		$	58.8		12.1
Rent	$	9.9		$	13.1		(24.4	)	$	31.3		$	39.7		(21.2	)
Interest	$	32.5		$	39.1		(16.9	)	$	106.8		$	114.5		(6.7	)

* Not meaningful

⁽¹⁾Depreciation, maintenance, and rent expense are components of operating profit. Amortization of deferred profit on railcars sold from the Rail Group to the Leasing Group is included in the operating profit of the Leasing Group resulting in the recognition of depreciation expense based on the Company's original manufacturing cost of the railcars. Interest expense is not a component of operating profit and includes the effect of hedges.

Proceeds from the sale of leased railcars to Element

During the nine months ended September 30, 2015 and 2014, the Company received proceeds from the sale of leased railcars to Element Financial Corporation ("Element") under the strategic alliance with Element announced in December 2013 as follows:



	Nine Months Ended September 30,
	2015		2014
	(in millions)
Leasing Group:
Railcars owned one year or less at the time of sale	$	182.7	$	378.8
Railcars owned more than one year at the time of sale	258.0		235.7
Rail Group	175.8		153.4
	$	616.5	$	767.9

Future contractual minimum rental revenues on leases

Future contractual minimum rental revenues on leases are as follows:



	Remaining three months of 2015		2016		2017		2018		2019		Thereafter		Total
	(in millions)
Future contractual minimum rental revenue	$	137.1	$	486.2	$	412.0	$	327.9	$	242.9	$	410.1	$	2,016.2

Railcars leased from independent owner trusts

Sale Leaseback Transaction [Line Items]

Future operating lease obligations and future contractual minimum rental revenues, Leasing group

Future operating lease obligations of the Leasing Group’s subsidiaries as well as future contractual minimum rental revenues related to these leases due to the Leasing Group are as follows:



	Remaining three months of 2015		2016		2017		2018		2019		Thereafter		Total
	(in millions)
Future operating lease obligations of Trusts’ railcars	$	7.4	$	29.3	$	29.2	$	29.2	$	28.8	$	170.2	$	294.1
Future contractual minimum rental revenues of Trusts’ railcars	$	13.2	$	47.4	$	38.9	$	29.2	$	20.1	$	35.0	$	183.8

Railcars leased from other third parties

Sale Leaseback Transaction [Line Items]

Future operating lease obligations and future contractual minimum rental revenues, Leasing group

Future amounts due as well as future contractual minimum rental revenues related to operating leases other than leases discussed above are as follows:



	Remaining three months of 2015		2016		2017		2018		2019		Thereafter		Total
	(in millions)
Future operating lease obligations	$	3.2	$	12.8	$	12.1	$	12.0	$	9.5	$	28.7	$	78.3
Future contractual minimum rental revenues	$	5.3	$	19.3	$	12.4	$	7.2	$	3.8	$	5.9	$	53.9