Segment Information

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segment Information

Segment Information

We report our operating results in two reportable segments: (1) the Railcar Leasing and Management Services Group, which owns and operates a fleet of railcars and provides third-party fleet leasing, management, and administrative services, as well as other railcar logistics products and services; and (2) the Rail Products Group, which manufactures and sells railcars and related parts and components, and provides railcar maintenance and modification services.

Gains and losses from the sale of property, plant, and equipment are included in the operating profit of each respective segment. Our Chief Operating Decision Maker ("CODM") regularly reviews the operating results of our reportable segments in order to assess performance and allocate resources. Our CODM does not consider restructuring activities when evaluating segment operating results; therefore, restructuring activities are not allocated to segment profit or loss.

Sales and related net profits ("deferred profit") from the Rail Products Group to the Leasing Group are recorded in the Rail Products Group and eliminated in consolidation and are reflected in "Eliminations – Lease Subsidiary" in the tables below. Sales between these groups are recorded at prices comparable to those charged to external customers, taking into consideration quantity, features, and production demand. Amortization of deferred profit on railcars sold to the Leasing Group is included in the operating profit of the Leasing Group, resulting in the recognition of depreciation expense based on our original manufacturing cost of the railcars. Lease portfolio sales are included in the Leasing Group, with related gains and losses computed based on the net book value of the original manufacturing cost of the railcars.

The financial information for these segments is shown in the tables below (in millions). We operate principally in North America.

	Three Months Ended September 30, 2023
	Railcar Leasing and Management Services Group		Rail Products Group		Eliminations – Lease Subsidiary		Eliminations – Other		Consolidated Total
External revenue	$	222.3	$	599.0	$	—	$	—	$	821.3
Intersegment revenue	0.3		83.2		(83.2)		(0.3)		—
Total revenues	$	222.6	$	682.2	$	(83.2)	$	(0.3)	$	821.3

	Three Months Ended September 30, 2022
	Railcar Leasing and Management Services Group		Rail Products Group		Eliminations – Lease Subsidiary		Eliminations – Other		Consolidated Total
External revenue	$	194.6	$	302.0	$	—	$	—	$	496.6
Intersegment revenue	0.2		295.3		(295.3)		(0.2)		—
Total revenues	$	194.8	$	597.3	$	(295.3)	$	(0.2)	$	496.6

	Nine Months Ended September 30, 2023
	Railcar Leasing and Management Services Group		Rail Products Group		Eliminations – Lease Subsidiary		Eliminations – Other		Consolidated Total
External revenue	$	648.6	$	1,536.8	$	—	$	—	$	2,185.4
Intersegment revenue	0.7		492.2		(492.2)		(0.7)		—
Total revenues	$	649.3	$	2,029.0	$	(492.2)	$	(0.7)	$	2,185.4

	Nine Months Ended September 30, 2022
	Railcar Leasing and Management Services Group		Rail Products Group		Eliminations – Lease Subsidiary		Eliminations – Other		Consolidated Total
External revenue	$	572.6	$	813.5	$	—	$	—	$	1,386.1
Intersegment revenue	0.6		605.5		(605.5)		(0.6)		—
Total revenues	$	573.2	$	1,419.0	$	(605.5)	$	(0.6)	$	1,386.1

The reconciliation of segment operating profit to consolidated net income is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(in millions)
Operating profit:
Railcar Leasing and Management Services Group	$	88.6	$	107.9	$	292.6	$	293.2
Rail Products Group	39.2		26.0		88.2		40.5
Segment Totals	127.8		133.9		380.8		333.7
Corporate and other	(25.2)		(21.4)		(82.8)		(62.2)
Restructuring activities, net	—		—		2.2		(1.0)
Eliminations – Lease Subsidiary	(2.4)		(19.6)		(32.3)		(48.7)
Eliminations – Other	—		(0.2)		0.4		(1.3)
Consolidated operating profit	100.2		92.7		268.3		220.5
Other (income) expense	67.9		54.4		199.8		147.0
Provision (benefit) for income taxes	6.0		8.6		1.9		17.4
Loss from discontinued operations, net of income taxes	(2.7)		(3.4)		(8.1)		(13.7)
Loss on sale of discontinued operations, net of income taxes	—		—		—		(5.7)
Net income	$	23.6	$	26.3	$	58.5	$	36.7