Good day, and welcome to the Trinity Industries Q1 ended 31 March, 2024 results conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press *, then 1 on a touch-tone phone. To withdraw your question, please press *, then 2. Please note, this event is being recorded. Before we get started, let me remind you that today's conference call contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, and includes statements as to estimates, expectations, intentions, and predictions of future financial performance. Statements that are not historical fact are forward-looking. Participants are directed to Trinity's Form 10-K and other SEC filings for a description of certain of the business issues and risks, a change in any of which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. I would now like to turn the conference over to Leigh Anne Mann, Vice President of Investor Relations. Please go ahead. Thank you, operator. Good morning, everyone. We appreciate you joining us for the company's Q1 2024 financial results conference call. Our prepared remarks will include comments from Jean Savage, Trinity's Chief Executive Officer and President, and Eric Marchetto, the company's Chief Financial Officer. We will hold a Q&A session following the prepared remarks from our leaders. During the call today, we will reference certain non-GAAP financial metrics. The reconciliations of the non-GAAP metrics to comparable GAAP measures are provided in the appendix of the supplemental slides, which are accessible on our investor relations website at www.trin.net. These slides are under the Events and Presentations portion of the website, along with the Q1 earnings conference call event link. A replay of today's call will be available after 10:30AM Eastern Time through midnight on 8 May, 2024. Replay information is available under the Events and Presentations page on our investor relations website. It is now my pleasure to turn the call over to Jean. Thank you, Leigh Anne, and good morning, everyone. We started 2024 off strong, and I am pleased with Trinity's progress. Our Q1 revenue was up 26% year-over-year, and we carried more of that revenue to the bottom line. We continued to reprice more of our fleet upward and had a Q1 future lease rate differential, or FLRD, of 34.7%, the second highest mark for the FLRD since Trinity began reporting this metric 4 years ago. Furthermore, we achieved significant margin improvement in our rail products business. In summary, our Q1 GAAP EPS of $0.33 represents momentum starting to flow through our business and demonstrates the strength of our platform. This start to the year gives us confidence to raise our full-year EPS guidance to a range of $1.35 to 1.55, reflecting higher revenue, margin improvement, and consistent performance. Before we talk about our segments and financial results, I'd like to briefly update on what we are seeing in the market. Service levels continue to improve in the industry, allowing shippers to be more efficient in their supply chains. Dwell times are also improving and well below historical averages, allowing quicker turnarounds. We're optimistic that these service metrics will continue in the near term, making rail a more competitive mode of transport. Overall, fleet storage rates also remain low. In terms of end markets, since last quarter, we have seen significant improvement in chemicals. Additionally, despite high levels of inflation and high borrowing costs, automotive demand has remained strong, driven by continued demand for SUVs and the recovery in auto parts supply chain following the supply chain challenges of the past few years. We continue to view this cycle differently with a more diversified railcar demand. This is encouraging to Trinity as a lessor, as stabilized production levels support a balanced lease fleet, allowing for high utilization and competitive lease rates. Now let's talk about our performance at the segment level. As mentioned on our year-end call, effective 1 January, we modified our organizational structure to better leverage our maintenance services capabilities to support lease fleet optimization and to grow our services and parts businesses. Today's results are presented in this new format. As part of this modification, we aligned our maintenance services business, which was previously part of our rail product segment, to now be presented within our leasing and services segment. The leasing and services segment, which includes leasing and management, maintenance services, and digital and logistics services, had a strong quarter with fleet utilization of 97.5%, renewal rates up 30% over expiring rates, and as I said at the top of the call, an FLRD of +34.7%. Lease rates are substantially higher across nearly all railcar types. Our revenue and margin, excluding lease portfolio sales, are up year-over-year in this segment, driven by higher external maintenance work, improved lease rates, and net additions to the lease fleet. Revenue from maintenance services is up 122% year-over-year. Digital and logistics services revenue is up 25% year-over-year, benefited by the acquisition of RSI and continued growth in these businesses in support of our lease fleet. Giving you a few more details about this business, our average lease rates are up $49 compared to a year ago, and we have now repriced about 41% of our fleet in the last 2 years, representing when the FLRD turned double-digit positive. While our renewal success rate of 65% was lower than usual in the quarter, this was specific to certain end markets and, in some cases, a strategic decision. Put another way, the current supply-driven strength enables us as a lessor to make the optimal lease decision for long-term returns on the asset. We expect our utilization to remain consistent as we continue to renew railcars and assign non-renewing railcars into other services, often at better returns. Our Q1 net investment in our lease fleet was $123 million, which includes new railcar additions, betterments, and secondary market purchases of $148 million, and $24 million in proceeds from lease portfolio sales. Moving to our rail product segment, which includes our manufacturing business and parts and components businesses, we continue to see significant improvement in the operating margin. Higher revenue in the quarter reflects higher deliveries, and our operating margin of 6.6% highlights the improvements we've made in our operational and labor efficiencies. We are seeing improvement in rail service and supply chain, and our team is doing a great job mitigating issues. Our Q1 performance reflects that dedication. Trinity's Q1 order volume of 1,880 railcars continues to support our views on replacement-driven demand, and we still expect the industry to deliver about 40,000 railcars in 2024. We have seen an encouraging uptick in order inquiries to further support our view of replacement-level demand. Our railcar deliveries were 4,695 and included virtually all of the railcars that were impacted by the border closure at the end of last year. We also completed 675 railcar conversions in the quarter. Our new railcar backlog remains healthy at $2.9 billion. Before I turn the call to Eric, I want to remind you of two important dates. First, our annual shareholder meeting will take place Monday, 20 May, at 8:30AM Central Time. Second, make sure your calendars are marked for 25 June. We look forward to hosting you in Texas at our 2024 Investor Day and providing a longer-term view of our business. Reach out to Leigh Anne if you have any questions about the event. I'll now turn to Eric to discuss the financial statements and update our views on the rest of the year. Thank you, Jean, and good morning, everyone. I'll start my comments on the income statement. Total revenues of $810 million, up 26% as compared to a year ago, reflect higher external railcar deliveries, improved lease rates, and a higher volume of external repairs. Lease portfolio sales were modest in the quarter, and we recorded a gain of $2.1 million. Both quarterly GAAP and adjusted EPS were $0.33 in the quarter, with adjusted EPS reflecting a $0.26 improvement from a year ago. Q1 favorable segment margin performance was driven by strong lease rates, with higher external deliveries and improved efficiency in rail manufacturing. We are seeing the benefits of our platform and are excited by the progress. Moving to the cash flow statement, our cash flow from continuing operations was $57 million, and our adjusted free cash flow after investments and dividends was $12 million. Cash from operations was impacted by higher receivables balances, partially offset by lower inventory balances as we delivered railcars that were placed in storage in the Q4. We returned $23 million to our shareholders in the quarter through our quarterly dividend payment. Net fleet investment in the quarter was $123 million. Our last 12 months pre-tax ROE was 16.2%, representing the mid-teen goal we set at our 2020 Investor Day. In March, we entered into a new warehouse loan facility with a total commitment amount of $800 million. This replaces the prior $1 billion warehouse loan facility. We rightsized the warehouse facility, given our fleet investment expectations. There is more information on our new warehouse in the 10-Q, which we expect to file later today. As we look forward in 2024, we are confident we'll deliver strong results. Given a great start to the year and our confidence in the durability of these improved margins, we are raising our full-year EPS guidance by $0.05, to a range of $1.35 to 1.55. We believe this target is attainable and see a lot of momentum in our business to support our elevated guidance. We expect a full-year Rail Products Group operating margin of 6% to 8%. We are pleased to start the year in this range and expect to continue to improve as the year progresses.... We anticipate a full year net investment in our lease fleet of between $300 and $400 million, and expect secondary market railcar activity in the Q2. As Jean said, we like the progress we are making as a company and the fundamentals of the operating environment. We continue to believe our leasing business will benefit from the products and services supporting it. We look forward to discussing our long-term views with you at our Investor Day here in Dallas on 25 June. Operator, we are now ready to take our first question. We will now begin the question-and-answer session. To ask a question, you may press *, then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press * then 2. At this time, we will pause momentarily to assemble our roster. The first question comes from Justin Long with Stephens. Please go ahead. Thanks, and good morning. Morning. So maybe to start with a couple questions on the numbers going forward. Eric, I think you talked last quarter about the impact from railcar sales maybe being around half of what it was in 2023, as you think about the full year. Any change to that forecast? And, you know, on rail products, our rail product group margins, you know, the guidance didn't change, but any color you can provide on the cadence of margins as we think about the next few quarters? Yeah. I'll start and Jean can talk about the rail group. Justin, thanks for your question. At a high level and a short answer, no, we really haven't changed anything. As you saw in the Q1, on car sales activity, it was very modest, just a $2 billion gain. And that really, our guidance of half the gains from 2023 and 2024 still holds. We do expect that our activity will pick up in the Q2, and we do expect activity to be kind of throughout the year. As far as rail products, you know, the hard work that the team has been doing over the last several quarters, finally starting to show. When you look at that, our supply chain has gone out and captured more of the value for us. And when you look at the efficiencies, they've come quicker with the longer-tenured employees than what we had expected there. And we expect these to continue throughout the year. But you know, we don't give quarterly guidance on that, so we're keeping the range of 6% to 8%, and that range is for the entire year. Okay, fair enough, and it was encouraging to see that improvement in margins. I guess on the other side of the coin, just based on the commentary on inquiry levels that you provided last quarter, it sounded like we were starting to see a pickup when you reported in late February. Orders got a little bit better sequentially, but you didn't see as much of an improvement as, you know, I anticipated. So I'm just curious if there's anything going on as it relates to just converting inquiries to orders and, you know, how you're thinking about order flow in the quarters ahead. Can we get back to an environment where the backlog is improving sequentially? So remember, Justin, that we had, in Q3 of 2022, a very large multi-year order. So when you have those big orders come in, sometimes quarter to quarter following that, you don't see quite as large a number happening. We still have just under half the industry backlog sitting on our books, and when you look at the inquiry levels, they continue to improve even this quarter. And, if you look at the orders we received in the quarter, we're still within our normal range. So it's still at that replacement level demand that we keep talking about, that we see those orders coming in, and I think the industry backlog supports that. Okay, got it. Thank you for the time. Thank you. The next question comes from Bascome Majors with Susquehanna. Please go ahead. Yeah, thanks for taking my questions. And to follow up on Justin's last question, can you talk a little bit about where you're seeing improved inquiry levels and if you've seen a greater conversion of that? Because, you know, I do understand and appreciate the backlog, but, you know, the last six months for the industry being at roughly half replacement rate in orders, it does give us a little bit of pause on you know, whether this production pace can sustain into 2025. Thank you. Sure, and thanks for the question, Bascome. If you look at it, one thing that is very encouraging to us is we're starting to see, tank car orders creep up, and that goes along with the chemicals and the alternative, fuels markets. And the second half of the year, we see those coming into play more. As you know, this started out as a freight car-led, recovery, so that's great from the standpoint of typically, tank cars have higher margins than freight cars. The other thing that I'm going to say on this is, Q1, there were 9,000 cars scrapped. If you say we have the same number for the rest of the year, that's 36,000 cars that would be scrapped. Over the last five years, especially 2020 and 2021, there were over 50,000 cars scrapped. So there's still a lot of room to make up for the numbers of cars scrapped versus built over the last four or five years, and inquiry levels that we're seeing still support that, you know, replacement level demand for us and for others. On the production plan, can you talk a little bit about, you know, how you feel about the cadence in your productivity and whether it should be fairly steady throughout the next couple of quarters based on the visibility you have today, or if there'll be some ups and downs? Thank you. Okay, thanks, Bascome. You know, it's never always linear, so I'm going to start with that. But based off the fact that our turnover has reduced, so the tenure of our employees continues to go up. With that tenure, we see efficiency improvements. We expect that to persist throughout the year. We are filling out some orders at the end of the year, but overall, we're very confident in our ability to continue to improve our overall performance. And lastly, you know, I know it's already come up, but I'd love to drill in a little bit more on the gains on sale piece. I mean, that was a meaningful headwind to the full year profit outlook when you rolled that out in February, and it sounds like you're sticking with that. Can you just talk a little bit about maybe qualitatively rather than quantitatively, and what you're seeing in the secondary markets? It does feel like that's still quite healthy. Just anything about the depth of deals when you put things out there in the marketplace, you know, your conviction that you will be able to extend or find a new primary partner and sort of, you know, if there's any strategy change to how you've done that over the last four or five years as we look to the next two or three? Thank you. Sure, Bascome. Yeah, first, I'll just reiterate, you know, when you look at our increase in guidance, that was all because of the operating margins in the business. We did not change any outlook on gains on sales, so that's just an improvement in our outlook overall. Our assumptions on the car sales side and the gains are still holding up. And why it's different, there's a few things why it's different. One, you know, we're originating a little bit less than we have historically. We're about 25% of our deliveries of our manufactured deliveries are going to go to the lease fleet. That's a little bit less. And as you recall, on the last call, I referenced that a lot of our planned lease fleet additions were in the back half of the year, in the Q4 of the year. So in terms of assuming that we're going to transact those additions, it just is not a good assumption. So that's, that's why we're holding it there. When you look at the overall secondary market, we're encouraged. We see breadth and depth. We're seeing lessors, independent lessors. A lot of their fleet growth is coming from secondary market adds. We're not seeing a lot of speculative adds into the backlog. They're shifting more and buying secondary market transactions. So that's probably a healthier indication for the market. That may have a small impact on backlogs and order activity that we're seeing on the new car side, but overall, I think that's a good thing, as they're looking to buy, you know, known deals rather than speculate. When you look at, the other thing that's driving us, is the lease originations that we're doing, we like the yield on those assets, and they're, you know, we, we continue to raise our hurdle rates, in the face of changes in interest rates, but we like the yield. And so, you know, the $300 to 400 million of net fleet additions this year, we feel good about that from a return standpoint. Thank you for the time. Yep. Thank you. As a reminder, if you have a question, please press *, then 1 to be joined into the question queue. The next question comes from Steve Barger with KeyBanc Capital Markets. Please go ahead. Thanks. Good morning. Good morning. Not to dwell on the past two quarters, I know it can be lumpy, but the industry did average 5,000 per quarter, so I'm just curious about contingency plans. If this is the run rate that we were to see, you know, in the back half or for the next year, would you focus on price discipline and returns, even if that meant lower share, or do you optimize for share to keep lines as utilized as you can in 2025? So we have switched to a discipline model on the orders that we're taking. I don't see that changing. We continue to look at orders and say we've got to make a profit on those. And so as we move forward, I would expect that to stay. And if you look at the last few quarters, we've been in our normal range of orders, based off the industry, the 30% to 40%, even with that discipline. So we don't plan to change that. But remember, we're talking about approximately 40,000 cars for the industry, and this cycle is much more muted than any cycle that you've seen in the past. So you have lower highs and higher floors, going into the cycle, and very tight band, so it's not causing a lot of disruption overall in manufacturing. Understood. Yep, thanks. And slide eight says LTV is about 66%. You have the $369 million of unencumbered cars. Is that the LTV you expect to maintain at end of year? And given the net fleet investment for the rest of the year, will those cars be encumbered this year, or how do you think about, you know, utilizing that lever? Yeah, good question, Steve. The tick up in LTV this quarter was, I mentioned in my prepared remarks that we redid our warehouse. We ended up improving our advance rate on those assets, and so that's why it ticked up this quarter. So that was good. You know, we like having a little bit unencumbered. You know, I've not really managed the unencumbered as much as managing the overall leverage. Our long-term target is still at 60% to 65%. We do have our investor day coming up in June. We'll revisit that and give longer term views, but you know, for right now, I would hold to that 60% to 65%, but it went up because of the warehouse refinancing. Yep, got it. Thank you. Yep. This concludes our question and answer session. I would like to turn the conference back over to Jean Savage for any closing remarks. Well, thank you for joining us today. As you hopefully heard in our voices, we're excited about 2024 and believe Trinity is off to a great start to reach our targets and to continue to improve. We look forward to sharing our progress with you and hope to see a lot of you on 25 June. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.