Good morning, and welcome to the Triton International Limited First Quarter 2022 Earnings Conference Call. All participants will be in 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'll be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to John Burns, CFO. Please go ahead. Thank you, Anthony. Good morning, and thank you for joining us on today's call. We are here to discuss Triton's first quarter 2022 results, which were reported this morning. Joining me on this morning's call from Triton is Brian Sondey, our CEO, and John O'Callaghan, our Global Head of Field Marketing and Operations. Before I turn the call over to Brian, I'd like to note that our prepared remarks will follow along a presentation that can be found in the Investors section of our website under Investor Presentations. I'd like to direct you to slide two of that presentation and remind you that today's presentation includes forward-looking statements that reflect Triton's current view with respect to future events, financial performance, and industry conditions. These forward-looking statements are subject to various risks and uncertainties. Triton has provided additional information in its reports on file with the SEC concerning factors that could cause actual results to differ materially from those contained in this presentation, and we encourage you to review these factors. In addition, reconciliations of non-GAAP measures to the most directly comparable GAAP financial measures are included in our earnings release and in the presentation. With these formalities out of the way, I'll now turn the call over to Brian. Thanks, John, and welcome to Triton International's first quarter 2022 earnings conference call. I'll start with slide three of our presentation. Triton achieved another quarter of record performance in the first quarter of 2022. We generated $2.76 of adjusted net income per share, an increase of 3.4% from the fourth quarter, and an increase of 45% from the first quarter of last year. We achieved an annualized return on equity of over 30%. Triton is carrying significant operational and financial strength into 2022. We have added over $4 billion of containers over the last two years and placed these containers onto high-margin, long-duration leases. We've extended lease durations across our fleet and increased the share of our dry containers on lifecycle leases to almost 60%. We have achieved meaningful interest expense savings through aggressive refinancing activity and locked in these savings by focusing on fixed rate, long-duration debt. Market conditions remain constructive. Goods consumption remains high, and our customers continue to face extensive operational disruptions that are slowing container turn times. Container prices and market leasing rates are down from last year's peak but remain historically high. Our customers have been more cautious about growing their container fleets so far this year after aggressively expanding last year, but drop-offs remain low, and a number of customers have been active leasing for spot requirements, and again, at lease rates that remain historically high. We continue to use our strong cash flow to drive shareholder value. We have repurchased 3.3 million shares, or about 5% of our total, since we shifted focus from aggressive fleet investment to share repurchases last fall. We are increasing our repurchase authorization back to $200 million, and we announced a quarterly dividend of $0.65 per share. We have made durable enhancements to our business that we believe have locked in a higher level of performance. We expect our adjusted net income per share will decrease slightly from the first to the second quarter as disposal prices and gains moderate. We also expect our profitability and return on equity to remain very high throughout 2022 and into the longer term. I will now hand the call over to John O'Callaghan, our Global Head of Marketing and Operations. Thank you, Brian. Turning to page four. Page four illustrates that goods consumption and logistical bottlenecks continue to drive container demand. The two charts on the left illustrate that consumption remains elevated in the U.S., and the ratio of retail inventories relative to sales remain at low levels. The charts on the right show that solid growth, trade growth is forecasted through 2022, which combined with the logistical issues, will continue to absorb capacity. As the shipping lines continue to struggle with disruptions, those disruptions have been exacerbated by what has been happening in the major port areas in China. There is potential for further disruption on the West Coast as congestion ping-pongs back and forth between Asia and the U.S. We are hearing from our customers that these bottlenecks will absorb a lot of capacity for some time and in an unpredictable way. Page five. Page five illustrates that freight rates and new and used container prices are down from the peaks of 2021, but still remain historically high. The chart to the left illustrates the Transpacific and East West spot freight rates relative to bunker costs. Freight rates also remain historically high due to continued demand for cargo, and while the logistical bottlenecks continue to absorb existing available capacity. You can see in the upper right chart that container prices have come down and are slightly below $3,000, in part due to the high volume produced through 2021 easing some of the shortage. Bottom right chart illustrate that the sale price of used containers has come down some in the first quarter but also remains historically high. Page six. Page six shows that the high container production in 2021 has eased container shortages, but overall availability remains tight. The chart on the left shows container production, and although there has been a reasonable amount of building in the first quarter, it is well below last year's pace. While we do not believe the shipping lines view containers as strategic investments, they have placed a larger percentage of what building we have seen in the first quarter of 2022. Chart on the right is container factory inventory and depot stocks. While we have seen the amount of available container factory inventory increase, as a percentage of the global fleet, it's actually lower than normal at 1.5%. The bottom right chart illustrates that there are next to no depot units available. Turning to page seven. Page seven shows that Triton's key operating metrics remain very strong. On the upper right chart, you can see the first quarter pickups are down from last year, while still net positive as we came through the traditional slow season. Drop-offs have been very low, which is keeping utilization at maximum levels. Even though utilization is coming off a little bit, it's still exceptionally high, and we remain well protected by our lifecycle leases and long-term portfolio illustrated in the bottom right chart. The lower left bubble chart shows the pace of activity as customers have slowed their absorption of containers through what is the seasonally slow period. Customers remain cautious about additional container capacity after adding a lot last year, but they also see a market where trade volumes are still strong, and they are still dealing with significant disruption due to continued logistical bottlenecks, so are not dropping off any containers either as they wait and see how the market develops. We are still seeing a strong backdrop for us with high container prices, multiple demand drivers for containers, very limited drop-off volumes, and we have, at the same time, locked in most of our equipment. I'll now hand you off to John Burns, our CFO. Thank you, John. On page eight, we have presented our consolidated financial results. Adjusted net income for the first quarter was $179.6 million or $2.76 per share, an increase of 3.4% from the fourth quarter and nearly 45% from the prior year's first quarter. These exceptional results represent an annualized return on equity of over 30%. On page nine, I'll discuss the drivers of our strong profitability. Our strong first quarter performance reflects the enhancements we have made to our business over the last two years. Our first quarter revenue was flat from the fourth quarter, despite two less revenue days, as we had a full quarter's benefit from the high volume of new containers on hire in the fourth quarter, and utilization remained at maximum levels. Revenue in the first quarter was up 20% over last year's first quarter. Revenue growth was less than asset growth, largely due to the growth in the finance lease portion of our fleet and the way finance lease revenue is recognized. We expect our utilization, revenue, and fleet size to remain at very high levels in the second quarter. We expect our first half fleet investment to be roughly at replacement levels and therefore our revenue earning assets to hold steady. Average utilization will likely moderate slightly in the second quarter, and we expect revenue to be up slightly due to one more billing day. Interest expense increased slightly in the first quarter, reflecting a full quarter increase in our average debt balance due to the funding of the asset growth in the fourth quarter. Our effective interest rate held steady at 2.5%, in line with the fourth quarter, but down 80 basis points from the first quarter of last year, reflecting the benefits of our active refinancing activity over the last two years. With over 87% of our debt portfolio being fixed rate debt or swapped to fixed with a weighted average duration of over five years, the recent increase in interest rates will have a limited impact on our overall effective interest rate going forward. We continue to generate exceptional levels of trading and disposal gains, totaling $33.1 million for the first quarter, down only slightly from the fourth quarter. We expect these gains to remain high in the second quarter, though we expect them to continue to trend lower as disposal prices decrease. Since the end of the peak season last year, we have shifted our strong cash flows from aggressive container investment toward active share repurchases. Over that period, we have repurchased 3.3 million shares, including 1.7 million shares repurchased so far this year. In support of this share repurchase activity, we have once again increased our share repurchase authorization back up to $200 million. Page 10 highlights the exceptional growth in our leasing margin and the profitability generated last year and in the first quarter of this year, and that these high level of earnings are durable. On the left, we show how we have leveraged the strong market conditions to rapidly expand our leasing margin. On the right, we show why this high level of performance is durable. The top right graph shows the increase in the average remaining lease duration for containers on long-term and finance leases. As you can see that the remaining lease duration increased over 60 months on a CEU basis. When we calculate this on a net book value basis, capturing the high cost and high revenue of containers purchased last year, the remaining lease duration jumps to 79 months. If we include the typical time it takes a customer to return or build down containers once the lease expires, this adds roughly a year to both figures. In addition to the long duration of our lease portfolio, the portion of the portfolio made up by these long-term leases has climbed to 88% from 82.5% at the end of 2020. On the bottom right, we show that we fund this long-term lease portfolio with long duration, fixed rate, or hedged to fixed rate debt at very attractive interest rate levels as a result of our refinancing activities over the last two years. We expect this combination of attractive long-term lease and debt portfolios will lock in a high level of leasing margins for years to come. I'll now return you to Brian for some additional comments. Thanks, John. Slide 11 summarizes the way we think about our equity cash flow and illustrates how this cash flow gives us a variety of powerful levers to drive shareholder value. The top grouping of numbers summarize the cash flow power of our business. We are currently generating over $1.6 billion of cash flow before capital spending on an annualized basis. Remember, the duration of these cash flows is substantial due to the strength of our long-term lease portfolio. We need to allocate a little more than half of this cash flow for replacement capital spending in order to maintain our fleet size as containers age out of service. This leaves us with around $715 million of steady-state cash flow. We currently pay a quarterly dividend of $0.65 per share, which represents about $170 million in annual dividends. As a result, we have about $545 million of steady-state cash flow after our substantial regular dividend. The next set of numbers illustrate a few things that we can do with this $545 million. If we focused on capital investment, we could self-fund the equity needed for nearly 20% asset growth while keeping our leverage ratio constant. Alternatively, if we focused on share repurchases, we could repurchase about 14% of our shares at their current trading range. If we wanted instead to focus on dividends, we could pay almost $8.50 per share on top of our regular dividend, bringing the total annual dividend to over $11 per share. We have typically pursued a mix of these options. Slide 12 looks at how Triton has created long-term value for shareholders. We have talked a lot recently about how Triton has achieved exceptional performance over the last two years, but Triton's strong performance stretches back a long time. Triton is the cost and capability leader in an attractive, defendable market niche, and we have a long history of delivering solid growth, strong profitability, and above market investment returns. The chart on the upper left looks at the long-term growth of our container fleet. Over the last 17 years, we have grown our fleet 8% per year on a CEU basis and 10% per year on the basis of net book value. The chart on the upper right looks at our long-term cash flow before capital spending. You can see how our cash flow has increased as we have grown our fleet. You can also see the stability of our cash flow. We generated strong cash flow even in very challenging years, like the 2009 global financial crisis and the 2015-2016 industrial and commodities recession. The chart on the lower left shows how we've used our strong cash flow to both reinvest in our business and regularly return cash to shareholders. An investor in TAL's 2005 IPO purchased a business with an adjusted net book value of around $12 per share. That investor today would have a business with an adjusted net book value of $44 per share, and they would have pocketed $30 per share in dividends along the way. As you can see in the lower right, that same investor would have earned an annualized return on investment of almost 14% per year, significantly outperforming the S&P 500. I'll finish the presentation with slide 13. Triton is off to a strong start in 2022, and we have high expectations for our business. We achieved another record quarter of profitability in the first quarter. We have made durable enhancements to our business and are carrying significant operational and financial strength. Market conditions remain constructive. We expect our profitability and return on equity to remain strong throughout 2022 and into the longer term. Our strong cash flow gives us powerful levers to drive shareholder value across a wide range of market environments. We will now open up the call for questions. We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. Our first question will come from Michael Brown with KBW. You may now go ahead. Great. Thank you, operator. Morning, everyone. Morning, Michael. Brian and John, I appreciate the comments on the bottlenecks and the challenges of the current operating environment. If we focus on the shutdown situation in China, what are your expectations or what are you hearing from customers in terms of when this could ease? Then given the uniqueness of the situations, once the shutdowns are done, how could trade play out from there? How will the catch-up in terms of goods produced and play out from here? How will it normalize based on what your expectations are today? Yeah. I think the first thing I'd say is it's just a very uncertain situation. You know that, of course, there's a lot of things that are just unknowable, you know, about how the COVID pandemic is gonna progress and how that's gonna impact, you know, certainly China right now and everywhere else. You know, I'd just say the main thing we hear from customers is that, you know, the bottlenecks that were really, you know, plaguing the shipping industry and I think the economy for, you know, most of 2021 are still there, you know. It's not just, you know, the ports in China or previously the ports in the West Coast. It's a whole, you know, layer of factors, you know, going from port productivity to, you know, trucking capacity, to warehousing efficiency, and now of course, you know, the shutdowns of some of the biggest ports in the world. You know, typically what we see when, you know, we see disruption is that, you know, the same amount of goods want to flow. When you see temporary disruptions, it means the peak periods when things are flowing well are higher. And that also tends to mean, yeah, shipping lines need more containers in their fleet, you know, relative to the cargo that they're moving. And that's what we're seeing and have seen for the last, you know, again, 18 months or so. you know, yeah, I don't think anyone really right now is brave enough to forecast just how it plays out. But certainly it's been and continues to be, you know, a big impact on the business. Okay. Yeah. That's certainly fair. I just wanted to ask about the secondary market and, you know, the gain on sale trends that you mentioned here. You talked about the fact that the gains are expected to tick down in the second quarter, at least as of what you know currently. Is this just a reflection of the limited containers that you have available for sale, or is this also an element of the gain on sale per container coming down more from here? Just trying to parse through what's kind of built into that expectation. Then if you know, I understand there's a lot of uncertainty here, but if you think about the coming quarters or the trajectory from here for the rest of the year, is it possible that as if turn-ins start to come in, that the volume that you're able to sell could rise and that you could actually experience a bit of growth in that line? Again, I know it's maybe a little further out in the year, but just curious how you think about that as we get, as we progress through the year. Yeah, sure. You know, we've been saying now for probably, I don't know, three or four quarters that, you know, our gain on sale and disposal prices have to come down. You know, really the main driver behind those comments is just that they're, you know, so extraordinarily high. You know, we have some charts in the presentation that look at used 20-foot and 40-foot high cube container prices over time. You can see that they reached really unprecedented levels in 2021, driven by the high cost of new containers and just the overall shortage of containers, you know, which choked off containers to the leasing and sale markets. What we're seeing, we are seeing price starting to come down, just because, you know, like we've seen many other, you know, freight rates and new container prices, you know, hit peak levels in 2021 and start to come off as the market, you know, just can't stay at that level forever. It's just it is a little hard to say, you know, what's the pace of the container prices coming down. We've seen some of it already. We expect to see it happen more. You know, but that said, we expect prices to remain very high. You're right, as volume increases, if we start to see more off-hires, some of which is pressuring price, that also does lead to higher volumes. Our volumes right now are historically very low. You know, we're not trying to give the impression that we're gonna toggle very quickly back to, you know, where sale gains had been in 2019, for example. We do think that we'll continue to see some decrease in sale prices following the decreases we've seen in new building prices and following just the, you know, kind of the easing of the extreme container shortage that we saw in 2021, even though containers still remain pretty tight. Great. Brian, I would just, if I could sneak in one more here on valuation. I was just taking a look at your historical PE multiple and, you know, just going back to 2020, for example, you know, your PE at that time was closer to the, you know, mid sevens. You know, it looks like 7.4, which I would argue is still probably a pretty low valuation multiple for your business. Then since then, the consensus estimates for 2022 are up over 60%. I mean, you're putting up ROEs north of 30%. You've structurally, you know, really changed and improved the business model and produced some really strong growth in the earning assets. Yet you're now trading at less than 6x. Understand that the macro landscape is certainly challenging. You know, as you think about your business here, could you just touch on, you know, how you're feeling about the outlook for Triton and the prospects for the business and maybe just touch on the valuation and then how you guys are thinking about that and what the market could be missing here. Yeah, sure. Obviously it's something we have taken note of and, you know, I'd like to think people that have spoken with us would know that's something that's been a source of, you know, frustration for us and appreciate that it's a source of frustration for our investors. Yeah, you're right. I mean, we trade at a very low PE multiple right now despite what we think is a, you know, a very strong business right now, and a business that's created a tremendous amount of value consistently over time. You know, as to why we trade, you know, where we do in terms of, you know, our multiple, that's a question I think more for you and for the market. You know, we've been trying to communicate the structural improvements that we've made to our business through our lease portfolio and refinancing activity, the shift that's occurred over the last, you know, really five or seven years that has, you know, boosted our relative strength through our merger and really created significant capability and cost gaps between us and our competitors, as well as just the structural things that have improved in the industry around credit and the real focus on leasing for most of our customers. You know, we look out to the future, and we've tried to be pretty clear, you know, in our commentary here and in prior meetings that we believe this, you know, we've really jumped to a new level of profitability going forward, because of, you know, not permanent, but the very long duration improvements that we've been able to make in our business, over the last two years. Hopefully the market will start to see that. You know, we've built out a lot of our investor materials to show, you know, especially like at our Investor Day, you know, the runoff value of our lease portfolio as we look at it, and other things that we think support, you know, a strong value for the business. Hopefully, you know, as we continue to show strong numbers and, you know, through a market that's, you know, still very good but not quite as extraordinary as last year, that story will gain traction. It's a question for you as well as for us, I think. Very fair. Yeah. Thanks for all the thoughts there, Brian. Our next question will come from Liam Burke with B. Riley Securities. You may now go ahead. Thank you. Good morning, Brian. Good morning, John. Morning. Brian, your Lifecycle leases are up to 60%. We're seeing obviously investment this year normalizing from last year's peaks. Do you expect that trend to markedly continue? You know, we'll see. I mean, interestingly, you know, a lot of the increase, in fact probably all of it almost, of the increase in containers on lifecycle leases are not driven by our new container investment. Most new containers, even if they're going on, you know, 10+ year leases, you know, aren't full life leases, although some of them that we did last year are. Most of that increase in that share of lifecycle leases, you know, certainly over the last five years, has come from what we're doing with our used containers. In fact, the typical rhythm for us has become to lease a container out, you know, on its first lease for, you know, a pretty long time, but something less than the full life. If it comes off hire or if we renew it with the same customer, to try to put it on a lease, you know, for its second structure, that'll carry it to the end. I mean, 60% is a lot. Like, I can't promise it's gonna go up too much further from there, just given the mix of containers in our fleet, in terms of the ages. We do think it's something that's become a feature of the business and certainly a feature of how we work with our customers, that we think that number is gonna stay pretty high. Great. On those renewal rates, are they the same, higher, lower, when you extend that used container to the full life cycle? Yeah. I mean, right now the market rate for new containers and for used leased containers that we're leasing out currently, you know, are significantly higher than the average rates in our portfolio, and also higher than the rates on leases that are expiring over the next, you know, four or five years. Generally, there's a tailwind as we're renewing those leases. You know, that tailwind gets reflected in different ways. Sometimes we reflect it in higher rates than we do, and we have pushed up a lot of rates over the last 12 months, you know, as we've reached the end of this. Typically, customers can hold on to containers for a while after the lease expires, you know, usually 12 months or so. We have to wait till then before we can really kind of force a renewal or an increase. We've been doing that. Sometimes though, that kind of strength in the market, we reflect more on duration. We're always doing you know, it's actually quite easy on these lifecycle leases to sort of understand the trade-off of rate and duration, because it's a lifecycle lease. If we can get the customer to keep it until year 16, or in some cases even year 17 or longer, that actually has a lot of value, perhaps more value than raising rates on a contract that might expire when it's 13 or 14. We think of it in different ways, but we have been able to capture, you know, that value for sure, over the last 12 months or so. Great. Your ROE is north of 30%. Obviously, that's not something that you can carry and sustainable. As the business normalizes, congestion eases, traffic gets to normal, would you expect the ROE to settle in at a rate higher than your historical levels? For sure, I think, you know, both things you say there are right in the way that we think about it, that, you know, first, we do think the ROE will come down. You know, we don't think we're writing, you know, business always at 30% +. That reflects, you know, very good business that we've written, plus, you know, extremely high utilization. I was talking with Michael earlier, just, you know, really unprecedented sale prices. You know, in particular, as the sale prices come down, we'll start to see that ROE come down. We think our utilization, in fact, is gonna stay quite high, at least into the foreseeable future. Yeah, you're right. I think we'll see utilization come down somewhat, but we'll also see it be, you know, at a higher range than where it was before the last few years, reflecting, again, these things we've been talking about, these durable improvements to our lease portfolio, the sort of massive investments in these high-value, high-margin containers and leases over the last few years. Again, this just really great refinancing activity and financing cost that we've locked in. Sure. Thank you, Brian. Our next question will come from Ken Hoexter with Bank of America. You may now go ahead. Hey. Great. Good morning, Brian, John, and John. I guess it's incredible what you've done the last few years and all the credit for that. You're now targeting earnings to roll over, and I think it's been maybe seven, eight quarters since we've heard you kind of talk about a sequential decline. Maybe just talk about that for a second. What are the terms for the current boxes? Last year, or I guess through the last couple quarters, you talked about up to 13 years. I think you just mentioned you just threw out a 10-year timeframe. Is that what you're looking at now from shippers? Is it now 10 years? Maybe talk a little bit about the lease rates within that. Is there anything different in terms of where pricing is now versus where it was? Yeah. You know, we put some charts into our presentation looking at, you know, what's happened with container prices, and that's pretty similar to what's happened with market leasing rates. You know, as we've seen the market come from really unprecedented, you know, shortages of containers to just tight, you know, the premiums of, you know, that the factories can charge for getting access to their capacity has come down, and that's reflected in, you know, lower market leasing rates. But I think it all depends on the perspective you're measuring against. You know, container prices and market leasing rates are lower, you know, than they were, you know, in July 2021, which was a condition we've never seen before. You know, if you compare back over my career, which now I think as you know stretches back like 23 years with this company, I had never seen container prices at where they are today until 2021. Container prices, and that's reflected in market leasing rates as well, I mean, you know, 20-something-year highs with the exception of last year. You know, when we look at the market, we say, "You know, boy, this is actually a pretty nice market." If you had transported us from 2015 to here, it would be, this is unbelievable, you know. Obviously compared to just really unprecedented shortage conditions last year at unprecedented pricing, it's down a little bit from that. You know, in terms of our earnings, you know, I'd say overall, we were very optimistic, you know, on our financial performance, over the rest of this year and into the longer term. It's something we've, I think, probably repeated a few times. You know, and I guess, yes, we did guide that we think our second quarter, you know, will be slightly lower than the first quarter, mainly again, as these sale prices start to come a little bit back toward earth. You know, we're still gonna be, we think, at levels of profitability that are really quite exceptional, you know, with you know, very high profitability relative to our history, very high returns on equity, and getting maybe back to Michael's question early on, still very low multiples relative to our share price. You know, at least what we keep trying to say, we think it's not a question of what's the trajectory of the earnings, it's where are they, you know, and how do they relate, you know, to the value of the business. Again, we think they're gonna stay if you know, the things we've done to our business are durable like we expect. You know, we think our earnings are gonna stay very high, in absolute terms, and very high relative to the current value of the business, which frankly is one reason why we've been buying the shares. No, I understand that, but I just wanna understand what's changed. It, you know, you used to put in the release or in the charts what was the term of new boxes, it fluctuated from. Oh, sure. What's the timeframe for new boxes? Yeah. I'd say most of the deals we're doing right now are in the 10-year duration. It's down a little bit from, you know, most of 2021 was more kind of like 12 or 13. I think that really just reflects the container prices coming back down to earth a little bit. You know, that when container prices are, you know, again, still very high, you know, but no longer at, you know, you know, close to $4,000, it's easier to spread the premium than it was before. Again, we would look at there's been no other year in my history where we've done 10-year leases as the norm. Again, we still look at it and say it's a pretty attractive leased out environment, even if, you know, not quite as strong as 2021. The returns on these boxes, are they the same, Brian? Or I get it, right, if you can distribute it in a shorter period of time. Are I guess, the lease rate return levels similar given that- Yeah. I mean, again, I think they're strong. You know, to say the same thing as before, the returns are probably, again, a little bit down from the levels we got in 2021. I mean, there were certainly a few quarters there, you know, where we were more, you know, capped by relationship reasons, you know, than ability to get the deals done, you know, just because the boxes were needed so badly by our customers and the customers of our customers. You know, now it's much more of a regular market, you know, where multiple leasing companies can supply containers to the inquiries that are out there. Again, pricing's reasonable, you know, and again, reflecting, you know, a relatively tight market for containers, and, you know, just the strength of our business. You know, we don't really feel we have to reach, you know, to, you know, for things. Certainly, again, I just characterize it as we think the market is constructive. It is a lot of things that are positive for us, especially the container prices and leasing rates and the tightness of container supply. You know, not quite as extraordinary as 2021. Yeah. I guess just to understand the sustainability, right? I mean, you still have very little. I don't know if you had one of the charts up that you've had before, right, where you have just very little coming due in this year, next year. Is there a chart that highlights the duration? There is, Ken. We put it in the appendix, but it actually should be in the presentation. Yeah, it's page 15 in the chart. Perfect. You know, we didn't put it in the—it hasn't been there in a few quarters just because there's not that much of a story to it that, you know, there's, when you look at the expirations relative to the fleet, it's a pretty small percentage of our fleet that, you know, does expire over the next few years. For the Dry containers, you know, the market leasing rate, as I was talking about earlier, you know, are significantly above the rates of the, you know, leases that are expiring. I mean, generally, it's a good news story, and I think this, we kind of replaced a little bit in the main presentation, you know, with the things that John Burns talked about, you know, just the very high percentage of our containers on long-term lease and the long duration of those leases. This chart kind of falls out from that. Yeah, we still think people do like to see it, and it's in there. Yeah, no, I think that's a great chart just to highlight that there's not much really coming due. Just two cleanup questions, if I can. One, you noted the buyback was 1.7 million shares up to April 29. Is there a quarterly number? I think on the cash flow, I got $81 million instead of the $110. Is there a share number there for the quarter as opposed to- Yeah, there is. John is flipping through it now. It shows in the Q. You know, frankly, it's funny, we were debating what numbers are most useful for investors to put in there. Initially, we had, like, all four numbers, like what have we done since September, what's year to date, what's first quarter. Yeah, we can, it, John's quickly scrambling for that. It's 1.3. 1.3. Perfect. Thanks. Sorry for the technical one. No, no. Then my last one, just so I understand, John, you said something interesting at the beginning of the conversation. I just wanna make sure I understood it. The balance sheet assets, asset base declined sequentially, right? If I look at net assets, gross assets, but you said something that, is that due to the larger lease-up, or is that something different? I just want to understand what you were throwing out there. No. What I was saying is that, you know, we think, you know, for the first half of the year, you know, adding on the second quarter and based on what we've ordered to date, we're probably at replacement levels. On a, you know, full year basis at the end of the second quarter, we think we'll be roughly flat on a revenue earning asset basis. You know, the actual acceptances to the end of the first quarter was lower than what we've, you know, than half of what we ordered was on the low end. We've got more containers coming in, and we think we'll be flat on an overall asset base for the, you know, first half of the year. To keep it flat, do you have to accelerate CapEx? The orders have been made, and we have, you know, we think more orders coming. It's just the acceptance level, the actual units coming into the fleet was lower than the orders placed, if you will. Actually, just the way to think of it, Ken, is, I think we announced in the press release that we had ordered something like $425 million or so of CapEx year to date. You know, most of that CapEx should be delivered by June 30th, and probably a little bit, you know, on top of that. You know, we showed in other charts that our planned capital spending is about $900 million per year, you know. If you think about, you know, roughly 450 as being, you know, where we are for the first half, that's right at, you know, kind of the replacement level. But just given the timing of our orders and timing of delivery, more of that 400 and change is gonna be delivered in the second quarter than the first quarter, which is why you saw a slight decrease sequentially from December 31 to March 31, and then probably a slight increase sequentially from March 31 to June 30, making the December 31 to June 30 relatively flat. Got it. That's helpful. Just wanna make sure I wasn't missing something. Thank you very much for the time, guys. Appreciate it. Yeah. Thanks, Ken. Thanks, Ken. Again, if you have a question, please press star then one. Our next question will come from Jon Tanwanteng with CJS Securities. You may now go ahead. It's actually Larry Solow. I don't know how that got that name, but that's great. That works. Anyhow, good morning, guys. Just, it's one of my colleagues. I don't know how to get his name. Just a couple of follow-ups there. Just on the earnings outlook, I know you only give one quarter outlook and not to define what, you know, a modest decline means. Certainly doesn't sound like your earnings are, quote, unquote, "rolling over." Can you just, you know, worst case scenario, obviously it seems like, you know, not worst case scenario, but a sort of a negative look. To me, it seems like it can't fall too much over the, even the next couple of years if I just look at, you know, you only have, it looks like 5% or so of your containers coming off contract the next couple of years. Obviously, we seem to be in a holding pattern today. Shippers don't know, you know, kind of know where the direction we're gonna go, so no one's dropping off so fast. In the meantime, you're earning great, you know, returns, and you're buying back shares, and it sounds like that will continue in the short run. You know, you just replace your containers just at a minimum and use your cash flow for buybacks until we sort of get better direction. Is that a fair way to look at it? Even if things get really bad, there aren't that many containers that are coming off contract, right? Just trying to assess, you know, I think the market perception is just that we're going to head into a recession and demand is going to fall out of bed. Even if that happens, it doesn't seem like you guys are. There's a tremendous risk for you. Sure. You know, we, when we talk publicly, we do like to limit it to one quarter. You know- Right We just find that, you know, it's maybe just risky for us, you know, to put too much out there. We also do try to give, you know, help people think about, you know, how to expect, you know, general trends in the business to play out. We do a lot of scenario modeling internally. We have a forecasting model that's built up from a lease level, and we then, you know, turn that, you know, into a long-term financial forecast. Our general view is that our utilization is going to be extremely resilient against market conditions because of, you know, the long duration of the portfolio. You know, again, these are financial models and they're subject to, you know, the assumptions we make. Our general view is that even if market conditions were to turn extremely negative, which in fact, we don't really think, you know, that we're going to see utilization stay at historically high levels, you know, into the, you know, past 2022, I mean, well into the medium term and beyond perhaps. Right. That typically is the most important driver of our earnings, you know, is just what percentage of containers are on hire, generating revenue, not accumulating costs. They're on lease, a lot of these containers are on very profitable leases. Again, that sustains our profitability, you know, well beyond this year as well. You know, the greatest uncertainty, and I think the part of our income statement, you know, most subject to market conditions is our gains on sale. Right We have talked about that we do expect those to normalize just as prices come back to Earth. Again, there'll be some offset as volumes tick up, there. Offsetting that, you know, that sort of negative pressure, you know, should be, as you mentioned, the decreasing share count, and also growth over time. You know, we think that, again, some of the longer term charts we showed, you know, indicate that we don't need great market conditions to drive value in this business. You know, we grow. Right across a wide range of conditions and create value across those same wide range of conditions. So again, we look out and we feel we're in a really great place. We had a, you know, a historic run over the last 21 months that's allowed us to build a lot of long-term value. The market out there still remains underpinned by two very strong, you know, demand drivers, high goods consumption and logistical bottlenecks. Putting that together, you know, we've actually got a pretty optimistic outlook of where we go from here. Well, what about in terms of some inflation, obviously, you know, most of that inflationary pressures have obviously pretty much helped you, right? You know, in terms of pricing and your interest rates are mostly fixed now, so that's not hurting you. What about, you know, in terms of direct cost, does it in an inflationary period, does it? I can't imagine the cost to store a container or repair a container goes up as much as overall inflation. Or does it? Are you at risk as these things come, you know, as direct costs potentially rise as capacity utilization falls a little bit? You know, do you have a higher risk, a higher cost this time around within a higher inflationary period than, say, a few years ago, or not really? Yeah, I'd say in general, you know, we think inflation is value creating for the business, you know. Right Mainly driven by the fact that we have, you know, lots of real assets and containers that we, you know, remarket to re-lease them, or we remarket them and then sell. Those values, you know, certainly are very correlated with inflation. You know, those containers are financed primarily with nominal debt, you know, with fixed interest rates. You know, while the value of our liabilities doesn't change very much as inflation goes up, the value of our assets does. That's sort of the main reason why, you know, we think, again, inflation creates value, for us and for our shareholders. You know, I think there is inflationary impacts on direct operating expenses like repairs and storage, you know, but those are, you know, they can be, you know, significant in terms of the year-to-year changes, but it's still a relatively, you know, small share of our expense base. I mean, the vast majority of our expenses are ownership costs of container depreciation and interest expense. Again, the depreciation, of course, is fixed because we've purchased the containers for a historical number, you know. Interest expense, again, is locked in very well through our debt portfolio and hedging. Again, we feel that, you know, overall it's a net positive. Just last question. What do you make, if anything, I know it's sort of a very short time period. You know, last couple of years, most of the container purchases have certainly been biased towards leasing companies themselves. Last couple of quarters, or at least this year to date, looks like the shippers have been buying a larger percentage. I realize it's a small number, short time period, but do you make anything of that? Maybe it's just their balance sheets have improved their short term, so they're using some of their cash. Any thoughts on that? Yeah, for sure. I think it's a number of things happening. Yeah, for sure, the shipping lines have radically improved their capital structures over the last year and a half. And frankly, most are carrying substantial net cash balances right now. Right when you have lots of extra cash and a lot of the shipping lines have paid down the debt that's pre-payable easily. Oops, we've run out of time. I'm not sure. Can you still hear us, operator? Anthony- Sorry Are you on the line? Yeah, that's actually the main speaker line playing the music. Uh. Part- Okay. Let's see. We'll carry on perhaps over the nice music here for us. Wait, I think that actually might be John's line. Let's see here. Yeah. Why don't you just cut it off if you can? Yeah, that was John's line. Okay. Yeah. Thank you. Yeah, sorry for the interruption, everyone. My gosh, where were we? Yeah, sorry. Thanks. Thank you for reminding me. We're talking about the mix of, yeah, shipping line purchases versus lease co-purchases. We're saying there's a number of factors driving it. You know, one being that, you know, the shipping lines are carrying a lot of cash because of their very strong profitability over the last few years. I think and that is driving an increase in purchasing. Also, the shipping lines do tend to do most of their buying early in the year. You know, unlike us, the shipping lines set typically annual budgets for buying containers, and they typically do the purchasing ahead of the peak season, which starts to kind of get going in the second quarter. We often do see this, you know, higher buying for shipping lines, you know, as you get towards the, you know, the first part of the year. I think there's also just a little bit of sort of price uncertainty for leasing companies. You know, we think of our container purchases as investments and we wanna make sure that we can, you know, lease them out for, you know, rates that match the investments that we're making. You know, with the shipping lines, I think, look at the containers as more of just something you need to have to run your business. As price has been changing, you know, leasing companies are trying to be strategic about when to jump in. You know, we have been coming in selectively to maintain our capability to supply, but I think that also, you know, when prices are changing, leasing companies, you know, can be a little more cautious than the shipping lines. Operator, are you there? Yes. That will conclude our question and answer session. I'd like to turn the conference back over to Brian Sondey, CEO, for any closing remarks. Yeah. I'd just like to thank everyone for your interest in Triton and your support. Apologize a little bit for our technical challenges there at the end, but we'll be looking forward to talking with you soon. Thank you. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.