##### Table of Contents









UNITED STATES SECURITIES AND
EXCHANGE COMMISSION


Washington, D.C.
20549-1004


Form 10-K


|                                                                                                  
|--------------------------------------------------------------------------------------------------
|þ Annual Report Pursuant
    to Section 13 or 15(d) of the Securities Exchange Act of
    1934    
|                                                                                                  
|For the fiscal year ended August 31, 2005                                                         
|or                                                                                                
|                                                                                                  
|                                                                                                  
|o Transition Report
    Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934
|                                                                                                  
|for the transition period
    from            to                                                  



THE GREENBRIER COMPANIES,
INC.




|                                                                   |  |                                                              |  |                                     
|------------------------------------------------------------------ |  | ------------------------------------------------------------ |  | ------------------------------------
|Delaware                                                           |  | 3742                                                         |  | 93-0816972                          
|(State or other jurisdiction
    of incorporation or organization) |  | (Primary Standard Industrial
    Classification Code Number) |  | (I.R.S. Employer Identification No.)

CO-REGISTRANTS AND SUBSIDIARY GUARANTORS


|                                        |  |        |  |      |  |           
|--------------------------------------- |  | ------ |  | ---- |  | ----------
|Autostack Company, LLC                  |  | Oregon |  | 3743 |  | 93-0981840
|Greenbrier-Concarril, LLC               |  | Oregon |  | 3743 |  | 93-1262344
|Greenbrier Leasing Company, LLC         |  | Oregon |  | 3743 |  | 31-0789836
|Greenbrier Leasing, L.P.                |  | Oregon |  | 3743 |  | 91-1960693
|Greenbrier Leasing Limited Partner, LLC |  | Oregon |  | 3743 |  | 93-1266038
|Greenbrier Management Services, LLC     |  | Oregon |  | 3743 |  | 93-1266040
|Greenbrier Railcar, LLC                 |  | Oregon |  | 3743 |  | 93-0971066
|Gunderson, LLC                          |  | Oregon |  | 3743 |  | 93-0180205
|Gunderson Marine, LLC                   |  | Oregon |  | 3743 |  | 93-1127982
|Gunderson Rail Services, LLC            |  | Oregon |  | 3743 |  | 93-1123815
|Gunderson Specialty Products, LLC       |  | Oregon |  | 3743 |  | 93-0180205

|                                                                                                                              |  |                                                                                                                                             |  |                                                                                                                                         |  |                                                                                                                               
|----------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------
|The Greenbrier Companies, Inc.
    One Centerpointe Drive, Suite 200
    Lake Oswego Oregon
    97035-8612
    (503) 684-7000 |  | Autostack Company, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego Oregon
    97035-8612
    (503) 684-7000                       |  | Greenbrier-Concarril, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego Oregon
    97035-8612
    (503) 684-7000                |  | Greenbrier Leasing Company, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego Oregon
    97035-8612
    (503) 684-7000
|                                                                                                                             
|Greenbrier Leasing, L.P.
    One Centerpointe Drive, Suite 200
    Lake Oswego, Oregon
    97035-8612
    (503) 684-7000      |  | Greenbrier Leasing
    Limited Partner, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego, Oregon
    97035-8612
    (503) 684-7000 |  | Greenbrier Management
    Services, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego, Oregon
    97035-8612
    (503) 684-7000 |  | Greenbrier Railcar, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego, Oregon
    97035-8612
    (503) 684-7000       
|                                                                                                                             
|Gunderson, LLC
    4350 NW Front Avenue
    Portland, Oregon 97210
    (503) 972-5700                                         |  | Gunderson Marine, LLC
    4350 NW Front Avenue
    Portland, Oregon 97210
    (503) 972-5700                                                |  | Gunderson Rail Services, LLC
    One Centerpointe Drive, Suite 200
    Lake Oswego, Oregon
    97035-8612
    (503) 684-7000            |  | Gunderson Specialty
    Products, LLC
    4350 NW Front Avenue
    Portland, Oregon
    (503) 972-5700                        

(Address, including zip code and telephone number


including area code of registrant principal executive
offices)




|                                         |  |                                            
|---------------------------------------- |  | -------------------------------------------
|(Title of Each Class)                    |  | (Name of Each Exchange on Which Registered)
|Common Stock, par value $0.001 per share |  | New York Stock Exchange                    



None




X


o




X




X






DOCUMENTS INCORPORATED BY
REFERENCE












---










The Greenbrier Companies,
Inc.


Form 10-K


TABLE OF CONTENTS





|                |  |                                                                                                        |  |      |    | 
|--------------- |  | ------------------------------------------------------------------------------------------------------ |  | ---- | -- | 
|                |  |                                                                                                        |  | PAGE |   
|PART I          |  |                                                                                                        |  |      |    | 
|Item 1.         |  | BUSINESS                                                                                               |  |      | 4  | 
|Item 2.         |  | PROPERTIES                                                                                             |  |      | 10 | 
|Item 3.         |  | LEGAL
    PROCEEDINGS                                                                                  |  |      | 11 | 
|Item 4.         |  | SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                |  |      | 11 | 
|PART II         |  |                                                                                                        |  |      |    | 
|Item 5.         |  | MARKET
    PRICE OF AND DIVIDENDS ON THE REGISTRANTS COMMON EQUITY AND
    RELATED STOCKHOLDER MATTERS |  |      | 11 | 
|Item 6.         |  | SELECTED
    FINANCIAL DATA                                                                            |  |      | 13 | 
|Item 7.         |  | MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS          |  |      | 14 | 
|Item 7a.        |  | QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                         |  |      | 20 | 
|Item 8.         |  | FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA                                                        |  |      | 21 | 
|Item 9.         |  | CHANGES IN
    AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
    DISCLOSURE           |  |      | 56 | 
|Item 9a.        |  | CONTROLS
    AND PROCEDURES                                                                            |  |      | 56 | 
|PART III        |  |                                                                                                        |  |      |    | 
|Item 10.        |  | DIRECTORS
    AND EXECUTIVE OFFICERS OF REGISTRANT                                                     |  |      | 57 | 
|Item 11.        |  | EXECUTIVE
    COMPENSATION                                                                             |  |      | 57 | 
|Item 12.        |  | SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS |  |      | 57 | 
|Item 13.        |  | CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS                                                     |  |      | 57 | 
|Item 14.        |  | PRINCIPAL
    ACCOUNTANT FEES AND SERVICES                                                             |  |      | 57 | 
|PART IV         |  |                                                                                                        |  |      |    | 
|Item 15.        |  | EXHIBITS,
    FINANCIAL STATEMENT SCHEDULES                                                            |  |      | 58 | 
|                |  | SIGNATURES                                                                                             |  |      | 62 | 
|EXHIBIT 10.36  
|EXHIBIT 12.1   
|EXHIBIT 21.1   
|EXHIBIT 23     
|EXHIBIT 31.1(a)
|EXHIBIT 31.2(b)
|EXHIBIT 32.1(c)
|EXHIBIT 32.2(d)







2                                        The
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##### Table of Contents






PART I


Forward-Looking
Statements






|  |                                                                                                                                                                              
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | availability of financing sources and borrowing base for working
    capital, other business development activities, capital spending
    and railcar warehousing activities;
| 
| | ability to renew or obtain sufficient lines of credit and
    performance guarantees on acceptable terms;                                                                    
| 
| | ability to utilize beneficial tax strategies;                                                                                                                                
| 
| | ability to grow our railcar services, lease fleet and management
    services business;                                                                                      
| 
| | ability to obtain sales contracts which contain provisions for
    the escalation of prices due to increased costs of materials and
    components;                          
| 
| | ability to obtain adequate certification and licensing of
    products; and                                                                                                  
| 
| | short- and long-term revenue and earnings effects of the above
    items.                                                                                                    





|  |                                                                                                                                                                                                         
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | a delay or failure of acquired businesses, products or services
    to compete successfully;                                                                                                            
| 
| | decreases in carrying value of assets due to impairment;                                                                                                                                                
| 
| | severance or other costs or charges associated with lay-offs,
    shutdowns, or reducing the size and scope of operations;                                                                              
| 
| | changes in future maintenance requirements;                                                                                                                                                             
| 
| | effects of local statutory accounting conventions on compliance
    with covenants in certain loan agreements;                                                                                          
| 
| | domestic and global business conditions and growth or reduction
    in the surface transportation industry;                                                                                             
| 
| | actual future costs and the availability of materials and a
    trained workforce;                                                                                                                      
| 
| | ability to maintain good relationships with third party labor
    providers or collective bargaining units;                                                                                             
| 
| | availability of subcontractors;                                                                                                                                                                         
| 
| | steel price increases, scrap surcharges and other commodity
    price fluctuations and their impact on railcar demand and margin;                                                                       
| 
| | changes in product mix and the mix between the manufacturing and
    leasing & services segments;                                                                                                       
| 
| | labor disputes, energy shortages or operating difficulties that
    might disrupt manufacturing operations or the flow of cargo;                                                                        
| 
| | production difficulties and product delivery delays as a result
    of, among other matters, changing technologies or
    non-performance of alliance partners, subcontractors or
    suppliers;        
| 
| | ability to obtain suitable contracts for railcars held for sale;                                                                                                                                        
| 
| | lower than anticipated residual values for leased equipment;                                                                                                                                            
| 
| | discovery of defects in railcars resulting in increased warranty
    costs or litigation;                                                                                                               
| 
| | resolution or outcome of investigations and pending or future
    litigation;                                                                                                                           
| 
| | the ability to consummate expected sales;                                                                                                                                                               
| 
| | delays in receipt of orders, risks that contracts may be
    canceled during their term or not renewed and that customers may
    not purchase as much equipment under the contracts as
    anticipated;
| 
| | financial condition of principal customers;                                                                                                                                                             
| 
| | market acceptance of products;                                                                                                                                                                          
| 
| | ability to determine and obtain adequate levels of insurance at
    acceptable rates;                                                                                                                   
| 
| | competitive factors, including introduction of competitive
    products, price pressures, limited customer base and
    competitiveness of our manufacturing facilities and products;                   
| 
| | industry over-capacity and our manufacturing capacity
    utilization;                                                                                                                                  
| 
| | continued industry demand at current and anticipated levels for
    railcar products;                                                                                                                   
| 
| | domestic and global political, regulatory or economic conditions
    including such matters as terrorism, war, embargoes or quotas;                                                                     
| 
| | ability to adjust to the cyclical nature of the railcar industry;                                                                                                                                       





3                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents





|  |                                                                                                                                                                                                    
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | the effects of car hire deprescription on leasing revenue;                                                                                                                                         
| 
| | changes in interest rates;                                                                                                                                                                         
| 
| | actions by various regulatory agencies;                                                                                                                                                            
| 
| | changes in fuel and/or energy prices;                                                                                                                                                              
| 
| | availability and price of essential raw materials, specialties
    or components, including steel castings, to permit manufacture
    of units on order;                                           
| 
| | ability to replace lease revenue and earnings from maturing and
    terminating leases with revenue and earnings from additions to
    the lease fleet, lease renewals and management services; and
| 
| | financial impacts from currency fluctuations in our worldwide
    operations.                                                                                                                      








|        |         
|------- | --------
|Item 1. | BUSINESS

Introduction










Significant Developments in
2005










3 8






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##### Table of Contents





Products and Services 
 Manufacturing


North American Railcar Manufacturing


Intermodal Railcars








|  |                                                                                                                                                       
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------
| | increased train density (two containers are carried within the
    same longitudinal space conventionally used to carry one trailer
    or container);
| 
| | reduced railcar weight of up to 50% per container;                                                                                                    
| 
| | easier terminal handling characteristics;                                                                                                             
| 
| | reduced equipment costs of up to 40% less than the cost of
    providing the same carrying capacity with conventional equipment;                      
| 
| | superior ride quality compared to conventional equipment,
    leading to reduced damage claims; and                                                   
| 
| | increased fuel efficiency resulting from weight reduction and
    improved aerodynamics.                                                              



|                  |           |                        |         |           |              |         |              |       |  |     |     |                       |  |           |           |     |  |        |        |     |  |         |   |  |  |   |   |  |  |   |   |  |  |   |   |  |  |   |   |  |  |   |  |  | 
|----------------- | --------- | ---------------------- | ------- | --------- | ------------ | ------- | ------------ | ----- |  | --- | --- | --------------------- |  | --------- | --------- | --- |  | ------ | ------ | --- |  | ------- | - |  |  | - | - |  |  | - | - |  |  | - | - |  |  | - | - |  |  | - |  |  | 
|                  |           |                        |         |           |              |         |              |       |  |     |     | Unit sizes carried(1)
|                  |           |                        |         | Number of |              | Well    |              | Cargo |  |     |     |                      
|Product           |           | Type                   |         | wells     |              | size    |              | type  |  |     |     | 20                   |  | 40       |           | 45 |  | 48    |        | 53 |  | Trailer
|                 
|Maxi-Stack        |           | Articulated            |         |           |              | 5       |              |       |  | 40 |     |                       |  | Container |           |     |  | Top    |        |     |  |         |   |  |  | x |   |  |  | x |   |  |  | x |   |  |  | x |   |  |  |   | 
|                  |           |                        |         |           |              |         |              |       |  |     |     |                       |  |           |           |     |  |        | Bottom |     |  |         | x |  |  |   | x |  |  |   |   |  |  |   |   |  |  |   |   |  |  |   |  | 
|Maxi-Stack        |           | Articulated            |         |           |              | 3       |              |       |  | 53 |     |                       |  | Container |           |     |  | Top    |        |     |  |         |   |  |  | x |   |  |  | x |   |  |  | x |   |  |  | x |   |  |  |   | 
|                  |           |                        |         |           |              |         |              |       |  |     |     |                       |  |           |           |     |  |        | Bottom |     |  |         | x |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   |  | 
|All Purpose Husky |           | Stand-alone or         |         |           |              |         |              |       |  |     |     |                       |  |           |           |     |  |        |        |     |  |         |   |  |  |   |   |  |  |   |   |  |  |   |   |  |  |   |   |  |  |   | 
|                  | Stack 53 |                        | Drawbar |           |              |         | 1 or 3  unit |       |  |     | 53 |                       |  |           | Container |     |  |        | Top    |     |  |         |   |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   |  | 
|                  |           | connected              |         |           |              | drawbar |              |       |  | 53 |     |                       |  | Trailer   |           |     |  | Bottom |        |     |  | x       |   |  |  | x |   |  |  | x |   |  |  | x |   |  |  | x |   |  |  | x | 
|Husky Stack 53   |           | Stand-alone or Drawbar |         |           | 1 or 3  unit |         |              |       |  |     |     |                       |  |           |           |     |  |        |        |     |  |         |   |  |  |   |   |  |  |   |   |  |  |   |   |  |  |   |   |  |  |  
|                  |           | connected              |         |           |              |         | drawbar      |       |  |     | 53 |                       |  |           | Container |     |  |        | Top    |     |  |         |   |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   |  | 
|                  |           |                        |         |           |              |         |              |       |  |     |     |                       |  |           |           |     |  |        | Bottom |     |  |         | x |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   | x |  |  |   |  | 



|    |                                                                                           
|--- | ------------------------------------------------------------------------------------------
|(1) | Carrying capability may be dependant on unit size being carried
    in the adjoining well.







5                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents



Conventional Railcars


European Railcar Manufacturing


Railcar Repair and Refurbishing


Marine Vessel Fabrication


Leasing &
Services


Leasing






|                  |                              |                       |       |         |  |       |         |         |  |  |         |         | 
|----------------- | ---------------------------- | --------------------- | ----- | ------- |  | ----- | ------- | ------- |  |  | ------- | ------- | 
|                  |                              | Fleet Profile(1)     
|                  |                              | As of August 31, 2005
|                  |                              |                      
|                  |                              | Owned                 |       | Managed |  | Total
|                  |                              | Units(2)              |       | Units   |  | Units
|                 
|Customer Profile: |                              |                       |       |         |  |       |         |         |  |  |         |        
|                 
|                  | Class I Railroads            |                       |       | 4,697   |  |       |         | 106,267 |  |  |         | 110,964 | 
|                 
|                  | Non-Class I Railroads        |                       |       | 2,021   |  |       |         | 12,864  |  |  |         | 14,885  | 
|                 
|                  | Shipping Companies           |                       |       | 2,200   |  |       |         | 2,088   |  |  |         | 4,288   | 
|                 
|                  | Leasing Companies            |                       |       | 320     |  |       |         | 7,411   |  |  |         | 7,731   | 
|                 
|                  | Enroute to Customer Location |                       |       | 550     |  |       |         | 3       |  |  |         | 553     | 
|                 
|                  | Off-Lease                    |                       |       | 170     |  |       |         | 12      |  |  |         | 182     | 
|                 
|Total Units       |                              |                       | 9,958 |         |  |       | 128,645 |         |  |  | 138,603 |        
|                 



|    |                                                                                                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------
|(1) | Each platform of a railcar is treated as a separate unit.                                                                           
|   
|(2) | Percent of owned units on lease is 98.3%; average age of owned
    units is 22 years; average remaining lease term is
    2.7 years.



Management Services






6                                        The
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##### Table of Contents





Backlog




|                                 |  |            |       |      |  |      |        |  |  |   |        | 
|-------------------------------- |  | ---------- | ----- | ---- |  | ---- | ------ |  |  | - | ------ | 
|                                 |  | August 31,
|                                 |  |           
|                                 |  | 2005       |       | 2004 |  | 2003
|                                
|New railcar backlog
    units(1) |  |            | 9,600 |      |  |      | 13,100 |  |  |   | 10,700 | 
|                                
|Estimated value (in millions)    |  | $          | 550   |      |  | $    | 760    |  |  | $ | 580    | 



|    |                                                          
|--- | ---------------------------------------------------------
|(1) | Each platform of a railcar is treated as a separate unit.



Customers






Raw Materials and
Components












7                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents





Competition








Marketing and Product
Development








Patents and Trademarks




Environmental Matters










8                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents







Regulation






Employees




Additional Information








9                                        The
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##### Table of Contents






Item 2.          PROPERTIES




|                                                                            |  |                                                                                                                                    |  |                             |  |                            
|--------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------- |  | ---------------------------
|Description                                                                 |  | Size                                                                                                                               |  | Location                    |  | Status                     
|                                                                           
|Manufacturing Segment                                                       |  |                                                                                                                                    |  |                             |  |                            
|                                                                           
|Railcar and marine manufacturing facility and wheel
    reconditioning shop |  | 63 acres including 908,000 sq. ft. of manufacturing
    space and a 750-ft. side-launch ways for launching ocean going
    vessels |  | Portland, Oregon            |  | Owned                      
|                                                                           
|Railcar manufacturing facility                                              |  | 100 acres with 778,000 sq. ft. of manufacturing
    space                                                                          |  | Trenton, Nova Scotia Canada |  | Owned                      
|                                                                           
|Railcar manufacturing facility                                              |  | 88 acres with 676,000 sq. ft. of manufacturing
    space                                                                           |  | Swidnica, Poland            |  | Owned                      
|                                                                           
|Railcar manufacturing and wheel reconditioning shop                         |  | 462,000 sq. ft. of manufacturing space, which includes
    a 152,000 sq. ft. wheel reconditioning shop                             |  | Sahagun, Mexico             |  | Leased                     
|                                                                           
|Railcar repair facility                                                     |  | 70 acres                                                                                                                           |  | Cleburne, Texas             |  | Leased with purchase option
|                                                                           
|Railcar repair facility                                                     |  | 51.7 acres                                                                                                                         |  | Kansas City, Missouri       |  | Leased                     
|                                                                           
|Railcar repair facility                                                     |  | 40 acres                                                                                                                           |  | Finley, Washington          |  | Leased with purchase option
|                                                                           
|Railcar repair facility                                                     |  | 32 acres                                                                                                                           |  | Dothan, Alabama             |  | Owned                      
|                                                                           
|Railcar repair facility                                                     |  | 18 acres                                                                                                                           |  | Atchison, Kansas            |  | Owned                      
|                                                                           
|Railcar repair facility                                                     |  | 11.6 acres                                                                                                                         |  | Hodge, Louisiana            |  | Owned                      
|                                                                           
|Railcar repair facility                                                     |  | 5.4 acres                                                                                                                          |  | Springfield, Oregon         |  | Leased                     
|                                                                           
|Railcar repair facility                                                     |  | 0.9 acres                                                                                                                          |  | Modesto, California         |  | Leased                     
|                                                                           
|Railcar repair facility                                                     |  | 3.3 acres                                                                                                                          |  | Golden, Colorado            |  | Leased                     
|                                                                           
|Wheel reconditioning shop                                                   |  | 5.6 acres                                                                                                                          |  | Tacoma, Washington          |  | Leased                     
|                                                                           
|Wheel reconditioning shop                                                   |  | 0.5 acres                                                                                                                          |  | Pine Bluff, Arkansas        |  | Leased                     
|                                                                           
|Leasing & Services
    Segment                                              |  |                                                                                                                                    |  |                             |  |                            
|                                                                           
|Executive offices, railcar marketing and leasing activities                 |  | 37,000 sq. ft.                                                                                                                     |  | Lake Oswego, Oregon         |  | Leased                     







10                                        The
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##### Table of Contents






Item 3.          LEGAL
PROCEEDINGS



















Item 4.          SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS







PART II





Item 5.          MARKET
PRICE OF AND DIVIDENDS ON THE REGISTRANTS COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS




|               |  |      |       |     |  |   |       | 
|-------------- |  | ---- | ----- | --- |  | - | ----- | 
|               |  | High |       | Low
|              
|2005           |  |      |       |     |  |   |       | 
|Fourth quarter |  | $    | 30.70 |     |  | $ | 25.80 | 
|Third quarter  |  | $    | 37.15 |     |  | $ | 25.40 | 
|Second quarter |  | $    | 36.99 |     |  | $ | 25.56 | 
|First quarter  |  | $    | 29.85 |     |  | $ | 19.69 | 
|2004           |  |      |       |     |  |   |       | 
|Fourth quarter |  | $    | 24.12 |     |  | $ | 16.25 | 
|Third quarter  |  | $    | 18.55 |     |  | $ | 14.01 | 
|Second quarter |  | $    | 20.25 |     |  | $ | 14.40 | 
|First quarter  |  | $    | 15.85 |     |  | $ | 12.25 | 







11                                        The
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##### Table of Contents



Equity Compensation Plan
Information




|                                                               |  |                      |         |                      |  |                      |      |  |  |  |         | 
|-------------------------------------------------------------- |  | -------------------- | ------- | -------------------- |  | -------------------- | ---- |  |  |  | ------- | 
|                                                               |  | Number of securities |         |                      |  | Number of securities
|                                                               |  | to be issued         |         | Weighted average     |  | remaining available 
|                                                               |  | upon exercise of     |         | exercise price of    |  | for future issuance 
|                                                               |  | outstanding options, |         | outstanding options, |  | under equity        
|Plan Category                                                  |  | warrants and rights  |         | warrants and rights  |  | compensation plans  
|                                                              
|                                                              
|Equity compensation plans approved by security holders
    (1) |  |                      | 472,820 |                      |  | $                    | 7.24 |  |  |  | 948,636 | 
|                                                              
|                                                              
|Equity compensation plans not approved by security holders     |  |                      | None    |                      |  |                      | None |  |  |  | None    | 
|                                                              



|    |                                                                                              
|--- | ---------------------------------------------------------------------------------------------
|(1) | Includes the Stock Incentive Plan 2000 (The 2000 Plan) and the
    2005 Stock Incentive Plan.





12                                        The
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##### Table of Contents






Item 6.          SELECTED
FINANCIAL DATA


|                                            |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |         | 
|------------------------------------------- | --------------------- | ---- | --------- | ------- |  | ---- | ------- | ------- |  | ---- | ------- | ------- |  | - | ------- | ------- | - | - | ------- | ------- | 
|YEARS ENDED AUGUST 31,                     
|(In thousands, except per share data)       |                       | 2005 |           | 2004    |  | 2003 |         | 2002    |  | 2001
|                                           
|Statement of Operations
    Data            |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|Revenue:                                    |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Manufacturing         |      | $         | 941,161 |  |      | $       | 653,234 |  |      | $       | 461,882 |  |   | $       | 295,074 |   |   | $       | 513,012 | 
|                                            | Leasing & services    |      |           | 83,061  |  |      |         | 76,217  |  |      |         | 70,443  |  |   |         | 72,250  |   |   |         | 80,986  | 
|                                           
|                                            |                       | $    | 1,024,222 |         |  | $    | 729,451 |         |  | $    | 532,325 |         |  | $ | 367,324 |         |   | $ | 593,998 |        
|                                           
|Earnings (loss) from continuing operations  |                       | $    | 29,822    |         |  | $    | 20,039  |         |  | $    | 4,317   |         |  | $ | (26,094 | )       |   | $ | 1,119   |        
|Earnings from discontinued operations       |                       |      |          |         |  |      | 739     | (1)     |  |      |        |         |  |   |        |         |   |   |        |        
|                                           
|Net earnings (loss)                         |                       | $    | 29,822    |         |  | $    | 20,778  |         |  | $    | 4,317   |         |  | $ | (26,094 | ) (2)   |   | $ | 1,119   |        
|                                           
|Basic earnings (loss) per common share:     |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Continuing operations |      | $         | 1.99    |  |      | $       | 1.38    |  |      | $       | .31     |  |   | $       | (1.85   | ) |   | $       | .08     | 
|                                            | Net earnings (loss)   |      | $         | 1.99    |  |      | $       | 1.43    |  |      | $       | .31     |  |   | $       | (1.85   | ) |   | $       | .08     | 
|                                           
|Diluted earnings (loss) per common share:   |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Continuing operations |      | $         | 1.92    |  |      | $       | 1.32    |  |      | $       | .30     |  |   | $       | (1.85   | ) |   | $       | .08     | 
|                                            | Net earnings (loss)   |      | $         | 1.92    |  |      | $       | 1.37    |  |      | $       | .30     |  |   | $       | (1.85   | ) |   | $       | .08     | 
|                                           
|Weighted average common shares outstanding: |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Basic                 |      |           | 15,000  |  |      |         | 14,569  |  |      |         | 14,138  |  |   |         | 14,121  |   |   |         | 14,151  | 
|                                            | Diluted               |      |           | 15,560  |  |      |         | 15,199  |  |      |         | 14,325  |  |   |         | 14,121  |   |   |         | 14,170  | 
|Cash dividends paid per share               |                       | $    | .26       |         |  | $    | .06     |         |  | $    |        |         |  | $ | .06     |         |   | $ | .36     |        
|                                           
|Balance Sheet Data                          |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|Total assets                                |                       | $    | 671,207   |         |  | $    | 508,753 |         |  | $    | 538,948 |         |  | $ | 527,446 |         |   | $ | 606,180 |        
|Notes payable                               |                       | $    | 214,635   |         |  | $    | 97,513  |         |  | $    | 117,989 |         |  | $ | 144,131 |         |   | $ | 177,575 |        
|Subordinated debt                           |                       | $    | 8,617     |         |  | $    | 14,942  |         |  | $    | 20,921  |         |  | $ | 27,069  |         |   | $ | 37,491  |        
|Stockholders equity                        |                       | $    | 176,059   |         |  | $    | 139,289 |         |  | $    | 111,142 |         |  | $ | 103,139 |         |   | $ | 134,109 |        
|                                           
|Other Operating Data                        |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|New railcar units delivered                 |                       |      | 13,200    |         |  |      | 10,800  |         |  |      | 6,500   |         |  |   | 4,100   |         |   |   | 8,600   |        
|New railcar units backlog                   |                       |      | 9,600     |         |  |      | 13,100  |         |  |      | 10,700  |         |  |   | 5,200   |         |   |   | 3,700   |        
|Lease fleet:                                |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Units managed         |      |           | 128,645 |  |      |         | 122,676 |  |      |         | 114,701 |  |   |         | 35,562  |   |   |         | 26,306  | 
|                                            | Units owned           |      |           | 9,958   |  |      |         | 10,683  |  |      |         | 12,015  |  |   |         | 14,317  |   |   |         | 16,319  | 
|                                           
|Cash Flow Data                              |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|Capital expenditures                        |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Manufacturing         |      | $         | 16,318  |  |      | $       | 7,161   |  |      | $       | 7,390   |  |   | $       | 4,294   |   |   | $       | 10,761  | 
|                                            | Leasing & services    |      |           | 52,805  |  |      |         | 35,798  |  |      |         | 4,505   |  |   |         | 18,365  |   |   |         | 62,575  | 
|                                           
|                                            |                       | $    | 69,123    |         |  | $    | 42,959  |         |  | $    | 11,895  |         |  | $ | 22,659  |         |   | $ | 73,336  |        
|                                           
|Depreciation and amortization               |                       |      |           |         |  |      |         |         |  |      |         |         |  |   |         |         |   |   |         |        
|                                            | Manufacturing         |      | $         | 12,205  |  |      | $       | 9,399   |  |      | $       | 9,081   |  |   | $       | 13,903  |   |   | $       | 12,631  | 
|                                            | Leasing & services    |      |           | 10,734  |  |      |         | 11,441  |  |      |         | 9,630   |  |   |         | 9,594   |   |   |         | 9,765   | 
|                                           
|                                            |                       | $    | 22,939    |         |  | $    | 20,840  |         |  | $    | 18,711  |         |  | $ | 23,497  |         |   | $ | 22,396  |        
|                                           
|Ratio of earnings to fixed charges
    (3)  |                       |      | 3.55      |         |  |      | 2.84    |         |  |      | 1.52    |         |  |   | (0.86   | )       |   |   | 1.29    |        



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Consists of a reduction in loss contingency associated with the
    settlement of litigation relating to the logistics business that
    was discontinued in 1998. See Note 4 to the Consolidated
    Financial Statements.                                                                                                                                                                                                                                                                                                                                                                                              
|(2) | Includes $11.5 million (net of tax) of special charges,
    which principally relate to restructuring and write-down of
    European operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(3) | The ratio of earnings to fixed charges is computed by dividing
    earnings before fixed charges by fixed charges. Earnings before
    fixed charges consist of earnings (loss) before income tax,
    minority interest and equity in unconsolidated subsidiaries,
    plus fixed charges. Fixed charges consist of interest expensed,
    amortization of debt issuance costs and the portion of rental
    expense that we believe is representative of the interest
    component of lease expense. For the year ended August 31,
    2002, there was a deficiency of earnings to fixed charges of
    $47.2 million.





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##### Table of Contents






Item 7.       MANAGEMENTS
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS


Executive Summary






















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Greenbrier Companies 2005 Annual Report




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##### Table of Contents







3 8




Results of Operations


Overview




Manufacturing Segment














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Greenbrier Companies 2005 Annual Report




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##### Table of Contents





Leasing & Services
Segment














Other costs












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Greenbrier Companies 2005 Annual Report




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##### Table of Contents





Income Tax




Equity in Loss of Unconsolidated
Subsidiaries




Liquidity and Capital
Resources


















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Greenbrier Companies 2005 Annual Report




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##### Table of Contents

























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Greenbrier Companies 2005 Annual Report




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##### Table of Contents



(1)


|                             |  |             |         |      |  |      |         |      |  |      |        |      |  |            |        |  |  |   |        |  |  |   |        |  |  |   |         | 
|---------------------------- |  | ----------- | ------- | ---- |  | ---- | ------- | ---- |  | ---- | ------ | ---- |  | ---------- | ------ |  |  | - | ------ |  |  | - | ------ |  |  | - | ------- | 
|                             |  | Year Ending
|                             |  |            
|(In thousands)               |  | Total       |         | 2006 |  | 2007 |         | 2008 |  | 2009 |        | 2010 |  | Thereafter
|                            
|Notes payable                |  | $           | 214,635 |      |  | $    | 13,144  |      |  | $    | 4,467  |      |  | $          | 3,925  |  |  | $ | 4,113  |  |  | $ | 5,243  |  |  | $ | 183,743 | 
|Interest                     |  |             | 154,314 |      |  |      | 17,119  |      |  |      | 16,130 |      |  |            | 15,871 |  |  |   | 15,615 |  |  |   | 15,315 |  |  |   | 74,264  | 
|Purchase commitments
    (2) |  |             | 93,965  |      |  |      | 68,005  |      |  |      | 25,960 |      |  |            |       |  |  |   |       |  |  |   |       |  |  |   |        | 
|Operating leases             |  |             | 12,469  |      |  |      | 3,672   |      |  |      | 2,887  |      |  |            | 2,181  |  |  |   | 1,814  |  |  |   | 790    |  |  |   | 1,125   | 
|Participation                |  |             | 24,833  |      |  |      | 12,074  |      |  |      | 9,060  |      |  |            | 3,380  |  |  |   | 226    |  |  |   | 46     |  |  |   | 47      | 
|Railcar leases               |  |             | 13,875  |      |  |      | 5,598   |      |  |      | 3,631  |      |  |            | 2,409  |  |  |   | 1,580  |  |  |   | 607    |  |  |   | 50      | 
|Revolving notes              |  |             | 12,453  |      |  |      | 12,453  |      |  |      |       |      |  |            |       |  |  |   |       |  |  |   |       |  |  |   |        | 
|                            
|                             |  | $           | 526,544 |      |  | $    | 132,065 |      |  | $    | 62,135 |      |  | $          | 27,766 |  |  | $ | 23,348 |  |  | $ | 22,001 |  |  | $ | 259,229 | 
|                            

|    |                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------
|(1) | Subordinated debt is not included as any amounts due are retired
    from the sales proceeds of the related railcars.
|(2) | Purchase commitments consist of obligations for railcar
    purchases.                                               



Off Balance Sheet
Arrangements




Critical Accounting
Policies




Income taxes


Maintenance obligations






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Warranty accruals




Prospective Accounting
Changes


Share Based Payment.


Accounting Changes and Error Corrections Accounting Changes Reporting
Accounting Changes in Interim Financial Statements.





Item 7a.       QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


Foreign Currency Exchange
Risk






Interest Rate Risk








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Item 8.          FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA


Consolidated Balance
Sheets




|                                         |                                                                                                                              |      |         |         |   |   |         |         |  
|---------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------- | ---- | ------- | ------- | - | - | ------- | ------- | -
|(In thousands, except per share amounts) |                                                                                                                              | 2005 |         | 2004   
|                                        
|Assets                                   |                                                                                                                              |      |         |         |   |   |         |        
|                                         | Cash and cash equivalents                                                                                                    |      | $       | 73,204  |   |   | $       | 12,110  |  
|                                         | Restricted cash                                                                                                              |      |         | 93      |   |   |         | 1,085   |  
|                                         | Accounts and notes receivable                                                                                                |      |         | 122,957 |   |   |         | 120,007 |  
|                                         | Inventories                                                                                                                  |      |         | 121,698 |   |   |         | 92,969  |  
|                                         | Railcars held for sale                                                                                                       |      |         | 59,421  |   |   |         | 20,153  |  
|                                         | Investment in direct finance leases                                                                                          |      |         | 9,974   |   |   |         | 21,244  |  
|                                         | Equipment on operating leases                                                                                                |      |         | 183,155 |   |   |         | 162,258 |  
|                                         | Property, plant and equipment                                                                                                |      |         | 73,203  |   |   |         | 56,415  |  
|                                         | Other                                                                                                                        |      |         | 27,502  |   |   |         | 22,512  |  
|                                        
|                                         |                                                                                                                              | $    | 671,207 |         |   | $ | 508,753 |        
|                                        
|Liabilities and
    Stockholders Equity |                                                                                                                              |      |         |         |   |   |         |        
|                                         | Revolving notes                                                                                                              |      | $       | 12,453  |   |   | $       | 8,947   |  
|                                         | Accounts payable and accrued liabilities                                                                                     |      |         | 195,258 |   |   |         | 178,550 |  
|                                         | Participation                                                                                                                |      |         | 21,900  |   |   |         | 37,107  |  
|                                         | Deferred income tax                                                                                                          |      |         | 31,629  |   |   |         | 26,109  |  
|                                         | Deferred revenue                                                                                                             |      |         | 6,910   |   |   |         | 2,550   |  
|                                         | Notes payable                                                                                                                |      |         | 214,635 |   |   |         | 97,513  |  
|                                         | Subordinated debt                                                                                                            |      |         | 8,617   |   |   |         | 14,942  |  
|                                         | Subsidiary shares subject to mandatory redemption                                                                            |      |         | 3,746   |   |   |         | 3,746   |  
|                                         | Commitments and contingencies (Notes 25 & 26)                                                                                |      |         |        |   |   |         |        |  
|                                         | Stockholders equity:                                                                                                        |      |         |         |   |   |         |         |  
|                                         | Preferred stock - $0.001 par value; 25,000 shares
    authorized; none outstanding                                           |      |         |        |   |   |         |        |  
|                                         | Common stock - $0.001 par value; 50,000 shares authorized;
    15,479 and 14,884 outstanding at August 31, 2005 and
    2004 |      |         | 15      |   |   |         | 15      |  
|                                         | Additional paid-in capital                                                                                                   |      |         | 62,768  |   |   |         | 57,165  |  
|                                         | Retained earnings                                                                                                            |      |         | 113,987 |   |   |         | 88,054  |  
|                                         | Accumulated other comprehensive loss                                                                                         |      |         | (711    | ) |   |         | (5,945  | )
|                                        
|                                         |                                                                                                                              |      | 176,059 |         |   |   | 139,289 |        
|                                        
|                                         |                                                                                                                              | $    | 671,207 |         |   | $ | 508,753 |        
|                                        







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##### Table of Contents



Consolidated Statements of
Operations




|                                                                         |                                    |      |           |         |  |      |         |         |  |   |         |         | 
|------------------------------------------------------------------------ | ---------------------------------- | ---- | --------- | ------- |  | ---- | ------- | ------- |  | - | ------- | ------- | 
|(In thousands, except per share amounts)                                 |                                    | 2005 |           | 2004    |  | 2003
|                                                                        
|Revenue                                                                  |                                    |      |           |         |  |      |         |         |  |   |         |        
|                                                                         | Manufacturing                      |      | $         | 941,161 |  |      | $       | 653,234 |  |   | $       | 461,882 | 
|                                                                         | Leasing & services                 |      |           | 83,061  |  |      |         | 76,217  |  |   |         | 70,443  | 
|                                                                        
|                                                                         |                                    |      | 1,024,222 |         |  |      | 729,451 |         |  |   | 532,325 |        
|Cost of revenue                                                          |                                    |      |           |         |  |      |         |         |  |   |         |        
|                                                                         | Manufacturing                      |      |           | 857,950 |  |      |         | 595,026 |  |   |         | 424,378 | 
|                                                                         | Leasing & services                 |      |           | 41,099  |  |      |         | 42,241  |  |   |         | 43,609  | 
|                                                                        
|                                                                         |                                    |      | 899,049   |         |  |      | 637,267 |         |  |   | 467,987 |        
|Margin                                                                   |                                    |      | 125,173   |         |  |      | 92,184  |         |  |   | 64,338  |        
|Other costs                                                              |                                    |      |           |         |  |      |         |         |  |   |         |        
|                                                                         | Selling and administrative expense |      |           | 57,425  |  |      |         | 48,288  |  |   |         | 39,962  | 
|                                                                         | Interest and foreign exchange      |      |           | 14,835  |  |      |         | 11,468  |  |   |         | 13,618  | 
|                                                                         | Special charges                    |      |           | 2,913   |  |      |         | 1,234   |  |   |         |        | 
|                                                                        
|                                                                         |                                    |      | 75,173    |         |  |      | 60,990  |         |  |   | 53,580  |        
|Earnings before income tax and equity in unconsolidated
    subsidiaries |                                    |      | 50,000    |         |  |      | 31,194  |         |  |   | 10,758  |        
|Income tax expense                                                       |                                    |      | (19,911   | )       |  |      | (9,119  | )       |  |   | (4,543  | )      
|                                                                        
|Earnings before equity in unconsolidated subsidiaries                    |                                    |      | 30,089    |         |  |      | 22,075  |         |  |   | 6,215   |        
|Equity in loss of unconsolidated subsidiaries                            |                                    |      | (267      | )       |  |      | (2,036  | )       |  |   | (1,898  | )      
|                                                                        
|Earnings from continuing operations                                      |                                    |      | 29,822    |         |  |      | 20,039  |         |  |   | 4,317   |        
|                                                                        
|Earnings from discontinued operations (net of tax)                       |                                    |      |          |         |  |      | 739     |         |  |   |        |        
|                                                                        
|Net earnings                                                             |                                    | $    | 29,822    |         |  | $    | 20,778  |         |  | $ | 4,317   |        
|                                                                        
|Basic earnings per common
    share:                                     |                                    |      |           |         |  |      |         |         |  |   |         |        
|                                                                         | Continuing operations              |      | $         | 1.99    |  |      | $       | 1.38    |  |   | $       | 0.31    | 
|                                                                         | Discontinued operations            |      |           |        |  |      |         | 0.05    |  |   |         |        | 
|                                                                        
|                                                                         |                                    | $    | 1.99      |         |  | $    | 1.43    |         |  | $ | 0.31    |        
|                                                                        
|Diluted earnings per common
    share:                                   |                                    |      |           |         |  |      |         |         |  |   |         |        
|                                                                         | Continuing operations              |      | $         | 1.92    |  |      | $       | 1.32    |  |   | $       | 0.30    | 
|                                                                         | Discontinued operations            |      |           |        |  |      |         | 0.05    |  |   |         |        | 
|                                                                        
|                                                                         |                                    | $    | 1.92      |         |  | $    | 1.37    |         |  | $ | 0.30    |        
|                                                                        
|Weighted average common
    shares:                                      |                                    |      |           |         |  |      |         |         |  |   |         |        
|                                                                         | Basic                              |      |           | 15,000  |  |      |         | 14,569  |  |   |         | 14,138  | 
|                                                                         | Diluted                            |      |           | 15,560  |  |      |         | 15,199  |  |   |         | 14,325  | 







22                                        The
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##### Table of Contents



Consolidated Statements of
Stockholders Equity


and Comprehensive Income
(Loss)


|                                                                                                        |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   |          |  
|------------------------------------------------------------------------------------------------------- |  | ------------ | ------ | ---------- |  | -------- | -- | ------------- |  | ------------- | -------- | ------ |  | - | ------- | - |  | - | ------ | - |  | - | -------- | -
|                                                                                                        |  |              |        |            |  |          |    |               |  | Accumulated   |          |       
|                                                                                                        |  |              |        | Additional |  |          |    | Other         |  | Total        
|(In thousands, except per share                                                                         |  | Common Stock |        | Paid-in    |  | Retained |    | Comprehensive |  | Stockholders
|amounts)                                                                                                |  | Shares       |        | Amount     |  | Capital  |    | Earnings      |  | Income (Loss) |          | Equity
|                                                                                                       
|Balance September 1,
    2002                                                                           |  |              | 14,121 |            |  | $        | 14 |               |  | $             | 49,276   |        |  | $ | 63,848  |   |  | $ | (9,999 | ) |  | $ | 103,139  |  
|Translation adjustment (net of tax effect)                                                              |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | (699   | ) |  |   | (699     | )
|Reclassification of derivative financial instruments recognized
    in net earnings (net of tax effect) |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | (2,071 | ) |  |   | (2,071   | )
|Unrealized gain on derivative financial instruments (net of tax
    effect)                             |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | 4,659  |   |  |   | 4,659    |  
|                                                                                                        |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   |          |  
|Comprehensive income                                                                                    |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   | 6,206    |  
|Stock options exercised                                                                                 |  |              | 191    |            |  |          |   |               |  |               | 1,797    |        |  |   |        |   |  |   |       |   |  |   | 1,797    |  
|                                                                                                       
|Balance August 31,
    2003                                                                             |  |              | 14,312 |            |  |          | 14 |               |  |               | 51,073   |        |  |   | 68,165  |   |  |   | (8,110 | ) |  |   | 111,142  |  
|Net earnings                                                                                            |  |              |       |            |  |          |   |               |  |               |         |        |  |   | 20,778  |   |  |   |       |   |  |   | 20,778   |  
|Translation adjustment (net of tax effect)                                                              |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | 444    |   |  |   | 444      |  
|Reclassification of derivative financial instruments recognized
    in net earnings (net of tax effect) |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | (3,865 | ) |  |   | (3,865   | )
|Unrealized gain on derivative financial instruments (net of tax
    effect)                             |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | 5,586  |   |  |   | 5,586    |  
|                                                                                                        |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   |          |  
|Comprehensive income                                                                                    |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   | 22,943   |  
|Cash dividends ($0.06 per share)                                                                        |  |              |       |            |  |          |   |               |  |               |         |        |  |   | (889    | ) |  |   |       |   |  |   | (889     | )
|Stock options exercised                                                                                 |  |              | 572    |            |  |          | 1  |               |  |               | 6,092    |        |  |   |        |   |  |   |       |   |  |   | 6,093    |  
|                                                                                                       
|Balance August 31,
    2004                                                                             |  |              | 14,884 |            |  |          | 15 |               |  |               | 57,165   |        |  |   | 88,054  |   |  |   | (5,945 | ) |  |   | 139,289  |  
|Net earnings                                                                                            |  |              |       |            |  |          |   |               |  |               |         |        |  |   | 29,822  |   |  |   |       |   |  |   | 29,822   |  
|Translation adjustment (net of tax effect)                                                              |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | 2,653  |   |  |   | 2,653    |  
|Reclassification of derivative financial instruments recognized
    in net earnings (net of tax effect) |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | (2,355 | ) |  |   | (2,355   | )
|Unrealized gain on derivative financial instruments (net of tax
    effect)                             |  |              |       |            |  |          |   |               |  |               |         |        |  |   |        |   |  |   | 4,936  |   |  |   | 4,936    |  
|                                                                                                        |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   |          |  
|Comprehensive income                                                                                    |  |              |        |            |  |          |    |               |  |               |          |        |  |   |         |   |  |   |        |   |  |   | 35,056   |  
|Net proceeds from equity offering                                                                       |  |              | 5,175  |            |  |          | 5  |               |  |               | 127,457  |        |  |   |        |   |  |   |       |   |  |   | 127,462  |  
|Shares repurchased                                                                                      |  |              | (5,342 | )          |  |          | (5 | )             |  |               | (127,533 | )      |  |   |        |   |  |   |       |   |  |   | (127,538 | )
|Cash dividends ($0.26 per share)                                                                        |  |              |       |            |  |          |   |               |  |               |         |        |  |   | (3,889  | ) |  |   |       |   |  |   | (3,889   | )
|Restricted stock awards                                                                                 |  |              | 353    |            |  |          |   |               |  |               | 10,221   |        |  |   |        |   |  |   |       |   |  |   | 10,221   |  
|Unamortized restricted stock                                                                            |  |              |       |            |  |          |   |               |  |               | (9,980   | )      |  |   |        |   |  |   |       |   |  |   | (9,980   | )
|Stock options exercised                                                                                 |  |              | 409    |            |  |          |   |               |  |               | 3,045    |        |  |   |        |   |  |   |       |   |  |   | 3,045    |  
|Tax benefit of stock options exercised                                                                  |  |              |       |            |  |          |   |               |  |               | 2,393    |        |  |   |        |   |  |   |       |   |  |   | 2,393    |  
|                                                                                                       
|Balance August 31,
    2005                                                                             |  |              | 15,479 |            |  | $        | 15 |               |  | $             | 62,768   |        |  | $ | 113,987 |   |  | $ | (711   | ) |  | $ | 176,059  |  
|                                                                                                       







23                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents



Consolidated Statements of Cash
Flows




|                                                    |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |         |        |         |  
|--------------------------------------------------- | ------------------------------------------------------------------------------------------------- | -------------------------------------- | ---------------------------------------- | -------- | ------ | ------- | ------- | ------- | ------ | ------- | ------ | ------- | ------ | ------- | -
|(In thousands)                                      |                                                                                                   | 2005                                   |                                          | 2004     |        | 2003   
|                                                   
|Cash flows from operating
    activities:           |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |        
|                                                    | Net earnings                                                                                      |                                        | $                                        | 29,822   |        |         | $       | 20,778  |        |         | $      | 4,317   |       
|                                                    | Adjustments to reconcile net earnings to net cash provided by
    (used in) operating activities: |                                        |                                          |          |        |         |         |         |        |         |        |         |       
|                                                    |                                                                                                   | Earnings from discontinued operations  |                                          |          |       |         |         |         | (739   | )       |        |         |       |        
|                                                    |                                                                                                   | Deferred income taxes                  |                                          |          | 5,807  |         |         |         | 9,646  |         |        |         | 2,620  |        
|                                                    |                                                                                                   | Tax benefit of stock options exercised |                                          |          | 2,393  |         |         |         |       |         |        |         |       |        
|                                                    |                                                                                                   | Depreciation and amortization          |                                          |          | 22,939 |         |         |         | 20,840 |         |        |         | 18,711 |        
|                                                    |                                                                                                   | Gain on sales of equipment             |                                          |          | (6,797 | )       |         |         | (629   | )       |        |         | (454   | )      
|                                                    |                                                                                                   | Special charges                        |                                          |          |       |         |         |         | 1,234  |         |        |         |       |        
|                                                    |                                                                                                   | Other                                  |                                          |          | 651    |         |         |         | 1,332  |         |        |         | 661    |        
|                                                    |                                                                                                   | Decrease (increase) in assets:         |                                          |          |        |         |         |         |        |         |        |         |        |        
|                                                    |                                                                                                   |                                        | Accounts and notes receivable            |          |        | (32,328 | )       |         |        | (37,786 | )      |         |        | (24,786 | )
|                                                    |                                                                                                   |                                        | Inventories                              |          |        | 15,403  |         |         |        | (22,355 | )      |         |        | (10,275 | )
|                                                    |                                                                                                   |                                        | Railcars held for sale                   |          |        | (38,495 | )       |         |        | 14,097  |        |         |        | 3,377   |  
|                                                    |                                                                                                   |                                        | Other                                    |          |        | (10,415 | )       |         |        | 2,940   |        |         |        | 1,148   |  
|                                                    |                                                                                                   | Increase (decrease) in liabilities:    |                                          |          |        |         |         |         |        |         |        |         |        |        
|                                                    |                                                                                                   |                                        | Accounts payable and accrued liabilities |          |        | 3       |         |         |        | 30,956  |        |         |        | 30,843  |  
|                                                    |                                                                                                   |                                        | Participation                            |          |        | (15,207 | )       |         |        | (18,794 | )      |         |        | (5,094  | )
|                                                    |                                                                                                   |                                        | Deferred revenue                         |          |        | 4,285   |         |         |        | (37,495 | )      |         |        | 6,371   |  
|                                                   
|                                                    | Net cash provided by (used in) operating activities                                               |                                        |                                          | (21,939  | )      |         |         | (15,975 | )      |         |        | 27,439  |       
|                                                   
|Cash flows from investing
    activities:           |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |        
|                                                    | Principal payments received under direct finance leases                                           |                                        |                                          | 5,733    |        |         |         | 9,461   |        |         |        | 14,294  |       
|                                                    | Proceeds from sales of equipment                                                                  |                                        |                                          | 32,528   |        |         |         | 16,217  |        |         |        | 23,954  |       
|                                                    | Investment in and advances to unconsolidated subsidiaries                                         |                                        |                                          | 92       |        |         |         | (2,240  | )      |         |        | (3,126  | )     
|                                                    | Acquisition of joint venture                                                                      |                                        |                                          | 8,435    |        |         |         |        |        |         |        |        |       
|                                                    | Decrease (increase) in restricted cash                                                            |                                        |                                          | 1,007    |        |         |         | 4,757   |        |         |        | (5,300  | )     
|                                                    | Capital expenditures                                                                              |                                        |                                          | (69,123  | )      |         |         | (42,959 | )      |         |        | (11,895 | )     
|                                                   
|                                                    | Net cash provided by (used in) investing activities                                               |                                        |                                          | (21,328  | )      |         |         | (14,764 | )      |         |        | 17,927  |       
|                                                   
|Cash flows from financing
    activities:           |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |        
|                                                    | Changes in revolving notes                                                                        |                                        |                                          | 2,514    |        |         |         | (14,030 | )      |         |        | (5,754  | )     
|                                                    | Proceeds from notes payable                                                                       |                                        |                                          | 175,000  |        |         |         |        |        |         |        | 6,348   |       
|                                                    | Repayments of notes payable                                                                       |                                        |                                          | (67,691  | )      |         |         | (21,539 | )      |         |        | (34,058 | )     
|                                                    | Repayments of subordinated debt                                                                   |                                        |                                          | (6,325   | )      |         |         | (5,979  | )      |         |        | (6,148  | )     
|                                                    | Dividends                                                                                         |                                        |                                          | (3,889   | )      |         |         | (889    | )      |         |        |        |       
|                                                    | Net proceeds from equity offering                                                                 |                                        |                                          | 127,462  |        |         |         |        |        |         |        |        |       
|                                                    | Re-purchase and retirement of stock                                                               |                                        |                                          | (127,538 | )      |         |         |        |        |         |        |        |       
|                                                    | Stock options exercised and restricted stock awards                                               |                                        |                                          | 3,286    |        |         |         | 6,093   |        |         |        | 1,797   |       
|                                                    | Purchase subsidiarys shares subject to mandatory redemption                                      |                                        |                                          |         |        |         |         | (1,277  | )      |         |        |        |       
|                                                   
|                                                    | Net cash provided by (used in) financing activities                                               |                                        |                                          | 102,819  |        |         |         | (37,621 | )      |         |        | (37,815 | )     
|                                                   
|                                                    | Effect of exchange rate changes                                                                   |                                        |                                          | 1,542    |        |         |         | 3,172   |        |         |        | 2,151   |       
|Increase (decrease) in cash and cash equivalents    |                                                                                                   |                                        | 61,094                                   |          |        |         | (65,188 | )       |        |         | 9,702  |        
|Cash and cash
    equivalents                       |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |        
|Beginning of period                                 |                                                                                                   |                                        | 12,110                                   |          |        |         | 77,298  |         |        |         | 67,596 |        
|                                                   
|End of period                                       |                                                                                                   | $                                      | 73,204                                   |          |        | $       | 12,110  |         |        | $       | 77,298 |        
|                                                   
|Cash paid during the period
    for:                |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |        
|Interest                                            |                                                                                                   | $                                      | 10,187                                   |          |        | $       | 11,376  |         |        | $       | 13,789 |        
|Income taxes                                        |                                                                                                   | $                                      | 12,287                                   |          |        | $       | 5,892   |         |        | $       | 3,723  |        
|Supplemental disclosure of
    subsidiary acquired: |                                                                                                   |                                        |                                          |          |        |         |         |         |        |         |        |        
|                                                    | Assets acquired, net of cash                                                                      |                                        | $                                        | (19,051  | )      |         | $       |        |        |         | $      |        |       
|                                                    | Liabilities assumed                                                                               |                                        |                                          | 19,529   |        |         |         |        |        |         |        |        |       
|                                                    | Investment previously booked for unconsolidated joint venture                                     |                                        |                                          | 7,957    |        |         |         |        |        |         |        |        |       
|                                                   
|                                                    | Cash acquired                                                                                     |                                        | $                                        | 8,435    |        |         | $       |        |        |         | $      |        |       
|                                                   







24                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents



Notes to Consolidated Financial
Statements


Note 1 - Nature of
Operations




Note 2 - Summary of
Significant Accounting Policies


Principles of consolidation


Unclassified Balance Sheet


Foreign currency translation


Cash and cash equivalents


Accounts Receivable


Inventories


Railcars held for sale


Equipment on operating leases


Property, plant and equipment


|                            |  |                  |             | 
|--------------------------- |  | ---------------- | ----------- | 
|                            |  | Depreciable Life |            
|                            |  |                  |            
|Buildings and improvements: |  |                  | 10-25 years | 
|Machinery and equipment     |  |                  | 3-15 years  | 
|Other                       |  |                  | 3-7 years   | 

Intangible assets


Impairment of long-lived assets






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##### Table of Contents





Maintenance obligations


Warranty accruals


Contingent rental assistance


Income taxes


Accumulated other comprehensive income (loss)


Revenue recognition




Research and development






26                                        The
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##### Table of Contents



Forward exchange contracts


Interest rate instruments


Net earnings per share


Stock-based compensation Accounting for Stock Issued
to Employees




|                                                                                                                               |             |      |        |      |  |      |        |      |  |   |       |      | 
|------------------------------------------------------------------------------------------------------------------------------ | ----------- | ---- | ------ | ---- |  | ---- | ------ | ---- |  | - | ----- | ---- | 
|(In thousands, except per share amounts)                                                                                       |             | 2005 |        | 2004 |  | 2003
|                                                                                                                              
|Net earnings, as reported                                                                                                      |             | $    | 29,822 |      |  | $    | 20,778 |      |  | $ | 4,317 |     
|Total stock-based employee compensation expense determined under
    fair value based method for all awards, net of
    tax(1) |             |      | (235   | )    |  |      | (319   | )    |  |   | (690  | )   
|                                                                                                                              
|Net earnings, pro forma                                                                                                        |             | $    | 29,587 |      |  | $    | 20,459 |      |  | $ | 3,627 |     
|                                                                                                                              
|Basic earnings per share                                                                                                       |             |      |        |      |  |      |        |      |  |   |       |     
|                                                                                                                               | As reported |      | $      | 1.99 |  |      | $      | 1.43 |  |   | $     | 0.31 | 
|                                                                                                                              
|                                                                                                                               | Pro forma   |      | $      | 1.97 |  |      | $      | 1.40 |  |   | $     | 0.26 | 
|                                                                                                                              
|Diluted earnings per share                                                                                                     |             |      |        |      |  |      |        |      |  |   |       |     
|                                                                                                                               | As reported |      | $      | 1.92 |  |      | $      | 1.37 |  |   | $     | 0.30 | 
|                                                                                                                              
|                                                                                                                               | Pro forma   |      | $      | 1.90 |  |      | $      | 1.35 |  |   | $     | 0.25 | 
|                                                                                                                              

|    |                                                                                                                                                                                                                              
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Compensation expense was determined using the
    Black-Scholes-Merton option-pricing model which was developed to
    estimate value of independently traded options.
    Greenbriers options are not independently traded.





27                                        The
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##### Table of Contents





|                                               |  |      |       |  
|---------------------------------------------- |  | ---- | ----- | -
|                                               |  | 2003
|                                              
|Weighted average fair value of options granted |  | $    | 1.97  |  
|Volatility                                     |  |      | 31.68 | %
|Risk-free rate of return                       |  |      | 3.69  | %
|Dividend yield                                 |  |      | None  |  
|Number of years to exercise options            |  |      | 8     |  



Management estimates


Reclassifications


Prospective Accounting Changes Share Based Payment


Accounting Changes and Error Corrections Accounting Changes


Note 3 -
Acquisitions






|                                         |                                          |   |        |        | 
|---------------------------------------- | ---------------------------------------- | - | ------ | ------ | 
|(In thousands)                           |                                          |  
|                                        
|Assets                                   |                                          |   |        |       
|                                         | Cash and cash equivalents                |   | $      | 8,435  | 
|                                         | Amounts and notes receivable             |   |        | 12,712 | 
|                                         | Inventories                              |   |        | 38,593 | 
|                                         | Property, plant and equipment            |   |        | 11,515 | 
|                                         | Goodwill and other                       |   |        | 1,421  | 
|                                        
|                                         |                                          | $ | 72,676 |       
|                                        
|Liabilities and
    Stockholders Equity |                                          |   |        |       
|                                         | Accounts payable and accrued liabilities |   | $      | 10,530 | 
|                                         | Payable to Greenbrier                    |   |        | 45,053 | 
|                                         | Notes payable                            |   |        | 9,000  | 
|                                         | Stockholders equity                     |   |        | 8,093  | 
|                                        
|                                         |                                          | $ | 72,676 |       
|                                        





28                                        The
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##### Table of Contents





|                           |  |      |           |      |  |      |         |  |  |   |         | 
|-------------------------- |  | ---- | --------- | ---- |  | ---- | ------- |  |  | - | ------- | 
|(In thousands)             |  | 2005 |           | 2004 |  | 2003
|                          
|Revenue                    |  | $    | 1,052,914 |      |  | $    | 793,775 |  |  | $ | 557,943 | 
|Net earnings               |  | $    | 28,633    |      |  | $    | 18,119  |  |  | $ | 1,656   | 
|Basic earnings per share   |  | $    | 1.91      |      |  | $    | 1.24    |  |  | $ | 0.12    | 
|Diluted earnings per share |  | $    | 1.84      |      |  | $    | 1.19    |  |  | $ | 0.12    | 



Note 4 - Discontinued
Operations




Note 5 - Special
Charges






Note 6 - Accounts and
Notes Receivable


|                                                      |  |      |         |      |  |   |         |  
|----------------------------------------------------- |  | ---- | ------- | ---- |  | - | ------- | -
|(In thousands)                                        |  | 2005 |         | 2004
|                                                     
|Trade receivables                                     |  | $    | 123,294 |      |  | $ | 80,475  |  
|                                                     
|Receivables from unconsolidated subsidiaries          |  |      |        |      |  |   | 35,739  |  
|                                                     
|Long-term receivable from unconsolidated subsidiaries |  |      | 2,202   |      |  |   | 5,739   |  
|                                                     
|Allowance for doubtful accounts                       |  |      | (2,539  | )    |  |   | (1,946  | )
|                                                     
|                                                      |  | $    | 122,957 |      |  | $ | 120,007 |  
|                                                     



Note 7 -
Inventories


|                                         |  |      |         |      |  |   |        |  
|---------------------------------------- |  | ---- | ------- | ---- |  | - | ------ | -
|(In thousands)                           |  | 2005 |         | 2004
|                                        
|Manufacturing supplies and raw materials |  | $    | 33,653  |      |  | $ | 31,282 |  
|                                        
|Work-in process                          |  |      | 91,637  |      |  |   | 65,498 |  
|                                        
|Lower of cost or market adjustment       |  |      | (3,592  | )    |  |   | (3,811 | )
|                                        
|                                         |  | $    | 121,698 |      |  | $ | 92,969 |  
|                                        





29                                        The
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##### Table of Contents



|                                       |  |      |        |      |  |      |        |   |  |   |        |  
|-------------------------------------- |  | ---- | ------ | ---- |  | ---- | ------ | - |  | - | ------ | -
|(In thousands)                         |  | 2005 |        | 2004 |  | 2003
|                                      
|Lower of cost or market
    adjustment |  |      |        |      |  |      |        |   |  |   |        |  
|Balance at beginning of period         |  | $    | 3,811  |      |  | $    | 3,268  |   |  | $ | 2,226  |  
|Charged to cost of revenue             |  |      | 1,398  |      |  |      | 1,617  |   |  |   | 3,143  |  
|Usage                                  |  |      | (2,055 | )    |  |      | (1,238 | ) |  |   | (2,403 | )
|Currency translation effect            |  |      | 258    |      |  |      | 164    |   |  |   | 302    |  
|Acquisition                            |  |      | 180    |      |  |      |       |   |  |   |       |  
|                                      
|Balance at end of period               |  | $    | 3,592  |      |  | $    | 3,811  |   |  | $ | 3,268  |  
|                                      

Note 8 - Investment in
Direct Finance Leases


|                                           |  |      |        |      |  |   |        |  
|------------------------------------------ |  | ---- | ------ | ---- |  | - | ------ | -
|                                           |  | 2005 |        | 2004
|(In thousands)                             |  |      |        |     
|                                          
|Future minimum receipts on lease contracts |  | $    | 8,394  |      |  | $ | 14,869 |  
|Maintenance, insurance and taxes           |  |      | (1,037 | )    |  |   | (3,763 | )
|                                          
|Net minimum lease receipts                 |  |      | 7,357  |      |  |   | 11,106 |  
|Estimated residual values                  |  |      | 5,899  |      |  |   | 13,213 |  
|Unearned finance charges                   |  |      | (3,282 | )    |  |   | (3,075 | )
|                                          
|                                           |  | $    | 9,974  |      |  | $ | 21,244 |  
|                                          



|                       |  |   |       | 
|---------------------- |  | - | ----- | 
|(In thousands)         |  |  
|                      
|Year ending August 31, |  |   |       | 
|2006                   |  | $ | 3,939 | 
|2007                   |  |   | 987   | 
|2008                   |  |   | 424   | 
|2009                   |  |   | 318   | 
|2010                   |  |   | 303   | 
|Thereafter             |  |   | 2,423 | 
|                      
|                       |  | $ | 8,394 | 
|                      

Note 9 - Equipment on
Operating Leases




|                       |  |   |         | 
|---------------------- |  | - | ------- | 
|(In thousands)         |  |  
|                      
|Year ending August 31, |  |   |         | 
|2006                   |  | $ | 21,578  | 
|2007                   |  |   | 17,351  | 
|2008                   |  |   | 15,059  | 
|2009                   |  |   | 9,379   | 
|2010                   |  |   | 7,832   | 
|Thereafter             |  |   | 31,103  | 
|                      
|                       |  | $ | 102,302 | 
|                      



Note 10 - Property,
Plant and Equipment


|                           |  |      |          |      |  |   |         |  
|-------------------------- |  | ---- | -------- | ---- |  | - | ------- | -
|(In thousands)             |  | 2005 |          | 2004
|                          
|Land and improvements      |  | $    | 9,824    |      |  | $ | 9,522   |  
|Machinery and equipment    |  |      | 105,910  |      |  |   | 84,563  |  
|Buildings and improvements |  |      | 55,973   |      |  |   | 42,606  |  
|Other                      |  |      | 16,430   |      |  |   | 11,828  |  
|                          
|                           |  |      | 188,137  |      |  |   | 148,519 |  
|Accumulated depreciation   |  |      | (114,934 | )    |  |   | (92,104 | )
|                          
|                           |  | $    | 73,203   |      |  | $ | 56,415  |  
|                          





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Note 11 - Investment
in Unconsolidated Subsidiaries






|                    |  |      |        |      |  |   |        | 
|------------------- |  | ---- | ------ | ---- |  | - | ------ | 
|(In thousands)      |  | 2005 |        | 2004
|                   
|Current assets      |  | $    | 17,135 |      |  | $ | 19,036 | 
|Total assets        |  | $    | 33,632 |      |  | $ | 32,946 | 
|Current liabilities |  | $    | 14,742 |      |  | $ | 19,994 | 
|Equity              |  | $    | 6,862  |      |  | $ | 4,919  | 

|                    |  |      |         |      |  |      |        |   |  |   |       |  
|------------------- |  | ---- | ------- | ---- |  | ---- | ------ | - |  | - | ----- | -
|(In thousands)      |  | 2005 |         | 2004 |  | 2003
|                   
|Revenue             |  | $    | 109,801 |      |  | $    | 55,722 |   |  | $ | 5,039 |  
|Net earnings (loss) |  | $    | 1,942   |      |  | $    | (4,154 | ) |  | $ | (224  | )





|                    |  |      |        | 
|------------------- |  | ---- | ------ | 
|(In thousands)      |  | 2004
|                   
|Current assets      |  | $    | 56,823 | 
|Total assets        |  | $    | 68,964 | 
|Current liabilities |  | $    | 51,203 | 
|Equity              |  | $    | 17,761 | 

|         |  |              |        |             |  |      |        |   |  |   |        |  
|-------- |  | ------------ | ------ | ----------- |  | ---- | ------ | - |  | - | ------ | -
|         |  | Three Months |        | Years Ended
|         |  | Ended        |        | August 31, 
|         |  | November 30, |        |            
|         |  | 2004         |        | 2004        |  | 2003
|         |  |             
|Revenue  |  | $            | 30,067 |             |  | $    | 75,565 |   |  | $ | 25,550 |  
|Net loss |  | $            | (1,576 | )           |  | $    | (2,956 | ) |  | $ | (4,728 | )



Note 12 - Revolving
Notes




Note 13 - Accounts
Payable and Accrued Liabilities


|                                        |  |      |         |      |  |   |         | 
|--------------------------------------- |  | ---- | ------- | ---- |  | - | ------- | 
|(In thousands)                          |  | 2005 |         | 2004
|                                       
|Trade payables and accrued liabilities  |  | $    | 129,499 |      |  | $ | 127,268 | 
|Accrued maintenance                     |  |      | 25,464  |      |  |   | 21,264  | 
|Accrued payroll and related liabilities |  |      | 17,292  |      |  |   | 14,011  | 
|Accrued warranty                        |  |      | 15,037  |      |  |   | 12,691  | 
|Other                                   |  |      | 7,966   |      |  |   | 3,316   | 
|                                       
|                                        |  | $    | 195,258 |      |  | $ | 178,550 | 
|                                       





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Note 14 - Maintenance
and Warranty Accruals


|                               |  |      |         |      |  |      |         |   |  |   |         |  
|------------------------------ |  | ---- | ------- | ---- |  | ---- | ------- | - |  | - | ------- | -
|(In thousands)                 |  | 2005 |         | 2004 |  | 2003
|                              
|Accrued maintenance            |  |      |         |      |  |      |         |   |  |   |         |  
|Balance at beginning of period |  | $    | 21,264  |      |  | $    | 18,155  |   |  | $ | 12,508  |  
|Charged to cost of revenue     |  |      | 20,152  |      |  |      | 19,968  |   |  |   | 20,941  |  
|Payments                       |  |      | (15,952 | )    |  |      | (16,859 | ) |  |   | (15,294 | )
|                              
|Balance at end of period       |  | $    | 25,464  |      |  | $    | 21,264  |   |  | $ | 18,155  |  
|                              
|Accrued warranty               |  |      |         |      |  |      |         |   |  |   |         |  
|Balance at beginning of period |  | $    | 12,691  |      |  | $    | 9,511   |   |  | $ | 9,556   |  
|Charged to cost of revenue     |  |      | 4,664   |      |  |      | 4,895   |   |  |   | 2,584   |  
|Payments                       |  |      | (3,297  | )    |  |      | (2,186  | ) |  |   | (3,263  | )
|Currency translation effect    |  |      | 811     |      |  |      | 471     |   |  |   | 634     |  
|Acquisition                    |  |      | 168     |      |  |      |        |   |  |   |        |  
|                              
|Balance at end of period       |  | $    | 15,037  |      |  | $    | 12,691  |   |  | $ | 9,511   |  
|                              

Note 15 -
Notes Payable


|                        |  |      |         |      |  |   |        | 
|----------------------- |  | ---- | ------- | ---- |  | - | ------ | 
|(In thousands)          |  | 2005 |         | 2004
|                       
|Senior unsecured notes  |  | $    | 175,000 |      |  | $ |       | 
|Term loans              |  |      | 39,479  |      |  |   | 45,943 | 
|Equipment notes payable |  |      |        |      |  |   | 51,199 | 
|Other notes payable     |  |      | 156     |      |  |   | 371    | 
|                       
|                        |  | $    | 214,635 |      |  | $ | 97,513 | 
|                       

3 8














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|                       |  |   |         | 
|---------------------- |  | - | ------- | 
|(In thousands)         |  |  
|                      
|Year ending August 31, |  |   |         | 
|2006                   |  | $ | 13,144  | 
|2007                   |  |   | 4,467   | 
|2008                   |  |   | 3,925   | 
|2009                   |  |   | 4,113   | 
|2010                   |  |   | 5,243   | 
|Thereafter             |  |   | 183,743 | 
|                      
|                       |  | $ | 214,635 | 
|                      

Note 16 - Subordinated
Debt




Note 17 - Derivative
Instruments








Note 18 -
Stockholders Equity












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of the Company. The 2000 Plan
authorized the grant of incentive stock options, non-statutory
stock options, and restricted stock awards, or any combination
of the foregoing. Under the 2000 Plan, the exercise price for
incentive stock options could not be less than the market value
of the Companys common stock at the time the option is
granted. Grants for 2,500 shares remain available under
this plan. In 2005, vesting was accelerated on all outstanding
options on this plan in an effort to reduce administrative
expenses associated with the implementation of FASB 123R as the
remaining unvested portion of options was immaterial and no
further options were expected to be issued. If the vesting of
the options had not been accelerated, the impact to the
Companys Statement of Operations would be an additional
expense of $0.1 million in 2006 with an after-tax impact of
$0.004 per share. The effect would be minimal for periods
after 2006.






|                             |  |        |           |          |  |   |       | 
|---------------------------- |  | ------ | --------- | -------- |  | - | ----- | 
|                             |  |        |           | Weighted
|                             |  |        |           | Average 
|                             |  |        |           | Option  
|                             |  | Shares |           | Price   
|                            
|Balance at September 1, 2002 |  |        | 1,273,500 |          |  | $ | 10.26 | 
|Granted                      |  |        | 429,500   |          |  |   | 4.45  | 
|Exercised                    |  |        | (190,800  | )        |  |   | 9.42  | 
|Expired                      |  |        | (3,000    | )        |  |   | 17.34 | 
|Canceled                     |  |        | (28,750   | )        |  |   | 10.44 | 
|                             |  |        |           |         
|Balance at August 31, 2003   |  |        | 1,480,450 |          |  |   | 8.66  | 
|Exercised                    |  |        | (592,200  | )        |  |   | 10.58 | 
|Expired                      |  |        | (4,000    | )        |  |   | 13.63 | 
|                             |  |        |           |         
|Balance at August 31, 2004   |  |        | 884,250   |          |  |   | 7.35  | 
|Exercised                    |  |        | (408,930  | )        |  |   | 7.48  | 
|Expired                      |  |        | (2,500    | )        |  |   | 8.75  | 
|                             |  |        |           |         
|Balance at August 31, 2005   |  |        | 472,820   |          |  | $ | 7.24  | 
|                             |  |        |           |         



Note 19 - Earnings Per
Share




|                                                   |  |      |        |      |  |      |        |  |  |  |        | 
|-------------------------------------------------- |  | ---- | ------ | ---- |  | ---- | ------ |  |  |  | ------ | 
|(In thousands)                                     |  | 2005 |        | 2004 |  | 2003
|                                                  
|Weighted average basic common shares outstanding   |  |      | 15,000 |      |  |      | 14,569 |  |  |  | 14,138 | 
|                                                  
|Dilutive effect of employee stock options          |  |      | 560    |      |  |      | 630    |  |  |  | 187    | 
|                                                  
|                                                  
|Weighted average diluted common shares outstanding |  |      | 15,560 |      |  |      | 15,199 |  |  |  | 14,325 | 
|                                                  



Note 20 - Related
Party Transactions


James-Furman & Company Partnership.






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Indebtedness of Management


Policy


Litigation


Purchases from unconsolidated subsidiaries


Note 21 - Employee
Benefit Plans










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Note 22 - Income
Taxes




|               |         |      |        |        |   |      |       |       |   |   |       |       |  
|-------------- | ------- | ---- | ------ | ------ | - | ---- | ----- | ----- | - | - | ----- | ----- | -
|(In thousands) |         | 2005 |        | 2004   |   | 2003
|              
|Current:       |         |      |        |        |   |      |       |       |   |   |       |      
|               | Federal |      | $      | 15,587 |   |      | $     | (35   | ) |   | $     | 2,810 |  
|               | State   |      |        | 1,213  |   |      |       | 215   |   |   |       | 167   |  
|               | Foreign |      |        | 328    |   |      |       | (347  | ) |   |       | (738  | )
|              
|               |         |      | 17,128 |        |   |      | (167  | )     |   |   | 2,239 |      
|Deferred:      |         |      |        |        |   |      |       |       |   |   |       |      
|               | Federal |      |        | (1,344 | ) |      |       | 7,437 |   |   |       | 1,453 |  
|               | State   |      |        | 2,084  |   |      |       | 1,481 |   |   |       | 1,103 |  
|               | Foreign |      |        | 2,043  |   |      |       | 368   |   |   |       | (252  | )
|              
|               |         |      | 2,783  |        |   |      | 9,286 |       |   |   | 2,304 |      
|              
|               |         | $    | 19,911 |        |   | $    | 9,119 |       |   | $ | 4,543 |      
|              



|                                           |  |      |      |      |  |      |       |   |  |  |      |  
|------------------------------------------ |  | ---- | ---- | ---- |  | ---- | ----- | - |  |  | ---- | -
|                                           |  | 2005 |      | 2004 |  | 2003
|                                          
|Federal statutory rate                     |  |      | 35.0 | %    |  |      | 35.0  | % |  |  | 35.0 | %
|                                          
|State income taxes, net of federal benefit |  |      | 4.3  |      |  |      | 3.5   |   |  |  | 7.0  |  
|                                          
|Impact of foreign operations               |  |      | (1.0 | )    |  |      | (10.0 | ) |  |  | .6   |  
|                                          
|Other                                      |  |      | 1.5  |      |  |      | .7    |   |  |  | (.4  | )
|                                          
|                                           |  |      | 39.8 | %    |  |      | 29.2  | % |  |  | 42.2 | %
|                                          



|                                                               |                                         |      |         |        |   |   |         |        |  
|-------------------------------------------------------------- | --------------------------------------- | ---- | ------- | ------ | - | - | ------- | ------ | -
|(In thousands)                                                 |                                         | 2005 |         | 2004  
|                                                              
|Deferred tax assets:                                           |                                         |      |         |        |   |   |         |       
|                                                               | Deferred participation                  |      | $       | (3,931 | ) |   | $       | (8,145 | )
|                                                               | Maintenance and warranty accruals       |      |         | (9,542 | ) |   |         | (8,326 | )
|                                                               | Accrued payroll and related liabilities |      |         | (5,568 | ) |   |         | (2,352 | )
|                                                               | Deferred revenue                        |      |         | (5,754 | ) |   |         | (5,364 | )
|                                                               | Inventories and other                   |      |         | (3,871 | ) |   |         | (5,656 | )
|                                                               | Investment tax credit                   |      |         | (1,061 | ) |   |         | (2,981 | )
|                                                               | SFAS 133 and translation adjustment     |      |         |       |   |   |         | (835   | )
|                                                              
|                                                               |                                         |      | (29,727 | )      |   |   | (33,659 | )     
|Deferred tax liabilities:                                      |                                         |      |         |        |   |   |         |       
|                                                               | Accelerated depreciation                |      |         | 57,439 |   |   |         | 58,724 |  
|                                                               | SFAS 133 and translation adjustment     |      |         | 1,902  |   |   |         |       |  
|                                                               | Other                                   |      |         | 2,015  |   |   |         | 2,584  |  
|                                                              
|Net deferred tax liability                                     |                                         |      | 31,629  |        |   |   | 27,649  |       
|Net deferred tax liability attributable to inactive operations |                                         |      |        |        |   |   | (1,540  | )     
|                                                              
|Net deferred tax liability                                     |                                         | $    | 31,629  |        |   | $ | 26,109  |       
|                                                              









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Note 23 - Segment
Information






|                               |                           |      |           |         |   |      |         |         |       |   |         |         |  
|------------------------------ | ------------------------- | ---- | --------- | ------- | - | ---- | ------- | ------- | ----- | - | ------- | ------- | -
|(In thousands)                 |                           | 2005 |           | 2004    |   | 2003
|                              
|Revenue:                       |                           |      |           |         |   |      |         |         |       |   |         |        
|                               | Manufacturing             |      | $         | 983,818 |   |      | $       | 644,927 |       |   | $       | 491,106 |  
|                               | Leasing & services        |      |           | 101,426 |   |      |         | 88,793  |       |   |         | 79,608  |  
|                               | Intersegment eliminations |      |           | (61,022 | ) |      |         | (4,269  | ) (1) |   |         | (38,389 | )
|                              
|                               |                           | $    | 1,024,222 |         |   | $    | 729,451 |         |       | $ | 532,325 |        
|                              
|Margin:                        |                           |      |           |         |   |      |         |         |       |   |         |        
|                               | Manufacturing             |      | $         | 83,211  |   |      | $       | 58,208  |       |   | $       | 37,504  |  
|                               | Leasing & services        |      |           | 41,962  |   |      |         | 33,976  |       |   |         | 26,834  |  
|                              
|                               |                           | $    | 125,173   |         |   | $    | 92,184  |         |       | $ | 64,338  |        
|                              
|Assets:                        |                           |      |           |         |   |      |         |         |       |   |         |        
|                               | Manufacturing             |      | $         | 298,730 |   |      | $       | 254,044 |       |   |         | 195,341 |  
|                               | Leasing & services        |      |           | 299,180 |   |      |         | 241,514 |       |   |         | 260,875 |  
|                               | Unallocated               |      |           | 73,297  |   |      |         | 13,195  |       |   |         | 82,732  |  
|                              
|                               |                           | $    | 671,207   |         |   | $    | 508,753 |         |       | $ | 538,948 |        
|                              
|Depreciation and amortization: |                           |      |           |         |   |      |         |         |       |   |         |        
|                               | Manufacturing             |      | $         | 12,205  |   |      | $       | 9,399   |       |   | $       | 9,081   |  
|                               | Leasing & services        |      |           | 10,734  |   |      |         | 11,441  |       |   |         | 9,630   |  
|                              
|                               |                           | $    | 22,939    |         |   | $    | 20,840  |         |       | $ | 18,711  |        
|                              
|Capital expenditures:          |                           |      |           |         |   |      |         |         |       |   |         |        
|                               | Manufacturing             |      | $         | 16,318  |   |      | $       | 7,161   |       |   | $       | 7,390   |  
|                               | Leasing & services        |      |           | 52,805  |   |      |         | 35,798  |       |   |         | 4,505   |  
|                              
|                               |                           | $    | 69,123    |         |   | $    | 42,959  |         |       | $ | 11,895  |        
|                              





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|                     |               |      |           |         |  |      |         |         |  |   |         |         | 
|-------------------- | ------------- | ---- | --------- | ------- |  | ---- | ------- | ------- |  | - | ------- | ------- | 
|(In thousands)       |               | 2005 |           | 2004    |  | 2003
|                    
|Revenue(2)           |               |      |           |         |  |      |         |         |  |   |         |        
|                    
|                     | United States |      | $         | 875,261 |  |      | $       | 558,152 |  |   | $       | 415,791 | 
|                    
|                     | Foreign       |      |           | 148,961 |  |      |         | 171,299 |  |   |         | 116,534 | 
|                    
|                     |               | $    | 1,024,222 |         |  | $    | 729,451 |         |  | $ | 532,325 |        
|                    
|Identifiable assets: |               |      |           |         |  |      |         |         |  |   |         |        
|                    
|                     | United States |      | $         | 516,690 |  |      | $       | 403,914 |  |   | $       | 446,966 | 
|                    
|                     | Canada        |      |           | 48,529  |  |      |         | 39,943  |  |   |         | 43,190  | 
|                    
|                     | Mexico        |      |           | 48,291  |  |      |         | 366     |  |   |         | 510     | 
|                    
|                     | Europe        |      |           | 57,697  |  |      |         | 64,530  |  |   |         | 48,282  | 
|                    
|                     |               | $    | 671,207   |         |  | $    | 508,753 |         |  | $ | 538,948 |        
|                    

|    |                                                                                                                                                                                                                          
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes $33.6 million in revenue associated with railcars
    produced in a prior period for which revenue recognition had
    been deferred pending removal of contractual contingencies that
    were removed in 2004.
|   
|(2) | Revenues are attributed to the county where the customer is
    located.                                                                                                                                                 





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Note 24 - Customer
Concentration




Note 25 - Lease
Commitments




|                       |  |   |        | 
|---------------------- |  | - | ------ | 
|(In thousands)         |  |  
|                      
|Year ending August 31, |  |   |        | 
|2006                   |  | $ | 5,598  | 
|2007                   |  |   | 3,631  | 
|2008                   |  |   | 2,409  | 
|2009                   |  |   | 1,580  | 
|2010                   |  |   | 607    | 
|Thereafter             |  |   | 50     | 
|                      
|                       |  | $ | 13,875 | 
|                      



|                       |  |   |        | 
|---------------------- |  | - | ------ | 
|(In thousands)         |  |  
|                      
|Year ending August 31, |  |   |        | 
|2006                   |  | $ | 3,672  | 
|2007                   |  |   | 2,887  | 
|2008                   |  |   | 2,181  | 
|2009                   |  |   | 1,814  | 
|2010                   |  |   | 790    | 
|Thereafter             |  |   | 1,125  | 
|                      
|                       |  | $ | 12,469 | 
|                      





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Note 26 - Commitments
and Contingencies




















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Note 27 - Fair Value
of Financial Instruments




|                                    |  |          |         |  |            |   |         | 
|----------------------------------- |  | -------- | ------- |  | ---------- | - | ------- | 
|                                    |  | 2005     |        
|                                    |  |          |        
|                                    |  | Carrying |         |  | Estimated  |  
|(In thousands)                      |  | Amount   |         |  | Fair Value |  
|                                    | 
|Notes payable and subordinated debt |  | $        | 223,252 |  |            | $ | 218,541 | 
|Deferred participation              |  |          | 9,826   |  |            |   | 8,780   | 

|                                    |  |          |         |  |            |   |         | 
|----------------------------------- |  | -------- | ------- |  | ---------- | - | ------- | 
|                                    |  | 2004     |        
|                                    |  |          |        
|                                    |  | Carrying |         |  | Estimated  |  
|(In thousands)                      |  | Amount   |         |  | Fair Value |  
|                                    | 
|Notes payable and subordinated debt |  | $        | 112,455 |  |            | $ | 119,124 | 
|Deferred participation              |  |          | 20,363  |  |            |   | 17,296  | 



Note 28 -
Guarantor/Non Guarantor










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|                                         |                                                   |        |         |              |  |              |         |              |   |              |        |        |   |   |          |          |   |   |         |         | 
|---------------------------------------- | ------------------------------------------------- | ------ | ------- | ------------ |  | ------------ | ------- | ------------ | - | ------------ | ------ | ------ | - | - | -------- | -------- | - | - | ------- | ------- | 
|                                         |                                                   |        |         |              |  | Combined     |         |              |   |             
|                                         |                                                   |        |         | Combined     |  | Non-         |         |              |   |             
|                                         |                                                   |        |         | Guarantor    |  | Guarantor    |         |              |   |             
|(In thousands)                           |                                                   | Parent |         | Subsidiaries |  | Subsidiaries |         | Eliminations |   | Consolidated
|                                        
|Assets                                   |                                                   |        |         |              |  |              |         |              |   |              |        |        |   |   |          |          |   |   |         |        
|                                         | Cash and cash equivalents                         |        | $       | 66,760       |  |              | $       | 2,053        |   |              | $      | 4,350  |   |   | $        | 41       |   |   | $       | 73,204  | 
|                                         | Restricted cash                                   |        |         |             |  |              |         |             |   |              |        | 93     |   |   |          |         |   |   |         | 93      | 
|                                         | Accounts and notes receivable                     |        |         | 27,325       |  |              |         | 75,762       |   |              |        | 19,827 |   |   |          | 43       |   |   |         | 122,957 | 
|                                         | Inventories                                       |        |         |             |  |              |         | 77,110       |   |              |        | 44,588 |   |   |          |         |   |   |         | 121,698 | 
|                                         | Railcars held for sale                            |        |         |             |  |              |         | 54,165       |   |              |        | 5,863  |   |   |          | (607     | ) |   |         | 59,421  | 
|                                         | Investment in direct finance leases               |        |         |             |  |              |         | 9,974        |   |              |        |       |   |   |          |         |   |   |         | 9,974   | 
|                                         | Equipment on operating leases                     |        |         |             |  |              |         | 185,104      |   |              |        |       |   |   |          | (1,949   | ) |   |         | 183,155 | 
|                                         | Property, plant and equipment                     |        |         | 8            |  |              |         | 51,381       |   |              |        | 21,814 |   |   |          |         |   |   |         | 73,203  | 
|                                         | Other                                             |        |         | 276,072      |  |              |         | 24,788       |   |              |        | 2,635  |   |   |          | (275,993 | ) |   |         | 27,502  | 
|                                        
|                                         |                                                   | $      | 370,165 |              |  | $            | 480,337 |              |   | $            | 99,170 |        |   | $ | (278,465 | )        |   | $ | 671,207 |        
|                                        
|                                        
|Liabilities and
    Stockholders Equity |                                                   |        |         |              |  |              |         |              |   |              |        |        |   |   |          |          |   |   |         |        
|                                         | Revolving notes                                   |        | $       |             |  |              | $       |             |   |              | $      | 12,453 |   |   | $        |         |   |   | $       | 12,453  | 
|                                         | Accounts payable and accrued liabilities          |        |         | 9,586        |  |              |         | 144,672      |   |              |        | 40,916 |   |   |          | 84       |   |   |         | 195,258 | 
|                                         | Participation                                     |        |         |             |  |              |         | 21,900       |   |              |        |       |   |   |          |         |   |   |         | 21,900  | 
|                                         | Deferred income tax                               |        |         | 952          |  |              |         | 31,560       |   |              |        | (484   | ) |   |          | (399     | ) |   |         | 31,629  | 
|                                         | Deferred revenue                                  |        |         | 1,396        |  |              |         | 5,387        |   |              |        | 127    |   |   |          |         |   |   |         | 6,910   | 
|                                         | Notes payable                                     |        |         | 183,072      |  |              |         | 17,772       |   |              |        | 13,791 |   |   |          |         |   |   |         | 214,635 | 
|                                         | Subordinated debt                                 |        |         |             |  |              |         | 8,617        |   |              |        |       |   |   |          |         |   |   |         | 8,617   | 
|                                         | Minority interest                                 |        |         |             |  |              |         | (111         | ) |              |        |       |   |   |          | 111      |   |   |         |        | 
|                                         | Subsidiary shares subject to mandatory redemption |        |         |             |  |              |         |             |   |              |        |       |   |   |          | 3,746    |   |   |         | 3,746   | 
|Stockholders
    Equity                 |                                                   |        | 175,159 |              |  |              | 250,540 |              |   |              | 32,367 |        |   |   | (282,007 | )        |   |   | 176,059 |        
|                                        
|                                         |                                                   | $      | 370,165 |              |  | $            | 480,337 |              |   | $            | 99,170 |        |   | $ | (278,465 | )        |   | $ | 671,207 |        
|                                        





44                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents









|                                                                                                                      |                                    |        |         |              |  |              |         |              |   |              |         |         |   |   |         |         |   |   |           |         |  
|--------------------------------------------------------------------------------------------------------------------- | ---------------------------------- | ------ | ------- | ------------ |  | ------------ | ------- | ------------ | - | ------------ | ------- | ------- | - | - | ------- | ------- | - | - | --------- | ------- | -
|                                                                                                                      |                                    |        |         |              |  | Combined     |         |              |   |             
|                                                                                                                      |                                    |        |         | Combined     |  | Non-         |         |              |   |             
|                                                                                                                      |                                    |        |         | Guarantor    |  | Guarantor    |         |              |   |             
|(In thousands)                                                                                                        |                                    | Parent |         | Subsidiaries |  | Subsidiaries |         | Eliminations |   | Consolidated
|                                                                                                                     
|Revenue                                                                                                               |                                    |        |         |              |  |              |         |              |   |              |         |         |   |   |         |         |   |   |           |        
|                                                                                                                      | Manufacturing                      |        | $       | 66,940       |  |              | $       | 549,216      |   |              | $       | 340,499 |   |   | $       | (15,494 | ) |   | $         | 941,161 |  
|                                                                                                                      | Leasing & services                 |        |         | 1,369        |  |              |         | 84,061       |   |              |         |        |   |   |         | (2,369  | ) |   |           | 83,061  |  
|                                                                                                                     
|                                                                                                                      |                                    |        | 68,309  |              |  |              | 633,277 |              |   |              | 340,499 |         |   |   | (17,863 | )       |   |   | 1,024,222 |        
|Cost of revenue                                                                                                       |                                    |        |         |              |  |              |         |              |   |              |         |         |   |   |         |         |   |   |           |        
|                                                                                                                      | Manufacturing                      |        |         | 62,535       |  |              |         | 488,906      |   |              |         | 321,213 |   |   |         | (14,704 | ) |   |           | 857,950 |  
|                                                                                                                      | Leasing & services                 |        |         |             |  |              |         | 41,168       |   |              |         |        |   |   |         | (69     | ) |   |           | 41,099  |  
|                                                                                                                     
|                                                                                                                      |                                    |        | 62,535  |              |  |              | 530,074 |              |   |              | 321,213 |         |   |   | (14,773 | )       |   |   | 899,049   |        
|                                                                                                                     
|Margin                                                                                                                |                                    |        | 5,774   |              |  |              | 103,203 |              |   |              | 19,286  |         |   |   | (3,090  | )       |   |   | 125,173   |        
|Other costs                                                                                                           |                                    |        |         |              |  |              |         |              |   |              |         |         |   |   |         |         |   |   |           |        
|                                                                                                                      | Selling and administrative expense |        |         | 14,260       |  |              |         | 33,893       |   |              |         | 9,272   |   |   |         |        |   |   |           | 57,425  |  
|                                                                                                                      | Interest and foreign exchange      |        |         | 7,405        |  |              |         | 6,770        |   |              |         | 3,576   |   |   |         | (2,916  | ) |   |           | 14,835  |  
|                                                                                                                      | Special charges                    |        |         |             |  |              |         | 2,913        |   |              |         |        |   |   |         |        |   |   |           | 2,913   |  
|                                                                                                                     
|                                                                                                                      |                                    |        | 21,665  |              |  |              | 43,576  |              |   |              | 12,848  |         |   |   | (2,916  | )       |   |   | 75,173    |        
|                                                                                                                     
|Earnings (loss) before income tax, minority interest and equity
    in earnings (loss) of unconsolidated subsidiaries |                                    |        | (15,891 | )            |  |              | 59,627  |              |   |              | 6,438   |         |   |   | (174    | )       |   |   | 50,000    |        
|                                                                                                                      | Income tax (expense) benefit       |        |         | 6,452        |  |              |         | (24,413      | ) |              |         | (2,027  | ) |   |         | 77      |   |   |           | (19,911 | )
|                                                                                                                     
|Earnings (loss) before minority interest and equity in
    unconsolidated subsidiaries                                |                                    |        | (9,439  | )            |  |              | 35,214  |              |   |              | 4,411   |         |   |   | (97     | )       |   |   | 30,089    |        
|Minority interest                                                                                                     |                                    |        |        |              |  |              | (25     | )            |   |              |        |         |   |   | 25      |         |   |   |          |        
|Equity in earnings (loss) of unconsolidated subsidiaries                                                              |                                    |        | 39,261  |              |  |              | 382     |              |   |              |        |         |   |   | (39,910 | )       |   |   | (267      | )      
|                                                                                                                     
|Net earnings                                                                                                          |                                    | $      | 29,822  |              |  | $            | 35,571  |              |   | $            | 4,411   |         |   | $ | (39,982 | )       |   | $ | 29,822    |        
|                                                                                                                     





45                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents









|                                                                                                  |                                                           |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |          |         |  
|------------------------------------------------------------------------------------------------- | --------------------------------------------------------- | ---------------------------------------- | -------- | ------------ | ------- | ------------ | ------- | ------------ | ------- | ------------ | ------ | ------ | ------- | - | ------- | ---- | ------ | - | ------- | -------- | ------- | -
|                                                                                                  |                                                           |                                          |          |              |         | Combined     |         |              |         |             
|                                                                                                  |                                                           |                                          |          | Combined     |         | Non-         |         |              |         |             
|                                                                                                  |                                                           |                                          |          | Guarantor    |         | Guarantor    |         |              |         |             
|(In thousands)                                                                                    |                                                           | Parent                                   |          | Subsidiaries |         | Subsidiaries |         | Eliminations |         | Consolidated
|                                                                                                 
|Cash flows from operating
    activities:                                                         |                                                           |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |         
|Net earnings                                                                                      |                                                           | $                                        | 29,822   |              |         | $            | 35,571  |              |         | $            | 4,411  |        |         | $ | (39,982 | )    |        | $ | 29,822  |         
|Adjustments to reconcile net earnings to net cash provided by
    (used in) operating activities: |                                                           |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |         
|                                                                                                  | Deferred income taxes                                     |                                          |          | (2,845       | )       |              |         | (553         | )       |              |        | 9,284  |         |   |         | (79  | )      |   |         | 5,807    |        
|                                                                                                  | Tax benefit of stock options exercised                    |                                          |          | 2,393        |         |              |         |             |         |              |        |       |         |   |         |     |        |   |         | 2,393    |        
|                                                                                                  | Depreciation and amortization                             |                                          |          | 208          |         |              |         | 19,179       |         |              |        | 3,620  |         |   |         | (68  | )      |   |         | 22,939   |        
|                                                                                                  | Gain on sales of equipment                                |                                          |          |             |         |              |         | (6,439       | )       |              |        |       |         |   |         | (358 | )      |   |         | (6,797   | )      
|                                                                                                  | Other                                                     |                                          |          |             |         |              |         | 274          |         |              |        | 401    |         |   |         | (24  | )      |   |         | 651      |        
|                                                                                                  | Decrease (increase) in assets:                            |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |          |        
|                                                                                                  |                                                           | Accounts and notes receivable            |          |              | (95,492 | )            |         |              | 54,661  |              |        |        | 8,241   |   |         |      | 262    |   |         |          | (32,328 | )
|                                                                                                  |                                                           | Inventories                              |          |              |        |              |         |              | 8,414   |              |        |        | 6,989   |   |         |      |       |   |         |          | 15,403  |  
|                                                                                                  |                                                           | Railcars held for sale                   |          |              |        |              |         |              | (38,126 | )            |        |        | (970    | ) |         |      | 601    |   |         |          | (38,495 | )
|                                                                                                  |                                                           | Other                                    |          |              | (45,887 | )            |         |              | (4,239  | )            |        |        | (199    | ) |         |      | 39,910 |   |         |          | (10,415 | )
|                                                                                                  | Increase (decrease) in liabilities:                       |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |          |        
|                                                                                                  |                                                           | Accounts payable and accrued liabilities |          |              | 4,459   |              |         |              | 21,480  |              |        |        | (25,715 | ) |         |      | (221   | ) |         |          | 3       |  
|                                                                                                  |                                                           | Participation                            |          |              |        |              |         |              | (15,207 | )            |        |        |        |   |         |      |       |   |         |          | (15,207 | )
|                                                                                                  |                                                           | Deferred revenue                         |          |              | 1,397   |              |         |              | 2,837   |              |        |        | 51      |   |         |      |       |   |         |          | 4,285   |  
|                                                                                                 
|Net cash provided by (used in) operating activities                                               |                                                           |                                          | (105,945 | )            |         |              | 77,852  |              |         |              | 6,113  |        |         |   | 41      |      |        |   | (21,939 | )       
|                                                                                                 
|Cash flows from investing
    activities:                                                         |                                                           |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |         
|                                                                                                  | Principal payments received under direct finance leases   |                                          |          |             |         |              |         | 5,733        |         |              |        |       |         |   |         |     |        |   |         | 5,733    |        
|                                                                                                  | Proceeds from sales of equipment                          |                                          |          |             |         |              |         | 32,528       |         |              |        |       |         |   |         |     |        |   |         | 32,528   |        
|                                                                                                  | Investment in and advances to unconsolidated subsidiaries |                                          |          |             |         |              |         | 92           |         |              |        |       |         |   |         |     |        |   |         | 92       |        
|                                                                                                  | Acquisition of joint venture interest                     |                                          |          |             |         |              |         | 8,435        |         |              |        |       |         |   |         |     |        |   |         | 8,435    |        
|                                                                                                  | Decrease in restricted cash                               |                                          |          |             |         |              |         |             |         |              |        | 1,007  |         |   |         |     |        |   |         | 1,007    |        
|                                                                                                  | Capital expenditures                                      |                                          |          |             |         |              |         | (63,747      | )       |              |        | (5,376 | )       |   |         |     |        |   |         | (69,123  | )      
|                                                                                                 
|Net cash used in investing activities                                                             |                                                           |                                          |         |              |         |              | (16,959 | )            |         |              | (4,369 | )      |         |   |        |      |        |   | (21,328 | )       
|                                                                                                 
|Cash flows from financing
    activities:                                                         |                                                           |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |         
|                                                                                                  | Changes in revolving notes                                |                                          |          |             |         |              |         |             |         |              |        | 2,514  |         |   |         |     |        |   |         | 2,514    |        
|                                                                                                  | Proceeds from notes payable                               |                                          |          | 175,000      |         |              |         |             |         |              |        |       |         |   |         |     |        |   |         | 175,000  |        
|                                                                                                  | Repayments of notes payable                               |                                          |          | (1,052       | )       |              |         | (65,752      | )       |              |        | (887   | )       |   |         |     |        |   |         | (67,691  | )      
|                                                                                                  | Repayments of subordinated debt                           |                                          |          |             |         |              |         | (6,325       | )       |              |        |       |         |   |         |     |        |   |         | (6,325   | )      
|                                                                                                  | Dividends                                                 |                                          |          | (3,889       | )       |              |         |             |         |              |        |       |         |   |         |     |        |   |         | (3,889   | )      
|                                                                                                  | Net proceeds from equity offering                         |                                          |          | 127,462      |         |              |         |             |         |              |        |       |         |   |         |     |        |   |         | 127,462  |        
|                                                                                                  | Repurchase and retirement of stock                        |                                          |          | (127,538     | )       |              |         |             |         |              |        |       |         |   |         |     |        |   |         | (127,538 | )      
|                                                                                                  | Stock options exercised and restricted stock awards       |                                          |          | 3,286        |         |              |         |             |         |              |        |       |         |   |         |     |        |   |         | 3,286    |        
|                                                                                                 
|Net cash provided by (used in) financing activities                                               |                                                           |                                          | 173,269  |              |         |              | (72,077 | )            |         |              | 1,627  |        |         |   |        |      |        |   | 102,819 |         
|                                                                                                 
|Effect of exchange rate changes                                                                   |                                                           |                                          | (564     | )            |         |              | 2,783   |              |         |              | (677   | )      |         |   |        |      |        |   | 1,542   |         
|Increase (decrease) in cash and cash equivalents                                                  |                                                           |                                          | 66,760   |              |         |              | (8,401  | )            |         |              | 2,694  |        |         |   | 41      |      |        |   | 61,094  |         
|Cash and cash
    equivalents                                                                     |                                                           |                                          |          |              |         |              |         |              |         |              |        |        |         |   |         |      |        |   |         |         
|Beginning of period                                                                               |                                                           |                                          |         |              |         |              | 10,454  |              |         |              | 1,656  |        |         |   |        |      |        |   | 12,110  |         
|                                                                                                 
|End of period                                                                                     |                                                           | $                                        | 66,760   |              |         | $            | 2,053   |              |         | $            | 4,350  |        |         | $ | 41      |      |        | $ | 73,204  |         
|                                                                                                 





46                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents









|                                         |                                                   |        |         |              |   |              |         |              |  |              |        |        |   |   |          |          |   |   |         |         | 
|---------------------------------------- | ------------------------------------------------- | ------ | ------- | ------------ | - | ------------ | ------- | ------------ |  | ------------ | ------ | ------ | - | - | -------- | -------- | - | - | ------- | ------- | 
|                                         |                                                   |        |         |              |   | Combined     |         |              |  |             
|                                         |                                                   |        |         | Combined     |   | Non-         |         |              |  |             
|                                         |                                                   |        |         | Guarantor    |   | Guarantor    |         |              |  |             
|(In thousands)                           |                                                   | Parent |         | Subsidiaries |   | Subsidiaries |         | Eliminations |  | Consolidated
|                                        
|Assets                                   |                                                   |        |         |              |   |              |         |              |  |              |        |        |   |   |          |          |   |   |         |        
|                                         | Cash and cash equivalents                         |        | $       |             |   |              | $       | 10,454       |  |              | $      | 1,656  |   |   | $        |         |   |   | $       | 12,110  | 
|                                         | Restricted cash                                   |        |         |             |   |              |         |             |  |              |        | 1,085  |   |   |          |         |   |   |         | 1,085   | 
|                                         | Accounts and notes receivable                     |        |         | (68,167      | ) |              |         | 162,994      |  |              |        | 25,001 |   |   |          | 179      |   |   |         | 120,007 | 
|                                         | Inventories                                       |        |         |             |   |              |         | 46,932       |  |              |        | 46,037 |   |   |          |         |   |   |         | 92,969  | 
|                                         | Railcars held for sale                            |        |         |             |   |              |         | 15,266       |  |              |        | 4,893  |   |   |          | (6       | ) |   |         | 20,153  | 
|                                         | Investment in direct finance leases               |        |         |             |   |              |         | 21,244       |  |              |        |       |   |   |          |         |   |   |         | 21,244  | 
|                                         | Equipment on operating leases                     |        |         |             |   |              |         | 164,633      |  |              |        |       |   |   |          | (2,375   | ) |   |         | 162,258 | 
|                                         | Property, plant and equipment                     |        |         | 35           |   |              |         | 37,868       |  |              |        | 18,512 |   |   |          |         |   |   |         | 56,415  | 
|                                         | Other                                             |        |         | 230,367      |   |              |         | 19,332       |  |              |        | 1,730  |   |   |          | (228,917 | ) |   |         | 22,512  | 
|                                        
|                                         |                                                   | $      | 162,235 |              |   | $            | 478,723 |              |  | $            | 98,914 |        |   | $ | (231,119 | )        |   | $ | 508,753 |        
|                                        
|                                        
|Liabilities and
    Stockholders Equity |                                                   |        |         |              |   |              |         |              |  |              |        |        |   |   |          |          |   |   |         |        
|                                         | Revolving notes                                   |        | $       |             |   |              | $       |             |  |              | $      | 8,947  |   |   | $        |         |   |   | $       | 8,947   | 
|                                         | Accounts payable and accrued liabilities          |        |         | 5,127        |   |              |         | 112,604      |  |              |        | 60,516 |   |   |          | 303      |   |   |         | 178,550 | 
|                                         | Participation                                     |        |         |             |   |              |         | 37,107       |  |              |        |       |   |   |          |         |   |   |         | 37,107  | 
|                                         | Deferred income tax                               |        |         | 3,797        |   |              |         | 32,114       |  |              |        | (9,481 | ) |   |          | (321     | ) |   |         | 26,109  | 
|                                         | Deferred revenue                                  |        |         |             |   |              |         | 2,550        |  |              |        |       |   |   |          |         |   |   |         | 2,550   | 
|                                         | Notes payable                                     |        |         | 9,124        |   |              |         | 74,523       |  |              |        | 13,866 |   |   |          |         |   |   |         | 97,513  | 
|                                         | Subordinated debt                                 |        |         |             |   |              |         | 14,942       |  |              |        |       |   |   |          |         |   |   |         | 14,942  | 
|                                         | Subsidiary shares subject to mandatory redemption |        |         |             |   |              |         |             |  |              |        |       |   |   |          | 3,746    |   |   |         | 3,746   | 
|Stockholders
    Equity                 |                                                   |        | 144,187 |              |   |              | 204,883 |              |  |              | 25,066 |        |   |   | (234,847 | )        |   |   | 139,289 |        
|                                        
|                                         |                                                   | $      | 162,235 |              |   | $            | 478,723 |              |  | $            | 98,914 |        |   | $ | (231,119 | )        |   | $ | 508,753 |        
|                                        





47                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents









|                                                                                                   |                                                    |        |         |              |  |              |         |              |  |              |         |         |  |   |         |        |   |   |         |         | 
|-------------------------------------------------------------------------------------------------- | -------------------------------------------------- | ------ | ------- | ------------ |  | ------------ | ------- | ------------ |  | ------------ | ------- | ------- |  | - | ------- | ------ | - | - | ------- | ------- | 
|                                                                                                   |                                                    |        |         |              |  | Combined     |         |              |  |             
|                                                                                                   |                                                    |        |         | Combined     |  | Non-         |         |              |  |             
|                                                                                                   |                                                    |        |         | Guarantor    |  | Guarantor    |         |              |  |             
|(In thousands)                                                                                     |                                                    | Parent |         | Subsidiaries |  | Subsidiaries |         | Eliminations |  | Consolidated
|                                                                                                  
|Revenue                                                                                            |                                                    |        |         |              |  |              |         |              |  |              |         |         |  |   |         |        |   |   |         |        
|                                                                                                   | Manufacturing                                      |        | $       | 28,551       |  |              | $       | 306,070      |  |              | $       | 306,984 |  |   | $       | 11,629 |   |   | $       | 653,234 | 
|                                                                                                   | Leasing & services                                 |        |         | 881          |  |              |         | 75,405       |  |              |         |        |  |   |         | (69    | ) |   |         | 76,217  | 
|                                                                                                  
|                                                                                                   |                                                    |        | 29,432  |              |  |              | 381,475 |              |  |              | 306,984 |         |  |   | 11,560  |        |   |   | 729,451 |        
|Cost of revenue                                                                                    |                                                    |        |         |              |  |              |         |              |  |              |         |         |  |   |         |        |   |   |         |        
|                                                                                                   | Manufacturing                                      |        |         | 25,042       |  |              |         | 270,455      |  |              |         | 287,717 |  |   |         | 11,812 |   |   |         | 595,026 | 
|                                                                                                   | Leasing & services                                 |        |         |             |  |              |         | 42,304       |  |              |         |        |  |   |         | (63    | ) |   |         | 42,241  | 
|                                                                                                  
|                                                                                                   |                                                    |        | 25,042  |              |  |              | 312,759 |              |  |              | 287,717 |         |  |   | 11,749  |        |   |   | 637,267 |        
|Margin                                                                                             |                                                    |        | 4,390   |              |  |              | 68,716  |              |  |              | 19,267  |         |  |   | (189    | )      |   |   | 92,184  |        
|Other costs                                                                                        |                                                    |        |         |              |  |              |         |              |  |              |         |         |  |   |         |        |   |   |         |        
|                                                                                                   | Selling and administrative expense                 |        |         | 12,608       |  |              |         | 24,748       |  |              |         | 10,932  |  |   |         |       |   |   |         | 48,288  | 
|                                                                                                   | Interest and foreign exchange                      |        |         | 2,386        |  |              |         | 6,170        |  |              |         | 2,975   |  |   |         | (63    | ) |   |         | 11,468  | 
|                                                                                                   | Special charges                                    |        |         |             |  |              |         |             |  |              |         | 1,234   |  |   |         |       |   |   |         | 1,234   | 
|                                                                                                  
|                                                                                                   |                                                    |        | 14,994  |              |  |              | 30,918  |              |  |              | 15,141  |         |  |   | (63     | )      |   |   | 60,990  |        
|                                                                                                  
|Earnings (loss) before income tax and equity in earnings (loss)
    of unconsolidated subsidiaries |                                                    |        | (10,604 | )            |  |              | 37,798  |              |  |              | 4,126   |         |  |   | (126    | )      |   |   | 31,194  |        
|Income tax (expense) benefit                                                                       |                                                    |        | 6,468   |              |  |              | (15,906 | )            |  |              | (26     | )       |  |   | 345     |        |   |   | (9,119  | )      
|                                                                                                  
|Earnings (loss) before equity in unconsolidated subsidiaries                                       |                                                    |        | (4,136  | )            |  |              | 21,892  |              |  |              | 4,100   |         |  |   | 219     |        |   |   | 22,075  |        
|Equity in earnings (loss) of unconsolidated subsidiaries                                           |                                                    |        | 24,914  |              |  |              | (822    | )            |  |              |        |         |  |   | (26,128 | )      |   |   | (2,036  | )      
|                                                                                                  
|Earnings (loss) from continuing operations                                                         |                                                    |        | 20,778  |              |  |              | 21,070  |              |  |              | 4,100   |         |  |   | (25,909 | )      |   |   | 20,039  |        
|                                                                                                   | Earnings from discontinued operations (net of tax) |        |         |             |  |              |         |             |  |              |         | 739     |  |   |         |       |   |   |         | 739     | 
|                                                                                                  
|Net earnings (loss)                                                                                |                                                    | $      | 20,778  |              |  | $            | 21,070  |              |  | $            | 4,839   |         |  | $ | (25,909 | )      |   | $ | 20,778  |        
|                                                                                                  





48                                        The
Greenbrier Companies 2005 Annual Report




---



##### Table of Contents









|                                                                                                         |                                                                 |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |         |         |  
|-------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------- | ---------------------------------------- | ------ | ------------ | ------- | ------------ | ------- | ------------ | ------- | ------------ | ------- | ------- | ------- | - | ------- | ------ | ------- | - | ------- | ------- | ------- | -
|                                                                                                         |                                                                 |                                          |        |              |         | Combined     |         |              |         |             
|                                                                                                         |                                                                 |                                          |        | Combined     |         | Non-         |         |              |         |             
|                                                                                                         |                                                                 |                                          |        | Guarantor    |         | Guarantor    |         |              |         |             
|(In thousands)                                                                                           |                                                                 | Parent                                   |        | Subsidiaries |         | Subsidiaries |         | Eliminations |         | Consolidated
|                                                                                                        
|Cash flows from operating
    activities:                                                                |                                                                 |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |        
|Net earnings                                                                                             |                                                                 | $                                        | 20,778 |              |         | $            | 21,070  |              |         | $            | 4,839   |         |         | $ | (25,909 | )      |         | $ | 20,778  |        
|Adjustments to reconcile net earnings (loss) to net cash
    provided by (used in) operating activities: |                                                                 |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |        
|                                                                                                         | Earnings from discontinued operations                           |                                          |        |             |         |              |         |             |         |              |         | (739    | )       |   |         |       |         |   |         | (739    | )      
|                                                                                                         | Deferred income taxes                                           |                                          |        | 1,220        |         |              |         | 8,200        |         |              |         | 571     |         |   |         | (345   | )       |   |         | 9,646   |        
|                                                                                                         | Depreciation and amortization                                   |                                          |        | 208          |         |              |         | 17,824       |         |              |         | 2,871   |         |   |         | (63    | )       |   |         | 20,840  |        
|                                                                                                         | Gain on sales of equipment                                      |                                          |        |             |         |              |         | (512         | )       |              |         |        |         |   |         | (117   | )       |   |         | (629    | )      
|                                                                                                         | Special charges                                                 |                                          |        |             |         |              |         |             |         |              |         | 1,234   |         |   |         |       |         |   |         | 1,234   |        
|                                                                                                         | Other                                                           |                                          |        |             |         |              |         | 896          |         |              |         | 435     |         |   |         | 1      |         |   |         | 1,332   |        
|                                                                                                         | Decrease (increase) in assets:                                  |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |         |        
|                                                                                                         |                                                                 | Accounts and notes receivable            |        |              | 6,441   |              |         |              | (32,065 | )            |         |         | (12,304 | ) |         |        | 142     |   |         |         | (37,786 | )
|                                                                                                         |                                                                 | Inventories                              |        |              |        |              |         |              | (21,108 | )            |         |         | (1,647  | ) |         |        | 400     |   |         |         | (22,355 | )
|                                                                                                         |                                                                 | Railcars held for sale                   |        |              |        |              |         |              | (14,523 | )            |         |         | (4,127  | ) |         |        | 32,747  |   |         |         | 14,097  |  
|                                                                                                         |                                                                 | Other                                    |        |              | (36,750 | )            |         |              | 692     |              |         |         | 11,593  |   |         |        | 27,405  |   |         |         | 2,940   |  
|                                                                                                         | Increase (decrease) in liabilities:                             |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |         |        
|                                                                                                         |                                                                 | Accounts payable and accrued liabilities |        |              | 3,814   |              |         |              | 18,461  |              |         |         | 8,699   |   |         |        | (18     | ) |         |         | 30,956  |  
|                                                                                                         |                                                                 | Participation                            |        |              |        |              |         |              | (18,794 | )            |         |         |        |   |         |        |        |   |         |         | (18,794 | )
|                                                                                                         |                                                                 | Deferred revenue                         |        |              |        |              |         |              | (3,367  | )            |         |         | (522    | ) |         |        | (33,606 | ) |         |         | (37,495 | )
|                                                                                                        
|Net cash provided by (used in) operating activities                                                      |                                                                 |                                          | (4,289 | )            |         |              | (23,226 | )            |         |              | 10,903  |         |         |   | 637     |        |         |   | (15,975 | )      
|                                                                                                        
|Cash flows from investing
    activities:                                                                |                                                                 |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |        
|                                                                                                         | Principal payments received under direct finance lease          |                                          |        |             |         |              |         | 9,461        |         |              |         |        |         |   |         |       |         |   |         | 9,461   |        
|                                                                                                         | Proceeds from sales of equipment                                |                                          |        |             |         |              |         | 16,217       |         |              |         |        |         |   |         |       |         |   |         | 16,217  |        
|                                                                                                         | Investment in and advances to unconsolidated subsidiaries       |                                          |        |             |         |              |         | (2,240       | )       |              |         |        |         |   |         |       |         |   |         | (2,240  | )      
|                                                                                                         | Decrease in restricted cash                                     |                                          |        |             |         |              |         | 1,233        |         |              |         | 3,524   |         |   |         |       |         |   |         | 4,757   |        
|                                                                                                         | Capital expenditures                                            |                                          |        |             |         |              |         | (40,221      | )       |              |         | (3,378  | )       |   |         | 640    |         |   |         | (42,959 | )      
|                                                                                                        
|Net cash provided by (used in) investing activities                                                      |                                                                 |                                          |       |              |         |              | (15,550 | )            |         |              | (146    | )       |         |   | 640     |        |         |   | (14,764 | )      
|                                                                                                        
|Cash flows from financing
    activities:                                                                |                                                                 |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |        
|                                                                                                         | Changes in revolving notes                                      |                                          |        |             |         |              |         |             |         |              |         | (14,030 | )       |   |         |       |         |   |         | (14,030 | )      
|                                                                                                         | Repayments of notes payable                                     |                                          |        | (969         | )       |              |         | (19,751      | )       |              |         | (819    | )       |   |         |       |         |   |         | (21,539 | )      
|                                                                                                         | Repayments of subordinated debt                                 |                                          |        |             |         |              |         | (5,979       | )       |              |         |        |         |   |         |       |         |   |         | (5,979  | )      
|                                                                                                         | Dividends                                                       |                                          |        | (889         | )       |              |         |             |         |              |         |        |         |   |         |       |         |   |         | (889    | )      
|                                                                                                         | Proceeds from exercise of stock options                         |                                          |        | 6,093        |         |              |         |             |         |              |         |        |         |   |         |       |         |   |         | 6,093   |        
|                                                                                                         | Purchase of subsidiaries shares subject to mandatory redemption |                                          |        |             |         |              |         |             |         |              |         |        |         |   |         | (1,277 | )       |   |         | (1,277  | )      
|                                                                                                        
|Net cash provided by (used in) financing activities                                                      |                                                                 |                                          | 4,235  |              |         |              | (25,730 | )            |         |              | (14,849 | )       |         |   | (1,277  | )      |         |   | (37,621 | )      
|                                                                                                        
|Effect of exchange rate changes                                                                          |                                                                 |                                          | 54     |              |         |              | 571     |              |         |              | 2,547   |         |         |   |        |        |         |   | 3,172   |        
|Decrease in cash and cash equivalents                                                                    |                                                                 |                                          |       |              |         |              | (63,935 | )            |         |              | (1,253  | )       |         |   |        |        |         |   | (65,188 | )      
|Cash and cash
    equivalents:                                                                           |                                                                 |                                          |        |              |         |              |         |              |         |              |         |         |         |   |         |        |         |   |         |        
|Beginning of period                                                                                      |                                                                 |                                          |       |              |         |              | 74,389  |              |         |              | 2,909   |         |         |   |        |        |         |   | 77,298  |        
|                                                                                                        
|End of period                                                                                            |                                                                 | $                                        |       |              |         | $            | 10,454  |              |         | $            | 1,656   |         |         | $ |        |        |         | $ | 12,110  |        
|                                                                                                        





49                                        The
Greenbrier Companies 2005 Annual Report




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##### Table of Contents









|                                                                                                |                                    |        |         |              |  |              |         |              |  |              |         |         |   |   |         |         |   |   |         |         | 
|----------------------------------------------------------------------------------------------- | ---------------------------------- | ------ | ------- | ------------ |  | ------------ | ------- | ------------ |  | ------------ | ------- | ------- | - | - | ------- | ------- | - | - | ------- | ------- | 
|                                                                                                |                                    |        |         |              |  | Combined     |         |              |  |             
|                                                                                                |                                    |        |         | Combined     |  | Non-         |         |              |  |             
|                                                                                                |                                    |        |         | Guarantor    |  | Guarantor    |         |              |  |             
|(In thousands)                                                                                  |                                    | Parent |         | Subsidiaries |  | Subsidiaries |         | Eliminations |  | Consolidated
|                                                                                               
|Revenue                                                                                         |                                    |        |         |              |  |              |         |              |  |              |         |         |   |   |         |         |   |   |         |        
|                                                                                                | Manufacturing                      |        | $       | 654          |  |              | $       | 278,614      |  |              | $       | 213,516 |   |   | $       | (30,902 | ) |   | $       | 461,882 | 
|                                                                                                | Leasing & services                 |        |         | 328          |  |              |         | 69,929       |  |              |         | (78     | ) |   |         | 264     |   |   |         | 70,443  | 
|                                                                                               
|                                                                                                |                                    |        | 982     |              |  |              | 348,543 |              |  |              | 213,438 |         |   |   | (30,638 | )       |   |   | 532,325 |        
|Cost of revenue                                                                                 |                                    |        |         |              |  |              |         |              |  |              |         |         |   |   |         |         |   |   |         |        
|                                                                                                | Manufacturing                      |        |         |             |  |              |         | 250,047      |  |              |         | 205,409 |   |   |         | (31,078 | ) |   |         | 424,378 | 
|                                                                                                | Leasing & services                 |        |         |             |  |              |         | 43,645       |  |              |         | (1      | ) |   |         | (35     | ) |   |         | 43,609  | 
|                                                                                               
|                                                                                                |                                    |        |        |              |  |              | 293,692 |              |  |              | 205,408 |         |   |   | (31,113 | )       |   |   | 467,987 |        
|Margin                                                                                          |                                    |        | 982     |              |  |              | 54,851  |              |  |              | 8,030   |         |   |   | 475     |         |   |   | 64,338  |        
|Other costs                                                                                     |                                    |        |         |              |  |              |         |              |  |              |         |         |   |   |         |         |   |   |         |        
|                                                                                                | Selling and administrative expense |        |         | 9,786        |  |              |         | 21,489       |  |              |         | 8,687   |   |   |         |        |   |   |         | 39,962  | 
|                                                                                                | Interest and foreign exchange      |        |         | 2,319        |  |              |         | 9,049        |  |              |         | 2,291   |   |   |         | (41     | ) |   |         | 13,618  | 
|                                                                                               
|                                                                                                |                                    |        | 12,105  |              |  |              | 30,538  |              |  |              | 10,978  |         |   |   | (41     | )       |   |   | 53,580  |        
|Earnings (loss) before income tax, equity in earnings (loss) of
    unconsolidated subsidiaries |                                    |        | (11,123 | )            |  |              | 24,313  |              |  |              | (2,948  | )       |   |   | 516     |         |   |   | 10,758  |        
|Income tax (expense) benefit                                                                    |                                    |        | 4,666   |              |  |              | (10,198 | )            |  |              | 1,534   |         |   |   | (545    | )       |   |   | (4,543  | )      
|                                                                                               
|Earnings (loss) before equity in unconsolidated subsidiaries                                    |                                    |        | (6,457  | )            |  |              | 14,115  |              |  |              | (1,414  | )       |   |   | (29     | )       |   |   | 6,215   |        
|Equity in earnings (loss) of unconsolidated subsidiaries                                        |                                    |        | 10,774  |              |  |              | (50     | )            |  |              |        |         |   |   | (12,622 | )       |   |   | (1,898  | )      
|                                                                                               
|Net earnings (loss)                                                                             |                                    | $      | 4,317   |              |  | $            | 14,065  |              |  | $            | (1,414  | )       |   | $ | (12,651 | )       |   | $ | 4,317   |        
|                                                                                               





50                                        The
Greenbrier Companies 2005 Annual Report




---



##### Table of Contents









|                                                                                                         |                                                           |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |         |         |  
|-------------------------------------------------------------------------------------------------------- | --------------------------------------------------------- | ---------------------------------------- | ----- | ------------ | ------- | ------------ | ------ | ------------ | ------- | ------------ | ------ | ------ | ------- | - | ------- | ---- | ------- | - | ------ | ------- | ------- | -
|                                                                                                         |                                                           |                                          |       |              |         | Combined     |        |              |         |             
|                                                                                                         |                                                           |                                          |       | Combined     |         | Non-         |        |              |         |             
|                                                                                                         |                                                           |                                          |       | Guarantor    |         | Guarantor    |        |              |         |             
|(In thousands)                                                                                           |                                                           | Parent                                   |       | Subsidiaries |         | Subsidiaries |        | Eliminations |         | Consolidated
|                                                                                                        
|Cash flows from operating
    activities:                                                                |                                                           |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |        
|Net earnings (loss)                                                                                      |                                                           | $                                        | 4,317 |              |         | $            | 14,065 |              |         | $            | (1,414 | )      |         | $ | (12,651 | )    |         | $ | 4,317  |        
|Adjustments to reconcile net earnings (loss) to net cash
    provided by (used in) operating activities: |                                                           |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |        
|                                                                                                         | Deferred income taxes                                     |                                          |       | 3,252        |         |              |        | (1,036       | )       |              |        | (140   | )       |   |         | 544  |         |   |        | 2,620   |        
|                                                                                                         | Depreciation and amortization                             |                                          |       | 216          |         |              |        | 16,506       |         |              |        | 2,024  |         |   |         | (35  | )       |   |        | 18,711  |        
|                                                                                                         | Gain on sales of equipment                                |                                          |       |             |         |              |        | (150         | )       |              |        |       |         |   |         | (304 | )       |   |        | (454    | )      
|                                                                                                         | Other                                                     |                                          |       |             |         |              |        | 132          |         |              |        | 529    |         |   |         |     |         |   |        | 661     |        
|                                                                                                         | Decrease (increase) in assets:                            |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |         |        
|                                                                                                         |                                                           | Accounts and notes receivable            |       |              | 7,839   |              |        |              | (32,212 | )            |        |        | (168    | ) |         |      | (245    | ) |        |         | (24,786 | )
|                                                                                                         |                                                           | Inventories                              |       |              |        |              |        |              | (885    | )            |        |        | (8,336  | ) |         |      | (1,054  | ) |        |         | (10,275 | )
|                                                                                                         |                                                           | Railcars held for sale                   |       |              |        |              |        |              | 6,706   |              |        |        | 29,398  |   |         |      | (32,727 | ) |        |         | 3,377   |  
|                                                                                                         |                                                           | Other                                    |       |              | (11,257 | )            |        |              | (872    | )            |        |        | 655     |   |         |      | 12,622  |   |        |         | 1,148   |  
|                                                                                                         | Increase (decrease) in liabilities:                       |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |         |        
|                                                                                                         |                                                           | Accounts payable and accrued liabilities |       |              | (4,602  | )            |        |              | 21,038  |              |        |        | 14,162  |   |         |      | 245     |   |        |         | 30,843  |  
|                                                                                                         |                                                           | Participation                            |       |              |        |              |        |              | (5,094  | )            |        |        |        |   |         |      |        |   |        |         | (5,094  | )
|                                                                                                         |                                                           | Deferred revenue                         |       |              |        |              |        |              | 2,978   |              |        |        | (30,212 | ) |         |      | 33,605  |   |        |         | 6,371   |  
|                                                                                                        
|Net cash provided by (used in) operating activities                                                      |                                                           |                                          | (235  | )            |         |              | 21,176 |              |         |              | 6,498  |        |         |   |        |      |         |   | 27,439 |        
|                                                                                                        
|Cash flows from investing
    activities:                                                                |                                                           |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |        
|                                                                                                         | Principal payments received under direct finance leases   |                                          |       |             |         |              |        | 14,294       |         |              |        |       |         |   |         |     |         |   |        | 14,294  |        
|                                                                                                         | Proceeds from sales of equipment                          |                                          |       |             |         |              |        | 23,954       |         |              |        |       |         |   |         |     |         |   |        | 23,954  |        
|                                                                                                         | Investment in and advances to unconsolidated subsidiaries |                                          |       |             |         |              |        | (3,126       | )       |              |        |       |         |   |         |     |         |   |        | (3,126  | )      
|                                                                                                         | Increase in restricted cash                               |                                          |       |             |         |              |        | (1,099       | )       |              |        | (4,201 | )       |   |         |     |         |   |        | (5,300  | )      
|                                                                                                         | Capital expenditures                                      |                                          |       | (2           | )       |              |        | (8,206       | )       |              |        | (3,687 | )       |   |         |     |         |   |        | (11,895 | )      
|                                                                                                        
|                                                                                                         | Net cash provided by (used in) investing activities       |                                          |       | (2           | )       |              |        | 25,817       |         |              |        | (7,888 | )       |   |         |     |         |   |        | 17,927  |        
|                                                                                                        
|Cash flows from financing
    activities:                                                                |                                                           |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |        
|                                                                                                         | Changes in revolving notes                                |                                          |       |             |         |              |        |             |         |              |        | (5,754 | )       |   |         |     |         |   |        | (5,754  | )      
|                                                                                                         | Proceeds from notes payable                               |                                          |       |             |         |              |        |             |         |              |        | 6,348  |         |   |         |     |         |   |        | 6,348   |        
|                                                                                                         | Repayments of notes payable                               |                                          |       | (892         | )       |              |        | (25,454      | )       |              |        | (7,712 | )       |   |         |     |         |   |        | (34,058 | )      
|                                                                                                         | Repayments of subordinated debt                           |                                          |       |             |         |              |        | (6,148       | )       |              |        |       |         |   |         |     |         |   |        | (6,148  | )      
|                                                                                                         | Proceeds from exercise of stock options                   |                                          |       | 1,797        |         |              |        |             |         |              |        |       |         |   |         |     |         |   |        | 1,797   |        
|                                                                                                        
|                                                                                                         | Net cash provided by (used in) financing activities       |                                          |       | 905          |         |              |        | (31,602      | )       |              |        | (7,118 | )       |   |         |     |         |   |        | (37,815 | )      
|                                                                                                        
|Effect of exchange rate changes                                                                          |                                                           |                                          | (668  | )            |         |              | 423    |              |         |              | 2,396  |        |         |   |        |      |         |   | 2,151  |        
|Increase (decrease) in cash and cash equivalents                                                         |                                                           |                                          |      |              |         |              | 15,814 |              |         |              | (6,112 | )      |         |   |        |      |         |   | 9,702  |        
|Cash and cash
    equivalents:                                                                           |                                                           |                                          |       |              |         |              |        |              |         |              |        |        |         |   |         |      |         |   |        |        
|Beginning of period                                                                                      |                                                           |                                          |      |              |         |              | 58,575 |              |         |              | 9,021  |        |         |   |        |      |         |   | 67,596 |        
|                                                                                                        
|End of period                                                                                            |                                                           | $                                        |      |              |         | $            | 74,389 |              |         | $            | 2,909  |        |         | $ |        |      |         | $ | 77,298 |        
|                                                                                                        





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##### Table of Contents



Quarterly Results of
Operations




|                                                                         |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |           |         | 
|------------------------------------------------------------------------ | ---------------------------------- | ----- | ------- | ------- | ------ | - | ------- | ------- |  | - | ------- | ------- |  | ----- | ------- | ------- |  | - | --------- | ------- | 
|(In thousands, except per share amounts)                                 |                                    | First |         |         | Second |   |         | Third   |  |   | Fourth  |         |  | Total |        
|                                                                         |                                   
|2005                                                                     |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |           |        
|Revenue                                                                  |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |           |        
|                                                                         | Manufacturing                      |       | $       | 200,397 |        |   | $       | 233,808 |  |   | $       | 266,090 |  |       | $       | 240,866 |  |   | $         | 941,161 | 
|                                                                         | Leasing & services                 |       |         | 17,651  |        |   |         | 21,105  |  |   |         | 19,944  |  |       |         | 24,361  |  |   |           | 83,061  | 
|                                                                        
|                                                                         |                                    |       | 218,048 |         |        |   | 254,913 |         |  |   | 286,034 |         |  |       | 265,227 |         |  |   | 1,024,222 |        
|Cost of revenue                                                          |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |           |        
|                                                                         | Manufacturing                      |       |         | 182,862 |        |   |         | 217,796 |  |   |         | 241,491 |  |       |         | 215,801 |  |   |           | 857,950 | 
|                                                                         | Leasing & services                 |       |         | 10,380  |        |   |         | 10,570  |  |   |         | 9,561   |  |       |         | 10,588  |  |   |           | 41,099  | 
|                                                                        
|                                                                         |                                    |       | 193,242 |         |        |   | 228,366 |         |  |   | 251,052 |         |  |       | 226,389 |         |  |   | 899,049   |        
|Margin                                                                   |                                    |       | 24,806  |         |        |   | 26,547  |         |  |   | 34,982  |         |  |       | 38,838  |         |  |   | 125,173   |        
|Other costs                                                              |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |           |        
|                                                                         | Selling and administrative expense |       |         | 12,072  |        |   |         | 14,044  |  |   |         | 15,276  |  |       |         | 16,033  |  |   |           | 57,425  | 
|                                                                         | Interest and foreign exchange      |       |         | 3,059   |        |   |         | 4,295   |  |   |         | 2,285   |  |       |         | 5,196   |  |   |           | 14,835  | 
|                                                                         | Special charges                    |       |         |        |        |   |         |        |  |   |         | 2,913   |  |       |         |        |  |   |           | 2,913   | 
|                                                                        
|                                                                         |                                    |       | 15,131  |         |        |   | 18,339  |         |  |   | 20,474  |         |  |       | 21,229  |         |  |   | 75,173    |        
|Earnings before income tax and equity in unconsolidated
    subsidiaries |                                    |       | 9,675   |         |        |   | 8,208   |         |  |   | 14,508  |         |  |       | 17,609  |         |  |   | 50,000    |        
|Income tax expense                                                       |                                    |       | (3,554  | )       |        |   | (3,397  | )       |  |   | (5,881  | )       |  |       | (7,079  | )       |  |   | (19,911   | )      
|Equity in (loss) earnings of unconsolidated subsidiaries                 |                                    |       | (731    | )       |        |   | (9      | )       |  |   | 417     |         |  |       | 56      |         |  |   | (267      | )      
|                                                                        
|Net earnings                                                             |                                    | $     | 5,390   |         |        | $ | 4,802   |         |  | $ | 9,044   |         |  | $     | 10,586  |         |  | $ | 29,822    |        
|                                                                        
|Basic earnings per common share:                                         |                                    | $     | .36     |         |        | $ | .32     |         |  | $ | .60     |         |  | $     | .71     |         |  | $ | 1.99      |        
|Diluted earnings per common share:                                       |                                    | $     | .35     |         |        | $ | .31     |         |  | $ | .58     |         |  | $     | .68     |         |  | $ | 1.92      |        





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##### Table of Contents



Quarterly Results of
Operations




|                                                                       |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |         | 
|---------------------------------------------------------------------- | ---------------------------------- | ----- | ------- | ------- | ------ | - | ------- | ------- |  | - | ------- | ------- |  | ----- | ------- | ------- |  | - | ------- | ------- | 
|(In thousands, except per share amounts)                               |                                    | First |         |         | Second |   |         | Third   |  |   | Fourth  |         |  | Total |        
|                                                                       |                                   
|2004                                                                   |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |        
|Revenue                                                                |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |        
|                                                                       | Manufacturing                      |       | $       | 117,303 |        |   | $       | 148,725 |  |   | $       | 207,136 |  |       | $       | 180,070 |  |   | $       | 653,234 | 
|                                                                       | Leasing & services                 |       |         | 17,896  |        |   |         | 17,836  |  |   |         | 18,157  |  |       |         | 22,328  |  |   |         | 76,217  | 
|                                                                      
|                                                                       |                                    |       | 135,199 |         |        |   | 166,561 |         |  |   | 225,293 |         |  |       | 202,398 |         |  |   | 729,451 |        
|Cost of revenue                                                        |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |        
|                                                                       | Manufacturing                      |       |         | 104,589 |        |   |         | 138,993 |  |   |         | 189,275 |  |       |         | 162,169 |  |   |         | 595,026 | 
|                                                                       | Leasing & services                 |       |         | 10,837  |        |   |         | 10,404  |  |   |         | 10,301  |  |       |         | 10,699  |  |   |         | 42,241  | 
|                                                                      
|                                                                       |                                    |       | 115,426 |         |        |   | 149,397 |         |  |   | 199,576 |         |  |       | 172,868 |         |  |   | 637,267 |        
|Margin                                                                 |                                    |       | 19,773  |         |        |   | 17,164  |         |  |   | 25,717  |         |  |       | 29,530  |         |  |   | 92,184  |        
|Other costs                                                            |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |        
|                                                                       | Selling and administrative expense |       |         | 10,060  |        |   |         | 10,924  |  |   |         | 12,352  |  |       |         | 14,952  |  |   |         | 48,288  | 
|                                                                       | Interest and foreign exchange      |       |         | 2,601   |        |   |         | 2,604   |  |   |         | 2,932   |  |       |         | 3,331   |  |   |         | 11,468  | 
|                                                                       | Special charges                    |       |         |        |        |   |         | 1,234   |  |   |         |        |  |       |         |        |  |   |         | 1,234   | 
|                                                                      
|                                                                       |                                    |       | 12,661  |         |        |   | 14,762  |         |  |   | 15,284  |         |  |       | 18,283  |         |  |   | 60,990  |        
|Earnings before income tax and equity in unconsolidated
    subsidiary |                                    |       | 7,112   |         |        |   | 2,402   |         |  |   | 10,433  |         |  |       | 11,247  |         |  |   | 31,194  |        
|Income tax benefit (expense)                                           |                                    |       | (2,639  | )       |        |   | 1,309   |         |  |   | (4,116  | )       |  |       | (3,673  | )       |  |   | (9,119  | )      
|Equity in (loss) earnings of unconsolidated subsidiary                 |                                    |       | (318    | )       |        |   | (1,474  | )       |  |   | 58      |         |  |       | (302    | )       |  |   | (2,036  | )      
|                                                                      
|Net earnings from continuing operations                                |                                    |       | 4,155   |         |        |   | 2,237   |         |  |   | 6,375   |         |  |       | 7,272   |         |  |   | 20,039  |        
|Earnings from discontinued operations                                  |                                    |       |        |         |        |   |        |         |  |   |        |         |  |       | 739     |         |  |   | 739     |        
|                                                                      
|Net earnings                                                           |                                    | $     | 4,155   |         |        | $ | 2,237   |         |  | $ | 6,375   |         |  | $     | 8,011   |         |  | $ | 20,778  |        
|                                                                      
|Basic earnings per common
    share                                    |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |        
|Continuing operations                                                  |                                    | $     | .29     |         |        | $ | .15     |         |  | $ | .44     |         |  | $     | .50     |         |  | $ | 1.38    |        
|Net earnings                                                           |                                    | $     | .29     |         |        | $ | .15     |         |  | $ | .44     |         |  | $     | .55     |         |  | $ | 1.43    |        
|Diluted earnings per common
    share                                  |                                    |       |         |         |        |   |         |         |  |   |         |         |  |       |         |         |  |   |         |        
|Continuing operations                                                  |                                    | $     | .28     |         |        | $ | .15     |         |  | $ | .42     |         |  | $     | .47     |         |  | $ | 1.32    |        
|Net earnings                                                           |                                    | $     | .28     |         |        | $ | .15     |         |  | $ | .42     |         |  | $     | .52     |         |  | $ | 1.37    |        





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##### Table of Contents



Report of Independent Registered
Public Accounting Firm


Board of Directors and Stockholders


The Greenbrier Companies, Inc.








Internal Control Integrated
Framework











Item 9. 
 CHANGES IN AND DISAGREEMENTS 
 WITH ACCOUNTANTS ON ACCOUNTING 
 AND FINANCIAL DISCLOSURE








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##### Table of Contents






Item 9a. 
 CONTROLS AND PROCEDURES


Evaluation of Disclosure Controls and Procedures




Changes In Internal Controls




Managements Report on Internal Control over
Financial Reporting








Inherent Limitations on Effectiveness of Controls








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##### Table of Contents



Report of Independent Registered
Public Accounting Firm


Board of Directors and Stockholders


The Greenbrier Companies, Inc.


Internal Control Integrated Framework








Internal
Control Integrated Framework Internal Control Integrated Framework














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##### Table of Contents






PART III





Item 10. 
 DIRECTORS AND EXECUTIVE 
 OFFICERS OF THE REGISTRANT







Item 11. 
 EXECUTIVE COMPENSATION







Item 12. 
 SECURITY OWNERSHIP OF CERTAIN 
 BENEFICIAL OWNERS AND 
 MANAGEMENT AND RELATED 
 STOCKHOLDER MATTERS







Item 13.         CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS







Item 14.         PRINCIPAL
ACCOUNTANT FEES AND SERVICES








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##### Table of Contents






PART IV





Item 15.       EXHIBITS,
FINANCIAL STATEMENT SCHEDULES










|  |                                                                                                                                                                                                                                                                                                                                                    
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | All other schedules have been omitted because they are
    inapplicable, not required or because the information is given
    in the Consolidated Financial Statements or notes thereto. This
    supplemental schedule should be read in conjunction with the
    Consolidated Financial Statements and notes thereto included in
    this report.



| |       |   |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | ----- | - |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3.1.  |   |  | Registrants Restated Certificate of Incorporation is
    incorporated herein by reference to Exhibit 3.1 to the
    Registrants Registration Statement No. 33-78852,
    effective July 11, 1994, together with Certificate of
    Designation of Preferences and Rights of Series A Preferred
    Stock, dated July 13, 2004, is incorporated herein by
    reference to exhibit 3.1 to the Registrants Annual
    Report on form 10-K for the year ended August 31, 2004.                                                                                           
| | 3.2.  |   |  | Registrants Amended and Restated By-laws, as amended on
    November 9, 1994, January 8, 2002, and August 20,
    2004, is incorporated herein by reference to Exhibit 3.2 to
    the Registrants Annual Report on Form 10-K for the
    year ended August 31, 2004.                                                                                                                                                                                                                                                                                                   
| | 4.1.  |   |  | Rights Agreement, dated as of July 13, 2004, between the
    Registrant and EquiServe Trust Registrant, N.A., as Rights
    Agent, is incorporated herein by reference to Exhibit 4.1
    to the Registrants Registration Statement on Form 8-A
    filed September 16, 2004.                                                                                                                                                                                                                                                                                           
| | 4.2.  |   |  | Amendment No. 1 to the Rights Agreement, dated as of
    July 13, 2004, is incorporated herein by reference to
    Exhibit 4.2 to the Registrants Form 8-K filed
    November 15, 2004.                                                                                                                                                                                                                                                                                                                                                                                 
| | 4.3.  |   |  | Amendment No. 2 to the Rights Agreement, dated as of
    July 13, 2004, incorporated herein by reference to
    Exhibit 4.3 to the Registrants Form 8-K filed
    February 9, 2005.                                                                                                                                                                                                                                                                                                                                                                                     
| | 4.4.  |   |  | Registration Rights Agreement among the Registrant and Banc of
    America Securities LLC and Bear, Stearns & Co. Inc.,
    dated May 11, 2005, is incorporated herein by reference to
    Exhibit 10.1 to the Registrants Form 8-K filed
    May 13, 2005.                                                                                                                                                                                                                                                                                                             
| | 4.5.  |   |  | Indenture between the Registrant, Autostack Corporation,
    Greenbrier-Concarril, LLC, Greenbrier Leasing Corporation,
    Greenbrier Leasing Limited Partner, LLC, Greenbrier Management
    Services, LLC, Greenbrier Leasing, L.P., Greenbrier Railcar,
    Inc., Gunderson, Inc., Gunderson Marine, Inc., Gunderson Rail
    Services, Inc., Gunderson Specialty Products, LLC and
    U.S. Bank National Association as Trustee dated
    May 11, 2005, is incorporated herein by reference to
    Exhibit 4.1 to the Registrants Form 8-K filed
    May 13, 2005.
| | 10.1. | * |  | Greenbrier Leasing Corporations Manager Owned Target
    Benefit Plan dated as of January 1, 1996 is incorporated
    herein by reference to Exhibit 10.35 to the
    Registrants Quarterly Report on Form 10-Q for the
    quarter ended May 31, 1997.                                                                                                                                                                                                                                                                                                                
| | 10.2. | * |  | James-Furman Supplemental 1994 Stock Option Plan is incorporated
    herein by reference to Exhibit 10.23 to the
    Registrants Annual Report on Form 10-K for the year
    ended August 31, 1994.                                                                                                                                                                                                                                                                                                                                                                     
| | 10.3. |   |  | Form of Agreement concerning Indemnification and Related Matters
    (Directors) between Registrant and its directors is incorporated
    herein by reference to Exhibit 10.18 to the
    Registrants Registration Statement No. 33-78852,
    dated July 11, 1994.                                                                                                                                                                                                                                                                                                     
| | 10.4. |   |  | Railcar Management Agreement between Greenbrier Leasing
    Corporation and James-Furman & Registrant, dated as of
    December 31, 1989 is incorporated herein by reference to
    Exhibit 10.9 to the Registrants Registration
    Statement No. 33 78852, dated July 11, 1994.                                                                                                                                                                                                                                                                                       





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##### Table of Contents



EXHIBITS, FINANCIAL STATEMENT
SCHEDULES (continued)


| |        |   |  |                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ------ | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.5.  |   |  | Form of Amendment No. 1 to Railcar Management Agreement
    between Greenbrier Leasing Corporation and
    James-Furman & Registrant dated as of July 1, 1994
    is incorporated herein by reference to Exhibit 10.11 to the
    Registrants Registration Statement No. 33-78852,
    dated July 11, 1994.                                                                                                      
| | 10.6.  |   |  | Railcar Maintenance Agreement between Greenbrier Leasing
    Corporation and James-Furman & Registrant, dated as of
    December 31, 1989 is incorporated herein by reference to
    Exhibit 10.10 to the Registrants Registration
    Statement No. 33-78852, dated July 11, 1994.                                                                                                                              
| | 10.7.  |   |  | Form of Amendment No. 1 to Railcar Maintenance Agreement
    between Greenbrier Leasing Corporation and
    James-Furman & Registrant dated as of July 1, 1994
    is incorporated herein by reference to Exhibit 10.12 to the
    Registrants Registration Statement No. 33-78852,
    dated July 11, 1994.                                                                                                     
| | 10.8.  |   |  | Lease of Land and Improvements dated as of July 23, 1992
    between the Atchison, Topeka and Santa Fe Railway
    Registrant and Gunderson Southwest, Inc. is incorporated herein
    by reference to Exhibit 10.4 to the Registrants
    Registration Statement No. 33-78852, dated July 11,
    1994.                                                                                                         
| | 10.9.  |   |  | Re-marketing Agreement dated as of November 19, 1987 among
    Southern Pacific Transportation Registrant, St. Louis
    Southwestern Railway Registrant, Greenbrier Leasing Corporation
    and Greenbrier Railcar, Inc. is incorporated herein by reference
    to Exhibit 10.5 to the Registrants Registration
    Statement No. 33-78852, dated July 11, 1994.                                               
| | 10.10. |   |  | Amendment to Re-marketing Agreement among Southern Pacific
    Transportation Registrant, St. Louis Southwestern Railway
    Registrant, Greenbrier Leasing Corporation and Greenbrier
    Railcar, Inc. dated as of November 15, 1988 is incorporated
    herein by reference to Exhibit 10.6 to the
    Registrants Registration Statement No. 33-78852,
    dated July 11, 1994.                              
| | 10.11. |   |  | Amendment No. 2 to Re-marketing Agreement among Southern
    Pacific Transportation Registrant, St. Louis Southwestern
    Railway Registrant, Greenbrier Leasing Corporation and
    Greenbrier Railcar, Inc. is incorporated herein by reference to
    Exhibit 10.7 to the Registrants Registration
    Statement No. 33-78852, dated July 11, 1994.                                                          
| | 10.12. |   |  | Amendment No. 3 to Re-marketing Agreement dated
    November 19, 1987 among Southern Pacific Transportation
    Registrant, St. Louis Southwestern Railway Registrant,
    Greenbrier Leasing Corporation and Greenbrier Railcar, Inc.
    dated as of March 5, 1991 is incorporated herein by
    reference to Exhibit 10.8 to the Registrants
    Registration Statement No. 33-78852, dated July 11,
    1994.
| | 10.13. |   |  | First amendment dated September 26, 1994 to the Lease of
    Land and Improvements dated as of July 23, 1992 between The
    Atchison, Topeka and Santa Fe Railway Registrant and
    Gunderson Southwest, Inc. is incorporated herein by reference to
    Exhibit 10.24 to the Registrants Quarterly Report on
    Form 10-Q for the quarter ended November 30, 1994.                                           
| | 10.14. | * |  | Stock Incentive Plan2000, dated as of April 6, 1999
    is incorporated herein by reference to Exhibit 10.23 to the
    Registrants Annual Report on Form 10-K for the year
    ended August 31, 1999.                                                                                                                                                                                                          
| | 10.15. | * |  | Amendment No. 1 to the Stock Incentive Plan2000, is
    incorporated herein by reference to Exhibit 10.1 to the
    Registrants Form 10-Q for the quarter ended
    February 28, 2001.                                                                                                                                                                                                                          
| | 10.16. | * |  | Amendment No. 2 to the Stock Incentive Plan2000, is
    incorporated herein by reference to Exhibit 10.2 to the
    Registrants Form 10-Q for the quarter ended
    February 28, 2001.                                                                                                                                                                                                                          
| | 10.17. | * |  | Amendment No 3 to the Stock Incentive Plan2000, is
    incorporated herein by reference to Exhibit 10.2 to the
    Registrants Form 10-Q for the quarter ended
    February 28, 2001.                                                                                                                                                                                                                           
| | 10.18. |   |  | The Greenbrier Companies Code of Business Conduct and Ethics is
    incorporated herein by reference to exhibit 10.26 to the
    Registrants Annual Report on Form 10-K for the year
    ended August 31, 2003.                                                                                                                                                                                                  
| | 10.19. | * |  | Employment Agreement dated February 15, 2004 between James
    T. Sharp and Registrant, is incorporated herein by reference to
    Exhibit 10.27 to the Registrants Annual Report on
    Form 10-K for the year ended August 31, 2004.                                                                                                                                                                           





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##### Table of Contents



EXHIBITS, FINANCIAL STATEMENT
SCHEDULES (continued)


| |        |   |  |                                                                                                                                                                                                                                                                                                                                                                                               
| | ------ | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 10.20. | * |  | Employment Agreement between the Registrant and Mr. William
    A. Furman dated April 20, 2005, is incorporated herein by
    reference to Exhibit 10.1 to the Registrants
    Form 8-K filed April 20, 2005.                                                                                                                                                                                
| | 10.21. |   |  | Settlement Agreement entered into as of April 20, 2005 by
    and among the Registrant, William A. Furman and each of George
    L. Chelius and Eric Epperson as Executor of the Will and Estate
    of Alan James and as Trustee, is incorporated herein by
    reference to Exhibit 10.1 to the Registrants
    Form 8-K filed April 21, 2005.                                             
| | 10.22. |   |  | Stipulation and Order of Dismissal, is incorporated herein by
    reference to Exhibit 10.2 to the Registrants
    Form 8-K filed April 21, 2005.                                                                                                                                                                                                                                            
| | 10.23. |   |  | Stock Purchase Agreement, entered into as of April 20,
    2005, by and among the Registrant, William A. Furman and each of
    George L. Chelius and Eric Epperson as Executor of the Will and
    Estate of Alan James and as Trustee, is incorporated herein by
    reference to Exhibit 10.3 to the Registrants
    Form 8-K filed April 21, 2005.                                       
| | 10.24. |   |  | Form of Lock-Up Agreement, is incorporated herein by reference
    to Exhibit 10.4 to the Registrants Form 8-K
    filed April 21, 2005.                                                                                                                                                                                                                                                     
| | 10.25. |   |  | Registration Rights Agreement, entered into as of April 20,
    2005, by and among the Registrant and each of George L. Chelius
    and Eric Epperson as Executor of the Will and Estate of Alan
    James and as Trustee, is incorporated herein by reference to
    Exhibit 10.5 to the Registrants Form 8-K filed
    April 21, 2005.                                                     
| | 10.26. |   |  | Mutual and General Release, is incorporated herein by reference
    to Exhibit 10.6 to the Registrants Form 8-K
    filed April 21, 2005.                                                                                                                                                                                                                                                    
| | 10.27. |   |  | Termination of Option Agreement, entered into as of
    April 20, 2005, by and among Greenbrier Leasing Corporation
    and each of George L. Chelius and Eric Epperson as Executor of
    the Will and Estate of Alan James and as Trustee, is
    incorporated herein by reference to Exhibit 10.7 to the
    Registrants Form 8-K filed April 21, 2005.                                   
| | 10.28. |   |  | Underwriting Agreement between the Registrant and Bear,
    Stearns & Co. Inc. as representatives of the several
    underwriters dated as of May 5, 2005, is incorporated
    herein by reference to Exhibit 10.1 to the
    Registrants Form 8-K filed May 11, 2005.                                                                                                                       
| | 10.29. |   |  | Purchase Agreement among the Registrant and Banc of America
    Securities LLC and Bear Stearns & Co. Inc., as initial
    purchasers, dated of May 5, 2005, is incorporated herein by
    reference to Exhibit 10.2 to the Registrants
    Form 10-Q filed July 1, 2005.                                                                                                                    
| | 10.30. | * |  | Credit Agreement dated June 29, 2005 among the Registrant,
    Inc., TrentonWorks Limited, each lender from time to time a
    party thereto, Bank of America, N.A., as administrative agent,
    and Bank of America, National Association, acting through its
    Canada branch, is incorporated herein by reference to
    Exhibit 10.1 to the Registrants Form 8-K filed
    July 6, 2005
| | 10.31. | * |  | Form of Director Restricted Share Agreement related to the 2005
    Stock Incentive Plan, is incorporated herein by reference to
    Exhibit 10.1 to the Registrants Form 8-K filed
    August 5, 2005.                                                                                                                                                                                      
| | 10.32. | * |  | Form of Employee Restricted Share Agreement related to the 2005
    Stock Incentive Plan, is incorporated herein by reference to
    Exhibit 10.2 to the Registrants Form 8-K filed
    August 5, 2005.                                                                                                                                                                                      
| | 10.33. | * |  | Form of Change of Control Agreement, is incorporated herein by
    reference to Exhibit 10.3 to the Registrants
    Form 8-K filed August 5, 2005.                                                                                                                                                                                                                                           
| | 10.34. | * |  | 2004 Employee Stock Purchase Plan, is incorporated herein by
    reference to Appendix B to the Registrants Proxy Statement
    on Schedule 14A filed November 25, 2003.                                                                                                                                                                                                                     
| | 10.35. | * |  | 2005 Stock Incentive Plan, is incorporated herein by reference
    to Appendix C to the Registrants Proxy Statement on
    Schedule 14A filed November 24, 2004.                                                                                                                                                                                                                             





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##### Table of Contents



EXHIBITS, FINANCIAL STATEMENT
SCHEDULES (continued)


| |        |  |  |                                                                                                                                       
| | ------ |  |  | --------------------------------------------------------------------------------------------------------------------------------------
| | 10.36* |  |  | Amendment No. 1 to the 2005 Stock Incentive Plan dated
    June 30, 2005.                                                             
| |        |  |  | 12.1   Calculation of ratio of earnings to fixed
    charges.                                                                         
| |        |  |  | 21.1   List of the subsidiaries of the Registrant                                                                                     
| |        |  |  | 23      Consent of
    Deloitte & Touche LLP, independent auditors.                                                                   
| |        |  |  | 31.1(a) Certification pursuant to
    Rule 13(a) - 14(a)                                                                              
| |        |  |  | 31.2(b) Certification pursuant to
    Rule 13(a) - 14(a)                                                                              
| |        |  |  | 32.1(c) Certification pursuant to 18 U.S.C.
    Section 1350 as adopted pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.
| |        |  |  | 32.2(d) Certification pursuant to 18 U.S.C.
    Section 1350 as adopted pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002.



|  |                                                         
|- | --------------------------------------------------------
|* | Management contract or compensatory plan or arrangement.





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##### Table of Contents






SIGNATURES




THE GREENBRIER COMPANIES,
INC.




| |     |                      
| | --- | ---------------------
| | By: | /s/ William A. Furman

| |                                      
| | -------------------------------------
| |                                      
| | William A. Furman                    
| | President and Chief Executive Officer



|                                                                                                                                      |  |  |  |                 
|------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | ----------------
|Signature                                                                                                                             |  |  |  | Date            
|                                                                                                                                     
|/s/ Benjamin R. WhiteleyBenjamin
    R. Whiteley, Chairman of the Board                                                               |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ William A. FurmanWilliam
    A. Furman, President and Chief Executive Officer, Director                                           |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ Victor G. AtiyehVictor
    G. Atiyeh, Director                                                                                    |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ Duane C. McDougallDuane
    C. McDougall, Director                                                                                |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ A. Daniel ONealA.
    Daniel ONeal, Director                                                                                    |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ Charles J. SwindellsCharles
    J. Swindells, Director                                                                            |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ C. Bruce WardC.
    Bruce Ward, Director                                                                                          |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ Donald A. WashburnDonald
    A. Washburn, Director                                                                                |  |  |  | November 2, 2005
|                                                                                                                                     
|/s/ Larry G. BradyLarry
    G. Brady, Sr. Vice President and Chief Financial
    Officer (Principal Financial and Accounting Officer) |  |  |  | November 2, 2005





62                                        The
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##### Table of Contents



SIGNATURES
  GREENBRIER-CONCARRIL, LLC
 Dated: November 2, 2005
    By:
    /s/ Larry G. BradyLarry G. BradyVice President  Signature
    
    Title/s/ William A. Furman
    
    Chairman of the Board of DirectorsWilliam A. Furman
    
    (Principal Executive Officer)/s/ Larry G. Brady
    
    Vice PresidentLarry G. Brady
    
    (Principal Financial and Accounting Officer)/s/ L. Clark Wood
    
    DirectorL. Clark Wood/s/ Robin Bisson
    
    DirectorRobin Bisson




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##### Table of Contents



SIGNATURES
  GREENBRIER MANAGEMENT SERVICES LLC
 Dated: November 2, 2005
    
    By:
    
    Greenbrier Leasing Company LLCSole Member and ManagerBy:
    
    /s/ Larry G. BradyLarry G. BradyVice President
  Signature
    
    Title/s/ William A. Furman
    
    Principal Executive OfficerWilliam A. Furman/s/ Larry G. Brady
    
    Principal Financial and Accounting OfficerLarry G. Brady




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##### Table of Contents



SIGNATURES
  GUNDERSON MARINE LLC
 Dated: November 2, 2005
    By:
    /s/ Larry G. BradyLarry G. BradyVice President  Signature
    
    Title/s/ William A. Furman
    
    ManagerWilliam A. Furman
    
    (Principal Executive Officer)/s/ Larry G. Brady
    
    Vice PresidentLarry G. Brady
    
    (Principal Financial and Accounting Officer)




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##### Table of Contents



SIGNATURES
  GUNDERSON SPECIALTY PRODUCTS LLC
 Dated: November 2, 2005
    
    By:
    
    Gunderson LLC, Sole Member and Sole ManagerBy:
    
    /s/ Larry G. BradyLarry G. BradyVice President
  Signature
    
    Title/s/ William A. Furman
    
    Principal Executive OfficerWilliam A. Furman/s/ Larry G. Brady
    
    Principal Financial and Accounting OfficerLarry G. Brady




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##### Table of Contents



SIGNATURES
  GREENBRIER LEASING, L.P.
 Dated: November 2, 2005
    
    By:
    
    Greenbrier Management Services LLCGeneral PartnerBy:
    
    Greenbrier Leasing Company LLCSole Member and ManagerBy:
    
    /s/ Larry G. BradyLarry G. BradyVice President
  Signature
    
    Title/s/ William A. Furman
    
    Principal Executive OfficerWilliam A. Furman/s/ Larry G. Brady
    
    Principal Financial and Accounting OfficerLarry G. Brady




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##### Table of Contents



SIGNATURES
  GREENBRIER RAILCAR LLC
 Dated: November 2, 2005
    By:
    /s/ Larry G. BradyLarry G. BradyVice President  Signature
    
    Title/s/ William A. Furman
    
    ManagerWilliam A. Furman
    
    (Principal Executive Officer)/s/ Larry G. Brady
    
    Vice PresidentLarry G. Brady
    
    (Principal Financial and Accounting Officer)




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##### Table of Contents



SIGNATURES
  GUNDERSON RAIL SERVICES LLC
 Dated: November 2, 2005
    By:
    /s/ Larry G. BradyLarry G. BradyVice President  Signature
    
    Title/s/ William A. Furman
    
    ManagerWilliam A. Furman
    
    (Principal Executive Officer)/s/ Larry G. Brady
    
    Vice PresidentLarry G. Brady
    
    (Principal Financial and Accounting Officer)




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##### Table of Contents



SIGNATURES
  AUTOSTACK COMPANY LLC
 Dated: November 2, 2005
    By:
    /s/ Larry G. BradyLarry G. BradyVice President  Signature
    
    Title/s/ William A. Furman
    
    Chief Executive Officer and ManagerWilliam A. Furman
    
    (Principal Executive Officer)/s/ Larry G. Brady
    
    Vice PresidentLarry G. Brady
    
    (Principal Financial and Accounting Officer)




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##### Table of Contents



SIGNATURES
  GUNDERSON LLC
 Dated: November 2, 2005
    By:
    /s/ Larry G. BradyLarry G. BradyVice President  Signature
    
    Title/s/ William A. Furman
    
    ManagerWilliam A. Furman
    
    (Principal Executive Officer)/s/ Larry G. Brady
    
    Vice PresidentLarry G. Brady
    
    (Principal Financial and Accounting Officer)