XTRA: Earnings News Release News from XTRA Corporation FOR IMMEDIATE RELEASE For Information Contact: January 29, 1998 XTRA Corporation Michael J. Soja Vice President and Chief Financial Officer Tel:(617) 367-781O PRESS RELEASE Earnings per share up 38% over last year's first quarter results; the highest first quarter earnings per share in the Company's history. Boston, Jan. 29, 1998 -- XTRA Corporation (NYSE: XTR) achieved strong earnings for the fiscal first quarter ended December 31, 1997, with a double digit increase in earnings per share over last year's first quarter results. XTRA's President and Chief Executive Officer, Lewis Rubin, stated, "Business conditions and earnings are generally positive, and XTRA is well-positioned to benefit from the improved transportation environment. The first quarter of fiscal 1998 is the fifth consecutive quarter where overall utilization has equaled or exceeded the compamble quarter of the prior year and represents the highest first quarter earnings per share in the Company's history." Specific highlights include: * Fiscal first quarter ended December 31, 1997 net income of $18 million or $1.17 diluted eamings per share on revenues of $121 million, a 38% increase in earnings per share over the same quarter of the prior fiscal year. Net income for the same quarter of fiscal year 1997 was $13 million or S.85 diluted earnings per share on revenues of $111 million. * Overall equipment utilization for the first quarter of fiscal year 1998 averaged 90% compared to 85% for the first quarter of fiscal year 1997. Business Summary and Outlook For the past six consecutive quarters, XTRA's North American businesses' equipment utilization has improved. North American uutilization for the first quarter of 1998 averaged 91%, as compared to 88% in the comparable 1997 quarter. Strong levels of domestic freight are expected to continue, partly as a result of ongoing moderate economic growth. XTRA's international marine container utilization averaged 84% in the first quarter of fiscal 1998, compared to 78% in the first quarter of fiscal 1997. This represents the third consecutive quarter that XTRA's international marine container utilization has improved. "While we see the increases in utilization as a positive indicator that the marine container leasing environment may be improving," said Lewis Rubin, "we continue to experience competitive lease rates." Overall utilization is expected to be approximately 85% for the month of January, 3% higher than the same month of the prior fiscal year. Historically, the second and third fiscal quarters reflect the seasonality of the transportation business and represent a period of lower utilization and hence profitability. "It is anticipated that capital spending for new equipment will be lower in fiscal year 1998 due to the significant level of equipment additions during fiscal year 1997," Mr Rubin stated. XTRA currently has approximately $102 million committed for fiscal year 1998 capital expenditures. This amount may be increased as a result of business conditions. XTRA leases, primarily on an operating basis, over-the-road trailers, marine containers, and intermodal equipment, including intermodal trailers, chassis, and domestic containers. This press release contains, in addition to historical information, certain forward-looking statements that involve risks and uncertainties. These include statements relating to such factors as expected demand and utilization, business conditions, and capital expenditures. Such statements are based on managemen's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Factors that may cause such a difference include, but are not limited to, the variability of the Company's revenues and its fixed operating expenses, the impact of the North American and International economies on revenues, lease rates and utilization; and fluctuations in interest rates and foreign cxchangs rates. These risks are discussed under the caption "Cautionary Statements for Purposes of the `Safe Harbor' Provisions of the Private Securities Litigation Reform Act of 1995" in the Company's Annual Report on Form 1O-K for the fiscal year ended September 30, 1997 on file with the SEC. XTRA CORPORATION AND SUBSIDIARIES CONSOLIDATED INCOME STATEMENTS (Millions of dollars except per share and share amounts) (Unaudited) Three Months Ended December 31, (Unaudited) 1997 1996 Revenues $ 121 $ 111 Operating expenses Depreciation on rental equipment 38 36 Rental equipment operating expense 27 26 Selling and administrative expense 11 11 76 73 Operating income 45 38 Interest expense 15 16 Income before provision for income taxes 30 22 Provision for income taxes 12 9 Net income $ 18 $ 13 Basic earnings per share $ 1.18 $ 0.85 Weighted average basic shares outstanding (in millions) 15.3 15.3 Diluted earnings per share $ 1.17 $ 0.85 Weighted average diluted shares outstanding (in millions) 15.4 15.3 XTRA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Millions of dollars) December 31, September 30, 1997 1997 (Unaudited) Assets Property and Equipment, net $ 1,422 $ 1,454 Receivables, net 112 108 Other Assets 20 23 Total Assets $ 1,554 $ 1,585 Liabilities and Stockholders' Equity Liabilities Debt $ 853 $ 892 Deferred Income Taxes 261 252 Other Liabilities 68 81 Stockholders' Equity 372 360 Total Liabilities & Stockholders' Equity $ 1,554 $ 1,585 Net Debt Outstanding $ 849 $ 888 XTRA CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Millions of dollars) (Unaudited) Three Months Ended December 31, 1997 1996 Cash Provided from Operations $ 61 $ 51 Cash Used for Investment Activities (19) (20) Cash Used for Financing Activities (3) (16) (Increase)/Decrease in Net Debt Outstanding (Debt- Cash) $ 39 $ 15 End