cai-20200930x10q
false--12-31Q3202000013884302026-02-012023-06-012022-09-012023-09-012023-10-012043-09-012045-09-012023-04-012021-08-012020-12-012021-06-012023-10-012026-02-010.0208300013884302018-10-310001388430us-gaap:CommonStockMember2019-07-012019-09-300001388430us-gaap:CommonStockMember2020-07-012020-09-300001388430us-gaap:CommonStockMember2020-04-012020-06-300001388430us-gaap:CommonStockMember2020-01-012020-03-310001388430us-gaap:CommonStockMember2019-04-012019-06-300001388430us-gaap:CommonStockMember2019-01-012019-03-310001388430cai:EmployeeStockPurchasePlanMember2020-07-012020-09-300001388430cai:EmployeeStockPurchasePlanMember2020-01-012020-09-300001388430us-gaap:RetainedEarningsMember2020-09-300001388430us-gaap:AdditionalPaidInCapitalMember2020-09-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-09-300001388430us-gaap:RetainedEarningsMember2020-06-300001388430us-gaap:AdditionalPaidInCapitalMember2020-06-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-06-3000013884302020-06-300001388430us-gaap:RetainedEarningsMember2020-03-310001388430us-gaap:AdditionalPaidInCapitalMember2020-03-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-3100013884302020-03-310001388430us-gaap:RetainedEarningsMember2019-12-310001388430us-gaap:AdditionalPaidInCapitalMember2019-12-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310001388430us-gaap:RetainedEarningsMember2019-09-300001388430us-gaap:AdditionalPaidInCapitalMember2019-09-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-09-300001388430us-gaap:RetainedEarningsMember2019-06-300001388430us-gaap:AdditionalPaidInCapitalMember2019-06-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-06-3000013884302019-06-300001388430us-gaap:RetainedEarningsMember2019-03-310001388430us-gaap:AdditionalPaidInCapitalMember2019-03-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-03-3100013884302019-03-310001388430us-gaap:RetainedEarningsMember2018-12-310001388430us-gaap:AdditionalPaidInCapitalMember2018-12-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2018-12-310001388430us-gaap:PreferredStockMember2020-09-300001388430us-gaap:CommonStockMember2020-09-300001388430us-gaap:PreferredStockMember2020-06-300001388430us-gaap:CommonStockMember2020-06-300001388430us-gaap:PreferredStockMember2020-03-310001388430us-gaap:CommonStockMember2020-03-310001388430us-gaap:PreferredStockMember2019-12-310001388430us-gaap:CommonStockMember2019-12-310001388430us-gaap:PreferredStockMember2019-09-300001388430us-gaap:CommonStockMember2019-09-300001388430us-gaap:PreferredStockMember2019-06-300001388430us-gaap:CommonStockMember2019-06-300001388430us-gaap:PreferredStockMember2019-03-310001388430us-gaap:CommonStockMember2019-03-310001388430us-gaap:PreferredStockMember2018-12-310001388430us-gaap:CommonStockMember2018-12-310001388430us-gaap:EmployeeStockOptionMember2019-12-310001388430us-gaap:EmployeeStockOptionMember2018-12-310001388430us-gaap:EmployeeStockOptionMember2020-01-012020-06-300001388430us-gaap:EmployeeStockOptionMember2019-09-300001388430cai:EmployeeStockPurchasePlanMember2019-06-300001388430cai:RestrictedStockAndPerformanceStockMember2019-12-310001388430cai:EmployeesMembercai:RestrictedStockAndPerformanceStockMembercai:EachAnniversaryOfGrantDateMember2020-01-012020-09-300001388430us-gaap:EmployeeStockOptionMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2020-01-012020-09-300001388430us-gaap:EmployeeStockOptionMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2020-01-012020-09-300001388430srt:DirectorMemberus-gaap:RestrictedStockMember2020-01-012020-09-300001388430srt:DirectorMemberus-gaap:EmployeeStockOptionMember2020-01-012020-09-300001388430cai:EmployeesMemberus-gaap:RestrictedStockMember2020-01-012020-09-300001388430us-gaap:NonUsMember2020-07-012020-09-300001388430srt:EuropeMember2020-07-012020-09-300001388430srt:AsiaMember2020-07-012020-09-300001388430country:US2020-07-012020-09-300001388430country:SG2020-07-012020-09-300001388430country:KR2020-07-012020-09-300001388430country:FR2020-07-012020-09-300001388430country:CH2020-07-012020-09-300001388430cai:RailLeaseRevenueMember2020-07-012020-09-300001388430cai:ContainerLeaseRevenueMember2020-07-012020-09-300001388430us-gaap:NonUsMember2020-01-012020-09-300001388430srt:EuropeMember2020-01-012020-09-300001388430srt:AsiaMember2020-01-012020-09-300001388430country:US2020-01-012020-09-300001388430country:SG2020-01-012020-09-300001388430country:KR2020-01-012020-09-300001388430country:FR2020-01-012020-09-300001388430country:CH2020-01-012020-09-300001388430cai:RailLeaseRevenueMember2020-01-012020-09-300001388430cai:ContainerLeaseRevenueMember2020-01-012020-09-300001388430us-gaap:NonUsMember2019-07-012019-09-300001388430srt:EuropeMember2019-07-012019-09-300001388430srt:AsiaMember2019-07-012019-09-300001388430country:US2019-07-012019-09-300001388430country:SG2019-07-012019-09-300001388430country:KR2019-07-012019-09-300001388430country:FR2019-07-012019-09-300001388430country:CH2019-07-012019-09-300001388430cai:RailLeaseRevenueMember2019-07-012019-09-300001388430cai:ContainerLeaseRevenueMember2019-07-012019-09-300001388430us-gaap:NonUsMember2019-01-012019-09-300001388430srt:EuropeMember2019-01-012019-09-300001388430srt:AsiaMember2019-01-012019-09-300001388430country:US2019-01-012019-09-300001388430country:SG2019-01-012019-09-300001388430country:KR2019-01-012019-09-300001388430country:FR2019-01-012019-09-300001388430country:CH2019-01-012019-09-300001388430cai:RailLeaseRevenueMember2019-01-012019-09-300001388430cai:ContainerLeaseRevenueMember2019-01-012019-09-300001388430us-gaap:ContainersMember2020-09-300001388430us-gaap:RailroadTransportationEquipmentMember2020-09-300001388430us-gaap:OtherTransportationEquipmentMember2020-09-300001388430cai:TotalContainersMember2020-09-300001388430cai:RefrigeratedContainersMember2020-09-300001388430cai:DryContainersMember2020-09-300001388430us-gaap:RailroadTransportationEquipmentMember2019-12-310001388430us-gaap:OtherTransportationEquipmentMember2019-12-310001388430cai:TotalContainersMember2019-12-310001388430cai:RefrigeratedContainersMember2019-12-310001388430cai:DryContainersMember2019-12-310001388430cai:SeriesCumulativePreferredStockMember2020-09-300001388430cai:SeriesBCumulativePreferredStockMember2020-09-300001388430cai:SeriesCumulativePreferredStockMember2019-12-310001388430cai:SeriesBCumulativePreferredStockMember2019-12-310001388430cai:SeriesCumulativePreferredStockMember2019-01-012019-12-310001388430cai:SeriesBCumulativePreferredStockMember2019-01-012019-12-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-04-012020-06-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-03-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-07-012019-09-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-04-012019-06-300001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-01-012019-03-310001388430us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-07-012020-09-300001388430us-gaap:EstimateOfFairValueFairValueDisclosureMember2020-09-300001388430us-gaap:EstimateOfFairValueFairValueDisclosureMember2019-12-310001388430us-gaap:RiskLevelMediumMember2019-12-310001388430us-gaap:RiskLevelLowMember2019-12-310001388430us-gaap:RiskLevelHighMember2019-12-310001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:LoansPayableMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-09-300001388430us-gaap:FairValueInputsLevel2Memberus-gaap:CollateralizedDebtObligationsMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2020-09-300001388430us-gaap:FairValueInputsLevel2Membercai:FixedRateTermLoansMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2020-09-300001388430us-gaap:SecuredDebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-09-300001388430us-gaap:CollateralizedDebtObligationsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-09-300001388430us-gaap:AssetBackedSecuritiesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-09-300001388430cai:FixedRateTermLoansMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:LoansPayableMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001388430us-gaap:FairValueInputsLevel2Memberus-gaap:CollateralizedDebtObligationsMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2019-12-310001388430us-gaap:FairValueInputsLevel2Memberus-gaap:AssetBackedSecuritiesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2019-12-310001388430us-gaap:FairValueInputsLevel2Membercai:FixedRateTermLoansMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2019-12-310001388430us-gaap:SecuredDebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001388430us-gaap:CollateralizedDebtObligationsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001388430us-gaap:AssetBackedSecuritiesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001388430cai:FixedRateTermLoansMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001388430cai:CaiRailIncMemberus-gaap:RevolvingCreditFacilityMember2020-07-020001388430cai:ConsortiumOfBanksMemberus-gaap:RevolvingCreditFacilityMember2020-09-300001388430us-gaap:DiscontinuedOperationsHeldforsaleMember2020-07-012020-09-300001388430us-gaap:DiscontinuedOperationsHeldforsaleMember2020-04-012020-06-300001388430us-gaap:RiskLevelMediumMember2020-09-300001388430us-gaap:RiskLevelLowMember2020-09-300001388430us-gaap:AssetBackedSecuritiesMember2020-09-252020-09-250001388430us-gaap:PerformanceSharesMember2020-01-012020-09-300001388430cai:RestrictedStockAndPerformanceStockMember2020-09-300001388430us-gaap:RetainedEarningsMember2020-04-012020-06-300001388430us-gaap:RetainedEarningsMember2020-01-012020-03-310001388430us-gaap:RetainedEarningsMember2019-07-012019-09-300001388430us-gaap:RetainedEarningsMember2019-04-012019-06-300001388430us-gaap:RetainedEarningsMember2019-01-012019-03-310001388430us-gaap:RetainedEarningsMember2020-07-012020-09-300001388430us-gaap:InterestRateSwapMember2020-07-012020-09-300001388430us-gaap:InterestRateSwapMember2019-09-300001388430us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-09-300001388430us-gaap:FairValueMeasurementsRecurringMember2020-09-300001388430us-gaap:OtherComprehensiveIncomeMember2020-07-012020-09-300001388430us-gaap:InterestExpenseMember2020-07-012020-09-300001388430us-gaap:OtherComprehensiveIncomeMember2020-01-012020-09-300001388430us-gaap:InterestExpenseMember2020-01-012020-09-300001388430us-gaap:InterestRateSwapMember2020-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:LoansPayableMember2020-01-012020-09-300001388430cai:TermLoanDueOctober2023Memberus-gaap:LoansPayableMember2020-01-012020-09-300001388430cai:TermLoanDueJune2021Memberus-gaap:LoansPayableMember2020-01-012020-09-300001388430cai:TermLoanDueDecember2020Memberus-gaap:LoansPayableMember2020-01-012020-09-300001388430cai:TermLoanDueAugust2021Memberus-gaap:LoansPayableMember2020-01-012020-09-300001388430cai:TermLoanDueApril2023Memberus-gaap:LoansPayableMember2020-01-012020-09-300001388430cai:Series20201AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2020-01-012020-09-300001388430cai:Series20182AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2020-01-012020-09-300001388430cai:CaiRailIncMemberus-gaap:RevolvingCreditFacilityMember2020-01-012020-09-300001388430cai:CaiInternationalGmbhMemberus-gaap:RevolvingCreditFacilityMember2020-01-012020-09-300001388430us-gaap:SecuredDebtMember2020-01-012020-09-300001388430us-gaap:RevolvingCreditFacilityMember2020-01-012020-09-300001388430us-gaap:CollateralizedDebtObligationsMember2020-01-012020-09-300001388430cai:CalFundingIvLimitedMembercai:ClassBAssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2020-09-090001388430cai:CalFundingIvLimitedMembercai:ClassAssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2020-09-090001388430cai:CalFundingIvLimitedMemberus-gaap:AssetBackedSecuritiesMember2020-01-012020-09-300001388430us-gaap:OperatingSegmentsMembercai:RailLeasingMember2020-07-012020-09-300001388430us-gaap:OperatingSegmentsMembercai:ContainerLeasingMember2020-07-012020-09-300001388430us-gaap:OperatingSegmentsMembercai:RailLeasingMember2020-01-012020-09-300001388430us-gaap:OperatingSegmentsMembercai:ContainerLeasingMember2020-01-012020-09-300001388430us-gaap:OperatingSegmentsMembercai:RailLeasingMember2019-07-012019-09-300001388430us-gaap:OperatingSegmentsMembercai:ContainerLeasingMember2019-07-012019-09-300001388430us-gaap:OperatingSegmentsMembercai:RailLeasingMember2019-01-012019-09-300001388430us-gaap:OperatingSegmentsMembercai:ContainerLeasingMember2019-01-012019-09-300001388430cai:SecondLargestMemberus-gaap:AccountsReceivableMemberus-gaap:CustomerConcentrationRiskMember2020-07-012020-09-300001388430cai:LargestCustomerMemberus-gaap:AccountsReceivableMemberus-gaap:CustomerConcentrationRiskMember2020-07-012020-09-300001388430cai:SecondLargestMemberus-gaap:AccountsReceivableMemberus-gaap:CustomerConcentrationRiskMember2020-01-012020-09-300001388430cai:LargestCustomerMemberus-gaap:AccountsReceivableMemberus-gaap:CustomerConcentrationRiskMember2020-01-012020-09-3000013884302019-09-3000013884302018-12-310001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:ContainersMember2020-09-300001388430srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember2020-09-300001388430srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember2019-12-310001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2019-09-300001388430srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember2019-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2018-12-310001388430srt:ConsolidatedEntityExcludingVariableInterestEntitiesVIEMember2018-12-310001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2020-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2019-12-310001388430us-gaap:OperatingSegmentsMembercai:RailSegmentsMember2020-09-300001388430us-gaap:OperatingSegmentsMembercai:ContainerLeasingMember2020-09-300001388430us-gaap:OperatingSegmentsMembercai:RailSegmentsMember2019-12-310001388430us-gaap:OperatingSegmentsMembercai:LogisticsMember2019-12-310001388430us-gaap:OperatingSegmentsMembercai:ContainerLeasingMember2019-12-310001388430srt:MaximumMembercai:EmployeeStockPurchasePlanMember2020-07-012020-09-300001388430us-gaap:EmployeeStockOptionMember2020-07-012020-09-300001388430cai:RestrictedStockAndPerformanceStockMember2020-07-012020-09-300001388430srt:MaximumMembercai:EmployeeStockPurchasePlanMember2020-01-012020-09-300001388430us-gaap:EmployeeStockOptionMember2020-01-012020-09-300001388430cai:RestrictedStockAndPerformanceStockMember2020-01-012020-09-300001388430us-gaap:EmployeeStockOptionMember2019-07-012019-09-300001388430cai:RestrictedStockAndPerformanceStockMember2019-07-012019-09-300001388430us-gaap:EmployeeStockOptionMember2019-01-012019-09-300001388430cai:RestrictedStockAndPerformanceStockMember2019-01-012019-09-300001388430us-gaap:AdditionalPaidInCapitalMember2020-07-012020-09-300001388430us-gaap:AdditionalPaidInCapitalMember2020-04-012020-06-3000013884302020-04-012020-06-300001388430us-gaap:AdditionalPaidInCapitalMember2020-01-012020-03-310001388430us-gaap:AdditionalPaidInCapitalMember2019-07-012019-09-300001388430us-gaap:AdditionalPaidInCapitalMember2019-04-012019-06-3000013884302019-04-012019-06-300001388430us-gaap:AdditionalPaidInCapitalMember2019-01-012019-03-3100013884302019-01-012019-03-310001388430us-gaap:CommonStockMember2020-01-012020-09-300001388430cai:SeriesCumulativePreferredStockMember2020-01-012020-09-300001388430cai:SeriesBCumulativePreferredStockMember2020-01-012020-09-3000013884302020-10-310001388430us-gaap:RailroadTransportationEquipmentMember2020-01-012020-09-300001388430cai:FinanceLeaseMemberus-gaap:CustomerConcentrationRiskMember2020-01-012020-09-300001388430cai:FinanceLeaseMemberus-gaap:CustomerConcentrationRiskMember2019-01-012019-12-310001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:ContainersMember2020-07-012020-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:ContainersMember2020-01-012020-09-3000013884302020-01-012020-03-310001388430us-gaap:SegmentDiscontinuedOperationsMember2020-07-012020-09-300001388430us-gaap:SegmentDiscontinuedOperationsMember2020-01-012020-09-300001388430us-gaap:SegmentDiscontinuedOperationsMember2019-07-012019-09-300001388430us-gaap:SegmentDiscontinuedOperationsMember2019-01-012019-09-300001388430cai:CaiRailIncMemberus-gaap:RevolvingCreditFacilityMember2020-09-300001388430cai:CaiInternationalGmbhMemberus-gaap:RevolvingCreditFacilityMember2020-09-300001388430us-gaap:RevolvingCreditFacilityMember2020-09-300001388430cai:CaiRailIncMemberus-gaap:RevolvingCreditFacilityMember2019-12-310001388430us-gaap:RevolvingCreditFacilityMember2019-12-310001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:LoansPayableMember2020-09-300001388430cai:TermLoanDueOctober2023Memberus-gaap:LoansPayableMember2020-09-300001388430cai:TermLoanDueJune2021Memberus-gaap:LoansPayableMember2020-09-300001388430cai:TermLoanDueDecember2020Memberus-gaap:LoansPayableMember2020-09-300001388430cai:TermLoanDueAugust2021Memberus-gaap:LoansPayableMember2020-09-300001388430cai:TermLoanDueApril2023Memberus-gaap:LoansPayableMember2020-09-300001388430cai:Series20201AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2020-09-300001388430cai:Series20182AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2020-09-300001388430us-gaap:SecuredDebtMember2020-09-300001388430us-gaap:CollateralizedDebtObligationsMember2020-09-3000013884302020-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:LoansPayableMember2019-12-310001388430cai:TermLoanDueOctober2023Memberus-gaap:LoansPayableMember2019-12-310001388430cai:TermLoanDueJune2021Memberus-gaap:LoansPayableMember2019-12-310001388430cai:TermLoanDueDecember2020Memberus-gaap:LoansPayableMember2019-12-310001388430cai:TermLoanDueAugust2021Memberus-gaap:LoansPayableMember2019-12-310001388430cai:TermLoanDueApril2023Memberus-gaap:LoansPayableMember2019-12-310001388430cai:Series20182AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001388430cai:Series20181AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001388430cai:Series201701AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001388430cai:Series20131AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001388430cai:Series20121AssetBackedNotesMemberus-gaap:AssetBackedSecuritiesMember2019-12-310001388430cai:CaiInternationalGmbhMemberus-gaap:RevolvingCreditFacilityMember2019-12-310001388430us-gaap:SecuredDebtMember2019-12-310001388430us-gaap:CollateralizedDebtObligationsMember2019-12-3100013884302019-12-3100013884302020-07-012020-09-3000013884302019-07-012019-09-3000013884302019-01-012019-09-3000013884302020-01-012020-09-300001388430us-gaap:EmployeeStockOptionMember2020-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:ContainersMember2019-07-012019-09-300001388430us-gaap:VariableInterestEntityPrimaryBeneficiaryMemberus-gaap:ContainersMember2019-01-012019-09-300001388430us-gaap:DiscontinuedOperationsHeldforsaleMember2019-12-31xbrli:sharesxbrli:purecai:customercai:itemiso4217:USDxbrli:sharesiso4217:USD

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

 

x        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

or

o        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-33388

CAI International, Inc.

(Exact name of registrant as specified in its charter)

Delaware

 

94-3109229

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

 

Steuart Tower, 1 Market Plaza, Suite 2400

 

 

San Francisco, California

 

94105

(Address of principal executive offices)

 

(Zip Code)

415-788-0100

(Registrant’s telephone number, including area code)

None

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

 

Le

Title of each class

Trading symbols

Name of exchange on which registered

Common Stock, par value $0.0001 per share

CAI

New York Stock Exchange

8.50% Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Stock, par value $0.0001 per share

CAI-PA

New York Stock Exchange

8.50% Series B Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Stock, par value $0.0001 per share

CAI-PB

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  x    No   o

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  x    No   o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

o

Accelerated filer

x

Non-accelerated filer

o  

Smaller reporting company

o

Emerging growth company

o

If an emerging growth company, indicate by check mark of the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o   No   x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock

 

October 31, 2020

Common Stock, $0.0001 par value per share

 

17,742,443 shares

1


CAI INTERNATIONAL, INC.

INDEX

 

 

 

Page No.

Part I — Financial Information

4

Item 1.

Financial Statements (Unaudited)

4

 

Consolidated Balance Sheets at September 30, 2020 and December 31, 2019

4

Consolidated Statements of Operations for the three and nine months ended September 30, 2020 and 2019

6

 

Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2020 and 2019

7

Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2020 and 2019

8

 

Consolidated Statements of Cash Flows for the nine months ended September 30, 2020 and 2019

10

 

Notes to Unaudited Consolidated Financial Statements

12

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

26

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

37

Item 4.

Controls and Procedures

37

Part II — Other Information

38

Item 1.

Legal Proceedings

38

Item 1A.

Risk Factors

38

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

39

Item 3.

Defaults Upon Senior Securities

39

Item 4.

Mine Safety Disclosures

39

Item 5.

Other Information

39

Item 6.

Exhibits

40

Signatures

41

 


2


SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q contains certain forward-looking statements, including, without limitation, statements concerning the conditions in our industry, our operations, our economic performance and financial condition, including, in particular, statements relating to our business, operations, growth strategy, service development efforts, our plans regarding our logistics business and the impact of the novel coronavirus (COVID-19) on our business, financial condition, liquidity and results of operations. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for certain forward-looking statements so long as such information is identified as forward-looking and is accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in the information. When used in this Quarterly Report on Form 10-Q, the words “may,” “might,” “should,” “estimate,” “project,” “plan,” “anticipate,” “expect,” “intend,” “outlook,” “believe” and other similar expressions are intended to identify forward-looking statements and information. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. These forward-looking statements are based on estimates and assumptions by our management that, although we believe to be reasonable, are inherently uncertain and subject to a number of risks and uncertainties. These risks and uncertainties include, without limitation, those in our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the Securities and Exchange Commission (SEC) on March 5, 2020, this Quarterly Report on Form 10-Q and our other reports filed with the SEC. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. Reference is also made to such risks and uncertainties detailed from time to time in our other filings with the SEC.


3


PART I — FINANCIAL INFORMATION

 

ITEM 1.  FINANCIAL STATEMENTS

CAI INTERNATIONAL, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share information)

(UNAUDITED)

September 30,

December 31,

2020

2019

Assets

Current assets

Cash

$

15,516 

$

19,870 

Current portion of restricted cash

316,915 

-

Cash held by variable interest entities

26,784 

26,594 

Accounts receivable, net of allowance for doubtful accounts of $418 and

$7,671 at September 30, 2020 and December 31, 2019, respectively

65,574 

72,984 

Current portion of net investment in finance leases

75,240 

71,274 

Prepaid expenses and other current assets

15,746 

9,606 

Assets held for sale

-

37,781 

Total current assets

515,775 

238,109 

Restricted cash

23,232 

26,775 

Rental equipment, net of accumulated depreciation of $676,330 and

$620,990 at September 30, 2020 and December 31, 2019, respectively

2,018,142 

2,102,839 

Net investment in finance leases

455,168 

496,094 

Financing receivable

51,384 

30,693 

Other non-current assets

5,493 

7,255 

Total assets (1)

$

3,069,194 

$

2,901,765 

Liabilities and Stockholders' Equity

Current liabilities

Accounts payable

$

3,868 

$

4,534 

Accrued expenses and other current liabilities

26,423

25,206 

Unearned revenue

6,851 

6,405 

Current portion of debt

502,013 

218,094 

Rental equipment payable

89,634 

25,137 

Liabilities held for sale

-

8,752 

Total current liabilities

628,789

288,128 

Debt

1,706,170 

1,880,122 

Derivative instruments

1,820 

-

Deferred income tax liability

29,626

35,376 

Other non-current liabilities

3,759 

4,899 

Total liabilities (2)

2,370,164

2,208,525 

Stockholders' equity

Preferred stock, par value $0.0001 per share; authorized 10,000,000

8.50% Series A fixed-to-floating rate cumulative redeemable perpetual preferred stock, issued and

outstanding 2,199,610 shares, at liquidation preference

54,990 

54,990 

8.50% Series B fixed-to-floating rate cumulative redeemable perpetual preferred stock, issued and

outstanding 1,955,000 shares, at liquidation preference

48,875 

48,875 

Common stock, par value $0.0001 per share; authorized 84,000,000 shares; issued and outstanding

17,742,443 and 17,479,127 shares at September 30, 2020 and December 31, 2019, respectively

2 

2 

Additional paid-in capital

106,990 

102,709 

Accumulated other comprehensive loss

(7,560)

(6,630)

Retained earnings

495,733

493,294 

Total stockholders' equity

699,030

693,240 

Total liabilities and stockholders' equity

$

3,069,194 

$

2,901,765 


4


(1)Total assets at September 30, 2020 and December 31, 2019 include the following assets of certain variable interest entities (VIEs) that can only be used to settle the liabilities of those VIEs: Cash, $26,784 and $26,594; Net investment in finance leases, $3,326 and $4,790; and Rental equipment, net of accumulated depreciation, $84,938, and $101,907, respectively.

(2)Total liabilities at September 30, 2020 and December 31, 2019 include the following VIE liabilities for which the VIE creditors do not have recourse to CAI International, Inc.: Current portion of debt, $33,899 and $26,931; Debt, $74,602 and $100,849, respectively.

See accompanying notes to unaudited consolidated financial statements. 


5


CAI INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(UNAUDITED)

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

Revenue

Container lease revenue

$

73,890 

$

75,535 

$

212,446 

$

225,332 

Rail lease revenue

5,162 

5,871 

17,247 

20,214 

Total revenue

79,052 

81,406 

229,693 

245,546 

Operating expenses

Depreciation of rental equipment

30,428 

28,030 

86,322 

89,629 

Impairment of rental equipment

-

25,632 

19,724 

32,955 

Storage, handling and other expenses

6,686 

8,125 

18,908 

18,444 

Gain on sale of rental equipment

(2,729)

(3,168)

(6,451)

(12,265)

Administrative expenses

6,388 

9,278 

21,441 

26,501 

Total operating expenses

40,773 

67,897 

139,944 

155,264 

Operating income

38,279 

13,509 

89,749 

90,282 

Other expenses

Net interest expense

16,630 

23,102 

54,604 

70,165 

Write-off of debt issuance costs

3,641 

-

3,641 

-

Other (income) expense

(306)

380 

(157)

537 

Total other expenses

19,965 

23,482 

58,088 

70,702 

Income (loss) before income taxes

18,314 

(9,973)

31,661 

19,580 

Income tax expense (benefit)

1,349 

(4,830)

(594)

(2,098)

Income (loss) from continuing operations

16,965 

(5,143)

32,255 

21,678 

Loss from discontinued operations, net of income taxes

(1,522)

(636)

(18,768)

(3,389)

Net income (loss)

15,443 

(5,779)

13,487 

18,289 

Preferred stock dividends

2,207 

2,207 

6,621 

6,621 

Net income (loss) attributable to CAI common stockholders

$

13,236 

$

(7,986)

$

6,866 

$

11,668 

Amounts attributable to CAI common stockholders

Net income (loss) from continuing operations

$

14,758 

$

(7,350)

$

25,634 

$

15,057 

Net loss from discontinued operations

(1,522)

(636)

(18,768)

(3,389)

Net income (loss) attributable to CAI common stockholders

$

13,236 

$

(7,986)

$

6,866 

$

11,668 

Net income (loss) per share attributable to CAI

common stockholders

Basic

Continuing operations

$

0.84 

$

(0.42)

$

1.47 

$

0.84 

Discontinued operations

(0.09)

(0.04)

(1.08)

(0.19)

Total basic

$

0.75 

$

(0.46)

$

0.39 

$

0.65 

Diluted

Continuing operations

$

0.83 

$

(0.42)

$

1.45 

$

0.83 

Discontinued operations

(0.08)

(0.04)

(1.06)

(0.19)

Total diluted

$

0.75 

$

(0.46)

$

0.39 

$

0.64 

Weighted average shares outstanding

Basic

17,570 

17,330 

17,491 

17,850 

Diluted

17,706 

17,330 

17,664 

18,122 

See accompanying notes to unaudited consolidated financial statements.

6


CAI INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

(UNAUDITED)

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019