Good day, and welcome to today’s teleconference. At this time, all participants are in a listen-only mode. Later, there will be an opportunity to ask questions during our Q&A session. [Operator Instructions]. I will now turn the call over to the Vice President of Finance and Treasurer, James Perry. Please go ahead, sir.

Thank you, Kurtis. Good morning from Dallas, Texas, and welcome to the Trinity Industries’ second quarter 2008 results conference call. I am James Perry, Vice President of Finance and Treasurer for Trinity. Thank you for being with us today. In addition to me, you will hear today from Tim Wallace, Chairman, Chief Executive Officer and President; Steve Menzies, Senior Vice President and Group President of the Rail Group; and Bill McWhirter, Senior Vice President and Chief Financial Officer. Following that, we will move to the Q&A session. Also in the room today is Charles Michel, Vice President of Controller and Chief Accounting Officer. A replay of this conference call will be available starting one hour after the conference call ends today through midnight on Thursday, August 7th. The replay number is 402-220-0121. Replay of this broadcast will also be available on our website located at www.trin.net. Before we get started, let me remind you that today’s conference call contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995 and include statements as to estimates, expectations, intentions and predictions of future financial performance. Statements that are not historical facts are forward-looking. Participants are directed to Trinity’s Form 10-K and other SEC filings for description of certain of the business issues and risks, a change in any of which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. On June 30, 2008, our borrowings at the corporate level were the $450 million of convertible subordinated notes, $201.5 million of senior notes, and $3.3 million of other indebtedness. The leasing company’s debt included $570.2 million of promissory notes, $327 million of secured railcar equipment notes, $76.3 million outstanding under our railcar leasing warehouse facility, and $61.4 million of equipment trust certificates. Our total debt-to-total-capital ratio was 47.7% on June 30, 2008, as compared to 46% at June 30, 2007. Net of cash, on net debt-to-total capital ratio was 44.4% on June 30, 2008, as compared to 41.3% at June 30, 2007. On June 30, 2008 our cash position was $210 million. In December 2007, Trinity announced authorization for a $200 million share repurchase program through 2009. During the second quarter, we did not purchase any shares under this program, instead using our capital for investments in our Leasing and Manufacturing businesses. Our cumulative purchase through the second quarter totaled 575,300 shares for $15.1 million. We will provide details of our purchases and we report our results at the end of each quarter. Now here’s Tim Wallace.

Thank you, James, and good morning everyone. I am very pleased with our results for the second quarter. Our performance reflects the success of the initiatives that we put in place during the past few years, including expanded diversification of our portfolio. Our Barge and Wind Tower businesses are examples of this. During the second quarter, our Inland Barge Group earned $27 million and our Energy Equipment Group earned $25 million. These earnings are significantly greater for each group than earnings during the same quarter last year. Despite a highly competitive railcar market, our Rail Group generated an operating profit of $72 million for the second quarter. This was consistent with our first quarter results. The Rail Group’s operating margin was a solid 12.3%. Industry orders for railcars in the second quarter were up 5% year-over-year. Our quarterly order rate was more than double what it was last year during the second quarter and 80% more than the first quarter of this year. I am very pleased with the fact that our railcar backlog increased. This is a result of our focus on obtaining orders that help us maintain production continuity and minimize line change over. Industry pricing remain highly competitive indicating a challenge in railcar market. Customers are getting excellent value at current pricing levels. During the next few quarters we expect to see the margins in our Rail Group reflect highly competitive conditions they are experiencing along with material cost increases. We are not sure how long the decrease demand levels will continue. Fortunately, railway still a very efficient mode of transportation and pleased statistics continue to reflect replacement opportunities. In the interim, we are taking steps to shift a portion of our production capacity to wind towers. Responding to customer demand levels by shifting production capacity is…

Thank you, Tim. Good morning. TrinityRail had another solid performance during the second quarter of 2008. Operating profits and margins held steady as continued gains in productivity help to offset the impact of the competitive pricing environment and increases in raw materials cost. Operating margins for the second quarter were 12.3% compared to 16.1% a year earlier and 13.6% during the first quarter of 2008. We have been able to keep our volumes stable, which has enabled us to retain the production efficiencies we gained during the last few years. We anticipate continued benefits from lean manufacturing initiatives at our production service as well. Our highway seasoned operations group was doing an outstanding job driving further efficiencies and cost reductions. We do however expect our operating margins to decline over the balance of 2008 in that highly competitive sales environment and rising raw materials cost. The cost to build a railcar will continue to rise in 2009, driven by further significant increases in raw material cost. During the second quarter, TrinityRail shipments were 3,580 railcars, 9.5% greater than the 6,110 railcars shipped in the first quarter of 2008 and 5.7% less than the shipments in the second quarter 2007. We expect combined shipments of between 14,000 and 15,000 railcars during the third and fourth quarters of 2008. Some of these shipments will come from our finished goods inventory railcars built in advance of customers needs. We are currently reviewing our 2009 production plans. Based upon our current view of market demand, we anticipate decreasing our total production footprint going into2009. Mostly in our view, the anticipated decline in Tank Car production in 2008. Year-over-year industry Tank Car production will be significantly less than in 2008 and 2007. Ethanol production growth has slowed and many idle new Tank Cars have yet…

Thank you, Steve, and good morning everyone. My comments relate primarily to the second quarter of 2008. We filed our Form 10-Q this morning. For the second quarter of 2008, we reported earnings of $1.06 per diluted share from continuing operations. This compares with $0.85 per share from continuing operations same quarter of 2007. Revenues for the second quarter of 2008 increased 5.9% over the same quarter last year. Earnings from continuing operations exceeded the high-end of our guidance by $0.16 per share. $0.11 of this performance was associated with the gains on divestitures and profits recognized on hedging activities. The remainder can be attributed to the strong operating performance in all of the manufacturing groups. These gains were somewhat offset by a $0.02 per share charge for anticipated losses on future sales in our Rail Group. Moving to our Rail Group, revenues for this group declined on a quarter-over-quarter basis by 1.4%. Rail Group sales include its Leasing and Management Services Group were $253 million in the second quarter of 2008, with profits of $23.1 million or approximately $0.19 per share. This compares with sales to our leasing group in the first quarter of 2007 of $283 million with profits of $50.3 million or $0.41 per diluted share. These inter-company’s sales and profits are eliminated in consolidation. Our margin results for the Rail Group were 12.3%. At this time, we anticipate margins for the Rail Group of between 6% and 8% for the third quarter. As we looked forward, we expect margins of between 3% and 5% for the fourth quarter. This projected margin level represents the competitive pricing environment, the mix of car types to be built and anticipated raw material price increases. The Rail Group backlog as of June 30, 2008 consisted of 28,680 railcars with an…

Thanks, Bill. Now, the operator will prepare us for a Q&A session. Question and Answer

[Operator Instructions]. Our first question comes from John Barnes with BB&T Capital Markets. Your line is now open.

Hi, thanks. Good morning guys. Bill last quarter you provided us a little bit of a margin outlook and I apologize if I missed it. I got pulled into another call briefly, market outlook for the balance of the year in the rail sector. Can you just talk through what you are anticipating and how much of that is an issue with raw material cost versus how much of is a mix issue?

Yes, we gave two sets of guidance John for rail margins, 6% to 8% in the third quarter and 3% to 5% in the fourth quarter. I have stated that’s the combination of really three events kind of the deferred pricing environment, the mix of cars to be produced and raw materials price increases that we anticipate running to the system. I don’t think we are comfortable of saying…one is a third and one is a fourth etcetera, so when put it all of those together and that’s the guidance that rose up to the annual guidance for the company.

Okay. Do you recall the guidance you gave on margins for the second quarter?

Yes, with the second quarter I said that it would be between 6% and 9% for the rest of the year. So, 6% and 9% for the rest of the year and this breaks it down to a little more refined giving you both quarters.

Okay, fine, very good. I appreciate that. Sorry, I missed that in your prepared comments. One think, even if we look at some margin degradation in the second quarter with your whole business in your third quarter versus the second quarter. I am getting a kind of consolidated operating margin maybe 15.5% or little bit higher. I know you are up against the tough comp in the third quarter from a year ago, where we had 25% revenue growth, but even If I modeled low single-digit revenue growth with kind of still a mid-teens margin in your tax rate. I am coming up with something that’s still in excess of your third quarter guidance. And I think more importantly, as I go back and look at the first quarter and the second quarter you significantly exceeded your guidance on both measures. I am just curious, I mean what in the third and fourth quarter are you most concerned about…to issue…what on from our viewpoint is a little bit more conservative?

Yeah John, I think a couple of things to keep in mind. One is that…interest expense for the company as long as we have grown the leasing business, so when you see the top line growth leasing business and the operating profit you need to be [inaudible] the interest expense grows with that. Obviously a two point margin range in the Rail Group between 6 and 8 can give you some bad calculation in the overall number and that’s going to have a lot to do with…how we perform at the current level and how successful we are, in some of the raw material price litigation strategy. So, the guidance is what the guidance is, but I can understand how the model could give me a range of numbers.

Okay, alright. Two other small questions, one on kind of refining your production footprint on the railcar side, can you give us a little bit more color behind…how many facilities are you talking about this potentially impacting or we talking about taking a facility completely offline. As you look at it, can you give us an idea of what percentage of cars in ‘09 you are anticipating being produced in Mexico versus the US, just any more color you can on that thought process?

Steve, why don’t you answer that one?

Yes, sure. John first of all, we really are looking at our 2009 production plans, as we speak. So, as well starts to become a little more clear to, perhaps in next quarters’ call we’ll be able to shed a little bit more light on our 2009 production plan. With respect to, that the two plants that we’re converting, those are plans that are marking railcars today, we [Inaudible] fleets will particularly be making very smooth transition to producing wind towers and this capacity we don’t see demand for railcar market going forward at least couple of years and we have considerable demand for wind towers. So, I think it’s a great opportunity for us to utilize our skilled labor force, when you make planned transitions, which we again, believe it’s a competency of our company it seems do well. So, these two plans were taken down and we will continue to look at our plans for 2009 as we move forward.

Alright and then I can’t let you off the phone, unless I ask you about Texas decision the $4.5 billion being spent on the generation lines and West Texas into Dallas forth [inaudible] in his comments recently on wind tower and we heard numbers range on demand in West Texas and it is vary from 2700 towers to 7800 towers. Can you just elaborate it all as to I mean this is in your backyard, can you elaborate it all, as to what that potentially means for you wind tower business is…your current backlog reflective of any of that development already or if this new incremental demand on the marketplace.

Well, this is Tim. We sell to the wind turbine manufacturers and provide towers to them and we have all of them talking with our management, leadership and sales people in our Wind Energy business about a number of different opportunities and we don’t go back through them to try to determine which farms their towers that they are buying from it, at this stage when they are buying out there in ‘09, in the ‘10 and ‘11 time period. We are just dealing with them on contract issues as well as the quantities and the run rate. So, we don’t have an ability to reconcile wind farms to towers that we produce. We do know though that, we have a largest producer of wind towers in the country. And as you said, this right in our backyard and that’s why as Steve said and I said in my prepared remarks, we have plans of converting a couple of our facilities and we’re looking at other opportunities in our company in a number of different areas. We just have a real strong team of people that are dedicating 24/7 their energy and activities towards helping us to pursue the business opportunities there, and is very robust right now.

Okay, alright. And then I am sorry one last thing. In third quarter of ‘08, excuse me, third quarter of ‘07, you gave your initial 2008 full year guidance and outlook should we expect some more when you report third quarter numbers. Do you think you’ll have a good enough hand alone kind of the redefining of your production footprint on the rail side and that type of thing actually provide some ‘09 guidance at that point?

Yes, John, this is Bill. At this time, we are just undecided as to whether we will provide that guidance in Q3. So, as soon as we know we’ll post that number and we will provide in Q3.

Yeah, we were fortunate in last year and many of our product lines, we have long backlogs and commitments from customers and it gave us the opportunity to provide the outlook that we could in the third quarter. If we still have a lot of balls up in the air and space that we’re trying to fill then it just a best guess, at that time and we preferred when we provide long-term outlooks to have as much substance as possible to provide those figures.

Very, good. Hey, nice quarter guys. Thanks for your time.

Our next question comes from Steve Barger with KeyBanc Capital. Your line is now open.

Hi, good morning.

Good morning.

Did you mention where those plants are that you’re converting to the wind tower plants?

No.

Is that something that you would tell us?

Well, no, it’s not really public information at this stage. We’re in the planning stage and taking some steps and we don’t really talk plant by plant until we are well underway in the construction project of converting them.

Okay. Fair enough. Can you talk about the CapEx associated with doing a switchover like that per plant?

Yes. I think from a cash base perspective, we think it’s very fortunate that the flexibility in a lot of these plants, obviously when we look at converting a plant, we look for the plant that fits the product as best as possible. So, the CapEx is baked into our overall projections right now for the year which is $160 million to $170 million total CapEx.

Alright, when you talk about the timing of the current backlog, if you have the capacity to make…to monetize the entire backlog now, is that…would it theoretically be deliverable over four quarters, or is that a multi-year contractual setup?

Specifically which product are you talking?

I’m sorry, wind towers.

Yes. With regard to Wind Tower, Wind Tower has certain delivery dates, which match up with projects; you could not deliver the entire backlog at one time.

Okay. And given that you’ve taken the expectation for Wind Tower revenues up for ‘08 to 425 now, did that also mean that your, is it fair think that you would accelerate the target of the 8 to 900 million in revenues on an annual basis?

Yeah I don’t think it really related the 425 is much more reflected of some successful ramp up in one of our newer facilities and a little more production this year that we had anticipated based on our ramp up. So, the 8 million to 900 is a little more strategic view of what we see in this industry as we go forward. So, 445 is a near term efficiency they are plant to be able to produce for us.

Well, I guess just to ask in another way, I mean 8 to $900 million is a five year plan, which implies 2012 or 13. So, is given the conversion and of the two points that we were talking about and the other opportunities as you talked about is it physically possible for you to get the 8 to $900 million faster than that five year plan?

As you’ve seen in the past as Tim talking and whether was that bringing up our Barge lines or railcar lines or the wind energy, the wind tower business lines. A lot of times things happened faster than we can anticipate, but then there is other times where you have situations would occur that you don’t obtain the goals this fast. I think it’s very realistic to think that we will obtain those targets that we set out there and it’s probably safe to assume that the people continue performing like to have in the past that we should be able to beat them as well.

That’s great and then just kind of one procedural question about the wind turbine backlog. Can you talk about the typical lag between a turbine OEM announcing in order and when tower might hit the books, is there any kind of consistency there or how does is that work?

There’s really no correlation. At this time the wind tower, OEMs, booking space, so they can then commit to their customers on the quantities that they have and it’s in a very dynamic market like this, they have a lot of factors there, coming into play and so there is really not a correlation there.

Alright, thanks very much. I hop back in line.

And our next question comes from Paul Bodnar with Longbow Research. Your line is now open.

Hey, good morning, congratulation on the good quarter. Questions you had on the lease fleet I guess, the timing some of the orders there. As you guys have booked those to the past, obviously booked of periods when car prices were lower we had an increase of raw material cost, that it lease prices you can’t go back to that customer, assuming and reprice those leases, so those now become unprofitable or what happens to those straight actions I guess a little color on that?

Well, the leasing business is just like the high-rise building, where your leasing space and when you build the building sometimes you will make special deals with people to get the building filled up and then you get renewal rates. We use our leasing company for launching new products from time to time and we have been launching some new coal car in there. And we have had lease rates that encourage customers to take that coal car, we are getting very good feedback on the use of it. And that provides a lot of good strategic information to us and then there is other competitive issues Steve and his people spend a lot of time working over the strategies on all the various car types that we have. So, Steve I don’t there is simple answer to this.

I guess Paul, when we are talking about railcar prices and lease rates. The price of a new railcar set the feeling of this risk. And in today’s environment, we have high price railcars and the price of railcars continue to increase based upon raw material cost. So, that typically raises at least raise for all car types of an existing car lease rate is discounted to a new car rate, as new car rates move up, our existing car rates move up as well. So, the car that we put it in our lease fleet a couple of years ago and it must lower the capital of cost, as that car comes up for renewal or we assign we have the opportunity to increase those mix rates in a stronger lease rate environment based on the higher new car prices.

Yes, yes, I guess my question more than 17,000 cars in your backlog going to lease fleet. And I assume that many of these leases were signed over the past 6 to 12 months or so, obviously when prior to steel price is going up. Now if steel prices is going up the cost to produce that cars you definitely increased, so are you in a contract there now on 17,000 or 15,000 of cars, where that the cost of produced that car is not going to generate a good return on capital or even in a potential part.

Yes, most of those transactions have escalation provisions in our leasing agreements as well.

Okay. That was my question exactly. So, you can pass that to the lease. That was my guess.

Yes.

And then secondly was so in TRIP in the quarter, I just noticed [inaudible] delivered 92 million there. Last quarter I just think at the end of the backlog you said and you have $500 million in the backlog going there now that’s 250. Any kind of the reason for the difference there if delivered 92, I mean you should stop 400 bucks in the backlog, could you just reallocate that you’re currently leave there, what’s going on there.

Yes, this is Bill. We did make some allocation adjustment associated with TRIP in our backlog. We will do that from time to time just on certain diversification issues whether it diversification of car type customer or credit risk. So, we did make an adjustment that lowered leasing rates of the Trinity Leasing Company backlog.

Okay thanks a lot I appreciate it.

And our next question comes from Barry Haimes with Sage Asset. Your line is now open.

Hi Good morning. I had just a clarification relating to some of the leasing numbers I think it was mentioned that $253 million of the sales in the current quarter went to the lease company and then $83 million for TRIP is the $83 million embedded in the $253 million or are those two separate numbers that need to be added together to get the total lease… the total amount of cars that went to the lease entities.

You never add the two numbers together they are two separate pieces of business.

Got it, okay. And then so in doing that it looks like about 57% of revenue in round numbers went to the two leasing entities and to have it straight… on a backlog basis about looks to be 60% or 90% [ph] of the backlog is contracted by the two leasing entities. So does that sound about right?

It sounds about right but keep in mind they were we are viewing TRIP as a third party entity not a Trinity entity. We own 20% of that entity, we have pretty robust footnote within our Q that I think walks you through those pieces of business.

Got it. Okay thanks so much. I appreciate the clarification.

And our next question comes from Lewis Shapiro [ph] with Oppenheimer. Your lines are now open

Thank you very much. Would you kindly indicate how much more stock you have authorized to buy in the existing approved authorization?

Yeah, there is authorization was for 200 million, we purchase around 15 million, so there is 185 remaining under the authorization.

Is there any price limit or level?

There is no price limit or levels

Who are your principle competitors in the wind tower business?

Well…we can go ahead.

Yeah, now this is Bill, I think from our wind tower perspective again that I keep in mind that we have some other regional focus, be the central corridor of the US and inside Mexico and so within that region there are competitors. We don’t want to spend a lot of time talking about our competitors, on the conference call. But they are both public and private sectors competitors in that general geographic area.

The indication is that T. Boone Pickens has a plan to from Texas all the way upto the Canadian border. Do you expect that you will be participating in that to any extent?

Well I think as Tim mentioned earlier a lot of this position is primarily with the wind turbine manufacturer and so to the extent that wind turbine manufactures are about contracting on that particular piece of business and since they are operating model as well facilities are I’d anticipate there are wind tunnel folks who are… they are quite aggressive and I’m sure that they will be pursuing all of the opportunities and profit from this business

And if you look at the corridor that he is talking about and referring to is the central part of the United States and that’s the target market that we have identified as the corridor that we are pursuing business as well.

As I recall you set up a plant in Iowa, is that correct?

That’s correct Newton, Iowa.

Now the last question is, is there any delay in delivery of turbines from GE?

Well, we are not purchasing turbines from GE, so that’s not something that our people are monitoring its… GE is buying towers from us to set up with there turbines and so you probably would have to talk to one of their customers and somebody in the industry to get understanding of the delivery delays there.

Thank you, very much. I appreciate the response.

And at this time it appears we have further questions. Mr. Perry I will turn it back over to you.

Thank you, Kurtis. This concludes today’s conference call. Remember a replay of this call will be available starting one hour after the call ends today through midnight, Thursday, August 7th. The access number is 402-220-0121. Also, this replay will be available on our website at www.trin.net. We look forward to visiting with you again on our next conference call. Thank you for joining us this morning.

And this does conclude today’s teleconference. You may disconnect your line at any time. Have a great day