Good day. And welcome to the Trinity Industries' Second Quarter Results Conference Call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. Please note that this call may be recorded and I will be standing by should you need any assistance. Before we begin, 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 includes statements as to estimates, expectations, intentions, and predictions for 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 a description of certain business issues and risks, a change in which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. It is now my pleasure to turn the conference over to Gail Peck. Please go ahead.

Thank you, David. Good morning, everyone. Welcome to the Trinity Industries' second quarter 2017 results conference call. I am Gail Peck, Vice President of Finance and Treasurer of Trinity. Thank you for joining us this morning. Similar to the format we've used on our recent earnings calls, we will begin with an update on the Highway Products litigation matter. We will then follow with our normal quarterly earnings conference call format. Today's speakers are Theis Rice, Senior Vice President and Chief Legal Officer; Tim Wallace, our Chairman, Chief Executive Officer and President; Bill McWhirter, Senior Vice President and Group President of the Construction Products, Energy Equipment, and Inland Barge Groups; Steve Menzies, Senior Vice President and Group President of the Rail and Railcar Leasing Groups; and James Perry, our Senior Vice President and Chief Financial Officer. Following their comments, we will then move to the Q&A session. Mary Henderson, our Vice President and Chief Accounting Officer, is also in the room with us today. I will now turn the call over to Theis Rice.

Thank you, Gail. Good morning, everyone. As previously reported, the False Claims Act judgment entered against Trinity Industries and Trinity Highway Products in June 2015 is currently on appeal to the United States Circuit Court of Appeals for the Fifth Circuit. This case involves the ET Plus guardrail end terminal system manufactured by Trinity Highway Products. Following briefing in the case or argument occurred on December 7, 2016, pursuant to the Federal Rules of Appellate Procedure, the parties have filed additional materials for the court's consideration. The court has not yet issued a ruling in this case. Trinity Industries and Trinity Highway Products have also been named in a number of other suits involving Highway Products. We continue to vigorously defend our company and our products in these suits. For a more detailed review of this litigation, please see Note 18 to the financial statement in Trinity's Form 10-Q for the period ended June 30, 2017. Please also refer to etplusfacts.com for additional information. I will now turn the call over to Tim.

Thank you, Theis, and good morning, everyone. Trinity's second quarter financial results came in slightly ahead of our expectations. Generally speaking, when industry order levels reach low points, we begin to see strategic purchases occurring in our businesses. During the second quarter, this occurred in our railcar manufacturing business. I'm pleased with the order level our Rail Group received in what remains a highly competitive market. I continue to be impressed with the way our businesses are adjusting to changes in demand. They're highly flexible and quick to respond when opportunities surface. Our employees are doing a good job confronting the challenges associated with the complexities of today's business environment. Uncertainties associated with the U.S. economy and the political landscape continued to impact demand for the majority of our products. A mixture of uncertainty and optimism persists in many of the end markets our businesses serve. Our customers appear optimistic regarding potential opportunities that could surface if a major infrastructure spending program is approved by Congress. During the second quarter, our railcar leasing business generated strong earnings score from their leasing operations. In addition, they sold $100 million leased railcars through our railcar investment platform. We expect to grow our owned and managed lease fleet this year and are optimistic with respect to selling additional portfolios of leased railcars to investors that participate in our railcar investment platform. Overall, I'm pleased with our company's ability to make prompt and orderly transitions when market conditions shift. Our industrial manufacturing, construction aggregates and railcar leasing businesses strive to do their best in every market environment and constantly work at strengthening their competitive positions. Trinity remains well-positioned to capitalize on opportunities to enhance shareholder value. I will now turn it over to Bill for his remarks.

Thank you, Tim, and good morning, everyone. During the second quarter, the financial performance of the Energy Equipment Group reflected mixed demand conditions for the end markets we serve. For the quarter, revenues were in line with last year. Higher volumes in our wind towers and utility structures business were offset by weak demand in our businesses that serve the oil and gas markets. A decline in second quarter operating profit compared to last year reflects the softness in the oil and gas end-markets. At the end of the second quarter, our wind tower backlog totaled $945 million, providing stable production visibility through 2019. Included in the guidance James will provide is a planned reduction in fourth quarter deliveries as our customers reduce year-end inventory. We remain encouraged about the demand outlook for new wind farm installations during the next few years, given the production tax credit and improvements in wind turbine technology. During the second quarter, we continued to see improved visibility and increased demand levels for utility structures. The second quarter results for our Inland Barge Group reflect significant volume reductions on a year-over-year basis, as weak market conditions persist. For the quarter, the group reported revenues of $33.5 million, and a slightly better-than-breakeven operating profit. Overcapacity and declines in freight movements that transport goods along the inland waterways continued to create significant headwinds. We received orders for new barges totaling $14 million during the second quarter, bringing the backlog to $91 million. The backlog is divided between the back half of 2017 and 2018. I am pleased with the efforts our team is making to reduce cost, while meeting the needs of our customers. Our plants are positioned to respond to future changes in demand. The Construction Products Group reported solid results for the quarter. Revenues were…

Thank you, Bill. Good morning. TrinityRail's performance for the second quarter came in slightly ahead of our project expectations. The Leasing Group continued to deliver solid financial results, maintaining the high lease fleet utilization, while continuing to grow the lease fleet. During the quarter, operating profit from leasing operations increased by 15% year-over-year and the group executed $100 million of leased railcar sales to institutional investors through our railcar investment vehicle or RIV platform. Our owned, partially-owned and managed lease fleet has grown to more than 106,700 railcars, providing a solid level of earnings stability, as we continue to operate in a highly competitive railcar market. Our Rail Group delivered 4,055 railcars during the quarter, showing an 8% improvement sequentially. Our operations team has positioned us well for further production increases in the second half of 2017. We are encouraged by the improvement in railcar industry fundamentals. Year-to-date, rail traffic continued an upward trajectory, while train velocity declined. And the surplus of idle railcars, while still high, is lower than peak levels experienced last year. Second quarter industry orders for new railcars totaled more than 17,600 and represented a significant strengthening from the levels reported by the industry during the last two years, including the very weak level experienced in the first quarter of this year. While the healthy level of industry orders and order inquiry activity during the second quarter is positive, a sustained level of improvement is required before declaring a market recovery. Order inquiries thus far in the third quarter have been consistent with the second quarter. Our customers continue to express optimism concerning the direction of the economy, while being very deliberate in making capital equipment decisions. We are cautiously optimistic about trending market fundamentals. The Rail Group received orders for 5,705 railcars in the second…

Thank you, Steve, and good morning, everyone. Yesterday, we announced our results for the second quarter of 2017. For the quarter, the company reported revenues of $906 million and earnings per share of $0.33, compared to revenues of $1.2 billion and EPS of $0.62 for the second quarter of 2016. During the second quarter, we repurchased over 1.9 million shares of our common stock in the open market for $52 million, leaving $163 million remaining under our current share repurchase authorization. We also announced an 18% increase in our quarterly dividend from $0.11 per share to $0.13 per share. Since 2012, we have returned approximately $675 million to shareholders through our share repurchases and dividends. During the second quarter, we added railcars to our wholly-owned lease fleet with a value of $124 million and invested $19 million in capital expenditures across our manufacturing businesses and at the corporate level. As Bill mentioned, we recently made two complementary acquisitions in our Construction Products Group, including a small lightweight aggregates business in the second quarter and a trench shoring business early in the third quarter. During the second quarter, we sold a portfolio of $100 million of leased railcars through our railcar investment vehicle platform. As Steve indicated, we continue to expect total sales of leased railcars of between $300 million and $350 million during 2017. In May, we issued approximately $300 million of non-recourse, secured bank term notes in our leasing company. We were pleased to achieve an attractive interest rate and terms for this debt. This will support the higher level of railcar leasing CapEx in 2017 than our prior guidance, due to the increased railcar delivery guidance. Our balance sheet remains very strong. At the end of the second quarter, our cash, cash equivalents and short-term marketable securities totaled…

And we'll take our first question from Prashant Rao with Citigroup. Please go ahead. Your line is open.

Good morning, gentlemen. Thanks for taking my questions. I wanted to start just asking about the uptick in orders in the Rail Group. I mean, you talked about the majority of those being sales to the leasing business and presumably a good portion of those are sand cars. In the archived data, we also saw an uptick in tank car orders too. So I just wanted to get a sense of what you're seeing in terms of the order book build and the backlog. Is that mostly on hoppers, and is there any tank increase coming in? And if so, what's spiking that?

Yeah. Prashant, this is Steve Menzies. Thank you for the question. Again, the orders that we saw both throughout the industry as well as for Trinity were fairly broad-based, encompassing a number of different markets. Of course, when you talk about covered hoppers, as you specifically mentioned, there's many different types of covered hoppers serving a number of different markets, certainly the frac sand market as well as plastic pallets, resins, the various grain markets. So, even within covered hoppers, there's a fair amount of diversification. The other thing I would point out is that we saw a predominance of leasing orders during the quarter, certainly as evidenced by what TrinityRail took in, but also throughout the industry we saw very strong leasing presence in the order totals.

Okay. That's helpful. And maybe turning to the leasing group, you're adding to that fleet. You talked about a 1,700-car secondary market transaction. Just wondering if you can give a little bit more color about that. And then, generally, what you're seeing in the secondary market, any color in terms of evaluation or your appetite as we look to the back half of turning to the secondary market, if we're getting any signs that there's some more attractive maybe targets out there?

Yeah. Prashant, Steve again. First of all, I think we said we made a $100 million sale during the quarter and we continue, and that's through our railcar investment vehicle platform where we work very closely with some designated institutional investors who we continue to sell railcars to, and where we manage those railcars and maintain the commercial relationships. We continue to see interest in participating in our railcar investment vehicle platform by institutional investors, but also the secondary market seems to be very active as well. We acquired a small group of cars in the secondary market and we are out looking for other acquisition opportunities. But the pricing on secondary market transactions is very competitive.

Okay. That's really helpful. And then just one last question from me and then I'll turn it over. The acquisition that you made in the lightweight aggregates business, can you give us a sense of what geographies that opens you up to in terms of footprint? And maybe some thoughts on if there's more opportunity in terms of growth there, given some of the tailwinds we're seeing or in the fundamentals?

Yeah. Sure. This is Bill. So the acquisition in lightweights was in Kentucky and it opened the markets for us there. We previously had an operation in Alabama and Louisiana as well as Texas, Colorado and California. So it gives us nice broad reach across the United States and was really complementary to the business.

Hey, Bill, why don't you give them a little bit of background on the lightweight business?

Yeah. Sure. So the lightweight business is really one of two businesses within the construction aggregates business. So I'll start with the lightweight since we're there. But the lightweight business, Trinity has a national presence and it's really a competency of mining shale and clay, and running shale and clay through a rotary kiln to produce an aggregate that is in essence a substitute for natural aggregates. And its key trait is that it's lightweight in nature and therefore can be used for certain applications. And the applications can range from high-rise buildings to block to horticultural-type work, some sort of masonry as well. So, really a specialty material that is a value-add product, a little more production competency than our base business, but something that we've gotten very good at and have a really nice scale across the United States. The second piece of the aggregates business is what we would call the natural aggregates, and that's our sand and stone and gravel business, where we're simply mining those products from the earth, cleaning and segregating the products, and selling them to a base of customers. And they're very prominently used in residential, commercial and industrial markets. And we're very focused there in the southwestern part of the United States. And over really 25 years we've been in business, it's provided very nice returns for us, a diversification of earnings, and it's been a relatively low-risk building business. One of the great things about it is when you identify the reserves and then harness the intrinsic value of the reserves, you're really left managing a little bit of real estate component that we've done quite well with on the back-end.

Okay. That's very helpful color. I appreciate it, gentlemen. I'll turn it over. Thank you.

We'll take our next question from Matt Elkott with Cowen. Please go ahead. Your line is open. Matt Elkott - Cowen & Co. LLC: Good morning. Thank you for taking my question. So you guys had the highest number of orders in two years it looks like this quarter, significant increase from the first quarter. Meanwhile, over the past couple of years, you've been kind of adjusting operating resources to match a very anemic environment. So I was just wondering how much manufacturing capacity you have to reactivate and how much cost is involved to kind of accommodate, hopefully, the new environment that's much better than we've seen over the past couple of years. It looks like, from your margin guidance, there seems to be pretty good incremental leverage. Just wanted to kind of get some more color on that.

Yeah. Sure, Matt. This is Steve. Thank you for the question. Yeah. What we've learned over time is really how to optimize the flexibility of our production footprint and to be able to ramp up as demand requires. And we're starting to see a little bit of that now that we're positioning ourselves for; at the same time, when we see weaker conditions, to be able to reduce our footprint. Within our footprint, we have the ability to increase production rates on our production lines at a certain plant. A lot of that is really labor-related and our teams have done really well in being able to hire, train and retain skilled labor. So it isn't necessarily about production capacity of plants as much it is generating production line efficiencies and managing our labor very effectively. Matt Elkott - Cowen & Co. LLC: Got it. And any idea on what percentage of these orders will be built for – are for 2017 deliveries versus 2018 or beyond?

Sure. Again, the guidance that we provided is that we've increased our deliveries for 2017 to 18,000, and that's a function of not only new orders that we've taken but also pulling forward some railcars that we had previously deferred into 2018. Matt Elkott - Cowen & Co. LLC: Got it. And the backlog ASP decline, even though you've grown it for the first time in two years as well, the value remained the same, indicating a lower ASP. I would imagine most of that ASP decline is attributable to new orders versus the profile of deliveries?

Well, you have a little combination of both. You have both the new orders as well as the mix of railcars that we pulled forward. So, that does have an impact on our ASP. Matt Elkott - Cowen & Co. LLC: Got it. And just one final quick question. You mentioned that the inquiry activity in the third quarter has been consistent with 2Q, which is very encouraging. I was just wondering how many orders – I don't know if you're able to quantify it, but if you've gotten any orders in the third quarter so far?

Well, we have received orders in the quarter, but we don't comment about our third quarters until the quarter is completed. Matt Elkott - Cowen & Co. LLC: Great. Thank you very much.

We'll take our next question from Brian Colley with Stephens. Please go ahead. Your line is open.

Hey. Good morning, guys, and congratulations on the quarter.

Thank you.

So, would you guys be willing to disclose the revenue from the two bolt-on acquisitions you made in the quarter? Just curious what that is. And then, looking ahead, wondering if we should expect maybe some larger acquisitions in the future. What are you guys seeing out in the M&A market?

This is James. I'll start, Brian. Thanks for your question today. We don't at this time have an estimate that we're putting out there for the revenues. The lightweight acquisition business was very strategic for us, a rather small acquisition, but very nice. The shoring acquisition, as Bill said, it was rather similar in size to the one we did a few years ago. So, that's going to be a nice addition to the Construction Products Group portfolio. That business has continued to perform well and gave us good returns. But from a pipeline perspective, these acquisitions have just recently happened and so we're still assessing how that flows through, especially this year. But then we'll be able to provide more insight as we get into 2018 later this year or early next year.

Okay. That's helpful. And then just thinking about the lease rate environment, it seems like they've been pretty stable sequentially year-to-date outside of the pickup we've seen in frac sand. Have trends been pretty similar in terms of new railcar prices for the industry? Just curious to see if we've seen any stabilization on that front as well.

Yeah. Brian, it's Steve. Well, first of all, when you're talking about a new railcar and you're leasing a new railcar, you project what you think that railcar will earn not only over its original lease term, but over a pretty good bit of its life. And the assumption is that it meets our hurdle rate that you have for investment. So we do think that the new railcars that are being produced and that we're putting on a lease fleet do have attractive long-term returns in our business. Lease rates on new railcars have moved with new railcar prices, which are obviously down over the last 18 months or so. But it seems to move in parallel and then you have the returns that you get with the investment, so.

Okay. That's helpful. I appreciate the time today.

Thank you, Brian.

And we'll take our next question from Bascome Majors with Susquehanna. Please go ahead. Your line is open.

Yeah. Thanks for taking my question here. So, over the last let's call it a year-and-a-half, two years, you guys have been very forward about the challenges that you're seeing in your end markets. And it felt like the tone changed a bit more constructively this quarter, especially in light of your typical conservatism there. I mean, you're talking about seeing some kind of early-cycle activity in some of your markets, particularly rail, you started buying stock for the first time in over a year, raised the dividend, did some tuck-in acquisitions. And so I'm just trying to kind of unpack that, not really at the segment level but maybe at the customer and the broader high-level end-markets. Where are you seeing signs of life in your industrial end-markets? And what would you call more steady or maybe even weakening in over the next, let's call it, 6 to 12 months?

Steve, why don't you take that first part and, Bill, you can add color on the back side?

Yeah. Bascome, thanks. I think there's general optimism with our customers in conversations that we have, but a lot of that optimism is based upon some expected changes in tax law and regulatory reform that we're only seeing the beginnings of or prospectively the beginnings of. So, while there is optimism, before customers really start to make commitments through acquiring or leasing capital equipment, I think they're looking for some more evidence that the trends are going to continue for a stronger and improved environment. I will tell you that some of the equipment that has been ordered in the rail sector are for projects that are already under investments and are part of those facilities or operations being build out. This is particularly true in the downstream petrochemical sector and in the specialty chemical sector, where we see tank cars and large covered hopper cars are produced. And I think, as Tim mentioned we also see customers see this time as opportunistic if they have large strategic purchases to make. And some of the orders that we did see during the quarter were for replacement of older equipment, for upgrading of equipment to be more competitive in the marketplace. So I think customers are looking at their capital opportunities. They are investing. It's slow in coming, never as quick as we would like, but I think generally the arrow points a little bit upwards as opposed to another direction. Bill, you want to add on to that?

Yeah. I would say, from our perspective, the CPG area or construction business and energy business really reflect the broad base of infrastructure spend. And when we look at infrastructure spend drivers throughout the United States and North America, they point fairly strong at both the state level and the federal level. And so, while there is good funding and there is good growth there, there is a lot of conversation about more funding and more growth at a much higher level. And so we have several businesses, certainly the aggregates business, the highway business, the utility business, that are all benefiting from a spend in America's infrastructure.

I appreciate the comprehensive answer, guys. And maybe if I could kind of take it even higher level to Tim here. And does it feel like 2017, as you kind of unpack that, is the bottom for your multi-industry portfolio here? Is it still early or too early to make that call?

I think it's too early to make that call. As I've said, there's unique mixture that we've seen ever since the election occurring with our end markets of our customers being optimistic, but also a little bit uncertain. And so, in this environment, our flexibility plays a really key role and our ability to be able to ramp up quickly and step out in front of our customers and say we can take the big orders if you have the demand and the need. And so, that's what inspires me and it really thrills me as well to see what happened in our rail business, because we did have some big customers that pursued us and we were able to respond. And so, if that continues, then you end up getting some really positive momentum that we would then declare that we have left the bottom and we're moving up in a more upward direction.

Thank you, Tim. I appreciate that. Just one last one for me on the rail business. We've seen the stored railcars numbers, at least how the AAR defines them, sequentially rise fairly modestly but pretty much in the rail, and that's the first time that's happened really in over a year. I'm just curious, do you guys have any insight into what's driving that either from a customer level or kind of what you heard in your business? And with that, I'll give it back to the next guy.

Sure, Bascome. Steve again. I guess the devil's in those details. When you look at the overall number of idle railcars, when you start to delve a little further into the different types of railcars, each one of them tells a little bit different story about the various markets. But, again, I think right now what we've seen in the idle fleet is encouraging when we look at the other trends in the railcar market fundamentals.

And we'll take our next question from Gordon Johnson with Axiom. Please go ahead. Your line is open.

Hey, guys. Thanks for taking the question.

Good morning.

Just as a point of clarification, did you guys say the new orders this quarter were 90% to the lease group?

Approximately, yes.

Okay. So, I guess, one question we had is, okay, assuming – looking at your backlog, your backlog in terms of dollars looks to be flat, but clearly units were up. So, just working out the math, it seems like maybe the ASP was down on that backlog or those new orders. So is the way to think about this, the new orders that the lease group purchased, given the ASP is down significantly, the lease rates on those cars will be worse than I guess what we've seen previously?

Gordon, this is James. I'll answer that at a high level. That's probably reading a little too deep into. We're not implying that. The biggest reason you see changes when you have the big order quarters like we just did, part of it is you're working off the deliveries you made at certain levels of pricing and mix, and then you're taking orders for cars at a different level of pricing. A lot of that is related to the mix of the car. So, as the car types themselves change, certainly from tank to freight and different car types, the mix alone can do that. Q1 kind of reflected that type of piece as well. So, when you see Q2, the backlog number ending up in the same place rounding up to that $2.7 billion or so is a factor of pricing mix, volume deliveries and the new orders. I wouldn't imply that all the way down to the lease rate level.

Okay. And then just applying some math here. Assuming a $115,000 ASP what went in, (45:01) does that imply that new orders are at a roughly $89,000 ASP?

I think your math is probably in the ballpark. You'll see a little more of that in the 10-Q. But your math is roughly right. But, again, that's mix as much as anything in the car types that we delivered versus the car types we took in.

Okay. And then, just lastly, looking at I guess the 90% of new orders to the lease group. The last time we saw that type of percentage to the lease group was in 2010. And I guess, 2009 to 2010, your operating cash flow fell from $686 million to $170 million. So your operating cash flow was $1 billion last year. Should we expect a decline in your operating cash flow as you sell more cars to your lease group?

Yeah. Gordon, this is James. Not necessarily. There's a lot of moving parts. When you look at 2009 and 2010 versus where we are now, a lot of the operating cash flow, the first part of course is net income, and you have that guidance, changes to working capital which could ramp up as our delivery expectations ramp up as well. The operating cash flow line won't be affected by that necessarily. As you get down into the investing and financing lines, the CapEx to leasing will show up in the way we invest our capital, and then whether we finance those cars or not. We did a financing in Q2 to kind of pre-fund some of those. But how much we do financing will determine the ultimate cash flow, depends on which line you stop at in the cash flow statement.

Okay. Thanks a lot, guys. And congrats on the good orders.

Thank you, Gordon.

Thanks.

We'll take our next question from Allison Poliniak with Wells Fargo. Your line is open. Please go ahead.

Hi, guys. Good morning. Steve, can I just confirm, did you say Construction Products revenue is going to be $500 million versus the $520 million that you guys laid before?

$510 million versus the $520 million, Allison.

Okay. So can you just explain, it sounds like you guys are pretty positive on the aggregates and the infrastructure side of the business. What changed there that's driving that revenue to come down a little bit?

Bill?

Yeah. Allison, this is Bill. Part of the decline has been in the Highway Products side of the business. And as we look at the Highway Products side of the business, we have stepped back and kind of strategically reduced the portfolio offering a little bit. And so a bit of that is intentional. We're focused obviously on bottom-line operating profit, the dollars and the margin, and we may sacrifice a little bit of revenue to get there.

That's great. And then on the trench shoring business, not specifics, but maybe help us try to frame it in our mind in terms of growth rate of that area right now and just maybe margins relative to your current segment margins. Are they better? Will we get a better mix with this kind of business going forward?

Yeah. I would say the margins are relatively consistent with the margins of the segment overall. It's got really good market dynamics going forward. It's highly related to infrastructure that we talked about earlier. And so, as these projects go off to fix a lot of the waterlines that need to fixed and put the pipelines in that need to be there, it does well. It is also a seasonal business. So it will have a little seasonal tail in the winter months, very similar to the construction business.

Got it. And then, just the wind stepping down in Q4, is that just the nature of the project-related business or is there something more to read into that?

No. It's just the nature of the business. We've had this for several quarters. You'll see the first quarter kind of pop-up as they take the inventory back, but essentially they've all got a mandate to reduce their inventory right at the year-end. And so, rather than completely shutting down production and then coming back and being behind, we try to run a fairly steady projection and we just don't take that revenue until it's delivered in the first quarter.

Perfect. And then, just one last one. On the operating revenue increase for the leasing business, is that just the incremental adds to the new leased cars in the back half of the year, new deliveries?

More than anything else, Allison.

Perfect. Thank you.

Thank you.

And we'll take our next question from Matt Brooklier with Buckingham Research. Please go ahead. Your line is open.

Hey. Thanks and good morning. Steve, did you talk to the raised delivery guidance for 2017? How much of that is a pull-forward of some of the cars that were deferred into 2018 and 2019 versus how much of that is a result of the increased orders that you took in 2Q?

Matt, the increase in our production projections from our last guidance are split about evenly between cars that were pulled forward from 2018 as well as incremental orders.

Okay. And on the pull-forward on the cars that were deferred, we should assume majority of those are the small cube hoppers for the sand market?

Yes.

Okay.

There's also a few other orders, but predominantly those would be correct.

Okay. That's helpful. And then, how should we think about the cadence of deliveries as we work through the year relative to the total number of cars, a little over 4,000, that you shipped in second quarter? Is it kind of a ratable increase throughout the remaining two quarters of 2017? Is there a bigger ramp in the back half of the year? A little color there would be helpful.

Yeah. It will ramp up throughout the second half of the year. Our third quarter will have a higher production level than the second quarter and the fourth quarter will likely be higher yet.

Okay. And then your commentary regarding, I think, just the industry book in general and the increase in terms of the orders, it sounded like there was a greater percentage of lessors who were placing orders in 2Q. Is that just a function of the cycle and early in the recovery stages typically you see lessors step up and try to position themselves into potentially improving marketplace or improving railcar fundamentals, or is there something else going on that, I guess, potentially changed the mix of who's buying cars in 2Q?

Yes. Well, thanks. There were certainly some orders placed by lessors during the quarter, but there were also a number of orders that were placed by industrial shippers who are looking to lease the equipment and not acquire the equipment. And when I refer to those as the leasing orders, that's really what I'm referring to. And a number of those orders at least from our perspective were very good counterparties in long-term leases and we found those opportunities to be very attractive. Cleary, the trend over time, Matt, has been that we're seeing more and more leasing activity. The growth of leasing not only by industrial shippers but also by Class I railroads continues to grow. And that's certainly one of the long-term fundamental reasons why we continue to invest in our leasing capabilities to strengthen our business platform.

Okay. That's very helpful. And then, just my last question, the tank car, I think you indicated you did take some tank car orders in the quarter. Are you able to elaborate on the types of cars? Are those flammable service tanks and potentially related to the regulation mandate deadlines that we have for replacement? Were they non-flammable cars? I'm just trying to get a sense for maybe the uptick in terms of industry tank orders, what's driving that.

Without getting into deep detail on the orders themselves, I think as I've said, we see demand continue to have some pace to it associated with the downstream chemical and petrochemical sector, specialty chemicals. And I would generally categorize our tank car orders from those industry sectors. Matt Elkott - Cowen & Co. LLC: Okay. Very helpful. As always, appreciate the time.

Thank you, Matt.

Thank you. And at this time, I'd like to return the call to Ms. Gail Peck.

Thank you, David. That concludes today's conference call. A replay of today's call will be available after 1 o'clock Eastern Standard Time through midnight on August 2. The access number is 402-220-2972. Also, the replay will be available on the website located at www.trin.net. We look forward to visiting with you again on our next conference call. Thank you for joining us this morning.

This does conclude today's program. Thank you for your participation and you may disconnect at any time.