Good day, everyone, and welcome to today's Trinity Industries' Fourth Quarter and Full Year 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, this call may be recorded. I'll be standing by if you should need any assistance. 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 includes 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 a 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. It is now my pleasure to turn the conference over to Gail Peck.

Thank you, Leo. Good morning, everyone. Welcome to the Trinity Industries' fourth quarter 2017 results conference call. I'm Gail Peck, Vice President of Finance and Treasurer of Trinity. Thank you for joining us this morning. As we've done previously, we will begin today's earnings call with a brief update on the Highway Products litigation matter provided by Theis Rice, our Senior Vice President and Chief Legal Officer. We will then follow with our normal quarterly earnings call format. New to this format is a dedicated section to the planned spin-off of the company's infrastructure-related business. Melendy Lovett, Trinity's Senior Vice President and Chief Administrative Officer, will provide the spin-off update. We also would like to introduce Eric Marchetto, Executive Vice President and Chief Commercial Officer for TrinityRail, who will cover Rail and Leasing this morning. Some of you may know Eric. For those that do not, Eric has been with Trinity over 20 years, and his tenure has been spent entirely in our Rail and Leasing businesses, with broad responsibilities spanning accounting, finance and portfolio management, to market analysis, investments and contract administration. Previously, Eric was Chief Financial Officer of TrinityRail. Today's speakers also include 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 Group; and James Perry, our Senior Vice President and Chief Financial Officer. Following prepared remarks, we will move to the Q&A session. Mary Henderson, our Vice President and Chief Accounting Officer; and Scott Beasley, the future Chief Financial Officer of the new infrastructure company are also in the room with us today. I will now turn the call over to Theis Rice.

Thank you, Gail. Good morning, everyone. In our last call, I reported on the status of the Joshua Harman False Claims Act litigation pertaining to the company's ET Plus guardrail end-terminal system. As reported, the United States Court of Appeals for the Fifth Circuit published a unanimous ruling on September 29, 2017 that reversed the Trial Court's judgment in the case and rendered judgment for Trinity as a matter of law. On October 27, 2017, Mr. Harman filed a petition for rehearing en banc in the Fifth Circuit, which is a request for all active judges on the Fifth Circuit to review the Fifth Circuit panel's appellate decision. The Fifth Circuit denied Mr. Harman's petition for rehearing on November 14, 2017. On February 12, 2018, Mr. Harman filed a petition for certiorari with the United States Supreme Court to review the Fifth Circuit's decision rendering judgment for Trinity. Essentially, this is Harman's appeal of the Fifth Circuit's ruling to the Supreme Court. The Supreme Court is under no obligation to accept Mr. Harman's request as it is wholly within the court's discretion whether or not to hear the case. Historically, the Supreme Court grants approximately 1% of the hearing requests it receives. If Mr. Harman's request is accepted by the court, the case will proceed to briefing by both parties in a hearing before the Supreme Court where the parties orally argue their respective positions. If the Supreme Court refuses to hear the case, the Fifth Circuit's ruling in Trinity's favor is final and no further appeal is available, thereby ending the litigation. We do not know when the court will rule on Mr. Harman's request, as the timing of the decision by the Supreme Court on whether or not to accept the case is within their discretion. The court…

Thank you, Theis, and good morning, everyone. Last year was an eventful year for our company in many ways. Our consolidated financial results outperformed our original expectations heading into the year. Despite ongoing oversupply conditions in the railcar and inland barge markets, our teams were able to maintain operational flexibility and adjust to the demand fluctuations. Additionally, TrinityRail's commercial teams were successful in maintaining high-lease fleet utilization throughout the year. We successfully expanded our Railcar Investment Vehicle platform completing $460 million in leased railcar sales in response to strong demand for these assets. We also invested $63 million in our Construction Products businesses. We expanded our trench shoring manufacturing platform and we acquired the assets of two lightweight aggregate businesses. Also during 2017, we continued to make internal capital improvements to improve our operating infrastructure, and invested $85 million to buy back stock. During the past few years, Trinity's management and Board of Directors with the assistance of external advisors devoted time to evaluating a variety of strategic options with the potential to enhance shareholder value and position our company for long-term growth. Our valuation process took into consideration the results of several third-party investor surveys, as well as ongoing dialogues with the investment community. The input we received from our stakeholders was very useful, as we analyzed and discussed various strategic alternatives for increasing shareholder value. During December, we announced our intent to pursue a tax-free spin-off of our infrastructure-related businesses to Trinity's shareholders. The transaction is expected to result in two separate public companies. This year will be transformational year for Trinity, as we implement our plan. I'm very excited about the potential value that I believe will be created as a result of the spin-off. Recently, we announced the senior leaders for our businesses after the spin-off.…

Thank you, Tim, and good morning, everyone. Since our December announcement, Trinity has established a cross-functional team of company leaders to assist with the spin-off transaction and the separation of the businesses. The primary goals of the project are a successful and seamless spin-off and at the same time a business-as-usual focus on Trinity's day-to-day operations and business results. We believe one of Trinity's core strength is our employees, who embody our culture of flexibility and collaboration. This is a valuable asset as we move toward this transformative separation. We have formed teams for each major work stream and we meet routinely to address transaction execution and business separation requirements. The teams are proceeding through our detailed work plan and continue to make good progress towards this important transaction. We are very pleased with how our teams are working together alongside our expert advisors to create what we anticipate will be two strong and valuable public companies. We've established a number of key milestones for a successful spin-off. Thus far, we've made considerable progress on the refinement of new corporate and organizational structures. We've announced CEO and CFO leadership for the two companies, and are in the process of getting senior management teams in place. Decisions pertaining to the portfolio makeup of the infrastructure business, as well as company name and other key decisions will follow. We look forward to providing this and other information to our stakeholders in due course. Additionally, earlier this month, we filed a private letter ruling request with the IRS. We expect to file our initial Form 10 with the SEC in the second quarter. This is the primary public filing describing the infrastructure business that is being spun off. At this time, we are expecting to complete the spin-off in the fourth quarter of 2018. We will continue to update our stakeholders on our quarterly earnings calls and at other times as appropriate as we progress through this process. I will now turn the conference call over to Bill.

Thank you, Melendy, and good morning, everyone. The fourth quarter financial performance of our Energy Equipment Group reflected mixed demand conditions for the end markets we serve. For the quarter, revenues and operating profit declined compared to last year due to planned lower volume in our wind tower business and continued softness in the group's other products lines, primarily those serving the oil and gas markets. The group results for the quarter were positively impacted by improved year-over-year performance in our utility structures business, driven by increased volume, pricing and improved efficiencies. At the end of the fourth quarter, our wind tower backlog totaled $781 million. During our last call, we indicated that we expected revenues during the fourth quarter to decline due to a customer deferring deliveries on finished towers until the first quarter of 2018. The fourth quarter results were – the customer ultimately elected to move a portion of those deliveries back to the fourth quarter of 2017, a positive result and the primary driver for the group's outperformance versus guidance during the quarter. The wind tower revenue we achieved in the fourth quarter is comparable to what we expect from revenues on a quarterly basis during 2018. As we have indicated on many of our previous calls, the scheduled phase-out of the tax credit continues to put pressure on wind tower margins. Turning to our utility structures business, we remain optimistic about improving market fundamentals and expect better results in 2018. While market bidding activity has increased, projects continue to be on the small side. Long-term fundamentals remain intact based on the need to replace aging infrastructure and improve the reliability of the grid. The fourth quarter results for our Inland Barge Group reflect significant year-over-year volume reductions as weak market conditions continue. During the quarter,…

Thank you, Bill. Good morning. It's a pleasure to join this morning's call to discuss the performance highlights and market commentary for the Rail and Leasing businesses. TrinityRail's overall performance continued to reflect the scale and strength of the integrated business model for railcar leasing, manufacturing and services and its culture of operational and financial flexibility. The financial performance of the Rail and Leasing Groups was in line with our expectations during the fourth quarter, resulting in full year 2017 performance that exceeded our initial expectations heading into the year. Our team responded to competitive market conditions and increasing production volumes while controlling costs and servicing our customers' railcar needs. We are closely monitoring market conditions and are well positioned to respond to improvements in market demand. During 2017, the Leasing and Management Services revenue and profit for operations increased slightly year-over-year after adjusting for a cancellation fee received in the fourth quarter. The increases were primarily due to growth in the wholly owned lease fleet and asset management fees, partially offset by lower overall lease rates. Our team did a good job maintaining high-lease fleet utilization, while growing our owned and managed fleet year-over-year. Lease fleet utilization of 96.8% and an average remaining lease term of 3.4 years at the end of the fourth quarter remain at healthy levels, reflecting the significant effort of our team. Lease fleet utilization fluctuates from quarter to quarter. Expirations within the lease fleet for 2018 are in a manageable range, and the percentage of leased railcars coming up for renewal is consistent with prior years. Lease renewal terms and rates have improved from recent levels. However, in certain markets, current lease rates remain below those of expiring leases, placing pressure on our 2018 revenue expectations. Our total owned and managed lease fleet now…

Thank you, Eric, and good morning, everyone. Yesterday, we announced our results for the fourth quarter of 2017. For the quarter, the company reported revenues of $906 million and earnings per share of $3.42, including a one-time benefit of $3.03 per share related to the effects of the Tax Cuts and Jobs Act and transaction expenses of $0.04 per share related to the company's planned spin-off transaction. This resulted in adjusted EPS of $0.43 related to core earnings for the fourth quarter compared to EPS of $0.44 in 2016. For the full year 2017, we reported revenues of $3.7 billion and earnings per share of $4.52, including a one-time tax benefit of $3.06 per share and spin-related transaction expenses of $0.06 per share. This resulted in adjusted EPS related to core earnings of $1.52 for the full year 2017 compared to EPS of $2.25 in 2016. With respect to the effect of the Tax Cuts and Jobs Act, we recorded a one-time non-cash benefit of $476 million in the fourth quarter. This benefit resulted from the re-measurement of the company's net deferred tax liabilities primarily associated with our leased railcar fleet and convertible debt to reflect the new federal corporate income tax rate. We have completed an initial assessment of the tax effects of the Act, and have made a reasonable estimate at this time. However, we are still analyzing certain aspects of the Act and refining our calculations. I'd like to take a few moments to discuss the potential implications of tax reform beyond the one-time accounting ramifications. As a result of the Act, we now expect an effective tax rate of approximately 24% in 2018, down from our previous expectation of a 36% tax rate. We are not realizing the full benefit of the 21% corporate tax rate…

We'll take a question from Allison Poliniak of Wells Fargo.

Hi, guys. Good morning.

Morning.

James, you had mentioned incremental investment in the lease fleet that weren't in your prior guidance. I can't remember if you gave us that number last quarter. Is there any way to quantify what that incremental step-up was in the guidance?

Allison, yeah, this is James. We did not give that deferred profit or investment number before, but it helps to explain some of the moving parts within our changing guidance from the $0.90 to $1.25 to the current $1.15 to $1.35. Quantifying it, we wouldn't get that specific. It wasn't terribly material, but it did explain some of the movement in the guidance.

Got it. And then on the rail margins at 8%, I know you cited mix and pricing. Is there anything operationally in terms of line changes or is there such that – that's laying on that margin in 2018?

Not necessarily out of the ordinary. We always incorporate those types of things. We've got a pretty good sense of our production planning. As Eric mentioned, 73% of our 2018 deliveries are in the backlog right now. So, we have our lines laid out pretty well. But we'll certainly work hard to find efficiencies where we can in the production plans.

Great. Thank you.

Thank you.

We'll move next to Prashant Rao of Citigroup.

Good morning. Thanks for taking the question. I guess bigger picture on the guidance, feels like the top-end since you have drawn in a little bit even if I work through the tax impact and some of the other items that you called out, James, just wondering sort of where – I understand conservatism given the market, but just sort of wanted to get a bigger picture sense of maybe where that top-end pulling might have come from? Where it's emanating from, and sort of just to be able to gauge how you guys are thinking about that as you're looking forward into 2018?

Yeah, Prashant, this is James. Thanks. As we look at our guidance each time and it's been four months since we put the last guidance out, we always try to narrow down what we provide for you in guidance and tighten it. We had a pretty big range last time, as we had a lot of moving parts obviously out there. If you look at the tax rate change, that alone kind of puts you at the same midpoint where we were before where we are now. So, you end up with about the same midpoint if you just tax-effect that from the 36% to the 24%. We've got more visibility. So, we've increased the car sale guidance at the top end to where our range was before. But really we sit down with our business leaders very frequently, as we've talked about with you and others on the call several times, and so we brought the bottom end up, brought the top end down a little bit, really tightened it. Not a real specific reason, we're certainly optimistic in our ability to work through our range of guidance, but it's simply a sense of looking at the midpoint of where we are and trying to give as tight as a range as we're comfortable with at this time.

Okay. That makes sense. Thanks. And then second question is just on the railcar – secondary railcar market, the acquisition opportunities. We've had I think just this week a comp – (38:48) a small fleet of about 1,000 cars that seems like won an attractive rates some DOT-117s and some CPC-1232s (38:49) in there. And with the acceleration sort of – or the continuing demand for retrofit activity and maintenance work, is the secondary market looking even more attractive as we turn from 2017 to 2018 here? Are there opportunities out there to really juice up your return on investment given that there might be some sellers that are willing to move at sort of lower prices than what we were seeing in terms of comps for the past, I guess, 12, 18 months?

Eric, why don't you take that one?

Sure. Yes, Prashant. We are seeing some activity in the secondary market where you did have – especially bank owners that own some railcars, specifically tank cars and they are looking to unload those cars. And we are seeing more activity in the secondary market around that. I think it will present some buying opportunities for people.

This is James, Prashant. I think what gives us a good opportunity as well as with the Railcar Investment Vehicle platform that we've built, we have investors that want to continue to add to those fleets as we're able to identify through Eric's team's leadership those opportunities that make a lot of sense for our fleet and the fleets of our RIV partners.

Okay. Thanks very much for the time. Appreciate it.

Our next question comes from Matt Elkott of Cowen. Matt Elkott - Cowen & Co. LLC: Good morning. Thank you for taking my question. My question is about the capital deployment strategy for the new TrinityRail post the spin-off. I know you guys – traditionally you consolidated the railcar market prior to becoming this diversified industrials company. But then, you are done with that, maybe with the exception of leasing. Now that we're going to go back to a more pure-play railcar manufacturing and leasing company, does that open up new possibilities to further consolidate the railcar market from a manufacturing or a leasing perspective?

Yeah. Sure, Matt. This is James, and I want to echo what Tim said about our excitement that Tim and I are going to be with the Trinity post spin and really giving us clarity of focus now in terms of the capital we have available and really being able to focus internally, and then with the investment community what our strategies are, and we'll do that as we move forward through the spin-off process. We are going to have good capital. We've always talked about the balance sheet capacity we have on the rail side of the business, especially in the lease fleet, the opportunities that it provides us. I think we're really – as we share that strategy with you, you're going to hear a wide range of opportunities we have. We won't get specific yet on where the focus may be, but we've clearly talked about wanting to continue to grow our lease fleet, continue to work with our RIV partners in growing our management of lease fleets. Eric's talked about expanding our maintenance services opportunities that we need to do, not only to serve those cars that we manage for ourselves and others, but also fleets that our customers may own. So, I think there's a broad range of opportunities for us with the integrated rail model that we're going to be able to invest, and we're excited about being able to do that. Matt Elkott - Cowen & Co. LLC: Great. Thanks for that, James. And also, one more question about the – you mentioned some of the revenue headwinds that may be facing the Leasing segment, which is inherent in the cyclicality of the industry. But anyway you can – and if you have given it, sorry if I missed it, but anyway you can give us a sense of the percentage of cars coming up for renewal in 2018?

This is James. As Eric said, it's not out of line of what we've had in prior years. If you look at our average remaining lease term of about three to three-and-a-half years, that tells you on average about 15% to 20% of the cars come up for lease, and this is not an abnormal year. So, it's really just going through those cars we have, some of which have been on long-term leases, some on short-term leases. So, it's really lease by lease as we look at the adjustments and what the forecast currently tells us where our commercial team sees with lease rates and hurdle (42:48) opportunities. Matt Elkott - Cowen & Co. LLC: Of the 15% to 20% that are coming off lease, which is consistent with previous years, is there a higher percentage of energy-related equipment from the crude-by-rail era this year?

Eric?

This is Eric. No. There's not. Most of those leases were longer-term leases. So, we're not experiencing that. It's a pretty normal distribution on terms of expirations. Matt Elkott - Cowen & Co. LLC: Got it. Great.

And, Matt... Matt Elkott - Cowen & Co. LLC: Thank you very much. Appreciate it. Yeah.

Sure. Okay, thank you. Matt Elkott - Cowen & Co. LLC: Thank you.

Our next question is from Justin Long of Stephens.

Thanks and good morning.

Morning.

I wanted to ask another one on the Rail Group margin guidance of 8% for the full year. Is there any commentary you could share on the expected quarterly cadence of margins for that segment? And on the orders you're taking today, has the pricing and, I guess, the margins stabilized? I'm just curious if that 8% margin outlook is a good representation of where the market is today.

Why don't I handle the first part – this is James – Justin, in terms of cadence. As Eric mentioned, we see a step-down in volume from the fourth quarter to the first quarter. But if you look at our first and second half, we see roughly pretty consistent volumes in the first half of the year and the back half of the year. Margins generally are flat throughout the year. You may see some ups and downs based on particular orders and when cars get delivered, but we wouldn't speak to a cadence anything out of the ordinary with the overall 8% guidance. Eric, maybe you can address the commercial side of things and how the market is looking.

Sure. In terms of pricing on new railcars, certainly with the overhang of existing railcars that while that's come down modestly year-over-year, there's still a significant number of idle railcars in the market. And there's still excess manufacturing capacity on the new car side. So, those certainly provide some headwinds to improving sales prices. It does seem like prices have stabilized, overall, as we've mentioned. And so, we don't expect them to go any lower. And with economic activity picking up, hopefully we can see some improvements there.

Okay, great. That's all helpful. And secondly, I know the details on the spin process are still being worked out. But is there any initial commentary you could provide on how overhead costs could evolve? I'm guessing that due to having two separate companies, there will be a step-up associated with that, but I'm curious what you are assuming that ramp could look like when you assess this strategic decision.

Yeah, Justin, this is James. Thanks. It's certainly early to get too deep in the long term. I think the way you're thinking about it is right. In the early phases, you're going to see some overlap and some duplication, but both companies are going to be very focused on as we put together the management teams, as we put together the cost structures, the administrative type functions we need, looking hard at costs both at the corporate level, of course, and through the businesses. Tim and I having the focus, and Antonio and Scott having the same focus, we'll be spending a lot of time with the management teams looking at the needs we have, and looking at how we can reduce costs over time. But I think you may see, to your point, a bit of a step-up day one, but in the longer term, a keen focus on that.

Okay. Thanks. Appreciate the time today.

Thank you.

Thank you.

We'll move next to Matt Brooklier of Buckingham Research.

Yeah. Thanks, and good morning. Can you just talk to the composition of orders, the types of railcars that you saw in fourth quarter, and then, maybe also provide a little bit of color in terms of how demand and inquiries are trending thus far in first quarter?

Eric, you want to take that?

Sure, Matt. This is Eric. As we mentioned, we are seeing a diverse mix of order activity. The fourth quarter orders represented several markets, both replacement needs such as agricultural and automotive and then some growth markets, specifically plastics and some refined chemicals and refined products.

Okay. And then the pace of demand and inquiries thus far in the first quarter, has there been any change there when compared to fourth quarter?

This is Eric again, Matt. As I mentioned, we're pleased with the level so far. It's early in the first quarter yet, but we are pleased with the inquiry level and the early order activity. And so we remain encouraged.

Good to hear. And then, James, I think you talked to the corporate expense being down this year relative to 2017. But I think you also talked to your expectations or – you guys are baking in legal, like no change in terms of the legal expense. So, I guess if I heard you correctly, what's driving the decrease in terms of the corporate expense in 2018?

Yeah. You're seeing a modest decrease in the corporate expenses. And we're certainly working hard to reduce costs where we can. We had – as you'll read more in the 10-K, given the performance that we ended up with and the incentive programs that we have in place, there was a higher level of performance-based incentives, certainly back half of the year as the earnings accelerated to some degree. And as we forecast things, we generally assume a target level type performance. And we'll detail that as the year goes through. To your point, we do expect that legal costs remain relatively flat. But we're encouraged that we're seeing some opportunities to reduce corporate expenses as the folks are really doing a good job of looking within their groups, their departments, the functions we have, and where we can cut some costs.

Good to hear. Appreciate the time.

Thank you.

And we'll move next to Brady Cox of Stifel. Your line is open. Brady Michael Cox - Stifel, Nicolaus & Co., Inc.: Yeah. Thanks. I want to ask first on the rail margin. I know you talked about it a little bit and sort of a similar question to the question on pricing earlier, maybe asked a different way. If volume doesn't increase significantly beyond 2018 with the inquiry levels you have now or the pricing you're seeing now, is there a way for margins to grow again to more sustainable levels in that business without significant benefit from operating leverage, or do you think it's going to be sort of in the high-single digit range going forward?

This is James. It's clearly, as you know, early to forecast beyond 2018 at this point in terms of specific margins. We know we have some cars in the backlog. But at this type of volume, which is generally kind of a mid-cycle type of volume level, we've had various margin points throughout our various cycles. What I would say is, yeah, clearly pricing is important and it depends on which cars get ordered and where the supply-demand is for those specific car types. So pricing in and of itself certainly has a broad band that can affect margins. The leadership in the Rail Group is certainly looking for operation efficiencies where they can. And then you have when you come down to – and this is something Allison mentioned earlier, how long your production runs are, your changeovers, those type things, and how we really operate our facilities. The more visibility we have, the longer runs we have, the better we're able to plan, the better opportunity we have to improve our margins. So, I wouldn't forecast where the level is going to be yet or what the opportunities are, but we're certainly with the leadership team seeking out those opportunities to improve our margins in future years despite where volume may be. Brady Michael Cox - Stifel, Nicolaus & Co., Inc.: Okay. Thanks. And then maybe some questions on the spin-off and sort of the discussions you guys are having now. One of the topics I know you've talked about is, is adding more leverage to the lease fleet and sounds like it's probably going to come up from the 25% where you are now on book-to-value on the wholly owned fleet, but maybe not up to the 75% that you have in the other platform. Can you talk about where you're comfortable with leverage maybe between those two endpoints and what you're targeting?

Yeah, Brady, it's James. We're certainly still looking at the capital structure, spending a lot of time with our board, with our external advisors, those kind of folks. What I would remind you is – and we've talked about before the willingness to certainly increase the leverage on the lease fleet. Given the cash flows we've had the last several years, the investments we've needed to make, we haven't had that need. And so, the leverage has kind of naturally trended down as we've grown the fleet. We've certainly been at much higher levels before. If you look at our partially owned fleet, it's levered up in those 60% to 70% type ballpark. But one thing that we have to consider as we go through the capital structure of both companies, both infrastructure and Trinity, is the Trinity Industries company will be a hybrid manufacturing and leasing company. So, it's not a stand-alone leasing company. So, we have to think about that from a credit perspective and how we blend that debt. But certainly, we're taking a hard look at that. We know we have balance sheet capacity. We have a very liquid balance sheet right now with a lot of cash and certainly have the room for some leverage in the lease fleet without a doubt on pure metrics. We'll be taking a good hard look at that. And as Tim and I and the team look at the growth opportunities that we talked about earlier, we don't think we're going to be limited by the balance sheet. Brady Michael Cox - Stifel, Nicolaus & Co., Inc.: Okay. Thank you.

Our next question is from Bascome Majors of Susquehanna.

Yeah. Thanks for taking my question this morning. Does your guidance assume that you had any debt financing on a consolidated basis this year and can you kind of expand that? What's a good estimate for interest expense in 2018?

Yeah. This is James, Bascome. We don't provide a lot of detail there, but I wouldn't look at interest expense as changing a whole lot. We talked about the convertible notes that have a call in June, and we'll be making that decisions as we go through the year working with our board and others. Whether that gets repaid with cash, whether that's a refinancing or something like that, there are some technicalities within the convert that they are right now booked at a higher interest rate just because of the terms of how they were put together 12 years ago. When the call option hits in June of this year, there's a step-down in the GAAP interest rate. I can certainly walk you through some of that offline. So, from that perspective, you have a bit of a step-down, but it's really going to be how we put the capital structure together for both new companies and how and if we call those notes and if we refinance those and what we do with our cash. So, some moving parts in there, but I would say in general your guidance doesn't do a lot to interest expense versus where it's been.

I appreciate all that. And I believe in – when you were going through the finance part of the prepared remarks, you said that your share repurchase blackout period started in January. Could you confirm that and let us know when your buy window reopens and maybe when it closes again? I assume at quarter end.

Yeah, Bascome, this is James. Our standard blackout window that we've put on ourselves internally is at quarter end our blackout begins and after earnings it reopens. Now, that of course has the exception of if there's non-public information, for example, obviously the spin-off, we weren't buying until mid-December last quarter as we just told you in my earlier remarks. So, there are periods of time where we have other reasons to be blacked out, but that's the standard window around earnings.

I mean, the spin-off not being completed until 4Q, does that put you in a restricted period arguably for the rest of the year, or will there be some opportunities to buy your stock before the spin?

No, Bascome, the spin-off is public now. So, if there's things that go along that we deem as material and non-public that we've not yet disclosed, we may enter those type of decisions as we visit with legal counsel and are appropriately repurchasing or not. But the spin-off itself would not preclude us from buying back stock. That's public information.

Thank you.

Our next question is from Willard Milby of Seaport Global Securities.

Hey, good morning, everybody. Just wanted to ask a question on the sale of leased railcars, sounds like you've got some visibility as to the quarters in which that's going to happen. Do you have a similar visibility as to whether those are going to come from the cars owned less than a year or cars owned more than a year?

Yeah. This is James. That's hard. We're still in the process of putting those portfolios together. It generally is a mix of relatively new cars off the manufacturing line, maybe cars that we've had in the fleet just a few months, as well as cars that have been in the fleet quite some time. And the benefit of that is, it gives our RIV partners and investors a good diversification and mix of cars, newer cars versus a little bit older cars, and it helps us maintain our diversification as well. So, we don't lean one way or the other, it's generally a mix, but we don't have that type of breakdown. And your question, Willard, is a good one, because that makes revenues a little harder to forecast, which is why you don't see us providing that type of guidance. Until we've put the portfolio together and transacted the car sale, we really don't have a good sense.

Right. Okay. And also on the lease fleet, sounds like we've got some expenses tied to some tank retrofits here in 2018. Is that something you all expect to roll off moving into 2019? And also, are you experiencing some elevated expenses maybe in regards to sales efforts, or having to prep cars for renewal or new customers here in 2018? And is that kind of expense expected to continue from 2018 to 2019 when looking at the operating profitability of the leased fleet?

Willard, this is James. Let me clarify one piece, then I'll let Eric talk about kind of what we're seeing in the market for modifications. The majority of the capital that's invested in the modifications will be capital expenditures and not expense, and then you'll have depreciation. So, the figure that I provided, the $60 million will be capital. So, it doesn't affect operating income much in that respect, especially when we're modifying our own fleet, as we're modifying cars for external customers, that's a service we provide and that does enhance operating income. But, Eric, maybe you can talk about kind of what we're seeing beyond 2018.

Sure. In terms of the timing of modifications, we intend to continue to modify those cars in 2018 and throughout the periods that we're required to modify them. It should be relatively smooth over those periods. A lot of it will time around compliance events for those cars. And so, that's our expectation right now.

All right. That's it from me. Thanks for the time.

Thank you.

And we have a question from Steve Barger of KeyBanc Capital Markets.

Hey. Good morning, guys.

Morning.

Can you talk about what percentage of Trinity's working capital the infrastructure business represents on a normalized basis and maybe give us some color on normalized free cash flow as a percentage of revenue for those businesses?

Yeah. Steve, this is James. You'll see in our 10-K some of those statistics that will help you to some degree. I wouldn't get into that type of detail yet. I would also remind you that we've not really laid out real specifically the composition of which businesses are going where, even though we've generally talked about infrastructure businesses and primarily rail-related businesses that will stay with Trinity Industries. So, as we get further in the process, we'll be able to provide that type of detail for you. A lot of that, again, is available in the 10-K on broad strokes. But we'll provide more detail in the coming months as we really break that down.

Okay. And you talked about having the ability to sell more wind towers with the available capacity. Can you talk about inquiry activity there or just how would you characterize the demand environment for that business?

Bill?

Yeah. Steve, I would characterize the wind tower demand as kind of really spotty. So, it's bigger orders and they come just in dribs and drabs. There are two or three potential orders out there at this point in time, but you're never going to have just a long slew of potential orders.

Got it. And I'll just try one more just similar to the capital deployment strategy for the Rail business, any broad strokes information on the infrastructure business about focus areas for growth either organically or from acquisition?

This is James again, Steve. Again, I think it'd be pretty broad. I think as we've talked about over the years, our ability to build on our current platforms that will be in the infrastructure business as well as potentially create new platforms is pretty broad. I mean, infrastructure itself is a pretty broad term and that's very intentional in that it covers a lot of different industries, some of which we're in, a lot of which we're not. We've talked about the construction businesses, the energy sector, those type things. So, we wouldn't get real specific yet. But the good thing is just like I answered on the rail side, you're going to have a dedicated team with dedicated focus and very precise capital that's going to be able to be allocated there rather than kind of competing with what the best uses between the Rail business and the infrastructure side. So, I'd say, stay tuned to some of the vision and strategic thoughts that we have about where we may allocate the capital, but it is pretty broad which is – what's very encouraging for that business.

And this is Tim. As soon as Antonio arrives, then he'll put together a team and they will be looking at a lot of the various strategic alternatives that they have. He's been sitting in the board meetings and heard the presentations that we have given and talked about. So, it's not new news to him. It's just a matter of him transitioning out of his current job and then working things to where he can get up here on a full-time basis.

And this does conclude the question-and-answer session. I'd be happy to return the call to Gail Peck.

Thank you, Leo. That concludes today's conference call. A replay of today's call will be available after 1:00 Eastern Standard Time through midnight on March 1. The access number is 402-220-0459. 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 Trinity Industries' fourth quarter and full year results conference call. You may now disconnect your lines and, everyone, have a great day.