UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of ...

Part I [Identity of Directors, Senior Management and Advisers](index=4&type=section&id=Item%201.%20Identity%20of%20Directors%2C%20Senior%20Management%20and%20Advisers) This section is not applicable as stated in the report - The report states that this item is not applicable[18](index=18&type=chunk) [Offer Statistics and Expected Timetable](index=4&type=section&id=Item%202.%20Offer%20Statistics%20and%20Expected%20Timetable) This section is not applicable as stated in the report - The report states that this item is not applicable[19](index=19&type=chunk) [Key Information](index=4&type=section&id=Item%203.%20Key%20Information) This section presents key financial data for the past five years, capitalization details, and an extensive discussion of business, industry, and common share risk factors [Selected Financial Data](index=4&type=section&id=A.%20Selected%20Financial%20Data) This section presents selected financial data for fiscal years 2015 through 2019, derived from audited consolidated financial statements, highlighting net income and total assets trends Selected Financial Data (Years Ended December 31) | Indicator | 2019 ($ in thousands) | 2018 ($ in thousands) | 2017 ($ in thousands) | | :--- | :--- | :--- | :--- | | **Lease Rental Income** | $619,760 | $612,704 | $549,454 | | **Income from Operations** | $222,684 | $194,426 | $143,866 | | **Net Income Attributable to TGH** | $56,724 | $50,378 | $19,365 | | **Diluted EPS** | $0.99 | $0.88 | $0.34 | | **Total Assets** | $5,202,617 | $4,768,769 | $4,401,252 | | **Total Liabilities** | $3,916,972 | $3,532,778 | $3,195,215 | | **Total TGH Shareholders' Equity** | $1,259,379 | $1,206,813 | $1,148,297 | | **Utilization Rate** | 97.40% | 98.10% | 96.40% | | **Total Fleet in TEU (End of Period)** | 3,500,812 | 3,354,724 | 3,279,892 | [Risk Factors](index=6&type=section&id=D.%20Risk%20Factors) This section details significant risks to the company's business, financial condition, and share price, including global trade dependency, demand volatility, lessee defaults, high indebtedness, and dual listing implications - The demand and pricing for leased containers are subject to factors beyond the company's control, such as world trade growth, economic conditions, container prices, and shipping line consolidation[27](index=27&type=chunk)[29](index=29&type=chunk)[31](index=31&type=chunk) - The company has significant outstanding debt of **$3.8 billion** as of December 31, 2019, which reduces financial flexibility and requires substantial cash flow for servicing[57](index=57&type=chunk)[58](index=58&type=chunk) - A substantial portion of lease billings comes from a limited number of lessees. In 2019, the top 20 customers accounted for **82.1%** of total fleet billings, with the two largest customers, MSC and CMA-CGM, representing **15.4%** and **13.1%**, respectively[53](index=53&type=chunk) - The bankruptcy of Hanjin Shipping in 2016 had a substantial impact, causing significant costs from container recovery, unpaid rent, and re-leasing containers at lower rates. The company recovered **94%** of its containers leased to Hanjin[37](index=37&type=chunk) - As a foreign private issuer, the company is exempt from certain NYSE corporate governance requirements, such as having a majority of independent directors on the board[158](index=158&type=chunk)[159](index=159&type=chunk) - In December 2019, the company commenced a dual listing on the Johannesburg Stock Exchange (JSE). This followed the unbundling of shares by its major shareholder, Trencor, which reduced its stake from **47.5%** to **5.3%**. This dual listing introduces risks related to South African corporate governance practices and potential share price volatility[151](index=151&type=chunk)[152](index=152&type=chunk) [Information on the Company](index=34&type=section&id=Item%204.%20Information%20on%20the%20Company) This section provides a comprehensive overview of Textainer's business, history, and organizational structure, detailing its operations as a leading intermodal container lessor, core segments, and global footprint [History and Development of the Company](index=34&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) This section outlines Textainer's history, including its 1993 Bermuda incorporation, NYSE and JSE listings, and significant events like the 2019 LAPCO fleet acquisition - In December 2019, the company acquired Leased Assets Pool Company Limited (LAPCO), which owned a fleet of approximately 161,000 TEU managed by Textainer. The purchase involved **$65.5 million** in cash and repayment of LAPCO's **$126.3 million** debt facility[178](index=178&type=chunk) - The company commenced a secondary listing of its common shares on the Johannesburg Stock Exchange (JSE) on December 11, 2019, under the symbol 'TXT'[177](index=177&type=chunk) Capital Expenditures and Proceeds from Asset Sales | Year | Capital Expenditures ($ in millions) | Proceeds from Sale of Assets ($ in millions) | | :--- | :--- | :--- | | 2019 | $748.4 million | $150.7 million | | 2018 | $854.4 million | $147.3 million | | 2017 | $300.1 million | $135.3 million | [Business Overview](index=36&type=section&id=B.%20Business%20Overview) Textainer operates as a leading global intermodal container lessor with a **3.5 million TEU** fleet across three segments: Container Ownership, Management, and Resale, serving approximately 250 shipping lines - As of December 31, 2019, Textainer's total fleet was approximately **2.3 million containers**, representing **3.5 million TEU**[181](index=181&type=chunk)[200](index=200&type=chunk) Fleet Composition by Ownership (as of Dec 31, 2019) | Ownership | TEU | % of Total TEU | | :--- | :--- | :--- | | Owned | 2,990,172 | 85.4% | | Managed | 510,640 | 14.6% | | **Total** | **3,500,812** | **100.0%** | - The company leases containers under various structures: term leases (**75.1%** of on-hire fleet), master leases (**12.4%**), spot leases (**2.1%**), and finance leases (**10.4%**) as of December 31, 2019[221](index=221&type=chunk)[223](index=223&type=chunk)[224](index=224&type=chunk)[226](index=226&type=chunk) - Customer concentration is high, with the top 20 customers accounting for **82.1%** of 2019 lease billings. The two largest customers, Mediterranean Shipping Company S.A. and CMA-CGM S.A., accounted for **15.4%** and **13.1%** of billings, respectively[248](index=248&type=chunk) - The company is a major supplier of leased marine containers to the U.S. Military under a contract with USTranscom, which was renewed in January 2019 for a base year with four option years through February 2024[237](index=237&type=chunk)[238](index=238&type=chunk) [Organizational Structure](index=50&type=section&id=C.%20Organizational%20Structure) Textainer Group Holdings Limited operates as a Bermuda-based holding company with primary subsidiaries Textainer Limited and Textainer Equipment Management Limited, and a **50.1%** stake in TAP Funding Ltd - Textainer Group Holdings Limited is a holding company with two primary direct subsidiaries: Textainer Equipment Management Limited (TEML) for management services and Textainer Limited (TL) for container ownership[170](index=170&type=chunk)[175](index=175&type=chunk) - The company consolidates TAP Funding Ltd, a joint venture where it holds **50.1%** of common shares and **66.7%** of voting rights[260](index=260&type=chunk) - Following a secondary listing on the JSE and a share distribution, Trencor Limited's ownership stake in the company was reduced from **47.5%** to approximately **5.3%** as of December 31, 2019[262](index=262&type=chunk) [Property, Plant and Equipment](index=51&type=section&id=D.%20Property%2C%20Plant%20and%20Equipment) The company operates from **14** leased regional and area offices across **13** countries, with headquarters in Bermuda and administrative offices in San Francisco - The company operates from **14 regional and area offices** in **13 countries**, with its headquarters in Bermuda and administrative office in San Francisco[263](index=263&type=chunk) - All office space is leased. The lease for the San Francisco office expires in **May 2027**, the UK office in **December 2024**, and the Singapore office in **November 2021**[264](index=264&type=chunk) [Operating and Financial Review and Prospects](index=51&type=section&id=Item%205.%20Operating%20and%20Financial%20Review%20and%20Prospects) This section provides management's discussion and analysis of the company's financial condition and operating results, covering performance drivers, liquidity, capital resources, and critical accounting policies [Operating Results](index=56&type=section&id=A.%20Operating%20Results) This section analyzes the company's operating results for 2019, detailing changes in lease rental income, operating expenses, interest expense, and net income, along with segment performance Comparison of Revenues and Gain on Sale (2019 vs 2018) | Revenue/Gain Type | 2019 ($ in thousands) | 2018 ($ in thousands) | % Change | | :--- | :--- | :--- | :--- | | Lease Rental Income | 619,760 | 612,704 | 1.2% | | Management Fees - non-leasing | 7,590 | 8,529 | (11.0%) | | Trading Container Margin | 7,398 | 3,450 | 114.4% | | Gain on Sale of Owned Fleet | 21,397 | 36,071 | (40.7%) | Comparison of Operating Expenses (2019 vs 2018) | Expense Type | 2019 ($ in thousands) | 2018 ($ in thousands) | % Change | | :--- | :--- | :--- | :--- | | Direct Container Expense - Owned Fleet | 45,831 | 53,845 | (14.9%) | | Depreciation Expense | 260,372 | 249,500 | 4.4% | | Container Lessee Default Expense | 7,867 | 17,948 | (56.2%) | | General & Administrative Expense | 38,142 | 44,317 | (13.9%) | | **Total Operating Expenses** | **433,461** | **466,328** | **(7.0%)** | - The Container Ownership segment's income before tax decreased by **45.4%** to **$14.3 million** in 2019, primarily due to higher interest and depreciation expenses and a lower gain on sale of containers[316](index=316&type=chunk)[317](index=317&type=chunk) - The Container Management segment's income before tax increased by **36.5%** to **$27.7 million** in 2019, driven by lower distribution expenses to investors and reduced G&A costs[316](index=316&type=chunk)[317](index=317&type=chunk) [Liquidity and Capital Resources](index=63&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) This section details the company's liquidity and capital resources, outlining cash position, outstanding debt, available debt facilities, and cash flow activities for 2019 Outstanding Debt as of Dec 31, 2019 | Facility | Total Commitment ($ in thousands) | Current Borrowing ($ in thousands) | | :--- | :--- | :--- | | TL Revolving Credit Facility | 1,500,000 | 1,286,289 | | TMCL II Secured Debt Facility | 1,200,000 | 694,506 | | Various Bonds & Term Loans | 1,692,975 | 1,692,975 | | TAP Funding Revolving Credit | 190,000 | 153,525 | | **Total** | **4,582,975** | **3,827,295** | Cash Flow Summary (2019 vs 2018) | Cash Flow Activity | 2019 ($ in thousands) | 2018 ($ in thousands) | | :--- | :--- | :--- | | Net Cash from Operating Activities | 428,545 | 316,119 | | Net Cash used in Investing Activities | (761,792) | (736,787) | | Net Cash from Financing Activities | 386,182 | 408,154 | - The company has entered into interest rate swap and cap agreements with a total notional amount of **$1.031 billion** as of December 31, 2019, to mitigate exposure from its **$2.134 billion** in floating-rate debt[345](index=345&type=chunk)[346](index=346&type=chunk) [Contractual Obligations](index=69&type=section&id=F.%20Tabular%20Disclosure%20of%20Contractual%20Obligations) This section provides a tabular disclosure of the company's contractual obligations as of December 31, 2019, detailing total obligations and payment schedules Contractual Obligations as of December 31, 2019 (in thousands) | Obligation Type | Total ($ in thousands) | Due in 2020 ($ in thousands) | Due in 2021-2022 ($ in thousands) | Due in 2023-2024 ($ in thousands) | Due 2025 & thereafter ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total debt obligations | $3,827,295 | $250,553 | $950,020 | $1,283,377 | $1,343,345 | | Interest on obligations | $533,645 | $135,866 | $226,719 | $126,219 | $44,841 | | Interest rate swaps/caps | $10,046 | $4,250 | $5,820 | $(24) | $0 | | Office lease obligations | $15,966 | $2,232 | $4,239 | $4,266 | $5,229 | | Container contracts payable | $9,394 | $9,394 | $0 | $0 | $0 | | **Total** | **$4,396,346** | **$402,295** | **$1,186,798** | **$1,413,838** | **$1,393,415** | [Directors, Senior Management and Employees](index=70&type=section&id=Item%206.%20Directors%2C%20Senior%20Management%20and%20Employees) This section provides information on the company's Board of Directors, senior management, and employees, including compensation details, share incentive plans, and workforce size - The Board of Directors consists of **eight members**, with directors serving staggered three-year terms. As of **March 30, 2020**, key executives include Olivier Ghesquiere (President & CEO) and Michael K. Chan (EVP & CFO)[384](index=384&type=chunk)[385](index=385&type=chunk)[387](index=387&type=chunk) - Aggregate direct compensation for the two executive officers in 2019 was approximately **$1.75 million**, including bonuses and vested stock. Non-officer directors received an aggregate of approximately **$531,000**[404](index=404&type=chunk)[407](index=407&type=chunk) - The 2019 Share Incentive Plan was approved, increasing the number of shares available for issuance by **2.5 million**. As of December 31, 2019, **2,461,153 shares** were available for future issuance under this plan[408](index=408&type=chunk) - As of December 31, 2019, the company had approximately **170 employees** and is not a party to any collective bargaining agreements[423](index=423&type=chunk) [Major Shareholders and Related Party Transactions](index=75&type=section&id=Item%207.%20Major%20Shareholders%20and%20Related%20Party%20Transactions) This section details the company's ownership structure, identifying major shareholders and beneficial ownership by directors, and outlines significant related party transactions including the LAPCO acquisition Major Shareholders as of December 31, 2019 | Holder | Beneficial Ownership (%) | | :--- | :--- | | Coronation Asset Management (Pty) Ltd. | 11.8% | | Isam K. Kabbani | 6.5% | | Trencor Limited | 5.3% | | Directors and Executive Officers (as a group) | 9.5% | - In December 2019, Trencor Limited reduced its ownership from **47.5%** to **5.3%** through a distribution of shares to its own shareholders, which now trade on the JSE[429](index=429&type=chunk)[437](index=437&type=chunk) - The company acquired LAPCO from TAC Limited, a wholly-owned subsidiary of Trencor, on December 31, 2019. Two of Textainer's directors, Hennie Van der Merwe and David M. Nurek, are also directors of Trencor[437](index=437&type=chunk)[443](index=443&type=chunk) - The company has a management agreement with Maccarone Container Fund, LLC, which is beneficially owned by director John Maccarone and his family[436](index=436&type=chunk) [Financial Information](index=80&type=section&id=Item%208.%20Financial%20Information) This section confirms the inclusion of audited financial statements, absence of material legal proceedings, and discusses the discretionary dividend policy which was eliminated in **Q4 2016** - The company's dividend policy is discretionary and subject to board approval, legal requirements, and debt covenants. The dividend was eliminated in **Q4 2016** and has not been reinstated[142](index=142&type=chunk)[452](index=452&type=chunk) - No significant changes have occurred since the date of the audited financial statements (December 31, 2019)[456](index=456&type=chunk) [The Offer and Listing](index=81&type=section&id=Item%209.%20The%20Offer%20and%20Listing) This section details the trading of the company's common shares, primarily listed on the NYSE under 'TGH' and secondarily on the JSE under 'TXT' since December 2019 - The company's common shares are primary listed on the NYSE under the symbol 'TGH' and secondary listed on the JSE under the symbol 'TXT'[457](index=457&type=chunk) Annual NYSE Stock Price Range | Year | High ($) | Low ($) | | :--- | :--- | :--- | | 2019 | 13.95 | 6.74 | | 2018 | 25.85 | 9.30 | | 2017 | 23.55 | 8.50 | [Additional Information](index=82&type=section&id=Item%2010.%20Additional%20Information) This section covers supplementary corporate information, including organizational documents, South African exchange controls, and a detailed summary of Bermuda and U.S. federal income tax consequences for the company and its shareholders - The company has obtained assurance from the Bermuda Minister of Finance that it will not be subject to any potential future Bermuda taxes on profits, income, or capital gains until **March 31, 2035**[474](index=474&type=chunk) - A portion of the company's income is treated as effectively connected with a U.S. trade or business and is subject to U.S. federal income tax[483](index=483&type=chunk)[485](index=485&type=chunk) - The company believes it was not a Passive Foreign Investment Company (PFIC) for the prior taxable year and does not expect to be one for the current year, but notes the determination is factual and made annually. The company does not intend to provide the information necessary for shareholders to make a QEF election[508](index=508&type=chunk)[511](index=511&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=91&type=section&id=Item%2011.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to market risks, primarily interest rate fluctuations, and outlines mitigation strategies including derivative instruments and credit risk management - The company's primary market risk is interest rate risk. A hypothetical **1%** increase in interest rates would increase net interest expense by an estimated **$11.3 million** annually[546](index=546&type=chunk) - To mitigate interest rate risk, the company uses derivative instruments. As of December 31, 2019, it had interest rate swap and cap agreements with a total notional amount of **$1.03 billion**[538](index=538&type=chunk)[544](index=544&type=chunk)[545](index=545&type=chunk) - Credit risk is concentrated, with customers in Taiwan, PRC, France, Switzerland, and Singapore accounting for **15.5%**, **14.1%**, **14.0%**, **13.3%**, and **11.1%** of total fleet container lease billings in 2019, respectively[547](index=547&type=chunk) Part II [Controls and Procedures](index=93&type=section&id=Item%2015.%20Controls%20and%20Procedures) Management and **KPMG LLP** concluded that the company's disclosure controls and internal control over financial reporting were effective as of **December 31, 2019** - Management concluded that the company's disclosure controls and procedures were effective as of **December 31, 2019**[553](index=553&type=chunk)[554](index=554&type=chunk) - Management concluded that the company's internal control over financial reporting was effective for the year ended **December 31, 2019**, based on the **COSO framework**[555](index=555&type=chunk) - **KPMG LLP**, the independent registered public accounting firm, audited the internal control over financial reporting and issued an **unqualified opinion** on its effectiveness as of **December 31, 2019**[558](index=558&type=chunk) [Other Information](index=94&type=section&id=Item%2016.%20Other%20Information) This section covers various governance and compliance topics, including audit committee financial experts, accountant fees, share repurchase programs, and corporate governance practices for a foreign private issuer [Audit Committee Financial Expert](index=94&type=section&id=16A.%20Audit%20Committee%20Financial%20Expert) This section identifies Messrs. Shwiel and Cottingham as the audit committee financial experts, with all four committee members deemed independent - The Board of Directors has determined that Messrs. Hyman Shwiel and Dudley R. Cottingham are audit committee financial experts[559](index=559&type=chunk) [Principal Accountant Fees and Services](index=95&type=section&id=16C.%20Principal%20Accountant%20Fees%20and%20Services) This section details fees billed by the principal accountant, **KPMG LLP**, for professional services in 2019 and 2018, all of which were pre-approved by the audit committee Accountant Fees (in thousands) | Fee Category | 2019 ($ in thousands) | 2018 ($ in thousands) | | :--- | :--- | :--- | | Audit Fees | $1,792 | $1,835 | | Audit-Related Fees | $30 | $173 | | Tax Fees | $6 | $14 | | **Total Fees** | **$1,828** | **$2,022** | [Purchases of Equity Securities by the Issuer and Affiliated Purchasers](index=95&type=section&id=16E.%20Purchases%20of%20Equity%20Securities%20by%20the%20Issuer%20and%20Affiliated%20Purchasers) This section details the company's share repurchase program, including shares repurchased in 2019 and the subsequent increase in authorization in **March 2020** - The company repurchased **878,637 common shares** at an average price of **$9.75 per share** for a total cost of approximately **$8.6 million** during 2019[568](index=568&type=chunk)[571](index=571&type=chunk) - In **March 2020**, the board of directors increased the share repurchase program authorization from **$25 million** to **$50 million**[568](index=568&type=chunk)[820](index=820&type=chunk) [Corporate Governance](index=96&type=section&id=16G.%20Corporate%20Governance) As a foreign private issuer, Textainer adheres to Bermuda corporate governance practices, leveraging NYSE exemptions while maintaining independent directors and established committees - The company is a foreign private issuer and follows Bermuda corporate governance practices in lieu of certain NYSE requirements[573](index=573&type=chunk) - While not required, as of **March 2020**, **six of the eight directors** are independent as defined by the NYSE[574](index=574&type=chunk) - The company has established audit, compensation, and nominating/governance committees and has adopted charters for each, along with corporate governance guidelines and a code of business conduct[575](index=575&type=chunk) Part III [Financial Statements](index=98&type=section&id=Item%2018.%20Financial%20Statements) This section presents the company's audited consolidated financial statements for 2017-2019, including the independent auditor's report, key financial statements, and detailed notes on accounting policies and financial matters - The financial statements were audited by **KPMG LLP**, which provided an **unqualified opinion** on both the financial statements and the effectiveness of internal control over financial reporting[582](index=582&type=chunk)[588](index=588&type=chunk) - The company adopted the new lease accounting standard (**ASC 842**) on **January 1, 2019**, which resulted in the recognition of right-of-use assets and lease liabilities for office space leases on the balance sheet[584](index=584&type=chunk)[697](index=697&type=chunk) Consolidated Income Statement Highlights (in thousands) | Line Item | 2019 ($ in thousands) | 2018 ($ in thousands) | 2017 ($ in thousands) | | :--- | :--- | :--- | :--- | | Lease Rental Income | $619,760 | $612,704 | $549,454 | | Income from Operations | $222,684 | $194,426 | $143,866 | | Net Income Attributable to TGH | $56,724 | $50,378 | $19,365 | Consolidated Balance Sheet Highlights (in thousands) | Line Item | Dec 31, 2019 ($ in thousands) | Dec 31, 2018 ($ in thousands) | | :--- | :--- | :--- | | Total Assets | $5,202,617 | $4,768,769 | | Containers, net | $4,156,151 | $4,134,016 | | Total Liabilities | $3,916,972 | $3,532,778 | | Total TGH Shareholders' Equity | $1,259,379 | $1,206,813 | [Exhibits](index=153&type=section&id=Item%2019.%20Exhibits) This section lists all exhibits filed with the Annual Report on Form 20-F, including organizational documents, material contracts, employment agreements, and various certifications - The report includes numerous exhibits, such as the company's organizational documents, key employment agreements, share incentive plans, and major debt facility agreements[832](index=832&type=chunk)[833](index=833&type=chunk)

Part I [Key Information](index=4&type=section&id=Item%203.%20Key%20Information) This section presents selected five-year financial data and outlines key business, industry, and share ownership risks [Selected Financial Data](index=4&type=section&id=A.%20Selected%20Financial%20Data) Provides key financial and operational metrics from 2014 to 2018, showing performance trends and a recovery in 2018 Selected Financial Data (2014-2018) (in thousands, except per share data and utilization rate) | Indicator | 2018 | 2017 | 2016 | 2015 | 2014 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Lease Rental Income** | $612,704 | $549,454 | $565,938 | $646,505 | $656,241 | | **Income from Operations** | $194,426 | $143,866 | $26,210 | $211,819 | $272,749 | | **Net Income (Loss) Attributable to Shareholders** | $50,378 | $19,365 | $(52,483) | $108,408 | $190,555 | | **Diluted EPS** | $0.88 | $0.34 | $(0.93) | $1.90 | $3.34 | | **Cash Dividends per Share** | $— | $— | $0.51 | $1.65 | $1.88 | | **Total Assets** | $4,744,296 | $4,380,342 | $4,294,026 | $4,365,312 | $4,334,748 | | **Long-term Debt** | $3,409,827 | $2,990,308 | $3,038,297 | $3,003,648 | $2,974,311 | | **Utilization Rate** | 98.10% | 96.40% | 94.70% | 96.80% | 96.10% | [Risk Factors](index=6&type=section&id=D.%20Risk%20Factors) Details significant risks affecting the company's business, financial condition, and common shares [Risks Related to Our Business and Industry](index=6&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Industry) Outlines industry-specific risks including global trade dependency, lessee credit risk, and regulatory changes - Demand for leased containers is highly dependent on factors beyond the company's control, such as the **rate of growth of world trade**, economic conditions, and customers' 'lease vs buy' decisions[27](index=27&type=chunk)[29](index=29&type=chunk) - The August 2016 bankruptcy of Hanjin Shipping Co, which represented approximately **4.8% of the company's total fleet**, resulted in substantial costs and significantly impacted financial performance[37](index=37&type=chunk) - A significant portion of lease billings comes from a limited number of lessees, with the **top 20 customers accounting for 82.8% of total fleet billings** in 2018, concentrating credit risk[52](index=52&type=chunk)[54](index=54&type=chunk) - The company operates with **significant debt, totaling $3,437.8 million** as of December 31, 2018, which reduces financial flexibility[57](index=57&type=chunk)[58](index=58&type=chunk) - New International Maritime Organization (IMO) rules effective January 1, 2020, will reduce permitted sulphur oxide emissions, **potentially increasing costs for shipping line customers** and weakening their financial performance[45](index=45&type=chunk) [Risks Related to Our Common Shares](index=30&type=section&id=Risks%20Related%20to%20Our%20Common%20Shares) Covers risks for common shareholders, including price volatility and concentrated ownership influence - The market price of common shares has been **highly volatile**, fluctuating from an intra-day low of $4.23 to a high of $43.96 since the IPO[147](index=147&type=chunk) - Trencor Limited, a South African company, owns approximately **47.5% of outstanding common shares**, giving it significant influence over shareholder matters and the ability to prevent a change in control[150](index=150&type=chunk) - As a foreign private issuer, the company is **exempt from certain NYSE corporate governance rules**, such as the requirement for a majority of independent directors on the board[159](index=159&type=chunk)[160](index=160&type=chunk) - The company's bye-laws contain provisions that may **discourage a change of control**, such as a supermajority vote requirement and a classified board with staggered terms[165](index=165&type=chunk) [Information on the Company](index=35&type=section&id=Item%204.%20Information%20on%20the%20Company) Details the company's history, business segments, competitive position, and organizational structure [History and Development of the Company](index=35&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) Highlights significant corporate events from 2016 to 2018, including the Hanjin bankruptcy impact and major financing activities - In August 2016, the bankruptcy of Hanjin Shipping Co led to a **$22.1 million impairment charge** and a **$19.0 million bad debt expense** for the company in that year[173](index=173&type=chunk)[174](index=174&type=chunk) - In 2017, the company issued **$920 million in Fixed Rate Asset Backed Notes** to repay existing debt and for other corporate purposes[176](index=176&type=chunk) - In September 2018, the TL Revolving Credit Facility was amended, **increasing its commitment from $700 million to $1.5 billion** and extending its maturity to 2023[186](index=186&type=chunk) - In October 2018, the company purchased the remaining **75% of TW Container Leasing Ltd** from Wells Fargo Container Corp for $29.7 million[189](index=189&type=chunk) Capital Expenditures and Proceeds from Asset Sales (2016-2018) | Year | Capital Expenditures | Proceeds from Sale of Assets | | :--- | :--- | :--- | | 2018 | $854.4 million | $147.3 million | | 2017 | $300.1 million | $135.3 million | | 2016 | $505.5 million | $126.6 million | [Business Overview](index=38&type=section&id=B.%20Business%20Overview) Describes the company's position as a leading container lessor, its fleet composition, lease types, and strategic focus - The company operates a total fleet of approximately 2.2 million containers, representing **almost 3.4 million TEU**, making it one of the world's largest lessors[195](index=195&type=chunk) - The business is structured into three core segments: **Container Ownership (79% of fleet)**, **Container Management (21% of fleet)**, and **Container Resale**[198](index=198&type=chunk)[201](index=201&type=chunk) - As of December 31, 2018, approximately **81% of the company's total on-hire fleet was on long-term leases**, providing predictable revenue streams[216](index=216&type=chunk) - Key business strategies include leveraging its scale, being a reliable supplier, pursuing acquisitions, maintaining high utilization and operating efficiency, and growing the container resale business[225](index=225&type=chunk)[226](index=226&type=chunk)[227](index=227&type=chunk)[228](index=228&type=chunk)[231](index=231&type=chunk) Top Intermodal Leasing Companies by TEU (Jan 2018) | Company | TEU (000's) | Percent of Total | | :--- | :--- | :--- | | Triton International Limited | 5,650 | 27.2% | | Florens Leasing | 3,700 | 17.8% | | **Textainer** | **3,355** | **16.1%** | | SeaCo Global | 2,400 | 11.5% | | Beacon Intermodal Leasing | 1,320 | 6.3% | [Organizational Structure](index=52&type=section&id=C.%20Organizational%20Structure) Outlines the corporate structure, key subsidiaries, and the significant ownership stake held by Trencor Limited - Textainer Group Holdings Limited is a holding company with two main direct subsidiaries: **Textainer Equipment Management Limited (TEML)** and **Textainer Limited (TL)**[170](index=170&type=chunk) - The principal shareholder, **Trencor Limited, held 47.5%** of the company's outstanding shares as of December 31, 2018[284](index=284&type=chunk) [Property, Plant and Equipment](index=53&type=section&id=D.%20Property%2C%20Plant%20and%20Equipment) Details the company's global office locations, all of which are operated under lease agreements - The company operates through **14 regional and area offices in 13 countries**, with its headquarters in Bermuda and an administrative office in San Francisco[285](index=285&type=chunk) - All office spaces are leased, with the **San Francisco lease expiring in May 2027** and the Bermuda office lease expiring in December 2020[286](index=286&type=chunk) [Operating and Financial Review and Prospects](index=53&type=section&id=Item%205.%20Operating%20and%20Financial%20Review%20and%20Prospects) Provides management's analysis of financial results, liquidity, capital resources, and contractual obligations [Operating Results](index=57&type=section&id=A.%20Operating%20Results) Analyzes operating results for 2016-2018, highlighting revenue growth, expense drivers, and segment performance - **Lease rental income increased by 11.5%** from 2017 to 2018, primarily due to a 2.9% increase in average per diem rental rates, a 2.0% increase in utilization, and a 6.5% increase in the total fleet[315](index=315&type=chunk) - **Container impairment increased by 231.7%** from 2017 to 2018, primarily due to increased impairment for containers unlikely to be recovered from defaulting lessees[324](index=324&type=chunk) - **Interest expense rose 17.8%** from 2017 to 2018 due to a higher average debt balance and higher average interest rates[328](index=328&type=chunk) Revenue and Gain on Sale of Containers (2016-2018) (in thousands) | (In thousands) | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | **Lease rental income** | $612,704 | $549,454 | $565,938 | | **Management fees - non-leasing** | $8,529 | $7,146 | $5,937 | | **Trading container margin** | $3,450 | $1,456 | $(276) | | **Gain on sale of owned fleet containers, net** | $36,071 | $26,210 | $6,761 | Operating Expenses (2016-2018) (in thousands) | (In thousands) | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | **Direct container expense - owned fleet** | $58,813 | $60,321 | $62,596 | | **Depreciation expense** | $235,705 | $231,043 | $236,144 | | **Container impairment** | $26,775 | $8,072 | $94,623 | | **General and administrative expense** | $44,317 | $39,677 | $34,540 | | **Bad debt expense, net** | $2,697 | $477 | $21,166 | | **Gain on insurance recovery** | $(8,692) | $— | $— | | **Total operating expenses** | $466,328 | $440,400 | $552,150 | [Liquidity and Capital Resources](index=67&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) Details the company's sources of liquidity, debt facilities, cash flow trends, and dividend payment restrictions - The company is a holding company and depends on dividends and other payments from its subsidiaries to meet financial obligations and pay dividends, which are subject to certain limits[372](index=372&type=chunk) Debt Facilities as of Dec 31, 2018 (in thousands) | Facility | Current Borrowing | Total Commitment | Available Borrowing | | :--- | :--- | :--- | :--- | | TMCL II Secured Debt Facility | $657,637 | $1,200,000 | $— | | TL Revolving Credit Facility | $1,280,000 | $1,500,000 | $136,637 | | TAP Funding Revolving Credit Facility | $173,000 | $190,000 | $2,798 | | TMCL VI Term Loan | $278,724 | $278,724 | $— | | 2017-1 Bonds | $357,210 | $357,210 | $— | | 2017-2 Bonds | $439,915 | $439,915 | $— | | 2018-1 Bonds | $251,327 | $251,327 | $— | | **Total** | **$3,437,813** | **$4,217,176** | **$139,435** | Historical Cash Flow Summary (in thousands) | Cash Flow Activity | 2018 | 2017 | 2016 | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $252,272 | $250,975 | $277,894 | | Net cash used in investing activities | $(672,940) | $(85,364) | $(280,430) | | Net cash provided by (used in) financing activities | $408,154 | $(70,372) | $(4,619) | [Tabular Disclosure of Contractual Obligations](index=74&type=section&id=F.%20Tabular%20Disclosure%20of%20Contractual%20Obligations) Summarizes the company's total contractual obligations of approximately $4.12 billion as of December 31, 2018 Contractual Obligations as of December 31, 2018 (in thousands) | Obligation Type | Total | Due in 2019 | Due in 2020-2021 | Due in 2022-2023 | | :--- | :--- | :--- | :--- | :--- | | Total debt obligations | $3,437,813 | $197,427 | $554,277 | $1,509,945 | | Interest on obligations | $625,417 | $138,470 | $250,490 | $200,367 | | Office lease obligations | $17,621 | $2,186 | $4,222 | $3,930 | | Container contracts payable | $42,710 | $42,710 | $— | $— | | **Total** | **$4,120,940** | **$377,125** | **$809,634** | **$1,714,242** | [Directors, Senior Management and Employees](index=75&type=section&id=Item%206.%20Directors%2C%20Senior%20Management%20and%20Employees) Provides information on the company's leadership, compensation, board practices, and employee base - As of March 4, 2019, the board of directors consisted of eight members, with **two new executive appointments in 2018**: Olivier Ghesquiere as President and CEO, and Michael K Chan as EVP and CFO[411](index=411&type=chunk)[417](index=417&type=chunk)[428](index=428&type=chunk) - **Aggregate direct compensation** paid to executive officers as a group (four persons) for 2018 was approximately **$3.7 million**[430](index=430&type=chunk)[434](index=434&type=chunk) - The company's 2015 Share Incentive Plan allows for the grant of share options and other awards, with **330,060 shares available for future issuance** as of December 31, 2018[435](index=435&type=chunk) - As of December 31, 2018, the company had **178 employees** and is not a party to any collective bargaining agreements[450](index=450&type=chunk) [Major Shareholders and Related Party Transactions](index=80&type=section&id=Item%207.%20Major%20Shareholders%20and%20Related%20Party%20Transactions) Details the company's ownership structure and transactions with related parties, including its largest shareholder - The company has a management agreement with LAPCO, an indirect subsidiary of major shareholder Trencor, from which it received **$2.5 million in management fees** in 2018[467](index=467&type=chunk) - A **Voting Limitation Deed** is in place with Trencor to ensure that, for IFRS purposes, Trencor is not considered to have control or significant influence over the company[464](index=464&type=chunk) Major Shareholders as of March 4, 2019 | Holder | Beneficially Owned Shares | Percentage | | :--- | :--- | :--- | | Trencor Limited | 27,278,802 | 47.5% | | Isam K. Kabbani | 3,653,250 | 6.4% | | All directors and executive officers as a group (9 persons) | 29,489,553 | 51.4% | [Financial Information](index=84&type=section&id=Item%208.%20Financial%20Information) Confirms the inclusion of audited financial statements and outlines the company's dividend policy - The company's audited consolidated financial statements for the years ended December 31, 2018, 2017, and 2016 are included in the report[472](index=472&type=chunk) - The company **suspended its dividend payments after the third quarter of 2016**, with future payments subject to board discretion and debt covenants[474](index=474&type=chunk)[475](index=475&type=chunk)[476](index=476&type=chunk) Dividends Declared (2015-2016) (in thousands) | Date Declared | Dividend per Share | Total Dividend | | :--- | :--- | :--- | | February 2015 | $0.47 | $26,781 | | April 2015 | $0.47 | $26,783 | | July 2015 | $0.47 | $26,796 | | October 2015 | $0.24 | $13,719 | | February 2016 | $0.24 | $13,479 | | April 2016 | $0.24 | $13,577 | | August 2016 | $0.03 | $1,698 | [The Offer and Listing](index=86&type=section&id=Item%209.%20The%20Offer%20and%20Listing) Provides details about the trading market and historical stock price for the company's common shares - The company's common shares are listed on the **New York Stock Exchange (NYSE)** under the symbol **'TGH'**[480](index=480&type=chunk) Annual Stock Price Range (High/Low) | Year | High | Low | | :--- | :--- | :--- | | 2018 | $25.85 | $9.30 | | 2017 | $23.55 | $8.50 | | 2016 | $15.72 | $7.05 | | 2015 | $34.44 | $13.48 | | 2014 | $39.87 | $29.25 | [Additional Information](index=87&type=section&id=Item%2010.%20Additional%20Information) Provides supplementary corporate, tax, and regulatory information relevant to the company and its shareholders - The company is an **exempted company incorporated under the laws of Bermuda**[489](index=489&type=chunk) - Major shareholder Trencor is subject to **South African exchange control regulations**, which could restrict the company's ability to issue new shares[492](index=492&type=chunk) - The company has obtained an assurance from the Bermuda Minister of Finance that it will **not be subject to any tax on profits, income, or capital gains in Bermuda until March 31, 2035**[497](index=497&type=chunk) - A portion of the company's income is subject to U.S. federal income tax, and the company does not believe it was a **Passive Foreign Investment Company (PFIC)** for its prior taxable year[507](index=507&type=chunk)[531](index=531&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=96&type=section&id=Item%2011.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Details the company's exposure to foreign exchange and interest rate risks and its strategies for mitigation - The company's primary market risks are **foreign exchange rate risk** and **interest rate risk**[561](index=561&type=chunk) - In 2018, **19% of direct container expenses were paid in up to 20 different foreign currencies**, and the company does not hedge this exposure[562](index=562&type=chunk) - To mitigate interest rate risk, the company uses interest rate swaps, collars, and caps, with a **total notional amount of $1.23 billion** as of December 31, 2018[563](index=563&type=chunk)[568](index=568&type=chunk)[569](index=569&type=chunk) - A hypothetical **1% increase in interest rates** would result in a net increase of **$10.4 million in interest expense**[571](index=571&type=chunk) Part II [Controls and Procedures](index=98&type=section&id=Item%2015.%20Controls%20and%20Procedures) Discloses a material weakness in internal control over financial reporting and its impact on disclosure controls - Management concluded that **disclosure controls and procedures were not effective** as of December 31, 2018[581](index=581&type=chunk) - A **material weakness was identified** in internal control over financial reporting related to the accounting for management agreements for the managed fleet[585](index=585&type=chunk) - The control deficiency resulted in an immaterial restatement of prior period financial statements to change the presentation of managed fleet revenue and expenses from a 'net' to a 'gross' basis[582](index=582&type=chunk)[583](index=583&type=chunk)[586](index=586&type=chunk) - The independent auditor, KPMG LLP, issued an **adverse opinion on the effectiveness of the company's internal control** over financial reporting as of December 31, 2018[588](index=588&type=chunk) [Corporate Governance and Other Information](index=100&type=section&id=Item%2016A-G.%20Corporate%20Governance%20and%20Other%20Information) Covers various governance topics, including audit committee experts, codes of conduct, and accountant fees - The board has determined that Messrs Shwiel and Cottingham are **audit committee financial experts**[592](index=592&type=chunk) - The company has adopted a **Code of Business Conduct and Ethics** applicable to all directors and employees[593](index=593&type=chunk) - As a foreign private issuer, the company follows Bermuda corporate governance practices in lieu of certain NYSE requirements, such as **not having a majority of independent directors** on its board[604](index=604&type=chunk)[605](index=605&type=chunk) Principal Accountant Fees (in thousands) | Fee Category | 2018 | 2017 | | :--- | :--- | :--- | | Audit Fees | $1,835 | $1,766 | | Audit-Related Fees | $173 | $195 | | Tax Fees | $14 | $22 | | **Total Fees** | **$2,022** | **$1,983** | Part III [Financial Statements](index=104&type=section&id=Item%2018.%20Financial%20Statements) Contains the audited consolidated financial statements and the independent auditor's report for 2016-2018 - The independent auditor, KPMG LLP, issued an **unqualified opinion on the consolidated financial statements**, stating they present fairly the financial position of the company[614](index=614&type=chunk) - KPMG LLP issued an **adverse opinion on the company's internal control over financial reporting** as of December 31, 2018, due to a material weakness[619](index=619&type=chunk)[621](index=621&type=chunk) - Note 2 details an immaterial reclassification and adjustment of prior periods to present revenue and expenses for the managed fleet on a **'gross' basis instead of 'net'**, with no impact on net income[737](index=737&type=chunk)[738](index=738&type=chunk)[739](index=739&type=chunk) - Note 12 provides a detailed breakdown of the company's **$3.41 billion in debt obligations** as of December 31, 2018[778](index=778&type=chunk)