UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For The Quarterly Period Ended March 31, 2022

Or

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

For the Transition Period from                             to   

Commission file number - 001-37827

Triton International Limited

(Exact name of registrant as specified in the charter)

Bermuda						98-1276572
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)

Victoria Place, 5th Floor, 31 Victoria Street, Hamilton HM 10, Bermuda

(Address of principal executive office)

(441) 294-8033

(Registrant's telephone number including area code)

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

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common shares, $0.01 par value per share			TRTN			New York Stock Exchange
8.50% Series A Cumulative Redeemable Perpetual Preference Shares			TRTN PRA			New York Stock Exchange
8.00% Series B Cumulative Redeemable Perpetual Preference Shares			TRTN PRB			New York Stock Exchange
7.375% Series C Cumulative Redeemable Perpetual Preference Shares			TRTN PRC			New York Stock Exchange
6.875% Series D Cumulative Redeemable Perpetual Preference Shares			TRTN PRD			New York Stock Exchange
5.75% Series E Cumulative Redeemable Perpetual Preference Shares			TRTN PRE			New York Stock Exchange

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

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

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

Large Accelerated Filer

☒

Accelerated Filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

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

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

As of April 29, 2022, there were 64,213,200 common shares at $0.01 par value per share of the registrant outstanding.

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Triton International Limited

Index

						Page No.
Item 1.			Financial Statements (unaudited)			4
			Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021			4
			Consolidated Statements of Operations for the three months ended March 31, 2022 and 2021			5
			Consolidated Statements of Comprehensive Income for the three months ended March 31, 2022 and 2021			6
			Consolidated Statements of Equity for the three months ended March 31, 2022 and 2021			7
			Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021			8
			Notes to Consolidated Financial Statements			9
Item 2.			Management's Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3.			Quantitative and Qualitative Disclosures About Market Risk			31
Item 4.			Controls and Procedures			32
PART II—OTHER INFORMATION
Item 1.			Legal Proceedings			33
Item 1A.			Risk Factors			33
Item 2.			Unregistered Sales of Equity Securities and Use of Proceeds			33
Item 6.			Exhibits			34
Signature						35

2

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, that involve substantial risks and uncertainties. In addition, we, or our executive officers on our behalf, may from time to time make forward-looking statements in reports and other documents we file with the Securities and Exchange Commission, or SEC, or in connection with oral statements made to the press, potential investors or others. All statements, other than statements of historical facts, including statements regarding our strategy, future operations, future financial position, future revenues, future costs, prospects, plans and objectives of management are forward-looking statements. The words "expect," "estimate," "anticipate," "predict," "believe," "think," "plan," "will," "should," "intend," "seek," "potential" and similar expressions and variations are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

All forward-looking statements address matters that involve risks and uncertainties, many of which are beyond Triton's control. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements. These factors include, without limitation, economic, business, competitive, market and regulatory conditions and the following:

•the impact of COVID-19 on our business and financial results;

•decreases in the demand for leased containers;

•decreases in market leasing rates for containers;

•difficulties in re-leasing containers after their initial fixed-term leases;

•our customers' decisions to buy rather than lease containers;

•our dependence on a limited number of customers and suppliers;

•customer defaults;

•decreases in the selling prices of used containers;

•extensive competition in the container leasing industry;

•risks stemming from the international nature of our businesses, including global economic trends and geopolitical risks;

•decreases in demand for international trade;

•disruption to our operations resulting from the political and economic policies of the United States and other countries, particularly China, including but not limited to, the impact of trade wars, duties and tariffs;

•disruption to our operations from failures of, or attacks on, our information technology systems;

•disruption to our operations as a result of natural disasters;

•compliance with laws and regulations related to economic and trade sanctions, security, anti-terrorism, environmental protection and anti-corruption;

•the availability and cost of capital;

•restrictions imposed by the terms of our debt agreements;

•changes in tax laws in Bermuda, the United States and other countries; and

•other risks and uncertainties, including those listed under the caption "Risk Factors" in our Annual Report on Form 10-K, filed with the SEC on February 15, 2022 (the "Form 10-K"), in this Report on Form 10-Q and in any other Form 10-Q filed or to be filed by us, as well as in the other documents we file with the SEC from time to time, and such risks and uncertainties are specifically incorporated herein by reference.

Forward-looking statements speak only as of the date the statements are made. Except as required under the federal securities laws and rules and regulations of the SEC, we undertake no obligation to update or revise forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. We caution you not to unduly rely on the forward-looking statements when evaluating the information presented in this report.

3

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ITEM 1.    FINANCIAL STATEMENTS

TRITON INTERNATIONAL LIMITED

Consolidated Balance Sheets

(In thousands, except share data)

(Unaudited)

			March 31, 2022						December 31, 2021
ASSETS:
Leasing equipment, net of accumulated depreciation of $4,048,194 and $3,919,181			$	9,945,967					$	10,201,113
Net investment in finance leases			1,696,543						1,558,290
Equipment held for sale			79,061						48,746
Revenue earning assets			11,721,571						11,808,149
Cash and cash equivalents			71,969						106,168
Restricted cash			121,431						124,370
Accounts receivable, net of allowances of $1,144 and $1,178			293,442						294,792
Goodwill			236,665						236,665
Lease intangibles, net of accumulated amortization of $284,111 and $281,340			14,346						17,117
Other assets			38,989						50,346
Fair value of derivative instruments			36,401						6,231
Total assets			$	12,534,814					$	12,643,838
LIABILITIES AND SHAREHOLDERS' EQUITY:
Equipment purchases payable			$	56,804					$	429,568
Fair value of derivative instruments			2,906						48,277
Deferred revenue			90,417						92,198
Accounts payable and other accrued expenses			69,490						70,557
Net deferred income tax liability			387,211						376,009
Debt, net of unamortized costs of $65,069 and $63,794			8,727,432						8,562,517
Total liabilities			9,334,260						9,579,126
Shareholders' equity:
Preferred shares, $0.01 par value, at liquidation preference			730,000						730,000
Common shares, $0.01 par value, 270,000,000 shares authorized, 81,367,045 and 81,295,366 shares issued, respectively			814						813
Undesignated shares, $0.01 par value, 800,000 shares authorized, no shares issued and outstanding			—						—
Treasury shares, at cost, 16,686,873 and 15,429,499 shares, respectively			(602,526)						(522,360)
Additional paid-in capital			901,150						904,224
Accumulated earnings			2,139,777						2,000,854
Accumulated other comprehensive income (loss)			31,339						(48,819)
Total shareholders' equity			3,200,554						3,064,712
Total liabilities and shareholders' equity			$	12,534,814					$	12,643,838

The accompanying Notes to the Unaudited Consolidated Financial Statements are an integral part of these statements.

4

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TRITON INTERNATIONAL LIMITED

Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)

			Three Months Ended March 31,
			2022						2021
Leasing revenues:
Operating leases			$	388,945					$	339,794
Finance leases			28,143						6,949
Total leasing revenues			417,088						346,743
Equipment trading revenues			34,120						25,945
Equipment trading expenses			(29,979)						(17,804)
Trading margin			4,141						8,141
Net gain on sale of leasing equipment			28,969						21,967
Operating expenses:
Depreciation and amortization			160,716						143,307
Direct operating expenses			6,220						9,370
Administrative expenses			21,300						20,921
Provision (reversal) for doubtful accounts			(27)						(2,464)
Total operating expenses			188,209						171,134
Operating income (loss)			261,989						205,717
Other expenses:
Interest and debt expense			54,510						54,623
Unrealized (gain) loss on derivative instruments, net			(439)						—
Debt termination expense			36						—
Other (income) expense, net			(308)						(481)
Total other expenses			53,799						54,142
Income (loss) before income taxes			208,190						151,575
Income tax expense (benefit)			13,932						11,737
Net income (loss)			$	194,258					$	139,838
Less: dividend on preferred shares			13,028						10,513
Net income (loss) attributable to common shareholders			$	181,230					$	129,325
Net income per common share—Basic			$	2.79					$	1.93
Net income per common share—Diluted			$	2.78					$	1.92
Cash dividends paid per common share			$	0.65					$	0.57
Weighted average number of common shares outstanding—Basic			64,887						66,935
Dilutive restricted shares			267						282
Weighted average number of common shares outstanding—Diluted			65,154						67,217

   

The accompanying Notes to the Unaudited Consolidated Financial Statements are an integral part of these statements.

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TRITON INTERNATIONAL LIMITED

Consolidated Statements of Comprehensive Income

(In thousands)

(Unaudited)

			Three Months Ended March 31,
			2022						2021
Net income (loss)			$	194,258					$	139,838
Other comprehensive income (loss), net of tax:
Change in derivative instruments designated as cash flow hedges			74,017						62,850
Reclassification of (gain) loss on derivative instruments designated as cash flow hedges			6,307						7,102
Foreign currency translation adjustment			(166)						21
Other comprehensive income (loss), net of tax			80,158						69,973
Comprehensive income			274,416						209,811
Less:
Dividend on preferred shares			13,028						10,513
Comprehensive income attributable to common shareholders			$	261,388					$	199,298
Tax (benefit) provision on change in derivative instruments designated as cash flow hedges			$	5,546					$	2,558
Tax (benefit) provision on reclassification of (gain) loss on derivative instruments designated as cash flow hedges			$	463					$	468

   

The accompanying Notes to the Unaudited Consolidated Financial Statements are an integral part of these statements.

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TRITON INTERNATIONAL LIMITED

Consolidated Statements of Shareholders' Equity

(In thousands, except share amounts)

(Unaudited)

			Preferred Shares												Common Shares												Treasury Shares												Add'l Paid in Capital						Accumulated Earnings						Accumulated Other Comprehensive Income												Total Equity
			Shares						Amount						Shares						Amount						Shares						Amount
Balance as of December 31, 2021			29,200,000						$	730,000					81,295,366						$	813					15,429,499						$	(522,360)					$	904,224					$	2,000,854					$	(48,819)											$	3,064,712
Share-based compensation			—						—						164,932						2						—						—						2,554						—						—												2,556
Treasury shares acquired			—						—						—						—						1,257,374						(80,166)						—						—						—												(80,166)
Share repurchase to settle shareholder tax obligations			—						—						(93,253)						(1)						—						—						(5,628)						—						—												(5,629)
Net income (loss)			—						—						—						—						—						—						—						194,258						—												194,258
Other comprehensive income (loss)			—						—						—						—						—						—						—						—						80,158												80,158
Common shares dividend declared			—						—						—						—						—						—						—						(42,307)						—												(42,307)
Preferred shares dividend declared			—						—						—						—						—						—						—						(13,028)						—												(13,028)
Balance as of March 31, 2022			29,200,000						$	730,000					81,367,045						$	814					16,686,873						$	(602,526)					$	901,150					$	2,139,777					$	31,339											$	3,200,554

`			Preferred Shares												Common Shares												Treasury Shares												Add'l Paid in Capital						Accumulated Earnings						Accumulated Other Comprehensive Income												Total Equity
			Shares						Amount						Shares						Amount						Shares						Amount
Balance as of December 31, 2020			22,200,000						$	555,000					81,151,723						$	812					13,901,326						$	(436,822)					$	905,323					$	1,674,670					$	(133,035)											$	2,565,948
Share-based compensation			—						—						207,077						2						—						—						1,713						—						—												1,715
Share repurchase to settle shareholder tax obligations			—						—						(85,466)						(1)						—						—						(4,145)						—						—												(4,146)
Net income (loss)			—						—						—						—						—						—						—						139,838						—												139,838
Other comprehensive income (loss)			—						—						—						—						—						—						—						—						69,973												69,973
Common shares dividend declared			—						—						—						—						—						—						—						(38,497)						—												(38,497)
Preferred shares dividend declared			—						—						—						—						—						—						—						(10,513)						—												(10,513)
Balance as of March 31, 2021			22,200,000						$	555,000					81,273,334						$	813					13,901,326						$	(436,822)					$	902,891					$	1,765,498					$	(63,062)											$	2,724,318

The accompanying Notes to the Unaudited Consolidated Financial Statements are an integral part of these statements.

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TRITON INTERNATIONAL LIMITED

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

			Three Months Ended March 31,
			2022						2021
Cash flows from operating activities:
Net income (loss)			$	194,258					$	139,838
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization			160,716						143,307
Amortization of deferred debt cost and other debt related amortization			3,526						1,142
Lease related amortization			3,013						4,857
Share-based compensation expense			2,556						1,715
Net (gain) loss on sale of leasing equipment			(28,969)						(21,967)
Unrealized (gain) loss on derivative instruments			(439)						—
Debt termination expense			36						—
Deferred income taxes			5,193						11,615
Changes in operating assets and liabilities:
Accounts receivable			(23,835)						(20,300)
Deferred revenue			35,237						9,472
Accounts payable and other accrued expenses			4,143						1,886
Net equipment sold (purchased) for resale activity			(7,749)						1,579
Cash received (paid) for settlement of interest rate swaps			12,178						5,558
Cash collections on finance lease receivables, net of income earned			28,745						12,866
Other assets			10,061						9,420
Net cash provided by (used in) operating activities			398,670						300,988
Cash flows from investing activities:
Purchases of leasing equipment and investments in finance leases			(511,027)						(579,211)
Proceeds from sale of equipment, net of selling costs			57,274						53,512
Other			(135)						15
Net cash provided by (used in) investing activities			(453,888)						(525,684)
Cash flows from financing activities:
Purchases of treasury shares			(81,720)						—
Debt issuance costs			(5,507)						(13,803)
Borrowings under debt facilities			932,600						1,504,850
Payments under debt facilities and finance lease obligations			(766,686)						(979,199)
Dividends paid on preferred shares			(13,028)						(10,513)
Dividends paid on common shares			(41,950)						(38,153)
Other			(5,629)						(4,146)
Net cash provided by (used in) financing activities			18,080						459,036
Net increase (decrease) in cash, cash equivalents and restricted cash			$	(37,138)					$	234,340
Cash, cash equivalents and restricted cash, beginning of period			230,538						151,996
Cash, cash equivalents and restricted cash, end of period			$	193,400					$	386,336
Supplemental disclosures:
Interest paid			$	39,127					$	42,133
Income taxes paid (refunded)			$	137					$	155
Supplemental non-cash investing activities:
Equipment purchases payable			$	56,804					$	342,357

The accompanying Notes to the Unaudited Consolidated Financial Statements are an integral part of these statements.

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note 1—Description of the Business, Basis of Presentation and Accounting Policy Updates

Description of the Business

Triton International Limited ("Triton" or the "Company"), through its subsidiaries, leases intermodal transportation equipment, primarily maritime containers, and provides maritime container management services through a worldwide network of service subsidiaries, third-party depots and other facilities. The majority of the Company's business is derived from leasing its containers to shipping line customers through a variety of long-term and short-term contractual lease arrangements. The Company also sells containers from its equipment leasing fleet as well as containers specifically acquired for resale from third parties. The Company's registered office is located in Bermuda.

Basis of Presentation

The unaudited consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements do not include all information and footnotes required by GAAP for complete financial statements.

The interim consolidated balance sheet as of March 31, 2022; the consolidated statements of operations, the consolidated statements of comprehensive income, and the consolidated statements of shareholders' equity for the three months ended March 31, 2022 and 2021, and the consolidated statements of cash flows for the three months ended March 31, 2022 and 2021 are unaudited. The consolidated balance sheet as of December 31, 2021, included herein, was derived from the audited financial statements as of that date, but does not include all disclosures required by GAAP. The unaudited interim financial statements have been prepared on a basis consistent with the Company's annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary to state fairly the Company's financial position, results of operations, comprehensive income, shareholders' equity, and cash flows for the periods presented. The financial data and the other financial information disclosed in the notes to the financial statements related to these periods are also unaudited. The consolidated results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2022 or for any other future annual or interim period.

These financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto as of and for the year ended December 31, 2021 included in the Company's Annual Report on Form 10-K which was filed with the SEC on February 15, 2022. The unaudited consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Certain changes in presentation have been made to conform the prior period presentation to current period reporting.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities in the financial statements. Such estimates include, but are not limited to, the Company's estimates in connection with leasing equipment, including residual values and depreciable lives, values of assets held for sale and other long lived assets, provision for income tax, allowance for doubtful accounts, share-based compensation, goodwill and intangible assets. Actual results could differ from those estimates.

Concentration of Credit Risk

The Company's equipment leases and trade receivables subject it to potential credit risk. The Company extends credit to its customers based upon an evaluation of each customer's financial condition and credit history. Evaluations of the financial condition and associated credit risk of customers are performed on an ongoing basis. The Company's three largest customers accounted for 19%, 19%, and 10%, respectively, of the Company's lease billings during the three months ended March 31, 2022.

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Fair Value Measurements

For information on the fair value of equipment held for sale, debt, and the fair value of derivative instruments, please refer to Note 2 - "Equipment Held for Sale", Note 7 - "Debt" and Note 8 - "Derivative Instruments", respectively.

New Accounting Pronouncements

Recently Adopted Accounting Standards Updates

Lessors - Certain Leases with Variable Lease Payments

In July 2021, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2021-05, Lease (Topic 842): Lessors - Certain Leases with Variable Lease Payments. This guidance amends the lease classification accounting for lessors for certain leases with variable lease payments. The Company's adoption of this standard on January 1, 2022 had no impact on its consolidated financial statements.

Note 2—Equipment Held for Sale

The Company's equipment held for sale is recorded at the lower of fair value less cost to sell, or carrying value at the time identified for sale. Fair value is measured using Level 2 inputs and is based predominantly on recent sales prices. An impairment charge is recorded when the carrying value of the asset exceeds its fair value less cost to sell. The following table summarizes the Company's net impairment charges recorded in Net gain on sale of leasing equipment on the consolidated statements of operations (in thousands):

			Three Months Ended March 31,
			2022						2021
Impairment (loss) reversal on equipment held for sale			$	(73)					$	5
Gain (loss) on sale of equipment, net of selling costs			29,042						21,962
Net gain on sale of leasing equipment			$	28,969					$	21,967

Note 3—Intangible Assets

Intangible assets consist of lease intangibles for leases acquired with lease rates above market in a business combination. The following table summarizes the amortization of intangible assets as of March 31, 2022 (in thousands):

Years ending December 31,			Total Intangible Assets
2022			$	7,726
2023			4,657
2024			1,963
Total			$	14,346

Amortization expense related to intangible assets was $2.8 million and $4.6 million and for the three months ended March 31, 2022 and 2021, respectively.

Note 4—Share-Based Compensation

The Company recognizes share-based compensation expense for share-based payment transactions based on the grant date fair value. The expense is recognized over the employee's requisite service period, which is generally the vesting period of the equity award. The Company recognized share-based compensation expense in administrative expenses of $2.6 million and $1.7 million for the three months ended March 31, 2022 and 2021, respectively. Share-based compensation expense includes charges for performance-based shares and units that are deemed probable to vest.

As of March 31, 2022, the total unrecognized compensation expense related to non-vested restricted share awards and units was $17.6 million, which is expected to be recognized on a straight-line basis through January 2025.

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

During the three months ended March 31, 2022, the Company issued 212,062 restricted shares, and canceled 89,710 vested shares to settle payroll taxes on behalf of employees. Additional shares may be issued based upon the satisfaction of certain performance criteria. Additionally, the Company issued 9,527 shares to employees that vested immediately and canceled 3,543 vested shares to settle payroll taxes.

Note 5—Other Equity Matters

Share Repurchase Program

The Company's Board of Directors authorized repurchases of shares up to a specified dollar amount as part of its repurchase program. Purchases under the repurchase program may be made in the open market or privately negotiated transactions, and may include transactions pursuant to a repurchase plan administered in accordance with Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended. Purchases may be made from time to time at the Company's discretion and the timing and amount of any share repurchases will be determined based on share price, market conditions, legal requirements, and other factors. The repurchase program does not obligate the Company to acquire any particular amount of common shares, and the Company may suspend or discontinue the repurchase program at any time.

During the three months ended March 31, 2022, the Company repurchased a total of 1,257,374 common shares at an average price per-share of $63.74 for a total of $80.2 million.

Preferred Shares

The following table summarizes the Company's preferred share issuances (each, a "Series"):

Preferred Share Offering						Issuance									Liquidation Preference (in thousands)						# of Shares(1)
Series A 8.50% Cumulative Redeemable Perpetual Preference Shares ("Series A")						March 2019									$	86,250					3,450,000
Series B 8.00% Cumulative Redeemable Perpetual Preference Shares ("Series B")						June 2019									143,750						5,750,000
Series C 7.375% Cumulative Redeemable Perpetual Preference Shares ("Series C")						November 2019									175,000						7,000,000
Series D 6.875% Cumulative Redeemable Perpetual Preference Shares ("Series D")						January 2020									150,000						6,000,000
Series E 5.75% Cumulative Redeemable Perpetual Preference Shares ("Series E")						August 2021									175,000						7,000,000
															$	730,000					29,200,000

(1)     Represents number of shares authorized, issued, and outstanding.

Each Series of preferred shares may be redeemed at the Company's option, at any time after approximately five years from original issuance, in whole or in part at a redemption price, plus an amount equal to all accumulated and unpaid dividends, whether or not declared. The Company may also redeem each Series of preferred shares prior to the lapse of the five year period upon the occurrence of certain events as described in each instrument, such as transactions that either transfer ownership of substantially all assets to a single entity or establish a majority voting interest by a single entity, and cause a downgrade or withdrawal of rating by the rating agency within 60 days of the event. If the Company does not elect to redeem each Series upon the occurrence of the preceding events, holders of preferred shares may have the right to convert their preferred shares into common shares. Specifically for Series E only, the Company may redeem the Series E Preference Shares if an applicable rating agency changes the methodology or criteria that were employed in assigning equity credit to securities similar to the Series E Preference Shares when originally issued, which either (a) shortens the period of time during which equity credit pertaining to the Series E Preference Shares would have been in effect had the methodology not been changed or (b) reduces the amount of equity credit as compared with the amount of equity credit that the rating agency had assigned to the Series E Preference Shares when originally issued.

Holders of preferred shares generally have no voting rights. If the Company fails to pay dividends for six or more quarterly periods (whether or not consecutive), holders will be entitled to elect two additional directors to the Board of Directors and the size of the Board of Directors will be increased to accommodate such election. Such right to elect two directors will continue until such time as there are no accumulated and unpaid dividends in arrears.

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Dividends

Dividends on shares of each Series are cumulative from the date of original issue and will be payable quarterly in arrears on the 15th day of March, June, September and December of each year, when, as and if declared by the Company's Board of Directors. Dividends will be payable equal to the stated rate per annum of the $25.00 liquidation preference per share. The Series rank senior to the Company's common shares with respect to dividend rights and rights upon the Company's liquidation, dissolution or winding up, whether voluntary or involuntary.

The Company paid the following quarterly dividends during the three months ended March 31, 2022 and 2021 on its issued and outstanding Series (in millions except for the per-share amounts):

						Three Months Ended March 31,
						2022												2021
Series						Per Share Payment						Aggregate Payment						Per Share Payment						Aggregate Payment
A(1)						$0.53						$1.8						$0.53						$1.8
B						$0.50						$2.9						$0.50						$2.9
C(1)						$0.46						$3.2						$0.46						$3.2
D(1)						$0.43						$2.6						$0.43						$2.6
E(1)						$0.36						$2.5						$—						$—
Total												$13.0												$10.5

(1)     Per share payments rounded to the nearest whole cent.

As of March 31, 2022, the Company had cumulative unpaid preferred dividends of $2.2 million.

Common Share Dividends

The Company paid the following quarterly dividends during the three months ended March 31, 2022 and 2021 on its issued common shares (in millions except for the per-share amounts):

Three Months Ended March 31,
2022												2021
Per Share Payment						Aggregate Payment						Per Share Payment						Aggregate Payment
$0.65						$42.0						$0.57						$38.2

Accumulated Other Comprehensive Income

The following table summarizes the components of accumulated other comprehensive income (loss), net of tax, for the three months ended March 31, 2022 and 2021 (in thousands):

			Cash Flow Hedges						Foreign Currency Translation						Accumulated Other Comprehensive (Loss) Income
Balance as of December 31, 2021			$	(44,205)					$	(4,614)					$	(48,819)
Change in derivative instruments designated as cash flow hedges(1)			74,017						—						74,017
Reclassification of (gain) loss on derivative instruments designated as cash flow hedges(1)			6,307						—						6,307
Foreign currency translation adjustment			—						(166)						(166)
Balance as of March 31, 2022			$	36,119					$	(4,780)					$	31,339

12

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

			Cash Flow Hedges						Foreign Currency Translation						Accumulated Other Comprehensive (Loss) Income
Balance as of December 31, 2020			$	(128,526)					$	(4,509)					$	(133,035)
Change in derivative instruments designated as cash flow hedges(1)			62,850						—						62,850
Reclassification of (gain) loss on derivative instruments designated as cash flow hedges(1)			7,102						—						7,102
Foreign currency translation adjustment			—						21						21
Balance as of March 31, 2021			$	(58,574)					$	(4,488)					$	(63,062)

(1)    Refer to Note 8 - "Derivative Instruments" for reclassification impact on the Consolidated Statements of Operations

Note 6—Leases

Lessee

The Company's leases are primarily for multiple office facilities which are contracted under various cancelable and non-cancelable operating leases, most of which provide extension or early termination options. The Company's lease agreements do not contain any residual value guarantees or material restrictive covenants.

As of March 31, 2022, the weighted average implicit rate was 3.52% and the weighted average remaining lease term was 1.9 years.

The following table summarizes the impact of the Company's leases in its financial statements (in thousands):

Balance Sheet			Financial statement caption												March 31, 2022						December 31, 2021
Right-of-use asset - operating			Other assets												$	4,372					$	5,099
Lease liability - operating			Accounts payable and other accrued expenses												$	4,974					$	5,790

									Three Months Ended March 31,
Income Statement			Financial statement caption						2022						2021
Operating lease cost(1)			Administrative expenses						$	824					$	722

(1)     Includes short-term leases that are immaterial.

Cash paid for amounts of lease liabilities included in operating cash flows was $0.9 million and $0.7 million for the three months ended March 31, 2022 and March 31, 2021, respectively.

13

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Lessor

Operating Leases

As of March 31, 2022, the Company has deferred revenue balances related to operating leases with uneven payment terms. These amounts will be amortized to revenue as follows (in thousands):

Years ending December 31,
2022			$	4,934
2023			9,440
2024			11,946
2025			11,610
2026			11,005
2027 and thereafter			41,482
Total			$	90,417

Finance Leases

The following table summarizes the components of the net investment in finance leases (in thousands):

			March 31, 2022						December 31, 2021
Future minimum lease payment receivable(1)			$	2,292,614					$	2,122,165
Estimated residual receivable(2)			221,413						205,994
Gross finance lease receivables(3)			2,514,027						2,328,159
Unearned income(4)			(817,484)						(769,869)
Net investment in finance leases(5)			$	1,696,543					$	1,558,290

(1)     There were no executory costs included in gross finance lease receivables as of March 31, 2022 and December 31, 2021.

(2)     The Company's finance leases generally include a purchase option at nominal amounts that is reasonably certain to be exercised, and therefore, the Company has immaterial residual value risk for assets.

(3)    The gross finance lease receivable is reduced as billed to customers and reclassified to accounts receivable until paid by customers.

(4)     There were no unamortized initial direct costs as of March 31, 2022 and December 31, 2021.

(5)    One major customer represented 91% of the Company's finance lease portfolio for both March 31, 2022 and December 31, 2021. No other customer represented more than 10% of the Company's finance lease portfolio in each of those periods.

The Company’s finance lease portfolio lessees are primarily comprised of the largest international shipping lines. In its estimate of expected credit losses, the Company evaluates the overall credit quality of its finance lease portfolio. The Company considers an account past due when a payment has not been received in accordance with the terms of the related lease agreement and maintains allowances, if necessary, for doubtful accounts. These allowances are based on, but not limited to, historical experience which includes stronger and weaker economic cycles, each lessee's payment history, management's current assessment of each lessee's financial condition, consideration of current economic conditions and reasonable market forecasts. As of March 31, 2022, the Company does not have an allowance on its gross finance lease receivables and does not have any material past due balances.

14

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 7—Debt

The table below summarizes the Company's key terms and carrying value of debt (in thousands):

			March 31, 2022																					December 31, 2021
			Outstanding Borrowings			Contractual Weighted Avg Interest Rate(1)						Maturity Range(1)												Outstanding Borrowings
												From						To
Secured Debt Financings
Asset-backed securitization term notes			$	3,710,133		2.06%						August 2023						February 2031						$	3,801,777
Asset-backed securitization warehouse			202,000			2.30%						November 2027						November 2027						225,000
Finance lease obligations			—			4.93%						February 2022						February 2022						15,042
Total secured debt financings			3,912,133																					4,041,819
Unsecured Debt Financings
Senior notes			2,900,000			2.11%						August 2023						March 2032						2,300,000
Term loan facilities			1,152,000			1.84%						May 2026						May 2026						1,176,000
Revolving credit facilities			834,000			1.82%						October 2026						October 2026						1,112,000
Total unsecured debt financings			4,886,000																					4,588,000
Unamortized debt costs			(65,069)																					(63,794)
Unamortized debt premiums & discounts			(5,632)																					(3,508)
Debt, net of unamortized costs			$	8,727,432																				$	8,562,517

(1)     Data as of March 31, 2022.

The fair value of total debt outstanding was $8,333.3 million and $8,572.9 million as of March 31, 2022 and December 31, 2021, respectively, and was measured using Level 2 inputs.

As of March 31, 2022, the maximum borrowing levels for the Asset-backed Securitization ("ABS") warehouse and the revolving credit facilities are $1,125.0 million and $2,000.0 million, respectively. These facilities are governed by either borrowing bases or an unencumbered asset test that limits borrowing capacity. As of March 31, 2022, the availability under these credit facilities without adding additional assets to the borrowing base was approximately $1,095.3 million.

The Company is subject to certain financial covenants under its debt agreements. As of March 31, 2022 and December 31, 2021, the Company was in compliance with all financial covenants in accordance with the terms of its debt agreements.

The Company hedges the risks associated with fluctuations in interest rates on a portion of its floating-rate debt by entering into interest rate swap agreements that convert a portion of its floating-rate debt to a fixed rate basis, thus reducing the impact of interest rate changes on future interest expense. The following table summarizes the Company's outstanding fixed-rate and floating-rate debt as of March 31, 2022 (in thousands):

			Balance Outstanding						Contractual Weighted Avg Interest Rate						Maturity Range												Weighted Avg Remaining Term
															From						To
Excluding impact of derivative instruments:
Fixed-rate debt			$6,021,715						2.08%						Aug 2023						Mar 2032						5.1 years
Floating-rate debt			$2,776,418						1.93%						Aug 2023						Nov 2027						3.6 years
Including impact of derivative instruments:
Fixed-rate debt			$6,021,715						2.08%
Hedged floating-rate debt			$1,617,355						3.46%
Total fixed and hedged debt			$7,639,070						2.37%
Unhedged floating-rate debt			$1,159,063						1.93%
Total			$8,798,133						2.31%

15

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

On January 19, 2022, the Company completed a $600.0 million 3.25% senior notes offering with a maturity date of March 15, 2032.

On February 1, 2022, the Company exercised an early buyout option and paid $14.9 million of its remaining finance lease obligations.

Asset-Backed Securitization Term Notes

Under the Company's ABS facilities, indirect wholly-owned subsidiaries of the Company issue ABS notes. These subsidiaries are intended to be bankruptcy remote so that such assets are not available to creditors of the Company or its affiliates until and unless the related secured borrowings have been fully discharged. These transactions do not meet accounting requirements for sales treatment and are recorded as secured borrowings.

The Company’s borrowings under the ABS facilities amortize in monthly installments, typically in level payments over five or more years. These facilities provide for an advance rate against the net book values of designated eligible equipment. The net book values for purposes of calculating eligible equipment is determined according to the related debt agreement and may be different than those calculated per U.S. GAAP. The Company is required to maintain restricted cash balances on deposit in designated bank accounts equal to three to nine months of interest expense depending on the terms of each facility.

Asset-Backed Securitization Warehouse

Under the Company’s ABS warehouse facility, an indirect wholly-owned subsidiary of the Company issues ABS notes. This subsidiary is intended to be bankruptcy remote so that such assets are not available to creditors of the Company or its affiliates until and unless the related secured borrowings have been fully discharged. These transactions do not meet accounting requirements for sales treatment and are recorded as secured borrowings.

The Company's ABS warehouse facility has a borrowing capacity of $1,125.0 million that is available on a revolving basis until November 13, 2023, paying interest at the London Interbank Offered Rate ("LIBOR") plus 1.85% after which any borrowings will convert to term notes with a maturity date of November 15, 2027, paying interest at LIBOR plus 2.85%.

During the revolving period, the borrowing capacity under this facility is determined by applying an advance rate against the net book values of designated eligible equipment. The net book values for purposes of calculating eligible equipment are determined according to the related debt agreement and may be different than those calculated per U.S. GAAP. The Company is required to maintain restricted cash balances on deposit in designated bank accounts equal to three months of interest expense.

Senior Notes

The Company’s senior notes are unsecured and have maturities ranging from 1 - 10 years and interest payments due semi-annually. The senior notes are pre-payable (in whole or in part) at the Company's option at any time prior to the maturity date, subject to certain provisions in the senior note agreements, including the payment of a make-whole premium in respect to such prepayment.

Term Loan Facility

The Company's term loan facility has a maturity date of May 27, 2026, which amortizes in quarterly installments. This facility is subject to covenants customary for unsecured financings of this type, primarily financial covenants that require us to maintain a maximum ratio of unencumbered assets to certain financial indebtedness.

Revolving Credit Facility

The revolving credit facility has a maturity date of October 14, 2026, and has a maximum borrowing capacity of $2,000.0 million. This facility is subject to covenants customary for unsecured financings of this type, primarily financial covenants that require us to maintain a maximum ratio of unencumbered assets to certain financial indebtedness.

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 8—Derivative Instruments

Interest Rate Swaps / Caps

The Company enters into derivative agreements to manage interest rate risk exposure. Interest rate swap agreements are utilized to limit the Company's exposure to interest rate risk by converting a portion of its floating-rate debt to a fixed rate basis, thus reducing the impact of interest rate changes on future interest expense. Interest rate swaps involve the receipt of floating-rate amounts in exchange for fixed-rate interest payments over the lives of the agreements without an exchange of the underlying principal amounts. The Company also utilizes interest rate cap agreements to manage the Company's exposure to rising interest rates by placing a ceiling on the rate that will be paid under certain floating-rate debt agreements.

The counterparties to these agreements are highly rated financial institutions. In the unlikely event that the counterparties fail to meet the terms of these agreements, the Company's exposure is limited to the interest rate differential on the notional amount at each monthly settlement period over the life of the agreements. The Company does not anticipate any non-performance by the counterparties.

Certain assets of the Company's subsidiaries are pledged as collateral for various ABS facilities and the amounts payable under certain derivative agreements. Additionally, the Company may be required to post cash collateral on certain derivative agreements if the fair value of these contracts represents a liability. Any amounts of cash collateral posted are included in Other assets on the consolidated balance sheet and are presented in operating activities of the consolidated statements of cash flows. As of March 31, 2022, the Company posted cash collateral of $9.4 million related to interest rate swap contracts.

During the first quarter of 2022, the company terminated the following interest rate swaps:

Derivative Instrument

Date Terminated

Notional Amount

Funds Received (Paid)

Interest rate swap

January 11, 2022

$150.0 million

$6.0 million

Interest rate swap

January 11, 2022

$150.0 million

$6.1 million

As of March 31, 2022, the Company had interest rate swap and cap agreements in place to fix or limit the floating interest rates on a portion of the borrowings under its debt facilities summarized below:

Derivatives

Notional Amount

Weighted Average Fixed Leg (Pay) Interest Rate

Cap Rate

Weighted Average Remaining Term

Interest Rate Swap(1)

$1,617.4 Million

2.04%

n/a

4.0 years

Interest Rate Cap

$400.0 Million

n/a

5.5%

1.7 years

(1)     Excludes certain interest rate swaps with an effective date in a future period ("forward starting swaps"). Including these instruments will increase total notional amount by $350.0 million and increase the weighted average remaining term to 5.0 years.

Within the next twelve months, we expect to reclassify $0.2 million of net unrealized gains related to interest rate swap and cap agreements from accumulated other comprehensive income (loss) into earnings.

The following table summarizes the impact of derivative instruments on the consolidated statements of operations and the consolidated statements of comprehensive income on a pretax basis (in thousands):

									Three Months Ended March 31,
			Financial statement caption						2022						2021
Non-Designated Derivative Instruments
Unrealized (gains) losses			Unrealized (gain) loss on derivative instruments, net						$	(439)					$	—
Designated Derivative Instruments
Realized (gains) losses			Interest and debt (income) expense						$	6,770					$	7,570
Unrealized (gains) losses			Comprehensive (income) loss						$	(79,563)					$	(65,408)

Fair Value of Derivative Instruments

The Company has elected to use the income approach to value its interest rate swap and cap agreements, using Level 2 market expectations at the measurement date and standard valuation techniques to convert future values to a single discounted present value. The Level 2 inputs for the interest rate swap and cap valuations are inputs other than quoted prices that are

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

observable for the asset or liability (specifically LIBOR and swap rates and credit risk at commonly quoted intervals). In response to the expected phase out of LIBOR, the Company continues to work with its counterparties to identify an alternative reference rate. Substantially all of the Company's debt agreements already include transition language, and the Company also adopted various practical expedients which will facilitate the transition.

The Company presents the fair value of derivative financial instruments on a gross basis as a separate line item on the consolidated balance sheet. As of March 31, 2022 and December 31, 2021, the Company has no material non-designated instruments.

Note 9—Segment and Geographic Information

Segment Information

The Company operates its business in one industry, intermodal transportation equipment, and has two operating segments which also represent its reporting segments:

•Equipment leasing - the Company owns, leases and ultimately disposes of containers and chassis from its lease fleet.

•Equipment trading - the Company purchases containers from shipping line customers, and other sellers of containers, and resells these containers to container retailers and users of containers for storage or one-way shipment. Included in the equipment trading segment revenues are leasing revenues from equipment purchased for resale that is currently on lease until the containers are dropped off.

These operating segments were determined based on the chief operating decision maker's review and resource allocation of the products and services offered.

The following tables summarizes our segment information and the consolidated totals reported (in thousands):

			Three Months Ended March 31,
			2022																		2021
			Equipment Leasing						Equipment Trading						Totals						Equipment Leasing						Equipment Trading						Totals
Total leasing revenues			$	413,691					$	3,397					$	417,088					$	343,805					$	2,938					$	346,743
Trading margin			—						4,141						4,141						—						8,141						8,141
Net gain on sale of leasing equipment			28,969						—						28,969						21,967						—						21,967
Depreciation and amortization expense			160,532						184						160,716						143,137						170						143,307
Interest and debt expense			54,251						259						54,510						54,221						402						54,623
Segment income (loss) before income taxes(1)			201,141						6,646						207,787						142,189						9,386						151,575
Purchases of leasing equipment and investments in finance leases(2)			$	511,027					$	—					$	511,027					$	579,211					$	—					$	579,211

(1)    Segment income before income taxes excludes unrealized gains or losses on derivative instruments and debt termination expense. For the three months ended March 31, 2022, the Company recorded an unrealized gain of $0.4 million and an immaterial amount of debt termination expense. For the three months ended March 31, 2021, the Company did not record any unrealized gain or debt termination expense.

(2)     Represents cash disbursements for purchases of leasing equipment and investments in finance lease as reflected in the consolidated statements of cash flows for the periods indicated, but excludes cash flows associated with the purchase of equipment held for resale.

			March 31, 2022																		December 31, 2021
			Equipment Leasing						Equipment Trading						Totals						Equipment Leasing						Equipment Trading						Totals
Equipment held for sale			$	26,014					$	53,047					$	79,061					$	16,936					$	31,810					$	48,746
Goodwill			220,864						15,801						236,665						220,864						15,801						236,665
Total assets			$	12,416,317					$	118,497					$	12,534,814					$	12,543,270					$	100,568					$	12,643,838

There are no intercompany revenues or expenses between segments. Certain administrative expenses have been allocated between segments based on an estimate of services provided to each segment. A portion of the Company's equipment purchased for resale in the equipment trading segment may be leased for a period of time and is reflected as leasing equipment as opposed to equipment held for sale and the cash flows associated with these transactions are reflected as purchases of leasing equipment and proceeds from the sale of equipment in investing activities in the Company's consolidated statements of cash flows.

18

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Geographic Segment Information

The Company generates the majority of its leasing revenues from international containers which are deployed by its customers in a wide variety of global trade routes. The majority of the Company's leasing related revenue is denominated in U.S. dollars.

The following table summarizes the geographic allocation of total leasing revenues for the three months ended March 31, 2022 and 2021 based on customers' primary domicile (in thousands):

			Three Months Ended March 31,
			2022						2021
Total leasing revenues:
Asia			$	149,986					$	123,894
Europe			220,106						186,373
Americas			34,209						24,713
Bermuda			630						575
Other International			12,157						11,188
Total			$	417,088					$	346,743

Since the majority of the Company's containers are used internationally, where no one container is domiciled in one particular place for a prolonged period of time, all of the Company's long-lived assets are considered to be international.

The following table summarizes the geographic allocation of equipment trading revenues for the three months ended March 31, 2022 and 2021 based on the location of the sale (in thousands):

			Three Months Ended March 31,
			2022						2021
Total equipment trading revenues:
Asia			$	13,908					$	7,459
Europe			8,962						7,122
Americas			10,187						8,541
Bermuda			—						—
Other International			1,063						2,823
Total			$	34,120					$	25,945

Note 10—Commitments and Contingencies

Container Equipment Purchase Commitments

At March 31, 2022, the Company had commitments to purchase equipment in the amount of $259.5 million to be paid in 2022.

Contingencies

The Company is party to various pending or threatened legal or regulatory proceedings arising in the ordinary course of its business. Based upon information presently available, the Company does not expect any liabilities arising from these matters to have a material effect on the consolidated financial position, results of operations or cash flows of the Company.

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TRITON INTERNATIONAL LIMITED

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Note 11—Income Taxes

The Company's effective tax rates were 6.7% and 7.7% for the three months ended March 31, 2022 and 2021, respectively. The Company has computed the provision for income taxes based on the estimated annual effective tax rate and the application of discrete items, if any, in the applicable period. The decrease in the effective tax rates for the three months ended March 31, 2022 compared to the same period in 2021 was primarily due to an increased portion of the Company's income generated in lower tax jurisdictions.

Note 12—Related Party Transactions

The Company holds a 50% interest in TriStar Container Services (Asia) Private Limited ("TriStar"), which is primarily engaged in the selling and leasing of container equipment in the domestic and short sea markets in India.  The Company's equity investment in TriStar is included in Other assets on the consolidated balance sheet. The Company received payments on finance leases with TriStar of $0.5 million for both the three months ended March 31, 2022 and March 31, 2021. The Company has a direct finance lease balance with TriStar of $8.5 million and $8.9 million as of March 31, 2022 and December 31, 2021, respectively.

Note 13—Subsequent Events

On April 26, 2022, the Company's Board of Directors approved and declared a quarterly cash dividend of $0.65 per share on its issued and outstanding common shares, payable on June 23, 2022 to holders of record at the close of business on June 9, 2022.

On April 26, 2022, the Company's Board of Directors also approved and declared a cash dividend on its issued and outstanding preferred shares, payable on June 15, 2022 to holders of record at the close of business on June 8, 2022 as follows:

Preferred Share Offering						Dividend Rate						Dividend Per Share
Series A						8.500%						$0.5312500
Series B						8.000%						$0.5000000
Series C						7.375%						$0.4609375
Series D						6.875%						$0.4296875
Series E						5.750%						$0.3593750

On April 26, 2022, the Company's Board of Directors increased the share repurchase authorization to $200.0 million. The revised authorization may be used by the Company to repurchase common or preferred shares.

On April 27, 2022, the Company amended its existing ABS warehouse facility with $1,125.0 million borrowing capacity which extended the revolving period to April 27, 2025 and changed the interest rate to the secured overnight financing rate ("SOFR") plus 1.60%. After the revolving period, borrowings will convert to term notes with a maturity date of April 27, 2029, paying interest at SOFR plus 2.60%.

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The statements in this discussion regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and other non-historical statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described under "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements" as discussed in our Annual Report on Form 10-K filed for the fiscal year ended December 31, 2021 with the SEC on February 15, 2022 (the "Form 10-K"), in this Report on Form 10-Q and in any other Form 10-Q filed or to be filed by us, and in other documents we file with the SEC from time to time. Our actual results may differ materially from those contained in or implied by any forward-looking statements.

Our Company

Triton International Limited ("Triton", "we", "our" or the "Company") is the world's largest lessor of intermodal containers. Intermodal containers are large, standardized steel boxes used to transport freight by ship, rail or truck. Because of the handling efficiencies they provide, intermodal containers are the primary means by which many goods and materials are shipped internationally. We also lease chassis, which are used for the transportation of containers.

We operate our business in one industry, intermodal transportation equipment, and have two business segments, which also represent our reporting segments:

•Equipment leasing - we own, lease and ultimately dispose of containers and chassis from our lease fleet.

•Equipment trading - we purchase containers from shipping line customers, and other sellers of containers, and resell these containers to container retailers and users of containers for storage or one-way shipment.

Operations

Our consolidated operations include the acquisition, leasing, re-leasing and subsequent sale of multiple types of intermodal containers and chassis. As of March 31, 2022, our total fleet consisted of 4.3 million containers and chassis, representing 7.3 million twenty-foot equivalent units ("TEU") or 8.0 million cost equivalent units ("CEU"). We have an extensive global presence, offering leasing services through 20 offices and 3 independent agencies located in 16 countries and 380 third-party owned and operated depot facilities in 46 countries as of March 31, 2022. Our primary customers include the world's largest container shipping lines. For the three months ended March 31, 2022, our twenty largest customers accounted for 85% of our lease billings, our five largest customers accounted for 61% of our lease billings, and our three largest customers accounted for 19%, 19%, and 10% of our lease billings.

The most important driver of profitability in our business is the extent to which leasing revenues, which are driven by our owned equipment fleet size, utilization and average lease rates, exceed our ownership and operating costs. Our profitability is also driven by the gains or losses we realize on the sale of used containers and the margins generated from trading new and used containers.

We lease five types of equipment: (1) dry containers, which are used for general cargo such as manufactured component parts, consumer staples, electronics and apparel, (2) refrigerated containers, which are used for perishable items such as fresh and frozen foods, (3) special containers, which are used for heavy and over-sized cargo such as marble slabs, building products and machinery, (4) tank containers, which are used to transport bulk liquid products such as chemicals, and (5) chassis, which are used for the transportation of containers on the road. Our in-house equipment sales group manages the sale process for our used containers and chassis from our equipment leasing fleet and sells used and new containers and chassis acquired from third parties.

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The following tables summarize our equipment fleet as of March 31, 2022, December 31, 2021 and March 31, 2021 indicated in units, TEU and CEU. CEU and TEU are standard industry measures of fleet size and are used to measure the quantity of containers that make up our revenue earning assets:

			Equipment Fleet in Units																		Equipment Fleet in TEU
			March 31, 2022						December 31, 2021						March 31, 2021						March 31, 2022						December 31, 2021						March 31, 2021
Dry			3,850,167						3,843,719						3,417,293						6,546,249						6,531,816						5,711,032
Refrigerated			234,274						235,338						232,550						455,261						457,172						450,087
Special			92,184						92,411						94,266						168,687						169,004						171,781
Tank			11,734						11,692						11,339						11,734						11,692						11,339
Chassis			23,711						24,139						24,078						44,272						44,554						43,858
Equipment leasing fleet			4,212,070						4,207,299						3,779,526						7,226,203						7,214,238						6,388,097
Equipment trading fleet			56,161						53,204						60,242						90,090						83,692						93,514
Total			4,268,231						4,260,503						3,839,768						7,316,293						7,297,930						6,481,611

			Equipment Fleet in CEU (1)
			March 31, 2022						December 31, 2021						March 31, 2021
Operating leases			7,250,246						7,291,769						6,892,129
Finance leases			666,690						623,136						297,168
Equipment trading fleet			85,686						81,136						92,570
Total			8,002,622						7,996,041						7,281,867

(1)In the equipment fleet tables above, we have included total fleet count information based on CEU. CEU is a ratio used to convert the actual number of containers in our fleet to a figure based on an estimate for the historical average relative purchase prices of our various equipment types to that of a 20-foot dry container. For example, the CEU ratio for a 40-foot high cube dry container is 1.70, and a 40-foot high cube refrigerated container is 7.50. These factors may differ slightly from CEU ratios used by others in the industry.

The following table summarizes the percentage of our equipment fleet in terms of units and CEU as of March 31, 2022:

Equipment Type			Percentage of total fleet in units						Percentage of total fleet in CEU
Dry			90.2		%				71.4		%
Refrigerated			5.4						21.7
Special			2.2						3.0
Tank			0.3						1.2
Chassis			0.6						1.6
Equipment leasing fleet			98.7						98.9
Equipment trading fleet			1.3						1.1
Total			100.0		%				100.0		%

We generally lease our equipment on a per diem basis to our customers under three types of leases:

•Long-term leases typically have initial contractual terms ranging from five to eight or more years and provide us with stable cash flow and low transaction costs by requiring customers to maintain specific units on-hire for the duration of the lease term. Some of our containers, primarily used containers, are placed on lifecycle leases which keep the containers on-hire until the end of their useful life.

•Finance leases are typically structured as full payout leases and provide for a predictable recurring revenue stream with the lowest cost to the customer as customers are generally required to retain the equipment for the duration of its useful life.

•Service leases command a premium per diem rate in exchange for providing customers with greater operational flexibility by allowing non-scheduled pick-up and drop-off of units during the lease term.

We also have expired long-term leases whose fixed terms have ended but for which the related units remain on-hire and for which we continue to receive rental payments pursuant to the terms of the initial contract. Some leases have contractual terms that have features reflective of both long-term and service leases and we classify such leases as either long-term or service leases, depending upon which features we believe are predominant.

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The following table summarizes our lease portfolio by lease type, based on CEU on-hire as of March 31, 2022, December 31, 2021 and March 31, 2021:

Lease Portfolio by CEU			March 31, 2022						December 31, 2021						March 31, 2021
Long-term leases			72.4		%				72.4		%				74.7		%
Finance leases			8.6		%				8.0		%				4.2		%
Subtotal			81.0		%				80.4		%				78.9		%
Service leases			5.0		%				5.0		%				6.4		%
Expired long-term leases, non-sale age (units on hire)			6.9		%				8.4		%				9.0		%
Expired long-term leases, sale-age (units on hire)			7.1		%				6.2		%				5.7		%
Total			100.0		%				100.0		%				100.0		%
Weighted average remaining contractual term in months for long-term and finance leases			61						61						51

Due to our aggressive fleet investment in 2021 and the high cost of these new containers, we placed the vast majority of this equipment on long-term operating and finance leases with an average initial duration of 13 years. To better reflect the impact of these dynamics on our lease portfolio, we have included the following equipment lease portfolio table based on net book value of units on-hire, as of March 31, 2022, December 31, 2021 and March 31, 2021:

Lease Portfolio by Net Book Value			March 31, 2022						December 31, 2021						March 31, 2021
Long-term leases			73.0		%				73.6		%				80.8		%
Finance leases			15.0		%				13.8		%				3.0		%
Subtotal			88.0		%				87.4		%				83.8		%
Service leases			3.7		%				3.5		%				5.4		%
Expired long-term leases, non-sale age (units on hire)			4.9		%				6.2		%				7.8		%
Expired long-term leases, sale-age (units on hire)			3.4		%				2.9		%				3.0		%
Total			100.0		%				100.0		%				100.0		%
Weighted average remaining contractual term in months for long-term and finance leases			79						78						58

Operating Performance

Our operating and financial performance in the first quarter of 2022 was strong and our profitability increased sharply compared to the first quarter of 2021. In the first quarter, we continued    to benefit from constructive market conditions along with the significant operating and financial momentum provided from our aggressive investing and refinancing activity in 2021.

Fleet size. As of March 31, 2022, the net book value of our revenue earning assets was $11.7 billion, an increase of 23.0% compared to March 31, 2021 and a decrease of 0.7% compared to December 31, 2021. The increase from last year was primarily due to our $3.6 billion of fleet investment in 2021 to support our customers' sizable demand for new containers as a result of a surge in global containerized trade volumes and operational disruptions creating a shortage of containers. The dollar value of our investments was also driven by very high new container prices. In 2022, our investment in new equipment has been more limited following the rapid growth in the container fleet last year. As of April 29, 2022, we have placed orders for $428.1 million of new containers for delivery in 2022.

Utilization. Our average utilization was 99.6% for the quarter ended March 31, 2022, an increase of 0.5% compared to the first quarter of 2021 and flat compared to the fourth quarter of 2021. Our utilization increased steadily during 2021 as we benefited from a very high volume of container pick-ups driven by the aggressive investment in new containers, combined with limited drop-off activity. Our ending utilization as of March 31, 2022 was 99.5% and currently remains at this level.

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The following tables summarize our equipment fleet utilization for the periods indicated below. Utilization is computed by dividing our total units on lease (in CEU) by the total units in our fleet (in CEU), excluding new units not yet leased and off-hire units designated for sale:

			Quarter Ended
			March 31, 2022						December 31, 2021						September 30, 2021						June 30, 2021						March 31, 2021
Average Utilization			99.6		%				99.6		%				99.6		%				99.4		%				99.1		%
Ending Utilization			99.5		%				99.6		%				99.6		%				99.5		%				99.3		%

Average lease rates. Average lease rates for our dry container product line increased by 9.0% in the first quarter of 2022 compared to the first quarter of 2021. The increase in our average dry container lease rates was primarily driven by the addition of new containers with lease rates well above the average rates in our lease portfolio. New container prices and market lease rates were very high throughout 2021 due to the surge in container demand and limited availability of containers. Container prices have decreased from their peak level of nearly $3,900 for a new 20' dry container reached in the third quarter last year, but remain historically high with factories currently quoting just below $3,000. Similarly, market leasing rates are down from their peak level in 2021, but also remain historically high and well above our portfolio average.

Average lease rates for our refrigerated container product line decreased by 3.7% in the first quarter of 2022 compared to the first quarter of 2021. In 2021, we completed a large lease extension transaction for refrigerated containers that lowered the lease rates on expired leases in return for a lease extension covering the remaining useful life of the equipment. We have also been experiencing larger differences in lease rates for older refrigerated containers compared to rates on new equipment, and we expect our average lease rates for refrigerated containers will continue to gradually trend down.

The average lease rates for special containers decreased by 0.9% in the first quarter of 2022 compared to the first quarter of 2021 primarily due to a lease extension transaction for a large number of special containers completed in 2021.

Interest and Debt Expense.    Our average debt balance increased by $2.1 billion, compared to the first quarter of 2021, as we increased borrowings to support the significant growth in our revenue earning assets. Despite an increase in our average debt balance, our interest expense was essentially flat compared to the first quarter of 2021 reflecting a 0.80% decrease in our effective interest rate to 2.50%. This decrease was driven by our extensive refinancing activity over the last two years as we took advantage of the low interest rate environment and the upgrade of our corporate credit ratings to investment grade. The recent rise in interest rates may lead to an increase in our effective interest rate; however, we remain mostly insulated, as 87% of our debt portfolio is comprised of either fixed rate debt or hedged floating-rate debt as of March 31, 2022.

Equipment disposals. Disposal gains continue to be extraordinarily high reflecting historically high used container sale prices. During 2021, the strong demand for containers, record high prices for new containers, and limited availability of used containers for sale drove used container sales prices to record levels. In the first quarter of 2022, selling prices decreased slightly from their peak levels in 2021, although they remained historically high due to continued high new container prices, lingering logistical bottlenecks, low container drop-off volumes and limited availability of used containers. We expect used container sales prices will likely normalize further over the course of 2022, and consequently our disposal gains are also likely to decrease from the first quarter levels.

Liquidity and Capital Resources

Our principal sources of liquidity are cash flows provided by operating activities, proceeds from the sale of our leasing equipment, borrowings under our credit facilities and proceeds from other financing activities. Our principal uses of cash include capital expenditures, debt service, dividends, and share repurchases.

For the trailing twelve months ended March 31, 2022, cash provided by operating activities, together with the proceeds from the sale of our leasing equipment, was $1,723.7 million. In addition, as of March 31, 2022, we had $72.0 million of unrestricted cash and cash equivalents and $2,089.0 million of borrowing capacity remaining under our existing credit facilities.

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As of March 31, 2022, our cash commitments in the next twelve months include $463.0 million of scheduled principal payments on our existing debt facilities and $316.3 million of committed but unpaid capital expenditures, primarily for the purchase of equipment.

We believe that cash provided by operating activities, existing cash, proceeds from the sale of our leasing equipment, and availability under our credit facilities will be sufficient to meet our obligations over the next twelve months and beyond.

Capital Activity

During the three months ended March 31, 2022 the Company paid dividends of $13.0 million and $42.0 million on preferred shares and common shares, respectively.

During the three months ended March 31, 2022, the Company repurchased a total of 1.3 million common shares at an average price per share of $63.74 for a total cost of $80.2 million under its share repurchase program.

For additional information, please refer to Note 5 - “Other Equity Matters” in the Notes to the Unaudited Consolidated Financial Statements.

Debt Activity

During the first quarter, the Company completed a $600.0 million 3.25% senior notes offering with a maturity date of March 15, 2032. In addition, the Company exercised an early buyout option and paid $14.9 million of its remaining finance lease obligation.

Credit Ratings

Our investment-grade corporate and long-term debt credit ratings enable us to lower our cost of funds and broaden our access to attractively priced capital. While a ratings downgrade would not result in a default under any of our debt agreements, it could adversely affect our ability to issue debt and obtain new financings, or renew existing financings, and it would increase the cost of our financings. The Company's long-term debt and corporate ratings of BBB- from both S&P Global Ratings and Fitch Ratings have not changed since December 31, 2021.

Debt Agreements

At March 31, 2022 our outstanding indebtedness was comprised of the following (amounts in millions):

			March 31, 2022
			Outstanding Borrowings						Maximum Borrowing Level
Secured Debt Financings
Asset-backed securitization term notes			$	3,710.1					$	3,710.1
Asset-backed securitization warehouse			202.0						1,125.0
Total secured debt financings			3,912.1						4,835.1
Unsecured Debt Financings
Senior notes			2,900.0						2,900.0
Term loan facilities			1,152.0						1,152.0
Revolving credit facilities			834.0						2,000.0
Total unsecured debt financings			4,886.0						6,052.0
Unamortized debt costs			(65.1)						—
Unamortized debt premiums & discounts			(5.6)						—
Debt, net of unamortized costs			$	8,727.4					$	10,887.1

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The maximum borrowing levels depicted in the table above may not reflect the actual availability under all of the credit facilities. Certain of these facilities are governed by either borrowing bases or an unencumbered asset test that limits borrowing capacity. As of March 31, 2022, the availability under these credit facilities without adding additional assets was $1,095.3 million.

As of March 31, 2022, we had a combined $7,639.1 million of total debt on facilities with fixed interest rates or floating interest rates that have been synthetically fixed through interest rate swap contracts. This accounts for 87% of total debt.

Pursuant to the terms of certain debt agreements, we are required to maintain certain amounts in restricted cash accounts. As of March 31, 2022, we had restricted cash of $121.4 million.

For additional information on our debt, please refer to Note 7 - "Debt" in the Notes to the Unaudited Consolidated Financial Statements.

Debt Covenants

We are subject to certain financial covenants related to leverage and interest coverage as defined in our debt agreements. Failure to comply with these covenants could result in a default under the related credit agreements and the acceleration of our outstanding debt if we were unable to obtain a waiver from the creditors. As of March 31, 2022, we were in compliance with all such covenants.

Cash Flow

The following table sets forth certain cash flow information for the three months ended March 31, 2022 and 2021 (in thousands):

			Three Months Ended March 31,
			2022						2021
Net cash provided by (used in) operating activities			$	398,670					$	300,988
Net cash provided by (used in) investing activities			$	(453,888)					$	(525,684)
Net cash provided by (used in) financing activities			$	18,080					$	459,036

Operating Activities

Net cash provided by operating activities increased by $97.7 million to $398.7 million in the three months ended March 31, 2022 compared to $301.0 million in the same period in 2021, primarily due to increased profitability. In addition, there was an increase in cash collections related to leases with uneven payment terms and an increase in cash collections on finance leases due to an increase in our finance lease portfolio.

Investing Activities

Net cash used in investing activities was $453.9 million in the three months ended March 31, 2022 compared to $525.7 million in the same period in 2021. The change was primarily due to a $68.2 million decrease in equipment purchases.

Financing Activities

Net cash provided by financing activities was $18.1 million in the three months ended March 31, 2022, compared to $459.0 million in the same period in 2021. The change was primarily due to a $359.7 million decrease in net borrowings. In addition, we paid $81.7 million for share repurchases in the first quarter of 2022.

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Results of Operations

The following table summarizes our comparative results of operations for the three months ended March 31, 2022 and 2021 (in thousands).

			Three Months Ended March 31,
			2022						2021						Variance
Leasing revenues:
Operating leases			$	388,945					$	339,794					$	49,151
Finance leases			28,143						6,949						21,194
Total leasing revenues			417,088						346,743						70,345
Equipment trading revenues			34,120						25,945						8,175
Equipment trading expenses			(29,979)						(17,804)						(12,175)
Trading margin			4,141						8,141						(4,000)
Net gain on sale of leasing equipment			28,969						21,967						7,002
Operating expenses:
Depreciation and amortization			160,716						143,307						17,409
Direct operating expenses			6,220						9,370						(3,150)
Administrative expenses			21,300						20,921						379
Provision (reversal) for doubtful accounts			(27)						(2,464)						2,437
Total operating expenses			188,209						171,134						17,075
Operating income (loss)			261,989						205,717						56,272
Other expenses:
Interest and debt expense			54,510						54,623						(113)
Unrealized (gain) loss on derivative instruments, net			(439)						—						(439)
Debt termination expense			36						—						36
Other (income) expense, net			(308)						(481)						173
Total other expenses			53,799						54,142						(343)
Income (loss) before income taxes			208,190						151,575						56,615
Income tax expense (benefit)			13,932						11,737						2,195
Net income (loss)			$	194,258					$	139,838					$	54,420
Less: dividend on preferred shares			13,028						10,513						2,515
Net income (loss) attributable to common shareholders			$	181,230					$	129,325					$	51,905

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Comparison of the three months ended March 31, 2022 and 2021

Leasing revenues.    Per diem revenue represents revenue earned under operating lease contracts. Fee and ancillary lease revenue represents fees billed for the pick-up and drop-off of containers in certain geographic locations and billings of certain reimbursable operating costs such as repair and handling expenses. Finance lease revenue represents interest income earned under finance lease contracts. The following table summarizes our leasing revenues for the periods indicated below (in thousands):

			Three Months Ended March 31,
			2022						2021						Variance
Leasing revenues:
Operating leases
Per diem revenues			$	377,514					$	331,252					$	46,262
Fee and ancillary revenues			11,431						8,542						2,889
Total operating lease revenues			388,945						339,794						49,151
Finance leases			28,143						6,949						21,194
Total leasing revenues			$	417,088					$	346,743					$	70,345

Total leasing revenues were $417.1 million for the three months ended March 31, 2022, compared to $346.7 million in the same period in 2021, an increase of $70.4 million.

Per diem revenues were $377.5 million for the three months ended March 31, 2022 compared to $331.3 million in the same period in 2021, an increase of $46.2 million. The primary reasons for this increase are as follows:

•$26.1 million increase due to an increase in the average number of containers on-hire of approximately 0.5 million CEU; and

•$18.3 million increase primarily due to an increase in average per diem rates for our dry containers partially offset by a decrease in average per diem rates for our refrigerated and special containers.

Fee and ancillary lease revenues were $11.4 million for the three months ended March 31, 2022 compared to $8.5 million in the same period in 2021, an increase of $2.9 million, primarily due to an increase in fee revenues related to the repositioning of containers.

Finance lease revenues were $28.1 million for the three months ended March 31, 2022 compared to $6.9 million in the same period in 2021, an increase of $21.2 million. This increase is primarily due to the addition of $1.5 billion of net finance lease receivable since April 2021 partially offset by the runoff of the existing portfolio.

Trading margin.    Trading margin was $4.1 million for the three months ended March 31, 2022 compared to $8.1 million in the same period in 2021, a decrease of $4.0 million. The decrease was primarily due to a decrease in container sales volumes.

Net gain (loss) on sale of leasing equipment.    Gain on sale of equipment was $29.0 million for the three months ended March 31, 2022 compared to $22.0 million in the same period in 2021, an increase of $7.0 million. The increase was primarily due to a 36.1% increase in the average sale price of our used dry containers, partially offset by a 29.4% decrease in sales volumes due to our limited inventory of containers available for sale.

Depreciation and amortization.    Depreciation and amortization was $160.7 million for the three months ended March 31, 2022 compared to $143.3 million in the same period in 2021, an increase of $17.4 million. The primary reasons for the increase are as follows:

•$26.5 million increase due to the increased size of our container fleet; partially offset by

•$7.7 million decrease due to an increase in the number of containers that have become fully depreciated.

Direct operating expenses.    Direct operating expenses primarily consist of our costs to repair equipment returned off lease, store equipment when it is not on lease and reposition equipment from locations with weak leasing demand. Direct operating expenses were $6.2 million for the three months ended March 31, 2022 compared to $9.4 million in the same period in 2021, a decrease of $3.2 million. The primary reasons for the decrease are as follows:

•$2.0 million decrease in repair, handling and repositioning expense primarily due to timing of drop-off activity; and

•$0.9 million decrease in storage expense resulting from a decrease in the number of idle units.

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Administrative expenses.    Administrative expenses were $21.3 million for the three months ended March 31, 2022 compared to $20.9 million in the same period in 2021, an increase of $0.4 million.

Provision (reversal) for doubtful accounts.    Reversal for doubtful accounts was immaterial for the three months ended March 31, 2022, compared to $2.5 million in the same period in 2021. We reversed reserves in the first quarter of 2021 which were originally recorded in 2020 against a mid-sized customer receivable.

Interest and debt expense.    Interest and debt expense was $54.5 million for the three months ended March 31, 2022, compared to $54.6 million in the same period in 2021, a decrease of $0.1 million. The primary reasons for the decrease are as follows:

•$17.4 million decrease due to a decrease in the average effective interest rate to 2.50% from 3.30%; partially offset by

•$17.3 million increase due to an increase in the average debt balance of $2.1 billion.

Income taxes. Income tax expense was $13.9 million for the three months ended March 31, 2022 compared to $11.7 million in the same period in 2021, an increase of $2.2 million. The increase in income tax expense was primarily the result of an increase in pre-tax income partially offset by a decrease in the portion of income generated in higher tax jurisdictions in the three months ended March 31, 2022.

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Contractual Obligations

We are party to various operating and finance leases and are obligated to make payments related to our borrowings. We are also obligated under various commercial commitments, including payment obligations to our equipment manufacturers. Our equipment manufacturer obligations are in the form of conventional accounts payable, and are satisfied by cash flows from operations and financing activities.

The following table summarizes our contractual commitments and obligations as of March 31, 2022 and the effect such obligations are expected to have on our liquidity and cash flows in future periods:

			Contractual Obligations by Period
Contractual Obligations:			Total						Remaining 2022						2023						2024						2025						2026						2027 and thereafter
			(dollars in millions)
Principal debt obligations			$	8,798.1					$	346.9					$	1,230.1					$	1,251.7					$	428.2					$	2,558.3					$	2,982.9
Interest on debt obligations(1)			1,077.3						159.9						196.8						169.3						149.0						119.4						282.9
Operating leases (mainly facilities)			5.7						2.7						2.3						0.6						0.1						—						—
Purchase obligations:
Equipment purchases payable			56.8						56.8						—						—						—						—						—
Equipment purchase commitments			259.5						259.5						—						—						—						—						—
Total contractual obligations			$	10,197.4					$	825.8					$	1,429.2					$	1,421.6					$	577.3					$	2,677.7					$	3,265.8

(1)Amounts include actual interest for fixed debt, estimated interest for floating-rate debt and interest rate swaps which are in a payable position based on March 31, 2022 rates.

Critical Accounting Estimates

Our consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires us to make estimates and assumptions that affect the amounts and disclosures reported in the consolidated financial statements and accompanying notes. We base our estimates and judgments on historical experience and on various other assumptions that we believe are reasonable under the circumstances. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions or conditions. For a discussion of our critical accounting estimates, see Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2021 Annual Report on Form 10-K. There have been no significant changes to our critical accounting estimates since our 2021 Annual Report on Form 10-K.

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ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is the risk of loss to future earnings, values or cash flows that may result from changes in the price of a financial instrument. The fair value of a financial instrument, derivative or non-derivative, might change as a result of changes in interest rates, exchange rates, commodity prices, equity prices and other market changes. We have operations internationally and we are exposed to market risks in the ordinary course of our business. These risks include interest rate and foreign currency exchange rate risks.

Interest Rate Risk

We enter into derivative agreements to fix the interest rates on a portion of our floating-rate debt. We assess and manage the external and internal risk associated with these derivative instruments in accordance with our overall operating goals. External risk is defined as those risks outside of our direct control, including counterparty credit risk, liquidity risk, systemic risk and legal risk. Internal risk relates to those operational risks within the management oversight structure and include actions taken in contravention of our policies.

The primary external risk of our derivative agreements is counterparty credit exposure, which is defined as the ability of a counterparty to perform its financial obligations under the agreement. All of our derivative agreements are with highly-rated financial institutions. Credit exposures are measured based on counterparty credit risks and the market value of outstanding derivative instruments.

As of March 31, 2022, we had derivative agreements in place to fix interest rates on a portion of our borrowings under debt facilities with floating interest rates as summarized below:

Derivatives

Notional Amount

Weighted Average Fixed Leg (Pay) Interest Rate

Cap Rate

Weighted Average Remaining Term

Interest Rate Swap(1)

$1,617.4 Million

2.04%

n/a

4.0 years

Interest Rate Cap

$400.0 Million

n/a

5.5%

1.7 years

(1)     The impact of forward starting swaps with total notional amount of $350.0 million will increase the weighted average remaining term to 5.0 years.

Our derivative agreements are designated as cash flow hedges for accounting purposes. Any unrealized gains or losses related to the changes in fair value are recognized in accumulated other comprehensive income and reclassified to interest and debt expense as they are realized. As of March 31, 2022, we have certain interest rate cap agreements that are non-designated derivatives and changes in fair value are recognized as unrealized (gain) loss on derivative instruments, net, on the statements of operations.

Approximately 87% of our debt is either fixed or hedged using derivative instruments which helps mitigate the impact of changes in short-term interest rates. A 100 basis point increase in the interest rates on our unhedged debt (primarily LIBOR) would result in an increase of approximately $11.5 million in interest expense over the next 12 months.

Foreign currency exchange rate risk

Although we have significant foreign-based operations, the majority of our revenues and our operating expenses are denominated in U.S. dollars. However, we pay our non-U.S. employees in local currencies and certain operating expenses are denominated in foreign currencies. Net foreign currency exchange gains and losses were immaterial for the three months ended March 31, 2022 and 2021.

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ITEM 4.    CONTROLS AND PROCEDURES.

Our senior management has evaluated the effectiveness and design of our disclosure controls and procedures (as defined under Rules 13a-15(e) and 15d-15(e)), as of March 31, 2022. Based upon their evaluation of these disclosure controls and procedures, our Chief Executive Officer and our Senior Vice President and Chief Financial Officer concluded, as of March 31, 2022, that our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the three months ended March 31, 2022, which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS.

From time to time, we are a party to litigation matters arising in connection with the normal course of our business. While we cannot predict the outcome of these matters, in the opinion of our management, based on information presently available to us, we believe that we have adequate legal defenses, reserves or insurance coverage and any liability arising from these matters will not have a material adverse effect on our business. Nevertheless, unexpected adverse future events, such as an unforeseen development in our existing proceedings, a significant increase in the number of new cases or changes in our current insurance arrangements could result in liabilities that have a material adverse impact on our business.

ITEM 1A.    RISK FACTORS.

The war in Ukraine may negatively impact international trade and our business.

The ongoing war in Ukraine has resulted in economic and trade disruptions, as well as a significant humanitarian crisis. The conflict has led to significant stress on the global economy, as well as economic sanctions and trade controls being placed on Russia, port restrictions on Russian ships and decisions to suspend service to Russia and alter certain routes by several major ocean carriers. We do not have any employees or Company facilities in Russia, and our direct exposure to customers whose businesses are focused on trading with Russia is not material, representing approximately $30 million in net book value of leased containers. However, given the nature of our business and global operations, political, economic and other conditions in major regions, including geopolitical risks such as the current war in Ukraine, may adversely affect us. Further sanctions, embargoes, regional instability, shipping bans, escalation of hostilities and the effects of the conflict on the global economy, including increased on-shoring and near-shoring and reduced global trade, cannot be predicted. These factors may negatively impact our business and results of operations.

For a detailed discussion of our other risk factors, refer to our Form 10-K.

ITEM 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

Share Repurchase Program

In October 2021, our Board of Directors increased our share repurchase authorization to $200 million. The following table provides certain information with respect to the Company's purchases of its common shares during the three months ended March 31, 2022:

			Issuer Purchases of Common Shares(1)
Period			Total number of shares purchased(2)						Average price paid per share												Approximate dollar value of shares that may yet be purchased under the plan (in thousands)
January 1, 2022 through January 31, 2022			455,000						$	61.73											$	118,847
February 1, 2022 through February 28, 2022			393,535						$	63.71											$	93,769
March 1, 2022 through March 31, 2022			408,839						$	66.00											$	66,775
Total			1,257,374						$	63.74											$	66,775

(1)On April 26, 2022, the Company's Board of Directors increased the share repurchase authorization to $200.0 million. The revised authorization may be used by the Company to repurchase common or preferred shares.

(2)This column represents the total number of shares purchased and the total number of shares purchased as part of publicly announced plans.

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ITEM 6.    EXHIBITS.

Exhibit Number						Exhibit Description
10.1*+						Form of Restricted Share Award Agreement under the Triton International Limited Amended and Restated 2016 Equity Incentive Plan
10.2*+						Form of Restricted Share Unit Award Agreement under the Triton International Limited Amended and Restated 2016 Equity Incentive Plan
10.3						Triton International Limited Executive Severance Plan (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed February 14, 2022)
10.4						Letter Agreement between Brian M. Sondey and Triton International Limited, dated February 11, 2022 (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed February 14, 2022)
22.1						List of Subsidiary Guarantors and Issuers of Guaranteed Securities (incorporated by reference to Exhibit 22.1 to the Company's Current Report on Form 8-K filed January 19, 2022)
31.1*						Certification of the Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended
31.2*						Certification of the Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended
32.1**						Certification by Chief Executive Officer pursuant to 18 U.S.C. Section 1350
32.2**						Certification by Chief Financial Officer pursuant to 18 U.S.C. Section 1350
101.INS						XBRL Instance Document - the instance document does not appear on the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH						XBRL Instance Extension Schema
101.CAL						XBRL Taxonomy Extension Calculation Linkbase
101.DEF						XBRL Taxonomy Extension Definition Linkbase
101.LAB						XBRL Taxonomy Extension Label Linkbase
101.PRE						XBRL Taxonomy Extension Presentation Linkbase
104						Cover Page Inline XBRL Data (formatted as Inline XBRL and contained in Exhibit 101)

______________________________________________________________________________

*			Filed herewith.
**			Furnished herewith.
+			Indicates a management contract or compensatory plan or arrangement.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			TRITON INTERNATIONAL LIMITED
May 3, 2022			By:			/s/ JOHN BURNS
						John Burns
						Chief Financial Officer

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