Highlights
-
Net income of $14.8 million, or $1.20 per diluted share
-
Third quarter pre-tax gain on sale of the railcar repair and
maintenance services business of $4.6 million, or $0.24 per diluted
share, after tax
-
Revenue of $241.1 million on deliveries of 2,846 units
-
Orders for 1,008 railcars received during the quarter
-
Backlog totaling 12,237 railcars valued at $1.12 billion
CHICAGO--(BUSINESS WIRE)--
FreightCar America, Inc. (NASDAQ: RAIL) today reported results for the
third quarter ended September 30, 2015, with revenues of $241.1 million
and net income of $14.8 million, or $1.20 per diluted share. Third
quarter 2015 results included a pre-tax gain of $4.6 million, or $0.24
per diluted share on an after-tax basis, related to the sale of the
railcar repair and maintenance services business completed on September
30, 2015 for $20.0 million in cash and the assumption of certain
liabilities by the purchaser. For the third quarter of 2014, the Company
reported revenues of $190.3 million and net income of $6.4 million, or
$0.53 per diluted share, of which $0.05 per diluted share related to the
gain on sale of the Clinton, Indiana, repair facility. Revenues were
$235.6 million with net income of $7.4 million, or $0.60 per diluted
share, in the second quarter of 2015.
President and Chief Executive Officer Joe McNeely commented, “Our third
quarter earnings grew significantly both year over year and
sequentially, a result of higher railcar deliveries and a stronger
manufacturing margin. During the quarter, we saw operational
improvements throughout our organization, including at the Shoals
facility, where production continued to ramp up. The sale of the railcar
repair and maintenance services business during the quarter will allow
us to increase our focus on the railcar manufacturing, parts and leasing
businesses, while continuing to diversify our railcar portfolio and
striving for greater productivity gains throughout the Company.”
McNeely concluded, “Looking forward, we expect our full year 2015
deliveries to be between 9,000 and 9,500 railcars. The Company is well
positioned with a backlog of just over 12,000 railcars, which consists
almost exclusively of non-coal cars. Supported by orders in the backlog,
we are planning deliveries of between 7,000 and 8,000 railcars in 2016,
as we do not see any meaningful coal car orders in the near term to
replace the coal car rebuild program that is concluding this year.”
The Company delivered 2,846 railcars in the third quarter of 2015, which
included 2,076 new and 770 rebuilt railcars. This compares to 2,354
railcars delivered in the third quarter of 2014, which included 1,554
new and 800 rebuilt cars. There were 2,611 railcars delivered in the
second quarter of 2015, of which 1,861 were new and 750 were rebuilds.
Total manufacturing backlog was 12,237 units at September 30, 2015,
compared to 13,514 units at September 30, 2014 and 14,075 units at June
30, 2015. Non-coal cars comprised 11,522 units, or 94% of the total
backlog, at September 30, 2015, compared to 8,914 units, or 66% of the
total backlog, at September 30, 2014 and 12,158 units, or 86% of the
total backlog, at June 30, 2015.
The Manufacturing segment had revenues of $233.3 million in the third
quarter of 2015, compared to $181.5 million for the same period of 2014
and $227.0 million in the second quarter of 2015. The Manufacturing
segment operating income was $25.8 million in the third quarter of 2015,
compared to $16.2 million in the third quarter of 2014 and $17.2 million
for the second quarter of 2015.
Revenues for the Services segment were $7.8 million in the third quarter
of 2015, compared to $8.8 million in the third quarter of 2014 and $8.6
million in the second quarter of 2015. The Services segment operating
income was $5.2 million in the third quarter of 2015, compared to $1.6
million in the third quarter of 2014 and $1.5 million in the second
quarter of 2015. Services segment operating income in the third quarter
of 2015 included a pre-tax gain of $4.6 million related to the sale of
the railcar repair and maintenance services business, while Services
segment operating income in the third quarter of 2014 included a pre-tax
gain of $1.1 million related to the sale of the Clinton, Indiana repair
facility.
Cash, cash equivalents, marketable securities and restricted cash were
$131.9 million as of September 30, 2015, compared to $167.5 million as
of December 31, 2014. The decrease was driven primarily by an increase
in inventory to support production requirements and utilization of a
customer deposit, partially offset by the receipt of net cash proceeds
of $17.6 million related to the sale of the railcar repair and
maintenance services business and the receipt of $15.7 million
associated with Alabama state and local incentives.
The Company will host a conference call and live webcast on Tuesday,
November 3, 2015 at 11:00 a.m. (Eastern Standard Time) to discuss the
Company’s third quarter 2015 financial results. To participate in the
conference call, please dial (800) 700-7860, Confirmation Number 371914.
Interested parties are asked to dial in approximately 10 to 15 minutes
prior to the start time of the call. The live audio-only webcast can be
accessed at:
Event URL: https://im.csgsystems.com/cgi-bin/confCast
Conference ID#: 371914
If you need technical assistance, call the toll-free AT&T Conference
Casting Support Help Line at 1-888-793-6118. Please note that the
webcast is listen-only and webcast participants will not be able to
participate in the question and answer portion of the conference call.
An audio replay of the conference call will be available beginning at
1:00 p.m. (Eastern Standard Time) on November 3, 2015 until 11:59 p.m.
(Eastern Standard Time) on December 3, 2015. To access the replay,
please dial (800) 475-6701. The replay pass code is 371914. An audio
replay of the call will be available on the Company’s website within two
days following the earnings call.
FreightCar America, Inc. manufactures a wide range of railroad freight
cars, supplies railcar parts and leases freight cars through its JAIX
Leasing Company subsidiary. FreightCar America designs and builds
high-quality railcars, including coal cars, bulk commodity cars, covered
hopper cars, intermodal and non-intermodal flat cars, mill gondola cars,
coil steel cars and boxcars. It is headquartered in Chicago, Illinois
and has facilities in the following locations: Cherokee, Alabama;
Danville, Illinois; Grand Island, Nebraska; Johnstown, Pennsylvania; and
Roanoke, Virginia. More information about FreightCar America is
available on its website at www.freightcaramerica.com.
This press release may contain statements relating to our expected
financial performance and/or future business prospects, events and plans
that are “forward-looking statements” as defined under the Private
Securities Litigation Reform Act of 1995. Forward-looking statements
represent our estimates and assumptions only as of the date of this
press release. Our actual results may differ materially from the results
described in or anticipated by our forward-looking statements due to
certain risks and uncertainties. These potential risks and uncertainties
include, among other things: the cyclical nature of our business;
adverse economic and market conditions; fluctuating costs of raw
materials, including steel and aluminum, and delays in the delivery of
raw materials; our ability to maintain relationships with our suppliers
of railcar components; our reliance upon a small number of customers
that represent a large percentage of our sales; the variable purchase
patterns of our customers and the timing of completion, delivery and
customer acceptance of orders; the highly competitive nature of our
industry; the risk of lack of acceptance of our new railcar offerings by
our customers; and the additional risk factors described in our filings
with the Securities and Exchange Commission. We expressly disclaim any
duty to provide updates to any forward-looking statements made in this
press release, whether as a result of new information, future events or
otherwise.
FreightCar America, Inc.
Condensed Consolidated
Balance Sheets
(Unaudited) |
|
| |
| |
| | September 30, | | December 31, |
| | 2015 |
| 2014 |
| | (In thousands) |
| Assets | | | | |
|
Current assets
| | | | |
|
Cash and cash equivalents
| |
$
|
94,997
| | |
$
|
113,532
| |
|
Restricted cash and restricted certificates of deposit
| | |
6,896
| | | |
6,015
| |
|
Marketable securities
| | |
30,009
| | | |
47,961
| |
|
Accounts receivable, net
| | |
28,824
| | | |
4,086
| |
|
Inventories, net
| | |
141,676
| | | |
82,259
| |
|
Inventory on lease
| | |
—
| | | |
116
| |
|
Other current assets
| | |
8,300
| | | |
7,057
| |
|
Deferred income taxes, net
| |
|
10,214
|
|
|
|
12,139
|
|
|
Total current assets
| | |
320,916
| | | |
273,165
| |
| | | |
|
|
Property, plant and equipment, net
| | |
44,055
| | | |
43,239
| |
|
Railcars available for lease, net
| | |
16,126
| | | |
22,897
| |
| Goodwill | | |
21,521
| | | |
22,128
| |
|
Deferred income taxes, net
| | |
22,883
| | | |
21,553
| |
|
Other long-term assets
| |
|
2,900
|
|
|
|
2,270
|
|
|
Total assets
| |
$
|
428,401
|
|
|
$
|
385,252
|
|
| | | |
|
Liabilities and Stockholders’ Equity | | | | |
|
Current liabilities
| | | | |
|
Accounts and contractual payables
| |
$
|
59,136
| | |
$
|
34,010
| |
|
Accrued payroll and employee benefits
| | |
6,565
| | | |
6,462
| |
|
Accrued postretirement benefits
| | |
409
| | | |
409
| |
|
Accrued warranty
| | |
9,305
| | | |
8,742
| |
|
Customer deposits and deferred revenue
| | |
11,074
| | | |
43,977
| |
|
Income taxes payable
| | |
7,308
| | | |
—
| |
|
Other current liabilities
| |
|
7,458
|
|
|
|
4,725
|
|
|
Total current liabilities
| | |
101,255
| | | |
98,325
| |
|
Accrued pension costs
| | |
6,665
| | | |
7,210
| |
|
Accrued postretirement benefits, less current portion
| | |
75,460
| | | |
73,474
| |
|
Deferred income – state and local incentives, long-term
| | |
12,722
| | | |
—
| |
|
Accrued taxes and other long-term liabilities
| |
|
10,699
|
|
|
|
7,548
|
|
|
Total liabilities
| |
|
206,801
|
|
|
|
186,557
|
|
| | | |
|
|
Stockholders’ equity
| | | | |
|
Preferred stock
| | |
—
| | | |
—
| |
|
Common stock
| | |
127
| | | |
127
| |
|
Additional paid in capital
| | |
93,488
| | | |
100,303
| |
| Treasury stock, at cost
| | |
(17,623
|
)
| | |
(29,971
|
)
|
|
Accumulated other comprehensive loss
| | |
(23,486
|
)
| | |
(24,017
|
)
|
|
Retained earnings
| |
|
169,094
|
|
|
|
152,253
|
|
|
Total stockholders’ equity
| |
|
221,600
|
|
|
|
198,695
|
|
|
Total liabilities and stockholders’ equity
| |
$
|
428,401
|
|
|
$
|
385,252
|
|
| | | | | | | |
|
FreightCar America, Inc.
Condensed Consolidated
Statements of Operations
(Unaudited) |
|
| |
| |
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | 2015 |
| 2014 |
| 2015 |
| 2014 |
| | (In thousands, except for share and per share data) |
| | |
| | | |
| |
|
Revenues
| |
$
|
241,114
| | |
$
|
190,280
| | |
$
|
569,555
| | |
$
|
386,054
| |
|
Cost of sales
| |
|
212,064
|
|
|
|
171,461
|
| |
|
514,146
|
|
|
|
359,333
|
|
|
Gross profit
| | |
29,050
| | | |
18,819
| | | |
55,409
| | | |
26,721
| |
|
Selling, general and administrative expenses
| | |
10,706
| | | |
9,215
| | | |
30,473
| | | |
26,296
| |
|
Gain on sale of railcars available for lease
| | |
—
| | | |
(635
|
)
| | |
(1,187
|
)
| | |
(653
|
)
|
|
Gain on sale of railcar repair and maintenance services business and
facility
| |
|
(4,578
|
)
|
|
|
(1,078
|
)
| |
|
(4,578
|
)
|
|
|
(1,078
|
)
|
|
Operating income
| | |
22,922
| | | |
11,317
| | | |
30,701
| | | |
2,156
| |
| | | | | | | |
|
|
Interest expense and deferred financing costs
| | |
(56
|
)
| | |
(284
|
)
| | |
(184
|
)
| | |
(854
|
)
|
|
Other income
| |
|
8
|
|
|
|
7
|
| |
|
91
|
|
|
|
48
|
|
|
Income before income taxes
| | |
22,874
| | | |
11,040
| | | |
30,608
| | | |
1,350
| |
|
Income tax provision
| |
|
8,047
|
|
|
|
4,608
|
| |
|
10,457
|
|
|
|
252
|
|
|
Net income
| |
$
|
14,827
|
|
|
$
|
6,432
|
| |
$
|
20,151
|
|
|
$
|
1,098
|
|
| | | | | | | |
|
Net income per common share - basic
| |
$
|
1.20
|
|
|
$
|
0.53
|
| |
$
|
1.65
|
|
|
$
|
0.09
|
|
| | | | | | | |
|
Net income per common share - diluted
| |
$
|
1.20
|
|
|
$
|
0.53
|
| |
$
|
1.64
|
|
|
$
|
0.09
|
|
| | | | | | | |
|
Weighted average common shares outstanding - basic
| |
|
12,241,211
|
|
|
|
12,007,970
|
| |
|
12,153,313
|
|
|
|
11,999,150
|
|
| | | | | | | |
|
Weighted average common shares outstanding - diluted
| |
|
12,241,426
|
|
|
|
12,108,397
|
| |
|
12,207,432
|
|
|
|
12,088,728
|
|
| | | | | | | |
|
|
Dividends declared per common share
| |
$
|
0.09
|
|
|
$
|
0.06
|
| |
$
|
0.27
|
|
|
$
|
0.18
|
|
| | | | | | | | | | | | | | | |
|
FreightCar America, Inc.
Condensed Segment Data
(Unaudited) |
|
| |
| |
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | 2015 |
| 2014 |
| 2015 |
| 2014 |
| | (In thousands) |
| Revenues: | | |
| | | |
| |
|
Manufacturing
| |
$
|
233,294
| | |
$
|
181,490
| | |
$
|
545,407
| | |
$
|
358,248
| |
|
Services
| |
|
7,820
|
|
|
|
8,790
|
|
|
|
24,148
|
|
|
|
27,806
|
|
|
Consolidated revenues
| |
$
|
241,114
|
|
|
$
|
190,280
|
|
|
$
|
569,555
|
|
|
$
|
386,054
|
|
| | | | | | | |
|
| Operating Income (Loss): | | | | | | | | |
|
Manufacturing
| |
$
|
25,817
| | |
$
|
16,185
| | |
$
|
44,910
| | |
$
|
18,584
| |
|
Services(1) | | |
5,229
| | | |
1,633
| | | |
7,917
| | | |
2,277
| |
|
Corporate
| |
|
(8,124
|
)
|
|
|
(6,501
|
)
|
|
|
(22,126
|
)
|
|
|
(18,705
|
)
|
|
Consolidated operating income
| |
$
|
22,922
|
|
|
$
|
11,317
|
|
|
$
|
30,701
|
|
|
$
|
2,156
|
|
| | | | | | | | | | | | | | | |
|
(1) Results for each of the three and nine month
periods ended September 30, 2015 included a $4.6 gain on sale of
the Company’s railcar repair and maintenance services business.
Three and nine month periods ended September 30, 2014 included a
$1.1 million gain on sale of the Company’s closed repair and
maintenance facility.
|
|
|
FreightCar America, Inc.
Condensed Consolidated
Statements of Cash Flows
(Unaudited) |
|
| |
| | Nine Months Ended September 30, |
| | 2015 |
| 2014 |
| | (In thousands) |
| Cash flows from operating activities | | |
| |
|
Net income
| |
$
|
20,151
| | |
$
|
1,098
| |
Adjustments to reconcile net income to net cash flows used in
operating activities:
| | | | |
|
Depreciation and amortization
| | |
7,551
| | | |
7,481
| |
|
Recognition of deferred income from state and local incentives
| | |
(883
|
)
| | |
—
| |
|
Gain on sale of railcars available for lease
| | |
(1,187
|
)
| | |
(653
|
)
|
|
Gain on sale of railcar repair and maintenance services business and
facility
| | |
(4,578
|
)
| | |
(1,078
|
)
|
|
Deferred income taxes
| | |
296
| | | |
116
| |
|
Stock-based compensation expense recognized
| | |
1,686
| | | |
1,576
| |
|
Other non-cash items, net
| | |
1,555
| | | |
795
| |
|
Changes in operating assets and liabilities:
| | | | |
|
Accounts receivable
| | |
(27,514
|
)
| | |
(29,500
|
)
|
|
Inventories
| | |
(63,488
|
)
| | |
(37,509
|
)
|
|
Inventory on lease
| | |
116
| | | |
(8,721
|
)
|
|
Other assets
| | |
(1,307
|
)
| | |
(4,380
|
)
|
|
Accounts and contractual payables
| | |
25,180
| | | |
47,922
| |
|
Accrued payroll and employee benefits
| | |
295
| | | |
1,280
| |
|
Income taxes receivable/payable
| | |
8,050
| | | |
870
| |
|
Accrued warranty
| | |
563
| | | |
1,734
| |
|
Customer deposits and other liabilities
| | |
(29,471
|
)
| | |
(90,794
|
)
|
|
Accrued pension costs and accrued postretirement benefits
| |
|
1,972
|
|
|
|
1,422
|
|
|
Net cash flows used in operating activities
| |
|
(61,013
|
)
|
|
|
(108,341
|
)
|
| | | |
|
| Cash flows from investing activities | | | | |
|
Restricted cash withdrawals
| | |
—
| | | |
2,782
| |
|
Restricted cash deposits
| | |
—
| | | |
(1,017
|
)
|
|
Purchase of restricted certificates of deposit
| | |
(2,165
|
)
| | |
—
| |
|
Maturity of restricted certificates of deposit
| | |
1,284
| | | |
—
| |
|
Purchase of securities held to maturity
| | |
(17,997
|
)
| | |
(50,974
|
)
|
|
Proceeds from maturity of securities
| | |
36,004
| | | |
42,002
| |
|
Proceeds from sale of property, plant and equipment and railcars
available for lease
| | |
7,654
| | | |
5,907
| |
|
Proceeds from sale of railcar repair and maintenance services
business and facility
| | |
17,589
| | | |
2,124
| |
|
Purchases of property, plant and equipment
| | |
(16,161
|
)
| | |
(8,248
|
)
|
|
State and local incentives received
| |
|
15,733
|
|
|
|
—
|
|
|
Net cash flows provided by (used in) investing activities
| |
|
41,941
|
|
|
|
(7,424
|
)
|
| | | |
|
| Cash flows from financing activities | | | | |
|
Stock option exercise
| | |
4,885
| | | |
143
| |
|
Employee stock settlement
| | |
(1,051
|
)
| | |
(224
|
)
|
|
Excess tax benefit from stock-based compensation
| | |
13
| | | |
—
| |
|
Cash dividends paid to stockholders
| | |
(3,310
|
)
| | |
(2,171
|
)
|
|
Reduction in customer advance for production of leased railcars
| |
|
—
|
|
|
|
(1,035
|
)
|
|
Net cash flows provided by (used in) financing activities
| |
|
537
|
|
|
|
(3,287
|
)
|
| | | |
|
|
Net decrease in cash and cash equivalents
| | |
(18,535
|
)
| | |
(119,052
|
)
|
|
Cash and cash equivalents at beginning of period
| |
|
113,532
|
|
|
|
145,506
|
|
|
Cash and cash equivalents at end of period
| |
$
|
94,997
|
|
|
$
|
26,454
|
|
| | | | | | | |
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20151102006697/en/
FreightCar America, Inc.
Charles F. Avery, Jr., 800-458-2235
Source: FreightCar America, Inc.