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CST: 22/09/2020 18:53:21   

FreightCar America, Inc. Reports First Quarter 2019 Results

510 Days ago

Company continues to execute its ‘Back to Basics’ initiatives; reaffirms full-year delivery and material cost 
savings guidance; product development now a top priority

CHICAGO, May 01, 2019 (GLOBE NEWSWIRE) -- FreightCar America, Inc. (NASDAQ: RAIL) today reported results for the first quarter ended March 31, 2019.

Business Highlights

  • First quarter revenue of $70.7 million on deliveries of 641 units
  • First quarter net loss of $14.0 million, or $1.12 per diluted share
  • Total cash, cash equivalents, restricted cash equivalents, marketable securities and restricted certificates of deposit of $68.7 million at March 31, 2019, essentially unchanged from the prior quarter
  • Backlog now totals 1,752 railcars with an aggregate value of approximately $152 million
  • Company reaffirms guidance to deliver between 2,500 and 3,500 railcars and achieve additional material cost savings of between $2,000 and $3,000 per railcar, on a run-rate basis, excluding commodity price movements, by the end of 2019

"We have made tremendous progress on our strategic initiatives to revamp our operations and reduce material and labor costs. As this work continues, we are also now accelerating efforts to strengthen our product portfolio to better align with market needs and drive top-line growth,” said Jim Meyer, President and Chief Executive Officer of FreightCar America. "Our results were in line with our expectations for the quarter and as we have said previously, our goal is to be substantially retooled as a company within the year and to have FreightCar America well positioned for long-term growth and success, beginning in 2020.”

First Quarter Results

  • Consolidated revenues were $70.7 million in the first quarter of 2019 compared to $83.0 million in the same quarter of 2018. The Company delivered 641 railcars in the first quarter of 2019, all of which were new railcars. This compares to 1,094 railcars delivered in the first quarter of 2018, which included 891 new railcars, 81 rebuilt railcars, and 122 leased railcars.

  • The Company had a diversified backlog totaling 1,752 railcars at March 31, 2019, valued at approximately $152 million.

  • Consolidated operating loss for the first quarter of 2019 was $14.5 million compared to an operating loss of $8.6 million for the first quarter of 2018.

  • Net loss in the first quarter of 2019 was $14.0 million, or $1.12 per diluted share, compared to net loss of $6.4 million, or $0.51 per diluted share, in the first quarter of 2018.  The quarterly loss was primarily attributable to lower volumes, price/mix, and higher warranty costs associated with products produced in prior years.

  • Cash, cash equivalents, restricted cash equivalents, marketable securities and restricted certificates of deposit were $68.7 million as of March 31, 2019, compared to $68.0 million at December 31, 2018.

  • Effective the beginning of the quarter, the Company adopted the new lease accounting standard which added lease liabilities and right-of-use assets to the Company’s balance sheet.

First Quarter 2019 Conference Call & Webcast Information

The Company will host a conference call and live webcast on Thursday, May 2, 2019 at 11:00 a.m. (Eastern Daylight Time) to discuss the Company’s first quarter 2019 financial results. To participate in the conference call, please dial (800) 288-8960, Confirmation Number 466777.  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#: 466777

If you need technical assistance, call the toll-free AT&T Conference Casting Support Help Line at (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 Daylight Time) on May 2, 2019 until 11:59 p.m. (Eastern Daylight Time) on June 2, 2019.  To access the replay, please dial (800) 475-6701.  The replay pass code is 466777.  An audio replay of the call will be available on the Company’s website within two days following the earnings call.

About FreightCar America, Inc.

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; Grand Island, Nebraska; Johnstown, Pennsylvania; Roanoke, Virginia; and Shanghai, People’s Republic of China. More information about FreightCar America is available on its website at www.freightcaramerica.com.

Forward Looking Statements

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: risks relating to the Shoals facility, including the facility not meeting internal assumptions or expectations and unforeseen liabilities from Navistar; 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 other competitive factors. 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)
     
  March 31, December 31,
  2019 2018
  (In thousands)
Assets    
Current assets    
Cash, cash equivalents and restricted cash equivalents $ 65,000   $ 45,070  
Restricted certificates of deposit   1,668     4,952  
Marketable securities   1,998     18,019  
Accounts receivable, net   9,290     18,218  
Inventories, net   52,700     64,562  
Other current assets   7,373     5,012  
Total current assets   138,029     155,833  
     
Property, plant and equipment, net   43,406     45,317  
Railcars available for lease, net   64,370     64,755  
Right of use asset   74,174     -  
Goodwill   21,521     21,521  
Other long-term assets   2,583     2,311  
Total assets $ 344,083   $ 289,737  
     

Liabilities and Stockholders’ Equity
   
Current liabilities    
Accounts and contractual payables $ 30,586   $ 34,749  
Accrued payroll and other employee costs   1,998     1,639  
Reserve for workers’ compensation   3,527     3,344  
Accrued warranty   11,045     9,309  
Customer deposits   1,281     3,000  
Deferred income state and local incentives, current   2,219     2,219  
Deferred rent, current   -     6,466  
Lease liability, current   16,840     -  
Other current liabilities   1,325     1,324  
Total current liabilities   68,821     62,050  
Accrued pension costs   5,752     5,841  
Accrued postretirement benefits, less current portion   4,907     4,975  
Deferred income state and local incentives, long-term   6,387     6,941  
Deferred rent, long-term   -     15,519  
Lease liability, long-term   77,281     -  
Accrued taxes and other long-term liabilities   476     801  
Total liabilities   163,624     96,127  
     
Stockholders’ equity    
Preferred stock        
Common stock   127     127  
Additional paid in capital   86,074     90,593  
Treasury stock, at cost   (4,572 )   (9,721 )
Accumulated other comprehensive loss   (8,145 )   (8,188 )
Retained earnings   106,975     120,799  
             
Total stockholders’ equity   180,459     193,610  
Total liabilities and stockholders’ equity $ 344,083   $ 289,737  
             


FreightCar America, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
     
    Three Months Ended
March 31,
    2019 2018
    (In thousands, except for share
and per 
share data)
       
Revenues   $ 70,708     $ 82,973  
Cost of sales     77,557       83,569  
Gross loss     (6,849 )     (596 )
Selling, general and administrative expenses     7,667       7,996  
Restructuring and impairment charges            
Operating loss     (14,516 )     (8,592 )
       
Interest expense and deferred financing costs     (36 )     (32 )
Other income (expense)     319       381  
Loss before income taxes     (14,233 )     (8,243 )
Income tax (benefit) provision     (201 )     (1,839 )
Net loss   $ (14,032 )   $ (6,404 )
       
Net loss per common share – basic   $ (1.12 )   $ (0.51 )
       
Net loss per common share – diluted   $ (1.12 )   $ (0.51 )
       
Weighted average common shares outstanding -      
basic     12,337,013       12,306,011  
       
Weighted average common shares outstanding -      
diluted     12,337,013       12,306,011  
       
Dividends declared per common share   $     $  
       


FreightCar America, Inc.
Segment Data
(Unaudited)
     
    Three Months Ended
March 31,
    2019 2018
    (In thousands)
Revenues:      
Manufacturing   $ 67,595     $ 79,733  
Corporate and Other     3,113       3,240  
Consolidated revenues   $ 70,708     $ 82,973  
       
Operating loss:      
Manufacturing   $ (9,637 )   $ (3,816 )
Corporate and Other     (4,879 )     (4,776 )
Consolidated operating loss   $ (14,516 )   $ (8,592 )
                 


FreightCar America, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
   
  Three Months Ended
March 31,
  2019   2018
  (In thousands)
Cash flows from operating activities    
     
Net loss $ (14,032 )   $ (6,404 )
Adjustments to reconcile net loss to net cash
flows provided by (used in) operating activities:
   
Net proceeds from Shoals transaction         2,655  
Depreciation and amortization   3,206       2,550  
Amortization expense – right-of-use leased assets   3,202        
Recognition of deferred income from state and local incentives   (554 )     (555 )
Deferred income taxes         (1,992 )
Stock-based compensation recognized   689       836  
Other non-cash items, net   (736 )     273  
Changes in operating assets and liabilities, net of acquisitions:    
Accounts receivable   8,928       (5,330 )
Inventories   12,591       1,930  
Inventories on lease         (9,186 )
Other assets   (2,355 )     (3,323 )
Accounts and contractual payables   (4,516 )     2,284  
Accrued payroll and employee benefits   359       338  
Income taxes receivable/payable   (200 )     650  
Accrued warranty   1,736       979  
Lease liability   (5,037 )      
Other liabilities   (1,460 )     1,223  
Accrued pension costs and accrued postretirement benefits   (114 )     (418 )
Net cash flows provided by (used in) operating activities   1,707       (13,490 )
     
Cash flows from investing activities    
     
Purchase of restricted certificates of deposit   (1,117 )     (1,040 )
Maturity of restricted certificates of deposit   4,400       1,308  
Purchase of securities held to maturity   (1,986 )     (41,244 )
Proceeds from maturity of securities   18,025       32,005  
Purchases of property, plant and equipment   (760 )     (182 )
Proceeds from sale of property, plant and equipment and railcars available for lease         228  
Net cash flows provided by (used in) investing activities   18,562       (8,925 )
     
Cash flows from financing activities    
     
Employee stock settlement   (59 )     (118 )
Deferred financing costs   (280 )      
Net cash flows used in financing activities   (339 )     (118 )
     
Net decrease in cash and cash equivalents $ (19,930 )   $ (22,533 )
Cash, cash equivalents and restricted cash equivalents at beginning of period $ 45,070     $ 87,788  
Cash, cash equivalents and restricted cash equivalents at end of period $ 65,000     $ 65,255  


INVESTOR & MEDIA CONTACT Christopher J. Eppel
TELEPHONE (800) 458-2235

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