FreightCar America, Inc. Reports Second Quarter 2022

2022-08-14 18:49:24 By : Ms. Nancy Huang

August 08, 2022 16:15 ET | Source: FreightCar America, Inc. FreightCar America, Inc.

Second quarter 2022 revenue up 52% year-over-year and gross margin of 11.6%

Company raises revenue and delivery outlook for fiscal year 2022

CHICAGO, Aug. 08, 2022 (GLOBE NEWSWIRE) -- FreightCar America, Inc. (NASDAQ: RAIL) (“FCA” or the “Company”), a diversified manufacturer of railroad freight cars, today reported results for the second quarter ended June 30, 2022.

Jim Meyer, President and Chief Executive Officer of FreightCar America, commented, “FreightCar America reported solid results in the second quarter, recording positive Adjusted EBITDA on just 468 railcars due to planned line changeovers which temporarily curtailed production. The changeovers went smoothly and according to plan, and these results demonstrate our ability to generate superior margins even while producing far fewer units and against the continuing backdrop of high steel costs. For the balance of the year, we expect to produce upwards of 2,000 railcars.”

Meyer continued, “Our work to expand the Castaños facility continues, and we believe that we are well on our way to building a world class manufacturing footprint in Northern Mexico with equal focus on product flexibility, quality, and low cost. At the same time, our commercial team remains focused on growing our business in a margin-accretive manner.”

Mike Riordan, Chief Financial Officer, added, “We executed on our strategic and financial objectives in the second quarter, and while our production year-to-date was largely in line with our internal expectations, we are expecting a significant uptick in units delivered for the balance of fiscal 2022. Due to stronger levels of order activity, and a robust backlog, we are raising our previously stated 2022 outlook.”

Second Quarter 2022 Conference Call & Webcast Information

The Company will host a conference call and live webcast on Tuesday, August 9, 2022 at 11:00 a.m. (Eastern Time) to discuss its second quarter 2022 financial results. Investors, analysts, and members of the media interested in listening to the live presentation are encouraged to join a webcast of the call, available at:

Event URL: https://viavid.webcasts.com/starthere.jsp?ei=1558577&tp_key=e146d97490

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. Interested parties may also participate in the call by dialing (877) 407-0789 or (201) 689-8562 and entering the passcode 13731238. Interested parties are asked to dial in approximately 10 to 15 minutes prior to the start time of the call.

An audio replay of the conference call will be available beginning at 2:00 p.m. (Eastern Time) on August 9, 2022, until 12:00 a.m. (Eastern Time) on Wednesday August 23, 2022. To access the replay, please dial (844) 512-2921 or (412) 317-6671. The replay passcode is 13731238. An archived version of the webcast will also be available on the Company’s website.

FreightCar America, Inc. is a diversified manufacturer of railroad freight cars that also supplies railcar parts and leases freight cars through its FreightCar America Leasing Company subsidiaries. FreightCar America designs and builds high-quality railcars, including open top hopper cars, covered hopper cars, intermodal and non-intermodal flat cars, mill gondola cars, coil steel cars, boxcars and coal cars, and also specializes in the conversion of railcars for repurposed use. FreightCar America is headquartered in Chicago, Illinois and has facilities in the following locations: Castaños, Mexico; Johnstown, Pennsylvania; and Shanghai, People’s Republic of China. 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: risks relating to the potential financial and operational impacts of the COVID-19 pandemic; 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.

Condensed Consolidated Balance Sheets (Unaudited)

FreightCar America, Inc. Condensed Consolidated Statements of Operations (Unaudited)

FreightCar America, Inc. Segment Data (Unaudited)

FreightCar America, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited)

FreightCar America, Inc. Reconciliation of income before taxes to EBITDA(1) and Adjusted EBITDA(2) (Unaudited)

(1) EBITDA represents earnings before interest, taxes, depreciation and amortization. We believe EBITDA is useful to investors in evaluating our operating performance compared to that of other companies in our industry. In addition, our management uses EBITDA to evaluate our operating performance. The calculation of EBITDA eliminates the effects of financing, income taxes and the accounting effects of capital spending. These items may vary for different companies for reasons unrelated to the overall performance of the company’s business. EBITDA is not a financial measure presented in accordance with U.S. GAAP. Accordingly, when analyzing our operating performance, investors should not consider EBITDA in isolation or as a substitute for net income, cash flows from operating activities or other statements of operations or statements of cash flow data prepared in accordance with U.S. GAAP. Our calculation of EBITDA is not necessarily comparable to that of other similar titled measures reported by other companies.

(2) Adjusted EBITDA represents EBITDA before the following charges:

a)   This adjustment removes the non-cash (income) expense associated with the change in fair market value of the Company’s warrant liability. b)   The Company incurred certain restructuring costs related to severance and other costs related to its shut-down of the Shoals and Roanoke facilities. c)   The Company amortizes deferred grant income to cost of goods sold that represents a non-cash reduction to its gross margin (loss). d)   The Company incurred certain costs during 2021 for nonrecurring professional services associated with its financing arrangements. e)   The Company incurred certain non-recurring consulting costs during the fourth quarter of 2021 and first quarter of 2022. f)   The Company incurred certain non-recurring corporate realignment costs in the first quarter of 2022. g)   During the first and fourth quarters of 2021, the Company recognized charges related to a legal dispute. h)   During 2020, the Company implemented a program to shift production originally planned for its U.S. plants to its Castaños facility. This adjustment represents non-recurring costs associated with moving inventory and equipment to its Castaños facility.

We believe that Adjusted EBITDA is useful to investors evaluating our operating performance compared to that of other companies in our industry because it eliminates the impact of certain non-cash charges and other special items that affect the comparability of results in past quarters. Adjusted EBITDA is not a financial measure presented in accordance with U.S. GAAP. Accordingly, when analyzing our operating performance, investors should not consider Adjusted EBITDA in isolation or as a substitute for net income, cash flows from operating activities or other statements of operations or statements of cash flow data prepared in accordance with U.S. GAAP. Our calculation of Adjusted EBITDA is not necessarily comparable to that of other similarly titled measures reported by other companies.