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FreightCar America, Inc. Reports Third Quarter 2009 Results

Posted by Dana in November 9th 2009

FreightCar America, Inc. (NASDAQ: RAIL) reported net income of $1.1 million, or $0.09 per diluted share, for the three months ended September 30, 2009 on revenues of $55.1 million. For the second quarter of 2009, the Company generated sales of $104.3 million and net income of $7.0 million, or $0.59 per diluted share. For the third quarter of 2008, the Company generated sales of $238 million and net income of $10.0 million, or $0.85 per diluted share.

There were no net orders for new railcars in the third quarter of 2009, compared to 694 units ordered in the second quarter of 2009, and 2,329 units ordered in the third quarter of 2008. Railcar deliveries totaled 695 units in the third quarter, compared to 1,207 units delivered in the second quarter of 2009 and 3,082 units delivered in the third quarter of 2008. Total backlog of unfilled orders was 777 units at the end of the third quarter, compared with 1,472 units at the end of the second quarter of 2009 and 4401 units at the end of the third quarter of 2008.

Cash on-hand at the end of the second quarter of 2009 was $152 million. The decrease in cash during the quarter was due to an increase in inventory due to the timing of orders and a $12.1 million pension contribution.

Selling, general and administrative expenses for the third quarter of 2009 were $6.6 million, compared to $6.7 million in the second quarter of 2009 and $7.2 million in the third quarter of 2008.

The gross margin rate for the third quarter of 2009 was 12.5% compared to 15.3% for the second quarter of 2009 and 9.5% for the third quarter of 2008. The decrease in the rate from the previous quarter was due to lower margins on new car sales. The increase in gross margin rate compared to the prior year was due to an increase in parts sales and leasing revenues, which carry higher margins than new car sales.

As of September 30, 2009, the Company’s net investment in railcars under operating leases was $62 million, compared to $71 million at the end of the second quarter of 2009 and $36 million at the end of the third quarter of 2008. Year to date, the Company has invested $91 million in new railcars under leases and generated cash proceeds from the sale of leased railcars of $76 million.