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Section 1: 8-K (FORM 8-K)

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________

Form 8-K
_____________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event Reported): October 31, 2018  

FREIGHTCAR AMERICA, INC.
(Exact Name of Registrant as Specified in Charter)

Delaware000-5123725-1837219
(State or Other Jurisdiction of Incorporation)(Commission File Number)(I.R.S. Employer Identification Number)

 

Two North Riverside Plaza, Suite 1300, Chicago, Illinois 60606
(Address of Principal Executive Offices) (Zip Code)

(800) 458-2235
(Registrant's telephone number, including area code)

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 [ ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 [ ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 [ ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 [ ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). 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. [   ]

 
 

Section 2 Financial Information

Item 2.02. Results of Operations and Financial Condition.

On October 31, 2018, FreightCar America, Inc. issued a press release announcing its financial results for the third quarter of 2018. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information contained in Exhibit 99.1 is being furnished under Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Section 9 Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

          (d) Exhibits

Exhibit 99.1 Press release of FreightCar America, Inc., dated October 31, 2018.


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 hereunto duly authorized.

 FREIGHTCAR AMERICA, INC.
   
  
Date: October 31, 2018By: /s/ Matthew S. Kohnke        
  Matthew S. Kohnke
  Vice President Finance, Chief Financial Officer and Treasurer
  


EXHIBIT INDEX

Exhibit Number Description
   
Exhibit 99.1 Press release of FreightCar America, Inc., dated October 31, 2018.

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Section 2: EX-99.1 (PRESS RELEASE)

EdgarFiling

EXHIBIT 99.1

FreightCar America, Inc. Reports Third Quarter 2018 Results

Pricing, product mix and steel costs impact results for the quarter; Company reaffirms full year delivery estimates and targeted savings guidance from ‘Back to Basics’ program

CHICAGO, Oct. 31, 2018 (GLOBE NEWSWIRE) -- FreightCar America, Inc. (NASDAQ: RAIL) today reported results for the third quarter ended September 30, 2018.

Highlights for the Quarter

"While we continue to be very encouraged by the progress we are making in our ‘Back to Basics’ business transformation, we experienced several challenges this quarter,” said Jim Meyer, President and Chief Executive Officer of FreightCar America. "More specifically, the quarter was impacted by industry pricing that remains extremely challenging, combined with material supply constraints and higher costs. In addition, our productivity levels were temporarily impacted by major line changeovers and planned upgrades at our Shoals facility.”

Meyer concluded, “As we continue to accelerate the operational and cost reduction components of ‘Back to Basics’, we are also placing significant effort on refining and enhancing our product portfolio to more fully participate in the market. This kind of holistic transformation may generate uneven performance in the near term, but we strongly believe in the steps we are taking to position ourselves for long term success."

Third Quarter Results

Third Quarter 2018 Conference Call & Webcast Information

The Company will host a conference call and live webcast on Thursday, November 1, 2018 at 11:00 a.m. (Eastern Daylight Time) to discuss the Company’s third quarter 2018 financial results. To participate in the conference call, please dial (800) 288-8976, Confirmation Number 455937.  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#: 455937

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 November 1, 2018 until 11:59 p.m. (Eastern Standard Time) on December 1, 2018.  To access the replay, please dial (800) 475-6701.  The replay pass code is 455937.  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 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,
  2018  2017 
 (In thousands)
Assets  
Current assets  
Cash, cash equivalents and restricted cash equivalents$    32,876 $    87,788 
Restricted certificates of deposit   5,452    5,720 
Marketable securities    27,262    42,917 
Accounts receivable, net   38,886    7,581 
Inventories, net   62,693    45,292 
Inventory on lease   37,778    5,550 
Other current assets   5,453    5,099 
Total current assets   210,400    199,947 
   
Property, plant and equipment, net   47,273    38,253 
Railcars available for lease, net    27,903    23,434 
Goodwill   21,521    21,521 
Deferred income taxes, net   14,256    9,446 
Other long-term assets   3,150    3,303 
Total assets$    324,503 $    295,904 
   

Liabilities and Stockholders’ Equity
  
Current liabilities  
Accounts and contractual payables$    42,498 $    23,329 
Accrued payroll and other employee costs   1,360    1,809 
Reserve for workers’ compensation   3,616    3,394 
Accrued warranty   9,526    8,062 
Customer deposits   3,000    362 
Deferred income state and local incentives, current   2,219    2,219 
Deferred rent, current   6,466    178 
Other current liabilities   1,273    964 
Total current liabilities   69,958     40,317 
Accrued pension costs   4,914    5,763 
Accrued postretirement benefits, less current portion   5,294    5,556 
Deferred income state and local incentives, long-term   7,496    9,161 
Deferred rent, long-term   17,114    2,988 
Accrued taxes and other long-term liabilities   405    387 
Total liabilities   105,181    64,172 
   
Stockholders’ equity  
Preferred stock   —    — 
Common stock   127    127 
Additional paid in capital   89,854    90,347 
Treasury stock, at cost   (9,668)   (12,555)
Accumulated other comprehensive loss   (7,459)   (7,567)
Retained earnings   146,468    161,380 
Total stockholders’ equity   219,322    231,732 
Total liabilities and stockholders’ equity$    324,503 $    295,904 


 
FreightCar America, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
 
 Three Months Ended
September 30,
 Nine Months Ended
September 30,
  2018  2017   2018  2017 
 (In thousands, except for share and per share data)
      
Revenues$78,968 $72,025  $228,684 $330,233 
Cost of sales 82,806  79,947   228,279  323,104 
Gross (loss) profit (3,838) (7,922)  405  7,129 
Selling, general and administrative expenses 5,448  10,734   21,829  23,686 
Gain on sale of facility (573)    (573)  
Restructuring and impairment charges   59     1,785 
Operating loss (8,713) (18,715)  (20,851) (18,342)
              
Interest expense and deferred financing costs (26) (27)  (85) (99)
Other income 452  335   1,421  219 
Loss before income taxes (8,287) (18,407)  (19,515) (18,222)
Income tax benefit (2,115) (6,793)  (4,603) (6,798)
Net loss(6,172)$(11,614) $(14,912)$(11,424)
              
Net loss per common share – basic$(0.50)$(0.94) $(1.20)$(0.92)
              
Net loss per common share – diluted$(0.50)$(0.94) $(1.20)$(0.92)
              
Weighted average common shares outstanding -             
basic 12,325,718  12,293,998   12,316,497  12,282,522 
              
Weighted average common shares outstanding -             
diluted 12,325,718  12,293,998   12,316,497  12,282,522 
              
Dividends declared per common share$ $0.09  $ $0.27 
              


 
FreightCar America, Inc.
Segment Data
(Unaudited)
 
 Three Months Ended
September 30,
 Nine Months Ended
September 30,
  2018  2017   2018  2017 
 (In thousands) (In thousands)
Revenues:     
Manufacturing$  75,162 $   69,842  $  217,946 $  323,649 
Corporate and Other   3,806    2,183     10,738    6,584 
  Consolidated revenues$  78,968 $   72,025   $  228,684 $  330,233 
      
Operating loss:     
Manufacturing$  (5,906)$  (10,028) $  (8,014)$  (451)
Corporate and Other   (2,807)   (8,687)    (12,837)   (17,891)
  Consolidated operating loss$  (8,713)$  (18,715) $  (20,851)$  (18,342 )


 
FreightCar America, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
 
 Nine Months Ended
September 30,
  2018  2017 
 (In thousands)
Cash flows from operating activities  
   
Net loss$  (14,912)$  (11,424)
Adjustments to reconcile net loss to net cash
flows (used in) provided by operating activities: 
    
Net proceeds from Shoals transaction   2,655    — 
Depreciation and amortization   8,341    7,021 
Recognition of deferred income from state and local incentives   (1,665)   (1,664)
Gain on sale of facility   (573)   — 
Deferred income taxes   (4,840)   (7,489)
Stock-based compensation recognized   2,511    566 
Other non-cash items, net    313    610 
Changes in operating assets and liabilities, net of acquisitions:  
  Accounts receivable   (31,305)   6,699 
Inventories   (14,465)     27,074 
Inventory on lease   (32,228)   — 
Other assets    406     1,795 
Accounts and contractual payables   18,159    (2,424)
Accrued payroll and employee benefits   (449)   (955)
Income taxes receivable/payable   814    12,566 
Accrued warranty   1,464    (444)
Other liabilities    (604)   (727)
Accrued pension costs and accrued postretirement benefits   (1,003)   (288)
Net cash flows (used in) provided by operating activities   (67,381)    30,916 
   
Cash flows from investing activities  
   
Purchase of restricted certificates of deposit   (4,952)    (6,106)
Maturity of restricted certificates of deposit   5,220    2,636 
Purchase of securities held to maturity (101,356) (63,895)
Proceeds from maturity of securities     117,442    13,000 
Cost of railcars available for lease   (5,119)   — 
Purchases of property, plant and equipment     (1,107)   (613)
Proceeds from sale of property, plant and equipment and railcars available for lease      2,458    119 
State and local incentives received    —    1,410 
Net cash flows provided by (used in) investing activities      12,586    (53,449)
   
Cash flows from financing activities  
   
Employee stock settlement   (117)   (19)
Cash dividends paid to stockholders   —    (3,351)
Net cash flows used in financing activities   (117 )   (3,370)
   
Net decrease in cash and cash equivalents$    (54,912)$  (25,903)
Cash, cash equivalents and restricted cash equivalents at beginning of period$    87,788 $  96,110 
Cash, cash equivalents and restricted cash equivalents at end of period$   32,876 $  70,207 
   


INVESTOR & MEDIA CONTACTMatthew S. Kohnke
TELEPHONE(800) 458-2235

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