Posting loss, FreightCar America sees signs of turnaround
Written by William C. Vantuono, Editor-in-Chief FreightCar America, Inc has reported second quarter 2010 revenues of $31.0 million and a net loss of $1.3 million, or 11 cents a share. This compares with revenues of $104.3 million and net income of $7.0 million, or 59 cents per a share, in second quarter 2009.
The company delivered 614 railcars in the second quarter of 2010, consisting of 160 new cars, 440 used and 14 cars delivered under leases. This compares to 321 railcars delivered in the first quarter of 2010 and 1,109 in the second quarter of 2009.
Orders for railcars were 14 units in the second quarter of 2010, compared to 3,656 units in the first quarter of 2010 and 694 units in the second quarter of 2009. Total backlog was 3,000 units at June 30, 2010 compared to 3,600 at March 31, 2010.
"Our sales and order volume for the second quarter of 2010 reflects the continuing low level of demand for coal-carrying railcars," said Ed Whalen, President and Chief Executive Officer. "However, our results for the second quarter benefited from a favorable sales mix and our on-going efforts to control spending."
Whalen also said: "We have begun to see some initial signs of improvement in the market that we believe could lead to increased demand for coal-carrying railcars. Year-over-year electricity generation and coal loadings continue to improve, coal stockpiles are down compared to the prior year and railcars continue to come out of storage. However, as you can see from our level of new orders in the quarter, demand has not yet improved and customers continue to remain cautious, which gives us little visibility regarding the timing of an industry recovery and a return to more normalized levels of demand. Looking forward, we expect railcar pricing to continue to be very competitive, keeping downward pressure on margins until volume recovers to more normalized levels."
