For third-quarter 2021, FreightCar America, Inc., reported achieving its fourth consecutive quarter of positive gross margin and second consecutive quarter of positive manufacturing operating income—despite a “difficult” railcar model launch—and reiterated its 2021 delivery outlook.
For the three months ended Sept. 30, 2021, FreightCar America revenue came in at $58.3 million on deliveries of 505 railcars, representing a 55.9% increase from second-quarter 2021’s $37.4 million with 313 railcars delivered, and a 131.3% jump from third-quarter 2020’s $25.2 million with 163 railcars delivered.
Quarter-end backlog totaled 1,895 railcars with an aggregate value of approximately $198 million. FreightCar America reiterated its 2021 delivery outlook of between 1,750 and 1,850 railcars.
Gross margin for the third-quarter was $1.5 million and manufacturing operating income was $0.2 million.
FreightCar America reported that both consolidated operating loss and net income/loss for third-quarter 2021 and the prior period included “non-operating items that impacted results, including: non-cash charge of $0.3 million related to the change in the fair market value of warrant liability in the third quarter of 2021, reflecting the company’s share price appreciation during the period. In the second quarter of 2021, there was a non-cash gain of $3.5 million, reflecting the company’s share price depreciation during the period.” Additionally, FreightCar America “recognized a gain on extinguishment of debt of $10.1 million related to PPP Loan forgiveness during the third quarter of 2021.”
Consolidated operating loss for third-quarter 2021 came in at ($4.2) million, compared with an operating loss of ($4.2) million in second-quarter 2021 and operating loss of ($41.3) million in third-quarter 2020.
Net income in third-quarter 2021 was $0.7 million, or $0.03 per share, vs. net loss of ($4.2) million, or ($0.24) per share, in second-quarter 2021, and net loss of ($40.3) million, or ($3.03) per share, in third-quarter 2020.
Adjusted EBITDA loss for third-quarter 2021 was ($3.5) million, compared with Adjusted EBITDA loss of ($3.1) million for second-quarter 2021 and ($8.0) million for third-quarter 2020.
“Overall, we are pleased with FreightCar America’s continuing momentum, including our fourth consecutive quarter of positive gross margin,” FreightCar America President and CEO Jim Meyer said. “However, our results for the quarter were impacted by the difficult launch of a new railcar model. That event aside, which is now well behind us, we wholeheartedly believe in the business transformation we’ve completed and remain focused on returning to long-term growth and profitability.
“While industry demand fundamentals remain strong, the pace of recovery is being gated by certain external factors starting with raw material cost inflation. Sales inquiries, however, continue to be very healthy and support our footprint expansion announced earlier this year.
“We are also pleased to announce that subsequent to quarter-end, we received a portion of the outstanding VAT receivable in Mexico. As of today [Nov. 15], we have received $10.2 million of the outstanding VAT receivable, which was $30.1 million on September 30, 2021.”