This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

American Railcar Industries' CEO Discusses Q2 2012 Results - Earnings Call Transcript

There has been a recent slowdown of orders for covered hoppers and railcar builders are managing production rates to focus on fulfilling orders in the existing backlog. A recent report by the Chemical Weekly indicated that significant new ethanol capacity in the form of new plants will be coming online between 2013 and 2017. These new plants are expected to add over 20 billion pounds of capacity to the market. We expect this will generate new orders for classic covered hopper railcars as the industry currently has a shortage of this railcar type.

ARI’s backlog continues to remain strong with 6,800 railcars on order for both sale and lease at the end of June. We received orders for approximately 2,810 railcars during the second quarter of 2012. At the end of June, we had approximately 1,620 railcars in our backlog to be manufactured for our lease customers.

We continue to heavily invest in our railcar lease fleet, offering to our customers another avenue to use our quality products. We have booked our first hopper orders to be delivered in the first quarter of 2013 and we’re quoting new tank car railcar orders for delivery in late 2013 and into 2014.

We continue to benefit from vertical integration projects that we put in place over the past several years significantly improving margins as production volumes have reached higher levels. These projects included internally manufactured tank heads, railcar axels and castings producing other railcar fabricated components and assembling our own wheel sets.

During the past 18 to 24 months, we have hired a significant number of employees to ramp our production to current levels. These workers have been well trained and are working efficiently. Our railcar manufacturing facilities are in close proximity giving us the additional flexibility to move workers between hopper and tank railcar manufacturing plants as demand requires.

3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs