Previous Statements by RAIL
» FreightCar America, Inc. Q3 2008 Earnings Call Transcript
» FreightCar America, Inc. Q2 2008 Earnings Call Transcript
» FreightCar America, Inc. Q1 2008 Earnings Call Transcript
We expressly disclaim any duty to provide updates to our forward-looking statements whether as a result of new information, future events, or otherwise. Our 2011 Form 10-K and earnings release for the second quarter of 2012 are posted on the company's website at www.freightcaramerica.com.I would now like to turn the call over to Ed Whalen, our President and CEO. Ed Whalen Thank you, Joe and good morning. I am pleased to report another strong quarter for FreightCar America as we registered year-over-year improvements in both our top and bottom line despite significant headwinds we have been experiencing in the coal market. Revenues and operating income decreased sequentially for the first time in several quarters. However we were able to build upon the efficiencies gained over the last two years to maintain solid financial results. To recap order activity, 961 railcars were ordered in the second quarter of 2012, of which 600 were new, compared to 1089 new railcars ordered in the second quarter of 2011. In the first quarter of 2012, 1244 railcars were ordered of which 1163 were new. As a result of our product diversification efforts, our second quarter orders included a variety of car types with services other than coal including hoppers, gondolas and flat cars. We delivered 2,786 railcars in the second quarter of 2012, which included 1,815 new, 361 used and 610 leased railcars. This compares to 1,309 railcars delivered in the second quarter of 2011, of which 1,219 were new. There were 2,613 railcars delivered in the first quarter of 2012, of which 2,146 were new. Our backlog of unfulfilled orders at June 30, 2012 was 5,109 railcars compared to 4,986 railcars at June 30, 2011 and 6,934 railcars at March 31, 2012. Total industry railcar orders were 16,434 in the second quarter with tank cars accounting for 84% of all orders. 17,927 railcars were delivered in the second quarter of 2012 and as a result industry-wide backlog decreased to 58,674 railcars at the end of June.
The overall number of railcars in storage reached to roughly 318,000 as of June, an increase of 19,000 when compared to March 31, 2012. However we estimate that the number of coal cars in storage decreased from about 35,000 railcars at the end of March to approximately 33,000 at the end of June and continued to decrease further to 24,000 at the end of July.While U.S. railcar loading for most commodities remained strong, coal continued to be challenged. When compared to the second quarter of 2011, commodity loadings in the second quarter of 2012 were down 3.2% driven by coal and agricultural products. Coal loadings decreased by 11.7% and intermodal container loadings increased by 6.3% in the second quarter versus the same quarter in 2011. U.S. electricity generation where coal competes as a power generating fuel was down 2.6% in the first half of the year compared to the first half of 2011. Overall the U.S. coal production was down 6.2% in the first half of 2012 versus the same period last year. Lower natural gas prices and lower electric power consumption continued to negatively impact coal demand. Efficiency of the railroads and the anemic economic recovery also impacted overall coal demand. The Energy Information Administration's latest estimate report stockpile as of May 2012 is 203 million tons approaching the record level of 2009, 35% above the 10-year average and 16% above the year-ago stockpile level. Indications are that harder than normal summer is helping to reduce the absolute level of the utility coal stockpile, but it is difficult to say when the stockpile will return to historical average levels. Read the rest of this transcript for free on seekingalpha.com