Freightcar America, Inc. · NASDAQ:RAIL
Freightcar America — Investor Presentation (November 2014)
26 slides from Freightcar America's investor presentation, Nov 12, 2014
Slide 1: November 2014
November Exhibit 99.1
Slide 2: About Us
About Us Diverse business model — manufacturing, leasing, services Full range of railcar types, excluding tank cars Industry leader in coal cars Manufacturing facilities in Cherokee, Alabama (Shoals); Roanoke, Virginia; and Danville, Illinois Scalable and flexible operations
Slide 3: Investment Highlights
Investment Highlights New and redesigned products have provided growth opportunities and expanded access to a $2.7 billion annual railcar delivery market (excluding tank cars)* Robust environment for broad range of freight cars Coal car market leader International growth opportunities Q3 2014 backlo
Slide 4: Diversified Business Model
Coal Cars Other Open Top Hoppers and Gondolas Covered Hoppers Boxcars Intermodal Cars Non- Intermodal Flat Cars Manufacturing Parts Sales Maintenance and Repair Services Leasing Diversified Business Model
Slide 5: Diverse Customer Base
Diverse Customer Base Railroads Shippers Financial Institutions
Slide 6: Freight Cars
Freight Cars Intermodal Covered Hoppers Cement Frac sand Grain and DDG Potash and soda ash Food-grade service Plastic pellets Trucking industry issues drive modal shifts o Driver shortages o Highway congestion Expansion of Panama Canal Cost savings opportunities for shippers
Slide 7: Select Other Freight Cars
Select Other Freight Cars Bulkhead Flat World Class Engineering Capabilities Hybrid Aggregate Hopper 66-Foot Mill Gondola Steel Aggregate Hopper
Slide 8: Leader in Coal Cars
Leader in Coal Cars Aluminum Coal Car Stainless Steel/Hybrid Coal Car Aluminum 58% of total North American coal cars Primarily Western service Demand driven by electricity generation and industrial production Relatively young fleet; not expected to see meaningful demand for some time Steel 42% of to
Slide 9: Diversification Strategy - Manufacturing
Diversification Strategy - Manufacturing Investment in Shoals facility and new product development led to successful transition from reliance on coal cars to near-full range of freight car types Provides growth opportunities in strong covered hopper, intermodal and other freight car markets Diversif
Slide 10: Footprint - Shoals Facility
Footprint – Shoals Facility State-of-the-art facility subleased February 2013 On line July 2013 Initial build-out completed June New line to be added in Q2 2015 Proximity to key suppliers Flexible manufacturing capacity for a wide variety of freight cars Primary facility for non-coal cars
Slide 11: Footprint - Roanoke and Danville Facilities
Footprint – Roanoke and Danville Facilities Primary facilities for coal car manufacturing Scalable and flexible work force Low fixed costs
Slide 12: Footprint - Services
Footprint – Services 2 railcar maintenance and repair facilities • Strategically located on high- volume corridors • Servicing coal and other car types • Routine maintenance, regulatory programs, car modifications and rebuilds Parts sales for variety of car types • 2 warehouses serving high-volume P
Slide 13: Freight Car Market Overview
Freight Car Market Overview Growing freight car market • Greater demand to support growing North American energy market • Intermodal is the second largest category for loadings and revenues for railroads • Increasing North American consumption and expansion of Panama Canal • Higher demand for enviro
Slide 14: Coal Car Market Overview
Coal Car Market Overview Currently, coal constitutes 20% of loadings and gross revenues and 40% of tonnage for U.S. Class I railroads Near term, coal car demand is challenged Long-term opportunities • Coal projected to account for at least 32% of the US’s electricity generation through 2040 • U.S. c
Slide 15: Railcar Industry Delivery Forecast
Railcar Industry Delivery Forecast † Strong market demand has tightened industry capacity Strong 3-year CAGR projections (2013-2016) • Open-Top Hoppers +79% • Intermodal +53% • Gondolas +39% • Covered Hoppers +25% † September 2014 (Q3) FTR Rail Equipment Outlook *Units, North America 10,000 20,000 3
Slide 16: Complementary Services
Complementary Services Diversify Revenue Mix Increasing demand for repair services • New technologies increasing frequency of railcar repairs • Aging national coal car fleet will require increasing maintenance • New tank car regulations could tighten industry capacity Less cyclical than freight car
Slide 17: International Growth Opportunities
International Growth Opportunities Global middle-class population growth, coupled with an increasing trend toward urbanization, should drive demand for all railcar types Significant portion of world’s electricity needs will be met by coal, driving rapidly expanding coal production in countries with
Slide 18: Growth Drivers - Summary
Growth Drivers - Summary Transportation industry dynamics favor rail Long term, coal will continue to play an important role for U.S. electricity generation Growing freight car market due to increasing North American consumption and higher demand for support of energy market Maintenance and repair i
Slide 19: Company Deliveries
Company Deliveries *Reflects Company estimates of full-year deliveries 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 2014* 2015* 13,031 18,764 10,282 10,276 3,377 2,229 6,188 8,325 3,821 7,000 9,000 Projected Range 10,000
Slide 20: Growing Company Backlog
Growing Company Backlog Growth reflects diversification strategy into non-coal cars 20,729 9,315 5,399 2,424 2,054 8,303 2,881 6,826 7,727 8,493 13,514 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 22,000 24,000 Q1 Q2 Q3 Units Do
Slide 21: Revenue and Earnings History
Revenue and Earnings History Diversification strategy targets growth while mitigating cyclicality YTD 2014 revenues and earnings up significantly over 2013 $482 $927 $817 $746 $249 $143 $487 $677 $290 $386 ($50) $0 $50 $100 $150 $200 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 Q3 YTD Revenues
Slide 22: Recent Financial History
Recent Financial History Q3 2014 Y/Y revenue growth of 151% driven by unit growth Q3 2014 Y/Y operating income margin improvement a result of higher unit volume and operating leverage $75.9 $79.7 $56.1 $139.7 $190.3 $0 $50 $100 $150 $200 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Revenues -30% -24% -18% -12% - 6
Slide 23: Strong Balance Sheet
Strong Balance Sheet Cash & short-term investments of $74 million and no debt at September 30, Strong cash position maintained to manage through industry cycles Strict working capital management Pension and OPEB liabilities of $64 million at end of 2013 *See page 27 for additional information $11 $6
Slide 24: FreightCar America Outlook
FreightCar America Outlook Unit delivery projections of 7,000 for 2014 Unit delivery projections between 9,000 and 10,000 for 2015 Revenue levels are dependent on manufacturing mix (new vs. rebuild and car type)
Slide 25: Growing Shareholder Value
Growing Shareholder Value Capitalize on Diversified Product Portfolio Maintain Coal Car Market Leadership Grow Services Contribution International Market Opportunities Manage Business for the Long Term Capitalize on
Slide 26: Non-GAAP Reconciliation
Non-GAAP Reconciliation EBITDA ($ in thousands) Net income (loss) ($24,860) $45,693 $128,733 $27,459 $11,420 $4,784 ($12,862) $4,939 $19,095 ($19,295) ($7,008) $1,098 Interest income (282) (1,225) (5,860) (8,349) (3,827) (124) (89) (6) (11) (64) (59) (48) Interest expense and deferred financing cost
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