LOS ANGELES FreightCar America Inc. is looking to diversify outside of coal cars with a new plant in Alabama after rail car shipments plunged in the second quarter.
The Chicago-based rail car builder delivered 710 units in the three months ended June 30, down 33.8 percent from 1,073 cars in the first quarter and 74.5 percent from 2,786 cars a year ago.
It posted a second-quarter net loss of nearly $3.44 million in contrast to net income of $5.56 million in the same period last year on revenue that fell 74 percent to $47.11 million. A first-half net loss of $6.08 million was in contrast to net income of $15.3 million a year earlier as revenue tumbled 66.3 percent to $134.72 million.
"Given the ongoing weakness in our traditional freight rail car market, we continue to focus on the diversification of our product offerings, as exemplified by the successful startup of the Shoals, Ala., facility to produce non-coal cars and the improving returns of our services business," said chief executive officer Ed Whalen.
The companys manufacturing segment had an operating loss of $1.01 million on revenue of $37.06 million in the second quarter vs. operating earnings of $15.25 million on sales of $171.77 million a year earlier. Its smaller services segment had operating earnings of $1.61 million on revenue of $10.05 million vs. operating earnings of $726,000 on revenue of $9.44 million in the same comparison.
Orders for 693 units, including one for the companys recently introduced intermodal well cars, were received in the second quarter compared with orders for 274 cars in the first quarter and 961 cars a year ago. However, after the second quarter ended FreightCar America said it received orders for more than 5,500 cars, of which 4,000 were for rebuilt coal cars for the Eastern market.
FreightCar Americas manufacturing backlog totaled 2,065 rail cars at the end of June compared with 2,082 units three months earlier and 5,109 a year ago.
FreightCar America claims to account for 70 percent of the U.S. coal rail car market and also a leading share of aluminum cars. U.S. coal rail car loadings in the first seven months of 2013 were off 4.5 percent from last year, while loadings of petroleum and petroleum products were up 44.7 percent, according to the Association of American Railroads.