FreightCar America 3Q profit craters, to cut jobs

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CHICAGO -FreightCar America Inc. said Friday its third-quarter profit plunged 89 percent as railcar demand plummeted during the recession. It said it will cut additional jobs and spending given the weak outlook for the railcar market.

The railroad freight car maker said it received no orders for new railcars in the third quarter. That compares with 694 orders in the previous quarter and 2,329 orders in the third quarter of last year.

"The decline in order activity in the quarter illustrates that the market for new railcars remains very challenging," President and CEO Chris Ragot said in a statement.

"We believe that patience will be rewarded as the railcar market continues to be soft, and we will be prudent in investing in opportunities as they present themselves," he said.

Third-quarter results missed analyst expectations, and FreightCar America shares tumbled $4.04, or 15.8 percent, to $21.56 in morning trading. The stock has ranged from $14.05 to $27.08 over the past year.

FreightCar America said its profit for the three months ended Sept. 30 fell to $1.1 million, or 9 cents per share. The company earned $10 million, or 85 cents per share, in the same quarter last year.

Revenue plunged 77 percent to $55.1 million from $238 million.

Analysts surveyed by Thomson Reuters expected a profit of 22 cents per share on $78 million in sales.

FreightCar America did not specify how many jobs would be cut. It said there is "little visibility" toward a recovery in the market and cash preservation will remain a high priority. The company said it ended the quarter with $134 million in cash and on-hand investments and had two undrawn credit facilities.

2009-11-06 10:01:40