|
|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
North Dakota
|
|
43-1481791
|
(State of
Incorporation)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
100 Clark Street, St. Charles, Missouri
|
|
63301
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
Large accelerated filer
|
¨
|
Accelerated filer
|
x
|
|
|
|
|
Non-accelerated filer
|
¨
|
Smaller Reporting Company
|
¨
|
|
Item Number
|
Page
Number
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit 31.1
|
|
Exhibit 31.2
|
|
Exhibit 32.1
|
|
EX-101 INSTANCE DOCUMENT
|
|
EX-101 SCHEMA DOCUMENT
|
|
EX-101 CALCULATION LINKBASE DOCUMENT
|
|
EX-101 LABELS LINKBASE DOCUMENT
|
|
EX-101 PRESENTATION LINKBASE DOCUMENT
|
|
EX-101 DEFINITION LINKBASE DOCUMENT
|
|
|
March 31,
2014 |
|
December 31,
2013 |
||||
|
(unaudited)
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
154,488
|
|
|
$
|
97,252
|
|
Restricted cash
|
7,277
|
|
|
3,908
|
|
||
Accounts receivable, net
|
62,742
|
|
|
21,939
|
|
||
Accounts receivable, due from related parties
|
15,308
|
|
|
16,402
|
|
||
Inventories, net
|
106,012
|
|
|
90,185
|
|
||
Deferred tax assets
|
7,688
|
|
|
9,060
|
|
||
Prepaid expenses and other current assets
|
6,460
|
|
|
6,500
|
|
||
Total current assets
|
359,975
|
|
|
245,246
|
|
||
Property, plant and equipment, net
|
158,269
|
|
|
159,375
|
|
||
Railcars on operating leases, net
|
413,168
|
|
|
372,551
|
|
||
Deferred debt issuance costs
|
2,445
|
|
|
2,026
|
|
||
Goodwill
|
7,169
|
|
|
7,169
|
|
||
Investments in and loans to joint ventures
|
29,684
|
|
|
31,430
|
|
||
Other assets
|
4,064
|
|
|
7,812
|
|
||
Total assets
|
$
|
974,774
|
|
|
$
|
825,609
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
63,190
|
|
|
$
|
52,772
|
|
Accounts payable, due to related parties
|
1,917
|
|
|
1,410
|
|
||
Accrued expenses and taxes
|
22,358
|
|
|
20,216
|
|
||
Accrued compensation
|
16,592
|
|
|
16,071
|
|
||
Short-term debt, including current portion of long-term debt
|
10,612
|
|
|
6,655
|
|
||
Total current liabilities
|
114,669
|
|
|
97,124
|
|
||
Long-term debt, net of current portion
|
306,301
|
|
|
188,103
|
|
||
Deferred tax liability
|
101,749
|
|
|
99,212
|
|
||
Pension and post-retirement liabilities
|
4,343
|
|
|
4,718
|
|
||
Other liabilities
|
2,006
|
|
|
2,550
|
|
||
Total liabilities
|
529,068
|
|
|
391,707
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $0.01 par value, 50,000,000 shares authorized, 21,352,297 shares issued and outstanding as of both March 31, 2014 and December 31, 2013
|
213
|
|
|
213
|
|
||
Additional paid-in capital
|
239,609
|
|
|
239,609
|
|
||
Retained earnings
|
207,803
|
|
|
195,574
|
|
||
Accumulated other comprehensive loss
|
(1,919
|
)
|
|
(1,494
|
)
|
||
Total stockholders’ equity
|
445,706
|
|
|
433,902
|
|
||
Total liabilities and stockholders’ equity
|
$
|
974,774
|
|
|
$
|
825,609
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Revenues:
|
|
|
|
||||
Manufacturing (including revenues from affiliates of $41,235 and $63,078 for the three months ended March 31, 2014 and 2013, respectively)
|
$
|
153,963
|
|
|
$
|
172,975
|
|
Railcar Leasing
|
11,746
|
|
|
6,543
|
|
||
Railcar Services (including revenues from affiliates of $3,963 and $4,608 for the three months ended March 31, 2014 and 2013, respectively)
|
16,406
|
|
|
15,592
|
|
||
Total revenues
|
182,115
|
|
|
195,110
|
|
||
Cost of revenues:
|
|
|
|
||||
Manufacturing
|
(118,365
|
)
|
|
(137,123
|
)
|
||
Railcar Leasing
|
(4,491
|
)
|
|
(2,904
|
)
|
||
Railcar Services
|
(13,365
|
)
|
|
(12,589
|
)
|
||
Total cost of revenues
|
(136,221
|
)
|
|
(152,616
|
)
|
||
Gross profit
|
45,894
|
|
|
42,494
|
|
||
Selling, general and administrative
|
(9,387
|
)
|
|
(11,265
|
)
|
||
Earnings from operations
|
36,507
|
|
|
31,229
|
|
||
Interest income (including income from related parties of $627 and $681 for the three months ended March 31, 2014 and 2013, respectively)
|
641
|
|
|
691
|
|
||
Interest expense
|
(1,672
|
)
|
|
(3,000
|
)
|
||
Loss on debt extinguishment
|
(1,896
|
)
|
|
(392
|
)
|
||
Other income
|
5
|
|
|
1,996
|
|
||
Loss from joint ventures
|
(601
|
)
|
|
(973
|
)
|
||
Earnings before income taxes
|
32,984
|
|
|
29,551
|
|
||
Income tax expense
|
(12,214
|
)
|
|
(11,614
|
)
|
||
Net earnings
|
$
|
20,770
|
|
|
$
|
17,937
|
|
Net earnings per common share—basic and diluted
|
$
|
0.97
|
|
|
$
|
0.84
|
|
Weighted average common shares outstanding—basic and diluted
|
21,352
|
|
|
21,352
|
|
||
Cash dividends declared per common share
|
$
|
0.40
|
|
|
$
|
0.25
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Net earnings
|
$
|
20,770
|
|
|
$
|
17,937
|
|
Currency translation
|
(459
|
)
|
|
(248
|
)
|
||
Postretirement plans
|
55
|
|
|
47
|
|
||
Short-term investments
|
—
|
|
|
(1,213
|
)
|
||
Comprehensive income
|
$
|
20,366
|
|
|
$
|
16,523
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
Operating activities:
|
|
|
|
||||
Net earnings
|
$
|
20,770
|
|
|
$
|
17,937
|
|
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation
|
7,683
|
|
|
6,535
|
|
||
Amortization of deferred costs
|
109
|
|
|
183
|
|
||
Loss on disposal of property, plant and equipment
|
45
|
|
|
—
|
|
||
Loss from joint ventures
|
601
|
|
|
973
|
|
||
Provision for deferred income taxes
|
3,892
|
|
|
10,287
|
|
||
Adjustment to allowance for doubtful accounts receivable
|
31
|
|
|
(12
|
)
|
||
Items related to investing activities:
|
|
|
|
||||
Realized and unrealized gains on short-term investments - available for sale securities
|
—
|
|
|
(141
|
)
|
||
Items related to financing activities:
|
|
|
|
||||
Loss on debt extinguishment
|
1,896
|
|
|
392
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
(40,846
|
)
|
|
3,754
|
|
||
Accounts receivable, due from related parties
|
1,035
|
|
|
(10,128
|
)
|
||
Inventories, net
|
(15,874
|
)
|
|
23,793
|
|
||
Prepaid expenses and other current assets
|
(3,243
|
)
|
|
(2,877
|
)
|
||
Accounts payable
|
10,423
|
|
|
(20,441
|
)
|
||
Accounts payable, due to related parties
|
507
|
|
|
(2,061
|
)
|
||
Accrued expenses and taxes
|
2,679
|
|
|
(4,572
|
)
|
||
Other
|
2,883
|
|
|
(5,046
|
)
|
||
Net cash (used in) provided by operating activities
|
(7,409
|
)
|
|
18,576
|
|
||
Investing activities:
|
|
|
|
||||
Purchases of property, plant and equipment
|
(3,585
|
)
|
|
(6,141
|
)
|
||
Capital expenditures - leased railcars
|
(43,947
|
)
|
|
(43,619
|
)
|
||
Proceeds from the sale of short-term investments - available for sale securities
|
—
|
|
|
12,699
|
|
||
Proceeds from repayments of loans by joint ventures
|
1,125
|
|
|
500
|
|
||
Investments in and loans to joint ventures
|
—
|
|
|
(136
|
)
|
||
Net cash used in investing activities
|
(46,407
|
)
|
|
(36,697
|
)
|
||
Financing activities:
|
|
|
|
||||
Repayments of long-term debt
|
(196,527
|
)
|
|
(175,328
|
)
|
||
Proceeds from long-term debt
|
318,682
|
|
|
50,000
|
|
||
Change in interest reserve related to long-term debt
|
(87
|
)
|
|
—
|
|
||
Payment of common stock dividends
|
(8,541
|
)
|
|
(5,338
|
)
|
||
Debt issuance costs
|
(2,403
|
)
|
|
(212
|
)
|
||
Net cash provided by (used in) financing activities
|
111,124
|
|
|
(130,878
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(72
|
)
|
|
(42
|
)
|
||
Increase (Decrease) in cash and cash equivalents
|
57,236
|
|
|
(149,041
|
)
|
||
Cash and cash equivalents at beginning of period
|
97,252
|
|
|
205,045
|
|
||
Cash and cash equivalents at end of period
|
$
|
154,488
|
|
|
$
|
56,004
|
|
•
|
Level 1 — Quoted prices are available in active markets for identical assets and/or liabilities as of the reporting date. The type of assets and/or liabilities categorized as Level 1 includes listed equities and listed derivatives. The Company does not adjust the quoted price for these assets and/or liabilities, even in situations where they hold a large position and a sale could reasonably impact the quoted price.
|
•
|
Level 2 — Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies. Assets and/or liabilities that are generally included in this category include corporate bonds and loans, less liquid and restricted equity securities and certain over-the-counter derivatives.
|
•
|
Level 3 — Pricing inputs are unobservable for the assets and/or liabilities and include situations where there is little, if any, market activity for the assets and/or liabilities. The inputs into the determination of fair value require significant management judgment or estimation.
|
•
|
Cash and cash equivalents, restricted cash, accounts receivable, amounts due to/from affiliates, accounts payable and accrued expenses approximate fair values because of the short maturity or the liquid nature of these instruments.
|
•
|
Available for sale securities fair value estimates are based on quoted prices with an active trading market (Level 1).
|
•
|
Term Loan fair value estimates are based upon estimates by various banks determined by trading levels on the date of measurement using a Level 2 fair value measurement as defined by U.S. GAAP under the fair value hierarchy. The fair value of the Company's borrowings under its lease fleet financing facility was
$316.9 million
and
$194.8 million
as of
March 31, 2014
and
December 31, 2013
, respectively.
|
|
March 31,
2014 |
|
December 31,
2013 |
||||
|
(in thousands)
|
||||||
Accounts receivable, gross
|
$
|
62,882
|
|
|
$
|
22,048
|
|
Less allowance for doubtful accounts
|
(140
|
)
|
|
(109
|
)
|
||
Total accounts receivable, net
|
$
|
62,742
|
|
|
$
|
21,939
|
|
|
March 31,
2014 |
|
December 31,
2013 |
||||
|
(in thousands)
|
||||||
Raw materials
|
$
|
66,283
|
|
|
$
|
63,319
|
|
Work-in-process
|
25,784
|
|
|
19,975
|
|
||
Finished products
|
16,502
|
|
|
9,205
|
|
||
Total inventories
|
108,569
|
|
|
92,499
|
|
||
Less reserves
|
(2,557
|
)
|
|
(2,314
|
)
|
||
Total inventories, net
|
$
|
106,012
|
|
|
$
|
90,185
|
|
|
March 31,
2014 |
|
December 31,
2013 |
||||
|
(in thousands)
|
||||||
Operations / Corporate:
|
|
|
|
||||
Buildings
|
$
|
155,611
|
|
|
$
|
155,937
|
|
Machinery and equipment
|
186,430
|
|
|
186,844
|
|
||
Land
|
3,335
|
|
|
3,335
|
|
||
Construction in process
|
17,073
|
|
|
14,487
|
|
||
|
362,449
|
|
|
360,603
|
|
||
Less accumulated depreciation
|
(204,180
|
)
|
|
(201,228
|
)
|
||
Property, plant and equipment, net
|
$
|
158,269
|
|
|
$
|
159,375
|
|
Railcar Leasing:
|
|
|
|
||||
Railcars on operating leases
|
$
|
432,008
|
|
|
$
|
388,060
|
|
Less accumulated depreciation
|
(18,840
|
)
|
|
(15,509
|
)
|
||
Railcars on operating leases, net
|
$
|
413,168
|
|
|
$
|
372,551
|
|
Remaining 9 months of 2014
|
$
|
38,219
|
|
2015
|
50,545
|
|
|
2016
|
48,779
|
|
|
2017
|
34,920
|
|
|
2018
|
23,559
|
|
|
2019 and thereafter
|
39,305
|
|
|
Total
|
$
|
235,327
|
|
|
Three Months Ended
|
||||||
|
March 31,
|
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Total depreciation expense
|
$
|
7,683
|
|
|
$
|
6,535
|
|
Depreciation expense on leased railcars
|
$
|
3,331
|
|
|
$
|
2,055
|
|
|
March 31,
2014 |
|
December 31,
2013 |
||||
|
(in thousands)
|
||||||
Carrying amount of investments in and loans to joint ventures
|
|
|
|
||||
Ohio Castings
|
$
|
7,188
|
|
|
$
|
7,378
|
|
Axis
|
22,496
|
|
|
24,052
|
|
||
Total investments in and loans to joint ventures
|
$
|
29,684
|
|
|
$
|
31,430
|
|
|
Three Months Ended
March 31, |
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Results of operations
|
|
|
|
||||
Revenues
|
$
|
14,009
|
|
|
$
|
14,488
|
|
Gross profit
|
$
|
147
|
|
|
$
|
390
|
|
Net loss
|
$
|
(569
|
)
|
|
$
|
(233
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Results of operations
|
|
|
|
||||
Revenues
|
$
|
14,851
|
|
|
$
|
10,942
|
|
Gross profit
|
$
|
312
|
|
|
$
|
157
|
|
Income (loss) before interest
|
$
|
72
|
|
|
$
|
(75
|
)
|
Net loss
|
$
|
(1,191
|
)
|
|
$
|
(1,443
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Liability, beginning of period
|
$
|
1,385
|
|
|
$
|
1,374
|
|
Provision for warranties issued during the year, net of
adjustments
|
289
|
|
|
310
|
|
||
Adjustments to warranties issued during previous
years
|
(37
|
)
|
|
(353
|
)
|
||
Warranty claims
|
(139
|
)
|
|
(111
|
)
|
||
Liability, end of period
|
$
|
1,498
|
|
|
$
|
1,220
|
|
Remaining 9 months of 2014
|
$
|
27,178
|
|
2015
|
35,895
|
|
|
2016
|
35,107
|
|
|
2017
|
26,458
|
|
|
2018
|
17,009
|
|
|
2019 and thereafter
|
31,703
|
|
|
Total
|
$
|
173,350
|
|
Remaining 9 months of 2014
|
$
|
7,959
|
|
2015
|
10,612
|
|
|
2016
|
10,612
|
|
|
2017
|
10,612
|
|
|
2018
|
13,703
|
|
|
2019 and thereafter
|
263,415
|
|
|
Total
|
$
|
316,913
|
|
|
Pension Benefits
|
||||||
|
Three Months Ended
March 31, |
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Service cost
|
$
|
57
|
|
|
$
|
49
|
|
Interest cost
|
243
|
|
|
221
|
|
||
Expected return on plan assets
|
(313
|
)
|
|
(279
|
)
|
||
Amortization of net actuarial loss/prior service cost
|
69
|
|
|
194
|
|
||
Net periodic cost recognized
|
$
|
56
|
|
|
$
|
185
|
|
|
Postretirement Benefits
|
||||||
|
Three Months Ended
March 31, |
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Service cost
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost
|
1
|
|
|
1
|
|
||
Amortization of net actuarial gain/prior service credit
|
(14
|
)
|
|
(117
|
)
|
||
Net periodic benefit recognized
|
$
|
(13
|
)
|
|
$
|
(116
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2014
|
|
2013
|
||||
|
(in thousands)
|
||||||
Share-based compensation expense
|
|
|
|
||||
Cost of revenues: Manufacturing
|
$
|
856
|
|
|
$
|
1,032
|
|
Cost of revenues: Railcar services
|
278
|
|
|
285
|
|
||
Selling, general and administrative
|
2,872
|
|
|
4,691
|
|
||
Total share-based compensation expense
|
$
|
4,006
|
|
|
$
|
6,008
|
|
|
Accumulated
Short-term
Investment
Transactions
|
|
Accumulated
Currency
Translation
|
|
Accumulated
Postretirement
Transactions
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance December 31, 2012
|
$
|
1,213
|
|
|
$
|
1,562
|
|
|
$
|
(3,162
|
)
|
|
$
|
(387
|
)
|
Currency translation
|
—
|
|
|
(248
|
)
|
|
—
|
|
|
(248
|
)
|
||||
Unrealized gain on available for sale securities, net of tax effect $51
|
93
|
|
|
—
|
|
|
—
|
|
|
93
|
|
||||
Reclassifications related to pension and postretirement plans, net of tax effect of $30 (1)
|
—
|
|
|
—
|
|
|
47
|
|
|
47
|
|
||||
Reclassifications related to available for sale securities, net of tax effect of $702 (2)
|
$
|
(1,306
|
)
|
|
$
|
—
|
|
|
—
|
|
|
$
|
(1,306
|
)
|
|
Balance March 31, 2013
|
$
|
—
|
|
|
$
|
1,314
|
|
|
$
|
(3,115
|
)
|
|
$
|
(1,801
|
)
|
|
|
|
|
|
|
|
|
||||||||
Balance December 31, 2013
|
$
|
—
|
|
|
$
|
760
|
|
|
(2,254
|
)
|
|
$
|
(1,494
|
)
|
|
Currency translation
|
—
|
|
|
(459
|
)
|
|
—
|
|
|
(459
|
)
|
||||
Reclassifications related to pension and
postretirement plans, net of tax effect of $21 (1)
|
—
|
|
|
—
|
|
|
34
|
|
|
34
|
|
||||
Balance March 31, 2014
|
$
|
—
|
|
|
$
|
301
|
|
|
(2,220
|
)
|
|
$
|
(1,919
|
)
|
(1)—
|
These accumulated other comprehensive income components relate to amortization of actuarial loss/(gain) and prior period service costs/(benefits) and are included in the computation of net periodic costs for our pension and postretirement plans. See Note 12 for further details and pre-tax amounts.
|
(2)—
|
This accumulated other comprehensive income component relates to realized gains on available for sale securities sold. See Note 3 for further details and pre-tax amounts.
|
|
Revenues
|
|
Earnings (Loss) from Operations
|
||||||||||||||||||||
|
External
|
|
Intersegment
|
|
Total
|
|
External
|
|
Intersegment
|
|
Total
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Three Months Ended March 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Manufacturing
|
$
|
153,963
|
|
|
$
|
64,029
|
|
|
$
|
217,992
|
|
|
$
|
33,655
|
|
|
$
|
19,730
|
|
|
$
|
53,385
|
|
Railcar Leasing
|
11,746
|
|
|
—
|
|
|
11,746
|
|
|
6,230
|
|
|
31
|
|
|
6,261
|
|
||||||
Railcar Services
|
16,406
|
|
|
132
|
|
|
16,538
|
|
|
2,181
|
|
|
38
|
|
|
2,219
|
|
||||||
Corporate/Eliminations
|
—
|
|
|
(64,161
|
)
|
|
(64,161
|
)
|
|
(5,559
|
)
|
|
(19,799
|
)
|
|
(25,358
|
)
|
||||||
Total Consolidated
|
$
|
182,115
|
|
|
$
|
—
|
|
|
$
|
182,115
|
|
|
$
|
36,507
|
|
|
$
|
—
|
|
|
$
|
36,507
|
|
Three Months Ended March 31, 2013
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Manufacturing
|
$
|
172,975
|
|
|
$
|
55,408
|
|
|
$
|
228,383
|
|
|
$
|
33,979
|
|
|
$
|
9,782
|
|
|
$
|
43,761
|
|
Railcar Leasing
|
6,543
|
|
|
—
|
|
|
6,543
|
|
|
2,163
|
|
|
4
|
|
|
2,167
|
|
||||||
Railcar Services
|
15,592
|
|
|
49
|
|
|
15,641
|
|
|
2,305
|
|
|
43
|
|
|
2,348
|
|
||||||
Corporate/Eliminations
|
—
|
|
|
(55,457
|
)
|
|
(55,457
|
)
|
|
(7,218
|
)
|
|
(9,829
|
)
|
|
(17,047
|
)
|
||||||
Total Consolidated
|
$
|
195,110
|
|
|
$
|
—
|
|
|
$
|
195,110
|
|
|
$
|
31,229
|
|
|
$
|
—
|
|
|
$
|
31,229
|
|
Total Assets
|
March 31,
2014 |
|
December 31,
2013 |
||||
|
(in thousands)
|
||||||
Manufacturing
|
$
|
347,530
|
|
|
$
|
298,951
|
|
Railcar Leasing
|
541,311
|
|
|
478,000
|
|
||
Railcar Services
|
56,636
|
|
|
52,150
|
|
||
Corporate/Eliminations
|
29,297
|
|
|
(3,492
|
)
|
||
Total Consolidated
|
$
|
974,774
|
|
|
$
|
825,609
|
|
|
Three Months Ended
March 31, |
||||
|
2014
|
|
2013
|
||
Manufacturing
|
22.6
|
%
|
|
32.3
|
%
|
Railcar Leasing
|
—
|
%
|
|
—
|
%
|
Railcar Services
|
2.2
|
%
|
|
2.4
|
%
|
|
Three Months Ended
March 31, |
||||
|
2014
|
|
2013
|
||
Manufacturing revenues from significant customers
|
41.4
|
%
|
|
73.7
|
%
|
|
March 31,
2014 |
|
December 31,
2013 |
||
Manufacturing receivables from significant customers
|
20.6
|
%
|
|
35.1
|
%
|
•
|
any financial or other information included herein based upon or otherwise incorporating judgments or estimates based upon future performance or events;
|
•
|
the impact of an economic downturn, adverse market conditions and restricted credit markets;
|
•
|
our prospects in light of the cyclical nature of our business;
|
•
|
the health of and prospects for the overall railcar industry;
|
•
|
the highly competitive nature of the manufacturing, railcar leasing and railcar services industries;
|
•
|
our reliance upon a small number of customers that represent a large percentage of our revenues and backlog;
|
•
|
the conversion of our railcar backlog into revenues;
|
•
|
our ability to manage overhead and variations in production rates;
|
•
|
fluctuations in the costs of raw materials, including steel and railcar components, and delays in the delivery of such raw materials and components;
|
•
|
fluctuations in the supply of components and raw materials we use in railcar manufacturing;
|
•
|
the ongoing benefits and risks related to our relationship with Mr. Carl Icahn, the chairman of our board of directors and, through Icahn Enterprises L.P. (IELP), our principal beneficial stockholder, and certain of his affiliates;
|
•
|
anticipated production schedules for our products and the anticipated capital needs, and production schedules of our joint ventures;
|
•
|
the risks associated with our current joint ventures;
|
•
|
the risks, impact and anticipated benefits associated with potential joint ventures, acquisitions or new business endeavors;
|
•
|
the risk of the lack of acceptance of new railcar offerings by our customers and the risk of initial production costs for our new railcar offerings being significantly higher than expected;
|
•
|
the sufficiency of our liquidity and capital resources;
|
•
|
the risk of being unable to market or remarket railcars for sale or lease at favorable prices or on favorable terms or at all;
|
•
|
risks associated with ongoing compliance with environmental, health, safety, and regulatory laws and regulations, which may be subject to change;
|
•
|
the implementation, integration with other systems or ongoing management of our new enterprise resource planning system;
|
•
|
risks related to our indebtedness and compliance with covenants contained in our financing arrangement; and
|
•
|
the impact and costs and expenses of any litigation we may be subject to now or in the future.
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
March 31,
|
|
$
|
|
%
|
|||||||||
|
2014
|
|
2013
|
|
Change
|
|
Change
|
|||||||
|
(in thousands)
|
|
|
|||||||||||
Revenues:
|
|
|
|
|
|
|
|
|||||||
Manufacturing
|
$
|
153,963
|
|
|
$
|
172,975
|
|
|
$
|
(19,012
|
)
|
|
(11.0
|
)
|
Railcar leasing
|
11,746
|
|
|
6,543
|
|
|
5,203
|
|
|
79.5
|
|
|||
Railcar services
|
16,406
|
|
|
15,592
|
|
|
814
|
|
|
5.2
|
|
|||
Total revenues
|
$
|
182,115
|
|
|
$
|
195,110
|
|
|
$
|
(12,995
|
)
|
|
(6.7
|
)
|
Cost of revenues:
|
|
|
|
|
|
|
|
|||||||
Manufacturing
|
$
|
(118,365
|
)
|
|
$
|
(137,123
|
)
|
|
$
|
(18,758
|
)
|
|
(13.7
|
)
|
Railcar leasing
|
(4,491
|
)
|
|
(2,904
|
)
|
|
$
|
1,587
|
|
|
54.6
|
|
||
Railcar services
|
(13,365
|
)
|
|
(12,589
|
)
|
|
$
|
776
|
|
|
6.2
|
|
||
Total cost of revenues
|
$
|
(136,221
|
)
|
|
$
|
(152,616
|
)
|
|
$
|
(16,395
|
)
|
|
(10.7
|
)
|
Selling, general and administrative
|
(9,387
|
)
|
|
(11,265
|
)
|
|
(1,878
|
)
|
|
(16.7
|
)
|
|||
Earnings from operations
|
$
|
36,507
|
|
|
$
|
31,229
|
|
|
$
|
5,278
|
|
|
16.9
|
|
|
Three Months Ended
March 31, |
|
|
||||||||
|
(in thousands)
|
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
Ohio Castings
|
$
|
(190
|
)
|
|
$
|
(78
|
)
|
|
$
|
(112
|
)
|
Axis
|
(411
|
)
|
|
(612
|
)
|
|
201
|
|
|||
Amtek Railcar - India
|
—
|
|
|
(283
|
)
|
|
283
|
|
|||
Total Loss from Joint Ventures
|
$
|
(601
|
)
|
|
$
|
(973
|
)
|
|
$
|
372
|
|
|
Three Months Ended March 31,
|
|
|
||||||||||||||||||||||||
|
2014
|
|
2013
|
|
|
||||||||||||||||||||||
|
(in thousands)
|
|
|
||||||||||||||||||||||||
|
External
|
|
Intersegment
|
|
Total
|
|
External
|
|
Intersegment
|
|
Total
|
|
Change
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Manufacturing
|
$
|
153,963
|
|
|
$
|
64,029
|
|
|
$
|
217,992
|
|
|
$
|
172,975
|
|
|
$
|
55,408
|
|
|
$
|
228,383
|
|
|
$
|
(10,391
|
)
|
Railcar Leasing
|
11,746
|
|
|
—
|
|
|
11,746
|
|
|
6,543
|
|
|
—
|
|
|
6,543
|
|
|
5,203
|
|
|||||||
Railcar Services
|
16,406
|
|
|
132
|
|
|
16,538
|
|
|
15,592
|
|
|
49
|
|
|
15,641
|
|
|
897
|
|
|||||||
Eliminations
|
—
|
|
|
(64,161
|
)
|
|
(64,161
|
)
|
|
—
|
|
|
(55,457
|
)
|
|
(55,457
|
)
|
|
(8,704
|
)
|
|||||||
Total Consolidated
|
$
|
182,115
|
|
|
$
|
—
|
|
|
$
|
182,115
|
|
|
$
|
195,110
|
|
|
$
|
—
|
|
|
$
|
195,110
|
|
|
$
|
(12,995
|
)
|
Earnings (Loss) from Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Manufacturing
|
$
|
33,655
|
|
|
$
|
19,730
|
|
|
$
|
53,385
|
|
|
$
|
33,979
|
|
|
$
|
9,782
|
|
|
$
|
43,761
|
|
|
$
|
9,624
|
|
Railcar Leasing
|
6,230
|
|
|
31
|
|
|
6,261
|
|
|
2,163
|
|
|
4
|
|
|
2,167
|
|
|
4,094
|
|
|||||||
Railcar Services
|
2,181
|
|
|
38
|
|
|
2,219
|
|
|
2,305
|
|
|
43
|
|
|
2,348
|
|
|
(129
|
)
|
|||||||
Corporate/Eliminations
|
(5,559
|
)
|
|
(19,799
|
)
|
|
(25,358
|
)
|
|
(7,218
|
)
|
|
(9,829
|
)
|
|
(17,047
|
)
|
|
(8,311
|
)
|
|||||||
Total Consolidated
|
$
|
36,507
|
|
|
$
|
—
|
|
|
$
|
36,507
|
|
|
$
|
31,229
|
|
|
$
|
—
|
|
|
$
|
31,229
|
|
|
$
|
5,278
|
|
|
Three Months Ended
March 31, |
|
|
||||||||
|
2014
|
|
2013
|
|
Change
|
||||||
|
(in thousands)
|
|
|
||||||||
Net cash (used in) provided by:
|
|
|
|
|
|
||||||
Operating activities
|
$
|
(7,409
|
)
|
|
$
|
18,576
|
|
|
$
|
(25,985
|
)
|
Investing activities
|
(46,407
|
)
|
|
(36,697
|
)
|
|
(9,710
|
)
|
|||
Financing activities
|
111,124
|
|
|
(130,878
|
)
|
|
242,002
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(72
|
)
|
|
(42
|
)
|
|
(30
|
)
|
|||
(Increase) Decrease in cash and cash equivalents
|
$
|
57,236
|
|
|
$
|
(149,041
|
)
|
|
$
|
206,277
|
|
Exhibit No.
|
|
Description of Exhibit
|
|
|
|
10.1
|
|
Form of 2014 Stock Appreciation Rights Agreement #
|
|
|
|
10.2
|
|
Offer Letter, dated February 26, 2014, between the Company and Yevgeny Fundler #
|
|
|
|
31.1
|
|
Rule 13a-14(a), 15d-14(a) Certification of the Interim Chief Executive Officer*
|
|
|
|
31.2
|
|
Rule 13a-14(a), 15d-14(a) Certification of the Chief Financial Officer*
|
|
|
|
32.1
|
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**
|
|
|
|
101.INS
|
|
XBRL Instance Document*
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document*
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document*
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document*
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document*
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document*
|
*
|
Filed herewith
|
**
|
Furnished herewith
|
#
|
Indicates management contract or compensatory plan or arrangement
|
|
|
AMERICAN RAILCAR INDUSTRIES, INC.
|
||
|
|
|
|
|
Date:
|
May 5, 2014
|
By:
|
|
/s/ Jeffrey S. Hollister
|
|
|
|
|
Jeffrey S. Hollister, President and Interim Chief Executive Officer
|
|
|
|
|
|
|
|
By:
|
|
/s/ Dale C. Davies
|
|
|
|
|
Dale C. Davies, Senior Vice President,
Chief Financial Officer and Treasurer
|
Exhibit No.
|
|
Description of Exhibit
|
|
|
|
10.1
|
|
Form of 2014 Stock Appreciation Rights Agreement #
|
|
|
|
10.2
|
|
Offer Letter, dated February 26, 2014, between the Company and Yevgeny Fundler #
|
|
|
|
|
|
|
31.1
|
|
Rule 13a-14(a), 15d-14(a) Certification of the Interim Chief Executive Officer*
|
|
|
|
31.2
|
|
Rule 13a-14(a), 15d-14(a) Certification of the Chief Financial Officer*
|
|
|
|
32.1
|
|
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**
|
|
|
|
101.INS
|
|
XBRL Instance Document*
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document*
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document*
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document*
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document*
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document*
|
*
|
Filed herewith
|
**
|
Furnished herewith
|
#
|
Indicates management contract or compensatory plan or arrangement
|
Vesting Date
|
# of Total
SARs Vested
|
% of Total Number of
SARs Vested
|
|
|
33.3%
|
|
|
33.3%
|
|
|
33.3%
|
SARs Holder:
By: ________________________________
|
American Railcar Industries, Inc.:
By: ________________________________ |
1.
|
Exercise of SARs
. Effective as of today, ______________, 20___, the undersigned (“Holder”) hereby elects to exercise _________ SARs under and pursuant to the 2005 Equity Incentive Plan (the “Plan”) and the Stock Appreciation Rights Agreement dated ____________, 20___ (the “Award Agreement”). Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Plan.
|
2.
|
Representations of Holder
. Holder acknowledges that Holder has received, read and understood the Plan and the Award Agreement and agrees to abide by and be bound by their terms and conditions.
|
3.
|
Tax Consultation
. Holder understands that Holder may suffer adverse tax consequences as a result of Holder's exercise of the SARs. Holder represents that Holder has consulted with any tax consultants Holder deems advisable in connection with the purchase or disposition of the Shares and that Holder is not relying on the Company for any tax advice.
|
|
|
|
Signature
|
|
By
|
|
|
|
Print Name
|
|
Title
|
|
Date Received
|
1.
|
I have reviewed this quarterly report on Form 10-Q of American Railcar Industries, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
May 5, 2014
|
|
/s/ Jeffrey S. Hollister
|
|
|
|
Jeffrey S. Hollister, President and Interim Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of American Railcar Industries, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
May 5, 2014
|
|
/s/ Dale C. Davies
|
|
|
|
Dale C. Davies, Senior Vice President,
Chief Financial Officer and Treasurer
|
1.
|
the quarterly report on Form 10-Q of the Company for the three months ended
March 31, 2014
(the “Quarterly Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
May 5, 2014
|
|
/s/ Jeffrey S. Hollister
|
|
|
|
Jeffrey S. Hollister, President and Interim Chief Executive Officer
|
1.
|
the quarterly report on Form 10-Q of the Company for the three months ended
March 31, 2014
(the “Quarterly Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
May 5, 2014
|
|
/s/ Dale C. Davies
|
|
|
|
Dale C. Davies, Senior Vice President,
Chief Financial Officer and Treasurer
|