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What changed in FreightCar America, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of FreightCar America, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+147 added−162 removedSource: 10-K (2025-03-12) vs 10-K (2024-03-18)

Top changes in FreightCar America, Inc.'s 2024 10-K

147 paragraphs added · 162 removed · 110 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeYear Ended December 31, 2023 2022 Railcar backlog at start of period 2,445 2,323 Net railcar orders received 3,491 3,306 Railcars delivered (3,022 ) (3,184 ) Railcar backlog at end of period (1) 2,914 2,445 Estimated revenue from backlog at end of period (in thousands) (2) $ 348,229 $ 287,969 (1) Railcar backlog includes 190 and 423 rebuilt railcars as of December 31, 2023 and 2022, respectively.
Biggest changeThe following table depicts our reported railcar backlog in number of railcars and estimated future sales value attributable to such backlog, for the periods shown (in thousands). 5 Year Ended December 31, 2024 2023 Railcar backlog at start of period 2,914 2,445 Net railcar orders received 4,245 3,491 Railcars delivered (4,362 ) (3,022 ) Railcar backlog at end of period (1) 2,797 2,914 Estimated revenue from backlog at end of period (2) $ 266,518 $ 348,229 (1) Railcar backlog includes 1,285 and 190 rebuilt railcars as of December 31, 2024 and 2023, respectively.
Our covered hopper railcar product offerings encompass a wide range of cubic foot (“cf”) capacity designs for shipping dry bulk commodities of varying densities including: 3,282 cf covered hopper cars for cement, sand and roofing granules; 4,300 cf covered hopper cars for potash or similar commodities; 5,200 cf, 5,400 cf, 5,450 cf, 5,700 cf and 3 5,800 cf-covered hopper cars for grain and other agricultural products; and 5,850 cf and 6,500 cf covered hopper cars for plastic pellets. • DynaStack Series .
Our covered hopper railcar product offerings encompass a wide range of cubic foot (“cf”) capacity designs for shipping dry bulk commodities of varying densities including: 3,282 cf covered hopper cars for cement, sand and roofing granules; 4,300 cf covered hopper cars for potash or similar commodities; 5,200 cf, 5,400 cf, 5,450 cf, 5,700 cf and 5,800 cf-covered hopper cars for grain and other agricultural products; and 5,850 cf and 6,500 cf covered hopper cars for plastic pellets. • DynaStack Series .
Competition in the North American market from railcar manufacturers located outside of North America is limited by, among other factors, high shipping costs and familiarity with the North American market. In addition to price, competition is based on delivery timing, product performance and technological innovation, reputation for product quality and customer service and support.
Competition in the North American market from railcar manufacturers located outside of North America is limited by, among other factors, high shipping costs and familiarity with the North American market. In addition to price, competition is based on delivery timing, product performance and technological innovation, reputation for product quality and customer service.
Our VersaFlood™ series open-top hopper railcars include steel, stainless steel or hybrid steel and aluminum-bodied designs equipped with three-pocket (transverse gate) or two-pocket (longitudinal gate) discharge door systems with manual, independent or fully automatic door operation. • Covered Hopper Cars .
Our VersaFlood™ series open-top hopper railcars include steel, stainless steel or hybrid steel and aluminum-bodied designs equipped with three-pocket (transverse gate) or two-pocket (longitudinal gate) discharge door systems with manual, independent or fully automatic door operation. 3 • Covered Hopper Cars .
A majority of our Board includes diverse and/or independent Board members with extensive experience and expertise in a variety of industries. Our Board provides counsel to and oversight of the senior management team to ensure that our business strategies align with our corporate responsibility goals.
A majority of our Board includes diverse and/or independent Board members with extensive 7 experience and expertise in a variety of industries. Our Board provides counsel to and oversight of the senior management team to ensure that our business strategies align with our corporate responsibility goals.
Environmental Stewardship To minimize the environmental impact of our business, we have introduced lighter weight freight cars which require less energy to manufacture and offer higher capacity than the freight cars they replace. We are also a leader in the railcar conversion and rebody space, with over 14,000 conversion and rebody projects completed over the last decade.
Environmental Stewardship To minimize the environmental impact of our business, we have introduced lighter weight freight cars that require less energy to manufacture and offer higher capacity than the freight cars they replace. We are also a leader in the railcar conversion and rebody space, with over 14,000 conversion and rebody projects completed over the last decade.
We are a leader in rebuilding and repurposing freight car assets. From complete car rebuilds to transforming unused railcars into the latest designs, we deliver customer-focused solutions. We have completed over 14,000 total conversions and rebuilds in the last decade and offer a broad portfolio of over 20 car conversion options.
We are a leader in rebuilding and repurposing freight car assets. From complete car rebuilds to transforming unused railcars into the latest designs, we deliver customer-focused solutions. We have completed over 15,000 total conversions and rebodies in the last decade and offer a broad portfolio of over 20 car conversion options.
We use a sole supplier of our roll-formed center sills, which were used in 27% and 53% of our new railcars produced in 2023 and 2022, respectively. A center sill is the primary longitudinal structural component of a railcar, which helps the railcar withstand the weight of the cargo and the force of being pulled during transport.
We use a sole supplier of our roll-formed center sills, which were used in 51% and 27% of our new railcars produced in 2024 and 2023, respectively. A center sill is the primary longitudinal structural component of a railcar, which helps the railcar withstand the weight of the cargo and the force of being pulled during transport.
GOVERNMENTAL REGULATION Railcar Industry The Federal Railroad Administration (“FRA”) administers and enforces U.S. federal laws and regulations relating to railroad safety. These regulations govern equipment and safety compliance standards for freight railcars and other rail equipment used in interstate commerce.
GOVERNMENTAL REGULATION Railcar Industry The Federal Railroad Administration (“FRA”) administers and enforces United States federal laws and regulations relating to railroad safety. These regulations govern equipment and safety compliance standards for freight railcars and other rail equipment used in interstate commerce.
We believe that our customers’ preference for reliable, high-quality products, our engineering design expertise, technological leadership in developing and enhancing innovative products and the competitive pricing of our railcars have helped us maintain our long-standing relationships with our customers. In 2023, revenue from the Company’s top three customers accounted for 19%, 16% and 15%, respectively, of total revenue.
We believe that our customers’ preference for reliable, high-quality products, our engineering design expertise, technological leadership in developing and enhancing innovative products and the competitive pricing of our railcars have helped us maintain our long-standing relationships with our customers. In 2024, revenue from the Company’s top three customers accounted for 13%, 9% and 9%, respectively, of total revenue.
Item 1. Business . OVERVIEW FreightCar America, Inc., a Delaware corporation (“FCA”), with its subsidiaries (the “Company”, “we”, “us”, and “our” refers to FCA and its subsidiaries), is a diversified manufacturer of railcars and railcar components.
Item 1. Business . OVERVIEW FreightCar America, Inc., a Delaware corporation (“FreightCar”), with its subsidiaries (the “Company”, “we”, “us”, or “our” refers to FreightCar and its subsidiaries), is a diversified manufacturer and supplier of railcars and railcar components.
Our compensation programs are designed to ensure that we attract and retain the right talent. We generally review and consider median market pay levels when assessing total compensation, but pay decisions are based on a more comprehensive set of considerations including company performance, individual performance, experience, and internal equity.
Our compensation programs are designed to ensure that we attract and retain the right talent. We generally review and consider market pay levels when assessing total compensation, but pay decisions are based on a more comprehensive set of considerations including company performance, individual performance, experience, and internal equity. We continually monitor key talent metrics including employee engagement and employee turnover.
We are also subject to oversight in other jurisdictions by foreign regulatory agencies and to the extent that we expand our business internationally, we may be subject to the laws and regulations of other non-U.S. jurisdictions.
We are also subject to oversight in other jurisdictions by foreign regulatory agencies and to the extent that we expand our business internationally, we may be subject to the laws and regulations of other jurisdictions outside the United States.
Our total backlog of firm orders for railcars increased from 2,445 railcars as of December 31, 2022 to 2,914 railcars as of December 31, 2023. Our backlog as of December 31, 2023 includes a variety of railcar types and the estimated sales value of the backlog is $348 million. Our website is www.freightcaramerica.com.
Our total backlog of firm orders for railcars decreased from 2,914 railcars as of December 31, 2023 to 2,797 railcars as of December 31, 2024. Our backlog as of December 31, 2024 includes a variety of railcar types and the estimated sales value of the backlog is $267 million. Our website is www.freightcaramerica.com.
In 2023, sales to our top five customers accounted for approximately 69% of total revenue. In 2022, revenue from the Company’s top three customers accounted for approximately 20%, 19% and 16%, respectively, of total revenue. In 2022, sales to our top five customers accounted for approximately 76% of total revenue.
In 2024, sales to our top five customers accounted for approximately 48% of total revenue. In 2023, revenue from the Company’s top three customers accounted for approximately 19%, 16% and 15%, respectively, of total revenue. In 2023, sales to our top five customers accounted for approximately 69% of total revenue.
We continually monitor key talent metrics including employee engagement and employee turnover. Our employee benefits programs strive to deliver competitive benefits that are effective in attracting and retaining talent, that create a culture of well-being and inclusiveness, and that meet the diverse needs of our employees.
Our employee benefits programs strive to deliver competitive benefits that are effective in attracting and retaining talent, that create a culture of well-being and inclusiveness, and that meet the diverse needs of our employees.
Our safety performance is regularly monitored by our senior leadership team, our CEO, and our Board. 7 Governance Our governance structure is designed to provide accountability for responsible business practices, facilitate transparency and ultimately promote the long-term interests of our stakeholders. We strive to ensure that all our employees act ethically and with integrity in all aspects of their work.
Governance Our governance structure is designed to provide accountability for responsible business practices, facilitate transparency and ultimately promote the long-term interests of our stakeholders. We strive to ensure that all our employees act ethically and with integrity in all aspects of their work.
Costs associated with research and development are expensed as incurred. BACKLOG We define backlog as the value of those products or services which our customers have committed in writing to purchase from us when built, but which have not yet been recognized as sales.
BACKLOG We define backlog as the value of those products or services which our customers have committed in writing to purchase from us when built, but which have not yet been recognized as sales.
Workplace safety is a top priority for the Company and we are focused on improving our safety performance with a goal of zero injuries and incidents.
Workplace safety is a top priority for the Company, and we are focused on improving our safety performance with a goal of zero injuries and incidents. Our safety performance is regularly monitored by our senior leadership team, our CEO, and our Board.
INTELLECTUAL PROPERTY 6 We have several U.S. and international patents and pending applications, registered trademarks, copyrights and trade names. Our key patent includes our hopper railcar with automatic individual door system. The protection of our intellectual property is important to our business.
INTELLECTUAL PROPERTY We have several United States and international patents and pending applications, registered trademarks, copyrights and trade names. Our key patent includes our hopper railcar with automatic individual door system.
MANUFACTURING Our railcar production facility in Castaños, Coahuila, Mexico (the “Castaños Facility”) is certified by the Association of American Railroads (the “AAR”), which sets railcar manufacturing industry standards for quality control.
MANUFACTURING Our railcar production facility in Castaños, Coahuila, Mexico (the “Manufacturing Facility”) is certified by the Association of American Railroads (the “AAR”), which sets railcar manufacturing industry standards for quality control. 4 Our manufacturing process involves four basic steps: fabrication, assembly, finishing and inspection.
We did not have any railcar sales to customers outside the United States in 2023 and 2022. Many of our customers do not purchase railcars every year because railcar fleets are not necessarily replenished or augmented every year.
Our railcar sales to customers outside the United States were $9.7 million in 2024. There were no sales to customers outside the United States in 2023. Many of our customers do not purchase railcars every year because railcar fleets are not necessarily replenished or augmented every year.
Estimated revenue from backlog does not reflect potential price increases and decreases under customer contracts that provide for variable pricing based on changes in the cost of raw materials.
(2) Estimated revenue from backlog reflects the total revenue attributable to the backlog reported at the end of the period as if such backlog were converted to actual sales. Estimated revenue from backlog does not reflect potential price increases and decreases under customer contracts that provide for variable pricing based on changes in the cost of raw materials.
HUMAN CAPITAL Employees As of December 31, 2023, we had 2,023 employees, of which 398 were salaried, and 1,625 were hourly wage earners represented by unions in the United States and Mexico. As of December 31, 2023, 1,961 of our employees were based in Mexico, 60 were based in the U.S. and 2 were based in China.
As of December 31, 2024, 1,967 of our employees were based in Mexico, 61 were based in the United States and two were based in China. As of December 31, 2023, we had 2,023 employees, of whom 398 were salaried and 1,625 were hourly wage earners.
However, customer orders may be subject to customer requests for delays in railcar deliveries, inspection rights and other customary industry terms and conditions, which could prevent or delay backlog from being converted into sales. 5 The following table depicts our reported railcar backlog in number of railcars and estimated future sales value attributable to such backlog, for the periods shown (in thousands).
However, customer orders may be subject to customer requests for delays in railcar deliveries, inspection rights and other customary industry terms and conditions, which could prevent or delay backlog from being converted into sales.
Our center sill is formed into its final shape without heating by passing steel plate through a series of rollers. A change in mix explains the decrease year-over-year as not all car types use a roll formed center sill. Other suppliers provide brake systems, castings, bearings and various other components.
Our center sill is formed into its final shape without heating by passing steel plate through a series of rollers. A change in mix explains the increase year-over-year as not all car types use a roll formed center sill. Our top ten suppliers accounted for 64% and 60% of our total purchases in 2024 and 2023, respectively.
In the year ended December 31, 2023, we delivered 3,022 railcars, including 2,707 new railcars and 315 rebuilt railcars, compared to 3,184 railcars, including 2,281 new railcars and 903 rebuilt railcars, delivered in the year ended December 31, 2022.
In the year ended December 31, 2024, we delivered 4,362 railcars, comprised of 4,252 new railcars and 110 rebuilt railcars, compared to 3,022 railcars, comprised of 2,707 new railcars and 315 rebuilt railcars, delivered in the year ended December 31, 2023.
We work closely with our customers to understand their expectations and design railcars that meet their needs. New product designs are tested and validated for compliance with AAR standards prior to introduction. This comprehensive approach provides the criteria and direction that ensure we are developing products that our customers desire and perform as expected.
We develop and introduce new railcar designs as a result of a combination of customer feedback and close observation of developing market trends. We work closely with our customers to understand their expectations and design railcars that meet their needs. New product designs are tested and validated for compliance with AAR standards prior to introduction.
RESEARCH AND DEVELOPMENT We utilize the latest engineering methods, tools and processes to ensure that new products and processes meet our customers’ requirements and are delivered in a timely manner. We develop and introduce new railcar designs as a result of a combination of customer feedback and close observation of developing market trends.
Our product offerings also include aftermarket parts, supplies and services. RESEARCH AND DEVELOPMENT We utilize the latest engineering methods, tools and processes to ensure that new products and processes meet our customers’ requirements and are delivered in a timely manner.
Over the last several years, we have introduced a number of new or redesigned railcar types as we continue to diversify our product portfolio. Our primary customers are shippers, railroads, and financial institutions which represented 33%, 16% and 47%, respectively, of our total sales attributable to each type of customer for the year ended December 31, 2023.
Our primary customers are financial institutions, shippers, and railroads which represented 42%, 33%, and 22% respectively, of our total sales attributable to each type of customer for the year ended December 31, 2024.
The railcar industry is periodically subject to supply constraints for some of the key railcar components. Except as described above, there are usually at least two suppliers for each of our raw materials and specialty components. Our top ten suppliers accounted for 60% and 62% of our total purchases in 2023 and 2022, respectively.
Our primary specialty components include trucks, brakes, wheels and axles which are often specified by our customers. The railcar industry is periodically subject to supply constraints for some of the key railcar components; however, there are generally at least two suppliers for each of our raw material and specialty components, except as described below.
We design and manufacture a broad variety of railcar types for transportation of bulk commodities and containerized freight products primarily in North America, including box cars, open top hoppers, covered hoppers, and gondolas along with intermodal and non-intermodal flat cars. We and our predecessors have been manufacturing railcars since 1901.
We design and manufacture a broad variety of railcar types for transportation of bulk commodities and containerized freight products primarily in North America. We also provide railcar rebody and repair services, railcar conversion services that repurpose idled rail assets back into revenue service, and supply railcar parts. We have been manufacturing railcars since 1901.
Aluminum prices generally are not fixed at the time a railcar order is accepted due to our infrequent usage and subsequent low volume purchases of aluminum from our two primary suppliers. Steel prices generally are not fixed at the time a railcar order is accepted due to fluctuations in market prices.
Aluminum and steel prices generally are not fixed at the time a railcar order is accepted due to fluctuations in market prices. We manufacture the majority of sub-assemblies on our railcar products with our vertically integrated fabrication shop, which allows us to more efficiently manage our supply chain.
As of December 31, 2022, we had 1,435 employees, of whom 319 were salaried and 1,116 were hourly wage earners. As of December 31, 2022, 1,381 of our employees were based in Mexico, 52 were based in the U.S. and 2 were based in China.
As of December 31, 2023, 1,961 of our employees were based in Mexico, 60 were based in the United States and two were based in China.
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Our Castaños Facility began production during the third quarter of 2020 and provides a solid platform from which to pursue a broad range of commodity carrying railcar business including intermodal well cars, non-intermodal flat cars and various open-top hopper, covered hopper and gondola cars. 4 Our manufacturing process involves four basic steps: fabrication, assembly, finishing and inspection.
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The information contained in or accessible through our website is not incorporated by reference into and is not a part of this Annual Report on Form 10-K.
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SALES AND MARKETING Our direct sales group is organized by customer and geography and consists of vice presidents of sales (“VPs”), a contract administrator, a manager of customer service, a director of field support, and support staff. The VPs are responsible for developing and closing new business and managing customer relationships.
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SALES AND MARKETING The Company’s products and services are marketed and sold via our direct sales team, which is organized by both customer and territory. Our consultive sales approach and customer engagement process is focused on understanding customer challenges and tailoring our products and services to deliver a final solution that fits the specific need.
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Our contract administrator is responsible for preparing proposals and other inside sales activities. Our director of field support is responsible for after-sale follow-up, technical support, training, and in-field product performance reviews and warranty.
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This comprehensive approach provides the criteria and direction that ensure we are developing products that our customers desire and perform as expected. Costs associated with research and development are expensed as incurred.
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(2) Estimated revenue from backlog reflects the total revenue attributable to the backlog reported at the end of the period as if such backlog were converted to actual sales. Estimated revenue from backlog as of December 31, 2023 includes $14,850 that is not expected to be converted to sales within one year.
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The protection of our intellectual property is important to our business. 6 HUMAN CAPITAL Employees As of December 31, 2024, we had 2,030 employees, of which 407 were salaried, and 1,623 were hourly wage earners represented by unions in the United States and Mexico.
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As a result, the management of raw materials and components purchasing is critical to our profitability. We enjoy generally strong relationships with our suppliers, which helps to ensure access to supplies when railcar demand is high.
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In 2023 we completed the build out of our fabrication shop at our Castaños Facility. Roughly 60% of fabricated parts were produced internally with the balance being sourced from local suppliers. Our primary component suppliers supply us with truck components, brake components, and couplers, wheels and axles.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeManagement reports to the Audit Committee, at least quarterly, and more frequently if needed, on the Company’s cybersecurity risk management program, including periodic assessments and tests addressing cybersecurity threats and incidents
Biggest changeOur Director of IT drives collective focus and central coordination of our cybersecurity risk management program internally and oversees our retained external MSSP personnel . Management reports to the Audit Committee, at least quarterly, and more frequently if needed, on the Company’s cybersecurity risk management program, including periodic assessments and tests addressing cybersecurity threats and incidents.
Our internal IT team considers cybersecurity capabilities of third-party service providers prior to engaging them and on an ongoing basis. Our key external IT 8 vendors provide the Company with system and organizational control reports that are reviewed by our internal IT team and may reveal potential security risks.
Our internal IT team considers 8 cybersecurity capabilities of third-party service providers prior to engaging them and on an ongoing basis. Our key external IT vendors provide the Company with system and organizational control reports that are reviewed by our internal IT team and may reveal potential security risks.
Our MSSP team leaders have significant experience working in cybersecurity and employ a trained workforce designed to provide proactive and comprehensive cybersecurity care. Together with our MSSP, we also monitor the frequency and extent of cybersecurity threats and update our processes and procedures as necessary. On an annual basis, our internal auditors perform penetration testing and other assessments.
Our MSSP team leaders have significant experience working in cybersecurity and employ a trained workforce designed to provide proactive and comprehensive cybersecurity care. Together with our MSSP, we also monitor the frequency and extent of cybersecurity threats and update our processes and procedures as necessary. On an annual basis, our internal auditors conduct penetration testing and other assessments.
No cybersecurity threats occurred during the year ended December 31, 2023 that have had, or are reasonably likely to have had, a material impact on our business or financial results. We utilize the National Institute of Standards and Technology (“NIST”) framework with our security program to identify, mitigate, and manage cybersecurity risks.
No cybersecurity threats occurred during the year ended December 31, 2024 that have had, or are reasonably likely to have had, a material impact on our business strategy, results of operations, or financial condition.
The Company’s cybersecurity risk management program is under the direction of our Director of IT, who reports directly to our Chief Financial Officer. Our Director of IT drives collective focus and central coordination of our cybersecurity risk management program internally and oversees our retained external MSSP personnel.
The Company’s cybersecurity risk management program is under the direction of our Director of IT, who reports directly to our Chief Financial Officer and has over two decades of experience in the field of information technology and security .
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However, if as a result of any future attacks, our information technology systems are significantly damaged, cease to function properly or are subject to a significant cybersecurity breach, we may suffer an interruption in our ability to manage and operate our business, and our business strategy, results of operations or financial condition could be adversely affected.
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Such attacks, whether or not successful, could result in significant costs related to, for example, repairing or replacing our IT systems; the loss of critical data; and interruptions or delays in our ability to perform critical functions.
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In addition, the volume, frequency and sophistication of these threats (including through the use of artificial intelligence) continues to grow and the complexity and scale of the systems to be protected continues to increase. We utilize the National Institute of Standards and Technology (“NIST”) framework with our security program to identify, mitigate, and manage cybersecurity risks .

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table presents information on our primary leased and owned operating properties as of December 31, 2023: Use Location Size Leased or Owned Lease Expiration Date Corporate headquarters Chicago, Illinois 8,800 square feet Leased November 30, 2031 Railcar assembly and component manufacturing Castaños, Mexico 658,128 square feet Leased September 30, 2040 Administrative and parts warehouse Johnstown, Pennsylvania 86,000 square feet Leased December 31, 2028 Sourcing office Qingdao, China 1,485 square feet Leased October 31, 2025
Biggest changeThe following table presents information on our primary leased and owned operating properties as of December 31, 2024: Use Location Size Leased or Owned Lease Expiration Date Corporate headquarters Chicago, Illinois 8,800 square feet Leased November 30, 2031 Railcar assembly and component manufacturing Castaños, Mexico 684,597 square feet Leased September 30, 2040 Administrative and parts warehouse Johnstown, Pennsylvania 86,000 square feet Leased December 31, 2028 Sourcing office Qingdao, China 1,485 square feet Leased October 31, 2025

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings. The information in response to this item is included in Note 17, Risks and Contingencies, to our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K. Item 4. Mine Safety Disclosures. Not applicable PART II
Biggest changeItem 3. Legal Proceedings. The information in response to this item is included in Note 18, Commitments and Contingencies, to our Consolidated Financial Statements included in Part II, Item 8 of this Form 10-K. Item 4. Mine Safety Disclosures. Not applicable PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock, par value $0.01 per share (the “Common Stock”) has been quoted on the Nasdaq Global Market under the symbol “RAIL” since April 6, 2005.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock, par value $0.01 per share (the “Common Stock”) has been quoted on the Nasdaq Global Market under the symbol “RAIL” since April 6, 2005. Our transfer agent and registrar is Computershare Investor Services, P.O. Box 43078, Providence, Rhode Island 02940.
The ability of our Board to declare a dividend on our Common Stock is limited by Delaware law. Item 6. Reserved 9
The ability of our Board to declare a dividend on our Common Stock is limited by Delaware law. 9 Item 6. Reserved.
As of March 14, 2024, there were approximately 66 holders of record of our Common Stock, which does not include persons whose shares of Common Stock are held by a bank, brokerage house or clearing agency.
As of March 6, 2025, there were approximately 71 holders of record of our Common Stock, which does not include persons whose shares of Common Stock are held by a bank, brokerage house or clearing agency.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThese potential risks and uncertainties relate to, among other things, the cyclical nature of our business; adverse economic and market conditions; material disruption in the movement of rail traffic for deliveries; fluctuating costs of raw materials, including steel and aluminum; delays in the delivery of raw materials; our ability to maintain relationships with our suppliers of railcar components; the competitive nature of our industry, our reliance upon a small number of customers that represent a large percentage of our sales; the variable purchase patterns of our customers and the timing of completion; delivery and customer acceptance of orders; potential financial and operational impacts of the COVID-19 pandemic; the competitive nature of our industry; fluctuating costs of raw materials, including steel and aluminum, delays in the delivery of raw materials, the risk of lack of acceptance of our new railcar offerings by our customers; and other competitive factors.
Biggest changeThese potential risks and uncertainties relate to, among other things, the cyclical nature of our business; adverse economic and market conditions, including inflation; material disruption in the movement of rail traffic for deliveries; fluctuating costs of raw materials, including steel and aluminum; delays in the delivery of raw materials; our ability to maintain relationships with our suppliers of railcar components; our reliance upon a small number of customers that represent a large percentage of our sales; the variable purchase patterns of our customers and the timing of completion; delivery and customer acceptance of orders; the highly competitive nature of our industry; the risk of lack of acceptance of our new railcar offerings; potential unexpected changes in laws, rules, and regulatory requirements, including tariffs and trade barriers (including recent United States tariffs imposed or threatened to be imposed on China, Canada, Mexico and other countries and any retaliatory actions taken by such countries); and other competitive factors.
Our Manufacturing segment sales depend on industry demand for new railcars, which is driven by overall economic conditions and the demand for railcar transportation of various products such as coal, steel products, minerals, cement, motor vehicles, forest products and agricultural commodities.
Our Manufacturing segment sales depend on industry demand for new railcars, which is driven by overall economic conditions and the demand for railcar transportation of various products such as steel products, minerals, cement, motor vehicles, forest products, agricultural commodities and coal.
Our net cash provided by operating activities for the year ended December 31, 2023 reflects changes in working capital, including an increase in inventory of $61.0 million to meet production needs for the start-up of several new railcar orders, offset by an increase in accounts payable of $39.9 million related to those purchases of inventory.
Our net cash provided by operating activities for the year ended December 31, 2023 reflects changes in working capital, including an increase in inventory of $61.0 million to meet production needs for the start-up of several new railcar orders, offset by an increase in accounts payable of $39.9 million related to those purchases of inventory. Investing Activities.
As a practical expedient, we recognize the incremental costs of obtaining contracts, such as sales commissions, as an expense when incurred since the amortization period of the asset that we otherwise would have recognized is one year or less. Performance obligations are satisfied and we recognize revenue from most parts sales when the parts are shipped to customers.
As a practical expedient, we recognize the incremental costs of obtaining contracts, such as sales commissions, as an expense when incurred since the amortization period of the asset that we otherwise would have recognized is one year or less. Aftermarket performance obligations are satisfied and we recognize revenue from most parts sales when the parts are shipped to customers.
We expressly disclaim any duty to provide updates to forward-looking statements, and the estimates and assumptions associated with them, in order to reflect changes in circumstances or expectations or the occurrence of unanticipated events except to the extent required by applicable securities laws. 19
We expressly disclaim any duty to provide updates to forward-looking statements, and the estimates and assumptions associated with them, in order to reflect changes in circumstances or expectations or the occurrence of unanticipated events except to the extent required by applicable securities laws. 17
Cash flows from operating activities are affected by several factors, including fluctuations in business volume, contract terms for billings and collections, the timing of collections on our contract receivables, processing of bi-weekly payroll and associated taxes, payments to our suppliers and other operating activities.
Cash flows from operating activities are affected by several factors, including fluctuations in business volume, contract terms for billings and collections, the timing of collections on our contract receivables, processing of payroll and associated taxes, payments to our suppliers and other operating activities.
Gain on Sale of Railcars Available for Lease Gain on sale of railcars available for lease for the year ended December 31, 2023 was $0.6 million and represented the gain on sale of 424 leased railcars with a net book value of $7.7 million. We did not sell any railcars for lease during the year ended December 31, 2022.
Gain on Sale of Railcars Available for Lease We did not sell any railcars available for lease during the year ended December 31, 2024. Gain on sale of railcars available for lease for the year ended December 31, 2023 was $0.6 million and represented the gain on sale of 424 leased railcars with a net book value of $7.7 million.
As of December 31, 2023 and 2022, we concluded that, based on evaluation of the positive and negative evidence, primarily our history of operating losses, it is not more likely than not that we will realize the benefit of our deferred tax assets.
As of December 31, 2024 and 2023, we concluded that, based on evaluation of the positive and negative evidence, primarily our history of operating losses, it is not more likely than not that we will realize the benefit of our deferred tax assets.
Pensions and postretirement benefits We historically provided pension and retiree welfare benefits to certain salaried and hourly employees upon their retirement. Benefits under our pension plan are now frozen and will not be impacted by increases due to future service.
Pensions and Post-Retirement Benefits We historically provided pension and retiree welfare benefits to certain salaried and hourly employees upon their retirement. Benefits under our pension plan are now frozen and will not be impacted by increases due to future service.
Our long-term liquidity is contingent upon future operating performance and our ability to continue to meet financial covenants under our revolving credit facilities, our Credit Agreement and any other indebtedness and the availability of additional financing if needed.
Our long-term liquidity is contingent upon future operating performance and our ability to continue to meet financial covenants under our credit facilities, any other indebtedness and the availability of additional financing if needed.
We anticipate funding pension contributions with cash from operations. Income taxes We account for income taxes under the asset and liability method prescribed by ASC 740, Income Taxes.
We anticipate funding any required pension contributions with cash from operations. Income Taxes We account for income taxes under the asset and liability method prescribed by ASC 740, Income Taxes.
Our net cash provided by or used in operating activities reflects net loss adjusted for non-cash charges and changes in operating assets and liabilities.
Our net cash provided by operating activities reflects net loss adjusted for non-cash charges and changes in operating assets and liabilities.
Our actual results may differ materially from those currently anticipated and expressed in such forward-looking statements. See “Forward-Looking Statements.” We are a diversified manufacturer of railcars and railcar components. We design and manufacture a broad variety of railcar types for transportation of bulk commodities and containerized freight products primarily in North America. We have been manufacturing railcars since 1901.
Our actual results may differ materially from those currently anticipated and expressed in such forward-looking statements. See “Forward-Looking Statements.” We are a diversified manufacturer of railcars and railcar components. We design and manufacture a broad variety of railcar types for transportation of bulk commodities and containerized freight products primarily in North America.
The most significant assumptions used in determining our net periodic benefit costs are the discount rate used on our pension and postretirement welfare obligations and expected return on pension plan assets. In 2023, we assumed that the expected long-term rate of return on pension plan assets would be 3.00%.
The most significant assumptions used in determining our net periodic benefit costs are the discount rate used on our pension and post-retirement welfare obligations and expected return on pension plan assets. In 2024, we assumed that the expected long-term rate of return on pension plan assets would be 3.00%.
In the fourth quarter of 2023, we initiated the process to gain possession of our fleet of triple hopper aggregate railcars under lease with the intention of repairing or converting and selling these railcars.
In the fourth quarter of 2023, we sought to re-gain possession of our fleet of triple hopper aggregate railcars under lease, with the intention of repairing or converting and selling these railcars.
Performance obligations are typically completed and revenue is recognized for the sale of new and rebuilt railcars when the finished railcar is transferred to a specified railroad connection point. In certain sales contracts, revenue is recognized when a certificate of acceptance has been issued by the customer and control has been transferred to the customer.
Manufacturing segment performance obligations are typically completed and revenue is recognized for the sale of new and converted or rebodied railcars when the finished railcar is transferred to a specified railroad connection point. In certain sales contracts, revenue is recognized when a certificate of acceptance has been issued by the customer and control has been transferred to the customer.
The Company used the base mortality table Pri-2012 projected generationally using a modified MP-2021 with Endemic COVID adjustment for purposes of measuring its pension obligations at December 31, 2023. For the years ended December 31, 2023 and 2022, we recognized consolidated pre-tax pension benefit cost (income) of $0.4 million and $(0.6) million, respectively.
The Company used the base mortality table Pri-2012 projected generationally using a modified MP-2021 with Endemic COVID adjustment for purposes of measuring its pension obligations as of December 31, 2024. For each of the years ended December 31, 2024 and 2023, we recognized consolidated pre-tax pension benefit cost of $0.4 million, respectively.
A change of one hundred basis points in the expected long-term rate of return on plan assets would have the following effect for the year ended December 31, 2023: 16 1% Increase 1% Decrease (in thousands) Effect on net periodic benefit cost $ (106) $ 106 Effect on pension settlement 6 (6) At the end of each year, we determine the discount rate to be used to calculate the present value of our pension plan liability.
A change of one hundred basis points in the expected long-term rate of return on plan assets would have the following effect for the year ended December 31, 2024: 1% Increase 1% Decrease (in thousands) Effect on net periodic benefit cost $ (100) $ 477 At the end of each year, we determine the discount rate to be used to calculate the present value of our pension plan liability.
A change of one hundred basis points in the discount rates used during the year ended December 31, 2023 would have the following effect: 1% Increase 1% Decrease (in thousands) Effect on net periodic benefit cost $ (2) $ (4) Effect on pension settlement (40) 41 In October 2021, the Society of Actuaries issued base mortality table Pri-2012 which is split by retiree and contingent survivor tables and includes mortality improvement assumptions for U.S. plans, scale (MP-2021 with COVID adjustment), which reflects additional data that the Social Security Administration has released since prior assumptions (MP-2020) were developed.
A change of one hundred basis points in the discount rates used during the year ended December 31, 2024 would have the following effect: 15 1% Increase 1% Decrease (in thousands) Effect on net periodic benefit cost $ 3 $ (9) In October 2021, the Society of Actuaries issued base mortality table Pri-2012 which is split by retiree and contingent survivor tables and includes mortality improvement assumptions for United States plans, scale (MP-2021 with COVID adjustment), which reflects additional data that the Social Security Administration has released since prior assumptions (MP-2020) were developed.
(Loss) Gain on Change in Fair Market Value of Warrant Liability Loss on change in fair market value of warrant liability was $2.2 million for the year ended December 31, 2023 compared to gain on change in fair market value of warrant liability of $1.5 million for the year ended December 31, 2022.
Loss on Change in Fair Market Value of Warrant Liability Loss on change in fair market value of warrant liability was $99.5 million for the year ended December 31, 2024 compared to $2.2 million for the year ended December 31, 2023.
Net cash used in investing activities for the year ended December 31, 2023 was $4.4 million primarily as a result of $12.7 million capital expenditures, offset by $8.4 million proceeds from the sale of railcars available for lease.
Net cash used in investing activities for the year ended December 31, 2023 was $4.4 million primarily as a result of $12.7 million capital expenditures related to the expansion of the Manufacturing Facility, offset by $8.4 million proceeds from the sale of railcars available for lease, net of selling costs. Financing Activities.
Significant estimates include useful lives of long-lived assets, warranty accruals, pension benefit assumptions, evaluation of property, plant and equipment for impairment and the valuation of deferred taxes. Actual results could differ from those estimates.
Significant estimates include useful lives of long-lived assets, warranty accruals, pension benefit assumptions, evaluation of property, plant and equipment for impairment and the valuation of deferred taxes.
Impairment on Leased Railcars For the year ended December 31, 2023, we recorded a pre-tax non-cash impairment charge related to our steel triple hopper aggregate railcars of $4.1 million due to management’s recoverability assessment in the fourth quarter of 2023.
For the year ended December 31, 2023, we recorded a pre-tax non-cash impairment charge related to our steel triple hopper aggregate railcars of $4.1 million due to management’s recoverability assessment in the fourth quarter of 2023. For further information, see Note 7 – Leased Railcars to our consolidated financial statements.
Our total backlog of firm orders for railcars increased from 2,445 railcars as of December 31, 2022 to 2,914 railcars as of December 31, 2023. The estimated sales value of the backlog was $348 million and $288 million, respectively, as of December 31, 2023 and 2022.
Our total backlog of firm orders for railcars decreased from 2,914 railcars as of December 31, 2023 to 2,797 railcars as of December 31, 2024. The estimated sales value of the backlog was $267 million and $348 million, respectively, as of December 31, 2024 and 2023.
RESULTS OF OPERATIONS Year Ended December 31, 2023 compared to Year Ended December 31, 2022 10 Revenues Our consolidated revenues for the year ended December 31, 2023 were $358.1 million compared to $364.8 million for the year ended December 31, 2022.
RESULTS OF OPERATIONS Year Ended December 31, 2024 compared to Year Ended December 31, 2023 Revenues Our consolidated revenues for the year ended December 31, 2024 were $559.4 million compared to $358.1 million for the year ended December 31, 2023.
Our critical accounting policies include the following: Impairment of long-lived assets and right-of-use assets We monitor the carrying value of long-lived assets and right-of-use assets for potential impairment.
Actual results could differ from those estimates. 14 Our critical accounting policies include the following: Impairment of Long-Lived Assets and Right-of-Use Assets We monitor the carrying value of long-lived assets and right-of-use assets for potential impairment.
Manufacturing segment selling, general and administrative expenses for the year ended December 31, 2023 were $2.1 million compared to $2.8 million for the year ended December 31, 2022. Manufacturing segment selling, general and administrative expenses for the year ended December 31, 2023 were 0.6% of revenue compared to 0.8% of revenue for the year ended December 31, 2022.
Consolidated selling, general and administrative expenses were 5.88% of revenue for each of the years ended December 31, 2024 and December 31, 2023. Manufacturing segment selling, general and administrative expenses for the year ended December 31, 2024 were $2.0 million compared to $2.1 million for the year ended December 31, 2023.
The variable purchase patterns of our customers and the timing of completion, delivery and customer acceptance of railcars may cause our revenues and income from operations to vary substantially each quarter, which will result in significant fluctuations in our quarterly results.
The variable purchase patterns of our customers and the timing of completion, delivery and customer acceptance may cause our revenues and income from operations to vary substantially each quarter, which will result in significant fluctuations in our quarterly results. Further, disruptions in the global supply chain may impact demand for, and the costs of, certain of our products and services.
We are not required to make any contributions to our pension plan during 2024. However, we may elect to adjust the level of contributions based on a number of factors, including performance of pension investments and changes in interest rates.
We may be required to make a contribution to our pension plan in 2025 to meet minimum funding requirements. However, we may elect to adjust the level of contributions based on a number of factors, including performance of pension investments and changes in interest rates.
Loss on Pension Settlement Loss on pension settlement for the year ended December 31, 2023 was $0.3 million related to a one-time, lump sum pay-out. Loss on pension settlement for the year ended December 31, 2022 was $8.1 million related to an annuity purchase agreement.
Loss on Pension Settlement There was no loss on pension settlement for the year ended December 31, 2024. Loss on pension settlement was $0.3 million related to a one-time, lump sum pay-out during the year ended December 31, 2023.
Railcar deliveries totaled 3,022 railcars, consisting of 2,707 new railcars and 315 rebuilt railcars, for the year ended December 31, 2023, compared to 3,184 railcars delivered in the year ended December 31, 2022, consisting of 2,281 new railcars and 903 rebuilt railcars.
Railcar deliveries totaled 4,362 railcars, consisting of 4,252 new railcars and 110 converted and rebodied railcars, for the year ended December 31, 2024, compared to 3,022 railcars delivered in the year ended December 31, 2023, consisting of 2,707 new railcars and 315 converted and rebodied railcars.
Our effective tax rate for the year ended December 31, 2023 was (6.8)% compared to (6.3)% for the year ended December 31, 2022. Net Loss As a result of the foregoing, our net loss was $23.6 million for the year ended December 31, 2023, compared to a net loss of $38.8 million for the year ended December 31, 2022.
Our effective tax rate for the year ended December 31, 2024 was (8.34)% compared to (6.80)% for the year ended December 31, 2023. Net Loss As a result of the changes discussed above, consolidated net loss was $75.8 million for the year ended December 31, 2024 compared to $23.6 million for the year ended December 31, 2023.
We generally recognize revenue at a point in time as we satisfy a performance obligation by transferring control over a product or service to a customer. Revenue is measured at the transaction price, which is based on the amount of consideration that we expect to receive in exchange for transferring the promised goods or services to the customer.
Revenue is measured at the transaction price, which is based on the amount of consideration that we expect to 16 receive in exchange for transferring the promised goods or services to the customer.
At December 31, 2023, we determined this rate on our pension plan to be 5.01%, a decrease of 0.21% from the 5.22% rate used at December 31, 2022.
As of December 31, 2024, we determined this rate on our pension plan to be 5.67%, an increase of 0.66% from the 5.01% rate used as of December 31, 2023.
We may also require additional capital in the future to fund working capital as demand for railcars increases, payments for contractual obligations, organic growth opportunities, including new plant and equipment and development of railcars, joint ventures, international expansion and acquisitions, and these capital requirements could be substantial. 14 Based upon our operating performance and capital requirements, we may, from time to time, be required to raise additional funds through additional offerings of our equity or debt and through long-term borrowings.
We may also require additional capital in the future to fund working capital for various reasons, such as future railcar demand; payments for contractual obligations; organic growth opportunities, including new plant and equipment and development of railcars; joint ventures; international expansion; and acquisitions, and these capital requirements could be substantial.
For the year ended December 31, 2023 our net loss per share was $1.18 compared to net loss per share of $1.56 for the year ended December 31, 2022.
For the year ended December 31, 2024, basic and diluted net loss per share was $3.12 compared to $1.18 for the year ended December 31, 2023.
We recognize a loss against related inventory when we have a contractual commitment to manufacture railcars at an estimated cost in excess of the contractual selling price. 18 RECENT ACCOUNTING PRONOUNCEMENTS (See Note 2, Summary of Significant Accounting Policies, to our Consolidated Financial Statements) FORWARD-LOOKING STATEMENTS This Annual Report on Form 10-K contains certain forward-looking statements including, in particular, statements about our plans, strategies and prospects.
RECENT ACCOUNTING PRONOUNCEMENTS (See Note 2, Summary of Significant Accounting Policies, to our Consolidated Financial Statements) FORWARD-LOOKING STATEMENTS This Annual Report on Form 10-K contains certain forward-looking statements including, in particular, statements about our plans, strategies and prospects.
As of December 31, 17 2023, we had deferred tax assets of $87.7 million for which there was a valuation allowance of $71.6 million and we had total net deferred tax assets of $3.8 million. Product warranties Warranty terms are based on the negotiated railcar sales contracts.
As of December 31, 2024, we had deferred tax assets of $83.7 million for which there was a valuation allowance of $67.1 million and we had total deferred tax liabilities of $15.5 million. Product Warranties Warranty terms are based on the negotiated railcar sales contracts. Warranty costs are estimated using a two-step approach.
Restricted deposits of $0.3 million as of each of December 31, 2023 and 2022, respectively, relate to a customer deposit for purchase of railcars. Restricted deposits of $0.1 million and $3.6 million as of December 31, 2023 and 2022, respectively, are used to collateralize standby letters of credit with respect to performance guarantees.
Restricted deposits of $0.3 million and $0.1 million as of December 31, 2024 and 2023, respectively, are used to collateralize standby letters of credit with respect to certain performance guarantees. The standby letters of credit outstanding as of December 31, 2024 are a requirement as long as the performance guarantees are in place.
Corporate and Other selling, general and administrative expenses were $25.4 million for the year ended December 31, 2023 compared to $25.4 million for the year ended December 31, 2022.
Selling, General and Administrative Expenses Consolidated selling, general and administrative expenses for the year ended December 31, 2024 were $32.9 million compared to $27.5 million for the year ended December 31, 2023.
Our Manufacturing segment sales are also affected by competitive market pressures that impact our market share, the prices for our railcars and by the types of railcars sold. Our Manufacturing segment revenues also include revenues from major railcar rebuilds and lease rental payments received with respect to railcars under operating leases. Our Corporate and Other revenue sources include parts sales.
Our Manufacturing segment sales are also affected by competitive market pressures that impact our market share, the prices for our railcars and by the types of railcars sold. Our Manufacturing segment revenues also include revenues from railcar conversions and rebodies.
Corporate and Other selling, general and administrative expenses for the year ended December 31, 2023 included decreases in legal expenses of $1.0 million and stock-based compensation expenses of $0.9 million, offset by increases in corporate incentive plan bonus expenses of $1.0 million and consulting expenses of $0.3 million.
Consolidated selling, general and administrative expenses for the year ended December 31, 2024 included increases in legal expenses of $2.5 million, stock-based compensation expenses of $1.9 million, insurance expenses of $0.4 million and labor expenses of $0.4 million.
Capital Expenditures 15 Our capital expenditures were $12.7 million for the year ended December 31, 2023 compared to $7.8 million for the year ended December 31, 2022 and primarily related to the expansion of the Castaños Facility. We anticipate capital expenditures during 2024 to be approximately $5.0 million to $7.0 million.
Our capital expenditures were $12.7 million for the year ended December 31, 2023, a decrease year over year primarily due to the completion of the Manufacturing Facility’s expansion in 2023. We anticipate capital expenditures during 2025 to be approximately $5.0 million to $6.0 million.
Revenue recognition We generally recognize revenue at a point in time as we satisfy a performance obligation by transferring control over a product or service to a customer. Revenue is measured at the transaction price, which is based on the amount of consideration that we expect to receive in exchange for transferring the promised goods or services to the customer.
Revenue Recognition We generally recognize revenue at a point in time as we satisfy a performance obligation by transferring control over a product or service to a customer.
Loss on Extinguishment of Debt Loss on extinguishment of debt in the year ended December 31, 2023 was $14.9 million which primarily represents the loss on extinguishment of $17.8 million related to the extinguishment of the Credit Agreement through the issuance of Series C Preferred Stock, partially offset by the gain on extinguishment of $2.9 million related to the M&T Credit Agreement.
This loss is comprised of a $17.8 million loss on extinguishment of debt upon settlement of the Term Loan Credit Agreement in 2023 through the issuance of Series C Preferred Stock, offset by a $2.9 million gain on extinguishment of debt upon termination of the M&T Credit Agreement and Forbearance Agreement.
We made no contributions to our defined benefit pension plan during 2023 and are not required to make any contributions to our defined benefit pension plan in 2024. During 2023, the Company offered a one-time, lump-sum pay-out option to its terminated vested participants.
During 2023, the Company offered a one-time, lump-sum pay-out option to its terminated vested participants. For further information about our defined benefit pension plan, see Note 15 - Employee Benefit Plans.
Our consolidated gross margin was 11.7% for the year ended December 31, 2023 compared to 7.1% for the year ended December 31, 2022. Manufacturing segment gross profit for the year ended December 31, 2023 was $37.2 million compared to $22.2 million for the year ended December 31, 2022.
Gross Profit Our consolidated gross profit for the year ended December 31, 2024 was $67.0 million compared to $41.8 million for the year ended December 31, 2023. Our consolidated gross margin was 11.98% for the year ended December 31, 2024 compared to 11.66% for the 10 year ended December 31, 2023.
Consolidated selling, general and administrative expenses for the year ended December 31, 2023 included a decrease in legal expenses of $1.1 million. Consolidated selling, general and administrative expenses were 7.7% of revenue for the years ended December 31, 2023 and December 31, 2022.
Manufacturing segment selling, general and administrative expenses for the year ended December 31, 2024 were 0.37% of revenue compared to 0.61% of revenue for the year ended December 31, 2023. Aftermarket segment selling, general and administrative expenses for the year ended December 31, 2024 were $1.5 million compared to $0.7 million for the year ended December 31, 2023.
There can be no assurance that long-term debt, if needed, will be available on terms attractive to us, or at all. Furthermore, any additional equity financing may be dilutive to stockholders and debt financing, if available, may involve restrictive covenants.
Based upon our operating performance and capital requirements, we may, from time to time, be required to raise additional funds through additional offerings of our equity or debt and through long-term borrowings. There can be no assurance that long-term debt, if needed, will be available on terms attractive to us, or at all.
Net cash used in investing activities for the year ended December 31, 2022 was $7.8 million primarily as a result of capital expenditures. Financing Activities.
Net cash used in investing activities for the year ended December 31, 2024 was $5.0 million as a result of capital expenditures related to the enhancement of machinery and equipment on current production lines of the Manufacturing Facility.
Cash Flows The following table summarizes our net cash provided by or used in operating, investing, and financing activities for the years ended December 31, 2023 and 2022: 2023 2022 (In thousands) Net cash provided by (used in): Operating activities $ 4,769 $ 11,503 Investing activities (4,366 ) (7,816 ) Financing activities 2,245 7,985 Total $ 2,648 $ 11,672 Operating Activities.
Funding levels will be affected by future contributions, investment returns on plan assets, growth in plan liabilities and interest rates. 13 Cash Flows The following table summarizes our net cash provided by or used in operating, investing, and financing activities for the years ended December 31, 2024 and 2023: 2024 2023 (In thousands) Net cash provided by (used in): Operating activities $ 44,933 $ 4,769 Investing activities (5,019 ) (4,366 ) Financing activities (36,024 ) 2,245 Total $ 3,890 $ 2,648 Operating Activities.
Operating income for the Manufacturing segment was $31.6 million for the year ended December 31, 2023 compared to operating income of $14.8 million for the year ended December 31, 2022. Corporate and Other operating loss was $21.1 million for the year ended December 31, 2023 compared to $29.8 million for the year ended December 31, 2022.
Operating income for the Manufacturing segment was $59.6 million for the year ended December 31, 2024 compared to operating income of $31.6 million for the year ended December 31, 2023 reflecting the increase in railcars delivered during the year ended December 31, 2024.
Manufacturing segment revenues for the year ended December 31, 2023 were $345.9 million compared to $352.9 million for the year ended December 31, 2022.
Manufacturing segment revenues for the year ended December 31, 2024 were $541.2 million compared to $345.9 million for the year ended December 31, 2023. The increase in Manufacturing segment revenues for 2024 compared to 2023 reflects an increase in the number of railcars delivered from 3,022 railcars in 2023 to 4,362 railcars in 2024.
This analysis indicated that the carrying value exceeded the estimated undiscounted cash flows, and therefore, we were required to measure the fair value of these railcars and determine the amount of an impairment loss, if any.
We performed a cash flow recoverability test of the fleet, which indicated that the carrying value exceeded the estimated undiscounted cash flows, and were therefore required to measure the fair value of the railcars. Our analysis indicated an estimated fair value of the asset group of approximately $2.8 million, in comparison to the asset group’s carrying amount of $6.9 million.
The most significant assumptions used in determining our net periodic benefit costs are the discount rate used on our pension obligations and expected return on pension plan assets. As of December 31, 2023, our benefit obligation under our defined benefit pension plan was $11.4 million, which exceeded the fair value of plan assets by $1.0 million.
Benefits under our pension plan are frozen and will not be impacted by increases due to future service and compensation increases. The most significant assumptions used in determining our net periodic benefit costs are the discount rate used on our pension obligations and expected return on pension plan assets.
Our net cash provided by operating activities for the year ended December 31, 2023 was $4.8 million compared to net cash provided by operating activities of $11.5 million for the year ended December 31, 2022.
As some of our customers accept delivery of new railcars in train-set quantities, variations in our sales lead to significant fluctuations in our operating profits and cash from operating activities. Our net cash provided by operating activities for the year ended December 31, 2024 was $44.9 million compared to $4.8 million for the year ended December 31, 2023.
The results of our analysis indicated an estimated fair value of the asset group of approximately $2.8 million, in comparison to the asset group's carrying amount of $6.9 million. As a result of this analysis we recorded a pre-tax non-cash impairment charge of $4.1 million related to our triple hopper aggregate railcars during the fourth quarter of 2023.
As a result, we recorded a pre-tax non-cash impairment charge of $4.1 million related to the fleet during the fourth quarter of 2023. In the first quarter of 2024, the Company gained possession of these railcars.
Our failure to raise capital if and when needed could have a material adverse effect on our results of operations and financial condition. Benefits under our pension plan are frozen and will not be impacted by increases due to future service and compensation increases.
Furthermore, any additional equity financing may be dilutive to stockholders and debt financing, if available, may involve restrictive covenants. Our failure to raise capital if and when needed could have a material adverse effect on our results of operations and financial condition.
Net cash provided by financing activities for the year ended December 31, 2022 was $8.0 million and included net borrowings on revolving line of credit of $8.8 million and principal payments on the finance lease of $0.7 million.
Net cash used in financing activities for the year ended December 31, 2024 was $36.0 million and included proceeds from issuance of the Term Loan of $115.0 million, offset by deferred financing costs of $6.1 million, redemption of preferred shares of $85.4 million, dividends paid of $27.9 million, net repayments on revolving line of credit of $29.4 million, and principal payments on the finance lease of $2.1 million.
Corporate and Other revenues for the year ended December 31, 2023 were $12.2 million compared to $11.9 million for the year ended December 31, 2022, reflecting higher parts sales. Gross Profit Our consolidated gross profit for the year ended December 31, 2023 was $41.8 million compared to $25.8 million for the year ended December 31, 2022.
Aftermarket segment revenues for the year ended December 31, 2024 were $18.2 million compared to $12.2 million for the year ended December 31, 2023, reflecting higher parts sales driven by favorable volume and price mix in 2024. There were no Corporate revenues for the years ended December 31, 2024 and 2023.
The $16 million increase in consolidated gross profit and $15 million increase in Manufacturing segment gross profit reflect favorable product mix and improved margins per car. Selling, General and Administrative Expenses Consolidated selling, general and administrative expenses for the year ended December 31, 2023 were $27.5 million compared to $28.2 million for the year ended December 31, 2022.
Manufacturing segment gross profit for the year ended December 31, 2024 was $58.4 million compared to $37.2 million for the year ended December 31, 2023. The $25.2 million increase in consolidated gross profit and $21.2 million increase in Manufacturing segment gross profit is primarily due to the increase in the number of railcars delivered and favorable product mix.
Our net cash provided by operating activities for the year ended December 31, 2022 reflects changes in working capital, including a decrease in VAT receivable of $24.9 million due to the Company’s receipt of VAT refunds, partially offset by an increase in inventory of $8.5 million to meet production needs for the start-up of several new railcar orders. Investing Activities.
Our net cash provided by operating activities for the year ended December 31, 2024 reflects changes in working capital, including a decrease in inventory of $54.7 million, offset by a decrease in accounts payable of $38.3 million and increase in accounts receivable of $6.1 million, all of which correlate directly with the increase in deliveries in 2024.
Interest Expense 11 Interest expense was $15.0 million for the year ended December 31, 2023 compared to $25.4 million for the year ended December 31, 2022. The decrease in interest expense is driven by the extinguishment of the M&T Credit Agreement and the Credit Agreement in 2023.
Corporate operating loss was $29.5 million for the year ended December 31, 2024 compared to $25.0 million for the year ended December 31, 2023 reflecting the increases in legal expenses, stock-based compensation expenses, and insurance expenses during the year ended December 31, 2024. 11 Interest Expense Interest expense was $6.9 million for the year ended December 31, 2024 compared to $15.0 million for the year ended December 31, 2023.
The deferred financing costs are presented as an asset and amortized to interest expense on a straight-line basis over the term of the Siena Loan Agreement. Additional Liquidity Factors Our restricted cash, restricted cash equivalents and restricted certificates of deposit balances were $1.0 million and $4.1 million as of December 31, 2023 and 2022, respectively.
Additional Liquidity Factors Our restricted cash, restricted cash equivalents and restricted certificates of deposit balances were $3.9 million and $0.7 million as of December 31, 2024 and 2023, respectively. Restricted deposits of $0.3 million as of each of December 31, 2024 and 2023, respectively, relate to a customer deposit for purchase of railcars.
There was no loss on extinguishment of debt for the year ended December 31, 2022. Income Taxes Our income tax provision was $1.5 million for the year ended December 31, 2023 compared to $2.3 million for the year ended December 31, 2022. Our income tax provision for the year ended December 31, 2023 reflects pre-tax income for our Mexico subsidiary.
Loss on extinguishment of debt in the year ended December 31, 2023 was $14.9 million.
Operating Income (Loss) Our consolidated operating income for the year ended December 31, 2023 was $10.5 million compared to consolidated operating loss of $15.0 million for the year ended December 31, 2022.
Operating Income Our consolidated operating income for the year ended December 31, 2024 was $37.3 million compared to consolidated operating income of $10.5 million for the year ended December 31, 2023 driven primarily by the previously mentioned favorable volume variance, decrease in impairment on leased railcars, and increase in litigation settlement gain, partially offset by the previously mentioned increase in selling, general and administrative expenses.
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FINANCIAL STATEMENT PRESENTATION (In thousands, except for share and per share data and unless otherwise noted) Revenues Our Manufacturing segment revenues are generated primarily from sales of the railcars that we manufacture.
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We also provide railcar rebody and repair services, railcar conversion services that repurpose idled rail assets back into revenue service, and supply railcar parts. We have been manufacturing railcars since 1901. Our Manufacturing segment revenues are generated primarily from sales of the railcars that we manufacture.
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Cost of sales Our cost of sales includes the cost of raw materials such as aluminum and steel, as well as the cost of finished railcar components, such as castings, wheels, truck components and couplers, and other specialty components. Our cost of sales also includes labor, utilities, freight, manufacturing depreciation and other operating costs.
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Our Aftermarket segment revenues are generated primarily from sales of forged, cast and fabricated railcar parts and supplies for all railcar types. Our Aftermarket segment also provides aftermarket services including safety training, railcar inspections, and preventative maintenance.
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Given steel prices are subject to volatility and make up a large portion of our cost of sales, we typically use supplier commitment and/or price escalation clauses to reduce the impact of steel volatility on our operating results. We manage material price increases by locking in prices where possible.
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Our costs and the demand for our products and services could also be impacted by the imposition of new tariffs and trade policies.
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Operating loss Operating loss represents revenues less cost of sales, loss on pension settlement, and selling, general and administrative expenses.
Added
We do not know at this time what effect the imposition of new tariffs and trade policies could have on our business, financial condition and results of operations, as the actual impact of new tariffs is subject to a number of factors including the duration of such tariffs, changes in the amount, scope and nature of the tariffs in the future, any countermeasures that the target countries may take, and any mitigating actions that may become available.
Removed
The decrease in Manufacturing segment revenues for 2023 compared to 2022 reflects a decrease in the number of railcars delivered from 3,184 railcars in 2022 to 3,022 railcars in 2023, primarily attributed to disruption in the movement of railcars between country borders.
Added
Aftermarket segment gross profit for the year ended December 31, 2024 was $8.6 million compared to $4.6 million for the year ended December 31, 2023. The $4.0 million increase in Aftermarket segment gross profit is primarily due to favorable volume and price mix.
Removed
During the year ended December 31, 2022, we recorded a pre-tax non-cash impairment charge of $4.5 million related to our small cube covered hopper railcars due to a proposal to purchase a portion of the railcars. See Note 7 – Leased Railcars to our consolidated financial statements.
Added
Aftermarket segment selling, general and administrative expenses included increases in labor expenses of $0.3 million, primarily due to an increase in headcount during the year, and consulting costs of $0.2 million. Corporate selling, general and administrative expenses were $29.4 million for the year ended December 31, 2024 compared to $24.7 million for the year ended December 31, 2023.
Removed
The increase in the loss was primarily driven by appreciation in the Company’s stock price during the year ended December 31, 2023 which is the primary driver in the valuation of the warrants.
Added
Corporate selling, general and administrative expenses for the year ended December 31, 2024 included increases in legal expenses of $2.4 million, stock-based compensation expenses of $1.9 million and insurance expenses of $0.4 million. Impairment on Leased Railcars There was no impairment on leased railcars for the year ended December 31, 2024.

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