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FreightCar America,
Inc. Completes Restatement of Prior Period Financial Statements Sep. 16, 2009 (Business
Wire) -- On September 16, 2009, the Company filed an amended annual report on
Form 10-K/A with the SEC to restate its financial statements for the years
ended December 31, 2008 and 2007, and for the quarterly periods ended March
31, 2008, June 30, 2008 and September 30, 2008. On that date, the Company also
filed an amended quarterly report on Form 10-Q/A with the SEC to restate its
quarterly financial statements for the period ended March 31, 2009. The following summarizes
the adjustments to the reported amounts (in thousands) of FreightCar
America’s total liabilities and net income for 2007 and 2008 and the first
quarter of 2009. The complete restated financial statements for all affected
periods are included in the filings referenced above, which are available on
the SEC’s website.
In connection with its
review of these accounting errors, the Company determined that it had control
deficiencies pertaining to systems change controls, inventory valuation
controls and account reconciliation controls that constituted material
weaknesses. The Company identified the accounting errors in connection with
the implementation of a new enterprise-wide reporting and management software
platform, or ERP system, to improve processes and strengthen these controls
throughout the Company. Further descriptions of these deficiencies, as well
as the Company’s efforts to remediate them, are included in the Forms 10-K/A
and 10-Q/A described above. The restatement has caused
the Company to fail to comply with certain representations and covenants in
its two credit facilities. On August 7, 2009, the Company received waivers of
these representations and covenants from the lenders under these credit
facilities. These waivers are subject to the condition that the Company
comply with the representations and covenants by September 30, 2009. Chris Ragot,
President and Chief Executive Officer of FreightCar
America, stated, “We are pleased with the manner in which we have resolved
this issue. The actual amount of the overstatement of our accounts payable
was consistent with our preliminary assessment, and we have worked diligently
to meet our timeline for resolving the issue and restating our financial
results before the end of the third quarter. Most importantly, this issue has
not affected our ability to effectively run the business and we remain
focused on working towards our long-term strategic goals.” Second Quarter Earnings
Announcement The Company will issue a
press release on Tuesday, September 22, 2009 and will host a conference call
at 11:00 a.m. (Eastern Daylight Time) on the same day to discuss the
Company's second quarter financial results. To participate in the conference
call, please dial (800) 288-8961. Interested parties are asked to dial in
approximately 10 to 15 minutes prior to the start time of the call. An audio replay of the
conference call will be available beginning at 1:00 p.m. (Eastern Daylight
Time) on September 22, 2009 until 11:59 p.m. (Eastern Daylight Time) on
October 22, 2009. To access the replay, please dial (800) 475-6701. The
replay pass code is 115800. An audio replay of the call will be available on
the Company’s website within two days following the earnings call. FreightCar America, Inc. manufactures
railroad freight cars, with particular expertise in coal-carrying railcars.
In addition to coal cars, FreightCar America
designs and builds bulk commodity cars, flat cars, mill gondola cars,
intermodal cars, coil steel cars and motor vehicle carriers. It is
headquartered in Chicago, Illinois and has manufacturing facilities in
Danville, Illinois and Roanoke, Virginia. More information about FreightCar America is available on its website at
www.freightcaramerica.com. This press release contains
statements that are “forward-looking statements” as defined under the Private
Securities Litigation Reform Act of 1995. Forward-looking statements
represent our estimates and assumptions only as of the date of this press
release. Our actual results may differ materially from the results described
in or anticipated by our forward-looking statements due to certain risks and
uncertainties. These potential risks and uncertainties include, among other
things: the cyclical nature of our business; adverse economic and market
conditions; fluctuating costs of raw materials, including steel and aluminum,
and 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 acceptance of customer orders; the highly competitive nature of
our industry; the risk of lack of acceptance of our new railcar offerings by
our customers; and the additional risk factors described in our filings with
the Securities and Exchange Commission. We expressly disclaim any duty to
provide updates to any forward-looking statements made in this press release,
whether as a result of new information, future events or otherwise. More
information about FreightCar America is available
on its website at www.freightcaramerica.com.
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