FreightCar America (RAIL) investor relations material

Company overview and strategy

• Focuses exclusively on railcar manufacturing, not leasing, with a 125-year history and recent expansion into aftermarket parts and services.

• Manufacturing moved to Mexico in 2019, enabling cost efficiencies and flexible production capacity up to 7,500 units with minimal investment.

• Product portfolio covers about 70% of the market, with leading positions in open-top hoppers and significant growth in covered hoppers and flatcars.

• Differentiates through engineering expertise, shared components, and ability to customize for leasing companies, railroads, and private owners.

• Aftermarket business expanded via acquisitions, providing less cyclical revenue and leveraging regulatory-driven demand for parts and maintenance.

Market position and performance

• Achieved 47% market share in Q2 2024 for all orders placed, up from 13% the previous year, with a historical average of 5-6%.

• Market share surge attributed to focus on customer pain points, product customization, and agility rather than price competition.

• Not expected to sustain 47% share as industry recovers; targets 18% share in a normalized 40,000-unit market.

• Industry currently in a trough, with 2026 orders projected at 25,000-26,000 units, but expected to rebound to 40,000 units by 2028.

• Maintained stable shipments and EBITDA through the downturn, outperforming industry peers who saw significant volume declines.

Operational strengths and financials

• Flexible manufacturing allows multiple product types on the same line, reducing inventory and lead times to as little as six weeks.

• Vertically integrated production and automation (robotic welding, digital quality tracking) enhance cost control and agility.

• Inventory cycle reduced to approximately 60 days.

• End-2025 cash position at $64.3 million, total debt $107 million, annual CapEx 1% of revenue, and net leverage below 3x.

• FX risk managed through hedging, and major anti-dilutive warrants have been exercised, supporting a higher market cap.