Wabtec Corporation, based in Pittsburgh, had a better than expected first quarter of the year due to the sustained and increased global demand for locomotives and freight train equipment.
Wabtec, which produces locomotives, freight cars, and railroad equipment, announced during its earnings call Wednesday that the net sales of the freight segment had increased by 18.5% compared to the first quarter of this year. During the first quarter of the year, the company's freight segment saw net sales of over $1.5 billion. This is up from $1.3 billion during the same period last year.
Rafael Santana, Wabtec's CEO and president, said in a conference call that sales of all product lines have increased for the freight segment. This segment also includes the transit-related segment. The company's sales grew in particular for components, digital intelligence, and equipment.
The company's transit segment, which is mentioned above, also experienced growth in the most recent quarter. Its net sales reached $628 million and were up 3.8% on the $605 million sales it had in the previous year.
Wabtec’s 12-month order backlog also increased during the quarter, by 4.4% over the previous year. It now stands at $6.9 billion as opposed to $6.6 billion in Q1 2020.
Santana stated that visibility was good for the pipeline of opportunities, and the ability to continue driving revenue growth through the combination of modernizations and equipment. Santana said that there was good visibility and visibility of the 12-month backlog. This gave him confidence in the ability to convert into 2023, and even into the early part of 2024.
Wabtec has achieved GAAP earnings of $0.93 per diluted share, an increase of 16.3% over the first quarter 2022. The GAAP gross profit margin for the quarter was 30,3%. Total net sales for the quarter reached $2.19 Billion, an increase of almost 14% over the $1.92 Billion it achieved in the first quarter 2022. This exceeded analyst expectations of $2.12 Billion.
Santana stated, "I'm pleased with the progress we have made. However, we still need to do a lot of work to streamline the footprint in order to increase and sustain margins." "I believe you will continue to see some variations quarter to quarter. But we are working to drive margin growth in the year, both for transit and our freight business." I believe the fundamentals of transit are strong; we see that [transit] authorities continue to invest. Infrastructure spending is a positive in this area. "And] government spending on rail and our OEM customers have a strong backlog, which continues driving opportunities for us."