American Railcar Industries, Inc.
Oct 30, 2013

American Railcar Industries, Inc. Reports Strong Third Quarter

Highlights

ST. CHARLES, Mo., Oct. 30, 2013 (GLOBE NEWSWIRE) -- American Railcar Industries, Inc. (ARI or the Company) (Nasdaq:ARII) today reported its third quarter 2013 financial results. "We are pleased with another quarter of strong financial performance and operating results, driven by continued strong tank railcar shipments along with a slight increase in hopper railcar shipments. The strong tank railcar mix generated operational leverage and efficiencies. As of September 30, 2013, we had a backlog of approximately 6,300 railcars. During October 2013, we accepted a multi-year order from Chevron Phillips Chemical Company LP for 2,750 plastic pellet covered hopper railcars for delivery from 2014 through 2016," said Jeff Hollister, President and Interim CEO of ARI.

Third Quarter Summary

Total consolidated revenues were $198.9 million for the third quarter of 2013, up 18% when compared to $168.2 million for the same period in 2012. Revenues increased across all three of the Company's segments, with the largest dollar increase in the manufacturing segment.

Total manufacturing segment revenues were $205.8 million for the third quarter of 2013, an increase of 11% over the $185.4 million for the same period in 2012. The primary reason for the increase was higher volumes of railcar shipments as well as strong tank railcar market conditions. Manufacturing segment revenues for the third quarter of 2013 included estimated revenues of $34.8 million related to railcars built for the Company's lease fleet, compared to estimated revenues of $38.2 million related to railcars built for the Company's lease fleet in the third quarter of 2012. Such revenues are based on an estimated fair market value of the leased railcars as if they had been sold to a third party, and are eliminated in consolidation. Revenues for railcars built for the Company's lease fleet are not recognized in consolidated revenues as railcar sales, but rather as lease revenues in accordance with the terms of the contract over the life of the lease. During the third quarter of 2013, ARI shipped approximately 1,640 railcars, including approximately 280 railcars built for the Company's lease fleet, compared to approximately 1,460 railcars for the same period of 2012, including approximately 310 railcars built for the lease fleet. Railcars built for the lease fleet represented approximately 17% of ARI's railcar shipments during the third quarter of 2013 compared to approximately 21% for the same period in 2012.

Total leasing segment revenues were $8.3 million for the third quarter of 2013, an increase of 95% over the $4.3 million for the same period in 2012. The primary reason for the increase in revenue was an increase in the number of railcars on lease and an increase in the average lease rate. ARI had approximately 3,780 railcars in the Company's lease fleet at the end of the third quarter of 2013, compared to approximately 2,190 railcars at the end of the same period in 2012.

Total railcar services segment revenues were $19.7 million for the third quarter of 2013, an increase of 16% over the $17.0 million for the same period in 2012. The increase is largely attributed to certain repair projects being performed at the Company's hopper railcar manufacturing facility during 2013.

Consolidated earnings from operations for the third quarter of 2013 were $35.6 million, an increase of 17% over the $30.3 million for the same period in 2012. The increase in consolidated earnings was primarily due to increased earnings across all three of the Company's segments, driven by higher revenues as discussed above, with the largest dollar increase in the manufacturing segment. Operating margins were 18% for both the third quarter of 2013 and 2012.

Manufacturing earnings from operations were $41.7 million for the third quarter of 2013 compared to $34.2 million for the same period in 2012. This increase was due primarily to an increase in railcar shipments and operating leverage as a result of strong tank railcar production volumes. Manufacturing earnings from operations for the third quarter of 2013 included $9.6 million of estimated profit on railcars built for the Company's lease fleet compared to $5.0 million for the same period in 2012, which is eliminated in consolidation and is based on an estimated fair market value of revenues as if the railcars had been sold to a third party, less the cost to manufacture.

EBITDA, adjusted to exclude share-based compensation and other income on short term investments (Adjusted EBITDA), was $43.3 million for the third quarter of 2013, compared to $36.7 million for the comparable quarter of 2012. The increase was driven by increased earnings from operations. A reconciliation of the Company's net earnings to EBITDA and Adjusted EBITDA (both non-GAAP financial measures) is set forth in the supplemental disclosure attached to this press release.

Net earnings for the third quarter of 2013 were $21.0 million, or $0.98 per share, compared to $14.0 million, or $0.66 per share, for the comparable quarter of 2012. The increase in earnings was primarily a result of increased earnings from operations across all three of the Company's segments, as discussed above, and lower interest expense. Interest expense was $1.5 million for the third quarter of 2013 compared to $4.4 million in the same period in 2012. The decrease was the result of a more favorable rate obtained on the Company's lease fleet financing and lower average debt balance as a result of the Company's early redemption of its 7.5% senior unsecured notes (Notes). During the quarter ended September 30, 2012, ARI redeemed $100.0 million of the outstanding Notes, resulting in a charge of $2.3 million, comprised of a premium of $1.9 million paid on the redemption of the debt and a non-cash charge of $0.4 million for the accelerated write-off of a portion of the deferred financing fees.

Year-to-Date Results

Consolidated revenues for the first nine months of 2013 were $553.4 million compared to $504.0 million for the comparable period in 2012.

Total manufacturing segment revenues were $611.5 million for the first nine months of 2013 compared to $616.5 million for the comparable period in 2012. The primary reasons for the decrease in revenues were lower covered hopper railcar shipments and lower revenues from certain material cost changes that ARI generally passes through to customers on a dollar for dollar basis. This combined decrease was partially offset by a higher mix of tank railcars shipped, which generally sell at higher prices due to more material and labor content, and improved general market conditions for tank railcars. Manufacturing segment revenues for the first nine months of 2013 included estimated revenues of $135.3 million relating to railcars built for the lease fleet, compared to estimated revenues of $170.3 million relating to railcars built for the lease fleet in the comparable period in 2012. Such revenues are based on an estimated fair market value of the leased railcars as if they had been sold to a third party, and are eliminated in consolidation. Revenues for railcars built for the Company's lease fleet are not recognized in consolidated revenues as railcar sales, but rather are recognized as lease revenues in accordance with the terms of the contract over the life of the lease. The Company shipped approximately 4,850 railcars, including approximately 1,190 railcars to leasing customers, during the first nine months of 2013, which was 17% lower than the approximately 5,870 railcars shipped during the same period of 2012, of which 1,690 were to leasing customers. Railcars built for the lease fleet represented approximately 25% and 29% of ARI's total railcar shipments in the first nine months of 2013 and 2012, respectively.

Consolidated earnings from operations for the first nine months of 2013 were $106.7 million, up 33% from $80.1 million for the comparable period in 2012. Consolidated earnings from operations for the first nine months of 2013 and 2012 excluded $29.5 million and $28.3 million, respectively, of profit on railcars built for the lease fleet which is eliminated in consolidation and is based on an estimated fair market value of revenues as if the railcars had been sold to a third party, less the cost to manufacture. Operating margins were 19% for the first nine months of 2013 compared to 16% for the comparable period of 2012.

The Company recorded a loss from joint ventures of $2.3 million for the first nine months of 2013 compared to break-even earnings for the comparable period in 2012. The increase in the Company's joint venture loss during the nine month period ended September 30, 2013 was due to production levels decreasing from 2012 levels on weak demand for railcar types other than tank railcars for ARI's domestic joint ventures. Additionally, the Company's India joint venture incurred higher interest expense and higher depreciation expense in 2013 compared to 2012 due to the completion of construction of the manufacturing plant in India.

Adjusted EBITDA was $129.1 million for the first nine months of 2013, up by $27.6 million from $101.5 million for the comparable period in 2012.

Net earnings for the first nine months of 2013 were $62.5 million, or $2.93 per share, compared to $39.4 million, or $1.84 per share, for the comparable period in 2012. This increase was due to higher earnings from operations as well as a 60% decrease in interest expense for the nine months ended September 30, 2013, compared to the same period in 2012. The decrease in interest expense was a result of a lower interest rate secured on the lease fleet financing and a lower average debt balance due to the Company's early redemption of the Notes. Offsetting these increases to earnings was a non-cash charge of $0.4 million for the accelerated write-off of a portion of the deferred financing fees due to the Company's early redemption of the remaining $175 million of its Notes in March 2013. This charge recognized during the nine months ended September 30, 2013 was $1.9 million lower than the $2.3 million charge incurred during the nine months ended September 30, 2012, related to the redemption of the initial $100.0 million of Notes, as discussed above.

Cash Flow and Liquidity

The Company's strong earnings have contributed to cash flow from operations of $118.0 million during the first nine months of 2013. As a result of continued growth of the Company's lease fleet and redemption of the remaining $175 million of the Notes during the first quarter of 2013, partially offset by borrowings under the lease fleet financing, the Company's cash balance was $115.0 million at September 30, 2013.

At the board meeting in October, the Company's board of directors declared a cash dividend of $0.25 per share of common stock of the Company to shareholders of record as of December 13, 2013 that will be paid on December 20, 2013.

Backlog

ARI's backlog as of September 30, 2013 was approximately 6,300 railcars, with an estimated market value of $814.5 million. This backlog includes approximately 2,430 railcars for lease with an estimated market value of $331.5 million.

Conference Call and Webcast

ARI will host a webcast and conference call on Thursday, October 31, 2013 at 10:00 am (Eastern Time) to discuss the Company's third quarter 2013 financial results. To participate in the webcast, please log-on to ARI's investor relations page through the ARI website at www.americanrailcar.com. To participate in the conference call, please dial 877-745-9389. Participants are asked to log-on to the ARI website or dial in to the conference call approximately 10 to 15 minutes prior to the start time. An audio replay of the call will also be available on the Company's website promptly following the earnings call.

About ARI

ARI is a leading North American designer and manufacturer of hopper and tank railcars. ARI and its subsidiaries sell and lease railcars manufactured by the Company to certain markets. In addition, ARI repairs and refurbishes railcars, provides fleet management services and designs and manufactures certain railcar and industrial components. ARI provides its railcar customers with integrated solutions through a comprehensive set of high quality products and related services. More information about American Railcar Industries, Inc. is available on its website at www.americanrailcar.com.

Forward Looking Statement Disclaimer

This press release contains statements relating to expected financial performance and/or future business prospects, events and plans that are forward-looking statements. Forward-looking statements represent the Company's estimates and assumptions only as of the date of this press release. Such statements include, without limitation, statements regarding industry trends, customer demand for the Company's products, the Company's leadership roles and capabilities; the Company's strategic objectives and long-term strategies, the growth of the Company's leasing business, anticipated future production rates, the Company's plans regarding future dividends, the Company's joint ventures, the Company's backlog and any implication that the Company's backlog may be indicative of future revenues. These forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from the results described in or anticipated by the Company's forward-looking statements. The payment of future dividends, if any, and the amount thereof, will be at the discretion of ARI's board of directors and will depend upon the Company's operating results, strategic plans, capital requirements, financial condition, provisions of its borrowing arrangements, applicable law and other factors the Company's board of directors considers relevant. Other potential risks and uncertainties include, among other things: basing financial or other information on judgments or estimates based on future performance or events; the ability to successfully manage the day-to-day aspects of the Company's business, including the ability of the Company to successfully attract, motivate and retain executive officers and key employees, both individually and as a group; the impact of an economic downturn, adverse market conditions and restricted credit markets; ARI's reliance upon a small number of customers that represent a large percentage of revenues and backlog; the health of and prospects for the overall railcar industry; prospects in light of the cyclical nature of the railcar manufacturing business; the highly competitive nature of the railcar manufacturing, railcar leasing and railcar services industries; the conversion of ARI's railcar backlog into revenues; anticipated trends relating to shipments, leasing, railcar services, revenues, financial condition or results of operations; the anticipated production schedules for our products and the anticipated financing needs, construction and production schedules of our joint ventures; the risks associated with international operations and joint ventures; the Company's ability to manage overhead and variations in production rates; fluctuating 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 that ARI uses in railcar manufacturing; the risk of being unable to market or remarket railcars for sale or lease at favorable prices or on favorable terms or at all; the ongoing benefits and risks related to the Company's relationship with Mr. Carl Icahn (the chairman of the Company's board of directors and, through his holdings of Icahn Enterprises L.P., the Company's principal beneficial stockholder) and certain of his affiliates; the risks, impact and anticipated benefits associated with potential joint ventures, acquisitions or new business endeavors; the implementation, integration with other systems or ongoing management of the Company's new enterprise resource planning system; the risk of the lack of acceptance of new railcar offerings by ARI's customers and the risk of initial production costs for the Company's new railcar offerings being significantly higher than expected; the sufficiency of the Company's liquidity and capital resources; compliance with covenants contained in the Company's financing arrangements; the impact and costs and expenses of any litigation ARI may be subject to now or in the future; and the additional risk factors described in ARI's filings with the Securities and Exchange Commission. The Company expressly disclaims 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.

 
AMERICAN RAILCAR INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
 
 
  September 30,
2013
December 31,
2012
  (unaudited)  
Assets    
Current assets:    
Cash and cash equivalents $ 115,020 $ 205,045
Short-term investments—available for sale securities 12,557
Accounts receivable, net 30,739 36,100
Accounts receivable, due from related parties 12,844 3,539
Inventories, net 102,051 110,075
Deferred tax assets 11,777 4,114
Prepaid expenses and other current assets 7,724 3,917
Total current assets 280,155 375,347
Property, plant and equipment, net 157,429 155,893
Railcars on operating leases, net 321,608 220,282
Deferred debt issuance costs 2,029 2,374
Goodwill 7,169 7,169
Investments in and loans to joint ventures 40,190 44,536
Other assets 8,028 4,157
Total assets $ 816,608 $ 809,758
Liabilities and Stockholders' Equity    
Current liabilities:    
Accounts payable $ 58,038 $ 64,971
Accounts payable, due to related parties 1,486 2,831
Accrued taxes 7,252 2,693
Accrued expenses 23,123 5,739
Accrued compensation 16,639 17,940
Accrued interest expense 299 4,465
Short-term debt, including current portion of long-term debt 6,655 2,755
Total current liabilities 113,492 101,394
Long-term debt, net of current portion 189,762 272,245
Deferred tax liability 84,597 53,466
Pension and post-retirement liabilities 8,923 9,518
Other liabilities 5,326 3,670
Total liabilities 402,100 440,293
Commitments and contingencies    
Stockholders' equity:    
Common stock, $0.01 par value, 50,000,000 shares authorized, 21,352,297 shares issued and outstanding as of both September 30, 2013 and December 31, 2012 213 213
Additional paid-in capital 239,609 239,609
Retained earnings 176,541 130,030
Accumulated other comprehensive loss (1,855) (387)
Total stockholders' equity 414,508 369,465
Total liabilities and stockholders' equity $ 816,608 $ 809,758
 
 
AMERICAN RAILCAR INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts, unaudited)
 
 
  Three Months Ended 
 September 30,
Nine Months Ended 
 September 30,
  2013 2012 2013 2012
Revenues:        
Manufacturing (including revenues from affiliates of $65,678 and $148,660 for the three and nine months ended September 30, 2013, respectively, and $49,962 and $60,859 for the same periods in 2012) $ 170,943 $ 147,212 $ 476,160 $ 446,273
Railcar leasing 8,301 4,267 22,371 8,315
Railcar services (including revenues from affiliates of $4,307 and $13,461 for the three and nine months ended September 30, 2013, respectively, and $5,855 and $16,858 for the same periods in 2012) 19,655 16,751 54,882 49,455
Total revenues 198,899 168,230 553,413 504,043
Cost of revenues:        
Manufacturing (136,974) (116,497) (371,806) (360,507)
Railcar leasing (3,524) (1,854) (9,729) (4,196)
Railcar services (15,614) (13,181) (43,063) (38,849)
Total cost of revenues (156,112) (131,532) (424,598) (403,552)
Gross profit 42,787 36,698 128,815 100,491
Selling, general and administrative (including costs to a related party of $268 and $864 for the three and nine months ended September 30, 2013, respectively, and $146 and $441 for the same periods in 2012) (7,161) (6,360) (22,091) (20,388)
Earnings from operations 35,626 30,338 106,724 80,103
Interest income (including income from related parties of $669 and $2,026 for the three and nine months ended September 30, 2013, respectively, and $727 and $2,201 for the same periods in 2012) 672 750 2,042 2,297
Interest expense (1,512) (4,414) (5,853) (14,630)
Loss on debt extinguishment (2,267) (392) (2,267)
Other income (including income from a related party of $5 and $14 for the three and nine months ended September 30, 2013, respectively, and $4 and $10 for the same periods in 2012) 16 18 2,024 37
(Loss) earnings from joint ventures (505) (849) (2,282) 31
Earnings before income taxes 34,297 23,576 102,263 65,571
Income tax expense (13,327) (9,566) (39,737) (26,196)
Net earnings $ 20,970 $ 14,010 $ 62,526 $ 39,375
Net earnings per common share—basic and diluted $ 0.98 $ 0.66 $ 2.93 $ 1.84
Weighted average common shares outstanding—basic and diluted 21,352 21,352 21,352 21,352
Cash dividends declared per common share $ 0.25 $ — $ 0.75 $ —
 
 
AMERICAN RAILCAR INDUSTRIES, INC. AND SUBSIDIARIES
SEGMENT DATA
(In thousands, unaudited)
 
 
  Revenues Earnings (Loss) from Operations
  External Intersegment Total External Intersegment Total
Three Months Ended September 30, 2013            
Manufacturing $ 170,943 $ 34,824 $ 205,767 $ 32,075 $ 9,633 $ 41,708
Railcar Leasing 8,301 8,301 4,155 5 4,160
Railcar Services 19,655 31 19,686 3,292 (13) 3,279
Corporate/Eliminations (34,855) (34,855) (3,896) (9,625) (13,521)
Total Consolidated $ 198,899 $ — $ 198,899 $ 35,626 $ — $ 35,626
Three Months Ended September 30, 2012            
Manufacturing $ 147,212 $ 38,178 $ 185,390 $ 29,206 $ 5,012 $ 34,218
Railcar Leasing 4,267 4,267 2,377 6 2,383
Railcar Services 16,751 221 16,972 2,955 (46) 2,909
Corporate/Eliminations (38,399) (38,399) (4,200) (4,972) (9,172)
Total Consolidated $ 168,230 $ — $ 168,230 $ 30,338 $ — $ 30,338
Nine Months Ended September 30, 2013            
Manufacturing $ 476,160 $ 135,315 $ 611,475 $ 98,834 $ 29,541 $ 128,375
Railcar Leasing 22,371 22,371 9,963 17 9,980
Railcar Services 54,882 126 55,008 9,680 (11) 9,669
Corporate/Eliminations (135,441) (135,441) (11,753) (29,547) (41,300)
Total Consolidated $ 553,413 $ — $ 553,413 $ 106,724 $ — $ 106,724
Nine Months Ended September 30, 2012            
Manufacturing $ 446,273 $ 170,267 $ 616,540 $ 80,692 $ 28,280 $ 108,972
Railcar Leasing 8,315 8,315 3,994 19 4,013
Railcar Services 49,455 441 49,896 8,694 (96) 8,598
Corporate/Eliminations (170,708) (170,708) (13,277) (28,203) (41,480)
Total Consolidated $ 504,043 $ — $ 504,043 $ 80,103 $ — $ 80,103
 
 
AMERICAN RAILCAR INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
 
 
  Nine Months Ended September 30,
  2013 2012
Operating activities:    
Net earnings $ 62,526 $ 39,375
Adjustments to reconcile net earnings to net cash provided by operating activities:    
Depreciation 20,433 17,506
Amortization of deferred costs 486 487
Loss on disposal of property, plant and equipment 75
Share-based compensation 4,240 3,810
Change in interest receivable, due from related parties 292
Loss (earnings) from joint ventures 2,282 (31)
Provision for deferred income taxes 23,997 24,703
Adjustment to provision for losses on accounts receivable 14 108
Items related to investing activities:    
Realized gain on sale of short-term investments - available for sale securities (2,008)
Items related to financing activities:    
Loss on debt extinguishment 392 2,267
Changes in operating assets and liabilities:    
Accounts receivable, net 5,329 (1,995)
Accounts receivable, due from related parties (9,315) (1,428)
Income taxes receivable (187) (282)
Inventories, net 7,994 (36,486)
Prepaid expenses and other current assets 157 (754)
Accounts payable (6,927) 5,114
Accounts payable, due to affiliates (1,345) 150
Accrued expenses and taxes 11,665 (5,119)
Other (1,779) (364)
Net cash provided by operating activities 118,029 47,353
Investing activities:    
Purchases of property, plant and equipment (15,343) (10,444)
Capital expenditures - leased railcars (108,314) (143,242)
Proceeds from the sale of property, plant and equipment 2 254
Purchase of short-term investments - available for sale securities
Proceeds from the sale of short-term investments - available for sale securities 12,699
Proceeds from repayments of loans by joint ventures 2,100 1,592
Investments in and loans to joint ventures (136) (1,652)
Net cash used in investing activities (108,992) (153,492)
Financing activities:    
Repayments of long-term debt (178,424) (100,000)
Premium on debt redemption (1,875)
Proceeds from long-term debt 99,841
Change in interest reserve related to long-term debt (3,965)
Payment of common stock dividends (16,014)
Debt issuance costs (432)
Net cash used in financing activities (98,994) (101,875)
Effect of exchange rate changes on cash and cash equivalents (68) 37
Decrease in cash and cash equivalents (90,025) (207,977)
Cash and cash equivalents at beginning of period 205,045 307,172
Cash and cash equivalents at end of period $ 115,020 $ 99,195
 
 
AMERICAN RAILCAR INDUSTRIES, INC. AND SUBSIDIARIES
RECONCILIATION OF NET EARNINGS TO EBITDA AND ADJUSTED EBITDA
(In thousands, unaudited)
 
 
  Three Months Ended 
 September 30,
Nine Months Ended 
 September 30,
  2013 2012 2013 2012
Net earnings $ 20,970 $ 14,010 $ 62,526 $ 39,375
Income tax expense 13,327 9,566 39,737 26,196
Interest expense 1,512 4,414 5,853 14,630
Loss on debt extinguishment 2,267 392 2,267
Interest income (672) (750) (2,042) (2,297)
Depreciation 7,038 6,220 20,433 17,506
EBITDA $ 42,175 $ 35,727 $ 126,899 $ 97,677
Other income related to short-term investments (2,008)
Stock appreciation rights compensation expense 1,165 997 4,240 3,810
Adjusted EBITDA $ 43,340 $ 36,724 $ 129,131 $ 101,487

EBITDA represents net earnings before income tax expense, interest expense (income), loss on debt extinguishment and depreciation of property, plant and equipment. The Company believes EBITDA is useful to investors in evaluating ARI's operating performance compared to that of other companies in the same industry. In addition, ARI's management uses EBITDA to evaluate operating performance. The calculation of EBITDA eliminates the effects of financing, income taxes and the accounting effects of capital spending. These items may vary for different companies for reasons unrelated to the overall operating performance of a company's business. EBITDA is not a financial measure presented in accordance with U.S. generally accepted accounting principles (U.S. GAAP). Accordingly, when analyzing the Company's operating performance, investors should not consider EBITDA in isolation or as a substitute for net earnings, cash flows provided by operating activities or other statement of operations or cash flow data prepared in accordance with U.S. GAAP. The calculation of EBITDA is not necessarily comparable to that of other similarly titled measures reported by other companies.

Adjusted EBITDA represents EBITDA before stock appreciation rights (SARs) compensation expense and other income related to our short-term investments. Management believes that Adjusted EBITDA is useful to investors in evaluating the Company's operating performance, and therefore uses Adjusted EBITDA for that purpose. The Company's SARs, which settle in cash, are revalued each period based primarily upon changes in ARI's stock price. Management believes that eliminating the expense associated with share-based compensation and income associated with short-term investments allows management and ARI's investors to understand better the operating results independent of financial changes caused by the fluctuating price and value of the Company's common stock and short-term investments. Adjusted EBITDA is not a financial measure presented in accordance with U.S. GAAP. Accordingly, when analyzing operating performance, investors should not consider Adjusted EBITDA in isolation or as a substitute for net earnings, cash flows provided by operating activities or other statements of operations or cash flow data prepared in accordance with U.S. GAAP. The Company's calculation of Adjusted EBITDA is not necessarily comparable to that of other similarly titled measures reported by other companies.

CONTACT: Dale C. Davies

         Michael Obertop

         636.940.6000
Source: American Railcar Industries, Inc.

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