L.B. Foster Company (NASDAQ:FSTR) saw its stock drop Monday, on the release of end-of-year financials.
The Pittsburgh-based Foster is a leading manufacturer and distributor of products and services for transportation and energy infrastructure.
Net loss was $31.2 million, or $3.01 loss per diluted share, settlement of the concrete tie warranty claim with Union Pacific Railroad.
Results include $43.4 million expense recognized as a result of the settlement.
New orders for 2018 increased 24.6% from the prior year. Sales increased by 16.9% to $627.0 million compared to the prior year.
Meanwhile, 2018 gross profit of $117.2 million increased $11.9 million, or 11.3%, compared to 2017.
Prior to the effects of the Settlement Agreement, the Company had previously accrued $6.6 million for concrete tie warranty replacements.
Therefore, the Company recognized $43.4 million in expense for the year ended December 31, 2018 for the remaining amount per the Settlement Agreement.
Net cash provided by operating activities for the year ended December 31, 2018 totaled $26.0 million compared to $39.4 million in the prior year period, a $13.4 million decline. This decrease was primarily related to a tax refund of $11.8 million during 2017 that did not reoccur in 2018.
Total debt was reduced by $55.0 million, or 42.3%, to $75.0 million as of December 31, 2018, compared to total debt as of December 31, 2017
CEO Bob Bauer commented, "The Company has reached a settlement with Union Pacific for warranty claims related to previously manufactured concrete ties at our Grand Island, Nebraska facility. I am pleased that we found a way to settle this dispute that restores the commercial relationship between our two companies."
Shares dropped 56 cents, or 3.1%, to $17.44
