Ladies and gentlemen, thank you for standing by. Welcome to FreightCar America’s Fourth Quarter 2013 Earnings Conference Call and Webcast. At this time, all participant lines are in a listen-only mode. For those of you participating on the conference call, there will be an opportunity for your questions at the end of today’s prepared comments. Please note, that this conference is being recorded. An audio replay of the conference call will be available from 1 PM Eastern Standard Time today until 11:59 AM on March 19, 2014. To access the replay, please dial 800-475-6701. The replay pass code is 318803. An audio replay of the call will be available on the company’s website within two days following this earnings call. I would now like to turn the call over to Mr. Chip Avery, Chief Financial Officer of FreightCar America.

Thank you and welcome to FreightCar America’s fourth quarter 2013 earnings conference call and webcast. Joining me today are Joe McNeely, President and CEO and Ted Baun, Senior Vice President, Marketing and Sales. I’d like to remind everyone that statements made during this conference call relating to the company’s expected future performance, future business prospects, or future events or plans may include forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Participants are directed to FreightCar America’s 2012 Form 10-K for a description of certain business risks, some of which may be outside the control of the company that may cause actual results to materially differ from those expressed in the forward-looking statements. We expressly disclaim any duty to provide updates to our forward-looking statements, whether as a result of new information, future events or otherwise. Our 2012 Form 10-K and earnings release for the fourth quarter of 2013 are posted on the company’s website at freightcaramerica.com. Let me now turn the call over to Joe McNeely.

Thank you, Chip. 2013 was the transformational year for FreightCar America, as the Company completed several strategic initiatives the time to grow the long-term value of the Company. The continued soft freight car demand and a number of accounting charges had a negative impact on our financial performance this past quarter. Despite financial results, which Chip will discuss some more details shortly, 2013 included a number of successes related to our future enquiry. The startup of our Shoals facility, expansion of our product offering, maintaining our status as a market leader in coal car manufacturing, improving the contribution of our services business and advancing our presence in select international markets. As we’ve stated, expanding our product offerings is key to our long-term success and we made good progress on that front. The current backlog includes a variety of new car types including intermodal railcars, flat cars and covered hopper railcars. And our new product development team continues to work on designs for several other car types. The Shoals facility, our primary plant for these new car types started up on time and is about to complete its third order. The build out and ramp-up will continue with the final build out expected to be completed by mid-year. While this will be an efficient facility once complete, margins as we ramp-up will respectively be lower than it will be at normal production volumes. In our traditional market, 2013 was a difficult year for coal. With loadings, production and export all down compared to 2012. And we’ll have a few comments on this in a moment. With a continued pressure from natural gas, in an unfavorable regulatory environment our new coal-fired power plant, the outlook for newly manufactured Western Railroads cars looks to be soft for sometimes. However, the Eastern Railroads continue…

Thank you, Joe. To recap order activity for the period, 800 railcars of various types were ordered in the fourth quarter of 2013. This compares to 473 units ordered in the fourth quarter of 2012 and 6,001 railcars order in the third quarter of 2013. As some of you will recall, the third quarter included rebuild orders for approximately 4,000 railcars. Fourth quarter 2013 deliveries of 1,101 railcars included 190 new, 99 used and 812 rebuilt railcars. This compares to 1,308 railcars delivered in the fourth quarter of 2012, including 528 new cars and 780 rebuilt railcars. There were 937 railcars delivered in the third quarter of 2013, of which 194 were new and 743 were rebuilds. Our backlog of unfulfilled orders at December 31 2013, 6,826 railcars slightly down from 7,129 railcars at September 30, 2013. Our backlog at December 31, 2012 was 2,881 railcars. As Joe said, we have made good progress on our new product development efforts, and close to half of the current backlog is comprised as non-coal railcars. Industry-wide 14,865 units were ordered and 15,776 units were delivered in the fourth quarter of 2013. Orders and deliveries were up from the fourth quarter of 2012 as well as the third quarter of 2013. Industry-wide backlog was 72,937 units at the end of December relatively flat compared to the end of September and up from a year ago. After a year dominated by strengthened energy market approximately 75% of the year-end backlog consists of tank cars. Non-tank car demand improved with 9,949 railcars ordered in the fourth quarter compared to 7,603 railcars ordered in the third quarter. A large portion of the fourth quarter orders were for covered hopper cars. Deliveries for non-tank cars also increased slightly to 7,336 units, from 5,100 units in the third…

Thank you, Ted. For the quarter of 2013, consolidated revenues were $79.7 million compared to $116.6 million in the fourth quarter of 2012. The net loss for the fourth quarter of 2013 was $12.3 million or a loss of $1.03 per diluted share. The net loss for the fourth quarter of 2012 was $1 million or $0.08 per diluted share. Fourth quarter of 2013 results included several notable charges. We booked a total of $10.5 million of restructuring and non-cash impairment charges in the fourth quarter. Included in these charges was an impairment charge of $7.6 million to write-down certain assets at the Danville facility. This charge was taken based on the current industry outlook for the coal car market and does not indicate any plans to close that facility. We also recorded a $1.9 million charge for the closure of our Clinton, Indiana maintenance and repair shop. Corporate costs included severance expense totaling $1.3 million. For the full year of 2013, consolidated revenues were $290 million compared to $677 million in 2012. Consolidated net loss was $19.3 million or a loss of a $1.61 per diluted share compared to net income of $19.1 million or income of $1.60 per diluted share. The Manufacturing segment revenues for the fourth quarter of 2013 were $72 million compared to $109 million in the fourth quarter of 2012. Year-over-year decrease in revenues reflects a lower number of cars delivered and lower average revenue per car given the high number of rebuilds in 2013. The operating loss for the manufacturing segment for the fourth quarter of 2013 was $8.7 million, including the restructuring and impairment charges previously mentioned. This compares to operating income of $6.5 million in the fourth quarter of 2012. The fourth quarter of 2013 results included a $1.7 million charge for…

(Operator Instructions) And first one is from Michael Gallo with CL King. Please go ahead. Michael W. Gallo – C.L. King & Associates, Inc.: Hi, good morning.

Good morning, Michael. Michael W. Gallo – C.L. King & Associates, Inc.: Just had a couple of questions; I wanted to drill in a little bit on the gross margin line a little more on what happened there in the quarter, obviously you have this order that, you guys projected costs that are higher than, so more background there on kind of what happened whether we should view this as an isolated event and then also on that front how much was the Clinton facility losing and how much did you expect the closure of that to help from a margin standpoint going forward. Thank you.

Let me take the first part and Chip can address the Clinton. As it relates to the manufacturing cost, the one item that Chip noted in his comments was in order where we had really tight deadlines and the work with the customers we had enforced, product where we normally wouldn’t. So I wouldn’t expect to see that repeat itself again. Chip also mentioned that there were some other production and efficiencies in costs. In the quarter there were certain maintenance costs, operation and supply costs et cetera that were higher than we would have expected and higher than in prior quarters. Michael W. Gallo – C.L. King & Associates, Inc.: I was going to say, just as a follow up on that first part, should we expect then more when you look at the way the backlog looks today and the production runs that we should see perhaps gross margin is at a more similar level what you saw in the third quarter obviously getting better as revenues move up?

Again without giving specific financial guidance, margins probably go back to where we are seeing more of where they have in the past, but again that depends on the current mix that’s out there. Remember, in 2014 as Ted said, half of the backlog is our rebuilt which have a lower revenue number, but I got the same kind of margin percentage, the margin dollar could be lower. Michael W. Gallo – C.L. King & Associates, Inc.: All right, and I understand that, but in just general. And then I guess the second part on Clinton?

Sure. So the Clinton facility as we look at the sort of the drag in 2013, it’s a very small facility, top-line was about $2 million, the operating loss was slightly less than $1 million in 2013. So again we see that going away, the facility has held for sale and it has been written down as and a big part of the charge at year-end was an impairment or a write-down of the facility to book value. So, and sort of that’s a release during 2014. Michael W. Gallo – C.L. King & Associates, Inc.: In terms of the $2 million, would you expect to be able to pickup any of that revenue in your other facilities, do you expect that revenue will go away?

I expect to go away. It’s in a different part of the country than our two Nebraska facilities, but I expect most of that goes away. Michael W. Gallo – C.L. King & Associates, Inc.: All right, okay, thank you.

Next we will go to Justin Long with Stephens. Please go ahead. Justin Long – Stephens, Inc.: Thanks. Good morning guys. I was wondering if you could talk about the marketing efforts for Shoals. I’m just curious how much of your efforts have been on the product development side versus going out in marketing these new products with some of the big customers and any detail you have on initial feedback from customers purchasing the railcars from this facility would be helpful as well.

Sure Justin, this is Ted. It’s an effort when we look to fill Shoals and develop products, it’s obviously outside sales, it’s marketing, and it’s a large part of engineering resources. So we’re moving ahead on all fronts. As we’ve said in the prepared remarks, it’s covered hopper cars, variety of different sizes, further intermodal flat cars they were looking to develop and ultimately put into that plant and I would say that customers have been very receptive to our design efforts, our end product and the prospects for the plant. Justin Long – Stephens, Inc.: Thanks, Ted. That’s helpful. And – in terms of the increase for Shoals, what do they look like as it relates to size? Are you typically seeing increase in the hundreds of units or are they smaller than that?

I’m not going to comment on any particular size of enquiry, but I will say that on average, we are seeing enquiries about where they were through Q3 and Q4 and a slight uptick as we enter 2014. So we are seeing a bit of improvement across the Board with FreightCar enquiries. And obviously we will decide where to put those be it Shoals, Roanoke, or potentially Danville as we move forward.

And just Justin, there is just one thing to elaborate a little more, I mean that car types are going into Shoals are different than our traditional coal car types which we had been ordered in about thousands. So, the expectation is the order lots are probably on average smaller than what we would have experienced in the past. Justin Long – Stephens, Inc.: Okay, great. And, if you think about your guidance for about 7,000 railcars deliveries this year, is there a way to the break that out between what you expect to deliver in Roanoke versus Shoals?

We don’t comment on specific plants, productions and backlog Justin. Justin Long – Stephens, Inc.: Okay, fair enough. And I had one question on the balance sheet, if you could provide some detail on your CapEx expectations for this year and just given the current backlog what your expectations for the cash balance as we move throughout the year as well would be helpful?

So, in terms of the 2014 CapEx, our expectations are around $10 million for the full year. We’re looking at between $6 million and $7 million for the final build-out of Shoals which basically takes us through mid-year. And then couple of million dollars in maintenance, capital and some of the product developments pending. So, those numbers are exclusive of any decisions we make in terms of build on the lease fleet. So those are just the sort of the internal – the internal ones per say. Justin Long – Stephens, Inc.: Okay, perfect.

And then in terms of the balance sheet we obviously have forecasts and so on with large deposit taken at year end, that will be used as you would expect to purchase inventory for that – that order. And we expect that to come down over the years. So, I mean, as we project out, I guess those are long-term as we’d like to be right in the $100 million range and again there will be a large consumption as we from the $192, as we buy in the inventory for the order. Justin Long – Stephens, Inc.: Okay, great. So, excluding that customer deposit at cash balance, it doesn’t sound like it should change much?

Don’t think so, because well you go to remember just a lot of depends on where you end up with your backlog and your plant production going into the next year and how much inventory you have to have on the ground and – and then pay for. So, that’s a long – long lookout at this point just with the caveat that can change a lot at any point in time. Justin Long – Stephens, Inc.: Right, that’s understandable. And may be one last one. I was wondering if you’ve seen any significant orders subsequent to quarter end, listened of Norfolk Southern’s capital budget plans in their commentary for 2013. It sounds like they could be in the market for some new coal cars so I’m just wondering is that an opportunity at some point or if that could be reflected in the current – that’s reflected in the current backlog?

Now, there is a number of opportunities I think that Ted talked about there is a lot of enquiries out there for a lot of different car types. At this point there is nothing subsequent to year end that we’re ready to discuss. Justin Long – Stephens, Inc.: Okay, great. I’ll leave it at that. I appreciate the time this morning.

Thanks, Justin. Thanks.

And next with the line of Matt Brooklier from Longbow Research. Please go ahead.

Yes, thanks. Good morning. How should we think about Shoals startup costs moving out or, are we kind of all the way there in terms of getting the facility staffed up and ready to start cranking out railcars in 2014 or, is there still more cost than more work to kind of get up the curve and in terms of being fully add your all-in manufacturing capabilities?

So, it’s Chuck. The – spending we’re really looking at CapEx just south of $7 million between – basically between now and in mid-year. So, in terms of the ramp-up both in terms of equipment and the lines in terms of staffing it’s on a pretty steep slope here in terms of being complete by mid-year. So, as you look at the – the startup costs that I mentioned sort of the – labor efficiencies as we bring new people on. We really expect to add to sort of pay per down to mid-year and basically go away at mid-year. But again what in that point in time it’s going to be surely subject to volume and orders and in the books. So, as we projected out that’s kind of looking at as fully – fully operational and staffed by mid-year.

Okay, so – it’s I guess a follow-up on that. Where are we from the staffing perspective and then it sounds like we’re going to see some startup costs in the first half of 2014, but may be not to the same degree that we saw in the second half of 2013, is that a fair way of thinking about it?

Yes, so I’ll take the first half on the costs we do expect a tapering of those and also a reduction in Danville as well because of the write-down.

Okay.

We haven’t split those two pieces out we’ve kept them together, but again we do see those decreasing and with the impairment at Danville.

Yeah, in terms of the staffing side, now we continue to ramp-up now we had – we were fully staffed at one production line at the end of the year, and continue to start preparing the ramp-up second production line well that’s still on process and we’re still bringing people in today and given them train – hired and trained. So, we’re going to see those costs continue here. But, as we get fully staffed up here this spring that will then the training costs will just taper off.

Okay, and with two lines going and being fully staffed up, where you guys are kind of add max capacity at Shoals?

Well, we’ll be at max capacity for the staffing levels again we’ve taken a pretty cautious view on production to make sure that we don’t overstretch ourselves and we produce good quality products for these new car types.

Okay, but – I guess my question being as, if the demand is there you’re ready to, you’re able to take all of those orders and produce something close to the maximum of what that facility potentially can do it from a delivery perspective?

A lot of that’s going to depend on the customer fair design, how quickly everybody gets at full coal production and capacity in terms of they’re still down there. I think we’ll stick with for this year what the guidance I gave on the number of cars we think are going to get [ph] dealt and delivered.

Okay, it’s very helpful. Thank you.

Yes.

Our next question is from Sal Vitale with Sterne, Agee & Leach. Please go ahead. Sal Vitale – Sterne, Agee & Leach: Hi, good morning all.

Good morning, Sal. Sal Vitale – Sterne, Agee & Leach: So, just first of all just a clarification on what was said earlier in the call on maintenance that. Did you mention how many of the 700 non-coal car orders received in 4Q where for covered hoppers?

We did not. Sal Vitale – Sterne, Agee & Leach: Okay.

We don’t break out that level of detail, Sal. Sal Vitale – Sterne, Agee & Leach: Is that a significant number or is that just not a level at this point?

It was a good position of the 700. Sal Vitale – Sterne, Agee & Leach: Okay. And, is it fair to say that the margins on the covered hoppers as general higher than the coal cars?

That – than coal cars, our margin is that as we talked about this year are going to be a lot of function of our startup downward Sal. Long-term we think as we said before for our new car types the margins to be comparable to coal over the long-term. But this year as I mentioned that we are going to have the drag at just the startup and pull our margins down. Sal Vitale – Sterne, Agee & Leach: Right, but the actual contribution margin for the individual car you were saying is about similar to that the coal?

We expect that over the long-term yes, when we are fully operational and have the number of these produced in our back pocket. Sal Vitale – Sterne, Agee & Leach: Okay. And then the – just looking at the breakdown of the $5.3 million in costs that was identified, I think you said $3.6 million was, was that purely of Shoals startup costs I may have missed that?

Yes, now that was a combinations but we haven’t broken out and we’re not breaking out the Danville call it, the Danville is idle currently, the Danville carrying cost as well as the Shoals startup cost. We haven’t broken those out, but of the $5.3 I think it was $3.6 in total for those two items. And the Shoals’ items the larger of that two and as I said, the Danville one drops pretty diametrically with the asset write-down, the impairment that you’re at. Sal Vitale – Sterne, Agee & Leach: Right. And then – so that remaining $1.7 million what was that again?

So, that’s the one Joe had discussed in terms of the lead-times on the material. So the $1.7 was fundamentally, it’s 2014 production. But in terms of the lead-time requirements we have to go – we had to buy materials at prices that were substantially higher than sort of a normal lead-times. And so fundamentally we booked the charge in 2013 for that difference. Sal Vitale – Sterne, Agee & Leach: Okay. And then, just to drill down a little bit on that particular order. So – are the contractual terms of that particular order are they any different than the rest of your contractual terms, I guess what I’m getting at is, is this something that could reoccur in the future?

Sal I think I’ve said before, this was a unique situation driven by a customer demand there is nothing unique I would say in the contract that we’d expect to see this again. Sal Vitale – Sterne, Agee & Leach: Okay, that’s fair. And then, just the last thing is looking at your guidance so, if I look at the other backlog of 6,800 cars I assume that’s all are slated for 2014 delivery at this point?

Sal, yes, the majority of it is. Sal Vitale – Sterne, Agee & Leach: The majority of it is, okay. So then Joe, earlier you mentioned that in your conservations at the Eastern Railroads that there is still intention to replace the ageing coal car fleet on the re-bodied side or on the rebuild side rather. So, I guess if we look you’ve received an order for 4,000 cars on 3Q, would do you expect to receive some more significant size orders in throughout the various quarters of 2014?

Yes Sal, this is Ted. We’re not going to comment on future specific orders, but what we will say is that we continue to believe in the eastern replacement story that is going to continue. And we’re just limited [ph] at that. Sal Vitale – Sterne, Agee & Leach: Okay. And then just if I look beyond 2014…

Hey, John I think there is some background on the call.

When you put to one-on-one.

Sal, you still there? Sal Vitale – Sterne, Agee & Leach: Question I apologize. So if I look, I see your guidance for 2014 and I understand you don’t provide any guidance at this point for 2015, but assuming that your order flow for in your Shoals facility for your non-coal car types continue to accelerate, is it reasonable to assume that you’re willing to have more than 7,000 deliveries in 2015?

Sal, we’re not going to comment on that, that visibility that far out is tough as you know especially on the coal car side our orders come in big lump and as we talked in the past, as we can go a year without a big order and then get a year like that we did last year with multiple big orders. So, that visibility past right now in the 2015 is unknown. Sal Vitale – Sterne, Agee & Leach: Okay, fair enough. Thanks.

Thank you.

And next we have from Doug Dyer with Heartland Funds. Please go ahead. Doug Dyer – Heartland Funds: Good morning, everyone.

Good morning, Doug. Doug Dyer – Heartland Funds: Could you please have a brief discussion as to where you think that maybe capacity to deliver cars on a quick turn, who would have that capacity now if anyone does?

You mean in the industry overall? Doug Dyer – Heartland Funds: Yes.

Again, without knowing the order books though, one of my competitors I know I think outside, their backlogs are well out. I think we heard and take their comment anecdotally some of the covered hoppers is out a bit, but there is capacity this year. We – as we talked about we have capacity in our Danville facility for certain car types of course. So, there is some capacity out there. But again quick as a relative term as lead-times are three to six months depending on the car type for materials. Doug Dyer – Heartland Funds: Okay. It seems likely the train system and the network has become a little bit congested lightly, obviously some of that’s whether, do you think there is a little bit more of work to net is, are you kind of running at a high capacity rate on the rails or is it everything from what you can see just weather-related as of now?

Doug I think it’s, if you listen to the Class 1s they’re going to tell you that they see a pickup in economic activity and they’re also tell you that, that this first six weeks of this year has been tough from a network operation standpoint. So, it’s a little bit of both, but I think they tend to be more optimistic for 2014 then maybe they have been in the past. So that’s – we look at that as a positive event obviously. Doug Dyer – Heartland Funds: Sure, okay. You addressed your cash, you were saying that without that customer deposit, you think that your number will kind of be fairly stable throughout the year. It seems to me like there would be some cash available to do some share buybacks. I think that would be an opportune time to do so if it looks like we’re going into a business I’m sorry, a mode of business here where things are improving and it looks like improving rather well if you listen to the Class 1s?

Doug, we understand that and understand your honest decision on that. I think, where we’re at, we’re still in our strategic initiatives, now we’re still need to finish out the Shoals, we still need to invest in new product development and still need to invest in growing the value of our services business. So we discussed this at the Board meetings on a regular basis, but right now again we’ll maintain a considerable position on our cash. Doug Dyer – Heartland Funds: Okay. All right, one last one. your leased fleet, what is that consist of, is that all coal cars?

The vast majority of it is coal cars. Doug Dyer – Heartland Funds: Is there more interest in that as we’ve got cars coming out of storage?

I would say that the cars coming out of storage is a recent phenomenon and we’re tracking it. Obviously that’s good news as well, we’re hoping that it’s sustainable and not just a function of the cold winter much of the U.S. is seeing. So, certainly a positive turn of events that will, if that continues it will help renewal rates and term getting the lease terms extended outward. Doug Dyer – Heartland Funds: Do you have many of those coming up for renewal this year?

I would say no more than normal. There – there is usually the average 15% to 20% renewals that take place on a year-over-year basis. Doug Dyer – Heartland Funds: All right. Thank you very much.

(Operator Instructions) And we will go to Michael Baudendistel with Stifel. Please go ahead. Michael James Baudendistel – Stifel, Nicolaus & Company: Thanks. With the closure of one of the repair shops, is there more to do there with additional shops that you would close?

No, now I think our strategy is going to remain in at the same in growing that. The facility we closed has been a different geographic, it didn’t have the dynamics, of being on a high volume quarter like our shops out in the Nebraska are. So it is just a different decision, I think, there are other shops so we still like to still see an opportunity to grow our value from those. Michael James Baudendistel – Stifel, Nicolaus & Company: Yes, it’s good detail. And then the covered hopper orders and the covered hoppers a lot of different sizes moving the large different types of the freight, which markets are being targeted there?

If you look at where the lion share of covered hoppers ran in the other and the small capacity for cement and sand and medium capacity for grain and larger in some plastics where I think Ted commented on the enquiries we’re seeing enquiries kind of for all three of those as you get now out in the future. Michael James Baudendistel – Stifel, Nicolaus & Company: Okay. And then, I just want to make sure interpreting some of your earlier comments correctly with the 7,000 units delivered in 2014, already you have 1,600 in backlog. So, I guess to one of the earlier questions, the reason you’re not expecting more orders that come in, in 2014 that you can deliver in 2014 as because most of those orders would be outside of coal in Shoals. Shoals is already a full capacity which is somewhere in the neighborhood of 3,500 because as half of the 7,000 you expect to be delivered, are all those things sort of roughly correct?

Yes, I think definitely roughly correct and when we look at the coal market that’s where Danville would be the type of cars that would go in there, and the visibility there just isn’t there and Shoals were being cautious on what we can expect there given we’re in startup mode still. Michael James Baudendistel – Stifel, Nicolaus & Company: Okay, great. That’s all I have this morning. Thank you.

Thanks Mike.

And we have no additional questions in queue.

Right. This concludes today’s conference call. Thank you for joining. A replay of this call will be available beginning at 1 PM Eastern, today at 1800-475-6701, pass code 318803. Thanks.