Good morning, and welcome to the Wabtec’s Fourth Quarter 2014 Earnings Release Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Tim Wesley, VP of Investor Relations. Please go ahead.

Thank you. Good morning, everybody. Welcome to our 2014 fourth quarter and year-end earnings call. Here with me are Al Neupaver, our Executive Chairman, our President and CEO; Ray Betler, Pat Dugan, our CFO; and John Mastalerz, our Corporate Controller. We’ll make our prepared remarks as usual and then we will be happy to take your questions. During the call, of course, we’ll make forward-looking statements. So we ask that you to please review today’s press release for the appropriate disclaimers. With that, I’ll turn it over to Al?

Thanks, Tim. Good morning everyone. We had an excellent operating performance in the fourth quarter with record sales, earnings and cash flow from operations. As a result of this strong finish to the year, we also posted full year records for those metrics, and we ended the year with a record backlog of about $2.3 billion. In particular, our cash generation was excellent in 2014 with cash flow from operations at $472 million for the year exceeding that income by a $120 million. We also continued a very important streak. Wabtec finished 2014 is the only company in North America and any exchange who is here in stock price has increased to 14 consecutive years. The business is performing well, thanks to our diversified business model, our strategic growth initiatives, our dedicated employees, and the power of our Wabtec performance system. We are optimistic and excited about the long-term growth opportunities in our freight and transit rail markets, which are being driven by compelling trends around the world. Today, we also issued our 2015 guidance. We expect full year earnings per diluted share to be about $4.5 with sales growth of about 10% for the year. This was driven by prior acquisitions and internal growth. Our EPS guidance is about 12% higher than our 2014 results. Our guidance assumes the following; modest growth in the global economy taking into account current conditions in all of our key markets. Top-line growth in both segments with freight growing a little faster than transit, our freight growth will come with about 50% of it from organic initiatives, while in transit about two-thirds of its growth will come from prior acquisitions. Our guidance also assumes continued operating margin expansion and it assumes no changes in foreign exchange rates from the current level. The impact on 2015 guidance from foreign exchange rates is about $100 million in revenue and that has an impact of about $0.10 on EPS. Our tax rate of about 31.5% for the year. We assume no major disruptions from the labor situation at the West Coast ports and it does include the acquisition of railroad controls which we just completed two weeks ago. As always, we will be disciplined when it comes to controlling costs. We’re going to stay tremendously focused on generating cash to invest in growth opportunities and ready to respond if market conditions change. With that, I’d like to turn it over to our President and CEO, Ray Betler. Ray?

Good morning everyone. It’s pleasure to talk to about our 2014 results and why we are optimistic about Wabtec’s future. The optimism starts with our key markets, which remain compelling as these markets mainly freight, rail and passenger transit, are large, global and growing. According to the UNIFE study, the worldwide global addressable rail market exceeds $100 billion with annual growth of about 3%. One common theme around the world is that customers are focused on improving safety, productivity and efficiency and Wabtec plays an important role in all of these. The markets are also compelling because an efficient transit system and robust infrastructure are essential to global economic growth in both developed and emerging countries. Also driving global investment are secular trend such as urbanization, energy evolution and increase environmental awareness. In NAFTA, freight rail traffic was up 4.4% in 2014 that was led by a 5.4% increase in intermodal. And so far this year traffic is up 4.5%. So it still remains strong. In fact, all but one traffic category is up this year including crude by rail. As a result, OEM rolling stock deliveries in 2015 should be strong and above the long-term average. We expect about 1,300 locomotives to be delivered this year, compared to about 1,450 last year. And the freight car market our strategies to be strong with deliveries up about 70,000, 60,000 in 2014 and a backlog of more than 140,000 and our plans in 2015 assume 75,000. Globally, freight traffic is somewhat mixed, depending on the geographical market. With increases in countries such as India and Germany decreases in countries and regions like UK and Russia. As you know we are focused on increasing our global footprint and product offerings, where we see opportunities in markets that a larger than our traditional…

Thank you, Ray and good morning to everyone. Our sales for the fourth quarter were a record $821 million, which is 20% higher than a year ago quarter. Of this increase, little more than half was from acquisitions. As a reminder, we expect over the long-term about half of our growth will come from organic initiatives and half from acquisitions. Freight segment sales increased 24% or about $92 million. Only $19 million of that growth was from acquisitions. The majority of growth in the freight segment was organic. Transit segment sales increased 16% or $48 million. Acquisitions added $64 million to the trade segment sales which means that we were down a little bit organically, that decrease was due to the completion of certain locomotive projects which contributed significant revenues in 2013. Adjusting for these projects, organic revenue in the segment would have been up about 8%. Changes in foreign exchange rates, reduced sales by about $17 million in the quarter compared to the prior year quarter mostly in the transit segment. Operating income for the quarter was a record $137 million or 16.7% of sales compared to 16.3% in the year ago quarter. As expected, that operating margin was slightly lower than in certain prior quarters mainly due to the Fandstan acquisition, which occurred earlier in 2014. We have said that Fandstan will contribute significant revenues in the second half of 2014, but minimal earnings due to expenses from purchase price accounting and integration. In addition, its historical margins are lower than our transit segment margins. Now that we’ve had Fandstan in the fold for a few months, we’re confident that we can increase margins overtime and we expect our operating margins to improve over the long-term as well. That said it’s worth nothing that for our full year…

Thanks, Pat. Once again, we had a good performance in the fourth quarter and for the full year. Taking one final look back at 2014, revenues increased 19% to a record $3 billion. Income from operations increased 21% to a record $527 million. EPS increased 20% to a record $3.62 and our backlog ended the year at a record $2.3 billion. Looking ahead to 2015, we’re anticipating another record year with EPS guidance of about $4.05 on revenue growth of about 10%. We are very pleased with our strategic progress and long-term growth opportunities we see. Countries around the world continue to invest in freight rail and passenger transit infrastructure. We continue to benefit from our diverse business model and our Wabtec performance system which provides the tools we need to generate cash and reduced costs. We have an experienced management team and a dedicated group of employees that are poised to take advantage of our growth opportunities and ready to respond to any changes in market conditions. With that, we’ll be more than happy to answer your questions.

Thank you. We will now begin the question-and-answer session. [Operator Instructions] The first question comes from Justin Long with Stephens. Please go ahead.

Thanks, good morning guys and congrats on a quarter.

Thanks, Justin.

You alluded to this in the prepared remarks, but there’s been some press recently about ECP potentially getting included in the final tank car regulations. I wanted to ask couple of questions on that topic. First, in your experience with ECP brakes, have you found statistical support that it reduces the chances of a derailment?

Obviously, we’ve been working with electronic controlled pneumatic breaking for a long while and some of the original interests related to it dates well back into the early 2000. So thus far globally, those installations well over 40,000 cars that had ECP breaking on it. Most of those cars are in Australia, some in the Middle East and South Africa. So, it is a technology that has been adopted around the world. There have been pilot trains that have been run here in the states since 2006. I think it was in 2008 when we outfitted a few trains here in the U.S. The thing that ECP does is it does provide shorter stopping distances. Those stopping distances can be reduced anywhere from 40 to 60 or even a little higher depending on the size of the train. ECP allows for what is called graduated release. That means right now, I’m just a pneumatic brake you either have brakes that are fully applied and fully released. What it does is it lessens the in train forces because you are able to gradually put the brakes on and release them. They also allow for what would be faster recovery time for the air system. It uses less air therefore the air pressure is not depleted during the break application. That eliminates the potential of not having enough air to apply to brakes. Having electricity or power throughout the train creates an opportunity for adding sensors and diagnostic guide tools. It can be tied into the train control system. The train is equipped with positive train control. So I think that answer your question has statistically been proven, I think that these advantages have improved in and these advantages are being seen and proven primarily along the world so answer your question…

Thanks out. Yeah, that did. Thank you, that’s all very helpful color and as a follow-up to that question, we are of course trying to estimate the cost that ECP could present for the industry. I guess we can look at the cars inflammable service and it’s a little bit easier to run the math on the cost to add ECP there. I wanted to ask about the locomotive. Obviously you have to upset some of these locomotives, but do you think this is a situation where the rails what update all locomotives and service the 20,000 units or so, where do you think they will focus more on a subset of the population that’s dedicated to moving inflammable commodities, if we did see this regulation get past?

First of all, I think we are realized that there was administration group that was set up the pipeline add this materials and safety administration and this group was tasked with making recommendation as far as the proposed rulemaking for safer transport of crude oil. We have at this point there is no verification, that this particular technology will be approved or not approved. I wanted to make sure that you understand that. When you look at – if it was part of this rulemaking which I believe is right now being reviewed by the White House office of information and regulatory affairs, if it was part of the regulation ECP, the actual unit on the cars, the cost of those ranges anywhere from 4,000 to 6,000, it depends because the technology that is offered is in two forms. One is what we call standalone ECP unit. That would actually require every car on the train to have that unit and that way you would also need the locomotive and that’s part of your question and I’ll get to that. But we also offer alternative. So that there is a unit which we call on overlay that could be used that could be switch back and forth to an ECP train or a regular pneumatic train. So that’s the reason for some type of range of cost and it could be anywhere from $4,000 to $6,000 depending on which way you choose that there is also wiring required and installation, cost associate with that. If the locomotive in order for the train to operate with ECP, the locomotive also has to be fitted with electronic brakes and have been adapted to also accept and transmit the signals for ECP. The estimate of cost on the locomotive could be dependent on whether you are putting a new electronic braking on or just adapting it. That price could be anywhere from 30,000 to 50,000, I think when you look at a train I don’t know the number of locomotives in general that I think there is at least three locomotives on a train that might be 100 cars or so. So you could usual calculations from that information I believe.

Okay. That’s great detail Al and I will sneak one more in and pass it along. But you gave the updated backlog numbers. I was curious how much of the backlog right now is PTC related and is this possible could you comment on the level of PTC related backlog that’s allocated for this year versus future years.

Okay. We have about $100 million of backlog and the PTC related products. I also want to go back to ECP just for a second and I’m not sure – that we have none of the ECP regulation requirements in our guidance for ECP, multiyear. But as far as PTC, the backlog is about $100 million.

Okay, perfect, I’ll leave it at that. Thanks so much for the time.

Okay, thank you.

The next question comes from Scott Group with Wolfe Research. Please go ahead.

Thanks, good morning guys.

Good morning.

Just a couple of quick follow-ups on ECP. Are we correct that you guys have – you guys would have the technology for both the car and the locomotive and I think both in the U.S. and Canada? And then if you could just clarify there is anyone else in the market that has this technology currently?

Yeah, Scott. We have both the technology for the locomotive and the car and our major competitor in breaking is nor air break and they have the technology as well.

Okay, perfect. In terms of PTC, what are you guys expecting in terms of any aftermarket this year and when is a realistic timeframe for when the aftermarket kicks in I don’t know if we’ve talked about this before? Is it – once it’s fully installed or some of the aftermarket start sooner?

Yeah, Scott, this is Ray. So aftermarket really doesn’t affect the warranty period is finished. So, warranty is normally a year on these contracts and that warranty period, as far as – it goes into effect once the products in service. So, the aftermarket is going to be developed overtime as we’re not going to see a lot of aftermarket revenue this year where obviously focused on developing those agreements and the opportunity in MRS is maybe the best example of where revenue will be realized in the near medium term because that contract is almost complete the project, that will be finished up this year and the vehicles are in service. They had been in service. They are being phased and the entire project will be closed out, so we’ll transition over into a service agreement. So we look for annual release of about anywhere from 5% to 10% depending on the volume in the particular customer technology and we think we’ll start to realize those after the warranty period is finished, which obviously is going to be in future years and not this year.

Okay, that’s really helpful and just last question, so the guidance for 10% revenue and like 12% earnings, it doesn’t imply much for margin expansion, if you’re buying back some stock, but I think Al, you mentioned that you do expect margin expansion this year so maybe just help us think about.

You answer that question consistently. We strive for continuous improvement and one of the areas that we will continue to focus on, Ray and his team have done a tremendous job in ’14 and in ’15 we expect that margin to expand again.

Okay, alright, thank you guys.

The next question comes from Matt Brooklier with Longbow Research. Please go ahead.

Hey, thanks, good morning. So I had a follow-up PTC question that the 10% growth you’re expecting for ’15, can you talk to how much of that is going to come from freight and how much of that growth is going to come from transit PTC?

That’s it’s really – if you look at you probably that’s fine, based on historical – it’s about 50% is trade and the other 50 is split between almost equally between transit and international. So we anticipate that will pretty much typify this year’s revenues.

Okay, that’s helpful. And then you talked oil and gas your exposure I think about 5% of the revenue. Can you remind us of broadly what products that you have that our impacted from by the oil and gas industry and then what’s in your guidance, if you are assuming that contribution from those products revenue EBIT perspective that’s expected to be I guess down this year, is it flat. Maybe be just give a little bit more color on that.

So in terms of – I’ll address the product area. In terms of products it’s basically calling system, heat exchanger systems that are used in drill hedge and drilling wells and for the power systems, the power of those products. And some of the products so with some other products that are used in oil and gas well that we talked about, is that product line we acquired when we acquired onward that, so those are the products.

On the guidance, we have included basically what we do the current market conditions are into our guidance. So that has been put into the guidance that you received the impact from the energy business that we have.

Okay. And then could you just – can you touch upon how much then stand earnings contribution, is also anticipated in the ‘15 guide. We know it was the big part of the revenue contribution in ‘14. But we didn’t contribute much for the bottom-line. I’m just trying to get a feel for how much Fandstan incremental earnings you guys are making into the ‘15 guide.

Fandstan there is two negative factors that basically behind us and that’s the amortization related to inventory and our backlog so those behind so we will see that improvement. But you will also see is that the synergies of the acquisition and the profit improvement program is built into the guidance. We really that want to break up this specific numbers at this point, but I think that really make some comments the way – that we think this acquisition has gone as we plan and expected to about eventually get to margins that there about the average for the transit group.

Okay. I appreciate the time.

Thank you.

Next question comes from Thom Albrecht with BB&T Capital Markets. Please go ahead.

Hi guys, good morning. Congratulations on another nice year and another nice quarter. I wanted to square way couple of things for my model. So maybe these first couple of questions are for Pat that in the last quarter your SG&A guidance was $85 million to $86 million and came in at $93 million. I’m just wondering why there was such a big variance.

We had number of discrete items came through. We had some engineering costs and we had some other – I’m just some cleanup and some of the corporate items, including incentive and other benefits that really our acquisition related. So I think in the end what’s really driving that is our run rate is going forward. We’re really thinking it’s going to be somewhere around $89 million to $90 million in a quarter.

Okay, could you say incentive comp came into play to or is that incentive tied to burnouts?

Yeah, so when do you have number of incentive programs and so we added with Fandstan and with the performance we had drove up and we had more people in the plans and so some there was some additional money that we set aside [indiscernible].

And then you did allude to be amortization but that still about 2 million bucks that’s higher than what you guys commented on is the $18.3 million kind of the run rate going forward or would that also be a little bit lower?

I expect that the time to come back a little bit because you have PPA and other items that are frontend loaded in any of these acquisitions, but of course we’ve added RCL and we’ll continue to have an active acquisition program, so we tend to bounce around a little bit there on the amortization and the depreciation lines.

Okay. And then on the other income/expense, it was a $7 million actual expense, a lot of time sets relatively a small deal, but it was about a $2.6 million swing year-over-year adversely. What was in that figure?

It’s mostly translational losses. And with a big move in currency, we do a pretty good job of balancing that exposure, but we did have because of such a dramatic move in certain exchange rates we did have a negative impact and we expect that to moderate. Short of course more volatility in the FX markets, but I think we’re – that’s an unusual.

Yeah, if you look at the year ’13 and ’14, you know ’13 had a net plus minus of negative 882, ’14 was 1680 and I think as Pat pointed out, I think the FX changes, drilled mostly that change and those are the things that really hung up on the balance sheet in a company issues that can’t be wash through in a given period.

Okay, I appreciate that color. And then when I back out the revenues from acquisitions which you gave for the quarter, I’m showing organic growth of 8.3% is that correct or do I need to make some sort of adjustments for the fourth quarter of ’13? I took out the $19 million and then $64 million just from this year’s fourth quarter, but did make any adjustment to Q4 of ‘13.

That’s it. That’s the right number, 19 and 64 total. And that’s the 57% of a total change.

Okay, good. Thank you. And my last question would be when I look at your revenue guidance for the year and we never know exactly how acquisitions are performing, but when we factor in the 10% growth target for PTC plus what we think, you got with acquisitions and we try to pro rate of that based upon the month you acquired it. We’re showing – you’ve already got about 7% or the 10% revenue target, so are you expecting organic growth to slow, I mean, it seems like it really had a nice solid phase throughout ’14.

Yeah, I think that you have to play in the impact of FX. You put that in and we’ve talked about in our guidance the impact of the price of oil. In a long-term, we still feel strongly that we get half of our growth internally and half from acquisitions.

So that $100 million revenue impact from FX and that would have been versus zero in ’14, what was your revenue impact from a full year for FX?

In ’14, it was actually positive by about, I think $11 million, so it was in the quarter-to-quarter was down $17 million. Keep in mind if you look at that FX, that’s 3% growth.

I’m just trying to think of it the right way.

It’s fine. I think it’s good to point that out.

Okay, that’s all I had guys. Thank you for the clarification.

Okay, thanks Thom.

The next question comes from Jason Rodgers with Great Lakes Review. Please go ahead.

Hello, just getting back to the PTC guidance, a 10%, I’m wondering if you could talk a little bit about your assumptions in that growth figure and what factor what could potentially just upside there.

I mean the assumptions are that people at the platforms are going to continue to pursue aggressively the installation and commissioning or you probably are aware the status and industry of the stuff is probably ahead of the other class ones that all the class ones are working earnestly to try to get their systems installed and commission as close as possible to 2015 deadline day. We also had assumptions in there that will finish MRS this year. We had assumptions in there that will continue support and when transit opportunities we are assuming that probably about third of those transit opportunities will generate revenue this year and reason it’s only a third is that some of those transit authorities still haven’t received funding to support their PTC specification writing that process and ultimately implementation.

It’s very difficult thing to project. A lot of it depends on the progress made and again the funding on the transit authorities still up in the air and more depend heavily on those new transportation bill.

Okay, could you talk a little bit about the tier for locomotives and the demand trends there?

[Indiscernible] locomotive current status is GE has an improved set for locomotive. A lot of class ones have done this – back forward for their going through rehab processes rehabilitation process existing locomotives. GE’s forecast is pretty substantial for this year, and obviously [indiscernible] it’s going to be tough it and they intends to be industry this year GE has been about two years qualifying and we participated within on it.

And then finally, looking at the percentage of new products over the past five years, do you have an updated figure just going through the end of 2014.

About 38%.

Thanks a lot.

Thank you.

The next question comes from Mike Baudendistel.

Thank you. [Indiscernible] using your balance sheet acquisition. Do anticipate having to borrow it all going forward. You’ve been completing with cash on the balance sheet?

We really drive the position and we are in. We got extremely strong balance sheet, I think even through our priorities that we wanted to do that balance sheet and we will continue to apply for those priorities. So I think the beauty of it is that the opportunity came about we have room to acquired large companies continue to do the build on and I think that it’s a great position to be in especially compared to other companies don’t do a lot of acquisitions. They may not have that luxury that we do that.

Could you give us a sense for how much your cash is held overseas? How many future acquisitions could potentially…

[Indiscernible] year on the total cash of 425…

I would say roughly 60%, 65% total cash we had on hand was and that foreign jurisdictions and we had some cash here in U.S. that we used right after yearend and closing and buying RCL.

Okay, great. Those are all my questions. Thank you.

Thanks and I appreciate.

The next question comes from Samuel Eisner with Goldman Sachs. Please go ahead.

Yeah, thanks, good morning everyone. Just on the RCLs transaction it’s about $75 million in LTM revenue. Do you have any kind of indication with the margin profile is about business and you also let us know what percentage of the revenue are between the segment it seems as though it.

Well the margin is very similar to what’s the overall margins and freight margins and we enjoyed overall despite the PTC release. Despite, the type of work, is that the question you are asking?

Of the $75 million – I guess of the $75 million of revenues, how much is…

So the majority of the sales are on freight side, yeah, almost all of the sales are in freight side.

Got it, and then, so perhaps moving to the incrementals implied in your guidance, I think if you kind of back into them, the round 20% contribution margins that you guys have got into, and you know this past year, you did around 19% with a lot of moving pieces in SG&A while integrating the Fandstan transaction. So I just want to understand you know is there anything else that were missing in the implied kind of contribution margins for next year. It just seems as though you have somewhat easing comps throughout the year, the course of the year, so just help me understand that please.

Well I said that we really to begin the year that has the uncertainty that this year has related to oil pricing, foreign exchange rates, just you know the amount of internal growth that we could count on, I think our number is probably what we have normally got at this point, and it is conservative, we will obviously be looking for opportunities to improve on that contribution as we go forward.

Great, and then you mentioned that FX is I guess as of today, can you just let us know what rates you are using for the Euro and the pound going forward throughout the course of the year that’s implied in your guidance.

Okay, yeah I would just look at today’s spot rate and use that as a benchmark for how we quantified the impact of FX, of course, when you get into the accounting, use the weighted average rate, so it ends up being a little bit tough to take a jump off point and do some comparisons, but I think if you look at today’s rates for the euros and pounds, those are our big exposures, and that’s what we based on now in the call.

Great, and then just lastly, obviously with a lot of cash on hand, Al you were commenting before about acquisitions but can you talk about the five of the acquisitions within your funnel, have they – now that you have effectively more cash on hand, does that mean that you are looking at large transactions, or are you still kind of looking at these you know $100 million sweet spot type transactions.

We continue to be opportunistic, in the end we have the ability to do a large acquisition, but as in the past if you look at the 30 plus acquisitions we had most of them were more in the $50 million to $100 million range and that’s what we mostly see. There is a lot less that of those larger acquisitions thereafter.

Great, I will hop back in queue, thanks.

Thanks.

The next question comes from Liam Burke with Wunderlich Securities. Please go ahead.

Thank you. Outside of PTC and ECP you highlighted on your product development, are there any products that you see in the near term that will help fuel growth?

Yeah, basically in Q4 we just talked about that there are global are certainly more, we have a lot of products in across [indiscernible] and we will talk a lot about the friction products, if it comes to market we just qualify to replace the shoes with the composite shoes. We have oil free compressors that will be qualified in and sold in, both transit and freight markets. So if you go across our business there is products in every business unit, it’s a major strategic focus of ours, and we invest in every business unit and product development.

Okay, thanks. And then on markets, do you see any particular market this year that provides near term opportunity and conversely do you see any challenges out there.

We face challenges every day, I guarantee that, well you could comment about the market.

There is opportunity, obviously we are watching very closely the freight kind of product moving, that can go either way, we are very hopeful that it is going to continue to go in a positive direction as the U.S. as the economy is going to hold up and that there is not going to be improvisations because oil prices or other issues, geopolitical issues or whatever else might affect us. So freight market certainly is a good opportunity for us, where longer term, we start to invest in international markets like in more substantial way in like India where we have entered into a joint venture with Texmaco, one of the largest freight car builder in India, so there is opportunities in Europe, the economy is sluggish maybe we certainly have great opportunities there because we are a small player in a big market. So all those are opportunities that we are excited about.

Great thank you.

The next question comes from [indiscernible] with Macquarie Capital. Please go ahead.

Good morning and thank you. My first question relates to the long term EPS growth trends, as you just pointed out earlier, on a constant currency basis, EPS growth support 15, it’s about 15%, so could you please comment how that may differ from the long term trend that you are seeing maybe highlighting puts and takes this year versus the long term outlook. Thank you.

Okay, I think you got to go back to really take a look at what our, what we establish as kind of our vision, our goal, and that is to have double digits per share earnings growth through the business cycle. And so if you go back to 2006 to today, that growth has been almost 19% over that period. We did better when there was enough tick in the economy and obviously in down turn we do worse, so as we look forward, we are just extremely excited about our future, and we have lot of opportunity, we are a small player in the global market, especially in Transit, we have new technology that is focused on the safety, efficiency and productivity of the rail road, so with that excitement as we look forward, we hope that we could continue our track record. However, we are also realistic, you are going to have challenges, ups and downs, not only from the economy but also the marketplace. So I think if we stay focused on these growth initiatives we have, that we will continue to have track record.

Thank you very much. And my second question, try to go to a little bit of detail on that, in the North American markets, and namely could you share with us what is your outlook freight car deliveries in the U.S. that you are counting on for your EPS growth target and help us then how that delivery outlook feeds into EPS growth.

The freight car assumption is 75,000 vehicles this year, that’s the assumption we have…

In the longer term, I am sorry, longer term, beyond this year.

We really don’t provide any long term growth rates, I think that if you look at the backlog you got 142,000 car backlog which bodes well for freight car builds, however that could be impacted by a lot of things. I think the backlog that is there, is sound and good, the point is how we will flow out, as anyone could estimate that, I think that you have to look at history when you look at rail car builds, and understand that it’s a cyclic business, it’s the reason why we diversified our business model, and right now, OEM car build, you know is less than 10% of our total business, at one point it was more or like 30% or 40%. So I think the backlog bodes well, but the economy is really going to drive the cyclicality of that business.

Very, very helpful, thank you. And my last question relates to Europe. I know that your growth is just ramping up after many years of efforts of getting established in the market and you just made a few comments to that. Can you give us a little more detail about the main initiatives or opportunities that you are excited about for this year, maybe the year after that?

Yeah we are pursuing with all major car builders in Europe opportunities that Continental Europe those car builders not only have products and systems that new cars that we are building for European markets but also internationally. So if you look at car builders like Alstom, Siemens, Bombardier, Alstom is a huge contract for instance in South Africa; Bombardier has a large contract over in India. We are talking to those car builders about opportunities inside and outside of Europe, and there is a good opportunities for us also in the UK, that’s in the overhaul market, also with the Roscoe’s, the main rolling stock companies that operate over there, and we are probably in a leading market share position there, it contains several major contracts in the UK.

Very much, I appreciate it.

Now we have a follow-up question from Scott Group. Please go ahead.

Hey guys, thanks for the follow-ups. So in terms of the Q4, has your content for loco changed with that and any difference between GE and then eventually Cadam on your content?

Yes, so there is a bit of a premium that we get for the Q4 but it may be reflected but it was made into the development that its they are in the same position with their local models. I don’t think that there is a difference between GE, their forecast in about two years 2017 before we [indiscernible]

Okay, and then just lastly on the PTC, what percent of the locos now have the computer system and what kind of delay are you assuming is going to be coming?

We think it’s about 50% overall which includes more complicated because some have complete case, some have provision case but overall on average it’s a little bit more than 50% installed as far as locos. Relative to the delays, we really can anticipate workload fall short, finding it through the deadline dates, you know the PTC system is a lot more accepted, just on board computer yet 45 equipment, that offers different CAD systems, yet the overall network, and so that will stock in, and so to be honest, we just do everything we can to support our customers, everything in the area [indiscernible] comments are in compliance with 2015.

That would have been the guidance for this year, what is that assumed you go from 50% of locomotives to what percent of locomotives?

I will probably can’t really give you the color right now, I would just assume that 10% growth is the right number and you could apply that to on board computer, basically, we have given you 50% of the freight is freight, 25% trans and 25% international, so.

Okay perfect. Thank you, guys, I appreciate it.

The next follow-up comes from Thom Albrecht. Please go ahead.

Yeah just a simple question, I guess for Al. On the 1300 locomotive forecast for 2015, is that all freight locomotives, and given cash position I am assuming, is that all GE or there is some switch in locomotives in that number.

It’s just mostly freight, Tom, we do some locomotives, but it’s mostly freight and it’s both GE and E&B because I think it’s international.

Okay alright that helps. Okay, thank you.

Thank you. Hello. Hey, any other questions? Hello?

The next question comes from Jason Rodgers.

Thanks, thanks for taking the follow-up, just looking for a few balance sheet numbers, total assets, equity, and then if you could repeat the accounts receivable number that would be great. Thank you.

Okay, so the total assets are $3.3 billion. I will give you the exact number, $3.308206 billion or shareholders’ equity is total is $1.808298 and sorry what was the last one.

You said it before but if you could repeat the accounts receivable.

Okay the total accounts receivable including unbilled is [indiscernible] okay anything else. Alright, great thank you.

Thank you.

With nobody else on the queue this concludes our question-and-answer session, and I’d like to turn the conference back over to Al Neupaver for closing remarks. Please go ahead, sir.

Okay, thanks a lot. Look forward to talk to you again in April. Thank you.