fstr-20250331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(Mark One)


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the quarterly period ended March 31, 2025


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the transition period from to

Commission File Number: 000-10436

L.B. Foster Company

(Exact name of registrant as specified in its charter)


Pennsylvania						25-1324733
(State of Incorporation)						(I. R. S. Employer Identification No.)


415 Holiday Drive, Suite 100, Pittsburgh, Pennsylvania						15220
(Address of principal executive offices)						(Zip Code)

(412) 928-3400

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01

FSTR

Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐

Accelerated filer ☒

Non-accelerated filer ☐

Smaller reporting company ☒

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April 30, 2025, there were 10,559,308 shares of the registrant’s common stock, par value $0.01 per share, outstanding.

L.B. FOSTER COMPANY AND SUBSIDIARIES

INDEX


			Page
PART I. Financial Information

Item 1. Financial Statements:

Condensed Consolidated Balance Sheets			3

Condensed Consolidated Statements of Operations			4

Condensed Consolidated Statements of Comprehensive (Loss) Income			5

Condensed Consolidated Statements of Cash Flows			6

Condensed Consolidated Statements of Stockholders’ Equity			7

Notes to Condensed Consolidated Financial Statements			8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			21

Item 3. Quantitative and Qualitative Disclosures about Market Risk			27

Item 4. Controls and Procedures			27

PART II. Other Information			28

Item 1. Legal Proceedings			28

Item 1A. Risk Factors			28

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			28

Item 3. Defaults Upon Senior Securities			28

Item 4. Mine Safety Disclosures			28

Item 5. Other Information			28

Item 6. Exhibits			29

Signature			30

Table of Contents

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)


	March 31, 2025		December 31, 2024
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	2,612	$	2,454
Accounts receivable - net (Note 5)	57,132		64,978
Contract assets - net (Note 3)	13,359		16,720
Inventories - net (Note 6)	81,780		70,506


Other current assets	9,433		6,947

Total current assets	164,316		161,605
Property, plant, and equipment - net	75,863		75,374
Operating lease right-of-use assets - net	23,482		18,480
Other assets:
Goodwill (Note 4)	32,358		31,907
Other intangibles - net (Note 4)	13,693		14,801

Deferred tax assets (Note 9)	29,630		28,900
Other assets	3,484		3,483

TOTAL ASSETS	$	342,826	$	334,550
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	37,257	$	50,083
Deferred revenue (Note 3)	10,126		10,205
Accrued payroll and employee benefits	5,313		15,393


Current maturities of long-term debt (Note 7)	151		167
Other accrued liabilities	11,018		12,448

Total current liabilities	63,865		88,296
Long-term debt (Note 7)	82,347		46,773
Deferred tax liabilities (Note 9)	1,112		1,150

Long-term operating lease liabilities	20,112		14,709
Other long-term liabilities	3,795		4,608

Stockholders’ equity:
Common stock, par value $0.01, authorized 20,000,000 shares; shares issued at March 31, 2025 and December 31, 2024, 11,115,779; shares outstanding at March 31, 2025 and December 31, 2024, 10,507,469 and 10,573,432, respectively	111		111
Paid-in capital	41,823		43,550
Retained earnings	165,469		167,579
Treasury stock - at cost, 608,310 and 542,347 common stock shares at March 31, 2025 and December 31, 2024, respectively	(14,736)		(11,208)
Accumulated other comprehensive loss	(21,879)		(21,716)
Total L.B. Foster Company stockholders’ equity	170,788		178,316
Noncontrolling interest	807		698
Total stockholders’ equity	171,595		179,014
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	342,826	$	334,550

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)


	Three Months Ended March 31,
	2025		2024


Sales of goods	$	86,548	$	104,463
Sales of services	11,244		19,857
Total net sales	97,792		124,320
Cost of goods sold	66,938		81,542
Cost of services sold	10,703		16,602
Total cost of sales	77,641		98,144
Gross profit	20,151		26,176
Selling and administrative expenses	20,952		22,870
(Gain) on sale of former joint venture facility	—		(3,477)
Amortization expense	1,122		1,217
Operating (loss) income	(1,923)		5,566

Interest expense - net	1,143		1,125


Other income - net	(318)		(253)

(Loss) income before income taxes	(2,748)		4,694
Income tax (benefit) expense	(631)		289
Net (loss) income	(2,117)		4,405
Net loss attributable to noncontrolling interest	(7)		(31)





Net (loss) income attributable to L.B. Foster Company	$	(2,110)	$	4,436




Per share data attributable to L.B. Foster shareholders:
Basic (loss) earnings per common share	$	(0.20)	$	0.41



Diluted (loss) earnings per common share	$	(0.20)	$	0.40

Basic weighted average shares outstanding	10,540		10,762
Diluted weighted average shares outstanding	10,540		10,985

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(Unaudited)

(In thousands)


	Three Months Ended March 31,
	2025		2024


Net (loss) income	$	(2,117)	$	4,405
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustment	103		(1,497)
Unrealized (loss) gain on cash flow hedges, net of tax expense of $0	(266)		106

Reclassification of pension liability adjustments to earnings, net of tax expense of $0 and $4, respectively*	—		25
Total comprehensive (loss) income	(2,280)		3,039
Less comprehensive loss attributable to noncontrolling interest:
Net loss attributable to noncontrolling interest	(7)		(31)
Foreign currency translation adjustment	116		(17)
Amounts attributable to noncontrolling interest	109		(48)
Comprehensive (loss) income attributable to L.B. Foster Company	$	(2,389)	$	3,087


*			Reclassifications out of “Accumulated other comprehensive loss” for pension obligations are charged to “Selling and administrative expenses” within the Condensed Consolidated Statements of Operations.

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)


	Three Months Ended March 31,
	2025		2024


CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income	$	(2,117)	$	4,405
Adjustments to reconcile net (loss) income to cash used in operating activities:
Deferred income taxes	(766)		(41)
Depreciation	2,305		2,374
Amortization	1,122		1,217

Equity in income of nonconsolidated investments	(54)		—
Gain on sales and disposals of property, plant, and equipment	—		(3,574)
Stock-based compensation	834		1,033


Change in operating assets and liabilities:
Accounts receivable	7,756		(4,042)
Contract assets	3,691		5,136
Inventories	(11,083)		(12,756)
Other current assets	(2,895)		(3,262)

Other noncurrent assets	(5,236)		675

Accounts payable	(12,649)		3,200
Deferred revenue	(129)		(1,008)
Accrued payroll and employee benefits	(10,129)		(11,599)

Other current liabilities	(2,613)		(1,807)
Other long-term liabilities	5,827		(1,395)
Net cash used in operating activities	(26,136)		(21,444)

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of property, plant, and equipment	—		3,501
Capital expenditures on property, plant, and equipment	(2,575)		(2,712)


Net cash (used in) provided by investing activities	(2,575)		789

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of debt	(71,314)		(55,835)
Proceeds from debt	106,205		78,746



Treasury stock acquisitions	(6,071)		(1,613)


Net cash provided by financing activities	28,820		21,298

Effect of exchange rate changes on cash and cash equivalents	49		(55)
Net increase in cash and cash equivalents	158		588
Cash and cash equivalents at beginning of period	2,454		2,560
Cash and cash equivalents at end of period	$	2,612	$	3,148
Supplemental disclosure of cash flow information:
Interest paid	$	1,010	$	992
Income taxes paid	$	341	$	303

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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L.B. FOSTER COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands)


	Three Months Ended March 31, 2025
	Common Stock		Paid-in Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		Noncontrolling Interest		Total Stockholders’ Equity
Balance, December 31, 2024	$	111	$	43,550	$	167,579	$	(11,208)	$	(21,716)	$	698	$	179,014

Net loss	—		—		(2,110)		—		—		(7)		(2,117)
Other comprehensive loss, net of tax:

Foreign currency translation adjustment	—		—		—		—		103		116		219
Unrealized derivative loss on cash flow hedges	—		—		—		—		(266)		—		(266)

Purchase of 168,911 common shares for treasury	—		—		—		(4,277)		—		—		(4,277)
Issuance of 95,952 common shares, net of shares withheld for taxes	—		(2,561)		—		749		—		—		(1,812)
Stock-based compensation	—		834		—		—		—		—		834


Balance, March 31, 2025	$	111	$	41,823	$	165,469	$	(14,736)	$	(21,879)	$	807	$	171,595


	Three Months Ended March 31, 2024
	Common Stock		Paid-in Capital		Retained Earnings		Treasury Stock		Accumulated Other Comprehensive Loss		Noncontrolling Interest		Total Stockholders’ Equity
Balance, December 31, 2023	$	111	$	43,111	$	124,633	$	(6,494)	$	(19,250)	$	724	$	142,835

Net income (loss)	—		—		4,436		—		—		(31)		4,405
Other comprehensive income, net of tax:
Pension liability adjustment	—		—		—		—		25		—		25
Foreign currency translation adjustment	—		—		—		—		(1,497)		(17)		(1,514)
Unrealized derivative gain on cash flow hedges	—		—		—		—		106		—		106


Purchase of 16,555 common shares for treasury	—		—		—		(385)		—		—		(385)
Issuance of 71,851 common shares, net of shares withheld for taxes	—		(2,278)		—		1,050		—		—		(1,228)
Stock-based compensation	—		1,033		—		—		—		—		1,033


Balance, March 31, 2024	$	111	$	41,866	$	129,069	$	(5,829)	$	(20,616)	$	676	$	145,277

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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L.B. FOSTER COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Dollars in thousands, except share data)

Note 1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. In the opinion of management, all estimates and adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2025 are not necessarily indicative of the results that may be expected for the year ending December 31, 2025. This Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in L.B. Foster Company’s Annual Report on Form 10-K for the year ended December 31, 2024. In this Quarterly Report on Form 10-Q, references to “we,” “us,” “our,” and the “Company” refer collectively to L.B. Foster Company and its consolidated subsidiaries.

Recently Issued Accounting Standards

In November 2023, the FASB issued Accounting Standards Update 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which requires enhanced disclosures regarding significant segment expenses that are regularly reviewed by the chief operating decision maker (“CODM”) and included in each reported measure of segment operating income or loss, including an amount for “other segment items” by reportable segment and a description of its composition. ASU 2023-07 also requires entities to disclose the title and position of the CODM and an explanation of how the CODM uses reported measures of segment operating income or loss to assess performance and allocate resources. The Company adopted this guidance for the interim period ended March 31, 2025 and applied the guidance retrospectively to all periods presented in the financial statements contained in this Quarterly Report on Form 10-Q. The expanded disclosures of the provision of ASU 2023-07 are included in Note 2. ASU 2023-07 affects only disclosures with no impacts to the Company’s financial condition, results of operations, and cash flows.

In December 2023, the FASB issued Accounting Standards Update 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires entities to disclose additional information with respect to the effective tax rate reconciliation and disaggregation of income tax expense and income taxes paid by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of ASU 2023-09, but expects this ASU to only impact its disclosures with no impacts to its consolidated financial condition, results of operations, and cash flows.

In November 2024, the FASB issued Accounting Standards Update 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), which requires entities to provide more detailed disaggregation of expenses in the income statement, focusing on the nature of the expenses rather than their function. The new disclosures will require public business entities to disclose in the notes to the financial statements, at each interim and annual reporting period, specific information about certain costs and expenses, including purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each expense caption presented on the face of the income statement, and the total amount of an entity's selling expenses. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, and may be applied either prospectively or retrospectively. Early adoption is permitted. The Company is currently evaluating the impact of adopting this guidance on the consolidated financial statements.

Note 2. Business Segments

The Company is a global technology solutions provider of engineered, manufactured products and services that builds and supports infrastructure. The Company determines its operating segments based on how the Company's Chief Operating Decision Maker, the Company's President and Chief Executive Officer, manages the businesses, including resource allocation and operating decisions. The Company is organized into two operating segments, which represent the individual businesses that are run separately within this operational structure.

Operating segments are evaluated on their segment operating income contribution to the Company’s consolidated results. The Company considers the aggregation of operating segments into reporting segments based on the nature of offerings, nature of production services, the type or class of customer for products and services, methods used to distribute products and services, and economic and regulatory environment conditions.

Table of Contents

The Company has two reportable segments: Rail, Technologies, and Services (“Rail”), and Infrastructure Solutions (“Infrastructure”). The Company’s segments represent components of the Company (a) that engage in activities from which revenue is generated and expenses are incurred, (b) whose operating results are regularly reviewed by the CODM, who uses such information to make decisions about resources to be allocated to the segments, and (c) for which discrete financial information is available. The CODM uses segment operating income to determine resources to allocate to each segment (including personnel and financial resources) during the annual budgeting process. The CODM evaluates segment performance regularly by comparing the segment operating income to the budgeted measure.

Segment operating income includes reportable segment gross profit and direct expenses such as salaries, benefits, restructuring, research and development, professional and purchased services expenditures, amortization expense, bad debt expense, and other segment expenses. Additionally, segment operating income includes allocated corporate operating expenses associated with central services such as quality, logistics, environmental health and safety, information technology, insurance, and human resources. Other corporate functional costs that are associated with the operating segments are also allocated to the segments such as finance, marketing, credit and collections, and treasury functions. Operating expenses related to corporate headquarter functions are allocated to each segment based on segment headcount, revenue contribution, or activity of the business units within the segments, based on the corporate activity type provided to the segment. Management believes the allocation of corporate operating expenses provides an accurate presentation of how the segments utilize corporate support activities. This provides the CODM meaningful segment profitability information to support operating decisions and the allocation of resources.

Certain corporate costs are separately managed on a consolidated basis and are not allocated to the operating segments. These corporate costs include public company costs such as listing fees, audit fees, compliance costs, insurance costs, and Board of Directors fees. Additionally, certain corporate executive management costs, including costs of the corporate executive leadership team, and corporate management stock-based compensation expenses are not allocated to the operating segments. Finally, interest expense, income taxes, and certain other items included in other income - net, which are managed on a consolidated basis, are not allocated to the operating segments.

The operating results of the Company’s reportable segments were as follows for the periods presented:


	Three Months Ended March 31, 2025
	Rail, Technologies, and Services		Infrastructure Solutions		Total
Net sales	$	54,015	$	43,777	$	97,792
Less:
Cost of sales	(41,986)		(35,655)		(77,641)


Selling and administrative employment costs	(7,399)		(5,564)		(12,963)
Purchased services(1)	(1,673)		(1,358)		(3,031)
General administrative costs(2)	(1,993)		(1,342)		(3,335)


Amortization expense	(820)		(302)		(1,122)

Segment operating income (loss)	$	144	$	(444)	$	(300)

Reconciliation of segment operating loss
Total segment operating loss					$	(300)
Interest expense - net					(1,143)
Other income - net					318
Public company costs					(1,154)
Corporate executive management costs					(220)
Corporate management stock-based compensation					(278)
Other corporate expenses - net					29
Loss before income taxes					$	(2,748)

(1) Purchased services costs include contractor services, insurance expenditures, rental expense, and legal services.

(2) General administrative costs generally include office supplies, utilities, advertising, bad debt expense, depreciation and restructuring expenditures.

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	Three Months Ended March 31, 2024
	Rail, Technologies, and Services		Infrastructure Solutions		Total
Net sales	$	82,623	$	41,697	$	124,320
Less:
Cost of sales	(64,052)		(34,092)		(98,144)


Selling and administrative employment costs	(7,482)		(5,818)		(13,300)
Purchased services(1)	(1,939)		(1,578)		(3,517)
General administrative costs(2)	(1,501)		(1,251)		(2,752)
Amortization expense

SEC Form 10-Q filed by L.B. Foster Company