Table of Contents

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 September 30, 2017March 31, 2019 
Or
 
☐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)
Pennsylvania25-1324733
(State of Incorporation)
(I. R. S. Employer
Identification No.)

415 Holiday Drive, Suite 100, Pittsburgh, Pennsylvania15220
(Address of principal executive offices)(Zip Code)
(412) 928-3400
(Registrant’s telephone number, including area code)

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 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 and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).    Yes  ☒    No  ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitionthe definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer☐Accelerated filer☒
Non-accelerated filer ☐☐  (Do not check if a smaller reporting company)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 checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No ☒

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, Par Value $0.01FSTRNASDAQ Global Select Market

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
ClassOutstanding as of October 31, 2017May 3, 2019
Common Stock, Par Value $0.0110,340,57610,581,281 Shares




L.B. FOSTER COMPANY AND SUBSIDIARIES
INDEX
 
Page
Page
PART I. Financial Information
Item 1. Financial Statements (unaudited):Statements:
Condensed Consolidated Balance Sheets
3
Condensed Consolidated Statements of Operations
4
Condensed Consolidated Statements of Comprehensive Income (Loss)
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
2321
Item 3. Quantitative and Qualitative Disclosures about Market Risk
3726
Item 4. Controls and Procedures
3726
27
Item 1. Legal Proceedings
3827
Item 1A. Risk Factors
3827
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
3827
Item 4. Mine Safety Disclosures
3827
Item 6. Exhibits
3928
Signature
4029



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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,
2019		December 31,
2018
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents$9,039 $10,282 
Accounts receivable - net (Note 5)99,518 86,123 
Inventories - net (Note 6)142,714 124,504 
Other current assets7,752 5,763 
Total current assets259,023 226,672 
Property, plant, and equipment - net (Note 7)85,870 86,857 
Operating lease right-of-use assets - net (Note 8)13,116 — 
Other assets:
Goodwill (Note 4)19,422 19,258 
Other intangibles - net (Note 4)48,298 49,836 
Other assets488 626 
TOTAL ASSETS$426,217 $383,249 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable$90,419 $78,269 
Deferred revenue14,168 6,619 
Accrued payroll and employee benefits7,598 12,993 
Accrued warranty (Note 14)1,715 2,057 
Current portion of accrued settlement (Note 14)8,000 10,000 
Current maturities of long-term debt (Note 9)609 629 
Other accrued liabilities14,964 13,624 
Total current liabilities137,473 124,191 
Long-term debt (Note 9)89,573 74,353 
Deferred tax liabilities (Note 15)5,142 5,287 
Long-term portion of accrued settlement (Note 14)40,000 40,000 
Long-term operating lease liabilities (Note 8)9,812 — 
Other long-term liabilities16,959 17,299 
Stockholders' equity:
Common stock, par value $0.01, authorized 20,000,000 shares; shares issued at March 31, 2019 and December 31, 2018, 11,115,779; shares outstanding at March 31, 2019 and December 31, 2018, 10,404,347 and 10,366,007, respectively 111 111 
Paid-in capital47,400 48,040 
Retained earnings118,647 114,324 
Treasury stock - at cost, 711,432 and 749,772 common stock shares at March 31, 2019 and December 31, 2018, respectively(17,196)(18,165)
Accumulated other comprehensive loss(21,704)(22,191)
Total stockholders' equity127,258 122,119 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY$426,217 $383,249 
  September 30,
2017		 December 31,
2016
  (Unaudited)  
ASSETS    
Current assets:    
Cash and cash equivalents $35,008
 $30,363
Accounts receivable - net 79,324
 66,632
Inventories - net 104,035
 83,243
Prepaid income tax 1,048
 14,166
Other current assets 9,986
 5,200
Total current assets 229,401
 199,604
Property, plant, and equipment - net 98,536
 103,973
Other assets:    
Goodwill 19,699
 18,932
Other intangibles - net 59,135
 63,519
Investments 151
 4,031
Other assets 2,242
 2,964
Total assets $409,164
 $393,023
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current liabilities:    
Accounts payable $59,825
 $37,744
Deferred revenue 11,038
 7,597
Accrued payroll and employee benefits 10,353
 7,497
Accrued warranty 9,614
 10,154
Current maturities of long-term debt 9,887
 10,386
Other accrued liabilities 8,452
 8,953
Total current liabilities 109,169
 82,331
Long-term debt 128,398
 149,179
Deferred tax liabilities 11,044
 11,371
Other long-term liabilities 16,734
 16,891
Stockholders' equity:    
Common stock, par value $0.01, authorized 20,000,000 shares; shares issued at September 30, 2017 and December 31, 2016, 11,115,779; shares outstanding at September 30, 2017 and December 31, 2016, 10,340,576 and 10,312,625, respectively 111
 111
Paid-in capital 44,423
 44,098
Retained earnings 137,492
 133,667
Treasury stock - at cost, common stock, shares at September 30, 2017 and December 31, 2016, 775,203 and 803,154, respectively (18,662) (19,336)
Accumulated other comprehensive loss (19,545) (25,289)
Total stockholders' equity 143,819
 133,251
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $409,164
 $393,023


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
(In thousands, except per share data)
Three Months Ended
March 31,
20192018
(Unaudited)
Sales of goods$113,083 $91,811 
Sales of services37,386 30,643 
Total net sales150,469 122,454 
Cost of goods sold92,331 75,136 
Cost of services sold28,976 25,126 
Total cost of sales121,307 100,262 
Gross profit29,162 22,192 
Selling and administrative expenses21,917 20,458 
Amortization expense1,712 1,785 
Interest expense - net1,355 1,887 
Other income(150)(605)
Total expenses24,834 23,525 
Income (loss) before income taxes4,328 (1,333)
Income tax expense638 525 
Net income (loss)$3,690 $(1,858)
Basic earnings (loss) per common share$0.36 $(0.18)
Diluted earnings (loss) per common share$0.35 $(0.18)
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
  (Unaudited) (Unaudited)
Sales of goods $103,058
 $100,293
 $318,414
 $326,278
Sales of services 28,434
 14,351
 76,640
 50,670
Total net sales 131,492
 114,644
 395,054
 376,948
Cost of goods sold 82,460
 81,674
 256,152
 260,705
Cost of services sold 22,667
 13,167
 63,549
 44,667
Total cost of sales 105,127
 94,841
 319,701
 305,372
Gross profit 26,365
 19,803
 75,353
 71,576
Selling and administrative expenses 20,218
 19,807
 60,023
 65,941
Amortization expense 1,764
 1,763
 5,218
 7,818
Asset impairments —
 6,946
 —
 135,884
Interest expense 2,026
 1,520
 6,315
 4,342
Interest income (56) (50) (166) (157)
Equity in (income) loss of nonconsolidated investments (50) 263
 5
 946
Other income (551) (1,085) (564) (263)
  23,351
 29,164
 70,831
 214,511
Income (loss) before income taxes 3,014
 (9,361) 4,522
 (142,935)
Income tax (benefit) expense (208) (3,379) 698
 (42,125)
Net income (loss) $3,222
 $(5,982) $3,824
 $(100,810)
Basic earnings (loss) per common share $0.31
 $(0.58) $0.37
 $(9.82)
Diluted earnings (loss) per common share $0.31
 $(0.58) $0.37
 $(9.82)
Dividends paid per common share $—
 $0.04
 $—
 $0.12

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 INCOME (LOSS)
(In thousands)
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
  (Unaudited) (Unaudited)
Net income (loss) $3,222
 $(5,982) $3,824
 $(100,810)
Other comprehensive income (loss), net of tax:        
Foreign currency translation adjustment 2,412
 (1,431) 5,528
 (3,438)
Unrealized gain (loss) on cash flow hedges, net of tax expense (benefit) of $0, $88 and $0, ($815) 82
 137
 (119) (1,286)
Reclassification of pension liability adjustments to earnings, net of tax expense of $0, $38 and $0, $115* 114
 73
 335
 223
Other comprehensive income (loss) 2,608
 (1,221) 5,744
 (4,501)
Comprehensive income (loss) $5,830
 $(7,203) $9,568
 $(105,311)
Three Months Ended
March 31,
20192018
(Unaudited)
Net income (loss)$3,690 $(1,858)
Other comprehensive income, net of tax:
Foreign currency translation adjustment1,053 24 
Unrealized (loss) gain on cash flow hedges, net of tax expense of $0 for all periods(26)738 
Reclassification of pension liability adjustments to earnings, net of tax expense of $0 for all periods*93 114 
Other comprehensive income1,120 876 
Comprehensive income (loss)$4,810 $(982)
 
*Reclassifications out of accumulated other comprehensive loss for pension obligations are charged to selling and administrative expense.expenses.
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
(In thousands)

Three Months Ended
March 31,
20192018
(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)$3,690 $(1,858)
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
Deferred income taxes(166)(1,258)
Depreciation2,772 2,944 
Amortization1,712 1,785 
Equity in (gain) loss of nonconsolidated investments(21)3 
Loss on sales and disposals of property, plant, and equipment— 3 
Stock-based compensation855 1,082 
Change in operating assets and liabilities:
Accounts receivable(13,166)10 
Inventories(17,463)(3,046)
Other current assets(1,961)(2,775)
Prepaid income tax(108)(277)
Other noncurrent assets591 230 
Accounts payable12,653 10,759 
Deferred revenue7,542 82 
Accrued payroll and employee benefits(5,438)(5,615)
Accrued settlement(2,000)— 
Other current liabilities(2,305)576 
Other long-term liabilities(733)(54)
Net cash (used in) provided by operating activities(13,546)2,591 
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of property, plant, and equipment59 9 
Capital expenditures on property, plant, and equipment(2,572)(723)
Net cash used in investing activities(2,513)(714)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of debt(43,414)(60,639)
Proceeds from debt58,614 33,076 
Treasury stock acquisitions(526)(310)
Net cash provided by (used in) financing activities14,674 (27,873)
Effect of exchange rate changes on cash and cash equivalents142 (698)
Net decrease in cash and cash equivalents(1,243)(26,694)
Cash and cash equivalents at beginning of period10,282 37,678 
Cash and cash equivalents at end of period$9,039 $10,984 
Supplemental disclosure of cash flow information:
Interest paid$1,179 $964 
Income taxes paid$904 $994 
  Nine Months Ended
September 30,
  2017 2016
  (Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income (loss) $3,824
 $(100,810)
Adjustments to reconcile net loss to cash provided (used) by operating activities:    
Deferred income taxes (648) (39,690)
Depreciation 9,705
 10,620
Amortization 5,218
 7,818
Asset impairments —
 135,884
Equity loss of nonconsolidated investments 5
 946
(Gain) loss on sales and disposals of property, plant, and equipment (347) 209
Share-based compensation 1,228
 875
Income tax deficiency from share-based compensation —
 124
Change in operating assets and liabilities    
Accounts receivable (11,899) 13,491
Inventories (19,336) 3,188
Other current assets (786) (379)
Prepaid income tax 12,569
 (6,436)
Other noncurrent assets 719
 117
Accounts payable 22,017
 (13,256)
Deferred revenue 3,339
 866
Accrued payroll and employee benefits 2,734
 (2,294)
Other current liabilities (763) 956
Other liabilities (63) (353)
Net cash provided by operating activities 27,516
 11,876
CASH FLOWS FROM INVESTING ACTIVITIES:    
Proceeds from the sale of property, plant, and equipment 1,388
 923
Capital expenditures on property, plant, and equipment (5,335) (6,507)
Loans and capital contributions to equity method investment —
 (635)
Net cash used by investing activities (3,947) (6,219)

L.B. FOSTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(In thousands)

  Nine Months Ended
September 30,
  2017 2016
  (Unaudited)
CASH FLOWS FROM FINANCING ACTIVITIES:    
Repayments of debt (113,119) (134,200)
Proceeds from debt 91,838
 101,075
Financing fees —
 (712)
Treasury stock acquisitions (103) (265)
Cash dividends on common stock paid to shareholders —
 (1,244)
Income tax deficiency from share-based compensation —
 (124)
Net cash used by financing activities (21,384) (35,470)
Effect of exchange rate changes on cash and cash equivalents 2,460
 152
Net increase (decrease) in cash and cash equivalents 4,645
 (29,661)
Cash and cash equivalents at beginning of period 30,363
 33,312
Cash and cash equivalents at end of period $35,008
 $3,651
Supplemental disclosure of cash flow information:    
Interest paid $5,599
 $3,485
Income taxes (received) paid $(11,233) $3,991

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
(Dollars in thousands)

Three Months Ended March 31, 2019 
Common
Stock		Paid-in
Capital		Retained
Earnings		Treasury
Stock		Accumulated
Other
Comprehensive
(Loss) Income		Total
Balance, December 31, 2018$111 $48,040 $114,324 $(18,165)$(22,191)$122,119 
Adjustment to adopt ASU 2018-02— — 633 — (633)— 
Net income— — 3,690 — — 3,690 
Other comprehensive income, net of tax:
Pension liability adjustment— — — — 93 93 
Foreign currency translation adjustment— — — — 1,053 1,053 
Unrealized derivative loss on cash flow hedges— — — — (26)(26)
Issuance of 38,340 common shares, net of shares withheld for taxes— (1,495)— 969 — (526)
Stock-based compensation— 855 — — — 855 
Balance, March 31, 2019$111 $47,400 $118,647 $(17,196)$(21,704)$127,258 

Three Months Ended March 31, 2018
Common
Stock		Paid-in
Capital		Retained
Earnings		Treasury
Stock		Accumulated
Other
Comprehensive
(Loss) Income		Total
Balance, December 31, 2017$111 $45,017 $145,797 $(18,662)$(17,767)$154,496 
Adjustment to adopt ASU 2016-16— — (305)— — (305)
Net loss— — (1,858)— — (1,858)
Other comprehensive income, net of tax:
Pension liability adjustment— — — — 114 114 
Foreign currency translation adjustment— — — — 24 24 
Unrealized derivative gain on cash flow hedges— — — — 738 738 
Issuance of 24,769 common shares, net of shares withheld for taxes— (792)— 482 — (310)
Stock-based compensation— 1,082 — — — 1,082 
Balance, March 31, 2018$111 $45,307 $143,634 $(18,180)$(16,891)$153,981 

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 inIn thousands, except share data)
Note 1. FINANCIAL STATEMENTSFinancial Statements
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 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principlesGAAP for complete financial statements. In the opinion of management, all estimates and adjustments (consisting of normal recurring accruals)accruals, unless otherwise stated herein) considered necessary for a fair presentation of the financial position of L.B. Foster Company and subsidiaries as of March 31, 2019 and December 31, 2018, and its condensed consolidated statements of operations, its condensed consolidated statements of cash flows and, its condensed consolidated statements of stockholders' equity for the three months ended March 31, 2019 and 2018, have been included. However, actual results could differ from those estimates. The results of operations for interim periods are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.2019. The year-end Condensed Consolidated Balance Sheet as of December 31, 20162018 was derived from audited financial statements. This Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016.2018. 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.

Assets Held for Sale
The Company classifies assets as held for sale when management approves and commits to a formal plan of sale with the expectation the sale will be completed within one year.  The net assets of the business held for sale are then recorded at the lower of their current carrying value or the fair market value, less costs to sell.  See Note 7 Investments of the Notes to Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q for additional information.


Recently Issued Accounting Standards
In May 2014,August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. (“ASU”) 2014-09, “Revenue from Contracts with Customers (Topic 606)”2018-15, "Intangibles - Goodwill and Other - Internal-Use Software" (“ASU 2014-09”), which supersedes the revenue recognition requirements in Accounting Standards Codification 605, “Revenue Recognition” (“ASC 605”2018-15”). The ASU 2014-09 is based on the principle that revenue is recognized to depict the transferrequires capitalization of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue, cash flows arising from customer contracts, including significant judgments and changes in judgments, and assets recognized fromcertain implementation costs incurred to obtain or fulfillin a cloud computing arrangement that qualifies as a service contract. The amendments in the ASU 2014-09 isare effective for fiscal years beginning after December 15, 2017, including2019 and for interim periods within that reporting period.therein with early adoption permitted. The Company continuesis currently evaluating the potential impact of the ASU on its project adoption plan by performing a detailed evaluation of contracts and sales orders with customers and assessing the impact that this standard will have on the Company’s results of operations, cash flows,consolidated financial position, and backlog. We have also been assessing the impact to internal controls over financial reporting and disclosure requirements. We regularly brief our Audit Committee on our overall project plan as well as our progress towards adoption. The Company will adopt this standard as of January 1, 2018 and anticipates using the modified retrospective approach at adoption as it relates to ASU 2014-09.statements.


Recently Adopted Accounting Standards
In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The new accounting requirements include the accounting for, presentation of, and classification of leases. The guidance will resultresulted in most leases being capitalized as a right of useright-of-use asset with a related liability on our balance sheets.sheet liability. The requirements of the new standard are effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods. The Company is inadopted the process of analyzing the impactprovisions of ASU 2016-02 on our financial position.January 1, 2019, using the modified retrospective approach as of the beginning of the period of adoption. Additionally, the Company has elected to apply the practical expedient package for leases that commenced prior to the effective date, not to apply the recognition requirements in the standard to short-term leases, and not to separate non-lease components from lease components. The Company has a significant number of operating leases, and, as a result, expects this guidance to have a material impact on its Condensed Consolidated Balance Sheet. The Company does not anticipate early adoption as it relates topresented the disclosures required by ASU 2016-02.2016-02 in Note 8.


In October 2016,February 2018, the FASB issued ASU 2016-16,2018-02, “Income TaxesStatement – Intra-Entity TransfersReporting Comprehensive Income; Reclassification of AssetsCertain Tax Effects from Accumulated Other Than Inventory (Topic 740),”Comprehensive Income” (“ASU 2016-16”2018-02”), which allows companies to reclassify stranded tax effects caused by the US Tax Cuts and Jobs Act (the “Tax Act”) which will require an entityfrom accumulated other comprehensive income to recognizeretained earnings. The amendments eliminate the stranded tax effects resulting from the Tax Act and improve the usefulness of information reported to financial statement users. However, because the amendments only relate to the reclassification of the income tax consequenceseffects of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. The ASU is effective on January 1, 2018 with early adoption permitted. The Company continues to evaluateTax Act, the impact this standard will have on the Company’s financial statements but believes there will not be a material change once adopted. The Company will not elect early adoption of ASU 2016-16.

In March 2017, the FASB issued ASU 2017-07, “Compensation – Retirement Benefits (Topic 715),” (“ASU 2017-07”) which improves the presentation of net periodic pension cost and net periodic postretirement benefit cost. Theunderlying guidance that requires that the entity reporteffect of a change in tax laws or rates be included in income from continuing operations is not affected. The Company adopted ASU 2018-02 during the service cost componentfirst quarter of 2019 and has chosen to record the reclassification as of the beginning of the period of adoption. As a result of adopting this standard, we reclassified stranded tax effects of $633 from Accumulated other comprehensive loss to Retained earnings.

The SEC Disclosure Update and Simplification release announces the SEC's adoption of certain amendments in August 2018. While most of the amendments eliminate outdated or duplicative disclosure requirements, the final rule amends the interim financial statement requirements to require a reconciliation of changes in stockholders’ equity in the same line itemnotes to the financial statements or items as other compensation costs arising from services rendered bya separate statement. This analysis should reconcile the pertinent employees duringbeginning balance to the ending balance of each caption in stockholders’ equity for each period for which an income statement is required to be filed and reportcomply with the other componentsremaining content requirements of net periodic pension costRule 3-04 of Regulation S-X. As a result, registrants are required to provide the reconciliation for both the comparable quarterly and net

periodic postretirement benefit costyear-to-date periods in its Quarterly Report on Form 10-Q but only for the year-to-date periods in registration statements, beginning in the income statement separately from the service cost component and outside a subtotalfirst quarter of income from operations. Of the components of net periodic benefit cost, only the service cost component will be eligible for asset capitalization. The new standard will be effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods.2019. The Company is evaluating its implementation approach and assessinghas included the impactreconciliation of ASU 2017-07 on the presentation of operations.changes in stockholders’ equity as a separate statement.
Note 2. BUSINESS SEGMENTSBusiness Segments
The Company is a leading manufacturer and distributor of products and services for transportation and energy infrastructure with locations in North America and Europe. The Company is organized and evaluated by product group, which isoperates in three different operating segments: the basis for identifying reportable segments. EachRail
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Products and Services segment, represents a revenue-producing componentthe Construction Products segment, and the Tubular and Energy Services segment. The 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 Chief Operating Decision Maker (“CODM”), who makes decisions about resources to be allocated to the segments, and (c) for which separatediscrete financial information is produced internally that is subject to evaluation by the Company’s chief operating decision maker in deciding how to allocate resources. Each segment isavailable. Operating segments are evaluated based upon itson their segment profit contribution to the Company’sCompany's consolidated results. Other income and expenses, interest, income taxes, and certain other items are managed on a consolidated basis. The Company's segment accounting policies, unless otherwise noted, are the same as those described in the Note 2. Business Segments of the Notes to the Company's Consolidated Financial Statements contained in its Annual Report on Form 10-K for the year-ended December 31, 2018.


The following table illustrates the Company's revenues and profits (losses)profit from operations of the Company by segment for the periods indicated:
Three Months Ended
March 31, 2019		Three Months Ended
March 31, 2018
Net SalesSegment ProfitNet SalesSegment Profit
Rail Products and Services$75,694 $3,479 $62,170 $2,048 
Construction Products37,345 834 28,900 18 
Tubular and Energy Services37,430 4,688 31,384 1,885 
Total$150,469 $9,001 $122,454 $3,951 
  Three Months Ended
September 30, 2017		 Nine Months Ended
September 30, 2017
  Net Sales Segment Profit Net Sales Segment Profit
Rail Products and Services $62,095
 $3,472
 $187,922
 $8,938
Construction Products 39,118
 3,387
 121,905
 9,156
Tubular and Energy Services 30,279
 2,298
 85,227
 1,774
Total $131,492
 $9,157
 $395,054
 $19,868
  Three Months Ended
September 30, 2016		 Nine Months Ended
September 30, 2016
  Net Sales Segment Profit (Loss) Net Sales Segment Profit (Loss)
Rail Products and Services $56,891
 $(2,047) $188,686
 $(26,474)
Construction Products 34,870
 1,356
 107,098
 5,748
Tubular and Energy Services 22,883
 (6,966) 81,164
 (111,876)
Total $114,644
 $(7,657) $376,948
 $(132,602)


Segment profit (loss) from operations, as shown above, include internal cost of capital charges for assets used inincludes allocated corporate operating expenses. Operating expenses related to corporate headquarter functions that directly support the segment at a rateactivity are allocated based on segment headcount, revenue contribution, or activity of generally 1% per month. There has been no change in the measurement of segment profit (loss)business units within the segments, based on the corporate activity type provided to the segment. The expense allocation excludes certain corporate costs that are separately managed from operations since December 31, 2016. The internal cost of capital charges are eliminated during the consolidation process.segments.


The following table provides a reconciliation of reportable segment net profit (loss) from operations to the Company’s consolidated total:
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
Profit (loss) for reportable segments $9,157
 $(7,657) $19,868
 $(132,602)
Interest expense (2,026) (1,520) (6,315) (4,342)
Interest income 56
 50
 166
 157
Other income 551
 1,085
 564
 263
LIFO (expense) income (1,552) 917
 (1,733) 1,442
Equity in income (loss) of nonconsolidated investments 50
 (263) (5) (946)
Corporate expense, cost of capital elimination, and other unallocated charges (3,222) (1,973) (8,023) (6,907)
Income (loss) before income taxes $3,014
 $(9,361) $4,522
 $(142,935)
Three Months Ended
March 31,
20192018
Profit for reportable segments$9,001 $3,951 
Interest expense - net(1,355)(1,887)
Other income150 605 
Unallocated corporate expenses and other unallocated charges(3,468)(4,002)
Income (loss) before income taxes$4,328 $(1,333)


The following table illustrates assets of the Company by segment:
March 31,
2019		December 31,
2018
Rail Products and Services$188,517 $175,704 
Construction Products112,584 97,133 
Tubular and Energy Services99,485 90,402 
Unallocated corporate assets25,631 20,010 
Total$426,217 $383,249 

Note 3. Revenue
Revenue from products or services provided to customers over time accounted for 27.7% and 25.5% of revenue for the three months ended March 31, 2019 and 2018, respectively. Revenue under these long-term agreements is generally recognized over time either using an input measure based upon the proportion of actual costs incurred to estimated total project costs or an input measure based upon actual labor costs as a percentage of estimated total labor costs, depending upon which measure the Company believes best depicts the Company’s performance to date under the terms of the contract. Revenue recognized over time using an input measure was $31,837 and $24,561 for the three months ended March 31, 2019 and 2018, respectively. A certain portion of the Company’s revenue recognized over time under these long-term agreements is recognized using an output method, specifically units delivered, based upon certain customer acceptance and delivery requirements. Revenue recognized over time using an output measure was $9,911 and $6,661 for the three months ended March 31, 2019 and 2018, respectively. As of March 31, 2019 and December 31, 2018, the Company had contract assets of $33,599 and $26,692, respectively, that were recorded in “Inventory” within the Condensed Consolidated Balance Sheets. As of March 31, 2019 and December 31, 2018, the Company had contract liabilities of $3,720 and $1,505, respectively, that were recorded in “Deferred revenue” within the Condensed Consolidated Balance Sheets.

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  September 30,
2017		 December 31,
2016
Rail Products and Services $198,761
 $174,049
Construction Products 88,542
 81,074
Tubular and Energy Services 100,046
 100,006
Unallocated corporate assets 21,815
 37,894
Total $409,164
 $393,023
The majority of the Company’s revenue is from products transferred and services rendered to customers at a point in time. Point in time revenue accounted for 72.3% and 74.5% of revenue for the three months ended March 31, 2019 and 2018, respectively. The Company recognizes revenue at the point in time at which the customer obtains control of the product or service, which is generally when the product title passes to the customer upon shipment or the service has been rendered to the customer. In limited cases, title does not transfer and revenue is not recognized until the customer has received the products at its physical location.

3. GOODWILL AND OTHER INTANGIBLE ASSETSThe following table summarizes the Company's net sales by major product and service category:
Three Months Ended
March 31,
20192018
Rail Products$46,206 $36,034 
Rail Technologies29,488 26,136 
Rail Products and Services75,694 62,170 
Piling and Fabricated Bridge23,732 18,861 
Precast Concrete Products13,613 10,039 
Construction Products37,345 28,900 
Test, Inspection, and Threading Services14,724 14,213 
Protective Coatings and Measurement Systems22,706 17,171 
Tubular and Energy Services37,430 31,384 
Total net sales$150,469 $122,454 

Net sales by the timing of the transfer of goods and services is as follows:
Three Months Ended March 31, 2019
Rail Products and
Services		Construction
Products		Tubular and Energy
Services		Total
Point in time$56,492 $23,095 $29,134 $108,721 
Over time19,202 14,250 8,296 41,748 
Total net sales$75,694 $37,345 $37,430 $150,469 
Three Months Ended March 31, 2018
Rail Products and
Services		Construction
Products		Tubular and Energy
Services		Total
Point in time$45,871 $18,926 $26,435 $91,232 
Over time16,299 9,974 4,949 31,222 
Total net sales$62,170 $28,900 $31,384 $122,454 

The timing of revenue recognition, billings, and cash collections results in billed receivables, costs in excess of billings (contract assets, included in “Inventory”), and billings in excess of costs (contract liabilities, included in “Deferred revenue”) on the Condensed Consolidated Balance Sheets.

Significant changes in contract assets during the three months ended March 31, 2019 resulted from transfers to receivables from contract assets recognized at the beginning of the period of $11,406. Significant changes in contract liabilities during the three months ended March 31, 2019 resulted from increases of $3,384 due to billings in excess of costs, excluding amounts recognized as revenue during the period, and reductions due to revenue recognized during the three months ended March 31, 2019 and 2018 of $948 and $346, respectively, that was included in the contract liability at the beginning of each period.

As of March 31, 2019, the Company had approximately $250,052 of remaining performance obligations, which is also referred to as backlog. Approximately 3.1% of the March 31, 2019 backlog was related to projects that are anticipated to extend beyond March 31, 2020.




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Note 4. Goodwill and Other Intangible Assets
The following table presents the goodwill balance by reportable segment:
Rail Products and
Services		Construction
Products		Tubular and Energy
Services		Total
Balance as of December 31, 2018$14,111 $5,147 $— $19,258 
Foreign currency translation impact164 — — 164 
Balance as of March 31, 2019$14,275 $5,147 $— $19,422 
  Rail Products and
Services		 Construction
Products		 Tubular and Energy
Services		 Total
Balance at December 31, 2016 $13,785
 $5,147
 $—
 $18,932
Foreign currency translation impact 767
 —
 —
 767
Balance at September 30, 2017 $14,552
 $5,147
 $—
 $19,699


The Company performs goodwill impairment tests annually during the fourth quarter, and also performs interim goodwill impairment tests if it is determined that it is more likely than not that the fair value of a reporting unit is less than the carrying amount. Qualitative factors are assessed to determine whether it is more likely than not that the fair value of a reporting unit is less than the carrying amount. No interim goodwill impairment test was required in connection with these evaluations for the nine months ended September 30, 2017. The Company continues to monitor the recoverabilityevaluation of the long-lived assets associated with certain reporting unitsqualitative factors as of the Company and the long-term financial projections of the businesses. Sustained declines in the markets we serve may result in future long-lived asset impairment.March 31, 2019.

The following table represents the gross other intangible assets balance by reportable segment:
  September 30,
2017		 December 31,
2016
Rail Products and Services $57,538
 $56,476
Construction Products 1,348
 1,348
Tubular and Energy Services 29,179
 29,179
  $88,065
 $87,003


The components of the Company’s intangible assets arewere as follows:
March 31, 2019
Weighted Average
Amortization
Period In Years		Gross
Carrying
Value		Accumulated
Amortization		Net
Carrying
Amount
Non-compete agreements4$1,386 $(1,139)$247 
Patents10366 (173)193 
Customer relationships1837,337 (12,069)25,268 
Trademarks and trade names158,497 (3,657)4,840 
Technology1435,688 (17,938)17,750 
$83,274 $(34,976)$48,298 
December 31, 2018
Weighted Average
Amortization
Period In Years		Gross
Carrying
Value		Accumulated
Amortization		Net
Carrying
Amount
Non-compete agreements4$1,372 $(1,046)$326 
Patents10358 (165)193 
Customer relationships1837,129 (11,388)25,741 
Trademarks and trade names158,481 (3,416)5,065 
Technology1435,640 (17,129)18,511 
$82,980 $(33,144)$49,836 
  September 30, 2017
  Weighted Average
Amortization
Period In Years		 Gross
Carrying
Value		 Accumulated
Amortization		 Net
Carrying
Amount
Non-compete agreements 5 $4,233
 $(2,872) $1,361
Patents 10 392
 (160) 232
Customer relationships 17 37,597
 (8,542) 29,055
Trademarks and trade names 14 10,078
 (3,879) 6,199
Technology 14 35,765
 (13,477) 22,288
    $88,065
 $(28,930) $59,135
         
  December 31, 2016
  Weighted Average
Amortization
Period In Years		 Gross
Carrying
Value		 Accumulated
Amortization		 Net
Carrying
Amount
Non-compete agreements 5 $4,219
 $(2,217) $2,002
Patents 10 373
 (143) 230
Customer relationships 18 36,843
 (6,582) 30,261
Trademarks and trade names 14 10,018
 (3,238) 6,780
Technology 14 35,550
 (11,304) 24,246
    $87,003
 $(23,484) $63,519


Intangible assets are amortized over their useful lives, which range from 4 to 25 years, with a total weighted average amortization period of approximately 15 years at September 30, 2017.as of March 31, 2019. Amortization expense was $1,712 and $1,785 for the three months ended September 30, 2017March 31, 2019 and 2016 was $1,764 and $1,763, respectively. Amortization expense for the nine months ended September 30, 2017 and 2016 was $5,218 and $7,818,2018, respectively.


EstimatedAs of March 31, 2019, estimated amortization expense for the remainder of 20172019 and thereafter iswas as follows:
Amortization Expense
Remainder of 2019$4,925 
20205,887 
20215,852 
20225,769 
20235,263 
2024 and thereafter20,602 
$48,298 

 Amortization Expense
2017$1,782
20187,024
20196,302
20205,980
20215,960
2022 and thereafter32,087
 $59,135
4. ACCOUNTS RECEIVABLENote 5. Accounts Receivable
Credit is extended based upon an evaluation of the customer’s financial condition and, while collateral is not required, the Company periodically receives surety bonds that guarantee payment. Credit terms are consistent with industry standards and practices. The
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amounts of trade accounts receivable at September 30, 2017as of March 31, 2019 and December 31, 20162018 have been reduced by an allowance for doubtful accounts of $2,138$1,014 and $1,417,$932, respectively. Changes in reserves for uncollectable accounts, which are recorded as part of “Selling and administrative expenses” in the Condensed Consolidated Statements of Operations, resulted in expense of $100 and income of $246 for the three months ended March 31, 2019 and 2018, respectively.

5. INVENTORIESNote 6. Inventory
Inventories at September 30, 2017as of March 31, 2019 and December 31, 20162018 are summarized in the following table:
March 31,
2019		December 31,
2018
Finished goods$77,449 $69,041 
Contract assets33,599 26,692 
Work-in-process7,494 6,940 
Raw materials24,172 21,831 
Inventories - net$142,714 $124,504 
  September 30,
2017		 December 31,
2016
Finished goods $58,588
 $46,673
Work-in-process 30,507
 21,716
Raw materials 19,851
 18,032
Total inventories at current costs 108,946
 86,421
Less: LIFO reserve (4,911) (3,178)
  $104,035
 $83,243


Inventory is generally valued at the lower of last-in, first-out (“LIFO”) cost or market. Other inventoriesInventories of the Company are valued at average cost or net realizable value, whichever is lower. An actual valuation of inventory under the LIFO method is made at the end of each year based on the inventory levels
Note 7. Property, Plant, and costs at that time. Interim LIFO calculations are based on management’s estimates of expected year-end levels and costs.
6. PROPERTY, PLANT, AND EQUIPMENTEquipment
Property, plant, and equipment at September 30, 2017as of March 31, 2019 and December 31, 2016 consist2018 consisted of the following:
March 31,
2019		December 31,
2018
Land$12,451 $12,440 
Improvements to land and leaseholds17,580 17,610 
Buildings36,387 34,608 
Machinery and equipment, including equipment under finance leases121,658 120,914 
Construction in progress2,434 3,083 
Gross property, plant, and equipment190,510 188,655 
Less accumulated depreciation and amortization, including accumulated amortization of finance leases(104,640)(101,798)
Property, plant, and equipment - net$85,870 $86,857 
  September 30,
2017		 December 31,
2016
Land $14,866
 $14,826
Improvements to land and leaseholds 17,404
 17,408
Buildings 34,503
 33,910
Machinery and equipment, including equipment under capitalized leases 120,414
 118,060
Construction in progress 1,431
 1,291
  188,618
 185,495
Less accumulated depreciation and amortization, including accumulated amortization of capitalized leases 90,082
 81,522
  $98,536
 $103,973


Depreciation expense for the three months ended March 31, 2019 and 2018 was $2,772 and $2,944, respectively.

We review our property, plant, and equipment for recoverability whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. We recognize an impairment loss if the carrying amount of a long-lived asset is not recoverable and exceeds its fair value. There were no asset impairments of property, plant, and equipment during the ninethree months ended SeptemberMarch 31, 2019 and 2018.
Note 8. Leases
On January 1, 2019, the Company adopted ASU 2016-02 and all the related amendments using the modified retrospective approach, which resulted in an increase in assets of $13,585 and an increase in current and long-term liabilities of $3,322 and $10,263, respectively. This adoption did not affect our results of operations, cash flows, or covenants of the Amended and Restated Credit Agreement dated March 13, 2015, and as amended by the Second Amendment dated November 7, 2016. This adoption will also have no impact to the covenants of the Third Amended and Restated Credit Agreement dated April 30, 2017.2019.


DepreciationWe determine if an arrangement is a lease at its inception. Operating leases are included in “Operating lease right-of-use assets,” “Other current liabilities,” and “Long-term operating lease liabilities” within our Condensed Consolidated Balance Sheets. Finance leases are included in “Property, plant, and equipment - net,” “Current maturities of long-term debt,” and “Long-term debt” in our Condensed Consolidated Balance Sheets.

Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of the lease payments. We use the implicit rate when readily determinable. The operating lease right-of-use also includes indirect costs incurred and lease payments made prior to the commencement date, less any lease incentives received. Our lease terms may include options to extend or terminate the lease and will be recognized when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the three-month periods ended September 30, 2017lease term.

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We have lease agreements with lease and 2016 was $3,178non-lease components which we account for as a single lease component. Also, for certain equipment leases, we apply a portfolio approach to effectively account for the operating lease right-of-use assets and $3,295, respectively. Forliabilities.

Finance lease and lessor accounting recognition has remained substantially unchanged under ASU 2016-02 and had no impact on the nine-month periods ended September 30, 2017 and 2016, depreciation expense was $9,705 and $10,620, respectively.Company's balance sheet, results of operations, or cash flows as a result of the adoption of ASU 2016-02.
7. INVESTMENTS
The Company is a memberhas operating and finance leases for manufacturing facilities, corporate offices, sales offices, vehicles, and certain equipment. As of a joint venture, L B Pipe & Coupling Products, LLC (“L B Pipe JV”), inMarch 31, 2019, our leases have remaining lease terms of 1 to 9 years, some of which it maintains a 45% ownership interest. L B Pipe JV manufactures, markets,include options to extend the leases for up to 5 years, and sells various machined components and precision coupling products for the energy, water well, and construction markets and is scheduledsome of which include options to terminate on June 30, 2019.the leases within 1 year. As of March 31, 2019, the Company’s operating leases have a weighted average remaining lease term of 6 years and a weighted average discount rate of 4.9%. As of March 31, 2019, the Company’s finance leases have a weighted average remaining lease term of 1 year and a weighted average discount rate of 4.3%.


Under applicable guidance for variable interest entities in ASC 810, “Consolidation,” the Company previously determined that L B Pipe JV was a variable interest entity. The Company concluded that it was not the primary beneficiarybalance sheet component of the variable interest entity,Company's leases were as the Company did not have a controlling financial interest and did not have the power to direct the activities that most significantly impact the economic performancefollows as of L B Pipe JV.March 31, 2019:

March 31, 2019
Operating leases
Operating lease right-of-use assets$13,116 
Other current liabilities$3,304 
Long-term operating lease liabilities9,812 
Total operating lease liabilities$13,116 
Finance leases
Property, plant, and equipment$3,462 
Accumulated amortization(2,668)
Property, plant, and equipment - net$794 
Current maturities of long-term debt$609 
Long-term debt184 
Total finance lease liabilities$793 
During the quarter ended September 30, 2017, pursuant to the limited liability company agreement, the Company determined to sell its 45% ownership interest to the other 45% equity holder.
The Company concluded that it has met the criteria under applicable guidance for a long-lived asset to be held for sale, and has, accordingly, reclassified L B Pipe JV investmentcomponents of $4,288 as a current asset held for salelease expense within other current assets. The asset was subsequently remeasured to its fair market value of $3,875. The difference between the fair market value and the Company's carrying amountstatements of $413 was recordedoperations were as an other-than-temporary impairment for the three and nine months ended September 30, 2017.


At September 30, 2017 and December 31, 2016, the Company had a nonconsolidated equity method investment of $0 and $3,902, respectively, in L B Pipe JV and other equity investments totaling $151 and $129, respectively.

The Company recorded equity in the income of L B Pipe JV of $434 and loss of $276follows for the three months ended September 30, 2017 and 2016, respectively. ForMarch 31, 2019:
March 31, 2019
Finance lease cost:
Amortization of finance leases$178 
Interest on lease liabilities9 
Operating lease cost916 
Sublease income(9)
Total lease cost$1,094 

The cash flow components of the nineCompany's leases were as follows for the three months ended September 30, 2017 and 2016,March 31, 2019:
March 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases$(1,079)
Financing cash flows from finance leases(181)
Right-of-use assets obtained in exchange for new lease liabilities:
Operating leases$447 









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As of March 31, 2019, estimated annual maturities of lease liabilities for the Company recorded equity in the income of L B Pipe JV of $386 and loss of $1,001, respectively.

During 2016, the Company and the other 45% member each executed a revolving line of credit with L B Pipe JV with an available limit of $1,350. The Company and the other 45% member each loaned $1,235 to L B Pipe JV in an effort to maintain compliance with L B Pipe JV’s debt covenants with an unaffiliated bank. The Company is to receive its outstanding loan balance at the 45% equity interest sale date.

The Company’s exposure to loss results from its capital contributions and loans, net of the Company’s share of L B Pipe JV’s income or loss, and its net investment in the direct financing lease covering the facility used by L B Pipe JV for its operations, which is described below. The carrying amounts with the Company’s maximum exposure to loss at September 30, 2017 andyear ending December 31, 2016, respectively,2019 and thereafter are as follows:
Operating LeasesFinance Leases
Remaining 2019$2,729 $491 
20203,068 337 
20212,223 16 
20221,750 — 
20231,405 — 
2024 and thereafter4,332 — 
Total undiscounted lease payments15,507 844 
Interest(2,391)(51)
Total$13,116 $793 

Note 9. Long-term Debt and Related Matters
  September 30,
2017		 December 31,
2016
L B Pipe JV equity method investment $3,875
 $3,902
Revolving line of credit 1,235
 1,235
Net investment in direct financing lease 770
 871
  $5,880
 $6,008

The Company is leasing five acres of land and two facilities to L B Pipe JV through June 30, 2019, with a 5.5 year renewal period. The current monthly lease payments approximate $17, with a balloon payment of approximately $488, which is required to be paid either at the termination of the lease, allocated over the renewal period, or during the initial term of the lease. This lease qualifies as a direct financing lease under the applicable guidance in ASC 840-30, “Leases.”

The following is a schedule of the direct financing minimum lease payments for the remainder of 2017 and the years 2018 and thereafter:
 Minimum Lease Payments
2017$35
2018150
2019585
 $770
8. LONG-TERM DEBT
United StatesNorth America
Long-term debt consistsconsisted of the following:
March 31,
2019		December 31,
2018
Revolving credit facility$89,389 $74,008 
Capital leases and financing agreements793 974 
Total90,182 74,982 
Less current maturities(609)(629)
Long-term portion$89,573 $74,353 
  September 30,
2017		 December 31,
2016
Revolving credit facility $123,494
 $127,073
Term loan 13,131
 30,000
Capital leases and financing agreements 1,660
 2,492
Total 138,285
 159,565
Less current maturities 9,887
 10,386
Long-term portion $128,398
 $149,179


On November 7, 2016, the Company, its domestic subsidiaries, and certain of its Canadian subsidiaries entered into the Second Amendment (the “Second Amendment”) to the Second Amended and Restated Credit Agreement dated March 13, 2015 and as amended by the First Amendment dated June 29, 2016 (the “Amended and Restated Credit Agreement”), with PNC Bank, N.A., Bank of America, N.A., Wells Fargo Bank, N.A., Citizens Bank of Pennsylvania, and Branch Banking and Trust Company. This Second Amendment modified the Amended and Restated Credit Agreement, which had a maximum revolving credit line of $275,000. The Second Amendment reduced the permitted revolving credit borrowings to $195,000 and provided

for additional term loan borrowing of $30,000 (the “Term Loan”). The Term Loan is subject to quarterly straight line amortization until fullyDuring 2017, the Company paid off upon the final payment on January 1, 2020. Furthermore, certain matters, including excess cash flow, asset sales, and equity issuances, trigger mandatory prepayments tobalance of the Term Loan. Term Loan borrowings are not available to draw upon once they have been repaid. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Second Amendment or Amended and Restated Credit Agreement filed as Exhibit 10.3 to the Company's Annual Report on Form 10-K for the year ended December 31, 2018, as applicable.


The Second Amendment further provided for modifications to the financial covenants as defined in the Amended and Restated Credit Agreement. The Second Amendment calls for the eliminationeliminated of the Maximum Leverage Ratio covenant through the quarter endingended June 30, 2018. After that period, the Maximum Gross Leverage Ratio covenant will bewas reinstated to require a maximum ratio of 4.25 Consolidated Indebtedness to 1.00 Gross Leverage for the quarter endingended September 30, 2018, and 3.75 to 1.00 for all periods thereafter until the maturity date of the credit facility. The Second Amendment also includes a Minimum Last Twelve Months EBITDA covenant (“Minimum EBITDA”). For the quarter ended December 31, 2016 through the quarter ended June 30, 2017, the Minimum EBITDA had to be at least $18,500. For each quarter thereafter, through the quarter endingended June 30, 2018, the Minimum EBITDA requirement will increaseincreased by various increments. The incremental Minimum EBITDA requirement for the period ended September 30, 2017 was at least $23,000. AtOn June 30, 2018, the Minimum EBITDA requirement will bewas $31,000. After the quarter endingended June 30, 2018, the Minimum EBITDA covenant will bewas eliminated through the maturityremainder of the Amended and Restated Credit Agreement. The Second Amendment also includes a Minimum Fixed Charge Coverage Ratio covenant. The covenant represents the ratio of the Company’s fixed charges to the last twelve months of EBITDA, and iswas required to be a minimum of 1.00 to 1.00 through the quarter ended December 31, 2017 and 1.25 to 1.00 for each quarter thereafter through the maturity of the credit facility. The final financial covenant included in the Second Amendment iswas a Minimum Liquidity covenant which callscalled for a minimum of $25,000 in undrawn availability on the revolving credit loan at all times through the quarter endingended June 30, 2018.

The Second Amendment includes several changes to certain non-financial covenants as defined in the Amended and Restated Credit Agreement. Through the maturity date of the loan, the Company is now prohibited from making any future acquisitions. The limitation on permitted annual distributions of dividends or redemptions of the Company’s stock was decreased from $4,000 to $1,700. The
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aggregate limitation on loans to and investments in non-loan parties was decreased from $10,000 to $5,000. Furthermore, the limitation on asset sales has beenwas decreased from $25,000 annually with a carryover of up to $15,000 from the prior year to $25,000 in the aggregate through the maturity date of the credit facility.


At September 30, 2017,As of March 31, 2019, L.B. Foster was in compliance with the Second Amendment’s covenants.


The Second Amendment provided for the elimination of the three lowest tiers of the pricing grid that had previously been defined in the First Amendment. Upon execution of the Second Amendment through the quarter endingended March 31, 2018, the Company will bewas locked into the highest tier of the pricing grid, which providesprovided for pricing of the prime rate plus 225 basis points on base rate loans and the applicable LIBOR rate plus 325 basis points on euro rate loans. For each quarter after March 31, 2018 and through the maturity date of the credit facility, the Company’s position on the pricing grid will beis governed by a Minimum Net Leverage ratio, which is the ratio of Consolidated Indebtedness less cash on hand in excess of $15,000 to EBITDA. If, after March 31, 2018, the Minimum Net Leverage ratio positions the Company on the lowest tier of the pricing grid, pricing will beis at the prime rate plus 150 basis points on base rate loans or the applicable LIBOR rate plus 250 basis points on euroEuro rate loans.


At September 30, 2017,As of March 31, 2019, L.B. Foster had outstanding letters of credit of approximately $425$250 and had net available borrowing capacity of $46,081.$105,361. The maturity date of the facility is March 13, 2020.


Subsequent to March 31, 2019, on April 30, 2019, the Company, its domestic subsidiaries, and certain of its Canadian and European subsidiaries (collectively, the “Borrowers”), entered into the Third Amended and Restated Credit Agreement (“Amended Credit Agreement”) with PNC Bank, N.A., Bank of America, N.A., Wells Fargo Bank, N.A., Citizens Bank, N.A., and BMO Harris Bank, N.A. This Amended Credit Agreement modifies the prior revolving credit facility which had a maximum credit line of $195,000 and extends the maturity date from March 13, 2020 to April 30, 2024. The Amended Credit Agreement provides for a five-year, revolving credit facility that permits aggregate borrowings of the Borrowers up to $140,000 with a sublimit of the equivalent of $25,000 U.S. dollars that is available to the Canadian and United Kingdom borrowers in the aggregate. The Amended Credit Agreement’s incremental loan feature permits the Company to increase the available revolving borrowings under the facility by up to an additional $50,000 and provides for additional term loan borrowings of up to $25,000 subject to the Company’s receipt of increased commitments from existing or new lenders and the satisfaction of certain conditions.

The Company’s and the domestic, Canadian, and United Kingdom guarantors’ (the “Guarantors”) obligations under the Amended Credit Agreement will be secured by the grant of a security interest by the Borrowers and Guarantors in substantially all of the personal property owned by such entities. Additionally, the equity interests in each of the loan parties, other than the Company, and the equity interests held by each loan party in their domestic subsidiaries, will be pledged to the lenders as collateral for the lending obligations.

Borrowings under the Amended Credit Agreement will bear interest at rates based upon either the base rate or Euro-rate plus applicable margins. Applicable margins are dictated by the ratio of the Company’s total net indebtedness to the Company’s consolidated EBITDA for four trailing quarters, as defined in the Amended Credit Agreement. The base rate is the highest of (a) the Overnight Bank Funding Rate plus 50 basis points, (b) the Prime Rate, or (c) the Daily Euro-rate plus 100 basis points (each as defined in the Amended Credit Agreement). The base rate and Euro-rate spreads range from 25 to 125 basis points and 125 to 225 basis points, respectively.

The Amended Credit Agreement includes three financial covenants: (a) Maximum Gross Leverage Ratio, defined as the Company’s consolidated Indebtedness divided by the Company’s consolidated EBITDA, which must not exceed (i) 3.25 to 1.00 for all testing periods other than during an Acquisition Period, and (ii) 3.50 to 1.00 for all testing periods occurring during an Acquisition Period; (b) Minimum Consolidated Fixed Charge Coverage Ratio, defined as the Company's consolidated EBITDA divided by the Company's Fixed Charges, which must be less than 1.25 to 1.00; and (c) Minimum Working Capital to Revolving Facility Usage Ratio, defined as the sum of the inventory and accounts receivable of the Borrowers and certain other Guarantors divided by Revolving Facility Usage, which must be less than 1.40 to 1.00.

The Amended Credit Agreement permits the Company to pay dividends and make distributions and redemptions with respect to its stock provided no event of default or potential default (as defined in the Amended Credit Agreement) has occurred prior to or after giving effect to the dividend, distribution, or redemption. Additionally, the Amended Credit Agreement permits the Company to complete acquisitions so long as (a) no event of default or potential default has occurred prior to or as a result of such acquisition; (b) the liquidity of the Borrowers is not less than $25,000 prior to giving effect to such acquisition; and (c) the aggregate consideration for the acquisition does not exceed: (i) $50,000 per acquisition; (ii) $50,000 in the aggregate for multiple acquisitions entered into during four consecutive quarters; and (iii) $100,000 in the aggregate over the term of the Amended Credit Agreement.

Other restrictions exist at all times including, but not limited to, limitations on the Company’s sale of assets and the incurrence by either the Borrowers or the non-borrower subsidiaries of the Company of other indebtedness, guarantees, and liens.


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United Kingdom
A subsidiary of the Company has a credit facility with NatWest Bank for its United Kingdom operations, which includes an overdraft availability of £1,500 pounds sterling (approximately $2,010 at September 30, 2017)$1,955 as of March 31, 2019). This credit facility supports the subsidiary’s working capital requirements and is collateralized by substantially all of the assets of its United Kingdom operations. The variable interest rate on this facility is the financial institution’s base rate plus 2.50%.250 basis points. Outstanding performance bonds reduce availability under this credit facility. The subsidiary of the Company had no outstanding borrowings under this credit facility at September 30, 2017.as of March 31, 2019. There was approximately $999$600 in outstanding guarantees (as defined in the underlying agreement) at September 30, 2017.as of March 31, 2019. This credit facility was renewed and amended during the fourththird quarter of 20162018 with all underlying terms and conditions remaining unchanged as a result of the renewal. It is the Company’s intention to renew this credit facility with NatWest Bank during the annual review within the forth quarter of 2017.


The United Kingdom credit facility contains certain financial covenants that require the subsidiary to maintain senior interest and cash flow coverage ratios. The subsidiary was in compliance with these financial covenants at September 30, 2017.as of March 31, 2019. The subsidiary had available borrowing capacity of $1,011 at September 30, 2017.$1,355 as of March 31, 2019.


9. FAIR VALUE MEASUREMENTSSubsequent to March 31, 2019, on April 29, 2019, the credit facility with NatWest Bank was terminated.
Note 10. Fair Value Measurements
The Company determines the fair value of assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The fair values are based on assumptions that market participants would use when pricing an asset or liability, including assumptions about risk and the risks inherent in valuation techniques and the inputs to valuations. The fair value hierarchy is based on whether the inputs to valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s own assumptions of what market participants would use. The fair value hierarchy includes three levels of inputs that may be used to measure fair value as described below:


Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.
Level 3: Unobservable inputs that are not corroborated by market data.


The classification of a financial asset or liability within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.


Cash equivalents - Included within “Cash and cash equivalents” are investments in non-domestic term deposits. The carrying amounts approximate fair value because of the short maturity of the instruments.


LIBOR-based interest rate swaps - To reduce the impact of interest rate changes on outstanding variable-rate debt, the Company entered into forward starting LIBOR-based interest rate swaps with notional values totaling $50,000. The fair value of the interest rate swaps is based on market-observable forward interest rates and represents the estimated amount that the Company would pay to terminate the agreements. As such, the swap agreements are classified as Level 2 within the fair value hierarchy. At September 30, 2017,As of March 31, 2019, the interest rate swaps were recorded within other accrued liabilities.current assets.

 Fair Value Measurements at Reporting Date and Using Fair Value Measurements at Reporting Date and UsingFair Value Measurements at Reporting DateFair Value Measurements at Reporting Date
 September 30,
2017		 Quoted Prices in Active Markets for Identical Assets
(Level  1)		 Significant Other Observable Inputs
(Level 2)		 Significant Unobservable Inputs
(Level 3)		 December 31,
2016		 Quoted Prices in Active Markets for Identical Assets
(Level  1)		 Significant Other Observable Inputs
(Level 2)		 Significant Unobservable Inputs
(Level 3)		March 31,
2019		Quoted Prices in Active Markets for Identical Assets
(Level 1)		Significant Other Observable Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)		December 31,
2018		Quoted Prices in Active Markets for Identical Assets
(Level 1)		Significant Other Observable Inputs
(Level 2)		Significant Unobservable Inputs
(Level 3)
Term deposits $17
 $17
 $—
 $—
 $16
 $16
 $—
 $—
Term deposits$16 $16 $— $— $16 $16 $— $— 
Total assets $17
 $17
 $—
 $—
 $16
 $16
 $—
 $—
Interest rate swaps $323
 $—
 $323
 $—
 $334
 $—
 $334
 $—
Interest rate swaps626 — 626 — 675 — 675 — 
Total liabilities $323
 $—
 $323
 $—
 $334
 $—
 $334
 $—
TotalTotal$642 $16 $626 $— $691 $16 $675 $— 


The interest rate swaps are accounted for as fair valuecash flow hedges and substantiallythe objective of the hedges is to offset the changes in fair valueexpected interest variability on payments associated with the interest rate of the hedged portion of the underlying debt that are attributable to the changes in market risk. Therefore, theour debt. The gains and losses related to changes in the fair value of the interest rate swaps are reclassified from “Accumulated other comprehensive loss” and included in interest income or“Interest expense - net” in our Condensed Consolidated Statements of Operations.Operations as the interest expense from our debt is recognized. For the three months ended September 30, 2017,March 31, 2019 and 2018, we recognized interest expenseincome from interest rate swaps was $98. For the nine months ended September 30, 2017,of $65 and interest expense from interest rate swaps was $302.of $35, respectively.


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In accordance with the provisions of ASC 820, "Fair“Fair Value Measurement,"” the Company measures certain nonfinancial assets and liabilities at fair value, which are recognized or disclosed on a nonrecurring basis. During the quarter ended September 30, 2017, a $413 other-than-temporary impairment charge was recorded against L B Pipe JV assets held for sale utilizing a Level 2 fair value measurement. The impairment was a result of the Company's carrying value being greater than the agreed-upon sales price, or fair market value. See
Note 7 Investments of the Notes to Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q for additional information.

10. EARNINGS PER COMMON SHARE11. Earnings Per Common Share
(Share amounts in thousands)


The following table sets forth the computation of basic and diluted earnings (loss) per common share for the periods indicated:
Three Months Ended
March 31,
20192018
Numerator for basic and diluted earnings (loss) per common share:
Net income (loss)$3,690 $(1,858)
Denominator:
Weighted average shares outstanding10,384 10,351 
Denominator for basic earnings (loss) per common share10,384 10,351 
Effect of dilutive securities:
Stock compensation plans63 — 
Dilutive potential common shares63 — 
Denominator for diluted earnings (loss) per common share - adjusted weighted average shares outstanding10,447 10,351 
Basic earnings (loss) per common share$0.36 $(0.18)
Diluted earnings (loss) per common share$0.35 $(0.18)
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
Numerator for basic and diluted earnings (loss) per common share:        
Net income (loss) $3,222
 $(5,982) $3,824
 $(100,810)
Denominator:        
Weighted average shares outstanding 10,341
 10,296
 10,332
 10,264
Denominator for basic earnings per common share 10,341
 10,296
 10,332
 10,264
Effect of dilutive securities:        
Stock compensation plans 138
 —
 103
 —
Dilutive potential common shares 138
 —
 103
 —
Denominator for diluted earnings per common share - adjusted weighted average shares outstanding and assumed conversions 10,479
 10,296
 10,435
 10,264
Basic earnings (loss) per common share $0.31
 $(0.58) $0.37
 $(9.82)
Diluted earnings (loss) per common share $0.31
 $(0.58) $0.37
 $(9.82)
Dividends paid per common share $—
 $0.04
 $—
 $0.12


There were approximately 34 and 80212 anti-dilutive shares during the three- and nine-month periodsthree months ended September 30, 2016, respectively,March 31, 2018 excluded from the above calculation.
11. STOCK-BASED COMPENSATIONNote 12. Stock-based Compensation
The Company applies the provisions of FASB ASC 718, “Compensation – Stock Compensation,” to account for the Company’s stock-based compensation. Stock-based compensation cost is measured at the grant date based on the calculated fair value of the award and is recognized over the employees’ requisite service period. The Company recorded stock compensation expense of $503 and $320 for the three-month periods ended September 30, 2017 and 2016, respectively, related to fully-vested stock awards, restricted stock awards and performance unit awards. Stock compensation expenseshare units of $1,228$855 and $875 was recorded$1,082 for the nine-month periodsthree months ended September 30, 2017March 31, 2019 and 2016,2018, respectively. At September 30, 2017,As of March 31, 2019, unrecognized compensation expense for unvested awards that the Company expects to vest approximated $4,140.$6,695. The Company will recognize this expense over the upcoming 3.54 years through March 2021.April 2023.


Shares issued as a result of vested stock-based compensation awards generally will be from previously issued shares that have been reacquired by the Company and held as treasury stock or authorized and previously unissued common stock.

During the nine months ended September 30, 2017, the Company recognized a tax deficiency of $127 related to stock-based compensation, which was fully offset by a valuation allowance, and $124 for the nine months ended September 30, 2016. Applying the prospective approach in accordance with ASU 2016-09, the change in excess income tax deficiency has been included in cash flows from operating activities for the nine months ended September 30, 2017 in the Condensed Consolidated Statements of Cash Flows.


Restricted Stock Awards and Performance Unit AwardsShare Units
Under the 2006 Omnibus Plan, the Company grants eligible employees restricted stock and performance unit awards.share units. The forfeitable restricted stock awards granted prior to March 2015 generally time-vest after a four-year period, and those granted subsequent to March 2015 generally time-vest ratably over a three-yearthree-year period, unless indicated otherwise by the underlying restricted stock agreement. Since May 2018, awards of restricted stock are subject to a minimum one-year vesting period, including those granted to non-employee directors. Prior to May 2018, awards to non-employee directors were made in fully-vested shares. Performance unit awardsshare units are offered annually under separate three-yearthree-year long-term incentive programs. Performance share units are subject to forfeiture and will be converted into common stock of the Company based upon the Company’s performance relative to performance measures and conversion multiples, as defined in the underlying program. If the Company’s estimate of the number of performance stock awardsshare units expected to vest changes in a subsequent accounting period, cumulative compensation expense could increase or decrease. The change will be recognized in the current period for the vested shares and would change future expense over the remaining vesting period.


During the quarter ended June 30,Since May 1, 2017, the Nomination and Governance Committee and Board of Directors jointly approved the Deferred Compensation Plan for Non-Employee Directors under the 2006 Omnibus Incentive Plan, which permits Non-Employee Directors of the Companynon-employee directors have been permitted to defer receipt of earnedannual stock awards and equity elected to be received in lieu of quarterly cash and/orcompensation. If so elected, these deferred stock compensation forunits will be issued as common stock six months after separation from their service on the Board. Board of Directors. Since May 2018, there have been no non-employee directors who elected the option to receive deferred stock units of the Company’s common stock in lieu of director cash compensation.

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During the quarterthree months ended March 31, 2017,2019, the Compensation Committee approved the 20172019 Performance Share Unit Program and the Executive Annual Incentive Compensation Plan (consisting of cash and equity components). The Compensation Committee also certified the actual performance achievement of participants in the 20142016 Performance Share Unit Program. Actual performance resulted in no payout relative to the 20142016 Performance Share Unit Program target performance metrics.


The following table summarizes the restricted stock award,awards, deferred stock award,units, and performance unit awardshare units activity for the periodthree months ended September 30, 2017:March 31, 2019:
Restricted
Stock		Deferred
Stock Units		Performance
Share Units		Weighted Average
Grant Date Fair Value
Outstanding as of December 31, 2018191,825 41,774 300,373 $18.61 
Granted52,897 — 89,092 17.76 
Vested(67,788)— — 15.22 
Adjustment for incentive awards not expected to vest— — (17,936)17.76 
Outstanding as of March 31, 2019176,934 41,774 371,529 $19.03 

  Restricted
Stock		 Deferred
Stock		 Performance
Stock Units		 Weighted Average
Grant Date Fair Value
Outstanding at December 31, 2016 79,272
 —
 63,690
 $21.66
Granted 170,196
 24,927
 120,583
 14.24
Vested (22,808) —
 —
 28.88
Adjustment for incentive awards expected to vest —
 —
 53,385
 18.33
Cancelled (44,854) —
 (49,062) 15.40
Outstanding at September 30, 2017 181,806
 24,927
 188,596
 $16.48
12. RETIREMENT PLANSNote 13. Retirement Plans
Retirement Plans
The Company has seventhree retirement plans that cover its hourly and salaried employees in the United States: threeone defined benefit plans, all ofplan, which areis frozen, and fourtwo defined contribution plans. Employees are eligible to participate in the appropriate plan based on employment classification. The Company’s contributions to the defined benefit and defined contribution plans are governed by the Employee Retirement Income Security Act of 1974 (“ERISA”) and the Company’s policy and investment guidelines applicable to each respective plan. The Company’s policy is to contribute at least the minimum in accordance with the funding standards of ERISA.


The Company’s subsidiary, L.B. Foster Rail Technologies, Inc. (“Rail Technologies”),Company maintains two defined contribution plans for its employees in Canada, as well as aone post-retirement benefit plan. In the United Kingdom, Rail TechnologiesThe Company also maintains two defined contribution plans and aone defined benefit plan.plan for its employees in the United Kingdom.


United States Defined Benefit PlansPlan
Net periodic pension costs for the United States defined benefit pension plansplan for the three-three months ended March 31, 2019 and nine-month periods ended September 30, 2017 and 2016 are2018 were as follows:
Three Months Ended
March 31,
20192018
Interest cost$162 $155 
Expected return on plan assets(180)(213)
Recognized net actuarial loss31 24 
Net periodic pension cost (income)$13 $(34)
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
Service cost $—
 $9
 $—
 $27
Interest cost 171
 186
 513
 559
Expected return on plan assets (178) (179) (533) (538)
Recognized net actuarial loss 33
 69
 98
 207
Net periodic pension cost $26
 $85
 $78
 $255


The Company does not expect to contributeanticipates contributions of $550 to its United States defined benefit planspension plan in 2017.2019.


United Kingdom Defined Benefit PlansPlan
Net periodic pension costs for the United Kingdom defined benefit pension plan for the three-three months ended March 31, 2019 and nine-month periods ended September 30, 2017 and 2016 are2018 were as follows:
Three Months Ended
March 31,
20192018
Interest cost$54 $53 
Expected return on plan assets(62)(72)
Amortization of prior service costs and transition amount11 5 
Recognized net actuarial loss53 49 
Net periodic pension cost$56 $35 

18
  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
Interest cost $56
 $73
 $168
 $223
Expected return on plan assets (67) (82) (201) (250)
Amortization of prior service costs and transition amount 4
 5
 12
 15
Recognized net actuarial loss 72
 38
 216
 116
Net periodic pension cost $65
 $34
 $195
 $104
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United Kingdom regulations require trustees to adopt a prudent approach to funding required contributions to defined benefit pension plans. EmployerThe Company anticipates contributions of approximately $251 are anticipated$255 to the United Kingdom Rail Technologies pension plan during 2017.2019. For the ninethree months ended September 30, 2017,March 31, 2019, the Company contributed approximately $188$64 to the plan.


Defined Contribution Plans
The Company sponsors eightsix defined contribution plans for hourly and salaried employees across our domestic and international facilities. The following table summarizes the expense associated with the contributions made to these plans.plans:
Three Months Ended
March 31,
20192018
United States$550 $544 
Canada38 33 
United Kingdom107 117 
$695 $694 

  Three Months Ended
September 30,		 Nine Months Ended
September 30,
  2017 2016 2017 2016
United States $415
 $152
 $1,276
 $1,289
Canada 53
 46
 167
 164
United Kingdom 93
 64
 306
 281
  $561
 $262
 $1,749
 $1,734
13. COMMITMENTS AND CONTINGENT LIABILITIESNote 14. Commitments and Contingent Liabilities
Product Liability Claims
The Company is subject to product warranty claims that arise in the ordinary course of its business. For certain manufactured products, the Company maintains a product warranty accrual which is adjusted on a monthly basis as a percentage of cost of sales. TheIn addition, the product warranty accrual is adjusted periodically adjusted based on the identification or resolution of known individual product warranty claims.


The following table sets forth the Company’s product warranty accrual:
Warranty Liability
Balance as of December 31, 2018$2,057 
Additions to warranty liability255 
Warranty liability utilized(597)
Balance as of March 31, 2019$1,715 
 Warranty Liability
Balance at December 31, 2016$10,154
Additions to warranty liability3,203
Warranty liability utilized(3,743)
Balance at September 30, 2017$9,614

Included within the above table are concrete tie warranty reserves of approximately $7,607 and $7,574 at September 30, 2017 and December 31, 2016, respectively.


Union Pacific Railroad (UPRR)(“UPRR”) Concrete Tie Matter
On July 12, 2011, UPRR notified (the “UPRR Notice”)March 13, 2019, the Company and its subsidiary, CXT Incorporated (“CXT”), ofentered into a warranty claim under CXT’s 2005 supply contract relating to the sale of pre-stressed concrete railroad ties to UPRR. UPRR asserted that a significant percentage of concrete ties manufactured in 2006 through 2011 at CXT’s Grand Island, NE facility failed to meet contract specifications, had workmanship defects and were cracking and failing prematurely. Of the 3 million ties manufactured between 1998 and 2011 from the Grand Island, NE facility, approximately 1.6 million ties were sold during the period UPRR had claimed nonconformance.The 2005 contract called for each concrete tie which failed to conform to the specifications or had a material defect in workmanship to be replaced with 1.5 new concrete ties, provided, that, within five years of the sale of a concrete tie, UPRR notified CXT of such failure to conform or such defect in workmanship.
The UPRR Notice did not specify how many ties manufactured during this period were defective nor the exact nature of the alleged workmanship defect.

Following the UPRR Notice, the Company worked with material scientists and pre-stressed concrete experts to test a representative sample of Grand Island, NE concrete ties and assess warranty claims for certain concrete ties made in its Grand Island, NE facility between 1998 and 2011. The Company discontinued manufacturing operations in Grand Island, NE in early 2011.

2012
During 2012, the Company completed sufficient testing and analysis to further understand this matter. Based upon testing results and expert analysis, the Company believed it discovered conditions, which largely related to the 2006 to 2007 manufacturing period, that can shorten the life of the concrete ties produced during this period. During the fourth quarter of 2012 and first quarter of 2013, the Company reached agreement with UPRR on several matters including a tie rating process for the Company and UPRR to work together to identify, prioritize, and replace defective ties that meet the criteria for replacement. This process applies to the ties the Company shipped to UPRR from its Grand Island, NE facility from 1998 to 2011. During most of this period, the Company’s warranty policy for UPRR carried a 5-year warranty with a 1.5:1 replacement ratio for any defective ties. In order to accommodate UPRR and other customer concerns, the Company also reverted to a previously used warranty policy providing a 15-year warranty with a 1:1 replacement ratio. This change provided an additional 10 years of warranty protection. In the amended 2005 supply agreement, the Company and UPRR also extended the supply of Tucson ties by five years and agreed on a cash payment of $12,000 to UPRR as compensation for concrete ties already replaced by UPRR during the investigation period.

During 2012, as a result of the testing that the Company conducted on concrete ties manufactured at its former Grand Island, NE facility and the developments related to UPRR and other customer matters, the Company recorded pre-tax warranty charges of $22,000 in “Cost of Goods Sold” within its Rail Products and Services segment based on the Company’s estimate of the number of defective concrete ties that will ultimately require replacement during the applicable warranty periods.

2013
Throughout 2013, at UPRR’s request and under the terms of the amended 2005 supply agreement, the Company provided warranty replacement concrete ties for use across certain UPRR subdivisions. The Company attempted to reconcile the quantity of warranty claims for ties replaced and obtain supporting detail for the ties removed. The Company believes that UPRR did not replace concrete ties in accordance with the amended agreement and has not furnished adequate documentation throughout the replacement process in these subdivisions to support its full warranty claim. Based on the information received by the Company to date, the Company believes that a significant number of ties which UPRR replaced in these subdivisions did not meet the criteria to be covered as warranty replacement ties under the amended 2005 supply agreement. The disagreement related to the 2013 warranty replacement activity includes approximately 170,000 ties where the Company provided detailed documentation supporting our position with reason codes that detail why these ties are not eligible for a warranty claim.

In late November 2013, the Company received notice from UPRR asserting a material breach of the amended 2005 supply agreement. UPRR’s notice asserted that the failure to honor its claims for warranty ties in these subdivisions was a material breach. Following receipt of this notice, the Company provided information to UPRR to refute UPRR’s claim of breach and included the reconciliation of warranty claims supported by substantial findings from the Company’s track observation team, all within the 90-day cure period. The Company also proposed further discussions to reach agreement on reconciliation for 2013 replacement activities and future replacement activities and a recommended process that will ensure future replacement activities are done with appropriate documentation and per the terms of the amended 2005 supply agreement.

2014
During the first quarter of 2014, the Company further responded within the 90-day cure period to UPRR’s claim and presented a reconciliation for the subdivisions at issue. This proposed reconciliation was based on empirical data and visual observation from Company employees that were present during the replacement process for a substantial majority of the concrete ties replaced. The Company spent considerable time documenting facts related to concrete tie condition and track condition to assess whether the ties replaced met the criteria to be eligible for replacement under the terms of the amended 2005 supply agreement.

During 2014, the Company increased its accrual by an additional $8,766 based on revised estimates of ties to be replaced based upon scientific testing and other analysis, adjusted for ties already provided to UPRR. The Company continued to workSettlement Agreement (the “Settlement Agreement”) with UPRR to identify, replace, and reconcile defective ties related toresolve the warranty claimpending litigation in accordance with the amended 2005 supply agreement. Thematter of Union Pacific Railroad Company v. L.B. Foster Company and UPRR met during the third quarter of 2014 to evaluate each other’s position in an effort to work towards agreement on the unreconciled 2013 and 2014 replacement activity as well as the standards and practices to be implemented for future replacement activity and warranty tie replacement.

In November and December of 2014, the Company received additional notices from UPRR asserting that ties manufactured in 2000 were defective and again asserting material breaches of the amended 2005 supply agreement relating to warranty tie replacements as well as certain new ties provided to UPRR being out of specification.

At December 31, 2014, the Company and UPRR had not been able to reconcile the disagreement related to the 2013 and 2014 warranty replacement activity. The disagreement relating to the 2014 warranty replacement activity includes approximately 90,100 ties that the Company believes are not warranty-eligible.

2015
On January 23, 2015, UPRR filed a Complaint and Demand for Jury TrialCXT Incorporated, Case No. CI 15-564, in the District Court for Douglas County, NE (“Complaint”) againstNebraska.

Under the Settlement Agreement, the Company and CXT will pay UPRR the aggregate amount of $50,000 without pre-judgment interest, which began with a $2,000 immediate payment, and with the remaining $48,000 paid in installments over a six-year period commencing on the effective date of the Settlement Agreement through December 2024 pursuant to a Promissory Note. Additionally, commencing in January 2019 and through December 2024, UPRR agreed to purchase from the Company and its subsidiary, CXT, asserting, among other matters, that the Company breached its express warranty, breached an implied covenantsubsidiaries and affiliates, a cumulative total amount of good faith$48,000 of products and fair dealing, and anticipatorily repudiated its warranty obligations, and that UPRR’s exclusive and limited remedy provisionsservices, targeting $8,000 of annual purchases per year beginning in the supply agreement have failed2019 per letters of their essential purpose which entitles UPRR to recover all incidental and consequential damages. The Complaint seeks to cancel all duties of UPRRintent under the contract, to adjudge the Company as having no remaining rights under the contracts, and to recover damages in an amount to be determined at trial for the value of unfulfilled warranty replacement ties and ties likely to become warranty eligible, for costs of cover for replacement ties, and for various incidental and consequential damages.Settlement Agreement. The amended 2005 supply agreement provides that UPRR’s exclusive remedy is to receiveSettlement Agreement also includes a replacement tie that meets the contract specifications for each tie that failed to meet the contract specifications or otherwise contained a material defect provided that the Company receives written notice of such failure or defect within 15 years after that tie was produced. The amended 2005 supply agreement provides that the Company’s warranty does not apply to ties that (a) have been repaired or altered without the Company’s written consent in such a way as to affect the stability or reliability thereof, (b) have been subject to misuse, negligence, or accident, or (c) have been improperly maintained or used contrary to the specifications for which such ties were produced. The amended 2005 supply agreement also continues to provide that the Company’s warranty is in lieumutual release of all other expressclaims and liability regarding or implied warranties and that neither party shall be subject to or liable for any incidental or consequential damages to the other party. The dispute is largely based on (1) claims submitted that the Company believes are for ties claimed for warranty replacement that are inaccurately rated under concrete tie rating guidelines and procedures agreed to in 2012 and incorporated by amendment to the 2005 supply agreement rated and are not the responsibility of the Company and claims that do not meet the criteria of a warranty replacement and (2) UPRR’s assertion, which the Company vigorously disputes, that UPRR in future years will be entitled to warranty replacement ties for virtually all of the Grand Island ties. Many thousands of Grand Island ties have been performing in track for over ten years. In addition, a significant amount of Grand Island ties were rated by both parties in the excellent category of the rating system.

In June 2015, UPRR delivered an additional notice alleging deficiencies in certain ties produced in the Company’s Tucson and Spokane locations and other claimed material breaches which the Company contends are unfounded. The Company again responded to UPRR that it was not in material breach of the amended 2005 supply agreement relating to warranty tie replacementsall CXT pre-stressed concrete railroad ties with no admission of liability and that the ties in question complied with the specifications provided by UPRR.

On June 16 and 17, 2015, UPRR issued a formal notice of the termination of the concrete tie supply agreement as well as the termination of the lease agreement at the Tucson, AZ production facility and rejection and revocation of its prior acceptance of certain ties manufactured at the Company’s Spokane, WA production facility. Since that time, UPRR has discontinued submitting purchase orders to the Company for shipment of warranty replacement ties.

On May 29, 2015, the Company and CXT filed an Answer, Affirmative Defenses and Counterclaims in response to the Complaint, denying liability to UPRR. As a result of UPRR’s subsequent June 16-17, 2015 actions and certain related conduct, the Company on October 5, 2015 amended the pending Answer, Affirmative Defenses and Counterclaims to add, among other things, assertions that UPRR’s conduct in question was wrongful and unjustified and constituted additional grounds for the affirmative defenses to UPRR’s claims and also for the Company’s counterclaims.

2016
By Scheduling Order dated June 29, 2016, an August 31, 2017 deadline for the completion of fact discovery was established with trial to proceed at some future date after October 30, 2017, and UPRR filed an amended notice of trial to commence on October 30, 2017.

2017
By Third Amended Scheduling Order dated September 26, 2017, a June 29, 2018 deadline for completion of discovery has been established with trial to proceed at some future date on or after October 1, 2018. During the first nine months ended September 30, 2017, the parties continued to conduct discovery, with various disputes that required and will likely require court resolution. The Company intends to continue to engage in discussions in an effort to resolve the UPRR matter. However, we cannot predict that such discussions will be successful, or that the resultsdismissal of the litigation with prejudice.

The expected payments under the UPRR or any settlement or judgment amounts, will reasonably approximate our estimated accrualsSettlement Agreement for loss contingencies. Future potential costs pertaining to UPRR’s claims and the outcomeremainder of the UPRR litigation could result in a material adverse effect on our resultsyear ending December 31, 2019 and thereafter are as follows:
Year Ending December 31,
Remainder of 2019$8,000 
20208,000 
20218,000 
20228,000 
20238,000 
20248,000 
Total$48,000 

19
Table of operations, financial condition, and cash flows.Contents

As a result of the preliminary status of the litigation and the uncertainty of any potential judgment, an estimate of any additional loss, or a range of additional loss, associated with this litigation cannot be made based upon currently available information.

Environmental and Legal Proceedings
The Company is subject to national, state, foreign, provincial, and/or local laws and regulations relating to the protection of the environment. The Company’s efforts to comply with environmental regulations may have an adverse effect on its future earnings. On June 5, 2017, a General Notice Letter was received from the United States Environmental Protection Agency ("EPA"(“EPA”) indicating that the Company may be a potentially responsible party (“PRP”) regarding the Portland Harbor Superfund Site cleanup along with numerous other companies. By letter dated March 16, 2018, the EPA informed the Company of the proposed schedule for consent decree negotiations to implement the Portland Harbor Superfund Site Record of Decision, with negotiations scheduled to commence by the end of 2019. By letter dated December 17, 2018, the EPA requested that PRPs submit written proposals to perform remedial designs by January 31, 2019 with the expectation that all negotiations for remedial design work will be finalized by June 2019. The net present value and undiscovered costs of the selected remedy are estimated by the EPA to be approximately $1,100,000 and $1,700,000, respectively. The Company is reviewing the basis for its identification by the EPA and the nature of the historic operations of an L.B. Foster predecessor on the site. Management does not believe that compliance with the present environmental protection laws will have a material adverse effect on the financial condition, results of operations, cash flows, competitive position, or capital expenditures of the Company.


At September 30, 2017As of March 31, 2019 and December 31, 2016,2018, the Company maintained environmental reserves approximating $6,255$6,110 and $6,270,$6,128, respectively. The following table sets forth the Company’s environmental obligation:
Environmental liability
Balance as of December 31, 2018$6,128 
Additions to environmental obligations2 
Environmental obligations utilized(20)
Balance as of March 31, 2019$6,110 
 Environmental liability
Balance at December 31, 2016$6,270
Additions to environmental obligations7
Environmental obligations utilized(22)
Balance at September 30, 2017$6,255


The Company is also subject to other legal proceedings and claims that arise in the ordinary course of its business. Legal actions are subject to inherent uncertainties, and future events could change management's assessment of the probability or estimated amount of potential losses from pending or threatened legal actions. Based on available information, it is the opinion of management that the ultimate resolution of pending or threatened legal actions, both individually and in the aggregate, will not result in losses having a material adverse effect on the Company's financial position or liquidity at September 30, 2017.as of March 31, 2019.


If management believes that, based on available information, it is at least reasonably possible that a material loss (or additional material loss in excess of any accrual) will be incurred in connection with any legal actions, the Company discloses an estimate of the possible loss or range of loss, either individually or in the aggregate, as appropriate, if such an estimate can be made, or discloses that an estimate cannot be made. Based on the Company's assessment at September 30, 2017,as of March 31, 2019, no such disclosures were considered necessary.


14. INCOME TAXESNote 15. Income Taxes
For the three months ended September 30, 2017March 31, 2019 and 2016,2018, the Company recorded an income tax benefitprovision of $208$638 and $525 on pretaxpre-tax income of $3,014$4,328 and $3,379 on pretax lossespre-tax loss of $9,361,$1,333, respectively, for an effective income tax rate of (6.9)%14.7% and 36.1%, respectively. For the nine months ended September 30, 2017 and 2016, the Company recorded an income tax provision of $698 on pretax income of $4,522 and an income tax benefit of $42,125 on pretax losses of $142,935, respectively, for an effective income tax rate of 15.4% and 29.5%(39.4)%, respectively. The Company’s tax provision for the nine months ended September 30, 2017 is primarily comprised of taxes on our Canadian and United Kingdom operations. However, as a result of the U.S. consolidated group's current year income, the Company's estimated annual effective tax rate was adjusted duringfor the third quarterthree months ended March 31, 2019 differed from the federal statutory rate of 21% primarily due to include the realization of a portion of its U.S. deferred tax assets previously offset by a valuation allowance. The Company continued to maintain a full valuation allowance against its U.S. deferred tax assets, which is likely to result in significant variability of the effective tax rate in the current year. Changes in pretaxpre-tax income projections and the mix of income across jurisdictions could also impact the effective income tax rate.
15. SUBSEQUENT EVENTS
Management evaluated all
20
Table of the activity of the Company and concluded that no subsequent events have occurred that would require recognition in the Condensed Consolidated Financial Statements or disclosure in the Notes to Condensed Consolidated Financial Statements.Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
(Dollars in thousands, except share data)
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended. Many of the forward-looking statements are located in “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”Operations” (“MD&A”). Forward-looking statements provide management's current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Sentences containing words such as “believe,” “intend,” “plan,” “may,” “expect,” “should,” “could,” “anticipate,” “estimate,” “predict,” “project,” or their negatives, or other similar expressions of a future or forward-looking nature generally should be considered forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q are based on current expectations and assumptions about future events that involve inherent risks and uncertainties and may concern, among other things, L.B. Foster Company’s (the “Company”“Company’s”) expectations relating to our strategy, goals, projections, and plans regarding our financial position, liquidity, capital resources, and results of operations; the outcome of litigation and product warranty claims; decisions regarding our strategic growth initiatives, market position, and product development; all of which are based on current estimates that involve inherent risks and uncertainties. The Company has based these forward-looking statements on current expectations and assumptions about future events.development. While the Company considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory, and other risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control. The Company cautions readers that various factors could cause the actual results of the Company to differ materially from those indicated by forward-looking statements. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Among the factors that could cause the actual results to differ materially from those indicated in the forward-looking statements are risks and uncertainties related to: environmental matters, including any costs associated with any remediation and monitoring; a resumption of the economic slowdown we have experienced in the previous two years in the markets we serve; the risk of doing business in international markets; our ability to effectuate our strategy, including cost reduction initiatives, and our ability to effectively integrate acquired businesses and realize anticipated benefits; costs of and impacts associated with shareholder activism; a decrease in freight or passenger rail traffic; the timeliness and availability of materials from our major suppliers as well as the impact on our access to supplies of customer preferences as to the origin of such supplies, such as customers' concerns about conflict minerals; labor disputes; the continuing effective implementation of an enterprise resource planning system; changes in current accounting estimates and their ultimate outcomes; the adequacy of internal and external sources of funds to meet financing needs, including our ability to negotiate any additional necessary amendments to our credit agreement;agreement or the terms of a new credit agreement, and reforms regarding the use of LIBOR as a benchmark for establishing applicable interest rates; the Company’s ability to manage its working capital requirements and indebtedness; domestic and international taxes, including estimates that may impact these amounts; foreign currency fluctuations; inflation; domestic and foreign government regulations;regulations, including tariffs; economic conditions and regulatory changes caused by the United Kingdom’s pending exit from the European Union;Union, including the possibility of a “no-deal Brexit;” sustained declines in energy prices; a lack of state or federal funding for new infrastructure projects; an increase in manufacturing or material costs; the ultimate number of concrete ties that will have to be replaced pursuant to the previously disclosed product warranty claim of the Union Pacific Railroad (“UPRR”) and an overall resolution of the related contract claims as well as the possible costs associated with the outcome of the lawsuit filed by the UPRR; the loss of future revenues from current customers; and risks inherent in litigation. Should one or more of these risks or uncertainties materialize, or should the assumptions underlying the forward-looking statements prove incorrect, actual outcomes could vary materially from those indicated. Significant risks and uncertainties that may affect the operations, performance, and results of the Company’s business and forward-looking statements include, but are not limited to, those set forth under Item 1A, “Risk Factors,” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2018, or as updated and amended by Item 1A “Risk Factors,” in Part II of our other periodic filingsQuarterly Reports on Form 10-Q filed with the Securities and Exchange Commission.


The forward-looking statements in this report are made as of the date of this report and we assume no obligation to update or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by the federal securities laws.


General Overview
L.B. Foster Company (the “Company”) is a leading manufacturer and distributor of products and services for the transportation and energy infrastructure with locations in North America and Europe. The Company is comprised of three businessoperating segments: Rail Products and Services, Construction Products, and Tubular and Energy Services.


Quarter-to-Date Results
The segment gross profit measures presented within Management's Discussion and Analysis
21
Table of Financial Condition and Contents
Results of Operations ("MD&A") tables constitute non-GAAP financial measures disclosed by management to provide investors and other users information to evaluate the performanceQuarter
Three Months Ended
March 31,		Percent
Increase/
(Decrease)		Percent of Total Net Sales
Three Months Ended
March 31,
201920182019 vs. 201820192018
Net Sales:
Rail Products and Services$75,694 $62,170 21.8 %50.3 %50.8 %
Construction Products37,345 28,900 29.2  24.8  23.6  
Tubular and Energy Services37,430 31,384 19.3  24.9  25.6  
Total net sales$150,469 $122,454 22.9 %100.0 %100.0 %
Three Months Ended
March 31,		Percent
Increase/
(Decrease)		Gross Profit Percentage
Three Months Ended
March 31,
201920182019 vs. 201820192018
Gross Profit:
Rail Products and Services$14,237 $11,924 19.4 %18.8 %19.2 %
Construction Products5,572 4,032 38.2  14.9  14.0  
Tubular and Energy Services9,353 6,236 50.0  25.0  19.9  
Total gross profit$29,162 $22,192 31.4 %19.4 %18.1 %
Three Months Ended
March 31,		Percent
Increase/
(Decrease)		Percent of Total Net Sales
Three Months Ended
March 31,
201920182019 vs. 201820192018
Expenses:
Selling and administrative expenses$21,917 $20,458 7.1 %14.6 %16.7 %
Amortization expense1,712 1,785 (4.1) 1.1  1.5  
Interest expense - net1,355 1,887 (28.2) 0.9  1.5  
Other income(150)(605)75.2  (0.1) (0.5) 
Total expenses$24,834 $23,525 5.6 %16.5 %19.2 %
Income (loss) before income taxes$4,328 $(1,333)**  2.9 %(1.1)%
Income tax expense638 525 21.5  0.4  0.4  
Net income (loss)$3,690 $(1,858)**  2.5 %(1.5)%

** Results of the Company’s segments on a more comparable basis to market trends and peers. The exclusion of significant cost allocations to the reportable segments:calculation are not considered meaningful for presentation purposes.


Allows users to understand the operational performance of our reportable segments;
Provides greater comparability to other registrants with similar businesses and avoids possible non-comparability at the reportable segment pre-tax profit level resulting from our specific corporate cost allocations; and
Facilitates a clearer, market-based perspective on the strength or weakness of our reportable segments in their markets to better aid in investment decisions.

In addition, these non-GAAP financial measures have historically been key metrics utilized by segment managers to monitor selling prices and quantities as well as production and service costs to better evaluate key profitability drivers and trends that may develop due to industry and competitive conditions.
Three months ended September 30, 2017 Rail Products and
Services		 Construction
Products		 Tubular and Energy
Services		 Total
Reportable Segment Profit $3,472
 $3,387
 $2,298
 $9,157
Segment and Allocated Selling & Administrative 9,405
 4,620
 3,337
 17,362
Amortization Expense 940
 38
 786
 1,764
Asset Impairments —
 —
 —
 —
Non-GAAP Segment Gross Profit $13,817
 $8,045
 $6,421
 $28,283
         
Three months ended September 30, 2016 Rail Products and
Services		 Construction
Products		 Tubular and Energy
Services		 Total
Reportable Segment (Loss) Profit $(2,047) $1,356
 $(6,966) $(7,657)
Segment and Allocated Selling & Administrative 8,926
 4,783
 4,290
 17,999
Amortization Expense 958
 38
 767
 1,763
Asset Impairments 4,383
 —
 2,563
 6,946
Non-GAAP Segment Gross Profit $12,220
 $6,177
 $654
 $19,051

      Percent of Total Net Sales  
  Three Months Ended Three Months Ended Percent
Increase/
(Decrease)
  September 30, September 30, 
  
 2017 2016 2017 2016 2017 vs. 2016
Net Sales:          
Rail Products and Services $62,095
 $56,891
 47.2 % 49.6 % 9.1 %
Construction Products 39,118
 34,870
 29.7
 30.4
 12.2
Tubular and Energy Services 30,279
 22,883
 23.1
 20.0
 32.3
Total net sales $131,492
 $114,644
 100.0 % 100.0 % 14.7 %
           
      Non-GAAP / Reported
Gross Profit Percentage		 Percent
Increase/
(Decrease)
  Three Months Ended Three Months Ended 
  September 30, September 30, 
  
 2017 2016 2017 2016 2017 vs. 2016
Gross Profit:          
Non-GAAP Rail Products and Services $13,817
 $12,220
 22.3 % 21.5 % 13.1 %
Non-GAAP Construction Products 8,045
 6,177
 20.6
 17.7
 30.2
Non-GAAP Tubular and Energy Services 6,421
 654
 21.2
 2.9
 **
Non-GAAP Segment gross profit 28,283
 19,051
      
LIFO (expense) income (1,552) 917
 (1.2) 0.8
 **
Other (366) (165) (0.3) (0.1) 121.8
Total gross profit $26,365
 $19,803
 20.1 % 17.3 % 33.1 %
        Percent
Increase/
(Decrease)
      Percent of Total Net Sales 
  Three Months Ended Three Months Ended 
  September 30, September 30, 
  2017 2016 2017 2016 2017 vs. 2016
Expenses:          
Selling and administrative expenses $20,218
 $19,807
 15.4 % 17.3 % 2.1 %
Amortization expense 1,764
 1,763
 1.3
 1.5
 0.1
Asset impairments —
 6,946
 —
 6.1
 (100.0)
Interest expense 2,026
 1,520
 1.5
 1.3
 33.3
Interest income (56) (50) —
 —
 12.0
Equity in (income) loss of nonconsolidated investments (50) 263
 —
 0.2
 (119.0)
Other income (551) (1,085) (0.4) (0.9) 49.2
Total expenses $23,351
 $29,164
 17.8 % 25.4 % (19.9)%
Income (loss) before income taxes $3,014
 $(9,361) 2.3 % (8.2)% 132.2 %
Income tax benefit (208) (3,379) (0.2) (2.9) 93.8
Net income (loss) $3,222
 $(5,982) 2.5 % (5.2)% 153.9 %
**Results of calculation are not considered meaningful for presentation purposes.

ThirdFirst Quarter 20172019 Compared to ThirdFirst Quarter 20162018 – Company Analysis
Net sales of $131,492$150,469 for the periodthree months ended September 30, 2017March 31, 2019 increased by $16,848,$28,015, or 14.7%22.9%, compared to the prior year quarter. The change was attributable to increases within each of 32.3%our three segments. Construction Products sales increased by 29.2%, 12.2%Rail Products and Services sales increased by 21.8%, and 9.1%, in Tubular and Energy Services Construction Products, and Rail Products and Services, respectively.sales increased by 19.3%.


Gross profit increased $6,970 compared to the prior year quarter to $29,162 for the three months ended March 31, 2019. Gross profit margin for the quarterthree months ended September 30, 2017March 31, 2019 was 20.1%19.4%, or 280130 basis points (“bps”) higher than the prior year quarter. EachThe rise in gross profit margin was primarily due to increases of the three segments contributed to the increase with gains of 1,830 bps, 290510 bps and 8090 bps inwithin Tubular and Energy Services and Construction Products, andrespectively. The increases were partially offset by a decrease in gross profit margin of 40 bps within Rail Products and Services, respectively.Services.


Selling and administrative expenses increased by $411$1,459 or 2.1%7.1% from the prior year. The increaseescalation was primarily driven by personnel related spendingincreases in personnel-related expenses of $821, which was partially offset by reduced litigation costs related$1,494. As a percent of sales, selling and administrative expenses declined 210 bps compared to the Union Pacific Railroad ("UPRR") matter of $468.prior year period.

During the quarter ended September 30, 2016, the Company recorded total non-cash asset impairments of $6,946 from goodwill and definite-lived intangible assets.


Interest expense, net of interest income, increaseddecreased by $500,$532, or 34.0%28.2%, as a result of the increasereduction in outstanding debt compared to the prior year quarter as well as an interest rates on outstanding debt.rate at the lowest tier within the interest rate spread under our credit facility agreement. Other
22
Table of Contents
income decreased $534, or 49.2%,$455, which primarily relates to foreign exchange losses in the 2019 period compared to gains on foreign exchange asin the Canadian Dollar has strengthened compared to the United States Dollar versus the prior year2018 period.


The Company’s effective income tax rate for the three-month periodthree months ended September 30, 2017March 31, 2019 was (6.9)%14.7%, compared to 36.1%(39.4)% in the prior year quarter. For the three months ended September 30, 2017,March 31, 2019, the Company recorded a tax benefitprovision of $208,$638, compared to $3,379$525 in the three months ended September 30, 2016.March 31, 2018. The Company's incomeeffective tax benefitrate for the three months ended September 30, 2017 wasMarch 31, 2019 differed from the federal statutory rate of 21% primarily relateddue to changes in our estimated annual effective tax rate. The Company continued to maintainthe realization of a full valuation allowance againstportion of its U.S. deferred tax assets.assets previously offset by a valuation allowance.


Net income for the thirdfirst quarter of 20172019 was $3,222,$3,690, or $0.31$0.35 per diluted share, compared to a net loss of $5,982,$1,858, or $0.58$0.18 loss per diluted share, in the prior year quarter. The following table provides a reconciliation of the GAAP earnings per share value to the non-GAAP adjusted earnings1 per share value for the three-month periods ended September 30, 2017 and 2016:
  Three Months Ended
September 30,
  2017 2016
  (Unaudited)
Adjusted Diluted Earnings (Loss) Per Share Reconciliation    
Net income (loss), as reported $3,222
 $(5,982)
Asset impairments, net of tax benefits of $1,000 —
 5,946
Adjusted net income (loss) $3,222
 $(36)
Average number of common shares outstanding - Diluted 10,479
 10,296
Diluted earnings (loss) per common share, as reported $0.31
 $(0.58)
Diluted earnings (loss) per common share, as adjusted $0.31
 $(0.00)

1 All results in this Quarterly Report that exclude asset impairment charges are non-GAAP measures used for management reporting purposes. Management believes that these measures provide useful information to investors because they will assist investors in evaluating earnings performance on a comparable year-over-year basis.


Results of Operations – Segment Analysis
Rail Products and Services
Three Months Ended
March 31,		Increase/(Decrease)Percent
Increase/(Decrease)
201920182019 vs. 20182019 vs. 2018
Net sales$75,694 $62,170 $13,524 21.8 %
Gross profit$14,237 $11,924 $2,313 19.4 %
Gross profit percentage18.8 %19.2 %(0.4)%(1.9)%
Segment profit$3,479 $2,048 $1,431 69.9 %
Segment profit percentage4.6 %3.3 %1.3 %39.5 %
  Three Months Ended
September 30,		 Increase Percent
Increase
  2017 2016 2017 vs. 2016 2017 vs. 2016
Net Sales $62,095
 $56,891
 $5,204
 9.1%
Segment Profit (Loss) $3,472
 $(2,047) $5,519
 269.6%
Segment Profit (Loss) Percentage 5.6% (3.6)% 9.2% 255.6%


ThirdFirst Quarter 20172019 Compared to ThirdFirst Quarter 20162018
The Rail Products and Services segment sales increased by $5,204,$13,524, or 9.1%21.8%, compared to the prior year period. The sales increase was primarily driven domestically by a $3,037 increase inboth our distribution business, which experienced increased demand as overall tonnage sold increased compared to the prior period, and Allegheny Rail Products which increased by $2,017, following a 76% demand increase from Class 1 railroads.and Rail Technologies businesses of $10,172 and $3,352, respectively. The Rail Products growth was primarily attributable to North American new rail distribution volume. The segment also continued to capitalize on opportunities with transit agencies that are expanding both domestically and in Europe.


The Rail Products and Services segmentgross profit increased by $5,519 to 5.6% of net sales.$2,313, or 19.4%, over the prior year quarter. The increase was primarily attributable to 2016 impairment charges of $4,383 related todriven by the volume growth in both Rail Technologies goodwill. Non-GAAPProducts and Rail Technologies. Segment gross profit increased $1,597, or 13.1%,margin was reduced by 40 bps as a result of the increased domestic distribution volumes.contribution from lower margin Rail Products. Segment profit was $3,479, a $1,431 increase of the prior year quarter. Selling and administrative expenses incurred by the segment as a percent of sales was reduced 130 bps compared to the prior year quarter as the segment continued its focus on cost containment while increasing sales volume.


During the current quarter, the Rail Products and Services segment had an increase in new orders of 44.5%2.6% compared to the prior year period, while backlogperiod. Backlog was $85,764 at September 30, 2017,$121,481 as of March 31, 2019, an increase of 60.6%15.8%, compared to $53,392 at September 30, 2016.$104,923 as of March 31, 2018. The Company iscontinues to be encouraged by continuing positive trends signaling a recovering freight rail market in North America andnew order activity resulting from the strength in the transit system projects expanding globally.


Construction Products
Three Months Ended
March 31,		IncreasePercent
Increase
201920182019 vs. 20182019 vs. 2018
Net sales$37,345 $28,900 $8,445 29.2 %
Gross profit$5,572 $4,032 $1,540 38.2 %
Gross profit percentage14.9 %14.0 %1.0 %6.9 %
Segment profit$834 $18 $816 4,533.3 %
Segment profit percentage2.2 %0.1 %2.2 %3,485.6 %
  Three Months Ended
September 30,		 Increase Percent
Increase
  2017 2016 2017 vs. 2016 2017 vs. 2016
Net Sales $39,118
 $34,870
 $4,248
 12.2%
Segment Profit $3,387
 $1,356
 $2,031
 149.8%
Segment Profit Percentage 8.7% 3.9% 4.8% 123.1%


ThirdFirst Quarter 20172019 Compared to ThirdFirst Quarter 20162018
The Construction Products segment sales increased by $4,248,$8,445, or 12.2%29.2%, compared to the prior year period. The increase was attributable to increases in both Piling and Fabricated Bridge and Precast Concrete Products businesses increased by $4,411of $4,871 and $1,185,$3,574, respectively. Fabricated Bridge generated favorable sales inPiling was able to recognize the initial phases of delivery during the current quarter dueattributable to bridge form projects as well as the continuation of the Peacea significant 2018 order, while Fabricated Bridge project.experienced increased volume within its steel decking and railing product lines. Our Precast Concrete Products business unit was favorably impacted by increased building sales to state agencies. These increases were partially offset by a reduction in Piling salesdriven from 2018 order activity.
23
Table of $1,348, primarily related to lower sheet piling volumes.Contents

The Construction Products segmentgross profit increased by $2,031 to 8.7% of net sales.$1,540, or 38.2%, over the prior year quarter. The increase was primarily attributable to the sales volume related, improved manufacturing efficiencies,growth within Precast Concrete Products and Fabricated Bridge, which lead to a lesser extent, reduced sellingfavorable production rates, and higher margin product mix during the current quarter. Segment profit increased by $816 over the prior year quarter to 2.2% of net sales. Selling and administrative expenses incurred by the segment increased $725 over the prior year quarter; however, the expenses were reduced by 120 bps as a percentage of $163, or 3.4%. Non-GAAP gross profit increased by $1,868, or 30.2%, which was a result of volume increases and manufacturing efficiencies reducing costs.segment sales compared to the prior year period.


During the quarter, the Construction Products segment had a decrease in new orders of 11.1%8.1% compared to the prior year period. The decreaseperiod, which was primarily related to the Piling division. While there was a 47.8% reduction Piling orders due to lower sheet piling demand. This was partially offset by increasedin new orders, the segment maintained a strong backlog of 228.9% and 10.7% for our Fabricated Bridge and Precast Concrete Products businesses, respectively. Ending backlog in the Construction segment decreased by 1.1% to $74,910 from$100,988 as of March 31, 2019, a 17.8% increase over the prior year period.


Tubular and Energy Services
Three Months Ended
March 31,		IncreasePercent
Increase
201920182019 vs. 20182019 vs. 2018
Net sales$37,430 $31,384 $6,046 19.3 %
Gross profit$9,353 $6,236 $3,117 50.0 %
Gross profit percentage25.0 %19.9 %5.1 %25.8 %
Segment profit$4,688 $1,885 $2,803 148.7 %
Segment profit percentage12.5 %6.0 %6.5 %108.5 %
  Three Months Ended
September 30,		 Increase Percent
Increase
  2017 2016 2017 vs. 2016 2017 vs. 2016
Net Sales $30,279
 $22,883
 $7,396
 32.3%
Segment Profit (Loss) $2,298
 $(6,966) $9,264
 133.0%
Segment Profit (Loss) Percentage 7.6% (30.4)% 38.0% 125.0%


ThirdFirst Quarter 20172019 Compared to ThirdFirst Quarter 20162018
Tubular and Energy Services segment sales increased by $7,396,$6,046, or 32.3%19.3%, compared to the prior year period. The increase relatedwas due to strong bookingsimprovements primarily from Protective Coatings and Test and Inspection Services businesses, partially offset by a decrease in Precision Measurement Systems sales. The quarter showed continued improvementwhen compared to the prior year period. This was additionally supported by strong orders within the upstream oil and gas market. Sales inmidstream market during the Precision Measurement Systems business are below prior year, although order input was very strong in the quarter as backlog is now 99.7% above prior year levels.current quarter.


Tubular and Energy Services segment gross profit increased $3,117, or 50.0%, which was supported by growth in both business units within the segment. Segment gross profit margin improved by 510 bps over the prior year quarter which was primarily driven by favorable production rates in the 2019 quarter within Protective Coatings and Measurement Systems and sales volume increases within Test, Inspection, and Threading Services. Segment profit increased by $9,264,$2,803, or 133.0%148.7%, over the prior year quarter. While selling and administrative expense increased $384, management was pleased with the segment's cost containment efforts, which reduced expenses by 80 bps as a percentage of sales compared to the prior year quarter. The quarter was favorably impacted by non-GAAP gross profit of $5,767 over the prior year period, with increases from each division within the segment. The prior year was negatively affected by impairment charges of $2,563 for the three months ended September 30, 2016.period.


The Tubular and Energy Services segment had an increase of 16.2% in new orders of 97.1% compared to the prior year period. Orders for Precision Measurement Systems, Test and Inspection Services, and Protective Coatings increased 147.1%, 129.6%, and 89.2%, respectively. The upstream oil and gas market continues to show signs of recovery. We continue to be encouraged by increased order activity in the midstream market as well.

On July 31, 2017, the lease at our Birmingham, Alabama facility expired. During the third quarter ended September 30, 2017, the Company negotiated a lease renewal for this facility. The renewal is for a term of five years and is scheduled to expire July 31, 2022.

Year-to-Date Results
The segment gross profit measures presented within the MD&A tables constitute non-GAAP financial measures disclosed by management to provide investors and other users information to evaluate the performance of the Company’s segments on a more comparable basis to market trends and peers. The exclusion of significant cost allocations to the reportable segments:

Allows users to understand the operational performance of our reportable segments;
Provides greater comparability to other registrants with similar businesses and avoids possible non-comparability at the reportable segment pre-tax profit level resulting from our specific corporate cost allocations; and
Facilitates a clearer, market-based perspective on the strength or weakness of our reportable segments in their markets to better aid in investment decisions.

In addition, these non-GAAP financial measures have historically been key metrics utilized by segment managers to monitor selling prices and quantities as well as production and service costs to better evaluate key profitability drivers and trends that may develop due to industry and competitive conditions.
Nine months ended September 30, 2017 Rail Products and
Services		 Construction
Products		 Tubular and Energy
Services		 Total
Reportable Segment Profit $8,938
 $9,156
 $1,774
 $19,868
Segment and Allocated Selling & Administrative 27,355
 13,835
 11,711
 52,901
Amortization Expense 2,747
 113
 2,358
 5,218
Asset Impairments —
 —
 —
 —
Non-GAAP Segment Gross Profit $39,040
 $23,104
 $15,843
 $77,987
         
Nine months ended September 30, 2016 Rail Products and
Services		 Construction
Products		 Tubular and Energy
Services		 Total
Reportable Segment (Loss) Profit $(26,474) $5,748
 $(111,876) $(132,602)
Segment and Allocated Selling & Administrative 31,854
 14,781
 12,891
 59,526
Amortization Expense 2,946
 113
 4,759
 7,818
Asset Impairments 32,725
 —
 103,159
 135,884
Non-GAAP Segment Gross Profit $41,051
 $20,642
 $8,933
 $70,626

      Percent of Total Net Sales  
  Nine Months Ended Nine Months Ended Percent
Increase/
(Decrease)
  September 30, September 30, 
  
 2017 2016 2017 2016 2017 vs. 2016
Net Sales:          
Rail Products and Services $187,922
 $188,686
 47.6 % 50.1 % (0.4)%
Construction Products 121,905
 107,098
 30.9
 28.4
 13.8
Tubular and Energy Services 85,227
 81,164
 21.5
 21.5
 5.0
Total net sales $395,054
 $376,948
 100.0 % 100.0 % 4.8 %
           
      Non-GAAP / Reported
Gross Profit Percentage		 Percent
Increase/
(Decrease)
  Nine Months Ended Nine Months Ended 
  September 30, September 30, 
  
 2017 2016 2017 2016 2017 vs. 2016
Gross Profit:          
Non-GAAP Rail Products and Services $39,040
 $41,051
 20.8 % 21.8 % (4.9)%
Non-GAAP Construction Products 23,104
 20,642
 19.0
 19.3
 11.9
Non-GAAP Tubular and Energy Services 15,843
 8,933
 18.6
 11.0
 77.4
Non-GAAP Segment gross profit 77,987
 70,626
      
LIFO (expense) income (1,733) 1,442
 (0.4) 0.4
 (220.2)
Other (901) (492) (0.2) (0.1) 83.1
Total gross profit $75,353
 $71,576
 19.1 % 19.0 % 5.3 %
        Percent
Increase/
(Decrease)
      Percent of Total Net Sales 
  Nine Months Ended Nine Months Ended 
  September 30, September 30, 
  2017 2016 2017 2016 2017 vs. 2016
Expenses:          
Selling and administrative expenses $60,023
 $65,941
 15.2 % 17.5 % (9.0)%
Amortization expense 5,218
 7,818
 1.3
 2.1
 (33.3)
Asset impairments —
 135,884
 —
 36.0
 (100.0)
Interest expense 6,315
 4,342
 1.6
 1.2
 45.4
Interest income (166) (157) —
 —
 5.7
Equity in loss of nonconsolidated investments 5
 946
 —
 0.3
 (99.5)
Other income (564) (263) (0.1) (0.1) 114.4
Total expenses $70,831
 $214,511
 17.9 % 56.9 % (67.0)%
Income (loss) before income taxes $4,522
 $(142,935) 1.1 % (37.9)% 103.2 %
Income tax expense (benefit) 698
 (42,125) 0.2
 (11.2) 101.7
Net income (loss) $3,824
 $(100,810) 1.0 % (26.7)% 103.8 %

First Nine Months of 2017 Compared to First Nine Months of 2016 – Company Analysis
Net sales of $395,054 for the period ended September 30, 2017 increased by $18,106, or 4.8%, compared to the prior year period. The change was attributable to increases of 13.8% and 5.0% in the Construction Products and Tubular and Energy Services segments, respectively. This increase was partially offset by a decrease of 0.4% in the Rail Products and Services segment.

Gross profit margin for the nine months ended September 30, 2017 was 19.1% or 10 bps higher than the prior year period. The increase was due to a 760 bps improvement within the Tubular and Energy Services segment. The increase was partially offset by reductions of 100 bps and 30 bps, in Rail Products and Services and Construction Products, respectively.

Selling and administrative expenses decreased by $5,918 or 9.0% from the prior year. All three segments experienced decreases which were primarily driven by personnel and discretionary spending reductions of $4,021 and reduced litigation costs related to the UPRR matter of $1,419.

Amortization decreased $2,600, or 33.3%, as a result of the June 1, 2016 interim intangible asset impairment test, which was finalized during the three months ended September 30, 2016, resulting in a $59,786 impairment of definite-lived intangible assets. During the nine months ended September 30, 2016, the Company recorded total non-cash asset impairments of $135,884 from goodwill, definite-lived intangible assets, and property, plant, and equipment.

Interest expense, net of interest income, increased by $1,964, or 46.9%, as a result of the increase in interest rates on outstanding debt. Other income increased by $301, or 114.4%, which primarily related to the gain on the sale of certain assets, which was partially offset by the impact of a weaker United States Dollar relative to the Canadian Dollar in the nine months ended September 30, 2017.

The Company’s effective income tax rate for the nine months ended September 30, 2017 was 15.4%, compared to 29.5% in the prior year period. For the first nine months ended September 30, 2017, the Company recorded a tax provision of $698, compared to a tax benefit of $42,125 in the nine months ended September 30, 2016. The Company’s tax provision for the nine months ended September 30, 2017 was primarily comprised of taxes on our Canadian and United Kingdom operations. The Company continued to maintain a full valuation allowance against its U.S. deferred tax assets.

Net income for the first nine months of 2017 was $3,824, or $0.37 per diluted share, compared to a net loss of $100,810, or $9.82 per diluted share, in the prior year period. The following table provides a reconciliation of the GAAP earnings per share value to the non-GAAP adjusted earnings1 per share value for the nine-month periods ended September 30, 2017 and 2016:

  Nine Months Ended
September 30,
  2017 2016
  (Unaudited)
Adjusted Diluted Earnings (Loss) Per Share Reconciliation    
Net income (loss), as reported $3,824
 $(100,810)
Asset impairments, net of tax benefits of $39,038 —
 96,846
Adjusted net income (loss) $3,824
 $(3,964)
Average number of common shares outstanding - Diluted 10,435
 10,264
Diluted earnings (loss) per common share, as reported $0.37
 $(9.82)
Diluted earnings (loss) per common share, as adjusted $0.37
 $(0.39)

1 All results in this Quarterly Report that exclude asset impairment charges are non-GAAP measures used for management reporting purposes. Management believes that these measures provide useful information to investors because they will assist investors in evaluating earnings performance on a comparable year-over-year basis.

Results of Operations – Segment Analysis
Rail Products and Services
  Nine Months Ended
September 30,		 (Decrease)/Increase Percent
(Decrease)/Increase
  2017 2016 2017 vs. 2016 2017 vs. 2016
Net Sales $187,922
 $188,686
 $(764) (0.4)%
Segment Profit (Loss) $8,938
 $(26,474) $35,412
 133.8 %
Segment Profit (Loss) Percentage 4.8% (14.0)% 18.8% 134.3 %

First Nine Months of 2017 Compared to First Nine Months of 2016
Rail Products and Services segment sales decreased $764, or 0.4%, compared to the prior year period. The reduction in sales is primarily related to a decrease in our domestic businesses of $5,956, or 4.3%. The sales declines were primarily volume driven by the domestic freight rail and transit markets. Our domestic rail distribution business was unfavorably impacted by both volume and pricing compared to the prior year period. The sales decrease was partially offset by sales increases in our foreign divisions of $5,192, or 10.6%, as we saw favorable results in both our Canadian and European markets.

The Rail Products and Services segment profit increased by $35,412 to 4.8% of net sales. The increase was primarily attributable to a reduction in selling, administrative, and allocated expenses of $4,430, or 13.9%, and the 2016 impairment charges of $32,725 related to Rail Technologies goodwill. This was partially offset by a decline in non-GAAP gross profit of $2,011, or 4.9%, which was primarily related to volume reductions and product mix within domestic transit products, as well as service related cost increases in our domestic Rail Technologies business.

During the current year, the Rail Products and Services segment had an increase in new orders of 28.9% compared to the prior year period. The increase impacted each of the three business units within the segment and grew the backlog balance to $85,764 at September 30, 2017, a 60.6% increase over the prior year. The Company is also encouraged by positive signs from order activity and resulting backlog during the first nine months of 2017.

Construction Products
  Nine Months Ended
September 30,		 Increase Percent
Increase
  2017 2016 2017 vs. 2016 2017 vs. 2016
Net Sales $121,905
 $107,098
 $14,807
 13.8%
Segment Profit $9,156
 $5,748
 $3,408
 59.3%
Segment Profit Percentage 7.5% 5.4% 2.1% 38.9%

First Nine Months of 2017 Compared to First Nine Months of 2016
Construction Products segment sales increased by $14,807, or 13.8%, compared to the prior year period. The increase related to Fabricated Bridge and Piling businesses of $9,428 and $7,112, respectively. Fabricated Bridge continued to have favorable sales in the current year due to several projects, including the continuation of the Peace Bridge project. The increase in Piling was primarily due to demand within the sheet piling product line. These increases were offset by a reduction in Precast Concrete Products sales of $1,733.

The Construction Products segment profit increased by $3,408 to 7.5% of net sales. The increase related to reductions in selling, administrative, and allocated expenses of $947, or 6.4%. Non-GAAP gross profit increased $2,462, or 11.9%, which was primarily due to the increased volumes from the Fabricated Bridge and Piling businesses within the period.

During the period, the Construction Products segment had a decrease in new orders of 8.7% compared to the prior year period. Prior year Fabricated Bridge orders included the $15,000 Peace Bridge project. Piling saw a 6.3% reduction in new orders compared to the prior year from recent declines in sheet piling demand. The Precast Concrete Products business saw an increase in new orders of 10.7% primarily from building orders from state agencies. The Construction Products segment had backlog at September 30, 2017 of $74,910, a 1.1% decrease over the prior year.

Tubular and Energy Services
  Nine Months Ended
September 30,		 Increase Percent
Increase
  2017 2016 2017 vs. 2016 2017 vs. 2016
Net Sales $85,227
 $81,164
 $4,063
 5.0%
Segment Profit (Loss) $1,774
 $(111,876) $113,650
 101.6%
Segment Profit (Loss) Percentage 2.1% (137.8)% 139.9% 101.5%

First Nine Months of 2017 Compared to First Nine Months of 2016
Tubular and Energy Services segment sales increased $4,063, or 5.0%, compared to the prior year period. The increase related to growth from Test and Inspection Services and Protective Coating businesses, partially offset by a decrease in Precision Measurement Systems. The period showed increased new well count and demand within the upstream oil and gas market, but was negatively impacted by a lag in the recovery of Precision Measurement Systems for midstream applications.

Tubular and Energy Services segment profit increases by $113,650, or 101.6%, compared to the prior year period. The period was favorably impacted by a reduction in amortization expense of $2,401 from the 2016 definite-lived intangible asset impairment. The prior period was also negatively affected by impairment charges of $103,159 for the nine months ended September 30, 2016. Segment profit was also favorably impacted by a non-GAAP gross profit increase of $6,910, or 77.4%.

The Tubular and Energy Services segment had an increase in new orders of 47.6% compared to the prior year period. Orders for Protective Coatings and Test and Inspection Services businessesMeasurement Systems increased by 151.2%32.9%, which was partially offset by a reduction in Test, Inspection, and 107.5%, respectively.Threading Services of 5.2%. The upstream oil and gas marketCompany is encouraged with the continued its recovery. We are also encouraged by positive trends in midstream order activity as we endedgrowth of new orders within the nine-month period.segment.

On July 31, 2017, the lease at our Birmingham, Alabama facility expired. During the third quarter ended September 30, 2017, the Company negotiated a lease renewal for this facility. The renewal is for a term of five years and is scheduled to expire July 31, 2022.


Other
Segment Backlog
Total Company backlog is summarized by business segment in the following table for the periods indicated:
March 31,
2019		December 31,
2018		March 31,
2018
Rail Products and Services$121,481 $97,447 $104,923 
Construction Products100,988 95,419 85,713 
Tubular and Energy Services27,583 27,552 29,665 
Total Backlog$250,052 $220,418 $220,301 
  Backlog
  September 30,
2017		 December 31,
2016		 September 30,
2016
Rail Products and Services $85,764
 $62,743
 $53,392
Construction Products 74,910
 71,954
 75,762
Tubular and Energy Services 28,931
 12,759
 14,650
Total Backlog $189,605
 $147,456
 $143,804


While a considerable portion of our business is backlog-driven, certain product lines within the Rail Products and Services and Tubular and Energy Services segments are not driven by backlog and therefore have insignificant levels throughout the year.

Warranty
As of September 30, 2017, the Company maintained a total product warranty reserve of $9,614 for its estimate of all potential product warranty claims. Of this total, $7,607 reflects the current estimate of the Company’s exposure for potential concrete tie warranty claims. While the Company believes this is a reasonable estimate of its potential exposure related to identified concrete tie warranty matters, the Company may incur future charges associated with new customer claims or further development of information of existing customer claims. Thus, there can be no assurance that future potential costs pertaining to warranty claims will not have a material impact on the Company’s results of operations and financial condition. See Note 13 Commitments and Contingent Liabilities of the Notes to Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q for additional information.


Liquidity and Capital Resources
Total debt was $138,285$90,182 and $159,565$74,982 as of September 30, 2017March 31, 2019 and December 31, 2016,2018, respectively, and was primarily comprised of borrowings onunder our revolving credit facility and term loan.

facility. Our need for liquidity relates primarily to working capital requirements for operations, capital expenditures, joint venture capital obligations,and debt service obligations, and share repurchases as authorized by the Boardobligations.



24
Table of Directors and as permitted under the Second Amended and Restated Credit Agreement dated March 13, 2015.Contents

The change in cash and cash equivalents for the periodsthree months ended September 30 areMarch 31, 2019 and 2018 is as follows:
March 31,
20192018
Net cash (used in) provided by operating activities$(13,546)$2,591 
Net cash used in investing activities(2,513)(714)
Net cash provided by (used in) financing activities14,674 (27,873)
Effect of exchange rate changes on cash and cash equivalents142 (698)
Net decrease in cash and cash equivalents$(1,243)$(26,694)
  September 30,
  2017 2016
Net cash provided by operating activities $27,516
 $11,876
Net cash used by investing activities (3,947) (6,219)
Net cash used by financing activities (21,384) (35,470)
Effect of exchange rate changes on cash and cash equivalents 2,460
 152
Net increase (decrease) in cash and cash equivalents $4,645
 $(29,661)


Cash Flow from Operating Activities
During the current 2017 nine-month period,three months ended March 31, 2019, cash flows provided byused in operating activities were $27,516$13,546 compared to $11,876operations providing $2,591 during the prior year period. For the ninethree months ended September 30, 2017,March 31, 2019, income and adjustments to income from operating activities provided $18,985$8,842 compared to $15,976$2,701 in the 20162018 period. Working capital and other assets and liabilities provided $8,531used $22,388 in the current period compared to a use of $4,100$110 in the prior year period. Inventory and accounts receivable increased the use of operating cash flows by $14,417 and $13,176, respectively, compared to the 2018 period, on a sales increase of 22.9% over the same period. During the ninethree months ended September 30, 2017,March 31, 2019, the Company received $9,946 and $1,827 from our 2016 and 2015 federal income tax refunds, respectively.made a payment of $2,000 under the terms of the concrete tie settlement agreement with Union Pacific Railroad.


The Company’s calculation for days sales outstanding at September 30, 2017March 31, 2019 and December 31, 2018 was 50 days, compared to 53 days at December 31, 2017, and we believe our receivables portfolio is strong.


Cash Flow from Investing Activities
Capital expenditures for the ninethree months ended September 30, 2017March 31, 2019 and 20162018 were $5,335$2,572 and $6,507,$723, respectively. The current year expenditures relate to trackside rail lubricator units installedplant expansion and automation integration programs within our Tubular and Energy Services segment as part of a new multi-year service contractwell as general plant and operational improvements throughout the Company. Expenditures for the three months ended March 31, 2018 related to expenditures for general plant and operational improvements. Expenditures forDuring the ninethree months ended September 30, 2016 related to the Birmingham, AL inside diameter coating line upgrade and application development of the Company’s new enterprise resource planning system. During nine months ended September 30, 2017,March 31, 2019, the Company received $1,388$59 in proceeds from the sale of certain property, plant, and equipment as compared to $923$9 in the prior year period. The Company also loaned $635 to our joint venture, L B Pipe & Coupling Products, LLC (“L B Pipe JV”), as of September 30, 2016.


Cash Flow from Financing Activities
During the ninethree months ended September 30, 2017,March 31, 2019, the Company had an increase in outstanding debt of $15,200, primarily related to the funding of working capital for operations. During the three months ended March 31, 2018, the Company had a decrease in outstanding debt of $21,281,$27,563, primarily related to payments against the revolving credit facility as well aswhich was facilitated by the applicationrepatriation of the $9,946 federal income tax refund and quarterly principle payments against the term loan. During the nine months ended September 30, 2016, the Company had a decrease$24,693 in outstanding debt of $33,125, primarily related to payments against the revolving credit facility.excess cash from our international locations. Treasury stock acquisitions represent income tax withholdings from employees in connection with the vesting of restricted stock awards. Cash outflows related to dividends were $1,244 for the nine-month periods ended September 30, 2016.


Financial Condition
As of September 30, 2017,March 31, 2019, we had $35,008$9,039 in cash and cash equivalents and a domestic credit facility with $46,081$105,361 of net availability while we had $138,285$90,182 in total debt. We believe this liquidity will provide the flexibility to operate the business in a prudent manner and enable us to continue to service our revolving credit facility and term loan.facility.


Our cash management priority continues to be short-term maturities and the preservation of our principal balances. Approximately $33,976As of March 31, 2019, approximately $8,207 of our cash and cash equivalents was held in non-domestic bank accounts, and, under current law, the foreign cash would be subject to U.S. federal income taxes less applicable foreign tax credits upon repatriation.accounts.

On November 7, 2016, the Company, its domestic subsidiaries, and certain of its Canadian subsidiaries entered into the Second Amendment (the “Second Amendment”) to the Second Amended and Restated Credit Agreement dated March 13, 2015 and as amended by the First Amendment dated June 29, 2016 (the “Amended and Restated Credit Agreement”), with PNC Bank, N.A., Bank of America, N.A., Wells Fargo Bank, N.A., Citizens Bank of Pennsylvania, and Branch Banking and Trust Company. This Second Amendment modified the Amended and Restated Credit Agreement, which had a maximum revolving credit line of $275,000.

The Second Amendment reduced the permitted revolving credit borrowings to $195,000 and provided for additional term loan borrowings of $30,000 (the “Term Loan”). The Term Loan is subject to quarterly straight line amortization until fully paid off upon the final payment on January 1, 2020. Furthermore, certain matters, including excess cash flow, asset sales, and equity issuances, trigger mandatory prepayments to the Term Loan. Term Loan borrowings are not available to draw upon once they have been repaid. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Second Amendment or Amended and Restated Credit Agreement, as applicable.

The Second Amendment further provided for modifications to the financial covenants as defined in the Amended and Restated Credit Agreement. The Second Amendment calls for the elimination of the Maximum Leverage Ratio covenant through the quarter ending June 30, 2018. After that period, the Maximum Gross Leverage Ratio covenant will be reinstated to require a maximum ratio of 4.25 Consolidated Indebtedness to 1.00 Gross Leverage for the quarter ending September 30, 2018, and 3.75 to 1.00 for all periods thereafter until the maturity date of the credit facility. The Second Amendment also includes a Minimum Last Twelve Months EBITDA (as defined by the Amendment) covenant (“Minimum EBITDA”). For the quarter ended December 31, 2016 through the quarter ended June 30, 2017, the Minimum EBITDA must be at least $18,500. For each quarter thereafter, through the quarter ending June 30, 2018, the Minimum EBITDA requirement will increase by various increments. The incremental Minimum EBITDA requirement for the period ending September 30, 2017 must be at least $23,000. During the third quarter ended September 30, 2017, the rolling 12-month EBITDA calculation, as defined by the Amended and Restated Credit Agreement, was $32,063. At June 30, 2018, the Minimum EBITDA requirement will be $31,000. After the quarter ending June 30, 2018, the Minimum EBITDA covenant will be eliminated through the maturity of the Amended and Restated Credit Agreement. The Second Amendment also includes a Minimum Fixed Charge Coverage Ratio covenant. The covenant represents the ratio of the Company’s fixed charges to the last twelve months of EBITDA, and is required to be a minimum of 1.00 to 1.00 through the quarter ending December 31, 2017 and 1.25 to 1.00 for each quarter thereafter through the maturity of the credit facility. The final financial covenant included in the Second Amendment is a Minimum Liquidity covenant which calls for a minimum of $25,000 in undrawn availability on the revolving credit loan at all times through the quarter ending June 30, 2018.

The Second Amendment includes several changes to certain non-financial covenants, as defined in the Amended and Restated Credit Agreement. Through the maturity date of the loan, the Company is now prohibited from making any future acquisitions. The limitation on permitted annual distributions of dividends or redemptions of the Company’s stock was decreased from $4,000 to $1,700. The aggregate limitation on loans to and investments in non-loan parties was decreased from $10,000 to $5,000. Furthermore, the limitation on asset sales has been decreased from $25,000 annually with a carryover of up to $15,000 from the prior year to $25,000 in the aggregate through the maturity date of the credit facility.

The Second Amendment provided for the elimination of the three lowest tiers of the pricing grid that had previously been defined in the First Amendment. Upon execution of the Second Amendment through the quarter ending March 31, 2018, the Company will be locked into the highest tier of the pricing grid, which provides for pricing of the prime rate plus 225 basis points on base rate loans and the applicable LIBOR rate plus 325 basis points on euro rate loans. For each quarter after March 31, 2018 and through the maturity date of the credit facility, the Company’s position on the pricing grid will be governed by a Minimum Net Leverage ratio, which is the ratio of Consolidated Indebtedness less cash on hand in excess of $15,000 to EBITDA. If, after March 31, 2018, the Minimum Net Leverage ratio positions the Company on the lowest tier of the pricing grid, pricing will be the prime rate plus 150 basis points on base rate loans or the applicable LIBOR rate plus 250 basis points on euro rate loans.


To reduce the impact of interest rate changes on outstanding variable-rate debt, the Company entered into forward starting LIBOR-based interest rate swaps with notional values totaling $50,000. The swaps became effective on February 28, 2017 at which point they effectively convertconverted a portion of the debt from variable to fixed-rate borrowings during the term of the swap contract. At September 30, 2017,As of March 31, 2019, the swap liabilityasset was $323$626 compared to $334$675 as of December 31, 2016.2018.


Cost in ExcessSubsequent to March 31, 2019, on April 30, 2019, the Company, its domestic subsidiaries, and certain of Net Assets Acquired
At Septemberits Canadian and European subsidiaries (collectively, the “Borrowers”), entered into the Third Amended and Restated Credit Agreement (“Amended Credit Agreement”) with PNC Bank, N.A., Bank of America, N.A., Wells Fargo Bank, N.A., Citizens Bank, N.A., and BMO Harris Bank, N.A. This Amended Credit Agreement modifies the prior revolving credit facility which had a maximum credit line of $195,000, and extends the maturity date from March 13, 2020 to April 30, 2017, L.B. Foster had $19,6992024. The Amended Credit Agreement provides for a five-year, revolving credit facility that permits aggregate borrowings of goodwill on its consolidated balance sheet. Of the total, $14,552 relatedBorrowers up to $140,000 with a sublimit of the equivalent of $25,000 U.S. dollars that is available to the Rail ProductsCanadian and Services segmentUnited Kingdom borrowers in the aggregate. The Amended Credit Agreement’s incremental loan feature permits the Company to increase the available revolving borrowings under the facility by up to an additional
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$50,000 and $5,147 relatedprovides for additional term loan borrowings of up to $25,000 subject to the Construction Products segment. Goodwill is reviewed annuallyCompany’s receipt of increased commitments from existing or new lenders and the satisfaction of certain conditions.

For a discussion of the terms and availability of the Company's credit facilities, please refer to Note 9 of the Notes to Condensed Consolidated Financial Statements contained in the fourth quarter of each year for impairment or more frequently if impairment indicators arise. The Company recorded a $32,725 partial goodwill impairment related to the Rail Products and Services segment during the year ended December 31, 2016. BasedQuarterly Report on considerations of current year financial results, including consideration of macroeconomic conditions, such as performance of the Company’s stock price, we do not believe that it is more-likely-than-not that the fair values of these reporting units have decreased below their carrying values at September 30, 2017. Consequently, management concluded that none of the Company’s reporting units experienced any triggering event that would have required a step one interim goodwill impairment analysis at September 30, 2017. However, the previously recorded partial impairment included assumptions for certain market recoveries throughout the years ending December 31, 2017 and 2018, if these recoveries do not fully develop, the Rail Products and Services segment may require an incremental goodwill impairment.Form 10-Q.


Critical Accounting Policies
The Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the United States. When more than one accounting principle, or method of its application, is generally accepted, management selects the principle or method that, in its opinion, is appropriate in the Company’s specific circumstances. Application of these accounting principles requires management to reach opinions regarding estimates about the future resolution of existing uncertainties. As a result, actual results could differ from these estimates. In preparing these financial statements, management has reached its opinions regarding the best estimates and judgments of the amounts and disclosures included in the financial statements giving due regard to materiality. ThereWe have been no material changes in the Company’s critical accountingupdated our lease policies or estimates since December 31, 2016.2018, in conjunction with our adoption of Accounting Standards Codification 842, “Leases” (“ASC 842”) as further described in Note 8 of the Notes to Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q. A summary of the Company’s critical accounting policies and estimates is included in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations- Critical Accounting Policies and Estimates in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016.2018.


Off-Balance Sheet Arrangements
The Company’s off-balance sheet arrangements include operating leases, purchase obligations and standby letters of credit. A schedule of the Company’s required payments under financial instruments and other commitments as of December 31, 20162018 is included in the “LiquidityItem 7. Management's Discussion and Analysis of Financial Condition and Results of Operations -Liquidity and Capital Resources” sectionResources -Tabular Disclosure of Contractual Obligations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016.2018. During the three months ended March 31, 2019, the Company adopted the provisions under ASC 842 on January 1, 2019. As a result of the adoption, operating leases that were previously off-balance sheet arrangements are now recognized as right-of-use assets and liabilities within the Condensed Consolidated Balance Sheets as of March 31, 2019. There were no other material changes to these off-balance sheet arrangements during the current quarter. These arrangements provide the Company with increased flexibility relative to the utilization and investment of cash resources.

Item 3. Quantitative and Qualitative Disclosures about Market Risk
Interest Rate Risk
The CompanyThis item is exposed to risks that increases in interest rates may adversely affect funding costs associated with its variable-rate debt. To reduce the impact of interest rate changes on a portion of this variable-rate debt, the Company entered into forward starting interest rate swap agreements which effectively convert a portion of the debt from a variablenot applicable to a fixed-rate borrowing during the term of the swap contracts. See Note 9 Fair Value Measurements of the Notes to Condensed Consolidated Financial Statements contained in this Quarterly Report on Form 10-Q for additional information.smaller reporting company.

For the nine months ended September 30, 2017, a 1% change in the interest rate for variable rate debt as of September 30, 2017 would increase or decrease interest expense by approximately $1,069.

The Company does not purchase or hold any derivative financial instruments for trading purposes. It does enter into interest rate hedges to reduce the risk in the variability of interest rate fluctuations. At contract inception, the Company designates its derivative instruments as hedges. The Company recognizes all derivative instruments on the balance sheet at fair value. Fluctuations in the fair values of derivative instruments designated as cash flow hedges are recorded in accumulated other comprehensive income and reclassified into earnings within other income as the underlying hedged items affect earnings. To the extent that a change in a derivative does not perfectly offset the change in the value of the interest rate being hedged, the ineffective portion is recognized in earnings immediately.

As of September 30, 2017 and December 31, 2016, the Company recorded a current liability of $323 and $334, respectively, related to its LIBOR-based interest rate swap agreements.

Foreign Currency Exchange Rate Risk
The Company is subject to exposures to changes in foreign currency exchange rates. The Company may manage its exposure to changes in foreign currency exchange rates on firm sale and purchase commitments by entering into foreign currency forward contracts. The Company’s risk management objective is to reduce its exposure to the effects of changes in exchange rates on these transactions over the duration of the transactions. The Company did not engage in foreign currency hedging transactions during the nine-month periods ended September 30, 2017 and 2016.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
L.B. Foster Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of September 30, 2017.March 31, 2019. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective such that the information required to be disclosed by the Company in reports filed under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to management, including the chief executive officer, chief financial officer, or person performing such functions, as appropriate to allow timely decisions regarding disclosure.


Changes in Internal Control Over Financial Reporting
On January 1, 2019, the Company adopted the standards of Accounting Standards Codification 842, “Leases” (“ASC 842”). The adoption of ASC 842 required the Company to implement changes to our processes related to operating lease recognition and the control activities within them. This included the development of new policies and procedures, ongoing lease review and evaluation processes, and implementation of processes to obtain information responsive to the new disclosure requirements. There were no other changes into our “internal control over financial reporting” (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the ninethree months ended September 30, 2017,March 31, 2019, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. The Company is currently evaluating the impact that Accounting Standards Update 2014-09, "Revenue from Contracts with Customers (Topic 606)" will have on our internal control over financial reporting at the January 1, 2018 adoption date.


Limitations on Effectiveness of Controls and Procedures
In designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

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PART II. OTHER INFORMATION
(Dollars in thousands, except share data)
Item 1. Legal Proceedings
See Note 13 Commitments and Contingent Liabilities14 of the Notes to Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q, which is incorporated herein by reference.
Item 1A. Risk Factors
There have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2016. You should carefully consider the factors discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2016, as filed with the SEC on March 8, 2017, which could materially affect our business, financial condition, financial results, or future performance. The risks described in our Annual Report on Form 10-K and quarterly reports on Form 10-Q areThis item is not the only risks facing the Company. Additional risks and uncertainties not currently known or that we currently deemapplicable to be immaterial may also materially affect our business, financial condition, and/or results of operations.a smaller reporting company.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
The Company’s purchases of equity securities for the three months ended September 30, 2017March 31, 2019 were as follows:
Total number of shares purchased (1)Average price paid per shareTotal number of shares purchased as part of publicly announced plans or programsApproximate dollar value of shares that may yet be purchased under the plans or programs
January 1, 2019 - January 31, 20191,011 $18.03 — $— 
February 1, 2019 - February 28, 201924,076 17.87 — — 
March 1, 2019 - March 31, 20194,361 17.62 — — 
Total29,448 $17.84 — $— 

(1) Shares withheld by the Company to pay taxes upon vesting of restricted stock awards.
  Total number of shares purchased (1) Average price paid per share Total number of shares purchased as part of publicly announced plans or programs (2) Approximate dollar value of shares that may yet be purchased under the plans or programs
July 1, 2017 - July 31, 2017 —
 $—
 —
 $29,933
August 1, 2017 - August 31, 2017 324
 18.40
 —
 29,933
September 1, 2017 - September 30, 2017 —
 —
 —
 29,933
Total 324
 $18.40
 —
 $29,933
(1)Shares withheld by the Company to pay taxes upon vesting of restricted stock. These shares do not impact the remaining authorization to repurchase shares under approved plans or programs.

(2)On December 9, 2015, the Board of Directors authorized the repurchase of up to $30,000 of the Company’s common shares until December 31, 2017. This authorization became effective January 1, 2016. The $30,000 repurchase authorization is restricted under the terms of the Second Amendment to the Second Amended and Restated Credit Agreement dated March 13, 2015. Dividends, distributions, and redemptions under the Second Amendment are capped at a maximum annual amount of $1,700 throughout the life of the repurchase authorization. For the three-month period ended September 30, 2017, there were no share repurchases as part of the authorized program.
Item 4. Mine Safety Disclosures
This item is not applicable to the Company.

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Table of Contents
Item 6. Exhibits
See Exhibit Index below.


Exhibit Index

Exhibit NumberDescription
Exhibit Number10.1Description
10.1
*10.2
*31.110.3
*10.4
*10.5
*31.1
*31.2
*32.0
*101.INSXBRL Instance Document.Document-the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
*101.SCHXBRL Taxonomy Extension Schema Document.
*101.CALXBRL Taxonomy Extension Calculation Linkbase Document.
*101.DEFXBRL Taxonomy Extension Definition Linkbase Document.
*101.LABXBRL Taxonomy Extension Label Linkbase Document.
*101.PREXBRL Taxonomy Extension Presentation Linkbase Document.
 
*Exhibits marked with an asterisk are filed herewith.



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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
L.B. FOSTER COMPANY
(Registrant)
Date:November 8, 2017May 10, 2019By: /s/ James P. Maloney
James P. Maloney
Senior Vice President,
Chief Financial Officer, and Treasurer
(Duly Authorized Officer of Registrant)



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