Westinghouse Air Brake Technologies Corporation (Wabtec) reported strong financial performance for the third quarter and the first nine months of 2024, with net sales reaching $2.663 billion for Q3, a 4.4% increase from $2.550 billion in Q3 2023. For the nine months ended September 30, 2024, net sales totaled $7.804 billion, up 9.1% from $7.151 billion in the same period last year. This growth was driven by increased sales in both the Freight and Transit segments, with organic sales contributing significantly.
Gross profit for Q3 2024 was $880 million, compared to $792 million in Q3 2023, while gross profit for the nine months increased to $2.569 billion from $2.180 billion. The company reported net income of $286 million for Q3 2024, up from $242 million in Q3 2023, and net income for the nine months rose to $854 million from $608 million in the prior year. Earnings per share attributable to Wabtec shareholders for Q3 2024 were $1.63, compared to $1.34 in Q3 2023.
Wabtec's operational efficiency improved, with the cost of sales as a percentage of net sales decreasing to 67.0% in Q3 2024 from 69.0% in Q3 2023. Operating expenses increased by 5.9% in Q3 2024, primarily due to higher sales volume and restructuring costs associated with the company's strategic initiatives.
Strategically, Wabtec has been active in acquisitions, including the purchase of the remaining 50% of Lokomotiv Kurastyru Zauyty (LKZ) for $111 million, making it a wholly owned subsidiary. Additionally, the acquisition of L&M Radiator, Inc. for approximately $245 million in Q2 2023 has been integrated into the company's operations. The pro forma impact of these acquisitions on sales and operations was not deemed significant.
Wabtec has also initiated a three-year strategic plan called "Integration 2.0," aimed at consolidating operations and reducing headcount, with expected one-time restructuring charges of approximately $135 million to $165 million. As of September 30, 2024, the company incurred about $140 million in restructuring costs related to this initiative.
The company continues to face challenges, including macroeconomic volatility and supply chain disruptions, which may impact future revenue and cash flows. However, Wabtec's diversified global operations, with approximately 52% of net sales coming from international customers, position it well for continued growth.
About WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORP
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