Wabtec Reports 2Q EPS of 69 Cents, Up 21%; Company Also Increases 2008 Guidance

WILMERDING, Pa., July 22 /PRNewswire-FirstCall/ -- Wabtec Corporation
(NYSE: WAB) today reported its 2008 second quarter results, including the
following highlights:
-- Second quarter sales increased 20 percent compared to the year-ago
quarter to a record $390 million, as the company continued to execute its
growth strategies.
-- Income from operations increased 22 percent to $56 million, or 14.3
percent of sales, compared to 14.1 percent in the year-ago quarter, due to the
benefits of the Wabtec Performance System and operating leverage from higher
sales.
-- Earnings per diluted share were a record 69 cents, 21 percent above the
year-ago quarter.
-- At June 30, 2008, the company's multi-year backlog was $1.2 billion, 3
percent higher than at March 31, 2008, even with the record sales quarter.
Based on its second quarter results and outlook for the rest of the year,
Wabtec increased its 2008 earnings guidance to about $2.65 per diluted share,
with full-year revenue now expected to grow at 12-14 percent, even though
production of new freight cars in the U.S. will decline this year.
Previously, the company expected sales growth of high-single-digits and
earnings per diluted share of about $2.55.
Albert J. Neupaver, Wabtec's president and chief executive officer, said:
"Our second quarter performance was strong, with a variety of initiatives
driving growth, including international and aftermarket expansion. We
generated strong cash from operations and finished the first half of the year
with cash, net of debt, at about $90 million, most of which was used to
complete the acquisition of POLI, a European-based manufacturer of brake
equipment, after the end of the quarter. Since 2005, we have made five
acquisitions, all of which were financed with internally generated cash from
operations. Although we remain cautious about the economic outlook in the
U.S. and abroad, we are confident in our growth prospects for the rest of 2008
and beyond."
Wabtec Corporation (http://www.wabtec.com) is a global provider of
value-added, technology-based products and services for the freight rail and
passenger transit industry. Through its subsidiaries, the company manufactures
a range of products for locomotives, freight cars, subway cars and buses. The
company also builds new switcher and commuter locomotives, and provides
aftermarket services.
This release contains forward-looking statements, such as statements
regarding the company's expectations about future earnings. Actual results
could differ materially from the results suggested in any forward-looking
statement. Factors that could cause or contribute to these material
differences include, but are not limited to, a slowdown in the North American
economy; a decrease in freight or passenger rail traffic; an increase in
manufacturing costs; and other factors discussed in the company's filings with
the Securities and Exchange Commission. The company assumes no obligation to
update these statements or advise of changes in the assumptions on which they
are based.
The company will conduct a conference call with analysts and investors at
10 a.m., eastern time, today. To listen to the call via webcast, please go to
http://www.wabtec.com and click on the "Webcasts" tab in the "Investor
Relations" section.

WABTEC CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2008 AND 2007
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
(UNAUDITED)

Second Second For the For the
Quarter Quarter Six Months Six Months
2008 2007 2008 2007

Net sales $390,194 $325,722 $773,521 $639,986
Cost of sales (281,693) (234,872) (559,805) (462,570)
Gross profit 108,501 90,850 213,716 177,416
Gross profit as a % of Net Sales 27.8% 27.9% 27.6% 27.7%

Selling, general and administrative
expenses (42,036) (34,915) (82,481) (69,860)
Engineering expenses (9,631) (9,026) (19,612) (17,842)
Amortization expense (912) (992) (1,815) (1,533)
Total operating expenses (52,579) (44,933) (103,908) (89,235)
SGA as a % of Net Sales 10.8% 10.7% 10.7% 10.9%
Operating expenses as a % of Net
Sales 13.5% 13.8% 13.4% 13.9%

Income from operations 55,922 45,917 109,808 88,181
Income from operations as a %
of Net Sales 14.3% 14.1% 14.2% 13.8%

Interest income (expense), net (1,293) (686) (2,774) (1,469)
Other income (expense), net (696) (1,637) (1,079) (2,446)
Income from continuing
operations before income
taxes 53,933 43,594 105,955 84,266

Income tax expense (20,171) (15,469) (39,680) (30,587)
Effective tax rate 37.4% 35.5% 37.4% 36.3%

Income from continuing
operations 33,762 28,125 66,275 53,679

Discontinued operations
Income (loss) from
discontinued operations (net
of tax) - 5 (3) (27)

Net income $33,762 $28,130 $66,272 $53,652

Earnings Per Common Share
Basic

Income from continuing
operations $0.70 $0.58 $1.37 $1.11
Income (loss) from
discontinued operations - - - -
Net income $0.70 $0.58 $1.37 $1.11

Diluted

Income from continuing
operations $0.69 $0.57 $1.35 $1.09
Income (loss) from
discontinued operations - - - -
Net income $0.69 $0.57 $1.35 $1.09

Weighted average shares
outstanding
Basic 48,095 48,666 48,306 48,413
Diluted 48,655 49,294 48,924 49,022

Sales by Segment

Freight Group $199,631 $180,986 $391,397 $365,653
Transit Group 190,563 144,736 382,124 274,333
Total $390,194 $325,722 $773,521 $639,986

SOURCE Wabtec Corporation

Tim Wesley of Wabtec Corporation, +1-412-825-1543, twesley@wabtec.com