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 SeptemberJune 30, 20172023
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)
lbflogo.gif
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)
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 by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒   No ☐

Indicate by check mark whether the registrant has submitted electronically 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, a 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 checkmarkcheck mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No ☒
Indicate the number
As of August 1, 2023, there were 11,091,020 shares outstanding of each of the issuer’s classes ofregistrant’s common stock, as of the latest practicable date.par value $0.01 per share, outstanding.


ClassOutstanding as of October 31, 2017
Common Stock, Par Value $0.0110,340,576 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)(Loss)
5
Condensed Consolidated Statements of Cash Flows
6
Condensed Consolidated Statements of Stockholders’ Equity
7
Notes to Condensed Consolidated Financial Statements
89
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
2320
Item 3. Quantitative and Qualitative Disclosures about Market Risk
3729
Item 4. Controls and Procedures
3729
29
Item 1. Legal Proceedings
3830
Item 1A. Risk Factors
3830
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
3830
Item 3. Defaults Upon Senior Securities
30
Item 4. Mine Safety Disclosures
3830
Item 5. Other Information
30
Item 6. Exhibits
3932
Signature
4033



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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)
  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

June 30,
2023		December 31,
2022
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents$3,880 $2,882 
Accounts receivable - net (Note 5)74,249 82,455 
Contract assets - net (Note 3)34,011 33,613 
Inventories - net (Note 6)79,451 75,721 
Other current assets12,182 11,061 
Total current assets203,773 205,732 
Property, plant, and equipment - net76,948 85,344 
Operating lease right-of-use assets - net15,770 17,291 
Other assets:
Goodwill (Note 4)31,404 30,733 
Other intangibles - net (Note 4)21,256 23,831 
Deferred tax assets (Note 9)— 24 
Other assets2,417 2,355 
TOTAL ASSETS$351,568 $365,310 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$43,933 $48,782 
Deferred revenue15,969 19,452 
Accrued payroll and employee benefits8,709 10,558 
Current portion of accrued settlement (Note 13)8,000 8,000 
Current maturities of long-term debt (Note 7)102 127 
Other accrued liabilities14,928 16,192 
Total current liabilities91,641 103,111 
Long-term debt (Note 7)89,403 91,752 
Deferred tax liabilities (Note 9)1,718 3,109 
Long-term portion of accrued settlement (Note 13)6,000 8,000 
Long-term operating lease liabilities12,669 14,163 
Other long-term liabilities7,545 7,577 
Stockholders’ equity:
Common stock, par value $0.01, authorized 20,000,000 shares; shares issued at June 30, 2023 and December 31, 2022, 11,115,779; shares outstanding at June 30, 2023 and December 31, 2022, 10,816,902 and 10,776,827, respectively111 111 
Paid-in capital40,919 41,303 
Retained earnings124,548 123,169 
Treasury stock - at cost, 298,877 and 338,952 common stock shares at June 30, 2023 and December 31, 2022, respectively(4,846)(6,240)
Accumulated other comprehensive loss(18,536)(21,165)
Total L.B. Foster Company stockholders’ equity142,196 137,178 
Noncontrolling interest396 420 
Total stockholders’ equity142,592 137,598 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$351,568 $365,310 
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

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L.B. FOSTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended
June 30,		Six Months Ended
June 30,
2023202220232022
Sales of goods$132,167 $116,584 $230,705 $201,005 
Sales of services15,867 14,931 32,817 29,304 
Total net sales148,034 131,515 263,522 230,309 
Cost of goods sold101,069 95,331 179,134 165,176 
Cost of services sold14,713 12,891 28,845 25,393 
Total cost of sales115,782 108,222 207,979 190,569 
Gross profit32,252 23,293 55,543 39,740 
Selling and administrative expenses24,528 19,394 45,951 36,692 
Amortization expense1,375 1,419 2,740 2,855 
Operating profit6,349 2,480 6,852 193 
Interest expense - net1,574 384 2,962 754 
Other expense (income) - net719 (701)2,546 (1,264)
Income before income taxes4,056 2,797 1,344 703 
Income tax expense563 821 22 313 
Net income3,493 1,976 1,322 390 
Net loss attributable to noncontrolling interest(38)(34)(57)(54)
Net income attributable to L.B. Foster Company$3,531 $2,010 $1,379 $444 
Basic earnings per common share$0.32 $0.18 $0.12 $0.04 
Diluted earnings per common share$0.32 $0.18 $0.12 $0.04 

  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)
(Unaudited)
(In thousands)
Three Months Ended
June 30,		Six Months Ended
June 30,
2023202220232022
Net income$3,493 $1,976 $1,322 $390 
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment1,252 (3,688)2,503 (4,568)
Unrealized gain on cash flow hedges, net of tax expense of $0, $50, $0, and $238, respectively496 147 78 698 
Cash flow hedges reclassified to earnings, net of tax expense of $0, $0, $0, and $66, respectively— — — 93 
Reclassification of pension liability adjustments to earnings, net of tax expense of $2, $16, $4, and $32, respectively*41 50 81 99 
Total comprehensive income (loss)5,282 (1,515)3,984 (3,288)
Less comprehensive (loss) income attributable to noncontrolling interest:
Net loss attributable to noncontrolling interest(38)(34)(57)(54)
Foreign currency translation adjustment29 (61)33 24 
Amounts attributable to noncontrolling interest(9)(95)(24)(30)
Comprehensive income (loss) attributable to L.B. Foster Company$5,291 $(1,420)$4,008 $(3,258)

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

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

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L.B. FOSTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Six Months Ended
June 30,
20232022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income$1,322 $390 
Adjustments to reconcile net income to cash used in operating activities:
Deferred income taxes(1,710)(173)
Depreciation4,989 3,814 
Amortization2,740 2,855 
Equity in income of nonconsolidated investments(16)(87)
Gain on sales and disposals of property, plant, and equipment(366)(214)
Stock-based compensation1,829 1,183 
Loss (gain) on asset divestitures3,074 (491)
Change in operating assets and liabilities:
Accounts receivable6,584 (17,327)
Contract assets(3,033)2,190 
Inventories(13,068)(10,695)
Other current assets(1,251)(3,573)
Other noncurrent assets(865)1,715 
Accounts payable465 9,347 
Deferred revenue627 5,301 
Accrued payroll and employee benefits(1,885)(2,943)
Accrued settlement(2,000)(2,000)
Other current liabilities(941)(1,748)
Other long-term liabilities172 (926)
Net cash used in operating activities(3,333)(13,382)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of property, plant, and equipment539 237 
Capital expenditures on property, plant, and equipment(1,495)(3,048)
Proceeds from business dispositions7,706 1,195 
Acquisitions, net of cash acquired966 (5,712)
Net cash provided by (used in) investing activities7,716 (7,328)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of debt(95,251)(78,093)
Proceeds from debt92,331 96,970 
Treasury stock acquisitions(977)(401)
Investment of noncontrolling interest334 — 
Net cash (used in) provided by financing activities(3,563)18,476 
Effect of exchange rate changes on cash and cash equivalents178 (477)
Net increase (decrease) in cash and cash equivalents998 (2,711)
Cash and cash equivalents at beginning of period2,882 10,372 
Cash and cash equivalents at end of period$3,880 $7,661 
Supplemental disclosure of cash flow information:
Interest paid$2,889 $662 
Income taxes (received) paid$(331)$389 


  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
(Unaudited)
(Dollars in thousands)
Three Months Ended June 30, 2023
Common
Stock		Paid-in
Capital		Retained
Earnings		Treasury
Stock		Accumulated Other
Comprehensive Loss		Noncontrolling
Interest		Total Stockholders’
Equity
Balance, March 31, 2023$111 $40,951 $121,017 $(5,174)$(20,296)$405 $137,014 
Net income (loss)— — 3,531 — — (38)3,493 
Other comprehensive income, net of tax:
Pension liability adjustment— — — — 41 — 41 
Foreign currency translation adjustment— — — — 1,223 29 1,252 
Unrealized derivative gain on cash flow hedges— — — — 496 — 496 
Purchase of 51,241 common shares for treasury— — — (662)— — (662)
Issuance of 58,432 common shares, net of shares withheld for taxes— (977)— 990 — — 13 
Stock-based compensation— 945 — — — — 945 
Balance, June 30, 2023$111 $40,919 $124,548 $(4,846)$(18,536)$396 $142,592 

Three Months Ended June 30, 2022
Common
Stock		Paid-in
Capital		Retained
Earnings		Treasury
Stock		Accumulated Other
Comprehensive Loss		Noncontrolling
Interest		Total Stockholders’
Equity
Balance, March 31, 2022$111 $42,153 $167,167 $(9,200)$(19,117)$583 $181,697 
Net income (loss)— — 2,010 — — (34)1,976 
Other comprehensive loss, net of tax:
Pension liability adjustment— — — — 50 — 50 
Foreign currency translation adjustment— — — — (3,627)(61)(3,688)
Unrealized derivative gain on cash flow hedges— — — — 147 — 147 
Issuance of 26,167 common shares, net of shares withheld for taxes— (877)— 809 — — (68)
Stock-based compensation— 925 — — — — 925 
Balance, June 30, 2022$111 $42,201 $169,177 $(8,391)$(22,547)$488 $181,039 

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


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L.B. FOSTER COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)
(Dollars in thousands)
Six Months Ended June 30, 2023
Common
Stock		Paid-in
Capital		Retained
Earnings		Treasury
Stock		Accumulated Other
Comprehensive Loss		Noncontrolling
Interest		Total Stockholders’
Equity
Balance, December 31, 2022$111 $41,303 $123,169 $(6,240)$(21,165)$420 $137,598 
Net income (loss)— — 1,379 — — (57)1,322 
Other comprehensive income, net of tax:
Pension liability adjustment— — — — 81 — 81 
Foreign currency translation adjustment— — — — 2,470 33 2,503 
Unrealized derivative gain on cash flow hedges— — — — 78 — 78 
Purchase of 51,241 common shares for treasury— — — (662)— — (662)
Issuance of 91,316 common shares, net of shares withheld for taxes— (2,213)— 2,056 — — (157)
Stock-based compensation— 1,829 — — — — 1,829 
Balance, June 30, 2023$111 $40,919 $124,548 $(4,846)$(18,536)$396 $142,592 

Six Months Ended June 30, 2022
Common
Stock		Paid-in
Capital		Retained
Earnings		Treasury
Stock		Accumulated Other
Comprehensive Loss		Noncontrolling
Interest		Total Stockholders’
Equity
Balance, December 31, 2021$111 $43,272 $168,733 $(10,179)$(18,845)$518 $183,610 
Net income (loss)— — 444 — — (54)390 
Other comprehensive (loss) income, net of tax:
Pension liability adjustment— — — — 99 — 99 
Foreign currency translation adjustment— — — — (4,592)24 (4,568)
Unrealized derivative gain on cash flow hedges— — — — 698 — 698 
Cash flow hedges reclassified to earnings— — — — 93 — 93 
Issuance of 60,607 common shares, net of shares withheld for taxes— (2,254)— 1,788 — — (466)
Stock-based compensation— 1,183 — — — — 1,183 
Balance, June 30, 2022$111 $42,201 $169,177 $(8,391)$(22,547)$488 $181,039 
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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L.B. FOSTER COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(Dollars in thousands, except share data)
Note 1. 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 108 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. The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. In the opinion of management, all estimates and adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. However, actualOperating results could differ from those estimates. The results of operations for interim periodsthe three and six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017. The year-end Condensed Consolidated Balance Sheet as of December 31, 2016 was derived from audited financial statements.2023. This Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in theL.B. Foster Company’s Annual Report on Form 10-K for the year ended December 31, 2016.2022. 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, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”), which supersedes the revenue recognition requirements in Accounting Standards Codification 605, “Revenue Recognition” (“ASC 605”). ASU 2014-09 is based on the principle that revenue is recognized to depict the transfer 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 from costs incurred to obtain or fulfill a contract. ASU 2014-09 is effective for fiscal years beginning after December 15, 2017, including interim periods within that reporting period. The Company continues 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, 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.

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 result in most leases being capitalized as a right of use asset with a related liability on our balance sheets. 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 in the process of analyzing the impact of ASU 2016-02 on our financial position. 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 to ASU 2016-02.

In October 2016, the FASB issued ASU 2016-16, “Income Taxes – Intra-Entity Transfers of Assets Other Than Inventory (Topic 740),” (“ASU 2016-16”) which will require an entity to recognize the income tax consequences 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 evaluate 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. The guidance requires that the entity report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period, and report the other components of net periodic pension cost and net

periodic postretirement benefit cost in the income statement separately from the service cost component and outside a subtotal 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. The Company is evaluating its implementation approach and assessing the impact of ASU 2017-07 on the presentation of operations.
2. BUSINESS SEGMENTSBusiness Segments
The Company is a leading manufacturer and distributorglobal technology solutions provider of engineered, manufactured products and services for transportationthat builds and energy infrastructure withsupports infrastructure. The Company’s innovative engineering and product development solutions address the safety, reliability, and performance needs of its customers’ most challenging requirements. The Company maintains locations in North America, South America, Europe, and Europe.Asia. The Company is organized and evaluated by product group, which is the basis for identifying reportable segments. Each segment represents a revenue-producing componentCompany’s segments represent components of the Company (a) that engage in activities from which revenue is generated and expenses are incurred, (b) whose operating results are regularly reviewed by the Chief Operating Decision Maker, who uses such information to make 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’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 are described in 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, 2022.


The following table illustrates revenues and profits (losses) from operationsoperating results of the Company by segmentCompany’s reportable segments were as follows for the periods indicated:presented:
Three Months Ended
June 30, 2023		Three Months Ended
June 30, 2022
Net SalesSegment Operating ProfitNet SalesSegment Operating Profit (Loss)
Rail, Technologies, and Services$91,616 $6,627 $81,797 $3,998 
Precast Concrete Products33,865 1,296 23,611 (125)
Steel Products and Measurement22,553 1,456 26,107 762 
Total$148,034 $9,379 $131,515 $4,635 
  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

Six Months Ended
June 30, 2023		Six Months Ended
June 30, 2022
Net SalesSegment Operating ProfitNet SalesSegment Operating Profit (Loss)
Rail, Technologies, and Services$156,000 $9,015 $145,507 $5,037 
Precast Concrete Products58,153 948 38,621 (916)
Steel Products and Measurement49,369 1,448 46,181 (1,386)
Total$263,522 $11,411 $230,309 $2,735 
  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 measurementbusiness 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 the segments.


9
Table of segment profit (loss) from operations since December 31, 2016. The internal cost of capital charges are eliminated during the consolidation process.Contents

The following table provides aA reconciliation of reportable segment net profit (loss) from operations to the Company’s consolidated total:
total for the periods presented:
  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
June 30,		Six Months Ended
June 30,
2023202220232022
Operating profit for reportable segments$9,379 $4,635 $11,411 $2,735 
Interest expense - net(1,574)(384)(2,962)(754)
Other (expense) income - net(719)701 (2,546)1,264 
Unallocated corporate expenses and other unallocated charges(3,030)(2,155)(4,559)(2,542)
Income before income taxes$4,056 $2,797 $1,344 $703 


The following table illustrates assets of the Company by segment:reportable segment for the periods presented:
June 30,
2023		December 31,
2022
Rail, Technologies, and Services$177,515 $172,111 
Precast Concrete Products104,892 108,598 
Steel Products and Measurement38,492 54,516 
Unallocated corporate assets30,669 30,085 
Total$351,568 $365,310 

On June 30, 2023, the Company sold substantially all the operating assets of the prestressed concrete railroad tie business operated by its wholly-owned subsidiary, CXT Incorporated (“Ties”), located in Spokane, WA, for $2,368 in proceeds, subject to final working capital adjustments, generating a $1,009 loss on the sale, which was recorded in “Other expense (income) - net”. The Ties business was reported in the Rail Products business unit within the Rail, Technologies, and Services segment.

On March 30, 2023, the Company sold substantially all the operating assets of its Chemtec Energy Services LLC business (“Chemtec”) for $5,344 in proceeds, subject to final working capital adjustments, generating a $2,065 loss on the sale, which was recorded in “Other expense (income) - net.” The Chemtec business was reported in the Coatings and Measurement business unit within the Steel Products and Measurement segment.
Note 3. Revenue
The following table summarizes the Company’s net sales by major product and service category for the periods presented:
Three Months Ended
June 30,		Six Months Ended
June 30,
2023202220232022
Rail Products and Global Friction Management$81,926 $70,416 $137,974 $122,067 
Technology Services and Solutions9,690 11,381 18,026 23,440 
Rail, Technologies, and Services91,616 81,797 156,000 145,507 
Precast Concrete Buildings19,325 15,811 30,211 25,781 
Precast Infrastructure Products14,540 7,800 27,942 12,840 
Precast Concrete Products33,865 23,611 58,153 38,621 
Fabricated Steel Products14,854 17,967 25,371 30,571 
Coatings and Measurement7,699 8,140 23,998 15,610 
Steel Products and Measurement22,553 26,107 49,369 46,181 
Total net sales$148,034 $131,515 $263,522 $230,309 

The majority of the Company’s revenue is from products transferred and services rendered to customers at a point in time. 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 a designated physical location.





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Table of Contents
  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
Net sales by the timing of the transfer of goods and services was as follows for the periods presented:
Three Months Ended June 30, 2023
Rail, Technologies, and ServicesPrecast Concrete ProductsSteel Products and MeasurementTotal
Point in time$75,923 $14,540 $20,407 $110,870 
Over time15,693 19,325 2,146 37,164 
Total net sales$91,616 $33,865 $22,553 $148,034 
Three Months Ended June 30, 2022
Rail, Technologies, and ServicesPrecast Concrete ProductsSteel Products and MeasurementTotal
Point in time$65,872 $8,577 $20,964 $95,413 
Over time15,925 15,034 5,143 36,102 
Total net sales$81,797 $23,611 $26,107 $131,515 
3. GOODWILL AND OTHER INTANGIBLE ASSETS
Six Months Ended June 30, 2023
Rail, Technologies, and ServicesPrecast Concrete ProductsSteel Products and MeasurementTotal
Point in time$129,757 $27,942 $36,133 $193,832 
Over time26,243 30,211 13,236 69,690 
Total net sales$156,000 $58,153 $49,369 $263,522 
Six Months Ended June 30, 2022
Rail, Technologies, and ServicesPrecast Concrete ProductsSteel Products and MeasurementTotal
Point in time$115,038 $12,840 $36,026 $163,904 
Over time30,469 25,781 10,155 66,405 
Total net sales$145,507 $38,621 $46,181 $230,309 

The Company’s performance obligations under long-term agreements with its customers are generally satisfied over time. Revenue under long-term agreements is at times recognized 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 its performance to date under the terms of the contract. The Company’s revenue recognized over time under long-term agreements is also at times recognized using an output method, specifically units delivered, based upon certain customer acceptance and delivery requirements. The use of an input or an output measure to recognize revenue is determined based on what is most appropriate given the nature of the work performed and terms of the associated agreement.

Revenue recognized over time was as follows for the periods presented:
Three Months Ended
June 30,		Percentage of Total Net Sales
Three Months Ended June 30,
2023202220232022
Over time input method$15,724 $20,089 10.6 %15.3 %
Over time output method21,440 16,013 14.5 12.2 
Total over time sales$37,164 $36,102 25.1 %27.5 %

Six Months Ended
June 30,		Percentage of Total Net Sales
Six Months Ended June 30,
2023202220232022
Over time input method$31,935 $39,411 12.1 %17.1 %
Over time output method37,755 26,994 14.3 11.7 
Total over time sales$69,690 $66,405 26.4 %28.8 %

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

The following table sets forth the Company’s contract assets:
Contract Assets
Balance as of December 31, 2022$33,613 
Net additions to contract assets4,797 
Transfers from contract asset balance to accounts receivable(4,399)
Balance as of June 30, 2023$34,011 

The following table sets forth the Company’s contract liabilities:
Contract Liabilities
Balance as of December 31, 2022$6,781 
Revenue recognized from contract liabilities(4,049)
Increase in billings in excess of cost, excluding revenue recognized3,525 
Other adjustments, including business divestiture(1,938)
Balance as of June 30, 2023$4,319 

The Company records provisions related to the allowance for credit losses associated with contract assets. Provisions are recorded based upon a specific review of individual contracts as necessary, and a standard provision over any remaining contract assets pooled together based on similar risk of credit loss. The development of these provisions is based on historical collection trends, accuracy of estimates within contract margin reporting, as well as the expectation that collection patterns and margin reporting will continue to adhere to patterns observed in recent years. These expectations are formed based on trends observed, as well as current and expected future conditions.

As of June 30, 2023, the Company had approximately $290,076 of obligations under new contracts and remaining performance obligations, which is also referred to as backlog. Approximately 12.0% of the June 30, 2023 backlog was related to projects that are anticipated to extend beyond June 30, 2024.
Note 4. Goodwill and Other Intangible Assets
The following table presents the changes in goodwill balance by reportable segment:segment for the period presented:
  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

Rail, Technologies, and ServicesPrecast Concrete ProductsSteel Products and MeasurementTotal
Balance as of December 31, 2022$19,948 $10,785 $— $30,733 
VanHooseCo acquisition— 242 — 242 
Foreign currency translation impact429 — — 429 
Balance as of June 30, 2023$20,377 $11,027 $— $31,404 
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.amount, which included the impacts of current economic conditions, including but not limited to labor markets, supply chains, and other inflationary costs. However, these factors can be unpredictable and are subject to change. 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 recoverabilityas a result of the long-lived assets associated with certain reporting unitsevaluation of the Company and the long-term financialqualitative factors as of June 30, 2023. However, future impairment charges could result if future projections of the businesses. Sustained declinesdiverge unfavorably from current expectations in the markets we serve may result in future long-lived asset impairment.Rail Technologies and Precast Concrete Products reporting units.


The following table represents the gross other intangible assets balance by reportable segment:






12
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  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

TheAs of June 30, 2023 and December 31, 2022, the components of the Company’s intangible assets arewere as follows:
June 30, 2023
Weighted Average
Amortization
Period In Years		Gross
Carrying
Value		Accumulated
Amortization		Net
Carrying
Amount
Patents10$338 $(197)$141 
Customer relationships1627,656 (15,828)11,828 
Trademarks and trade names167,983 (4,299)3,684 
Technology1432,306 (26,978)5,328 
Favorable lease6327 (52)275 
$68,610 $(47,354)$21,256 

During the six months ended June 30, 2023, certain fully amortized intangible assets of $28 related to non-compete agreements were eliminated from gross intangible assets and accumulated amortization.

December 31, 2022
Weighted Average
Amortization
Period In Years		Gross
Carrying
Value		Accumulated
Amortization		Net
Carrying
Amount
Non-compete agreements1$27 $(16)$11 
Patents10330 (187)143 
Customer relationships1627,184 (14,129)13,055 
Trademarks and trade names167,933 (3,989)3,944 
Technology1432,201 (25,827)6,374 
Favorable lease6327 (23)304 
$68,002 $(44,171)$23,831 

On June 21, 2022, the Company acquired the stock of Skratch Enterprises Ltd. (“Skratch”). On August 12, 2022, the Company acquired the operating assets of VanHooseCo Precast LLC (“VanHooseCo”). As of June 30, 2023, the purchase accounting for these transactions is final.
Note 5. Accounts Receivable
  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 assetsChanges in reserves for uncollectible accounts, which are amortized over their useful lives, which range from 4 to 25 years, with a total weighted average amortization periodrecorded as part of approximately 15 years at September 30, 2017. Amortization“Selling and administrative expenses” in the Condensed Consolidated Statements of Operations, were recorded as an expense of $256 and $150 for the three months ended SeptemberJune 30, 20172023 and 2016 was $1,7642022, respectively, and $1,763, respectively. Amortizationan expense of $411 and $211 for the ninesix months ended SeptemberJune 30, 20172023 and 2016 was $5,218 and $7,818,2022, respectively.


Estimated amortization expense forThe Company establishes the remainder of 2017 and thereafter is as follows:
 Amortization Expense
2017$1,782
20187,024
20196,302
20205,980
20215,960
2022 and thereafter32,087
 $59,135
4. 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 amounts of trade accounts receivable at September 30, 2017 and December 31, 2016 have been reduced by an allowance for doubtful accountscredit losses based on historical collection patterns and other subjective conditions as necessary, including current and expected market conditions. Trade receivables are pooled based on age, which groups receivables of $2,138similar credit risk together. Management maintains stringent credit review practices and $1,417, respectively.works to maintain positive customer relationships to further mitigate credit risk.


5. INVENTORIESThe following table sets forth the Company’s allowance for credit losses:
Inventories at September 30, 2017 and December 31, 2016 are summarized in the following table:
Allowance for Credit Losses
Balance as of December 31, 2022$813 
Current period provision411 
Write-off against allowance(197)
Balance as of June 30, 2023$1,027 
13
  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
Table of Contents

Note 6. Inventory
Inventory is generally valued at the lower of last-in, first-out (“LIFO”) cost or market. Other inventories of the Company are valued at average cost or net realizable value, whichever is lower. An actual valuationThe Company’s components of inventory under the LIFO method is made at the endas of each year based on the inventory levels 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 EQUIPMENT
Property, plant, and equipment at SeptemberJune 30, 20172023 and December 31, 2016 consist2022 are summarized in the following table:
June 30,
2023		December 31,
2022
Finished goods$48,237 $41,431 
Work-in-process5,304 9,693 
Raw materials25,910 24,597 
Inventories - net$79,451 $75,721 

Note 7. Long-Term Debt and Related Matters
Long-term debt consisted of the following:
June 30,
2023		December 31,
2022
Revolving credit facility$89,280 $91,567 
Finance leases and financing agreements225 312 
Total89,505 91,879 
Less current maturities(102)(127)
Long-term portion$89,403 $91,752 
  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

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 nine months ended September 30, 2017.

Depreciation expense for the three-month periods ended September 30, 2017 and 2016 was $3,178 and $3,295, respectively. For the nine-month periods ended September 30, 2017 and 2016, depreciation expense was $9,705 and $10,620, respectively.
7. INVESTMENTS
The Company is a member of a joint venture, L B Pipe & Coupling Products, LLC (“L B Pipe JV”), in which it maintains a 45% ownership interest. L B Pipe JV manufactures, markets, and sells various machined components and precision coupling products for the energy, water well, and construction markets and is scheduled to terminate on June 30, 2019.

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 beneficiary of the variable interest entity, 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 performance of L B Pipe JV.

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 investment of $4,288 as a current asset held for sale 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 amount of $413 was recorded 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 $276 for the three months ended September 30, 2017 and 2016, respectively. For the nine months ended September 30, 2017 and 2016, 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 and December 31, 2016, respectively, are as follows:
  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 States
Long-term debt consists of the following:
  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,August 13, 2021, the Company, its domestic subsidiaries, and certain of its Canadian and United Kingdom subsidiaries (collectively, the “Borrowers”), entered into the Second Amendment (the “Second Amendment”) to the SecondFourth 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“Credit Agreement”), with PNC Bank, N.A., Citizens Bank, N.A., Wells Fargo Bank, National Association, Bank of America, N.A., Wells Fargoand BMO Harris Bank, N.A., Citizens Bank of Pennsylvania, and Branch Banking and Trust Company. This Second Amendment modified the Amended and RestatedNational Association. The Credit Agreement, which had a maximumas amended, modifies the prior revolving credit linefacility, as amended, on terms more favorable to the Company and extends the maturity from April 30, 2024 to August 13, 2026. The Credit Agreement provides for a five-year, revolving credit facility that permits aggregate borrowings of $275,000.the Borrowers up to $130,000 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 Credit Agreement’s incremental loan feature permits the Company to increase the available commitments under the facility by up to an additional $50,000 subject to the Company’s receipt of increased commitments from existing or new lenders and the satisfaction of certain conditions.

Borrowings under the Credit Agreement as amended, will bear interest at rates based upon either the base rate or SOFR rate plus applicable margins. The Credit Agreement includes two financial covenants: (a) Maximum Gross Leverage Ratio, defined as the Company’s consolidated Indebtedness (as defined in the Credit Agreement) 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 (as defined in the Credit Agreement), and (ii) 3.50 to 1.00 for all testing periods occurring during an Acquisition Period, and (b) Minimum Consolidated Fixed Charge Coverage Ratio, defined as the Company’s consolidated EBITDA divided by the Company’s Fixed Charges (as defined in the Credit Agreement), which must be more than 1.05 to 1.00.

On August 12, 2022, the Company entered into a second amendment to its Credit Agreement (“Second Amendment”) to obtain approval for the acquisition of VanHooseCo Precast, LLC (“VanHooseCo”) and temporarily modify certain financial covenants to accommodate the transaction. The Second Amendment reducedpermitted the permitted revolving credit borrowingsCompany to $195,000acquire the operating assets of VanHooseCo and provided

for additional term loan borrowing 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,modified 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 covenant (“Minimum EBITDA”). For the quarter ended December 31, 20163.50 through the quarter ended June 30, 2017,2023 to accommodate the Minimum EBITDA had to be at least $18,500. For each quarter thereafter, through the quarter endingtransaction.

As of June 30, 2018,2023, the Minimum EBITDA requirement will increase by various increments. The incremental Minimum EBITDA requirement for the period ended September 30, 2017 was at least $23,000. 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 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 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.

At September 30, 2017, 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 definedcovenants 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 loansCredit Agreement, as amended, 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.

At September 30, 2017, L.B. Foster had outstanding letters of credit of approximately $425 and had net available borrowing capacity$1,173.
14
Table of $46,081. The maturity date of the facility is March 13, 2020.

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). 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 interest rate on this facility is the financial institution’s base rate plus 2.50%. 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. There was approximately $999 in outstanding guarantees (as defined in the underlying agreement) at September 30, 2017. This credit facility was renewed and amended during the fourth quarter of 2016 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. The subsidiary had available borrowing capacity of $1,011 at September 30, 2017.

9. 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, the interest rate swaps were recorded within other accrued liabilities.
Contents
  Fair Value Measurements at Reporting Date and Using Fair Value Measurements at Reporting Date and Using
  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)
Term deposits $17
 $17
 $—
 $—
 $16
 $16
 $—
 $—
Total assets $17
 $17
 $—
 $—
 $16
 $16
 $—
 $—
Interest rate swaps $323
 $—
 $323
 $—
 $334
 $—
 $334
 $—
Total liabilities $323
 $—
 $323
 $—
 $334
 $—
 $334
 $—

The interest rate swaps are accounted for as fair value hedges and substantially offset the changes in fair value of the hedged portion of the underlying debt that are attributable to the changes in market risk. Therefore, the gains and losses related to changes in the fair value of the interest rate swaps are included in interest income or expense, in our Condensed Consolidated Statements of Operations. For the three months ended September 30, 2017, interest expense from interest rate swaps was $98. For the nine months ended September 30, 2017, interest expense from interest rate swaps was $302.

In accordance with the provisions of ASC 820, "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 SHARE8. 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
June 30,		Six Months Ended
June 30,
2023202220232022
Numerator for basic and diluted earnings per common share:
Net income$3,493 $1,976 $1,322 $390 
Denominator:
Weighted average shares outstanding10,807 10,715 10,800 10,700 
Denominator for basic earnings per common share10,807 10,715 10,800 10,700 
Effect of dilutive securities:
Stock compensation plans71 99 66 109 
Dilutive potential common shares71 99 66 109 
Denominator for diluted earnings per common share - adjusted weighted average shares outstanding10,878 10,814 10,866 10,809 
Basic earnings per common share$0.32 $0.18 $0.12 $0.04 
Diluted earnings per common share$0.32 $0.18 $0.12 $0.04 
Note 9. Income Taxes
  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 34For the three months ended June 30, 2023 and 80 anti-dilutive shares during2022, the three-Company recorded an income tax expense of $563 and nine-month periods$821, respectively, on pre-tax income of $4,056 and $2,797, respectively, for an effective income tax rate of 13.9% and 29.4%, respectively. For the six months ended SeptemberJune 30, 2016,2023 and 2022, the Company recorded an income tax expense of $22 and $313, respectively, excludedon pre-tax income of $1,344 and $703, respectively, for an effective income tax rate of 1.6% and 44.5%, respectively. The Company's effective income tax rate for the three and six months ended June 30, 2023 differed from the above calculation.federal statutory rate of 21% primarily due to the realization of a portion of its U.S. deferred tax assets previously offset by a valuation allowance. The Company continues 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 pre-tax income projections, combined with the seasonal nature of our businesses, could also impact the effective income tax rate each quarter.
11. STOCK-BASED COMPENSATIONNote 10. Stock-Based Compensation
The Company applies the provisions of FASB ASC 718, “Compensation – Stock Compensation,” to account for the Company’srecorded 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$945 and $320$925 for the three-month periodsthree months ended SeptemberJune 30, 20172023 and 2016,2022, respectively, and $1,829 and $1,183 for the six months ended June 30, 2023 and 2022, respectively, related to fully-vested stock awards, restricted stock awards and performance unit awards. Stock compensation expenseAs of $1,228 and $875 was recorded for the nine-month periods ended SeptemberJune 30, 2017 and 2016, respectively. At September 30, 2017,2023, unrecognized compensation expense for awards that the Company expects to vest approximated $4,140.$7,026. The Company will recognize this unrecognized compensation expense over the upcoming 3.52.7 years through March 2021.2026.


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, AwardsPerformance Share Units, and Performance UnitPerformance-Based Stock Awards
Under the 2022 Equity and Incentive Compensation Plan, successor to 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-year period, unless indicated otherwise by the underlying restricted stock award agreement. Awards of restricted stock are subject to a minimum one-year vesting period, including those granted to non-employee directors. Performance unit awardsshare units are offered annually under separate three-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. The Company has, on occasion, issued performance share units with longer performance periods as incentivization and retention tools. 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 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
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separation from their service on the Board. DuringBoard of Directors. Since 2018, no non-employee directors have elected the quarter ended March 31, 2017,option to receive deferred stock units of the Company’s common stock in lieu of director cash compensation.

In February 2023, the Compensation Committee approved the 2017 Performance Share Unit Program2023-2025 Long Term Incentive Plan which includes grants of performance share units 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 2014 Performance Share Unit Program. Actual performance resulted in no payout relative to the 2014 Performance Share Unit Program target performance metrics.

restricted stock. The following table summarizes the restricted stock, award, deferred stock award,units, and performanceperformance-based stock and share unit award activity for the periodsix months ended SeptemberJune 30, 2017:2023:
Restricted
Stock		Deferred
Stock Units		Performance-Based Stock
and Share Units		Weighted Average
Grant Date Fair Value
Outstanding as of December 31, 2022174,173 46,268 108,478 $17.77 
Granted181,914 — 367,558 11.78 
Vested(88,367)(33,864)— 15.97 
Adjustment for incentive awards expected to vest— — 20,104 15.36 
Outstanding as of June 30, 2023267,720 12,404 496,140 $14.44 
Note 11. Fair Value Measurements
The Company determines the fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy includes three levels of inputs that may be used to measure fair value as described below:

Level 1: Observable inputs that reflect unadjusted quoted market prices in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
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 in “Cash and cash equivalents” within the Condensed Consolidated Balance Sheets are investments in non-domestic term deposits. The carrying amounts approximate fair value because of the short maturity of the instruments.

SOFR-based interest rate swaps - To reduce the impact of interest rate changes on outstanding variable-rate debt, the Company amended and entered into forward-starting SOFR-based interest rate swaps with notional values totaling $20,000 and $20,000 effective August 12, 2022 and August 31, 2022, respectively. The fair value of the interest rate swaps are 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. As of June 30, 2023 and December 31, 2022, the interest rate swaps were recorded in “Other current assets” when the interest rate swaps’ fair market value are in an asset position, and "Other accrued liabilities" when in a liability position within our Condensed Consolidated Balance Sheets.
Fair Value Measurements at Reporting DateFair Value Measurements at Reporting Date
June 30,
2023		Level 1Level 2Level 3December 31,
2022		Level 1Level 2Level 3
Term deposits$17 $17 $— $— $17 $17 $— $— 
Interest rate swaps2,008 — 2,008 — 1,930 — 1,930 — 
Total assets$2,025 $17 $2,008 $— $1,947 $17 $1,930 $��� 

The $20,000 interest rate swap agreements that became effective August 2022 are accounted for as cash flow hedges and the objective of the hedges is to offset the expected interest variability on payments associated with the interest rate on our debt. The gains and losses related to the interest rate swaps are reclassified from “Accumulated other comprehensive loss” in our Condensed Consolidated Balance Sheets and included in “Interest expense - net” in our Condensed Consolidated Statements of Operations as the interest expense from our debt is recognized.

For the three months ended June 30, 2023 and 2022, the Company recognized interest income of $295 and $19, respectively, from interest rate swaps. For the six months ended June 30, 2023 and 2022, the Company recognized interest income and interest expense of $540 and $78, respectively, from interest rate swaps.

16
Table of Contents
  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
Note 12. RETIREMENT PLANSRetirement 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, as amended (“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 twoone defined contribution plansplan for its employees in Canada, as well as a post-retirement benefit plan.Canada. In the United Kingdom, Rail Technologiesthe Company maintains two defined contribution plans and a defined benefit plan.plan, which is frozen. These plans are discussed in further detail below.



United States Defined Benefit PlansPlan
Net periodic pension costs for the United States defined benefit pension plansplan for the three-three and nine-month periodssix months ended SeptemberJune 30, 20172023 and 2016 are2022 were as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
2023202220232022
Interest cost$71 $49 $143 $97 
Expected return on plan assets(64)(66)(128)(132)
Recognized net actuarial loss16 18 31 35 
Net periodic pension cost$23 $1 $46 $— 
  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 contributehas made contributions to its United States defined benefit plans in 2017.plan of $176 during the six months ended June 30, 2023 and expects to make total contributions of $400 during 2023.


United Kingdom Defined Benefit PlansPlan
Net periodic pension costs for the United Kingdom defined benefit pension plan for the three-three and nine-month periodssix months ended SeptemberJune 30, 20172023 and 2016 are2022 were as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
2023202220232022
Interest cost$56 $43 $112 $86 
Expected return on plan assets(84)(76)(168)(152)
Amortization of prior service costs and transition amount6 6 12 12 
Recognized net actuarial loss3 40 6 80 
Net periodic pension (income) cost$(19)$13 $(38)$26 
  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


United Kingdom regulations require trustees to adopt a prudent approach to funding required contributions to defined benefit pension plans. EmployerFor the six months ended June 30, 2023, the Company contributed approximately $170 to the plan. The Company anticipates total contributions of approximately $251 are anticipated$340 to the United Kingdom Rail Technologies pension plan during 2017. For the nine months ended September 30, 2017, the Company contributed approximately $188 to the plan.2023.


Defined Contribution Plans
The Company sponsors eightfive defined contribution plans for hourly and salaried employees across ourits domestic and international facilities. The following table summarizes the expense associated with the contributions made to these plans.plans for the periods presented:
Three Months Ended
June 30,		Six Months Ended
June 30,
2023202220232022
United States$793 $390 $1,407 $695 
Canada32 45 94 105 
United Kingdom315 379 576 379 
$1,140 $814 $2,077 $1,179 
17
  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
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Note 13. COMMITMENTS AND CONTINGENT LIABILITIESCommitments 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 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 claimthen-pending 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 and has been purchasing 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 provisions in the supply agreement have failedservices, targeting $8,000 of their essential purpose which entitles UPRR to recover all incidental and consequential damages. The Complaint seeks to cancel all dutiesannual purchases per year beginning March 13, 2019, per letters of UPRRintent under the contract, to adjudgeSettlement Agreement. During the Company as having no remaining rights under the contracts, and to recover damagesthird quarter of 2021, 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. The amended 2005 supply agreement provides that UPRR’s exclusive remedy is to receive 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 thatconnection with the Company’s warranty does not apply to ties that (a)divestiture of its Piling Products division, the targeted annual purchases per year have been repaired or altered without the Company’s written consent in suchreduced to $6,000 for 2021 through 2024. The Settlement Agreement also includes 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 results of operations, financial condition,year ending December 31, 2023 and cash flows.thereafter are as follows:

Year Ending December 31,
Remainder of 2023$6,000 
20248,000 
Total$14,000 
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. More than 140 other companies received such a notice. The Company and a predecessor owned and operated a facility near the harbor site for a period prior to 1982. The net present value and undiscounted costs of the selected remedy throughout the harbor site are estimated by the EPA to be approximately $1.1 billion and $1.7 billion, respectively, and the remedial work is expected to take as long as 13 years to complete. These costs may increase given that the remedy will not be initiated or completed for several years. The Company is reviewing the basis for its identification by the EPA and the nature of the historic operations of an L.B. Fostera Company predecessor onnear the site. ManagementAdditionally, the Company executed a PRP agreement which provides for a private allocation process among almost 100 PRPs in a working group whose work is ongoing and involves a process that will ultimately conclude a proposed allocation of liability for cleanup of the site and various sub-areas. The Company does not have any individual risk sharing agreements in place with respect to the site, and was only associated with the site from 1976 to when it purchased the stock of a company whose assets it sold in 1982 and which was dissolved in 1994. On March 26, 2020, the EPA issued a Unilateral Administrative Order to two parties requiring them to perform remedial design work for that portion of the Harbor Superfund Site that includes the area closest to the facility; the Company was not a recipient of this Unilateral Administrative Order. The Company cannot predict the ultimate impact of these proceedings because of the large number of PRPs involved throughout the harbor site, the size and extent of the site, the degree of contamination of various wastes, varying environmental impacts throughout the harbor site, the scarcity of data related to the facility once operated by the Company and a predecessor, potential comparative liability between the allocation parties and regarding non-participants, and the speculative nature of the remediation costs. Based upon information currently available, management does not believe that the Company’s alleged PRP status regarding the Portland Harbor Superfund Site or other 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 As more information develops and the allocation process is completed, and given the resolution of factors like those described above, an unfavorable resolution could have a material adverse effect. As of June 30, 20172023 and December 31, 2016,2022, the Company maintained environmental reserves approximating $6,255$2,447 and $6,270,$2,472, respectively. The following table sets forth the Company’s environmental obligation:

18
 Environmental liability
Balance at December 31, 2016$6,270
Additions to environmental obligations7
Environmental obligations utilized(22)
Balance at September 30, 2017$6,255
Table of Contents

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'smanagement’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'sCompany’s financial position or liquidity at Septemberas of June 30, 2017.2023.


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'sCompany’s assessment at Septemberas of June 30, 2017,2023, no such disclosures were considered necessary.
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14. INCOME TAXES
For the three months ended September 30, 2017 and 2016, the Company recorded an income tax benefitTable of $208 on pretax income of $3,014 and $3,379 on pretax losses of $9,361, respectively, for an effective income tax rate of (6.9)% 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%, 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 during the third quarter 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 pretax income projections and the mix of income across jurisdictions could also impact the effective tax rate.Contents
15. SUBSEQUENT EVENTS
Management evaluated all 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.

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 management’s current expectations and assumptions about future events that involve inherent risks and uncertainties and may concern, among other things, L.B. Fosterthe Company’s (the “Company”) expectations relating to our strategy, goals, projections, and plans regarding our financial position, liquidity, capital resources, and results of operations; the outcome of litigationoperations 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: any future global health crises, and the related social, regulatory, and economic impacts and the response thereto by the Company, our employees, our customers, and national, state, or local governments; a continuation or worsening of the adverse economic conditions in the markets we serve, including recession, the continued volatility in the prices for oil and gas, governmental travel restrictions, project delays, and budget shortfalls, or otherwise; volatility in the global capital markets, including interest rate fluctuations, which could adversely affect our ability to access the capital markets on terms that are favorable to us; restrictions on our ability to draw on our credit agreement, including as a result of any future inability to comply with restrictive covenants contained therein; a decrease in freight or transit rail traffic; environmental matters, including any costs associated with any remediation and monitoring; a resumptionmonitoring of the economic slowdown we have experienced in the previous two years in the markets we serve;such matters; the risk of doing business in international markets;markets, including compliance with anti-corruption and bribery laws, foreign currency fluctuations and inflation, and trade restrictions or embargoes; our ability to effectuate our strategy, including cost reduction initiatives, and our ability to effectively integrate acquired businesses or to divest businesses, such as the recent dispositions of the Track Components, Chemtec, and Ties businesses, and acquisitions of the Skratch Enterprises Ltd., Intelligent Video Ltd., and VanHooseCo Precast LLC businesses and to 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'customers’ concerns about conflict minerals; labor disputes; cyber-security risks such as data security breaches, malware, ransomware, “hacking,” and identity theft, which could disrupt our business and may result in misuse or misappropriation of confidential or proprietary information, and could result in the disruption or damage to our systems, increased costs and losses, or an adverse effect to our reputation; the continuing effectiveeffectiveness of our ongoing 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 any new credit agreement, and reforms regarding the use of SOFR 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;taxes; 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; sustained declinesgeopolitical conditions, including the conflict in energy prices;Ukraine; 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.litigation and the outcome of litigation and product warranty claims. 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 andfor the year ended December 31, 2022, or as updated and/or amended by our other current or periodic filings 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.


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Table of Contents
General Overview and Business Update
Results of the Quarter
Three Months Ended
June 30,		Percent
Change		Percent of Total Net Sales
Three Months Ended
June 30,
202320222023 vs. 202220232022
Net sales$148,034 $131,515 12.6 %100.0 %100.0 %
Gross profit32,252 23,293 38.5 21.8 17.7 
Expenses:
Selling and administrative expenses24,528 19,394 26.5 16.6 14.7 
Amortization expense1,375 1,419 (3.1)0.9 1.1 
Operating profit6,349 2,480 156.0 4.3 1.9 
Interest expense - net1,574 384 **1.1 0.3 
Other expense (income) - net719 (701)202.6 0.5 (0.5)
Income before income taxes4,056 2,797 45.0 2.7 2.1 
Income tax expense563 821 (31.4)0.4 0.6 
Net income3,493 1,976 76.8 2.4 1.5 
Net loss attributable to noncontrolling interest(38)(34)11.8 (0.0)(0.0)
Net income attributable to L.B. Foster Company$3,531 $2,010 75.7 %2.4 %1.5 %
Diluted earnings per common share$0.32 $0.18 
** Results of the calculation are not considered meaningful for presentation purposes.

L.B. Foster Company (the “Company”) is a leading manufacturer and distributorglobal technology solutions provider of engineered, manufactured products and services forthat builds and supports infrastructure. The Company’s innovative engineering and product development solutions address the transportationsafety, reliability, and energy infrastructure withperformance needs of its customers’ most challenging requirements. The Company maintains locations in North America, South America, Europe, and Europe.Asia. The Company is comprised oforganized and operates in three businessreporting segments: Rail, Technologies, and Services, Precast Concrete Products, and Services, ConstructionSteel Products and TubularMeasurement.
Acquisition and Divestiture Summary
On June 21, 2022, the Company acquired the stock of Skratch Enterprises Ltd. (“Skratch”) for $7,402, which is inclusive of deferred payments withheld by the Company of $1,228, to be paid over the next four years or utilized to satisfy post-closing working capital adjustments or indemnity claims under the purchase agreement. Skratch is an industry leader in digital system integration with expertise in advanced digital display technologies and capabilities currently serving retail markets in the U.K. Skratch is reported within the Technology Services and Solutions business unit in the Rail, Technologies, and Services segment.

On August 1, 2022, the Company sold substantially all the operating assets of its Track Components business. Cash proceeds from the transaction were $7,795, subject to indemnification obligations and working capital adjustments and a loss on sale of $467 was recorded in “Other expense (income) - net.” The Track Components business was reported in the Rail Products business unit within the Rail, Technologies, and Services segment.

On August 12, 2022, the Company acquired the operating assets of VanHooseCo Precast, LLC (“VanHooseCo”), a business specializing in precast concrete walls, water management products, and forms for the commercial and residential infrastructure markets for $52,146 net of cash acquired. VanHooseCo has been included in the Company’s Precast Concrete Products segment.

On March 30, 2023, the Company sold substantially all the operating assets of its Chemtec Energy Services.Services LLC (“Chemtec”) business for $5,344 in proceeds, subject to final working capital adjustments, generating a $2,065 loss on sale, recorded in “Other expense (income) - net.” The Chemtec business was reported in the Coatings and Measurement business unit within the Steel Products and Measurement segment.


Quarter-to-Date Results
The segment gross profit measures presented within Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") tables constitute non-GAAP financial measures disclosed by management to provide investors and other users information to evaluateOn June 30, 2023, the performanceCompany sold substantially all the operating assets of the Company’s segments onprestressed concrete railroad tie business operated by its wholly-owned subsidiary, CXT Incorporated (“Ties”), located in Spokane, WA, for $2,368 in proceeds, subject to final working capital adjustments, generating 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$1,009 loss on the strength or weaknesssale, which was recorded in “Other expense (income) - net”. The Ties business was reported in the Rail Products business unit within the Rail, Technologies, and Services segment.


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Table 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.
Contents
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
Results Summary

      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.

Third Quarter 2017 Compared to Third Quarter 2016 – Company Analysis
Net sales of $131,492$148,034 for the periodthree months ended SeptemberJune 30, 20172023 increased by $16,848,$16,519, or 14.7%12.6%, compared toover the prior year quarter. The change was attributablein sales is due in part to increasesthe acquisitions of 32.3%, 12.2%,Skratch and 9.1%,VanHooseCo offset by the divestiture of the Track Components and Chemtec businesses. Organic growth and acquisitions drove a 13.3% and 6.0% increase in Tubular and Energy Services, Construction Products, and Rail Products and Services, respectively.sales over the prior year quarter, respectively, with an offsetting 6.8% decline from divestitures.


Gross profit margin for the quarterthree months ended SeptemberJune 30, 20172023, was 20.1% or 280 basis points (“bps”) higher than$32,252, an increase of $8,959 over the prior year quarter. Eachquarter, or 38.5%, and gross profit margins expanded by 410 basis points to 21.8%. The improvement in gross profit is due to the portfolio changes that are a part of the three segments contributed to the increaseCompany’s strategic transformation plan along with gains of 1,830 bps, 290 bps,increased sales volumes, product mix, and 80 bps, in Tubular and Energy Services, Construction Products, and Rail Products and Services, respectively.pricing.


Selling and administrative expenses for the three months ended June 30, 2023 increased by $411$5,134, or 2.1%26.5%, from the prior year. The increase wasyear quarter, due primarily driven byto increased personnel related spending of $821, which was partially offset by reduced litigation costs related toas well as the Union Pacific Railroad ("UPRR") matter of $468.

During the quarter ended September 30, 2016, the Company recorded total non-cash asset impairments of $6,946net impact from goodwillbusiness portfolio actions. Selling and definite-lived intangible assets.

Interest expense, net of interest income, increased by $500, or 34.0%,administrative expenses as a resultpercent of the increasenet sales were 16.6% versus 14.7% in interest rates on outstanding debt. Other income decreased $534, or 49.2%, which primarily relates to losses on foreign exchange as the Canadian Dollar has strengthened compared to the United States Dollar versus the prior year period.quarter.


Other expense - net for the three months ended June 30, 2023 was $719 while other income - net was $701 in the prior year quarter. Other expense - net for the three months ended June 30, 2023 was due to the $1,041 loss on the divestitures of Ties and Chemtec, and other income - net for the three months ended June 30, 2022 was due to a $489 divestiture gain and $318 in insurance proceeds.

The Company’s effective income tax rate for the three-month periodthree months ended SeptemberJune 30, 20172023 was (6.9)%13.9%, compared to 36.1%29.4% in the prior year quarter. For the three months ended September 30, 2017, the Company recorded a tax benefit of $208, compared to $3,379 in the three months ended September 30, 2016. The Company'sCompany’s effective income tax benefitrate for the three months ended SeptemberJune 30, 2017 was2023 differed from the federal statutory of 21% primarily relateddue to changes in our estimated annual effectivethe realization of a portion of its U.S. deferred tax rate.assets previously offset by a valuation allowance. The Company continuedcontinues to maintain a full valuation allowance against its U.S. deferred tax assets.assets, which is likely to result in significant variability of the effective tax rate in the current year.


Net income for the third quarter of 2017three months ended June 30, 2023 attributable to the Company was $3,222,$3,531, or $0.31$0.32 per diluted share, compared to a net loss of $5,982,favorable by $1,521, or $0.58$0.14 per diluted share, infrom 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 valueNet income for the three-month periodsthree months ended SeptemberJune 30, 20172023 was primarily driven by stronger comparable operating profit stemming from margin expansion despite the $1,041 loss on divestitures.

The Company continues to execute its strategic transformation into a technology-focused, high growth infrastructure solutions provider, as evidenced by the number of recent portfolio actions taken, including the sale of Ties, which further reduces the Company’s commoditized offering to allow for increased focus on its core growth platforms, Rail Technologies and 2016:Precast Concrete, as well as organic growth initiatives, debt reduction, and improving shareholder value.
  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

Second Quarter 2023 Compared to Second Quarter 2022

Rail, ProductsTechnologies, and Services
Three Months Ended
June 30,		ChangePercent
Change
202320222023 vs. 20222023 vs. 2022
Net sales$91,616 $81,797 $9,819 12.0 %
Gross profit$19,847 $15,661 $4,186 26.7 %
Gross profit percentage21.7 %19.1 %2.6 %13.1 %
Segment operating profit$6,627 $3,998 $2,629 65.8 %
Segment operating profit percentage7.2 %4.9 %2.3 %46.9 %
  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%


Third Quarter 2017 Compared to Third Quarter 2016
The Rail, ProductsTechnologies, and Services segment sales for the three months ended June 30, 2023 increased by $5,204,$9,819, or 9.1%12.0%, compared to the prior year period. Thequarter. Net sales increase was primarily driven domesticallyincreased by 17.0% organically and by 0.8% from the acquisition of Skratch, offset by a $3,037 increase in our distribution business, which experienced increased demand as overall tonnage sold increased compared to5.8% decrease from the prior period, and Allegheny Rail Products, which increased by $2,017, following a 76% demand increase from Class 1 railroads.

divestiture of Track Components. The Rail Products and Global Friction Management business units increase in sales was offset by sales decreases in the Technology Services and Solutions business unit. The Rail Products and Global Friction Management sales increase was driven by strength in domestic markets served. The sales decrease in the Technology Services and Solutions business unit was driven by weak economic conditions in the Company’s U.K. based businesses.

The Rail, Technologies, and Services segment gross profit increased by $5,519 to 5.6% of net sales. The increase was primarily attributable to 2016 impairment charges of $4,383 related to Rail Technologies goodwill. Non-GAAP$4,186, or 26.7% over the prior year quarter, and gross profit margins expanded 260 basis points to 21.7%. Gross profit increases in Rail Products and Global Friction Management were commensurate with higher sales levels, while weaker sales in Technology Services and Solutions partially offset the increased $1,597, or 13.1%, asgross
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profit. The improvement in gross profit is due to the portfolio changes that are a resultpart of the Company’s strategic transformation along with increased domestic distribution volumes.sales in the higher margin Global Friction Management business along with improved pricing. Operating profit was $6,627, a $2,629 increase over the prior year quarter, due primarily to higher gross profit levels.


During the current quarter, the Rail, ProductsTechnologies, and Services segment had an increase in new orders of 44.5% compared to the prior year period, while backlog was $85,764 at September 30, 2017, an increase of 60.6%, compared to $53,392 at September 30, 2016. The Company is encouraged by continuing positive trends signaling a recovering freight rail market in North America and strength in the transit system projects globally.

Construction Products
  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%

Third Quarter 2017 Compared to Third Quarter 2016
Construction Products segment sales increased by $4,248,$23,048, or 12.2%, compared to the prior year period. Fabricated Bridge and Precast Concrete Products businesses increased by $4,411 and $1,185, respectively. Fabricated Bridge generated favorable sales in the current quarter due to bridge form projects as well as the continuation of the Peace Bridge project. Precast Concrete Products was favorably impacted by increased building sales to state agencies. These increases were partially offset by a reduction in Piling sales of $1,348, primarily related to lower sheet piling volumes.

The Construction Products segment profit increased by $2,031 to 8.7% of net sales. The increase was primarily volume related, improved manufacturing efficiencies, and to a lesser extent, reduced selling and administrative expenses 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.

During the quarter, the Construction Products segment had a decrease in new orders of 11.1% compared to the prior year period. The decrease related to a 47.8% reduction Piling orders due to lower sheet piling demand. This was partially offset by increased new orders 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 the prior year period.

Tubular and Energy Services
  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%

Third Quarter 2017 Compared to Third Quarter 2016
Tubular and Energy Services segment sales increased by $7,396, or 32.3%24.8%, compared to the prior year period. The increase relatedis due to strong bookingstailwinds from Protective Coatings and Test and Inspection Services businesses, partially offset bygovernment infrastructure investment programs, despite a $3,114 decrease in Precision Measurement Systems sales. The quarter showed continued improvement withindue to the upstream oil and gas market. Sales indivested Track Components business. Backlog as of June 30, 2023 was $132,451, an increase of $434, or 0.3%, versus the Precision Measurement Systems business are below prior year although order input was very strong inquarter, despite a $6,960 and $832 reduction due to the quarter as backlog is now 99.7% above prior year levels.Ties and Track Components divestitures, respectively.


Tubular and Energy ServicesPrecast Concrete Products
Three Months Ended
June 30,		ChangePercent
Change
202320222023 vs. 20222023 vs. 2022
Net sales$33,865 $23,611 $10,254 43.4 %
Gross profit$7,676 $3,347 $4,329 129.3 %
Gross profit percentage22.7 %14.2 %8.5 %59.9 %
Segment operating profit (loss)$1,296 $(125)$1,421 **
Segment operating profit (loss) percentage3.8 %(0.5 %)4.3 %**
** Results of the calculation are not considered meaningful for presentation purposes.

The Precast Concrete Products segment profitsales for the three months ended June 30, 2023 increased by $9,264,$10,254, or 133.0%43.4%, compared to the prior year quarter. The quarter was favorably impacted by non-GAAP gross profitVanHooseCo acquisition contributed $7,230, or 30.6%, of $5,767the increase in sales over the prior year period, with increases from each division withinquarter. Organic sales increased by $3,024, or 12.8%, which is a continued reflection of the segment. strong demand environment in the southern and northeastern United States markets.

The prior year was negatively affected by impairment charges of $2,563Precast Concrete Products segment's gross profit for the three months ended SeptemberJune 30, 2016.2023 increased by $4,329, and gross profit margins expanded by 850 basis points to 22.7%. The improvement in gross profit is due to the VanHooseCo acquisition as well as overall sales volumes and stronger margins from the legacy precast business, including the impact of improved pricing. Operating profit for the second quarter of 2023 was $1,296, a $1,421 improvement over the prior year quarter, due to higher gross profit levels, which was partially offset by an increase in selling and administrative expenses from the VanHooseCo acquisition, as well as increased personnel expenses.


The Tubular and Energy ServicesDuring the quarter, the Precast Concrete Products segment had an increase in new orders and backlog of 97.1%65.0% and 28.2%, respectively, compared to the prior year period. Orders for Precisionquarter. The increase in new orders and backlog is due primarily to the VanHooseCo acquisition.

Steel Products and 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.

Three Months Ended
June 30,		ChangePercent
Change
202320222023 vs. 20222023 vs. 2022
Net sales$22,553 $26,107 $(3,554)(13.6)%
Gross profit$4,729 $4,285 $444 10.4 %
Gross profit percentage21.0 %16.4 %4.6 %27.8 %
Segment operating profit$1,456 $762 $694 91.1 %
Segment operating profit percentage6.5 %2.9 %3.6 %124.1 %
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 Steel Products and Measurement 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 periodthree months ended SeptemberJune 30, 2017 increased2023 decreased by $18,106,$3,554, or 4.8%13.6%, compared to the prior year period.quarter. The changedecrease in sales for the second quarter of 2023 was attributable to increasesthe $4,176 decrease due to the divestiture of 13.8%the Chemtec business during the first quarter of 2023 and 5.0%a decline in the ConstructionFabricated Steel Products business, driven by soft demand for bridge grid decking. This decline was offset by increased activity in both traditional and adjacent market applications in the Protective Coatings business unit within Coatings and Measurement.

Steel Products and TubularMeasurement gross profit for the three months ended June 30, 2023 increased by $444, and Energy Services segments, respectively. Thisgross profit margins increased 460 basis points to 21.0%. The increase in gross profit is primarily due to stronger margins in the Protective Coatings division attributable to higher volumes. The segment operating profit increased by $694 from the prior year quarter, due to higher gross profit levels.
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During the quarter, the Steel Products and Measurement segment had an increase in new orders and backlog of $4,360, or 17.0%, and $18,635, or 39.4%, respectively, compared to the prior year quarter. The increase is a result of improved order levels in the Protective Coatings division due to strong demand in both traditional and adjacent market applications which was offset by a $6,023 decline from the Chemtec divestiture. The backlog increase was partially offset by a $7,503 decrease due to the Chemtec divestiture.

Six Month Results
Six Months Ended
June 30,		Percent
Change		Percent of Total Net Sales
Six Months Ended
June 30,
202320222023 vs. 202220232022
Net sales$263,522 $230,309 14.4 %100.0 %100.0 %
Gross profit55,543 39,740 39.8 21.1 17.3 
Expenses:
Selling and administrative expenses45,951 36,692 25.2 17.4 15.9 
Amortization expense2,740 2,855 (4.0)1.0 1.2 
Operating profit6,852 193 **2.6 0.1 
Interest expense - net2,962 754 **1.1 0.3 
Other expense (income) - net2,546 (1,264)**1.0 (0.5)
Income before income taxes$1,344 $703 91.2 %0.5 %0.3 %
Income tax expense22 313 (93.0)— 0.1 
Net income1,322 390 239.0 0.5 0.2 
Net loss attributable to noncontrolling interest(57)(54)5.6 — — 
Net income attributable to L.B. Foster Company1,379 444 210.6 0.5 0.2 
Diluted earnings per common share$0.12 $0.04 
** Results of 0.4%the calculation are not considered meaningful for presentation purposes.

Results Summary

Net sales of $263,522 for the six months ended June 30, 2023 increased by $33,213, or 14.4%, over the prior year quarter. The change in sales is due in part to the Rail Productsacquisitions of Skratch and Services segment.VanHooseCo offset by the divestitures of the Track Components and Chemtec businesses.Organic growth and acquisitions drove a 10.8% and 7.4% increase in sales over the prior year quarter, respectively, with an offsetting 3.7% decline from divestitures.


Gross profit margin for the ninesix months ended SeptemberJune 30, 20172023 was 19.1% or 10 bps higher than$55,543, an increase of $15,803 over the prior year period.quarter, or 39.8%, and gross profit margins expanded by 380 basis points to 21.1%. The increase wasimprovement in gross profit is due to the portfolio changes that are a 760 bps improvement withinpart of the TubularCompany’s strategic transformation plan along with higher sales volume, improved product mix, input costs, 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.pricing.


Selling and administrative expenses decreasedfor the six months ended June 30, 2023 increased by $5,918$9,259, or 9.0%25.2%, 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 relatedyear quarter, due in part to the UPRR matteracquisitions of $1,419.

Amortization decreased $2,600, or 33.3%,VanHooseCo and Skratch, as well as higher personnel expenses. Selling and administrative expenses as a resultpercent of net sales were 17.4 % versus 15.9 % in the June 1, 2016 interim intangible asset impairment test, which was finalized duringprior year quarter, a 150 basis point increase.

Other expense - net for the threesix months ended SeptemberJune 30, 2016, resulting2023 was $2,546 while other income - net was $1,264 in a $59,786 impairment of definite-lived intangible assets. During the nineprior year quarter. Other expense - net for the six months ended SeptemberJune 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%, which2023 was due primarily related to the gain$3,074 loss on the saledivestitures of certain assets, which was partially offset byTies and Chemtec, and other income - net for the impact of a weaker United States Dollar relative to the Canadian Dollar in the ninesix months ended SeptemberJune 30, 2017.2022 was due to a $489 divestiture gain and $790 in insurance proceeds.


The Company’s effective income tax rate for the ninesix months ended SeptemberJune 30, 20172023 was 15.4%1.6%, compared to 29.5%44.5% in the prior year period. Forquarter. The Company’s effective tax rate for the first ninesix months ended SeptemberJune 30, 2017,2023 differed from the Company recordedfederal statutory rate of 21% primarily due to the realization of a portion of its U.S. deferred tax provision of $698, compared toassets previously offset by 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.valuation allowance. The Company continuedcontinues to maintain a full valuation allowance against its U.S. deferred tax assets.assets, which is likely to result in significant variability of the effective tax rate in the current year.


Net income for the first ninesix months of 2017ended June 30, 2023 attributable to the Company was $3,824,$1,379, or $0.37$0.12 per diluted share, compared to a net loss of $100,810,favorable by $935, or $9.82$0.08 per diluted share, infrom the prior year period. The following table providesquarter. Net income was primarily driven stronger operating profit stemming
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from margin expansion during the six months ended June 30, 2023, which was offset by a reconciliation$3,074 loss on the divestitures of the GAAP earnings per share valueChemtec and Ties.

The Company continues to execute its strategic transformation into a technology-focused, high growth infrastructure solutions provider, as evidenced by the non-GAAP adjusted earnings1 per share valuenumber of recent portfolio actions taken, including the sale of Ties, which further reduces the Company’s commoditized offering to allow for the nine-month periods ended September 30, 2017increased focus on its core growth platforms, Rail Technologies and 2016:Precast Concrete, as well as organic growth initiatives, debt reduction, and improving shareholder value.

  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

First Six Months 2023 Compared to First Six Months 2022

Rail, ProductsTechnologies, and Services
Six Months Ended
June 30,		ChangePercent
Change
202320222023 vs. 20222023 vs. 2022
Net sales$156,000 $145,507 $10,493 7.2 %
Gross profit$34,131 $28,188 $5,943 21.1 %
Gross profit percentage21.9 %19.4 %2.5 %12.9 %
Segment operating profit$9,015 $5,037 $3,978 79.0 %
Segment operating profit percentage5.8 %3.5 %2.3 %66.9 %
  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
The Rail, ProductsTechnologies, and Services segment sales decreased $764,for the six months ended June 30, 2023 increased by $10,493, or 0.4%7.2%, compared to the prior year period. The reduction inquarter. Net sales is primarily related to a decrease in our domestic businessesincreased by 12.1% organically and by 1.0% from the acquisition 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 partiallySkratch, offset by sales increases in our foreign divisionsa 5.9% decrease from the divestiture of $5,192, or 10.6%, as we saw favorable results in both our Canadian and European markets.

Track Components. The Rail Products and Global Friction Management business unit increase in sales were offset by sales decreases in the Technology Services and Solutions business unit. The Rail Products and Global Friction Management sales increases were driven by strength in domestic markets served. The sales decrease in the Technology Services and Solutions business unit was driven by the completion of the multi-year Crossrail project in late 2022 and weak economic conditions in the United Kingdom.

The Rail, Technologies, and Services segment gross profit increased by $35,412$5,943, or 21.1% over the prior year quarter, and gross profit margins expanded 250 basis points to 4.8% of net sales. The increase was primarily attributable to a reduction21.9%. Gross profit increases in selling, administrative,Rail Products and allocated expenses of $4,430, or 13.9%,Global Friction Management were commensurate with higher sales levels, while weaker sales in Technology Services and the 2016 impairment charges of $32,725 related to Rail Technologies goodwill. This wasSolutions partially offset by a declinethe gross profit. The improvement in non-GAAP gross profit is due to the portfolio changes that are a part of $2,011, or 4.9%, whichthe Company’s strategic transformation along with increased sales in the higher margin Global Friction Management business along with improved pricing. Operating profit was $9,015, a $3,978 increase over the prior year quarter, due 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.higher gross profit levels.


During the current year,quarter, the Rail, ProductsTechnologies, 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,$5,385, or 13.8%2.9%, compared to the prior year period. The increase relatedis due primarily to Fabricated Bridge and Piling businesses of $9,428 and $7,112, respectively. Fabricated Bridge continued to have favorable salesincreases in the current year due to several projects, including the continuation of the Peace Bridge project. The increase in PilingGlobal Friction Management business unit, which was primarily due to demand within the sheet piling product line. These increases were offset by a reduction in Precast Concrete Products salesan unfavorable impact 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$7,918 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 ordersTrack Components divestiture. Backlog as of 8.7% compared toJune 30, 2023 was $132,451, an increase of $434, or 0.3%, versus the prior year period. Prior year Fabricated Bridge orders included the $15,000 Peace Bridge project. Piling sawquarter, despite a 6.3%$6,960 and $832 reduction in new orders compareddue to the prior year from recent declines in sheet piling demand. Ties and Track Components sales, respectively.

Precast Concrete Products
Six Months Ended
June 30,		ChangePercent
Change
202320222023 vs. 20222023 vs. 2022
Net sales$58,153 $38,621 $19,532 50.6 %
Gross profit$13,197 $5,792 $7,405 127.8 %
Gross profit percentage22.7 %15.0 %7.7 %51.3 %
Segment operating profit (loss)$948 $(916)$1,864 203.5 %
Segment operating profit (loss) percentage1.6 %(2.4)%4.0 %168.7 %

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 for the six months ended June 30, 2023 increased $4,063,by $19,532, or 5.0%50.6%, compared to the prior year period.quarter. The VanHooseCo acquisition contributed $15,530, or 40.2% of the increase relatedin sales over the prior year quarter.
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Organic sales increased by $4,002, or 10.4%, which is a continued reflection of the strong demand environment in the southern and northeastern United States markets.

The Precast Concrete Products segment's gross profit for the six months ended June 30, 2023 increased by $7,405, and gross profit margins expanded by 770 basis points to growth22.7%. The improvement in gross profit is due to the VanHooseCo acquisition as well as overall sales volumes and stronger margins from Test and Inspection Services and Protective Coating businesses,the legacy precast business, including the impact of improved pricing. Operating profit for the six months ended June 30, 2023 was $948, a $1,864 improvement over the prior year quarter, due to higher gross profit levels, which was partially offset by a decreasean increase in Precision Measurement Systems. The period showed increased new well countselling 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 $2,401administrative expenses from the 2016 definite-lived intangible asset impairment. The prior period was also negatively affected by impairment charges of $103,159 forVanHooseCo acquisition, as well as increased personnel expenses.

During 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 Servicesquarter, the Precast Concrete Products segment had an increase in new orders and backlog of 47.6%76.0% and 28.2%, respectively, compared to the prior year period. Ordersquarter. The increase in new orders and backlog is due to the VanHooseCo acquisition and strong demand in the legacy business.

Steel Products and Measurement
Six Months Ended
June 30,		ChangePercent
Change
202320222023 vs. 20222023 vs. 2022
Net Sales$49,369 $46,181 $3,188 6.9 %
Gross profit$8,215 $5,760 $2,455 42.6 %
Gross profit percentage16.6 %12.5 %4.1 %33.4 %
Segment operating profit (loss)$1,448 $(1,386)$2,834 204.5 %
Segment operating profit (loss) percentage2.9 %(3.0)%5.9 %197.7 %

The Steel Products and Measurement segment sales for the six months ended June 30, 2023 increased by $3,188, or 6.9%, compared to the prior year quarter. The increase in sales for the second quarter of 2023 was attributable to the increase in Coatings and Measurement sales over the prior year quarter, due to increased activity in both traditional and adjacent market applications. This increase was partially offset by a decrease in Fabricated Steel Products business unit sales, driven by soft demand for bridge grid decking.

Steel Products and Measurement gross profit for the six months ended June 30, 2023 increased by $2,455, and gross profit margins increased 410 basis points to 16.6%. The increase in gross profit is primarily due to stronger margins in the Protective Coatings and Test and Inspection Services businessesdivision attributable to higher volumes. The segment operating profit increased by 151.2%$2,834 from the prior year quarter, due to higher gross profit levels.

During the quarter, the Steel Products and 107.5%Measurement segment had an increase in new orders and backlog of $9,057, or 17.9%, and $18,635, or 39.4%, respectively, compared to the prior year quarter. The increase is a result of improved order levels in the Fabricated Steel Products business unit and the Protective Coatings division due to strong demand in both traditional and adjacent market applications which was offset by a decrease of $6,982 due to the divestiture of Chemtec. The backlog increase was partially offset by a $7,503 decrease due to the Chemtec divestiture.

Liquidity and Capital Resources
The Company’s principal sources of liquidity are its existing cash and cash equivalents, cash generated by operations, and the available capacity under the revolving credit facility, which provides for a total commitment of up to $130,000, of which $39,547 was available for borrowing as of June 30, 2023, subject to covenant restrictions. The Company’s primary needs for liquidity relate to working capital requirements for operations, capital expenditures, debt service obligations, payments related to the Union Pacific Railroad Settlement, and acquisitions. The Company’s total debt, including finance leases, was $89,505 and $91,879 as of June 30, 2023 and December 31, 2022, respectively, and was primarily comprised of borrowings under its revolving credit facility.


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The following table reflects available funding capacity, subject to covenant restrictions, as of June 30, 2023:
June 30, 2023
Cash and cash equivalents$3,880 
Credit agreement:
Total availability under the credit agreement130,000 
Outstanding borrowings on revolving credit facility(89,280)
Letters of credit outstanding(1,173)
Net availability under the revolving credit facility39,547 
Total available funding capacity$43,427 

The Company’s cash flows are impacted from period to period by fluctuations in working capital, as well as its overall profitability. While the Company places an emphasis on working capital management in its operations, factors such as its contract mix, commercial terms, days sales outstanding (“DSO”), and market conditions as well as seasonality may impact its working capital. The Company regularly assesses its receivables and contract assets for collectability and realization, and provides allowances for credit losses where appropriate. The Company believes that its reserves for credit losses are appropriate as of June 30, 2023, but adverse changes in the economic environment and adverse financial conditions of its customers may impact certain of its customers’ ability to access capital and pay the Company for its products and services, as well as impact demand for its products and services.

The changes in cash and cash equivalents for the six months ended June 30, 2023 and 2022 were as follows:
Six Months Ended June 30,
20232022
Net cash used in operating activities$(3,333)$(13,382)
Net cash provided by (used in) investing activities7,716 (7,328)
Net cash (used in) provided by financing activities(3,563)18,476 
Effect of exchange rate changes on cash and cash equivalents178 (477)
Net increase (decrease) in cash and cash equivalents$998 $(2,711)

Cash Flow from Operating Activities
During the six months ended June 30, 2023, net cash used by operating activities was $3,333, compared to cash used by operating activities of $13,382 during the prior year period. For the six months ended June 30, 2023, net income and adjustments to reconcile net income from operating activities provided $11,862, compared to $7,277 in the prior year period. Working capital and other assets and liabilities used $15,195 in the current period, compared to using $20,659 in the prior year period. The Company received $2,973 during the six months ended June 30, 2023 associated with its federal income tax refund claims, which have now been collected in full.

Cash Flow from Investing Activities
Capital expenditures for the six months ended June 30, 2023 and 2022 were $1,495 and $3,048, respectively. The upstream oilcurrent period expenditures primarily relate to general plant and gasoperational improvements throughout the Company, including corporate system and facility improvements and organic growth initiatives. Expenditures for the six months ended June 30, 2022 primarily related to general plant and operational improvements throughout the Company, as well as organic growth initiatives. During the six months ended June 30, 2023, the Company divested the assets of its Chemtec and Ties businesses, generating a cash inflow of $7,706. During the six months ended June 30, 2023 the Company received proceeds of $966 from final working capital adjustments related to prior year acquisitions. During the six months ended June 30, 2022 the Company had $5,712 in cash outflows for the acquisition of Skratch.

Cash Flow from Financing Activities
During the six months ended June 30, 2023 and 2022, the Company had a decrease in outstanding debt of $2,920 and an increase of $18,877, respectively. The decrease in debt for the six months ended June 30, 2023 was primarily due to the proceeds received from the Ties and Chemtec divestiture during the period, which were used to pay down debt, partially offset by increased working capital needs. The increase in debt for the 2022 period was the result of funding working capital and other assets and liabilities. Treasury stock acquisitions of $977 and $401 for the six months ended June 30, 2023 and 2022, respectively, represent stock repurchases from employees to satisfy their income tax withholdings in connection with the vesting of stock awards.

During the first quarter of 2023, the Company’s Board of Directors authorized the repurchase of up to $15,000 of the Company’s common stock in open market continuedtransactions through February 2026. Repurchases are limited to up to $5,000 in any trailing 12-month period, with unused amounts carrying forward to future periods through the end of the authorization. Any repurchases will be subject
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to the Company’s liquidity, including availability of borrowings and covenant compliance under its recovery. We are also encouragedrevolving credit facility, and other capital needs of the business. In connection with the stock repurchase program, 51,241 shares valued at $662 were repurchased during the six months ended June 30, 2023.

Repurchases of shares of the Company’s common stock may be made from time to time in the open market or in such other manner as determined by positive trendsthe Company. The timing of the repurchases and the actual amount repurchased will depend on a variety of factors, including the market price of the Company’s shares, general market and economic conditions, and other factors. The stock repurchase program does not obligate the Company to acquire any particular amount of common stock and may be suspended or discontinued at any time.

Financial Condition
As of June 30, 2023, the Company had $3,880 in midstream order activitycash and cash equivalents. The Company’s cash management priority continues to be short-term maturities and the preservation of its principal balances. As of June 30, 2023, approximately $2,418 of the Company’s cash and cash equivalents were held in non-domestic bank accounts. The Company principally maintains its cash and cash equivalents in accounts held by major banks and financial institutions.

The Company’s principal uses of cash have been to fund its operations, including capital expenditures, acquisitions, and to service its indebtedness. The Company views its liquidity as we endedbeing dependent on its results of operations, changes in working capital needs, and its borrowing capacity. As of June 30, 2023, the nine-month period.Company's revolving credit facility had $39,547 of net availability, while the Company had $89,505 in total debt.


On July 31, 2017, the lease at our Birmingham, Alabama facility expired. During the third quarter ended September 30, 2017,August 13, 2021, the Company negotiatedentered into the Credit Agreement, which increased the total commitments under the revolving credit facility to $130,000, extended the maturity date from April 30, 2024 to August 13, 2026, and provided more favorable covenant terms. Borrowings under the Credit Agreement bear interest rates based upon either the base rate or SOFR rate plus applicable margins. The Company believes that the combination of its cash and cash equivalents, cash generated from operations, and the capacity under its revolving credit facility should provide the Company with sufficient liquidity to provide the flexibility to operate the business in a lease renewalprudent manner and enable the Company to continue to service its outstanding debt. On August 12, 2022, the Company amended its Credit Agreement to obtain approval for the VanHooseCo acquisition and temporarily modify certain financial covenants to accommodate the transaction. The Second Amendment permitted the Company to acquire the operating assets of VanHooseCo and modified the maximum Gross Leverage Ratio covenant to 3.50 through June 30, 2023 to accommodate the transaction. The Second Amendment also added an additional tier to the pricing grid and provided for the conversion from LIBOR-based to SOFR-based borrowings. For a discussion of the terms and availability of the credit facilities, please refer to Note 7 of the Notes to Condensed Consolidated Financial Statements contained in this facility. The renewal is forQuarterly Report on Form 10-Q.

To reduce the impact of interest rate changes on outstanding variable-rate debt, the Company amended and entered into SOFR-based interest rate swaps with notional values totaling $20,000 and $20,000, effective August 12, 2022 and August 31, 2022, respectively, at which point the agreements effectively converted a portion of the debt from variable to fixed-rate borrowings during the term of five years and is scheduled to expire July 31, 2022.the swap contract.

Other
Segment Backlog
Total Company backlog is summarized by business segment in the following table for the periods indicated:
Backlog
June 30,
2023		December 31,
2022		June 30,
2022
Rail, Technologies, and Services$132,451 $105,241 $132,017 
Precast Concrete Products91,669 80,501 71,507 
Steel Products and Measurement65,956 86,509 47,321 
Total backlog$290,076 $272,251 $250,845 
  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


The Company’s backlog represents the sales price of received customer purchase orders and any contracts for which the performance obligations have not been met, and therefore are precluded from revenue recognition. Although the Company believes that the orders included in backlog are firm, customers may cancel or change their orders with limited advance notice; however, these instances have been rare. Backlog should not be considered a reliable indicator of the Company’s ability to achieve any particular level of revenue or financial performance. While a considerable portion of ourthe Company’s business is backlog-driven, certain product lines within the Rail Products and Services and Tubular and Energy Services segmentsCompany are not driven by backlog and therefore have insignificant levels throughoutas the year.orders are fulfilled shortly after they are received.

Warranty
As of September 30, 2017,The Company defines new orders as a contractual agreement between 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 and $159,565 as of September 30, 2017 and December 31, 2016, respectively, and was primarily comprised of borrowings on our revolving credit facility and term loan.

Our need for liquidity relates primarily to working capital requirements for operations, capital expenditures, joint venture capital obligations, debt service obligations, and share repurchases as authorized by the Board of Directors and as permitted under the Second Amended and Restated Credit Agreement dated March 13, 2015.

The change in cash and cash equivalents for the periods ended September 30 are as follows:
  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, cash flows provided by operating activities were $27,516 compared to $11,876 during the prior year period. For the nine months ended September 30, 2017, income and adjustments to income from operating activities provided $18,985 compared to $15,976 in the 2016 period. Working capital and other assets and liabilities provided $8,531 in the current period compared to a use of $4,100 in the prior year period. During the nine months ended September 30, 2017, the Company received $9,946 and $1,827 from our 2016 and 2015 federal income tax refunds, respectively.

The Company’s calculation for days sales outstanding at September 30, 2017 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 nine months ended September 30, 2017 and 2016 were $5,335 and $6,507, respectively. The current year expenditures relate to trackside rail lubricator units installed as part of a new multi-year service contract and general plant and operational improvements. Expenditures for the nine 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, the Company received $1,388 in proceeds from the sale of certain property, plant, and equipment as compared to $923 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 nine months ended September 30, 2017, the Company had a decrease in outstanding debt of $21,281, primarily related to payments against the revolving credit facility as well as the application 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 in outstanding debt of $33,125, primarily related to payments against the revolving credit facility. 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, we had $35,008 in cash and cash equivalents and a domestic credit facility with $46,081 of net availability while we had $138,285third-party 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.

Our cash management priority continues to be short-term maturities and the preservation of our principal balances. Approximately $33,976 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.

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 intoor has the highest tierability to, satisfy the performance obligations of the pricing grid, which provides for pricingpromised products or services under the terms 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 dateagreement.
28
Table 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.Contents

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 convert a portion of the debt from variable to fixed-rate borrowings during the term of the swap contract. At September 30, 2017, the swap liability was $323 compared to $334 as of December 31, 2016.

Cost in Excess of Net Assets Acquired
At September 30, 2017, L.B. Foster had $19,699 of goodwill on its consolidated balance sheet. Of the total, $14,552 related to the Rail Products and Services segment and $5,147 related to the Construction Products segment. Goodwill is reviewed annually 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. Based 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.

Critical Accounting PoliciesEstimates
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. There have been no material changes in the Company’s critical accounting policies or estimates since December 31, 2016. 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, 2016.2022.

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, 2016 is included in the “Liquidity and Capital Resources” section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. There were no 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 SeptemberJune 30, 2017.2023. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of such date 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
There were no 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 ninesix months ended SeptemberJune 30, 2017,2023, and 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 Liabilities 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 SeptemberJune 30, 20172023 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 programs (2)Approximate dollar value of shares that may yet be purchased under the plans or programs
April 1, 2023 - April 30, 2023— $— — $15,000 
May 1, 2023 - May 31, 2023— — 30,03514,632 
June 1, 2023 - June 30, 2023441 14.02 21,20614,338 
Total441 $14.02 51,241$14,338 

1.Reflects shares withheld by the Company to pay taxes upon vesting of restricted stock.
2.On March 3, 2023, the Board of Directors authorized the repurchase of up to $15,000 of the Company’s common shares until February 2026.
Item 3. Defaults Upon Senior Securities
  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
Not applicable.
(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.

Item 5. Other Information
Trading Arrangements
None of the Company’s directors or “officers,” as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K, during the Company’s fiscal quarter ended June 30, 2023.
Amended and Restated Bylaws
On August 7, 2023, the Company’s Board of Directors (the “Board”) approved the Amended and Restated Bylaws, effective as of such date (the “Amended and Restated Bylaws”). The Amended and Restated Bylaws include certain changes to the procedures by which shareholders may recommend nominees to the Board, among other updates, including to:

•implement certain revisions to the Amended and Restated Bylaws in line with Pennsylvania law, including (i) clarifying the requirements and procedures relating to virtual shareholder meetings and the notice procedures applicable to shareholder meetings, (ii) describing the role and authority of the presiding officer at any meeting of shareholders, (iii) specifying the procedures for a shareholder to authorize a proxy, (iv) clarifying who has the authority to fill vacancies on the Board, and (v) clarifying the indemnification rights of directors, officers and other persons under the Amended and Restated Bylaws;

•address matters relating to Rule 14a-19 (the “Universal Proxy Rule”) under the Exchange Act, including (i) requiring that any shareholder submitting a nomination notice make a representation as to whether such shareholder intends to solicit proxies in support of director nominees other than the Company’s nominees in accordance with the Universal Proxy Rule, and if so, agree in writing that such shareholder will comply with the requirements of the Universal Proxy Rule; (ii) providing the Company a remedy if a shareholder fails to satisfy the Universal Proxy Rule requirements; (iii) requiring that a shareholder inform the Company if such shareholder no longer plans to solicit proxies in accordance with the Universal Proxy Rule; and (iv) requiring shareholders intending to use the Universal Proxy Rule to provide reasonable evidence of the satisfaction of the requirements under the Universal Proxy Rule at least five business days before the meeting upon request by the Company;

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•revise and enhance the procedures and disclosure requirements set forth in the advance notice bylaw provisions for director nominations made and business proposals submitted by shareholders (other than proposals submitted pursuant to Rule 14a-8 under the Exchange Act), including (i) requiring additional information, representations, and disclosures regarding proposing shareholders, proposed nominees, proposed business, and other persons related to, and acting in concert with, a shareholder and the shareholder’s solicitation of proxies; (ii) requiring a shareholder to be present in person to present its nomination or proposal at a shareholder meeting; (iii) clarifying that shareholders are not entitled to make additional or substitute nominations or proposals after the submission deadline and may only nominate a number of candidates to the Board that does not exceed the number of directors to be elected at such meeting; (iv) requiring that if requested by the Secretary of the Company, the Board or any committee of the Board proposed nominees make themselves available for interviews by the Board and any committee of the Board within five business days following the date of such request; and (v) clarifying the authority of the Secretary of the Company, the Board, or any committee of the Board to request additional information or written verification to demonstrate the accuracy of previously-provided information with respect to proposing shareholders, proposed nominees, and proposed business;

•require any shareholders directly or indirectly soliciting proxies from other shareholders to use a proxy card color other than white, with the white proxy card being reserved for exclusive use by the Board;

•provide that, unless the Company consents in writing to the selection of an alternative forum, (i) the state and federal courts sitting in the judicial district of the Commonwealth of Pennsylvania in the county of the Company’s registered office, will be the sole and exclusive forum for any (A) derivative action or proceeding brought on behalf of the Company, (B) action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer or other employee of the Company to the Company or the Company’s shareholders, (C) action asserting a claim arising pursuant to any provision of the Pennsylvania Business Corporation Law, the Company’s articles of incorporation or the Amended and Restated Bylaws, or (D) action asserting a claim governed by the internal affairs doctrine; and (ii) the federal district courts of the United States of America will be the sole and exclusive forum for any action asserting a claim arising under the Securities Act of 1933, as amended; and

•incorporate certain administrative, modernizing, and conforming changes to provide clarification and consistency, including those regarding meetings of the Board and of the shareholders.

The foregoing description of the Amended and Restated Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended and Restated Bylaws, which is filed as Exhibit 3.1 to this Quarterly Report on Form 10-Q and incorporated herein by reference.
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Item 6. Exhibits
See Exhibit Index below.


Exhibit Index
Exhibit NumberDescription
*3.1
Amended and Restated Bylaws of the Company.
Exhibit Number*31.1Description
10.1
Second Amendment dated November 7, 2016 to the Second Amended and Restated Credit Agreement dated March 13, 2015, and as amended by the First Amendment dated June 29, 2016, among Registrant and PNC Bank N.A., Bank of America, N.A., Wells Fargo Bank, N.A., Citizens Bank of Pennsylvania, and Branch Banking and Trust Company is incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K/A filed on November 8, 2016, File No. 0-10436.
10.2
Deferred Compensation Plan for Non-Employee Directors under the 2006 Omnibus Incentive Plan.
*31.1
Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
*31.2
Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
*32.0
Certification of Chief Executive Officer and Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002.
*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.
*104Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
*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:NovemberAugust 8, 20172023By: /s/ James P. MaloneyWilliam M. Thalman
James P. MaloneyWilliam M. Thalman
SeniorExecutive Vice President
and Chief Financial Officer and Treasurer
(Duly Authorized Officer of Registrant)



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