Westinghouse Air Brake Technologies(WAB) - 2024 Q3 - Quarterly Report

FORM 10-Q PART I—FINANCIAL INFORMATION Item 1. Financial Statements - (Unaudited) Presents unaudited condensed consolidated financial statements for Q3 2024, including balance sheets, income, cash flow, equity, and detailed notes Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets Summary | Item | Sep 30, 2024 (Millions) | Dec 31, 2023 (Millions) | | :--- | :--- | :--- | | Total Assets | $18,644 | $18,988 | | Total Liabilities | $8,353 | $8,464 | | Total Equity | $10,291 | $10,524 | Condensed Consolidated Statements of Income Condensed Consolidated Statements of Income Summary | Item | 3 Months Ended Sep 30, 2024 (Millions) | 3 Months Ended Sep 30, 2023 (Millions) | 9 Months Ended Sep 30, 2024 (Millions) | 9 Months Ended Sep 30, 2023 (Millions) | | :--- | :--- | :--- | :--- | :--- | | Total Net Sales | $2,663 | $2,550 | $7,804 | $7,151 | | Gross Profit | $880 | $792 | $2,569 | $2,180 | | Income from Operations | $433 | $370 | $1,275 | $958 | | Net Income Attributable to Wabtec Shareholders | $283 | $240 | $844 | $600 | | Diluted EPS | $1.63 | $1.33 | $4.80 | $3.33 | Condensed Consolidated Statements of Comprehensive Income Condensed Consolidated Statements of Comprehensive Income Summary | Item | 3 Months Ended Sep 30, 2024 (Millions) | 3 Months Ended Sep 30, 2023 (Millions) | 9 Months Ended Sep 30, 2024 (Millions) | 9 Months Ended Sep 30, 2023 (Millions) | | :--- | :--- | :--- | :--- | :--- | | Net Income Attributable to Wabtec Shareholders | $283 | $240 | $844 | $600 | | Foreign currency translation gain (loss) | $114 | $(106) | $(23) | $(82) | | Other comprehensive income (loss), net of tax | $113 | $(89) | $(17) | $(52) | | Comprehensive Income Attributable to Wabtec Shareholders | $396 | $151 | $827 | $548 | Condensed Consolidated Statements of Cash Flows Condensed Consolidated Statements of Cash Flows Summary | Item | 9 Months Ended Sep 30, 2024 (Millions) | 9 Months Ended Sep 30, 2023 (Millions) | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,111 | $515 | | Net cash used for investing activities | $(106) | $(336) | | Net cash used for financing activities | $(1,209) | $(323) | | Cash, cash equivalents and restricted cash, end of period | $410 | $392 | Condensed Consolidated Statements of Shareholders' Equity Condensed Consolidated Statements of Shareholders' Equity Summary | Item | Dec 31, 2023 (Millions) | Sep 30, 2024 (Millions) | | :--- | :--- | :--- | | Total Equity | $10,524 | $10,291 | | Stock Repurchase (9 months) | N/A | $(974) | | Cash Dividends (9 months) | N/A | $(106) | Notes to Condensed Consolidated Financial Statements Note 1. BUSINESS - Wabtec is a global provider of value-added, technology-based locomotives, equipment, systems, and services for the freight rail and passenger transit industries, as well as the mining, marine and industrial markets[17] - Approximately 52% of the Company's Net sales in the first nine months of 2024 came from customers outside the United States[17] Note 2. ACCOUNTING POLICIES - The unaudited condensed consolidated interim financial statements are prepared in accordance with GAAP and SEC rules, reflecting all normal, recurring adjustments[18] - Remaining performance obligations were approximately $22.2 billion as of September 30, 2024, with about 34% expected to be recognized as revenue over the next 12 months[19] Net Cash Proceeds from Revolving Receivables Program | Item | 9 Months Ended Sep 30, 2024 (Millions) | 9 Months Ended Sep 30, 2023 (Millions) | | :--- | :--- | :--- | | Net cash proceeds received included in cash from operations | $75 | $155 | - New accounting standards ASU 2023-07 (Segment Reporting) and ASU 2023-09 (Income Taxes) will be effective for Wabtec's annual reporting periods beginning January 1, 2024, and January 1, 2025, respectively, requiring increased disclosures[24] Note 3. ACQUISITIONS - On December 22, 2023, Wabtec purchased the remaining 50% ownership of Lokomotiv Kurastyru Zauzty (LKZ) for $111 million, making it a wholly-owned subsidiary and recognizing $111 million in goodwill[29][30] L&M Radiator, Inc. Net Assets Acquired | Item | Amount (Millions) | | :--- | :--- | | Total assets acquired | $302 | | Total liabilities assumed | $57 | | Net assets acquired | $245 | | Goodwill | $106 | | Other intangible assets | $89 | Note 4. INVENTORIES Inventory Components (Net of Reserves) | Item | Sep 30, 2024 (Millions) | Dec 31, 2023 (Millions) | | :--- | :--- | :--- | | Raw materials | $1,028 | $1,062 | | Work-in-progress | $590 | $463 | | Finished goods | $762 | $759 | | Total inventories | $2,380 | $2,284 | Note 5. GOODWILL AND INTANGIBLE ASSETS Goodwill by Segment | Segment | Dec 31, 2023 (Millions) | Additions/Adjustments (Millions) | Foreign Currency Impact (Millions) | Sep 30, 2024 (Millions) | | :--- | :--- | :--- | :--- | :--- | | Freight Segment | $7,294 | $9 | $(23) | $7,280 | | Transit Segment | $1,486 | — | $20 | $1,506 | | Total | $8,780 | $9 | $(3) | $8,786 | Other Intangible Assets (Net) | Item | Sep 30, 2024 (Millions) | Dec 31, 2023 (Millions) | | :--- | :--- | :--- | | Backlog | $828 | $905 | | Customer relationships | $841 | $902 | | Acquired technology | $708 | $786 | | Total | $2,377 | $2,593 | Estimated Amortization Expense for Intangible Assets | Year | Amount (Millions) | | :--- | :--- | | Remainder of 2024 | $70 | | 2025 | $272 | | 2026 | $267 | | 2027 | $262 | | 2028 | $261 | Note 6. CONTRACT ASSETS AND CONTRACT LIABILITIES - Noncurrent contract assets increased to $175 million at September 30, 2024, from $154 million at December 31, 2023[39] - Noncurrent contract liabilities significantly increased to $319 million at September 30, 2024, from $174 million at December 31, 2023[39] - Provisions for loss contracts decreased to $89 million at September 30, 2024, from $104 million at December 31, 2023[39] Note 7. LEASES Operating Lease Expense and Additions | Item | 3 Months Ended Sep 30, 2024 (Millions) | 3 Months Ended Sep 30, 2023 (Millions) | 9 Months Ended Sep 30, 2024 (Millions) | 9 Months Ended Sep 30, 2023 (Millions) | | :--- | :--- | :--- | :--- | :--- | | Operating lease expense | $18 | $16 | $50 | $48 | | New operating leases added | $8 | $7 | $40 | $27 | - As of September 30, 2024, the present value of lease liabilities was $290 million, with a weighted-average remaining lease term of 7.2 years and a weighted-average discount rate of 2.8%[44][45] Note 8. LONG-TERM DEBT Long-Term Debt Summary | Debt Type | Effective Interest Rate (Sep 30, 2024) | Book Value Sep 30, 2024 (Millions) | Book Value Dec 31, 2023 (Millions) | | :--- | :--- | :--- | | 2024 Credit Agreement: Term Loan | 6.7% | $224 | — | | 2022 Credit Agreement: Delayed Draw Term Loan | 6.7% | $250 | $250 | | 4.15% Senior Notes, due 2024 | — | — | $725 | | 5.611% Senior Notes, due 2034 | 5.7% | $495 | — | | Total Long-term portion | N/A | $3,517 | $3,288 | - The Company entered into a new $225 million term loan under the 2024 Credit Agreement, maturing March 14, 2029, with an interest rate of 6.5% at September 30, 2024[49] - The 2022 Credit Agreement provides a $1.5 billion multi-currency revolving credit facility and a $250 million delayed draw term loan (fully drawn in Q3 2023), both maturing August 15, 2027[50][51] - On March 11, 2024, the Company issued $500 million of 5.611% Senior Notes due 2034, with proceeds used to repay the outstanding 2024 Notes at maturity[53] - The Company was in compliance with all financial covenants in the 2022 and 2024 Credit Agreements as of September 30, 2024[52] Note 9. STOCK-BASED COMPENSATION Stock-Based Compensation Expense | Period | 2024 (Millions) | 2023 (Millions) | | :--- | :--- | :--- | | 3 Months Ended Sep 30 | $23 | $16 | | 9 Months Ended Sep 30 | $57 | $42 | - Unamortized compensation expense related to stock options, non-vested restricted shares, and incentive stock units was approximately $91 million at September 30, 2024[56] - Approximately 4.4 million shares were available for future grants under the 2011 Stock Incentive Compensation Plan as of September 30, 2024[56] - The Company estimates achieving 158%, 163%, and 175% for incentive stock awards expected to vest for the three-year periods ending December 31, 2024, 2025, and 2026, respectively[57] Note 10. INCOME TAXES Effective Income Tax Rate | Period | 2024 | 2023 | | :--- | :--- | :--- | | 3 Months Ended Sep 30 | 24.2% | 24.5% | | 9 Months Ended Sep 30 | 24.1% | 25.1% | - The decrease in the effective tax rate was primarily driven by a change in the jurisdictional mix of earnings, audit closures, and higher discrete equity compensation tax deductions[60] Note 11. EARNINGS PER SHARE Earnings Per Common Share | EPS Type | 3 Months Ended Sep 30, 2024 | 3 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2024 | 9 Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Basic | $1.63 | $1.34 | $4.81 | $3.34 | | Diluted | $1.63 | $1.33 | $4.80 | $3.33 | Note 12. WARRANTIES Warranty Activity | Item | 2024 (Millions) | 2023 (Millions) | | :--- | :--- | :--- | | Balance at beginning of year | $248 | $242 | | Warranty expense (9 months) | $84 | $76 | | Warranty claim payments (9 months) | $(63) | $(70) | | Balance at September 30 | $271 | $247 | Note 13. FAIR VALUE MEASUREMENT AND DERIVATIVE INSTRUMENTS - Cash, cash equivalents, and restricted cash are classified as Level 1 in the fair value hierarchy, while Senior Notes are Level 2[63] - The Company uses derivatives (cross-currency swaps, foreign currency forward contracts, interest rate swaps, commodity swaps and options) solely for hedging purposes, not for trading or speculation[63] Fair Values and Notional Amounts of Derivative Instruments (Sep 30, 2024) | Derivative Type | Fair Value (Millions) | Gross Notional Amount (Millions) | | :--- | :--- | :--- | | Foreign Exchange Contracts (Designated) | $4 (assets) / $(6) (liabilities) | $255 (assets) / $329 (liabilities) | | Foreign Exchange Contracts (Non-Designated) | $2 (assets) / — (liabilities) | $156 (assets) / $89 (liabilities) | | Interest Rate Contracts (Designated) | — (assets) / — (liabilities) | $20 (assets) / $20 (liabilities) | | Total Net Fair Value | $(2) (assets) / $2 (non-designated) | $624 (designated) / $245 (non-designated) | - New interest rate hedge contracts were entered into in the third quarter of 2024 to manage interest rate risk for a portion of future expected debt transactions[66] Note 14. COMMITMENTS AND CONTINGENCIES - The Company is subject to environmental laws and regulations and believes its operations comply in all material respects[69] - Claims alleging bodily injury from asbestos exposure have been filed, with most covered by insurance or non-affiliated companies; management believes costs will not be material[69] - Progress Rail sued Wabtec for antitrust, breach of contract, unfair competition, and misrepresentation claims related to the GE Transportation merger, seeking divestiture and damages; Wabtec intends to vigorously defend[69][70] - Xorail, a subsidiary, faces breach of contract allegations from Denver Transit Constructors for the Denver Eagle P3 Project, with alleged damages of $37 million, which Xorail denies[70] Note 15. SEGMENT INFORMATION - The Company has two reportable segments: Freight Segment and Transit Segment, based on internal operations, product/service nature, and customer type[71] Segment Sales to External Customers and Income from Operations (3 Months Ended Sep 30) | Segment | 2024 Sales (Millions) | 2023 Sales (Millions) | 2024 Income from Operations (Millions) | 2023 Income from Operations (Millions) | | :--- | :--- | :--- | :--- | :--- | | Freight Segment | $1,930 | $1,881 | $390 | $325 | | Transit Segment | $733 | $669 | $79 | $70 | | Total | $2,663 | $2,550 | $433 | $370 | Segment Sales to External Customers and Income from Operations (9 Months Ended Sep 30) | Segment | 2024 Sales (Millions) | 2023 Sales (Millions) | 2024 Income from Operations (Millions) | 2023 Income from Operations (Millions) | | :--- | :--- | :--- | :--- | :--- | | Freight Segment | $5,674 | $5,134 | $1,149 | $820 | | Transit Segment | $2,130 | $2,017 | $235 | $208 | | Total | $7,804 | $7,151 | $1,275 | $958 | Sales to External Customers by Product Line (3 Months Ended Sep 30) | Product Line | 2024 (Millions) | 2023 (Millions) | | :--- | :--- | :--- | | Freight Segment: Services | $917 | $787 | | Freight Segment: Equipment | $513 | $620 | | Freight Segment: Components | $296 | $293 | | Freight Segment: Digital Intelligence | $204 | $181 | | Transit Segment: Original Equipment Manufacturer | $349 | $308 | | Transit Segment: Aftermarket | $384 | $361 | Note 16. OTHER (EXPENSE) INCOME, NET Other (Expense) Income, Net | Item | 3 Months Ended Sep 30, 2024 (Millions) | 3 Months Ended Sep 30, 2023 (Millions) | 9 Months Ended Sep 30, 2024 (Millions) | 9 Months Ended Sep 30, 2023 (Millions) | | :--- | :--- | :--- | :--- | :--- | | Foreign currency loss | $(6) | $(3) | $(11) | $(9) | | Equity income | $1 | $12 | $3 | $23 | | Expected return on pension assets/amortization | $3 | $2 | $7 | $5 | | Other miscellaneous expense, net | $(1) | $(1) | — | $(2) | | Total Other (expense) income, net | $(3) | $10 | $(1) | $17 | Note 17. RESTRUCTURING - The three-year strategic initiative "Integration 2.0" aims to consolidate operating footprint, reduce headcount, and streamline manufacturing, with anticipated charges of $135 million to $165 million[81] Integration 2.0 Restructuring Charges | Period | 2024 (Millions) | 2023 (Millions) | | :--- | :--- | :--- | | 3 Months Ended Sep 30 | $10 | $13 | | 9 Months Ended Sep 30 | $22 | $30 | | Total charges to date | $140 | N/A | - The "Portfolio Optimization" initiative focuses on exiting low-margin product offerings, with expected net exit charges of approximately $85 million, primarily non-cash asset write-downs[81] Portfolio Optimization Charges | Period | 2024 (Millions) | 2023 (Millions) | | :--- | :--- | :--- | | 3 Months Ended Sep 30 | $8 | — | | 9 Months Ended Sep 30 | $13 | — | | Total charges to date | $41 | N/A | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Analyzes Wabtec's financial condition, operations, strategic initiatives, liquidity, capital resources, and forward-looking statements Overview - Wabtec is a global provider of technology-based solutions for freight rail, passenger transit, mining, marine, and industrial markets, with approximately 52% of Net sales in the first nine months of 2024 from outside the United States[84] - Key agreements signed in the first nine months of 2024 include multi-year locomotive orders in North America (over $600M), Kazakhstan (over $400M), and Africa, along with long-term parts agreements (over $300M, Brazil over $240M, Asia)[84] - Credit rating upgrades from Fitch Ratings and S&P Global Ratings (to BBB with Stable outlook) and a positive outlook from Moody's reflect Wabtec's strong revenue and profitable growth[84] - The Integration 2.0 strategic initiative has incurred approximately $140 million in restructuring charges to date, targeting $75 million to $90 million in incremental run rate synergies by 2025[84] - The Portfolio Optimization initiative, focused on exiting low-margin product offerings, has incurred approximately $41 million in charges to date, primarily non-cash asset write-downs[84] Results of Operations Consolidated Results (Third Quarter) Consolidated Net Sales and Profitability (Q3 YoY) | Item | Q3 2024 (Millions) | Q3 2023 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Net Sales | $2,663 | $2,550 | $113 | 4.4% | | Gross Profit | $880 | $792 | $88 | 11.1% | | Income from Operations | $433 | $370 | $63 | 17.0% | | Net Income Attributable to Wabtec Shareholders | $283 | $240 | $43 | 17.9% | - Organic sales increased by $114 million, contributing significantly to the overall net sales growth[89][91] - Cost of sales as a percentage of Net sales improved to 67.0% in Q3 2024 from 69.0% in Q3 2023, driven by favorable mix, strong productivity, and Integration 2.0 impacts[92] - Interest expense, net, decreased by $8 million to $52 million, primarily due to lower average debt balances[94] - Other (expense) income, net, decreased by $13 million to $(3) million, mainly due to higher foreign exchange losses and lower equity income[95] Freight Segment (Third Quarter) Freight Segment Performance (Q3 YoY) | Item | Q3 2024 (Millions) | Q3 2023 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Net Sales | $1,930 | $1,881 | $49 | 2.6% | | Income from Operations | $390 | $325 | $65 | 20.0% | | Income from Operations (% of Net Sales) | 20.2% | 17.3% | 2.9 pts | N/A | - Organic sales increased by $58 million, driven by higher deliveries of locomotive modernizations and engine overhauls (Services) and increased international sales in Digital Intelligence[99][100] - Equipment sales decreased due to lower locomotive deliveries, partially offset by increased mining sales[100] - Cost of sales as a percentage of Net sales decreased by 2.6 percentage points, attributed to favorable mix and strong productivity[101] Transit Segment (Third Quarter) Transit Segment Performance (Q3 YoY) | Item | Q3 2024 (Millions) | Q3 2023 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $733 | $669 | $64 | 9.6% | | Income from Operations | $79 | $70 | $9 | 12.9% | | Income from Operations (% of Net Sales) | 10.8% | 10.3% | 0.5 pts | N/A | - Organic sales increased by $56 million, driven by strong Original Equipment Manufacturing and Aftermarket sales due to increased demand and investments in sustainable infrastructure[106][107] - Cost of sales as a percentage of sales decreased by 1.0 percentage point, benefiting from structured cost actions through Integration 2.0 and prior restructuring projects[108] Consolidated Results (Nine Months) Consolidated Net Sales and Profitability (9 Months YoY) | Item | 9 Months 2024 (Millions) | 9 Months 2023 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Net Sales | $7,804 | $7,151 | $653 | 9.1% | | Gross Profit | $2,569 | $2,180 | $389 | 17.8% | | Income from Operations | $1,275 | $958 | $317 | 33.1% | | Net Income Attributable to Wabtec Shareholders | $844 | $600 | $244 | 40.7% | - Organic sales increased by $597 million, and sales from acquisitions contributed $72 million[112][114] - Cost of sales as a percentage of Net sales improved to 67.1% in 9M 2024 from 69.5% in 9M 2023, due to improved pricing, favorable mix, productivity, and fixed cost absorption[115] - Interest expense, net, decreased by $15 million to $148 million, primarily due to lower average debt balances, partially offset by higher effective interest rates[117] - Other (expense) income, net, decreased by $18 million to $(1) million, mainly due to lower equity income[118] Freight Segment (Nine Months) Freight Segment Performance (9 Months YoY) | Item | 9 Months 2024 (Millions) | 9 Months 2023 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Net Sales | $5,674 | $5,134 | $540 | 10.5% | | Income from Operations | $1,149 | $820 | $329 | 40.1% | | Income from Operations (% of Net Sales) | 20.2% | 16.0% | 4.2 pts | N/A | - Organic sales increased by $486 million, driven by Services (locomotive modernizations, engine overhauls, parts sales) and Equipment (North American and international locomotive sales, mining sales)[122][123] - Acquisitions contributed $72 million to Freight Segment sales, primarily from L&M Radiator, Inc[123] - Cost of sales as a percentage of Net sales decreased by 3.0 percentage points, attributed to improved pricing, favorable mix, and productivity[124] Transit Segment (Nine Months) Transit Segment Performance (9 Months YoY) | Item | 9 Months 2024 (Millions) | 9 Months 2023 (Millions) | Change (Millions) | % Change | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $2,130 | $2,017 | $113 | 5.6% | | Income from Operations | $235 | $208 | $27 | 13.0% | | Income from Operations (% of Net Sales) | 11.0% | 10.3% | 0.7 pts | N/A | - Organic sales increased by $111 million, driven by strong Original Equipment Manufacturing and Aftermarket sales due to increased demand and investments in sustainable infrastructure[129] - Cost of sales as a percentage of sales decreased by 0.7 percentage points, primarily due to favorable mix and benefits from Integration 2.0 and prior restructuring projects[130] Liquidity and Capital Resources Cash Flow Summary (9 Months Ended Sep 30) | Activity | 2024 (Millions) | 2023 (Millions) | | :--- | :--- | :--- | | Operating activities | $1,111 | $515 | | Investing activities | $(106) | $(336) | | Financing activities | $(1,209) | $(323) | - The significant increase in cash provided by operating activities was driven by a $246 million increase in Net income, $137 million from changes in Accounts payable, $122 million from favorable changes in Accounts receivables, and $86 million from changes in Inventory[133] - Cash used for financing activities increased due to $974 million in stock repurchases and $106 million in dividend payments[133] - As of September 30, 2024, the Company held approximately $410 million of cash, cash equivalents, and restricted cash, with $401 million held outside the United States[133] - Net cash proceeds from the revolving receivables program were $75 million for the nine months ended September 30, 2024, compared to $155 million in the prior year[134] - A new uncommitted bilateral money market line credit agreement for $150 million was entered into during Q3 2024 for general business purposes and working capital needs[136] - The stock repurchase program was reauthorized to $1 billion on February 9, 2024, with approximately $123 million remaining as of September 30, 2024[146] Forward Looking Statements - Statements other than historical facts are forward-looking and based on current expectations, but assumptions may not be correct[147] - Forward-looking statements are subject to various risks and uncertainties, including economic and industry conditions (e.g., inflation, supply chain, demand), operating factors (e.g., labor, legal, acquisitions), competitive factors, political/governmental factors, and natural hazards/health crises[147][149] - The Company undertakes no obligation to update any statement to reflect events or circumstances after the date on which the statement is made, except as required by law[149] Critical Accounting Estimates - Judgment is used in critical accounting estimates such as accounts receivable, allowance for doubtful accounts, inventories, business combinations, goodwill and indefinite-lived intangible assets, warranty reserves, income taxes, and revenue recognition[150] - There have been no significant changes in the related accounting policies since December 31, 2023[150] Contractual Obligations - The Company entered into a new $225 million term loan (2024 Credit Agreement) maturing March 14, 2029[152] - Issued $500 million of Senior Notes due 2034, with proceeds used to repay the outstanding 2024 Notes at maturity, increasing long-term debt contractual obligations for 2029 and beyond to $725 million[152] - A new uncommitted bilateral money market line credit agreement for $150 million was entered into during Q3 2024[152] Item 3. Quantitative and Qualitative Disclosures about Market Risk Market risk exposure remains materially unchanged since December 31, 2023, with details in Note 13 - The Company's exposure to market risk has not changed materially since December 31, 2023[154] - Refer to Note 13 for additional information regarding interest rate and foreign currency exchange risk[154] Item 4. Controls and Procedures Disclosure controls and procedures were effective as of September 30, 2024, with no material changes to internal control - Wabtec's principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures are effective as of September 30, 2024[155] - No material changes in internal control over financial reporting occurred during the quarter ended September 30, 2024[156] PART II—OTHER INFORMATION Item 1. Legal Proceedings This section refers to Note 14 of the financial statements for detailed information regarding the company's legal proceedings - Additional information with respect to legal proceedings is included in Note 14 of "Notes to Condensed Consolidated Financial Statements"[158] Item 1A. Risk Factors There have been no material changes to the company's risk factors since the Annual Report on Form 10-K for the year ended December 31, 2023 - There have been no material changes in risk factors from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023[159] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Details Q3 2024 common stock repurchases and the reauthorized $1 billion stock repurchase program Issuer Purchases of Common Stock (Q3 2024) | Month | Total Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | July 2024 | 555,587 | $161.88 | | August 2024 | 1,501,329 | $156.30 | | September 2024 | 1,627,298 | $168.99 | | Total quarter ended September 30, 2024 | 3,684,214 | $162.75 | - The Board of Directors reauthorized its stock repurchase program to $1 billion on February 9, 2024, superseding the previous $750 million authorization[160] - Approximately $123 million remained under the stock repurchase plan as of September 30, 2024[160] Item 4. Mine Safety Disclosures This item is not applicable to the company - Not Applicable[161] Item 5. Other Information No changes were made to trading plans by the company's Directors or Officers during the third quarter ended September 30, 2024 - None of Wabtec's Directors or Officers adopted, terminated, or materially modified any trading plans during the third quarter ended September 30, 2024[161] Item 6. Exhibits This section lists the exhibits accompanying the report, which include certifications from the CEO and CFO, as well as various XBRL documents for interactive data filing - The exhibits filed with this report include a list of subsidiary guarantors, Rule 13a-14(a) Certifications of the Chief Executive Officer and Chief Financial Officer, Section 1350 Certification, and various Inline XBRL Taxonomy Extension Documents[163] Signatures