First quarter net income of $1.5 million was up $3.6 million over last year; EBITDA1 of $5.2 million was up $3.3 million over last year driven by volume and strong gross profit expansion; Selling and administrative expenses as a percentage of sales were 19.0% for the quarter, favorable 240 bps versus last year.
Cash flow used in operations in the quarter was $10.4 million, a $15.7 million improvement over last year; Gross Leverage Ratio1 was 1.2x at quarter end significantly improved compared to 2.5x last year.
2026 financial guidance reaffirmed with sales growth and profitability expansion expected for the year.
PITTSBURGH, May 04, 2026 (GLOBE NEWSWIRE) -- L.B. Foster Company (NASDAQ:FSTR), a global technology solutions provider of products and services for the rail and infrastructure markets (the "Company"), today reported its 2026 first quarter operating results.
First Quarter 2026 Highlights
Three Months EndedMarch 31,
Change
2026
2025
2026 vs. 2025
$ in thousands, unless otherwise noted:
(Unaudited)
Net sales
$
121,144
$
97,792
23.9
%
Operating income (loss)
2,045
(1,923
)
206.3
%
Net income (loss) attributable to L.B. Foster Company
1,500
(2,110
)
171.1
%
EBITDA1
5,157
1,822
183.0
%
Net cash used in operating activities
(10,438
)
(26,136
)
60.1
%
Free Cash Flow1
(13,398
)
(28,711
)
53.3
%
Total debt
59,684
82,498
(27.7
)%
Gross Leverage Ratio1
1.2x
2.5x
(1.3
)x
New orders, net1
$
142,086
$
149,064
(4.7
)%
Backlog1
$
209,573
$
237,215
(11.7
)%
Financial Guidance Update
2026 Full Year Financial Guidance
Low
High
Net sales
$
540,000
$
580,000
Adjusted EBITDA1
$
41,000
$
46,000
Capital spending as a percent of sales
~2.7
%
~2.7
%
Free Cash Flow1
$
15,000
$
25,000
CEO Comments
John Kasel, President and Chief Executive Officer, commented, "We carried the favorable momentum generated at the end of 2025 into our first quarter, posting strong growth and profitability expansion across the business. Both segments delivered exceptional results in the quarter, led by Rail sales growth of 38.4%, reflecting a strong recovery in domestic Rail demand compared to last year's weaker start to the year. Sales volumes were higher across all Rail business units, with Rail Products and Friction Management up 40.8% and 39.5%, respectively. Technology Services and Solutions ("TS&S") sales were also up 29.1% on increased short-term project work in the United Kingdom ("UK"). Infrastructure segment sales were up 5.9% on continuing robust demand for Precast Concrete with sales up 17.2% over last year, partially offset by 14.4% lower Steel Products sales due to soft bridge forms volume."
Mr. Kasel continued, "The strong sales volume growth delivered robust profitability improvement over last year, with EBITDA of $5.2 million up $3.3 million, or 183.0%. Consolidated gross margins of 21.2% improved 60 bps over last year with the improvement realized in Infrastructure, reflecting higher volumes, improved business mix, and better manufacturing execution in our Precast Concrete business. Rail gross margins were slightly lower due to the significantly higher Rail Distribution sales volumes this year. We continued leveraging our operating cost structure, with selling and administrative expenses as a percentage of sales declining 240 bps to 19.0%. This is despite a $0.7 million accelerated non-cash stock compensation expense related to management equity plan awards made to retirement-eligible employees. Our normal working capital cycle increased total debt $16.9 million during the quarter to $59.7 million. However, total debt was down $22.8 million compared to last year, with the lower debt level and improved profitability reducing gross leverage to 1.2x compared to 2.5x last year."
Mr. Kasel concluded, "As expected, we're off to a great start to the year and remain optimistic about our prospects for continuing progress in 2026. While the first quarter backlog is down 11.7% compared to last year, order rates increased significantly in the back half of the quarter resulting in a 10.7% increase in backlog during the quarter. Project bidding activity has been robust and we believe order rates will continue to improve as the year progresses. The government funding programs that support our customer project work remain active, and there are no signs of disruption in funding like we experienced last year. We're also seeing early signs that the actions we've taken in the UK Rail business are translating into improvements in 2026. Accordingly, we're reaffirming our financial guidance for 2026, with the midpoints for sales and Adjusted EBITDA representing year over year growth of 3.7% and 11.3%, respectively. It should be noted that our guidance assumes the current volatile geopolitical landscape does not have a significant impact on the domestic economy. We'll continue to monitor market conditions and adjust as needed."
1 See "Non-GAAP Disclosures" at the end of this press release for a description of and information regarding EBITDA, Adjusted EBITDA, gross leverage ratio per the Company's credit agreement, new orders, net, backlog, book-to-bill ratio, free cash flow, and related reconciliations to the comparable United States Generally Accepted Accounting Principles financial measures.
First Quarter 2026 Consolidated Results
The Company's first quarter performance highlights are reflected below:
Three Months EndedMarch 31,
Change
Percent Change
2026
2025
2026 vs. 2025
2026 vs. 2025
$ in thousands, unless otherwise noted:
(Unaudited)
Net sales
$
121,144
$
97,792
$
23,352
23.9
%
Gross profit
25,696
20,151
5,545
27.5
Gross profit margin
21.2
%
20.6
%
60 bps
2.9
Selling and administrative expenses
$
23,033
$
20,952
$
2,081
9.9
Selling and administrative expenses as a percent of sales
19.0
%
21.4
%
(240) bps
(11.2
)
Amortization expense
618
1,122
(504
)
(44.9
)
Operating income (loss)
$
2,045
$
(1,923
)
$
3,968
206.3
Net income (loss) attributable to L.B. Foster Company
1,500
(2,110
)
3,610
171.1
EBITDA1
5,157
1,822
3,335
183.0
New orders, net1
142,086
149,064
(6,978
)
(4.7
)
Backlog1
209,573
237,215
(27,642
)
(11.7
)
Net sales for the 2026 first quarter increased $23.4 million, or 23.9%, over the prior year quarter. The increase was driven by sales growth in Rail, Technologies, and Services ("Rail") of $20.8 million, or 38.4%, with Infrastructure Solutions ("Infrastructure") sales also improving $2.6 million, or 5.9%.
Gross profit for the 2026 first quarter increased $5.5 million, or 27.5%, over the prior year quarter driven primarily by higher volumes in Rail which improved $4.1 million, and improved volumes and business mix in Infrastructure which contributed $1.4 million. Gross profit margins improved 60 basis points to 21.2%.
Selling and administrative expenses for the 2026 first quarter increased $2.1 million, or 9.9%, over the prior year quarter, primarily due to higher personnel costs driven by merit increases, higher variable incentives, and a $0.7 million accelerated non-cash stock compensation expense related to management equity plan awards made to retirement-eligible employees. Selling and administrative expenses as a percentage of net sales decreased 240 basis points to 19.0%.
Operating income for the 2026 first quarter improved $4.0 million, or 206.3%, over the prior year quarter. The improvement was primarily driven by higher gross profit partially offset by increased selling and administrative expenses.
Net income attributable to the Company for the 2026 first quarter improved $3.6 million, or 171.1%, over the prior year quarter due to improved gross profit. The Company's income tax provision for the 2026 first quarter includes a discrete tax benefit associated with a higher tax deduction for vested management equity awards.
There were no adjustments to EBITDA in the first quarter of 2026 or 2025. EBITDA for the 2026 first quarter increased $3.3 million, or 183.0%, over the prior year quarter.
Cash used in operating activities totaled $10.4 million in the 2026 first quarter, favorable $15.7 million compared to cash used in operating activities of $26.1 million in the prior year quarter.
Total debt as of March 31, 2026 was $59.7 million, a decrease of $22.8 million from the prior year quarter due primarily to improved free cash flow. Total debt increased $16.9 million during the quarter due primarily to seasonal working capital requirements and annual incentive and insurance premiums. The Company's Gross Leverage Ratio per its credit facility was 1.2x as of March 31, 2026, down from 2.5x last year, reflecting higher profitability and disciplined capital deployment.
New orders, net for the 2026 first quarter decreased $7.0 million, or 4.7%, from the prior year quarter, with the decrease realized in both segments. The trailing twelve month book-to-bill ratio1 was 0.95 : 1.00. Backlog decreased $27.6 million, or 11.7%, from the prior year quarter driven in part by an order cancellation last year in the Infrastructure segment which declined 26.1%. This was partially offset by an 11.3% increase in the Rail segment backlog. During the quarter, backlog increased $20.2 million, or 10.7%, with order book increases realized in both segments.
First Quarter 2026 Business Results by Segment
Rail, Technologies, and Services Segment
Three Months EndedMarch 31,
Change
Percent Change
$ in thousands, unless otherwise noted:
2026
2025
2026 vs. 2025
2026 vs. 2025
Net sales
$
