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美國

證券交易委員會

華盛頓特區 20549

____________________________________

表格 10-Q

____________________________________

☒			根據1934年證券交易法第13或15(d)條款的季度報告。

截至2024年6月30日季度結束 2024年9月30日

或

☐			根據1934年證券交易法第13或15(d)條款的過渡報告

為過渡期從                    至                    

委員會文件號碼： 033-90866

____________________________________

美國西屋制動技術

公司

（註冊人的確切姓名，如其章程中指明）

____________________________________

特拉華州									25-1615902
(成立地或組織其他管轄區)									（聯邦稅號）
伊莎貝拉街30號 匹茲堡, 賓夕法尼亞									15212
(總部辦公地址)									（郵遞區號）

412-825-1000

(註冊人的電話號碼，包括區號)

無適用

(如自上次報告以來有更改，請提供前名稱、前地址和前財政年度)

____________________________________

根據法案第12(b)條規定註冊的證券：

Class A普通股			交易標的（s）			每個註冊交易所的名稱
每股普通股，每股面值0.01美元			標的			紐約證券交易所

請以核對標記來表示此登記人（1）在過去12個月內（或該登記人要求提交此等報告的較短期間內）已提交證券交易法案第13或15（d）條要求提交的所有報告，並且（2）在過去90天內一直受到此提交要求的適用。是  ☒    沒有 ☐

標示勾勾，以表明在過去的12個月內（或在被要求提交此類文件的較短期間內）登記人是否根據Regulation S-t第405條規定提交了每個互動數據文件。是  ☒不☐

請以勾選標記表示是否登記者是大型加速遞交者、加速遞交者、非加速遞交者、較小的報表公司或新興成長公司。參閱《交易所法》第120億2條中對「大型加速遞交者」、「加速遞交者」、「較小的報表公司」和「新興成長公司」的定義。

大型加速歸檔人

☒

加速歸檔人

☐

非加速歸檔人

☐

新興成長型企業

☐

較小報告公司

☐

如屬新興成長型企業，請勾選表示公司未選擇使用根據《交易所法》第13(a)條提供的任何新的或修訂的財務會計標準進行遵從的延長過渡期。 ☐  

勾選是表示申報人是殻牌公司（如《交易所法》第1202條所定義）。 是☐不☒

請指明每個發行人普通股類別截至最近可行日期的股份總數。

截至2024年10月18日，公司尚有 171,889,624 公司的普通股，每股面值為$.01，已發行。

---

威斯汀豪斯空氣制動

TECHNOLOGIES 公司

2024年9月30日

表格10-Q

目錄

						頁面
			第一部分 - 財務資訊
項目 1。			Financial Statements - (Unaudited)			3
			截至 September 2024年12月31日及2023年12月31日			3
			三個月及年度綜合損益表 9 2024年6月30日 九月 30、2024和2023年			4
			三個月及年2024和2023年總合綜合收益表 9 2024年6月30日 九月 30、2024和2023年			5
			合併現金流量表为 9 2024年6月30日 September 30、2024和2023年			6
			Condensed Consolidated Statements of Shareholders' Equity for the three and 9 2024年6月30日 九月 30、2024和2023年			7
			基本報表註記			9
項目2。			管理層對財務狀況和業績的討論與分析			28
第3項目。			有關市場風險的定量和定性披露			46
項目 4。			內部控制及程序			46
			第二部份──其他資訊
項目 1。			法律訴訟			47
第1項事項			風險因素			47
項目2。			未註冊股權證券的銷售 和 資金用途s			47
項目 4。			礦業安全披露			47
項目5。			其他信息			47
第六項。			展品			48
			簽名			49

2

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第一部分—財務資訊

項目 1. 基本報表

美國西屋制動科技公司

縮短的合併資產負債表

			未經核實的
以百萬為單位，除了票面價值			九月三十日， 2024						12月31日， 2023
資產
資產
現金、約略等同於現金及受限制的現金			$	410					$	620
應收帳款			1,231						1,160
未計費應收賬款			551						524
存貨淨值			2,380						2,284
其他流動資產			202						267
流動資產總額			4,774						4,855
不動產、廠房及設備，淨額			1,439						1,485
商譽			8,786						8,780
其他无形资产，净额			2,996						3,205
其他非流動資產			649						663
總非流動資產			13,870						14,133
總資產			$	18,644					$	18,988
負債及股東權益
負債
應付帳款			$	1,338					$	1,250
客戶存款			567						804
應付員工薪酬			380						341
應計保固			244						220
長期債務的當期償還			500						781
其他應計負債			652						660
流動負債總額			3,681						4,056
長期負債			3,517						3,288
應計退休金和養老金福利			62						62
週轉所得稅			295						318
其他長期負債			798						740
總負債			8,353						8,464
承諾與或然性 （14.注）
股權
0.01.01 面額為0.0001； 500.0 授權股份和 226.9 已發行股份： 171.9 和 177.8 截至2024年9月30日和2023年12月31日，其餘資產分別淨值。			2						2
額外認股資本金			7,999						7,977
按成本核算的庫藏股 55.0 和 49.1 股份，截至2024年9月30日及2023年12月31日，分別。			(3,151)						(2,171)
保留盈餘			6,007						5,269
累積其他全面虧損			(607)						(590)
美國西屋制動科技公司總股東權益			10,250						10,487
非控制權益			41						37
總權益			10,291						10,524
負債合計及權益			$	18,644					$	18,988

附註是這些報表的重要組成部分。

3

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美國西屋制動科技公司

綜合綜合損益表

			未經核實的												未經核實的
			結束於三個月的期間 九月三十日，												九個月結束了 九月三十日，
以百萬為單位，除每股數據外			2024						2023						2024						2023
淨銷售額：
商品銷售			$	2,171					$	2,048					$	6,323					$	5,631
服務銷售			492						502						1,481						1,520
總淨銷售額			2,663						2,550						7,804						7,151
銷貨成本：
貨品成本			(1,512)						(1,475)						(4,413)						(4,132)
服務成本			(271)						(283)						(822)						(839)
銷售總成本			(1,783)						(1,758)						(5,235)						(4,971)
毛利潤			880						792						2,569						2,180
營業費用：
銷售、一般及管理費用			(318)						(295)						(915)						(843)
工程費用			(50)						(53)						(155)						(157)
攤銷費用			(79)						(74)						(224)						(222)
營業費用總計			(447)						(422)						(1,294)						(1,222)
營業收入			433						370						1,275						958
其他收入和支出：
利息費用，淨額			(52)						(60)						(148)						(163)
其他（支出）收入，淨額			(3)						10						(1)						17
稅前收入			378						320						1,126						812
所得稅支出			(92)						(78)						(272)						(204)
凈利潤			286						242						854						608
減：非控制權益的淨收益			(3)						(2)						(10)						(8)
歸屬於Wabtec股東的凈利潤			$	283					$	240					$	844					$	600
每股盈利
基礎
歸屬於Wabtec股東的凈利潤			$	1.63					$	1.34					$	4.81					$	3.34
稀釋
歸屬於Wabtec股東的凈利潤			$	1.63					$	1.33					$	4.80					$	3.33
加權平均流通股數
基礎			173.4						178.6						175.1						179.1
稀釋			174.1						179.2						175.7						179.7

 

隨附的附註是這些報表的不可或缺的一部分。

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美國西屋制動科技公司

濃縮合並綜合收益基本報表

			未審計												未審計
			截至三個月 九月三十日												截至九個月 九月三十日
以百萬爲單位			2024						2023						2024						2023
歸屬於Wabtec股東的凈利潤			$	283					$	240					$	844					$	600
外幣翻譯收益（損失）			114						(106)						(23)						(82)
衍生合同的未實現（損失）收益			(2)						21						11						39
養老金和養老福利計劃未實現收益（損失）變動			1						3						(3)						1
稅前其他綜合收益（虧損）			113						(82)						(15)						(42)
與其他綜合收益元件相關的所得稅費用			—						(7)						(2)						(10)
其他綜合收入（損失），扣除稅後			113						(89)						(17)						(52)
歸屬於Wabtec股東的綜合收益			$	396					$	151					$	827					$	548

 

The accompanying notes are an integral part of these statements.

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WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

			Unaudited
			Nine Months Ended September 30,
In millions			2024						2023
Operating Activities
Net income			$	854					$	608
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			375						371
Stock-based compensation expense			44						36
Below market intangible amortization			(34)						(39)
Net loss on disposal of property, plant and equipment			2						4
Changes in operating assets and liabilities, net of acquisitions and dispositions:
Accounts receivable and unbilled accounts receivable			(92)						(214)
Inventories			(115)						(201)
Accounts payable			87						(50)
Accrued income taxes			33						(6)
Accrued liabilities and customer deposits			(172)						12
Other assets and liabilities			129						(6)
Net cash provided by operating activities			1,111						515
Investing Activities
Purchase of property, plant and equipment			(123)						(109)
Proceeds from dispositions of businesses			17						—
Proceeds from disposal of property, plant and equipment			13						—
Acquisitions of businesses, net of cash acquired			(13)						(227)
Net cash used for investing activities			(106)						(336)
Financing Activities
Proceeds from debt, net of issuance costs			1,872						4,351
Payments of debt			(1,934)						(4,302)
Repurchase of stock			(974)						(252)
Cash dividends			(106)						(92)
Payment of contingent consideration			(42)						—
Payment of income tax withholding on share-based compensation			(24)						(16)
Distribution to noncontrolling interest			(6)						(12)
Other financing activities			5						—
Net cash used for financing activities			(1,209)						(323)
Effect of changes in currency exchange rates			(6)						(5)
Decrease in cash			(210)						(149)
Cash, cash equivalents and restricted cash, beginning of period			620						541
Cash, cash equivalents and restricted cash, end of period			$	410					$	392

 

The accompanying notes are an integral part of these statements.

 

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美國西屋制動科技公司

簡化合並股東權益基本報表

(未經審計)

以百萬爲單位						普通股股份						普通股金額						追加實收資本						庫藏股股份						國債庫存金額						留存收益						累計其他全面收益虧損						非控股權益						總計
截至2023年12月31日的餘額						226.9						$	2					$	7,977					(49.1)						$	(2,171)					$	5,269					$	(590)					$	37					$	10,524
現金分紅（$0.20 每股股息)						—						—						—						—						—						(36)						—						—						(36)
期權和其他福利計劃執行後發行的庫藏股所得款項，扣除稅款後						—						—						(22)						0.3						2						—						—						—						(20)
基於股票的補償						—						—						12						—						—						—						—						—						12
凈利潤						—						—						—						—						—						272						—						5						277
其他綜合損失，稅後淨額						—						—						—						—						—						—						(77)						—						(77)
股票回購						—						—						—						(1.3)						(176)						—						—						—						(176)
餘額，2024年3月31日						226.9						$	2					$	7,967					(50.1)						$	(2,345)					$	5,505					$	(667)					$	42					$	10,504
現金分紅（$0.20 每股股息)						—						—						—						—						—						(35)						—						—						(35)
通過期權和其他福利計劃行使出售的庫藏股收益，扣除稅費後的淨額						—						—						—						0.1						2						—						—						—						2
基於股票的補償						—						—						14						—						—						—						—						—						14
凈利潤						—						—						—						—						—						289						—						2						291
其他綜合損失，稅後淨額						—						—						—						—						—						—						(53)						—						(53)
股票回購						—						—						—						(1.3)						(202)						—						—						—						(202)
分配給非控制性利益						—						—						—						—						—						—						—						(1)						(1)
餘額，2024年6月30日						226.9						$	2					$	7,981					(51.3)						$	(2,545)					$	5,759					$	(720)					$	43					$	10,520
現金分紅（$0.20 每股股息)						—						—						—						—						—						(35)						—												(35)
從行使期權和其他福利計劃中發行的庫存股票所得，扣除稅後						—						—						—						—						(1)						—						—						—						(1)
基於股票的補償						—						—						18						—						—						—						—						—						18
凈利潤						—						—						—						—						—						283						—						3						286
其他綜合收益，扣除稅費						—						—						—						—						—						—						113						—						113
股票回購						—						—						—						(3.7)						(605)						—						—						—						(605)
分配給非控制性利益						—						—						—						—						—						—						—						(5)						(5)
餘額，2024年9月30日						226.9						$	2					$	7,999					(55.0)						$	(3,151)					$	6,007					$	(607)					$	41					$	10,291

7

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以百萬爲單位						普通股股份						普通股金額						追加實收資本						庫藏股股份						國債庫存金額						留存收益						累計其他全面收益虧損						非控股權益						總計
截至2022年12月31日的餘額						226.9						$	2					$	7,953					(45.7)						$	(1,769)					$	4,577					$	(661)					$	45					$	10,147
現金分紅（$0.17 每股股息)						—						—						—						—						—						(31)						—						—						(31)
從期權和其他福利計劃的行使中發行的國庫股票所得，扣除稅款後						—						—						(23)						0.3						6						—						—						—						(17)
基於股票的補償						—						—						10						—						—						—						—						—						10
凈利潤						—						—						—						—						—						169						—						4						173
其他綜合收益，扣除稅費						—						—						—						—						—						—						30						—						30
股票回購						—						—						—						(1.7)						(178)						—						—						—						(178)
餘額，2023年3月31日						226.9						$	2					$	7,940					(47.1)						$	(1,941)					$	4,715					$	(631)					$	49					$	10,134
現金分紅（$0.17 每股股息)						—						—						—						—						—						(31)						—						—						(31)
從行使期權和其他福利計劃發行的庫存股票收入，減去稅款						—						—						(3)						0.1						3						—						—						—						—
基於股票的補償						—						—						12						—						—						—						—						—						12
凈利潤						—						—						—						—						—						191						—						2						193
其他綜合收益，扣除稅費						—						—						—						—						—						—						7						—						7
股票回購						—						—						—						(0.8)						(76)						—						—						—						(76)
分配給非控制性利益						—						—						—						—						—						—						—						(12)						(12)
截至2023年6月30日的餘額						226.9						$	2					$	7,949					(47.8)						$	(2,014)					$	4,875					$	(624)					$	39					$	10,227
現金分紅（$0.17 每股股息)						—						—						—						—						—						(30)						—						—						(30)
從期權和其他福利計劃中行使的國庫股票所產生的收益，扣除稅後淨額						—						—						2						—						1						—						—						—						3
基於股票的補償						—						—						14						—						—						—						—						—						14
凈利潤						—						—						—						—						—						240						—						2						242
其他綜合損失，稅後淨額						—						—						—						—						—						—						(89)						—						(89)
截至2023年9月30日的餘額						226.9						$	2					$	7,965					(47.8)						$	(2,013)					$	5,085					$	(713)					$	41					$	10,367

附訴說明是這些財務報表不可或缺的一部分。

8

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美國西屋制動科技公司

基本報表附註

截至2024年9月30日的季度（未經審計）

1. 業務

除非上下文另有要求，否則對「我們」、「我們的」、「我們」、「公司」和「Wabtec」的所有引用均指的是美國西屋制動科技公司及其合併子公司。對「母公司」的引用僅指美國西屋制動科技公司。Wabtec是一個全球提供增值科技基礎的機車、設備、系統和服務的供應商，服務於貨運鐵路和客運交通行業，以及礦業、海洋和工業市場。我們的高端工程產品旨在增強安全性、提高生產力並降低客戶的維護成本，可以在全球大多數機車、貨車、客運車輛和公交車上找到。我們的核心產品和服務對於貨運鐵路和客運交通工具的安全高效事件控制項至關重要。Wabtec是一家全球性公司，在超過 50 個國家開展業務，我們的產品在全球超過 100 個國家可以找到。在2024年前九個月，公司的淨銷售額約有 52%來自美國以外的客戶。

2. 會計政策

財務報表的基礎 未經審計的簡明合併中期基本報表已按照美國公認會計原則（"GAAP"）以及證券交易委員會的規章制度編制，幷包含Wabtec及其子公司的賬戶，其中Wabtec擁有控股權。這些簡明合併中期基本報表未包含完整基本報表所需的所有信息和腳註。在管理層看來，這些基本報表反映了爲了公平呈現所需的所有正常、經常性性質的調整。某些前年度金額已根據需要進行重新分類，以符合當前年度的報告。

這些期間的結果並不一定能代表全年的結果，特別是在考慮到由於供應鏈中斷、勞動可得性、普遍的通貨膨脹以及區域衝突帶來的影響而導致的宏觀經濟環境持續波動的情況下。這些因素持續影響着我們的銷售渠道、供應鏈、製造業操作、勞動力以及其他關鍵操作方面。由於對這些因素的持續時間和嚴重性的高度不確定性，以及它們對全球經濟活動可能產生的影響，以及當前和新的制裁對我們的業務、全球供應鏈操作以及我們的客戶、供應商和終端市場可能產生的影響，我們無法合理預測這些因素的全面影響。

公司按照四-四-五週的會計季度運營，季度結束於3月31日、6月30日、9月30日和12月31日左右。

本指引中的說明應與Wabtec公司截至2023年12月31日的年度報告表格10-K中包含的經審計合併基本報表一起閱讀。2023年12月31日的信息已來自於公司截至2023年12月31日的年度報告表格10-K。

估計的使用 根據美國普遍接受會計原則(GAAP)準備基本報表要求公司做出影響財務報表日期資產和負債報告金額以及報告期間收入和支出報告金額的估計和假設。實際金額可能與估計有所不同。管理層會根據當前可用的信息持續審查其估計。事實和情況的變化可能導致估計的修訂。

收入確認 公司的大部分營業收入來自於在控制權轉移給客戶時一次性滿足的履約義務。其餘的營業收入是在一段時間內獲得的。通常，對於在某一時點滿足的履約義務，控制權在根據約定的交付條款發貨時轉移。

公司還與客戶簽署了長期協議，涉及設計和生產高度工程化的產品，這些產品因沒有替代用途而需逐步確認營業收入，因爲它們在合同終止的情況下，客戶有權獲得合理的利潤率。同時，公司還與客戶簽署了涉及創建或增強客戶控制的資產的協議，這些協議也要求逐步確認營業收入。一般來說，公司使用輸入法來確定這些客戶協議的營業收入、成本和毛利率。在這些協議中使用的輸入方法包括材料和勞動力成本，這兩者準確反映了在滿足特定履行義務方面所取得的進展。公司還可能使用輸出法，根據直接測量轉移給客戶的價值來確認營業收入。合同收入和成本估算在全年內定期審查和修訂，調整將在會計期間內按確定的金額反映。

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由於需要在公司的長期項目上執行的工作性質，對最終營業收入和營業成本的估算受到許多變量的影響，並需要重大判斷。與長期項目相關的合同估算基於各種假設，以預測可能跨越數年的未來事件的結果。這些假設包括材料成本；勞動力的可用性和生產率；要執行的工作的複雜性；以及可能與合同相關的供應商、客戶和分包商的表現。我們有一個嚴謹的流程，管理層定期審查長期項目的進展。在這個過程中，管理層審查的信息包括關鍵合同事項、完成進度、識別的風險和機會，以及可能影響公司營業收入和成本估算的其他信息。在完成此分析後，任何對淨銷售、營業成本的調整，以及對營業收入的相關影響，都會在其變爲已知的期間內必要時確認。

一般來說，公司的營業收入包含每個獨特商品或服務的一項單一履約義務；然而，一份合同可能包含多項履約義務，涉及對顧客的多重承諾。當存在多項履約義務時，營業收入是基於相對的獨立出售價格進行分配的。定價在我們的合同中是按逐項列出，並在個別客戶合同條款要求時包括可變對價的估算。公司通常具有的可變對價類型包括成交量折扣、及時付款折扣、價格上調條款、清算損害賠償和績效獎金。銷售退貨和折讓也在相關收入確認的同一時期進行估計和確認，這基於公司的經驗和未來預期。

剩餘履約義務代表未滿足或部分滿足的履約義務的分配交易價格。 截至2024年9月30日，公司剩餘的履約義務約爲$22.2 十億。公司預計在接下來的 34%的剩餘履約義務將在接下來的 12 個月內確認，剩餘部分隨後確認。

循環應收賬款計劃 公司利用循環融資工具出售高達$350 百萬的某些應收賬款，公司及其某些子公司（"發起人"）。發起人將應收賬款貢獻給我們破產隔離子公司，該子公司定期將應收賬款出售給金融機構，以換取等於所售應收賬款總額的現金。破產隔離子公司是一個具有獨立法律地位的實體，擁有自己的債權人，其資產不能用於償還公司或公司任何其他附屬公司的債權人。當客戶支付餘額時，我們會將額外的應收賬款轉入該計劃，這可能導致我們所售的應收賬款總額高於或低於在任何適用期間內匯款給金融機構的客戶收款。出售的應收賬款由我們的破產隔離子公司全額擔保，該子公司持有額外的應收賬款作爲本融資工具的抵押品。公司已同意擔保發起人在循環協議下的各自義務的履行。除上述破產隔離合並子公司外，公司及發起人均不保證循環協議下應收賬款的可收回性。

截至2024年9月30日和2023年12月31日，該破產隔離子公司持有的應收款爲$646百萬和$674百萬，這些款項已包含在公司的簡明合併資產負債表中。破產隔離子公司持有的應收款作爲所售未償還應收款的擔保，金額爲 $95百萬 和 $20百萬 截至2024年9月30日和2023年12月31日，分別爲。轉讓按收到的對價公允價值及承擔的義務與註銷的應收款之差進行記錄。 截至2024年9月30日或2023年12月31日未記錄任何義務，因爲對出售應收款的預計信用損失微不足道。 我們對這些轉讓應收款項相關損失的最大敞口僅限於未償還的金額。

下表總結了銷售應收款項的情況以及對現金流量中的淨現金收入的影響：

以百萬爲單位			截至九個月 2024年9月30日						截至九個月 2023年9月30日
銷售的總應收款/收到的現金收入			$	926					$	2,030
客戶向金融機構匯出的款項			(851)						(1,875)
包括在運營現金中的淨現金收入			$	75					$	155

受限現金 截至2024年9月30日和2023年12月31日，公司將現金分類爲$9百萬和$5百萬，分別作爲因收購而在託管中限制使用的現金。

折舊費用 與產品或服務提供的製造業相關的物業、廠房和設備的折舊包含在商品成本或服務成本中。與產品或服務提供無關的其他物業、廠房和設備的折舊包含在銷售、一般和管理費用中。

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費用或工程費用，在財產、廠房和設備用於研究和開發目的的範圍內。

探針卡 商譽和其他無限期的無形資產不進行 amortization。其他具有確定期限的無形資產按其預計經濟生命以固定線性基礎進行 amortization。可 amortization 的無形資產在存在減值跡象時進行減值審查。公司在報告單元層面及每年至少一次對商譽和無限期的無形資產進行減值測試。公司在年度預測過程完成後於第四季度進行年度減值測試，並且在發生事件或情況變化表明賬面價值可能無法恢復時，也會進行減值測試。公司將進行定性或定量的商譽測試，並至少每三年對每個識別的報告單元進行一次定量測試。公司管理層定期評估是否存在減值跡象，以決定是否需要進行減值分析。在本季度未發現減值跡象。

最近發佈的會計準則 在2023年11月，財務會計準則委員會（"FASB"）發佈了會計準則更新（"ASU"）2023-07， segment reporting (主題 280): 可報告分部披露的改進本次更新中的修訂旨在改進可報告部門的披露要求，主要是通過增強對重要部門費用的披露。除了當前的要求外，修訂還規定必須提供關於首席運營決策者（"CODM"）的附加信息，以及細分的費用類別，前提是CODM在決定如何分配資源時使用這些數據。本次更新中的修訂不影響費用的確認、計量或財務報表的呈現，並將於2024年1月1日起生效，適用於Wabtec的年度報告期，以及自2025年1月1日起生效的中期報告期。這些修訂將要求在公司年度和中期備案中增加對當前和可比報告期間的中期和年度披露。

在2023年12月，FASB發佈了ASU 2023-09， 所得稅（主題740）：所得稅披露的改進本次更新的修訂要求實體在年度基礎上披露特定類別的所得稅率調節，併爲滿足定量閾值的調節項目提供額外信息。本次更新的修訂還要求對所得稅支付和所得稅費用的披露進行更深入的分類，以及其他變更。本次更新的修訂不會影響所得稅的確認、計量或財務報表的呈現，並將於2025年1月1日起生效於Wabtec的年度報告期。這些修訂將要求在年度和中期公司備案中，增加對當前及可比報告期間的年度披露。公司正在評估這些修訂對其未來備案的影響程度。

累積其他綜合損失綜合（損失）收益包括凈利潤和其他來自非所有者來源的交易及其他事件和情況所引起的權益變動的其他綜合（損失）收益。

截至2024年和2023年9月30日的三個月內，各組成部分的累計其他綜合虧損的變動，包括任何稅收影響，如下所示：

			外幣折算									衍生合約									養老金和退休後福利計劃									總計
以百萬爲單位			2024			2023						2024			2023						2024			2023						2024			2023
截至6月30日的餘額			$	(678)		$	(572)					$	17		$	4					$	(59)		$	(56)					$	(720)		$	(624)
稅後其他綜合收益(虧損)			114			(106)						(1)			16						—			1						113			(89)
截止到九月三十日的餘額			$	(564)		$	(678)					$	16		$	20					$	(59)		$	(55)					$	(607)		$	(713)

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截至2024年和2023年9月30日的九個月內，各組成部分累計其他綜合損失的變動，包括任何稅務影響，如下所示：

			外幣折算									衍生合約									養老金和退休後福利計劃									總計
以百萬爲單位			2024			2023						2024			2023						2024			2023						2024			2023
年初餘額			$	(541)		$	(596)					$	7		$	(9)					$	(56)		$	(56)					$	(590)		$	(661)
重新分類前綜合（損失）收益			(23)			(82)						9			29						—			—						(14)			(53)
從其他綜合（損失）收入中重新分類的金額			—			—						—			—						(3)			1						(3)			1
其他綜合（損失）收益，淨			(23)			(82)						9			29						(3)			1						(17)			(52)
截至九月三十日的餘額			$	(564)		$	(678)					$	16		$	20					$	(59)		$	(55)					$	(607)		$	(713)

從其他綜合損失累計重分類的金額在合併財務報表的「其他（費用）收入，淨額」中確認，稅務影響在「所得稅費用」中確認。

供應鏈融資計劃 公司已與第三方金融機構達成供應鏈融資協議，爲我們的供應商提供增強的付款選項，同時爲公司提供額外的營運資金靈活性。公司在這些協議下不提供任何擔保，對我們供應商的自願參與沒有經濟利益，也不從金融機構獲得經濟收益，並且在協議下沒有資產被抵押。這些協議不改變公司與供應商協商的應付款條款，區間爲淨 45 和淨 180 天，並且不會導致應付款項在簡化合並資產負債表中分類的變化。供應商利用該計劃加快從這些金融機構收取對公司截至2024年9月30日和2023年12月31日的未償應付款總額爲338百萬和$305百萬美元。根據該計劃的供應商發票需按照與供應商商定的公司正常條款和條件全額支付給金融機構。

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3. ACQUISITIONS

On December 22, 2023, the Company purchased the remaining ownership shares of Lokomotiv Kurastyru Zauyty ("LKZ"), a locomotive manufacturing and assembly company located in Kazakhstan, at which time it became a wholly owned subsidiary of the Company. Prior to this purchase, Wabtec owned 50% of LKZ as a joint venture partner and accounted for its ownership interest as an equity method investment. Total purchase price for the remaining 50% interest was $111 million. Upon acquisition, Wabtec's previously held equity interest balance was remeasured to fair value and the Company ceased accounting for the investment using the equity method and recognized 100% of LKZ's identifiable assets and liabilities. LKZ's results of operations and cash flows have been fully consolidated subsequent to the acquisition date.

The following table summarizes the fair value of 100% of the LKZ assets acquired and liabilities assumed:

In millions
Assets acquired
Cash and cash equivalents			$	30
Accounts receivable			6
Inventory			95
Property, plant and equipment			36
Goodwill			111
Other noncurrent assets			3
Total assets acquired			281
Liabilities assumed
Current liabilities			21
Noncurrent liabilities			3
Total liabilities assumed			24
Net assets acquired			$	257

The fair values of the assets acquired and liabilities assumed were determined using the income, cost and market approaches. These estimates are preliminary in nature and subject to adjustments, which could be material as the Company has not completed its valuation of acquired assets and liabilities. Any necessary adjustments will be finalized within one year from the date of acquisition.

Goodwill was calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of the net assets acquired and represents the assembled workforce and the future economic benefits of expanding our global operations expected to be achieved as a result of the acquisition. The purchased goodwill is not expected to be deductible for tax purposes. The results of this business since the date of acquisition are reported within the Equipment product line of the Freight Segment. The pro forma impact on Wabtec’s sales and results of operations, including the pro forma effect of events that are directly attributable to the acquisition, was not significant.

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During the second quarter of 2023, the Company acquired L&M Radiator, Inc., a leading manufacturer of heavy-duty equipment radiators and heat exchangers for the mining sector, for a purchase price of approximately $245 million.

The following table summarizes the fair value of the L&M Radiator, Inc. assets acquired and liabilities assumed:

In millions
Assets acquired
Cash and cash equivalents			$	16
Accounts receivable			20
Inventory			26
Other current assets			1
Property, plant and equipment			43
Goodwill			106
Other intangible assets			89
Other noncurrent assets			1
Total assets acquired			302
Liabilities assumed
Current liabilities			16
Noncurrent liabilities			41
Total liabilities assumed			57
Net assets acquired			$	245

The fair values of the assets acquired and liabilities assumed were determined using the income, cost and market approaches. Discounted cash flow models were used to estimate the fair values of acquired intangibles. The fair value measurements were primarily based on significant inputs that are not observable in the market and are considered Level 3 in the fair value hierarchy. Intangible assets acquired include customer relationships and acquired technology that are subject to amortization, and trade names that were assigned an indefinite life and are not subject to amortization.

Goodwill was calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of the net assets acquired, and represents the assembled workforce and the future economic benefits, including synergies, that are expected to be achieved as a result of the acquisition. The purchased goodwill is not expected to be deductible for tax purposes. The results of this business since the date of acquisition are reported within the Components product line of the Freight Segment. The pro forma impact on Wabtec’s sales and results of operations, including the pro forma effect of events that are directly attributable to the acquisition, was not significant.

The Company also made smaller acquisitions during the periods presented, none of which were material.

4. INVENTORIES

The components of inventory, net of reserves, were:

In millions			September 30, 2024						December 31, 2023
Raw materials			$	1,028					$	1,062
Work-in-progress			590						463
Finished goods			762						759
Total inventories			$	2,380					$	2,284

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5. GOODWILL AND INTANGIBLE ASSETS

The change in the carrying amount of goodwill by segment is as follows:

In millions			Freight Segment						Transit Segment						Total
Balance at December 31, 2023			$	7,294					$	1,486					$	8,780
Additions/adjustments			9						—						9
Foreign currency impact			(23)						20						(3)
Balance at September 30, 2024			$	7,280					$	1,506					$	8,786

As of September 30, 2024 and December 31, 2023, the Company’s trade names had a net carrying amount of $619 million and $612 million, respectively. The Company believes these intangibles have indefinite lives, with the exception of the right to use the GE Transportation trade name, to which the Company had assigned a useful life of 5 years and has been fully amortized.

Intangible assets of the Company, other than goodwill and trade names, consist of the following:

						September 30, 2024																		December 31, 2023
In millions						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount
Backlog						$	1,433					$	(605)					$	828					$	1,431					$	(526)					$	905
Customer relationships						1,322						(481)						841						1,333						(431)						902
Acquired technology						1,296						(588)						708						1,283						(497)						786
Total						$	4,051					$	(1,674)					$	2,377					$	4,047					$	(1,454)					$	2,593

At September 30, 2024 the weighted average remaining useful lives of backlog, customer relationships and acquired technology were 7 years, 14 years and 6 years, respectively. The backlog intangible asset primarily consists of in-place long-term service agreements acquired by the Company in conjunction with the acquisition of GE Transportation. Amortization expense for intangible assets was $79 million and $224 million for the three and nine months ended September 30, 2024, respectively, and $74 million and $222 million for the three and nine months ended September 30, 2023, respectively.

Amortization expense for the five succeeding years is estimated to be as follows:

In millions
Remainder of 2024			$	70
2025			$	272
2026			$	267
2027			$	262
2028			$	261

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6. CONTRACT ASSETS AND CONTRACT LIABILITIES

Contract assets include unbilled amounts resulting from sales under long-term contracts where revenue is recognized over time and revenue exceeds the amount that can be billed to the customer based on the terms of the contract. The current portion of the contract assets are classified as current assets under the caption “Unbilled accounts receivable” while the noncurrent contract assets are classified as other assets under the caption "Other noncurrent assets" on the Condensed Consolidated Balance Sheets. Noncurrent contract assets were $175 million at September 30, 2024 and $154 million at December 31, 2023. The Company has elected to use the practical expedient and does not consider unbilled amounts anticipated to be paid within one year as significant financing components.

Contract liabilities include customer deposits that are made prior to the incurrence of costs related to a newly agreed upon contract and advanced customer payments that are in excess of revenue recognized. The current portion of contract liabilities are classified as current liabilities under the caption “Customer deposits” while the noncurrent contract liabilities are classified as noncurrent liabilities under the caption "Other long-term liabilities" on the Condensed Consolidated Balance Sheets. Noncurrent contract liabilities were $319 million at September 30, 2024 and $174 million at December 31, 2023. These contract liabilities are not considered a significant financing component because they are used to meet working capital demands that can be higher in the early stages of a contract or revenue associated with the contract liabilities is expected to be recognized within one year. Contract liabilities also include provisions for estimated losses from uncompleted contracts. Provisions for loss contracts were $89 million and $104 million at September 30, 2024 and December 31, 2023, respectively. These provisions for estimated losses are classified as current liabilities and included within the caption “Other accrued liabilities” on the Condensed Consolidated Balance Sheets.

The change in the carrying amount of contract assets and contract liabilities for the nine months ended September 30, 2024 and 2023 is as follows:

			Contract Assets
In millions			2024						2023
Balance at beginning of year			$	678					$	706
Recognized in current year			549						562
Reclassified to accounts receivable			(496)						(456)
Acquisitions/adjustments			—						(2)
Foreign currency impact			(5)						(4)
Balance at September 30			$	726					$	806
			Contract Liabilities
In millions			2024						2023
Balance at beginning of year			$	1,082					$	956
Recognized in current year			1,021						1,043
Amounts in beginning balance reclassified to revenue			(513)						(632)
Current year amounts reclassified to revenue			(615)						(393)
Acquisitions			—						1
Foreign currency impact			—						(6)
Balance at September 30			$	975					$	969

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7. LEASES

The Company leases certain property, buildings and equipment. For leases with terms greater than 12 months, the Company records the related asset and obligation at the present value of lease payments. Many of the Company's leases include rental escalation clauses, renewal options, and/or termination options that are factored into our determination of lease payments when appropriate. The right-of-use assets are classified as noncurrent and included within the caption "Other noncurrent assets" on the Condensed Consolidated Balance Sheets. The current portion of lease liabilities are classified under the caption "Other accrued liabilities," while the noncurrent portion of lease liabilities are classified under the caption "Other long-term liabilities" on the Condensed Consolidated Balance Sheets. The Company does not separate lease and non-lease components. As most of the Company's leases do not provide a readily stated discount rate, the Company must estimate the rate to discount lease payments using its incremental borrowing rate.

Operating lease expense was $18 million and $50 million for the three and nine months ended September 30, 2024, respectively, and $16 million and $48 million for the three and nine months ended September 30, 2023, respectively. New operating leases of $8 million and $40 million were added during the three and nine months ended September 30, 2024, respectively, and $7 million and $27 million for the three and nine months ended September 30, 2023, respectively. Wabtec does not have material financing leases, short-term or variable leases or sublease income.

Scheduled payments of lease liabilities are as follows:

In millions			Operating Leases
Remaining 2024			$	17
2025			61
2026			54
2027			43
2028			32
Thereafter			110
Total lease payments			317
Less: Present value discount			(27)
Present value of lease liabilities			$	290

The following table summarizes the remaining lease term and discount rate assumptions used to develop the present value of operating lease liabilities:

			September 30, 2024						December 31, 2023
Weighted-average remaining lease term (years)			7.2						7.8
Weighted-average discount rate			2.8		%				2.4		%

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8. LONG-TERM DEBT

Long-term debt consisted of the following:

			Effective Interest Rate						Face Value						September 30, 2024												December 31, 2023
In millions															Book Value						Fair Value1						Book Value						Fair Value1
2024 Credit Agreement:
Term Loan			6.7		%				$	225					$	224					$	225					$	—					$	—
2022 Credit Agreement:
Revolving Credit Facility			8.6		%				N/A						—						—						—						—
Delayed Draw Term Loan			6.7		%				$	250					250						250						250						250
Senior Notes:
4.15% Senior Notes, due 2024			—		%				$	—					—						—						725						722
3.20% Senior Notes, due 2025			3.4		%				$	500					499						494						499						484
3.45% Senior Notes, due 2026			3.5		%				$	750					750						738						749						718
1.25% Senior Notes (EUR), due 2027			1.5		%				€	500					552						527						547						509
4.70% Senior Notes, due 2028			4.8		%				$	1,250					1,246						1,269						1,245						1,237
5.611% Senior Notes, due 2034			5.7		%				$	500					495						529						—						—
Other Borrowings															1						1						54						57
Total															4,017						4,033						4,069						3,977
Less: current portion															(500)						(495)						(781)						(779)
Long-term portion															$	3,517					$	3,538					$	3,288					$	3,198

1. See Note 13 for information on the fair value measurement of the Company's long-term debt.

Variances between Face Value and Book Value are the result of unamortized discounts and debt issuance fees as well as foreign exchange on the Euro Notes. Amortization of discounts and debt issuance fees are included in the calculation of Effective Interest Rate.

For those debt securities that have a premium or discount at the time of issuance, the Company amortizes the amount through interest expense based on the maturity date or the first date the holders may require the Company to repurchase the debt securities, if applicable. A premium would result in a decrease in interest expense, and a discount would result in an increase in interest expense in future periods. Additionally, the Company has debt issuance costs related to certain financing transactions which are also amortized through interest expense. As of September 30, 2024 and December 31, 2023, the Company had total combined unamortized discount and debt issuance costs of $17 million and $15 million, respectively.

Credit Agreements

2024 Credit Agreement

On March 14, 2024, the Company entered into a new stand-alone credit agreement (the "2024 Credit Agreement") for a term loan of $225 million. Borrowings under the 2024 Credit Agreement bear interest at a base rate plus an interest rate spread up to 1.75% based on the lower of the pricing corresponding to (i) the Company’s Leverage Ratio or (ii) the Company’s public rating. At September 30, 2024, the interest rate was 6.5%. The frequency of interest payments varies based upon the Interest Election Request. The term loan issued under the 2024 Credit Agreement will mature on March 14, 2029. The obligations of the Company under the 2024 Credit Agreement are unsecured and have been guaranteed by certain of the Company’s subsidiaries. The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type.

Under the 2024 Credit Agreement, the Company has agreed to maintain an Interest Coverage Ratio of at least 3.0 to 1.0, and a Leverage Ratio not to exceed 3.5 to 1.0. The Interest Coverage Ratio is calculated using an earnings metric as defined in the agreement compared to Interest Expense for the four quarters then ended. The Leverage Ratio is defined as net debt (total debt, net of up to $300 million of unrestricted cash) as of the last day of such fiscal quarter to the defined earnings metric for the four quarters then ended. Additionally, the Company may effect an increase in the maximum Leverage Ratio in contemplation of a Material Acquisition. All terms are as defined in the 2024 Credit Agreement.

2022 Credit Agreement

On August 15, 2022, the Company entered into a new unsecured credit agreement (the "2022 Credit Agreement"). The 2022 Credit Agreement provides for borrowings consisting of (i) a multi-currency revolving credit facility, providing for an equivalent in U.S. dollars of up to $1.5 billion (the “Revolving Credit Facility”) and (ii) a $250 million delayed draw term loan facility (the “Delayed Draw Term Loan”), all pursuant to the terms and conditions of the 2022 Credit Agreement. The 2022

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Credit Agreement allows the Company to request, at prevailing market rates, an aggregate amount not to exceed $750 million, (a) increases to the borrowing commitments under the Revolving Credit Facility and/or (b) new incremental term loan commitments. The agreement contains affirmative, negative and financial covenants, and events of default customary for facilities of this type.

The Revolving Credit Facility matures on August 15, 2027. The Delayed Draw Term Loan was fully drawn during the third quarter of 2023, and the proceeds were utilized to redeem the 4.375% Senior Notes, due 2023. Borrowings under the Delayed Draw Term Loan will mature on August 15, 2027. Amounts borrowed and repaid under the Delayed Draw Term Loan may not be reborrowed. The applicable interest rate for borrowings under the 2022 Credit Agreement includes a base rate (per the Interest Election terms of the agreement) plus an interest rate spread up to 1.75% based on the lower of the pricing corresponding to (i) the Company’s financial leverage or (ii) the Company’s public rating. At September 30, 2024, the interest rate was 6.5%. Obligations under the Restated Credit Agreement have been guaranteed by certain of the Company’s subsidiaries.

Under the 2022 Credit Agreement, the Company has agreed to maintain an Interest Coverage Ratio of at least 3.0 to 1.0, and a Leverage Ratio not to exceed 3.5 to 1.0. The Interest Coverage Ratio is calculated using an earnings metric as defined in the agreement compared to Interest Expense for the four quarters then ended. The Leverage Ratio is defined as net debt (total debt, net of up to $300 million of unrestricted cash) as of the last day of such fiscal quarter to the defined earnings metric for the four quarters then ended. Additionally, the Company may effect an increase in the maximum Leverage Ratio in contemplation of a Material Acquisition. All terms are as defined in the 2022 Credit Agreement.

The following table presents availability under the 2022 Credit Agreement at September 30, 2024:

In millions						Revolving Credit Facility						Delayed Draw Term Loan						Total
Maximum Availability						$	1,500					$	250					$	1,750
Outstanding Borrowings						—						(250)						(250)
Letters of Credit Under Credit Agreement						—						—						—
Current Availability						$	1,500					$	—					$	1,500

The Company was in compliance with all financial covenants in the 2022 Credit Agreement and the 2024 Credit Agreement as of September 30, 2024.

Intra-Quarter Uncommitted Money Market Line Credit Agreement

During the third quarter of 2024, the Company entered into an uncommitted bilateral money market line credit agreement which provides an aggregate borrowing capacity of $150 million, for general business purposes and working capital needs within a quarter.

Senior Notes

The Company or its subsidiaries may issue senior notes from time to time. These notes are comprised of our 4.15% Senior Notes due 2024 (the "2024 Notes"), 3.20% Senior Notes due 2025 (the "2025 Notes"), 3.45% Senior Notes due 2026 (the "2026 Notes"), 1.25% Senior Notes (EUR) due 2027 (the "Euro Notes"), 4.70% Senior Notes due 2028 (the "2028 Notes"), and 5.611% Senior Notes due 2034 (the "2034 Notes"). The 2024 Notes, 2025 Notes, 2026 Notes, 2028 Notes, and 2034 Notes are the “US Notes”, and collectively with the Euro Notes, the “Senior Notes.” Interest on the US Notes is payable semi-annually and interest on the Euro Notes is paid annually. Each series of the Senior Notes may be redeemed at any time in whole or from time to time in part in accordance with the provisions of the indenture, under which such series of notes was issued. Each of the Senior Notes may be redeemed at a redemption price of 100% of the principal amount plus a specified make-whole premium and accrued interest. The US Notes and the Company's guarantee of the Euro Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt, and are senior to all existing and future subordinated indebtedness of the Company.

On March 11, 2024, the Company issued $500 million of 5.611% Senior Notes due in 2034 (2034 Notes). The 2034 Notes were issued at 100% of face value and the Company recognized approximately $5 million of total deferred financing costs. Interest on the 2034 Notes will accrue at a rate of 5.611% per year, payable semi-annually on March 11 and September 11 of each year, commencing September 11, 2024. The 2034 Notes will mature on March 11, 2034.

Proceeds from the 2034 Notes, combined with the proceeds from the term loan under the 2024 Credit Agreement and cash on hand, were utilized to repay the outstanding amount of 2024 Notes at maturity.

Beginning September 15, 2023, the effective interest rates for the 2024 Notes and the 2028 Notes were each reduced by 0.25% due to a favorable change in Wabtec's corporate credit rating and the rating of the aforementioned notes.

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The indentures under which the Senior Notes were issued contain covenants and restrictions which limit, subject to certain exceptions, certain sale and leaseback transactions with respect to principal properties, the incurrence of secured debt without equally and ratably securing the Senior Notes, and certain merger and consolidation transactions. The covenants do not require the Company to maintain any financial ratios or specified levels of net worth or liquidity. The US Notes are fully and unconditionally guaranteed, jointly and severally, on an unsecured basis by each of the Company's subsidiaries that is a guarantor under the 2022 Credit Agreement and the 2024 Credit Agreement. The Euro Notes were issued by Wabtec Transportation Netherlands B.V. and are fully and unconditionally guaranteed by the Parent Company.

The Company is in compliance with the restrictions and covenants in the indentures under which the Senior Notes were issued and expects that these restrictions and covenants will not be any type of limiting factor in executing our operating activities.

9. STOCK-BASED COMPENSATION

The Company maintains employee stock-based compensation plans for stock options, restricted stock, and incentive stock units as governed by the 2011 Stock Incentive Compensation Plan, as amended and restated (the “2011 Plan”) and the 2000 Stock Incentive Plan, as amended (the “2000 Plan”). The 2011 Plan has a term through May 10, 2027, and as of September 30, 2024, the number of shares available for future grants under the 2011 Plan was approximately 4.4 million shares. The Company also maintains a 1995 Non-Employee Directors’ Fee and Stock Option Plan as amended and restated (“the Directors Plan”).

Stock-based compensation expense was $23 million and $57 million for the three and nine months ended September 30, 2024, respectively, and $16 million and $42 million for the three and nine months ended September 30, 2023, respectively. At September 30, 2024, unamortized compensation expense related to stock options, non-vested restricted shares and incentive stock units expected to vest was approximately $91 million.

Stock Options Stock options can be granted to eligible employees and directors at an exercise price equal to fair market value, which is the average of the high and low Wabtec stock price on the date of grant. Options become exercisable over a three-year vesting period and expire 10 years from the date of grant. There were no stock options granted in the periods presented. At September 30, 2024, there were 231,026 shares issuable pursuant to exercisable stock options.

Restricted Stock, Restricted Stock Units and Incentive Stock As provided for under the 2011 Plan and 2000 Plan, eligible employees are granted restricted stock that generally vests over three years from the date of grant. Under the Directors Plan, restricted stock awards vest one year from the date of grant. The restricted stock units are liability-classified equity awards as they can be settled in cash.

In addition, the Company has issued incentive stock units to eligible employees that vest upon attainment of certain cumulative three-year performance goals, including a Relative Total Stockholder Return ("RTSR") modifier. The RTSR modifier can increase or decrease the payment by 10% or 20% depending on plan year. Significant judgments and estimates are used in determining the estimated three-year performance, which is then used to estimate the total shares expected to vest over the three-year vesting cycle and corresponding expense based on the grant date fair value of the award. When determining the estimated three-year performance, the Company utilizes a combination of historical actual results, budgeted results and forecasts. Upon the initial grant of a performance cycle, the Company estimates the three-year performance at 100%. Quarterly, the Company reviews and updates performance estimates based on actual performance results and current projections. Based on the Company’s performance for each three-year period then ended, the incentive stock units can vest and be awarded ranging from 0% to 200% of the initial incentive stock units granted. The incentive stock units included in the table below represent the number of incentive stock units that are expected to vest based on the Company’s estimate for meeting those established performance targets. As of September 30, 2024, the Company estimates that it will achieve 158%, 163% and 175% for the incentive stock awards expected to vest, inclusive of the RTSR modifier, based on the estimated performance for the three-year periods ending December 31, 2024, 2025, and 2026, respectively, and has recorded incentive compensation expense accordingly. If the estimates of the number of these incentive stock units expected to vest changes in a future accounting period, cumulative compensation expense could increase or decrease and will be recognized in the current period for the elapsed portion of the vesting period and would change future expense for the remaining vesting period.

Compensation expense for the non-vested restricted stock and incentive stock units is based on the closing price of the Company's common stock on the date of grant and recognized over the applicable vesting period. Expense for incentive stock units is updated as necessary based on the Company's performance.

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The following table summarizes the restricted stock, restricted stock unit and incentive stock unit activity and related information for the nine months ended September 30, 2024:

			Restricted Stock and Units						Incentive Stock Units						Weighted Average Grant Date Fair Value
Outstanding at December 31, 2023			760,569						692,732						$	93.65
Granted			309,241						193,661						$	142.43
Vested			(276,957)						(298,756)						$	87.81
Adjustment for incentive stock awards expected to vest			—						190,451						$	117.62
Canceled			(43,086)						(19,852)						$	104.93
Outstanding at September 30, 2024			749,767						758,236						$	114.70

10. INCOME TAXES

The overall effective tax rate for the three and nine months ended September 30, 2024 was 24.2% and 24.1%, respectively. The overall effective tax rate for the three and nine months ended September 30, 2023 was 24.5% and 25.1%, respectively. The year over year decrease in the effective rate for the three month period ended September 30, 2024 was driven by a change in the jurisdictional mix of earnings and audit closures. Additionally, the year over year decrease in the effective tax rate for the nine month period ended September 30, 2024 was impacted by higher discrete equity compensation tax deductions, audit closures, and a change in jurisdictional mix of earnings.

11. EARNINGS PER SHARE

The computation of basic and diluted earnings per share for Net income attributable to Wabtec shareholders is as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
In millions, except per share data			2024						2023						2024						2023
Numerator
Net income attributable to Wabtec shareholders			$	283					$	240					$	844					$	600
Denominator
Weighted average shares outstanding - basic			173.4						178.6						175.1						179.1
Effect of dilutive securities:
Assumed conversion of dilutive stock-based compensation plans			0.7						0.6						0.6						0.6
Weighted average shares outstanding - diluted			174.1						179.2						175.7						179.7
Net income attributable to Wabtec shareholders per common share
Basic			$	1.63					$	1.34					$	4.81					$	3.34
Diluted			$	1.63					$	1.33					$	4.80					$	3.33

12. WARRANTIES

The following table reconciles the changes in the Company’s product warranty reserve for the nine months ended September 30, 2024 and 2023:

In millions			2024						2023
Balance at beginning of year			$	248					$	242
Warranty expense			84						76
Warranty claim payments			(63)						(70)
Foreign currency impact/other			2						(1)
Balance at September 30			$	271					$	247

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13. FAIR VALUE MEASUREMENT AND DERIVATIVE INSTRUMENTS

ASC 820 “Fair Value Measurements and Disclosures” defines fair value, establishes a framework for measuring fair value and explains the related disclosure requirements. ASC 820 indicates, among other things, that a fair value measurement assumes that the transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability and defines fair value based upon an exit price model.

Valuation Hierarchy. ASC 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.

The Company’s cash, cash equivalents and restricted cash are highly liquid investments purchased with an original maturity of three months or less and are considered Level 1 on the fair value valuation hierarchy. The fair value of cash, cash equivalents and restricted cash approximated the carrying value at September 30, 2024 and December 31, 2023. The Senior Notes are considered Level 2 based on the fair value valuation hierarchy. Contingent consideration related to the GE Transportation acquisition is considered Level 3 based on the fair value valuation hierarchy. At December 31, 2023, $42 million was classified as "Other accrued liabilities" on the Company's Condensed Consolidated Balance Sheets, which approximates fair value. There was no amount of contingent consideration outstanding as of September 30, 2024.

Hedging Activities In the normal course of business, the Company is exposed to market risk related to interest rates, commodity prices and foreign currency exchange rate fluctuations, which may adversely affect our operating results and financial position. At times, we limit these risks through the use of derivatives such as cross-currency swaps, foreign currency forward contracts, interest rate swaps, commodity swaps and options. These hedging contracts are valued using broker quotations, or market transactions in either the listed or over-the-counter markets. As such, these derivative instruments are classified within Level 2. In accordance with our policy, derivatives are only used for hedging purposes. We do not use derivatives for trading or speculative purposes.

Foreign Currency Exchange Risk

The Company uses forward contracts to hedge forecasted foreign currency denominated sales of finished goods and future settlement of foreign currency denominated assets and liabilities. Derivatives used to hedge firm commitments relevant to sales and purchases and forecasted transactions to be realized with high probability that meet the criteria for hedge accounting are designated as cash flow hedges. The effective portion of gains and losses is deferred as a component of Accumulated other comprehensive loss and is recognized in earnings at the time the hedged item affects earnings, in the same line item as the underlying hedged item. For the three and nine months ended September 30, 2024 and 2023, the amounts reclassified into income were not material.

The Company has also established balance sheet risk management and net investment hedging programs to protect its balance sheet against foreign currency exchange rate volatility. We conduct our business worldwide in U.S. dollars and the functional currencies of our foreign subsidiaries, including euro, Indian rupee, British pound sterling, Australian dollars and several other foreign currencies. Changes in these foreign currency exchange rates could have a material adverse impact on our financial results that are reported in U.S. dollars. We are also exposed to foreign currency exchange rate risk related to our foreign subsidiaries, including intercompany loans denominated in non-functional currencies. We hedge these exposures using foreign currency swap contracts and cross-currency swaps to offset the potential income statement effects on intercompany loans denominated in non-functional currencies. These programs reduce but do not eliminate foreign currency exchange rate risk entirely.

The Company enters into certain derivative contracts in accordance with its risk management strategy that do not meet the criteria for hedge accounting, but which have the impact of largely mitigating foreign currency exposure. These foreign exchange contracts are accounted for on a full mark to market basis through earnings, with gains and losses recorded as a component of Other (expense) income, net. The net gains and losses related to these contracts were not material for the three and nine months ended September 30, 2024 and 2023. These contracts typically mature within one year.

Interest Rate Risk

The Company may use interest rate hedge contracts on certain investing and borrowing transactions to manage its net exposure to interest rate changes and to manage its overall cost of borrowing. The Company does not use leveraged swaps and, in general, does not leverage any of its investment activities that would put principal capital at risk. During the first quarter of

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2024, the Company utilized all outstanding interest rate hedge contracts to help manage interest expense for the 2034 Notes. In the third quarter of 2024, the Company entered into new interest rate hedge contracts to manage interest rate risk for a portion of future expected debt transactions. For the three and nine months ended September 30, 2024 and 2023, the amounts reclassified into income were not material.

Commodity Price Risk

The Company may use commodity forward swaps to manage its exposure to commodity price changes and to reduce its overall cost of manufacturing. For the three and nine months ended September 30, 2024 and 2023, the amounts recognized as income or expense were not material.

The following table summarizes the assets, liabilities, gross notional amounts, fair values, and fair value hierarchy classification of the designated and non-designated hedges discussed in the above sections as of September 30, 2024, which are included in other current assets and liabilities on the Condensed Consolidated Balance Sheets:

									Fair Value												Gross Notional Amount
In millions			Level						Designated						Non-Designated						Designated						Non-Designated
Foreign Exchange Contracts
Other current assets			2						$	4					$	2					$	255					$	156
Other current liabilities			2						(6)						—						329						89
Interest Rate Contracts
Other current assets			2						—						—						20						—
Other current liabilities			2						—						—						20						—
Total									$	(2)					$	2					$	624					$	245

The following table summarizes the assets, liabilities, gross notional amounts, fair values, and fair value hierarchy classification of the designated and non-designated hedges discussed in the above sections as of December 31, 2023, which are included in other current assets and liabilities on the Condensed Consolidated Balance Sheets:

									Fair Value												Gross Notional Amount
In millions			Level						Designated						Non-Designated						Designated						Non-Designated
Foreign Exchange Contracts
Other current assets			2						$	6					$	3					$	319					$	110
Other current liabilities			2						(12)						(3)						655						200
Interest Rate Contracts
Other current assets			2						10						—						250						—
Total									$	4					$	—					$	1,224					$	310

14. COMMITMENTS AND CONTINGENCIES

The Company is subject to a variety of environmental laws and regulations governing discharges to air and water, the handling, storage and disposal of hazardous or solid waste materials and the remediation of contamination associated with releases of hazardous substances. The Company believes its operations currently comply in all material respects with all of the various environmental laws and regulations applicable to our business; however, there can be no assurance that environmental requirements will not change in the future or that we will not incur significant costs to comply with such requirements.

Claims have been filed against the Company and certain of its affiliates in various jurisdictions across the United States by persons alleging bodily injury as a result of exposure to asbestos-containing products. The vast majority of the claims are submitted to insurance carriers for defense and indemnity, or to non-affiliated companies that retain the liabilities for the asbestos-containing products at issue. We cannot, however, assure that all of these claims will be fully covered by insurance, or that the indemnitors or insurers will remain financially viable. Our ultimate legal and financial liability with respect to these claims, as is the case with other pending litigation, cannot be estimated. A limited number of claims are not covered by insurance, nor are they subject to indemnity from non-affiliated parties. Management believes that the costs of the Company’s asbestos-related cases will not be material to the Company’s overall financial position, results of operations and cash flows.

During the third quarter of 2023, a competitor of the Company, Progress Rail (“Progress”), which is a Caterpillar Inc. company, sued the Company in the U.S. District Court for the District of Delaware asserting antitrust, breach of contract, unfair competition law, and misrepresentation claims. The complaint challenges the Wabtec-GE Transportation merger and contends

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that since the merger, Wabtec has unlawfully monopolized the markets for long-haul freight locomotives, Tier IV long-haul freight locomotives, and energy management systems by, among other things, failing to ensure that Progress’ products are interoperable with Wabtec’s locomotives and cab electronics. The case is currently at an early stage. Progress seeks an order requiring Wabtec to divest GE Transportation, unspecified treble damages for its alleged lost profits from reduced sales of locomotive and cab systems, and attorneys’ fees and costs. It also asks the court to enjoin Wabtec from engaging in the conduct and require the Company to comply with its agreements with Progress. Wabtec intends to vigorously defend itself against this lawsuit and believes that it has meritorious defenses to the claims asserted by Progress.

Xorail, Inc., a wholly owned subsidiary of the Company (“Xorail”), has received notices from Denver Transit Constructors (“DTC”) alleging breach of contract related to the operating of constant warning wireless crossings, and late delivery of the Train Management & Dispatch System (“TMDS”) for the Denver Eagle P3 Project, which is owned by the Denver Regional Transit District ("RTD"). No damages have been asserted for the alleged late delivery of the TMDS, and no formal claim has been filed; Xorail has successfully completed a remediation plan concerning the TMDS issues. With regard to the wireless crossing issue, as of September 8, 2017, DTC alleged that total damages were $37 million through July 31, 2017 and were continuing to accumulate. The majority of the damages stems from a delay in approval of the wireless crossing system by the Federal Railway Administration ("FRA") and the Public Utility Commission ("PUC"), resulting in the use of flaggers at all of the crossings pending approval of the wireless crossing system and certification of the crossings. DTC has alleged that the delay is due to Xorail's failure to achieve constant warning times for the crossings in accordance with the approval requirements imposed by the FRA and PUC. Xorail has denied DTC's assertions, stating that its system satisfied the contractual requirements. Xorail has worked with DTC to modify its system and implement the FRA's and PUC's previously undefined approval requirements; the FRA and PUC have both approved modified wireless crossing system, and as of August 2018, DTC completed the process of certifying the crossings and eliminated the use of flaggers. DTC has not updated its claim notices or alleged damages against Xorail, nor have they filed any formal claim against Xorail. On September 21, 2018, DTC filed a complaint against RTD in Colorado state court for breach of contract related to non-payments and the costs for the flaggers, asserting a change-in-law arising from the FRA/PUC’s new certification requirements. DTC's claim against RTD proceeded to trial on September 21, 2020. On February 10, 2023, the court issued a decision in favor of RTD, denying DTC's damages claim. DTC has filed a Notice of Appeal.

From time to time the Company is involved in litigation relating to claims arising out of its operations in the ordinary course of business. As of the date hereof, the Company is involved in no litigation that the Company believes will have a material adverse effect on its financial condition, results of operations or liquidity.

15. SEGMENT INFORMATION

The Company has two reportable segments—the Freight Segment and the Transit Segment. The key factors used to identify these reportable segments are the organization and alignment of the Company’s internal operations, the nature of the products and services and customer type. The Company's business segments are:

Freight Segment builds, rebuilds, upgrades, and overhauls locomotives, services locomotives and freight cars, and provides a range of component and digital solutions for customers in the freight and transit rail, mining, and marine industries. It also manufactures and services components for new and existing freight cars and locomotives, supplies railway electronics, positive train control equipment, signal design and engineering services, maintenance of way, and provides heat exchange and cooling systems for locomotives and power generation equipment. Customers include large, publicly traded railroads, leasing companies, manufacturers of original equipment such as locomotives and freight cars, and utilities, and also serves companies in the mining, marine, and industrial markets. We refer to sales of both goods, such as spare parts and equipment upgrades, and related services, such as monitoring, maintenance and repairs, as sales in our Services product line.

Transit Segment primarily manufactures and services components for new and existing passenger transit vehicles, typically regional trains, high speed trains, subway cars, light-rail vehicles and buses. It also refurbishes subway cars and provides heating, ventilation, and air conditioning equipment and doors for buses and subway cars. Customers include public transit authorities and municipalities, leasing companies and manufacturers of subway cars and buses around the world.

The Company evaluates its business segments’ operating results based on income from operations. Intersegment sales are accounted for at prices that are generally established by reference to similar transactions with unaffiliated customers. Corporate activities include general corporate expenses, elimination of intersegment transactions, interest income and expense, and other unallocated charges.

During the first quarter of 2024, Company Management determined that certain parts of the business would be better aligned with Management oversight in different product lines. These changes were immaterial to the individual product lines and segments affected, and historical amounts have been reclassified to conform to the current period presentation.

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Segment financial information for the three months ended September 30, 2024 is as follows:

In millions			Freight Segment						Transit Segment						Corporate Activities and Elimination						Total
Sales to external customers			$	1,930					$	733					$	—					$	2,663
Intersegment sales/(elimination)			12						23						(35)						—
Total sales			$	1,942					$	756					$	(35)					$	2,663
Income (loss) from operations			$	390					$	79					$	(36)					$	433
Interest expense and other, net			—						—						(55)						(55)
Income (loss) before income taxes			$	390					$	79					$	(91)					$	378

Segment financial information for the three months ended September 30, 2023 is as follows:

In millions			Freight Segment						Transit Segment						Corporate Activities and Elimination						Total
Sales to external customers			$	1,881					$	669					$	—					$	2,550
Intersegment sales/(elimination)			18						9						(27)						—
Total sales			$	1,899					$	678					$	(27)					$	2,550
Income (loss) from operations			$	325					$	70					$	(25)					$	370
Interest expense and other, net			—						—						(50)						(50)
Income (loss) before income taxes			$	325					$	70					$	(75)					$	320

Segment financial information for the nine months ended September 30, 2024 is as follows:

In millions			Freight Segment						Transit Segment						Corporate Activities and Elimination						Total
Sales to external customers			$	5,674					$	2,130					$	—					$	7,804
Intersegment sales/(elimination)			37						44						(81)						—
Total sales			$	5,711					$	2,174					$	(81)					$	7,804
Income (loss) from operations			$	1,149					$	235					$	(109)					$	1,275
Interest expense and other, net			—						—						(149)						(149)
Income (loss) before income taxes			$	1,149					$	235					$	(258)					$	1,126

Segment financial information for the nine months ended September 30, 2023 is as follows:

In millions			Freight Segment						Transit Segment						Corporate Activities and Elimination						Total
Sales to external customers			$	5,134					$	2,017					$	—					$	7,151
Intersegment sales/(elimination)			47						31						(78)						—
Total sales			$	5,181					$	2,048					$	(78)					$	7,151
Income (loss) from operations			$	820					$	208					$	(70)					$	958
Interest expense and other, net			—						—						(146)						(146)
Income (loss) before income taxes			$	820					$	208					$	(216)					$	812

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Sales to external customers by product line are as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
In millions						2024						2023						2024						2023
Freight Segment:
Services						$	917					$	787					$	2,575					$	2,304
Equipment						513						620						1,609						1,442
Components						296						293						911						825
Digital Intelligence						204						181						579						563
Total Freight Segment						$	1,930					$	1,881					$	5,674					$	5,134
Transit Segment:
Original Equipment Manufacturer						$	349					$	308					$	969					$	931
Aftermarket						384						361						1,161						1,086
Total Transit Segment						$	733					$	669					$	2,130					$	2,017

16. OTHER (EXPENSE) INCOME, NET

The components of Other (expense) income, net are as follows:

						Three Months Ended September 30,												Nine Months Ended September 30,
In millions						2024						2023						2024						2023
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

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17. RESTRUCTURING

During the first quarter of 2022, Wabtec announced a three-year strategic initiative (“Integration 2.0”) to review and consolidate our operating footprint, reduce headcount, streamline the end-to-end manufacturing process, restructure the North America distribution channels, expand operations in low-cost countries, and simplify the business through systems enablement. Through this initiative, Management will also evaluate additional capital investments to further simplify and streamline the business. The Company anticipates that it will incur one-time restructuring charges related to Integration 2.0 of approximately $135 million to $165 million.

A summary of restructuring charges related to the Integration 2.0 initiative is as follows:

			Three Months Ended September 30,												Nine Months Ended September 30,
In millions			2024						2023						2024						2023
Freight Segment:
Cost of goods sold			$	2					$	2					$	6					$	4
Selling, general and administrative expenses			—						1						—						3
Other income, net			—						—						(4)						—
Total Freight Segment			$	2					$	3					$	2					$	7
Transit Segment:
Cost of goods sold			$	5					$	11					$	9					$	17
Selling, general and administrative expenses			3						(1)						9						4
Amortization expense			—						—						2						2
Total Transit Segment			$	8					$	10					$	20					$	23
Total Integration 2.0 restructuring charges			$	10					$	13					$	22					$	30

Total one-time restructuring charges related to Integration 2.0 to date are approximately $140 million, which includes amounts recorded beginning in the fourth quarter 2021, and are primarily for employee-related costs and asset write downs associated with site consolidations in Europe. Cash payments made during the three and nine months ended September 30, 2024 were approximately $5 million and $35 million, respectively. Cash payments made during the three and nine months ended September 30, 2023 were not material.

In addition to Integration 2.0, Wabtec is focused on exiting various low margin product offerings through Portfolio Optimization to improve profitability while reducing manufacturing complexity. Wabtec expects to incur approximately $85 million in net exit charges related to Portfolio Optimization, which will be predominately non-cash asset write downs. Wabtec recorded charges of approximately $8 million and $13 million during the three and nine months ended September 30, 2024, respectively, primarily for asset write downs related to Portfolio Optimization. No charges related to Portfolio Optimization were recorded during the three and nine months ended September 30, 2023. Total one-time restructuring charges related to Portfolio Optimization to date are approximately $41 million.

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Item 2.    MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the information in the unaudited condensed consolidated financial statements and notes thereto included herein and Westinghouse Air Brake Technologies Corporation’s Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in its Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission on February 14, 2024.

OVERVIEW

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. Our highly engineered products, which are intended to enhance safety, improve productivity and reduce maintenance costs for customers, can be found on most locomotives, freight cars, passenger transit cars and buses around the world. Our core products and services are essential in the safe and efficient operation of freight rail and passenger transit vehicles. Wabtec is a global company with operations in over 50 countries and our products can be found in more than 100 countries throughout the world. In the first nine months of 2024, approximately 52% of the Company’s Net sales came from customers outside the United States.

Business Update

During the first nine months of 2024, Wabtec continued to execute on our value creation framework by signing several key agreements including: a multi-year Tier 4 locomotive order in North America for over $600 million, a multi-year locomotive order in Kazakhstan for over $400 million, and a multi-year order for new locomotives in Africa. Additionally, Wabtec won a long-term parts agreement with a Class I railroad for over $300 million, signed its first multi-year service contract with a customer in Brazil worth over $240 million, and secured a long-term parts agreement with a customer in Asia. Operationally, Wabtec began commercial operations for its Green Friction braking solution in Paris and launched the next generation of railcar movers with its Shuttlewagon Commander NXT. Additionally, as a result of Wabtec's strong revenue and profitable growth over the past few years, rating agencies have made the following changes to our credit ratings: both Fitch Ratings and S&P Global Ratings upgraded Wabtec's credit rating from BBB- to BBB with a Stable outlook, and Moody's updated Wabtec's outlook to positive from stable.

During the first quarter of 2022, Wabtec announced Integration 2.0, a three-year strategic initiative to target incremental run rate synergies estimated to be between $75 million and $90 million in 2025. The scope of the review includes consolidating our operating footprint, reducing headcount, streamlining the end-to-end manufacturing process, restructuring the North America distribution channels, expanding operations in low-cost countries and simplifying the business through systems enablement. Management will also consider additional capital investments to further simplify and streamline the business. The Company anticipates that it will incur one-time restructuring charges of approximately $135 million to $165 million related to this initiative, of which approximately $140 million has been incurred through September 30, 2024. Total estimated initiative charges could change based on the specific programs approved or changes to the scope of the review. During the three and nine months ended September 30, 2024, the Company incurred one-time restructuring charges for programs included in the initiative of approximately $10 million and $22 million, respectively, and $13 million and $30 million for the three and nine months ended September 30, 2023, respectively, primarily for employee-related costs and asset write downs associated with site consolidations in Europe. Programs approved to date are expected to result in approximately 15 facility closures and impact up to 1,100 employees.

In addition to Integration 2.0, Wabtec is focused on exiting various low margin product offerings through Portfolio Optimization to improve profitability while reducing manufacturing complexity. Wabtec expects to incur approximately $85 million in net exit charges related to Portfolio Optimization, which will be predominately non-cash asset write downs. Wabtec recorded charges of approximately $8 million and $13 million during the three and nine months ended September 30, 2024, respectively, for asset write downs related to Portfolio Optimization. No charges related to Portfolio Optimization were recorded during the nine months ended September 30, 2023. Total one-time restructuring charges related to Portfolio Optimization to date are approximately $41 million.

Future macroeconomic volatility, supply chain disruptions and labor availability could cause component and raw material shortages resulting in an adverse effect on the timing of the Company’s revenue and cash flows. Additionally, broad-based inflation, metals, energy and other commodity costs, transportation and logistics costs, labor costs, and foreign currency exchange rate fluctuations all continue to impact our results. The Company utilizes various mitigating actions intended to lessen the impact of macroeconomic volatility. These actions include implementing price escalations and surcharges, driving

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operational efficiencies through various cost mitigation efforts and discretionary spend management, strategically sourcing materials, reviewing and modifying distribution logistics, and accelerating integration synergies through Integration 2.0.

During the first quarter of 2024, Company Management determined that certain parts of the business would be better aligned with Management oversight in different product lines. These changes were immaterial to the individual product lines and segments affected, and historical amounts have been reclassified to conform to the current period presentation.

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RESULTS OF OPERATIONS

Consolidated Results

THIRD QUARTER 2024 COMPARED TO THIRD QUARTER 2023

The following table shows our Condensed Consolidated Statements of Operations for the periods indicated.

			Three Months Ended September 30,
In millions			2024						2023
Net sales:
Sales of goods			$	2,171					$	2,048
Sales of services			492						502
Total Net sales			2,663						2,550
Cost of sales:
Cost of goods			(1,512)						(1,475)
Cost of services			(271)						(283)
Total Cost of sales			(1,783)						(1,758)
Gross profit			880						792
Operating expenses:
Selling, general and administrative expenses			(318)						(295)
Engineering expenses			(50)						(53)
Amortization expense			(79)						(74)
Total Operating expenses			(447)						(422)
Income from operations			433						370
Other income and expenses:
Interest expense, net			(52)						(60)
Other (expense) income, net			(3)						10
Income before income taxes			378						320
Income tax expense			(92)						(78)
Net income			286						242
Less: Net income attributable to noncontrolling interest			(3)						(2)
Net income attributable to Wabtec shareholders			$	283					$	240

The following table shows the major components of the change in Net sales in the three months ended September 30, 2024 from the three months ended September 30, 2023:

In millions			Freight Segment						Transit Segment						Total
Third Quarter 2023 Net sales			$	1,881					$	669					$	2,550
Acquisitions			2						—						2
Foreign Exchange			(11)						8						(3)
Organic			58						56						114
Third Quarter 2024 Net sales			$	1,930					$	733					$	2,663

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Net sales

Net sales for the three months ended September 30, 2024 increased by $113 million, or 4.4%, to $2.66 billion compared to the same period in 2023. Organic sales increased $114 million which was attributable to both the Freight and Transit Segments. Freight Services sales increased from higher deliveries of locomotive modernizations and engine overhauls. Digital Intelligence sales increased due to higher international sales, including Positive Train Control ("PTC"), on-board locomotive solutions, and digital mining products. Freight Equipment sales decreased from lower locomotive deliveries, partially offset by increased mining sales. Transit sales increased from higher demand for Original Equipment Manufacturing and Aftermarket products driven by increased investments in sustainable infrastructure.

Cost of sales

Cost of sales for the three months ended September 30, 2024 increased by $25 million, or 1.4%, to $1.78 billion compared to the same period in 2023. The increase is primarily due to the increase in Net sales. Cost of sales as a percentage of Net sales was 67.0% and 69.0% for the three months ended September 30, 2024 and 2023, respectively. The improvement in gross margin is attributable to favorable mix within the Freight segment, strong productivity and the impacts of Integration 2.0. Costs of sales for the three months ended September 30, 2024 and 2023 included $7 million and $13 million, respectively, of restructuring costs, primarily for headcount actions and footprint rationalization related to Integration 2.0 in both years and Portfolio Optimization in 2024.

Operating expenses

Total operating expenses increased $25 million, or 5.9%, for the three months ended September 30, 2024 compared to the same period in 2023, primarily due to the increase in Net sales and higher restructuring costs. Operating expenses as a percentage of sales was 16.8% and 16.5% for the three months ended September 30, 2024 and 2023, respectively. Selling, general and administrative expenses ("SG&A") increased $23 million for the three months ended September 30, 2024 compared to the same period in 2023. The increase is primarily from costs incurred to support the higher sales volume and higher employee compensation and benefit costs, partially offset by the impacts of Integration 2.0. Restructuring costs included in SG&A were $5 million for the three months ended September 30, 2024, primarily for headcount actions and footprint rationalization programs related to Integration 2.0 and Portfolio Optimization. There were no restructuring amounts recorded in SG&A for the three months ended September 30, 2023.

Interest expense, net

Interest expense, net, decreased $8 million to $52 million for the three months ended September 30, 2024 compared to the same period in 2023, primarily due to lower average debt balances in the current period.

Other (expense) income, net

Other (expense) income, net, decreased $13 million from $10 million to $(3) million for the three months ended September 30, 2024 compared to the same period in 2023, primarily due to higher foreign exchange losses and lower equity income.

Income taxes

The effective income tax rate was 24.2% and 24.5% for the three months ended September 30, 2024 and 2023, respectively. The year over year decrease was primarily driven by a change in the jurisdictional mix of earnings for the three months ended September 30, 2024 and audit closures.

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Freight Segment

The following table shows our Condensed Consolidated Statements of Operations for our Freight Segment for the periods indicated:

			Three Months Ended September 30,
In millions			2024						2023						Change						% Change
Net sales:
Sales of goods			$	1,440					$	1,382					$	58					4.2		%
Sales of services			490						499						(9)						(1.8)		%
Total Net sales			1,930						1,881						49						2.6		%
Cost of sales:
Cost of goods			(987)						(991)						(4)						(0.4)		%
Cost of services			(270)						(281)						(11)						(3.9)		%
Total Cost of sales			(1,257)						(1,272)						(15)						(1.2)		%
Cost of sales (% of Net sales)			65.0		%				67.6		%				(2.6)
Gross profit			673						609						64						10.5		%
Operating expenses			(283)						(284)						(1)						(0.4)		%
Income from operations			$	390					$	325					$	65					20.0		%
Income from operations (% of Net sales)			20.2		%				17.3		%				2.9

The following table shows the major components of the change in Net sales for the Freight Segment in the third quarter of 2024 from the third quarter of 2023:

In millions
Third Quarter 2023 Net sales			$	1,881
Acquisitions			2
Foreign Exchange			(11)
Organic changes in Net sales by Product Line:
Equipment			(100)
Services			135
Components			1
Digital Intelligence			22
Third Quarter 2024 Net sales			$	1,930

Net sales

Freight Segment organic sales increased by $58 million driven primarily by Services sales from higher deliveries of locomotive modernizations and engine overhauls and Digital Intelligence due to higher international sales, including PTC, on-board locomotive solutions, and digital mining products. Equipment sales decreased from lower locomotive deliveries, partially offset by increased mining sales.

Cost of sales

Freight Segment Cost of sales decreased $15 million, and Cost of sales as a percentage of Net sales decreased 2.6 percentage points. The improvement in gross margin is attributable to favorable mix within the Freight Segment product lines and strong productivity. Cost of sales for the three months ended September 30, 2023 was also impacted by manufacturing inefficiencies related to labor negotiations at our Erie facility. Cost of sales for each of the three months ended September 30, 2024 and 2023 included $2 million of restructuring costs, respectively, primarily related to Integration 2.0 in both years and Portfolio Optimization in 2024.

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Operating expenses

Freight Segment operating expenses decreased by $1 million primarily driven by lower professional services spend and a reduction in research and development costs, partially offset by higher SG&A expenses resulting from higher costs to support increased sales volume, higher employee compensation and benefit costs and incremental expense from acquisitions. Freight Segment operating expenses for the three months ended September 30, 2023 were also impacted by labor negotiations at our Erie facility. Freight SG&A expenses for the three months ended September 30, 2024 included $2 million of restructuring costs, primarily related to Portfolio Optimization. The amounts recorded in the three months ended September 30, 2023 were not significant.

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Transit Segment

The following table shows our Condensed Consolidated Statements of Operations for our Transit Segment for the periods indicated:

			Three Months Ended September 30,
In millions			2024						2023						Change						% Change
Net sales			$	733					$	669					$	64					9.6		%
Cost of sales			(526)						(486)						40						8.2		%
Cost of sales (% of Net sales)			71.8		%				72.8		%				(1.0)
Gross profit			207						183						24						13.1		%
Operating expenses			(128)						(113)						15						13.3		%
Income from operations			$	79					$	70					$	9					12.9		%
Income from operations (% of Net sales)			10.8		%				10.3		%				0.5

The following table shows the major components of the change in Net sales for the Transit Segment in the third quarter of 2024 from the third quarter of 2023:

In millions
Third Quarter 2023 Net sales			$	669
Foreign Exchange			8
Organic changes in Net sales by Product Line:
Aftermarket			16
Original Equipment Manufacturing			40
Third Quarter 2024 Net sales			$	733

Net sales

Transit Segment organic sales increased by $56 million driven by strong Original Equipment Manufacturing and Aftermarket sales primarily as a result of increased demand for products and services and increased investments in sustainable infrastructure. Changes in foreign exchange rates also increased sales by $8 million.

Cost of sales

Transit Segment Cost of sales increased by $40 million, primarily due to higher sales volume. Costs of sales as a percentage of sales decreased by 1.0 percentage points. The increase in gross margin was attributable to benefits from structured cost actions taken through Integration 2.0 and prior years' restructuring and integration projects, partially offset by unfavorable mix within the Transit Segment. Transit Cost of sales for the three months ended September 30, 2024 and 2023 included $5 million and $11 million of restructuring costs, respectively, primarily for footprint rationalization and headcount actions in Europe related to Integration 2.0.

Operating expenses

Transit Segment operating expenses increased by $15 million as compared to the prior year. Higher SG&A expenses to support higher sales volume and higher employee compensation and benefit costs were partially offset by benefits from structured cost actions taken through Integration 2.0 and prior years' restructuring and integration projects. Transit SG&A expenses for the three months ended September 30, 2024 included $3 million of restructuring costs, primarily for footprint rationalization and headcount actions in Europe related to Integration 2.0. The amounts recorded in the three months ended September 30, 2023 were not significant.

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FIRST NINE MONTHS OF 2024 COMPARED TO FIRST NINE MONTHS OF 2023

The following table shows our Condensed Consolidated Statements of Operations for the periods indicated.

			Nine Months Ended September 30,
In millions			2024						2023
Net sales:
Sales of goods			$	6,323					$	5,631
Sales of services			1,481						1,520
Total Net sales			7,804						7,151
Cost of sales:
Cost of goods			(4,413)						(4,132)
Cost of services			(822)						(839)
Total Cost of sales			(5,235)						(4,971)
Gross profit			2,569						2,180
Operating expenses:
Selling, general and administrative expenses			(915)						(843)
Engineering expenses			(155)						(157)
Amortization expense			(224)						(222)
Total Operating expenses			(1,294)						(1,222)
Income from operations			1,275						958
Other income and expenses:
Interest expense, net			(148)						(163)
Other (expense) income, net			(1)						17
Income before income taxes			1,126						812
Income tax expense			(272)						(204)
Net income			854						608
Less: Net income attributable to noncontrolling interest			(10)						(8)
Net income attributable to Wabtec shareholders			$	844					$	600

The following table shows the major components of the change in Net sales in the nine months ended September 30, 2024 from the nine months ended September 30, 2023:

In millions			Freight Segment						Transit Segment						Total
First Nine Months of 2023 Net sales			$	5,134					$	2,017					$	7,151
Acquisitions			72						—						72
Foreign Exchange			(18)						2						(16)
Organic			486						111						597
First Nine Months of 2024 Net sales			$	5,674					$	2,130					$	7,804

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Net sales

Net sales for the nine months ended September 30, 2024 increased by $653 million, or 9.1%, to $7.80 billion compared to the same period in 2023. Organic sales increased $597 million which was attributable to both the Freight and Transit Segments. Freight Equipment sales increased from higher North American and international locomotive sales and increased mining sales. Freight Services sales increased from higher deliveries of locomotive modernizations and engine overhauls and higher parts sales. Transit sales increased from higher demand for Original Equipment Manufacturing and Aftermarket products driven by increased investments in sustainable infrastructure. Sales from acquisitions contributed $72 million in the Freight Segment and unfavorable changes in foreign exchange rates decreased sales by $16 million.

Cost of sales

Cost of sales for the nine months ended September 30, 2024 increased by $264 million, or 5.3%, to $5.24 billion compared to the same period in 2023. The increase is primarily due to the increase in Net sales. Cost of sales as a percentage of Net sales was 67.1% and 69.5% for the nine months ended September 30, 2024 and 2023, respectively. The improvement in gross margin is attributable to improved pricing, favorable mix between the Freight and Transit segments, improved productivity and favorable fixed cost absorption. Cost of sales for the nine months ended September 30, 2024 and 2023 included $19 million and $25 million, respectively, of restructuring costs, primarily for headcount actions and footprint rationalization related to Integration 2.0 in both years and Portfolio Optimization in 2024.

Operating expenses

Total operating expenses increased $72 million, or 5.9%, for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to the increase in Net sales. Operating expenses as a percentage of sales was 16.6% and 17.1% for the nine months ended September 30, 2024 and 2023, respectively. SG&A expenses increased $72 million for the nine months ended September 30, 2024 compared to the same period in 2023. The increase is primarily from costs incurred to support the higher sales volume and higher employee compensation and benefit costs, partially offset by the impacts of Integration 2.0. Restructuring costs included in SG&A were $11 million and $7 million for the nine months ended September 30, 2024 and 2023, respectively, primarily for headcount actions and footprint rationalization programs related to Integration 2.0 in both years and Portfolio Optimization in 2024.

Interest expense, net

Interest expense, net, decreased $15 million to $148 million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to lower average debt balances in the current period, partially offset by higher effective interest rates.

Other (expense) income, net

Other (expense) income, net, decreased $18 million from $17 million to $(1) million for the nine months ended September 30, 2024 compared to the same period in 2023, primarily due to lower equity income.

Income taxes

The effective income tax rate was 24.1% and 25.1% for the nine months ended September 30, 2024 and 2023, respectively. The year over year decrease was primarily driven by higher discrete equity compensation tax deductions for the nine months ended September 30, 2024, audit closures, and a change in the jurisdictional mix of earnings.

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Freight Segment

The following table shows our Condensed Consolidated Statements of Operations for our Freight Segment for the periods indicated:

			Nine Months Ended September 30,
In millions			2024						2023						Change						% Change
Net sales:
Sales of goods			$	4,200					$	3,624					$	576					15.9		%
Sales of services			1,474						1,510						(36)						(2.4)		%
Total Net sales			5,674						5,134						540						10.5		%
Cost of sales:
Cost of goods			(2,889)						(2,678)						211						7.9		%
Cost of services			(818)						(831)						(13)						(1.6)		%
Total Cost of sales			(3,707)						(3,509)						198						5.6		%
Cost of sales (% of Net sales)			65.3		%				68.3		%				(3.0)
Gross profit			1,967						1,625						342						21.0		%
Operating expenses			(818)						(805)						13						1.6		%
Income from operations			$	1,149					$	820					$	329					40.1		%
Income from operations (% of Net sales)			20.2		%				16.0		%				4.2

The following table shows the major components of the change in Net sales for the Freight Segment in the first nine months of 2024 from the first nine months of 2023:

In millions
First Nine Months of 2023 Net sales			$	5,134
Acquisitions			72
Foreign Exchange			(18)
Organic changes in Net sales by Product Line:
Equipment			175
Services			279
Components			13
Digital Intelligence			19
First Nine Months of 2024 Net sales			$	5,674

Net sales

Freight Segment organic sales increased by $486 million driven primarily by Services sales from higher deliveries of locomotive modernizations and engine overhauls and higher parts sales, and Equipment sales from higher North American and international locomotive sales and increased mining sales. Additionally, Freight Segment sales also benefited from acquisitions by $72 million, primarily from our strategic acquisition of L&M Radiator, Inc.

Cost of sales

Freight Segment Cost of sales increased $198 million from higher sales volume, and Cost of sales as a percentage of Net sales decreased 3.0 percentage points. The improvement in gross margin is attributable to improved pricing, favorable mix within the Freight Segment product lines and improved productivity. Cost of sales for the nine months ended September 30, 2023 was also impacted by manufacturing inefficiencies related to labor negotiations at our Erie facility and costs related to next generation product development in Digital Intelligence. Cost of sales for the nine months ended September 30, 2024 and 2023 included $10 million and $8 million, respectively, of restructuring costs, primarily related to Integration 2.0 in both years and Portfolio Optimization in 2024.

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Operating expenses

Freight Segment operating expenses increased by $13 million primarily driven by higher SG&A expenses resulting from higher costs to support increased sales volume, higher employee compensation and benefit costs and incremental expense from acquisitions. Freight SG&A expenses for the nine months ended September 30, 2024 included $2 million of restructuring costs, primarily related to Portfolio Optimization. The amounts recorded in the nine months ended September 30, 2024 were not significant.

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Transit Segment

The following table shows our Condensed Consolidated Statements of Operations for our Transit Segment for the periods indicated:

			Nine Months Ended September 30,
In millions			2024						2023						Change						% Change
Net sales			$	2,130					$	2,017					$	113					5.6		%
Cost of sales			(1,528)						(1,462)						66						4.5		%
Cost of sales (% of Net sales)			71.8		%				72.5		%				(0.7)
Gross profit			602						555						47						8.5		%
Operating expenses			(367)						(347)						20						5.8		%
Income from operations			$	235					$	208					$	27					13.0		%
Income from operations (% of Net sales)			11.0		%				10.3		%				0.7

The following table shows the major components of the change in Net sales for the Transit Segment in the first nine months of 2024 from the first nine months of 2023:

In millions
First Nine Months of 2023 Net sales			$	2,017
Foreign Exchange			2
Organic changes in Net sales by Product Line:
Aftermarket			73
Original Equipment Manufacturing			38
First Nine Months of 2024 Net sales			$	2,130

Net sales

Transit Segment organic sales increased by $111 million driven by strong Original Equipment Manufacturing and Aftermarket sales primarily as a result of increased demand for products and services and increased investments in sustainable infrastructure.

Cost of sales

Transit Segment Cost of sales increased by $66 million primarily from higher sales volume, and Costs of sales as a percentage of sales decreased by 0.7 percentage points. The increase in gross margin is primarily attributable to favorable mix within the Transit Segment and the benefits from structured cost actions taken through Integration 2.0 and prior years' restructuring and integration projects. Transit Cost of sales for the nine months ended September 30, 2024 and 2023 included $9 million and $17 million of restructuring costs, respectively, primarily for footprint rationalization and headcount actions in Europe related to Integration 2.0.

Operating expenses

Transit Segment operating expenses increased by $20 million as compared to the prior year. Higher SG&A expenses to support higher sales volume and higher employee compensation and benefit costs were partially offset by benefits from structured cost actions taken through Integration 2.0 and prior years' restructuring and integration projects. Transit SG&A expenses for the nine months ended September 30, 2024 and 2023 included $9 million and $6 million of restructuring costs, respectively, primarily for footprint rationalization and headcount actions in Europe related to Integration 2.0.

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Liquidity and Capital Resources

Liquidity is provided by operating cash flows and borrowings under the 2022 Credit Agreement and the 2024 Credit Agreement, each with a consortium of commercial banks, and proceeds from the Company’s Senior Notes. Additionally, the Company utilizes the revolving receivables program and supply chain financing program described below, as well as other short-term financing agreements with certain banks, for added flexibility as part of our liquidity management strategy. The following is a summary of selected cash flow information and other relevant data:

			Nine Months Ended September 30,
In millions			2024						2023
Cash provided by (used for):
Operating activities			$	1,111					$	515
Investing activities			$	(106)					$	(336)
Financing activities			$	(1,209)					$	(323)

Operating activities In the first nine months of 2024, cash provided by operating activities was $1,111 million compared to $515 million in the first nine months of 2023. Significant changes to the sources and (uses) of cash for the nine month periods include the following:

•$246 million from increased Net income;

•$137 million from changes in Accounts payable due to timing of payments;

•$122 million from favorable changes in Accounts receivables driven by $202 million of higher collections on receivables, partially offset by $(80) million of higher remittance for the Revolving Receivables Program; and,

•$86 million from changes in Inventory primarily from the inventory build during the first nine months of 2023 due to a strike at the manufacturing facility in Erie, Pennsylvania, as well as supply chain disruptions.

Investing activities In the first nine months of 2024 and 2023, cash used for investing activities was $(106) million and $(336) million, respectively. During the first nine months of 2024, Wabtec used $(123) million for additions to property, plant and equipment for investments in our facilities and manufacturing processes, received $17 million of proceeds from dispositions of businesses, received $13 million of proceeds from disposals of property, plant and equipment, and used $(13) million for acquisitions. During the first nine months of 2023, Wabtec acquired L&M Radiator Inc., a leading manufacturer of heavy-duty equipment radiators and heat exchangers, for net cash of approximately $(229) million and used $(109) million for additions to property, plant, and equipment.

Financing activities In the first nine months of 2024, cash used for financing activities was $(1,209) million which included $(62) million from net changes in debt, $(974) million in stock repurchases, $(106) million of dividend payments, $(42) million of contingent consideration payments related to the GE Transportation acquisition, $(24) million of payments for income tax withholding on share-based compensation, and $(6) million for distributions to noncontrolling interest. In the first nine months of 2023, cash used for financing activities was $(323) million, which included $49 million from net changes in debt, $(252) million in stock repurchases, $(92) million of dividend payments, $(16) million of payments for income tax withholding on share-based compensation, and $(12) million for distributions to noncontrolling interest.

During the first quarter of 2024, the Company entered into the 2024 Credit Agreement for a term loan of $225 million. Also during the first quarter of 2024, the Company issued $500 million of Senior Notes due in 2034. Proceeds from the 2034 Notes, combined with the proceeds from the term loan under the 2024 Credit Agreement and cash on hand, were utilized to repay the outstanding amount of 2024 Notes at maturity.

As of September 30, 2024, the Company held approximately $410 million of cash, cash equivalents and restricted cash, of which approximately $9 million was held within the United States and approximately $401 million was held outside of the United States, primarily in India, Brazil, Europe and China. While repatriation of some cash held outside the United States may be restricted by local laws, most of the Company’s foreign cash could be repatriated to the United States net of any tax impacts. As of September 30, 2024, approximately $9 million of the Company's $410 million of cash balance was classified as restricted.

We or our affiliates may, from time to time, seek to retire or purchase outstanding debt through negotiated or open-market cash purchases, exchanges, or otherwise, and such transactions, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

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Revolving Receivables Program

The Company utilizes a revolving receivables facility to sell up to $350 million of certain receivables through our bankruptcy-remote subsidiary to a financial institution on a recurring basis in exchange for cash equal to the gross receivables sold. As customers pay their balances, we transfer additional receivables into the program, which could result in our gross receivables sold being higher or lower than customer collections remitted to the financial institution for any applicable periods. Net cash proceeds included in cash from operations from the revolving receivables program were $75 million and $155 million for the nine months ended September 30, 2024 and 2023, respectively. Additional information with respect to the Revolving Receivables Program is included in Note 2 of "Notes to Condensed Consolidated Financial Statements" included in Part I, Item 1 of this report.

Supply Chain Financing Program

The Company has entered into supply chain financing arrangements with third-party financial institutions to provide our vendors with enhanced payment options while providing the Company with added working capital flexibility. The Company does not provide any guarantees under these arrangements, does not have an economic interest in our suppliers' voluntary participation, does not receive an economic benefit from the financial institutions, and no assets are pledged under the arrangements. The arrangements do not change the payable terms negotiated by the Company and our vendors and does not result in a change in the classification of amounts due as Accounts payable in the Condensed Consolidated Balance Sheets. Additional information with respect to the Supply Chain Financing Program is included in Note 2 of "Notes to Condensed Consolidated Financial Statements" included in Part I, Item 1 of this report.

Intra-Quarter Uncommitted Money Market Line Credit Agreement

During the third quarter of 2024, the Company entered into an uncommitted bilateral money market line credit agreement which provides an aggregate borrowing capacity of $150 million, for general business purposes and working capital needs within a quarter.

Guarantor Summarized Financial Information

The obligations under the US Notes issued by Westinghouse Air Brake Technologies Corporation (the "Parent Company") have been fully and unconditionally guaranteed by certain of the Parent Company's U.S. subsidiaries ("Guarantor Subsidiaries"). Each guarantor is 100% owned by the Parent Company, with the exception of GE Transportation, a Wabtec Company, which has 15,000 shares outstanding of Class A Non-Voting Preferred Stock held by General Electric Company. The Euro Notes are issued by Wabtec Transportation Netherlands B.V. ("Wabtec Netherlands") and are fully and unconditionally guaranteed by the Parent Company.

The following tables present summarized financial information of the Parent Company and the guarantor subsidiaries on a combined basis. The combined summarized financial information eliminates intercompany balances and transactions among the Parent Company and guarantor subsidiaries and equity in earnings and investments in any guarantor subsidiaries or non-guarantor subsidiaries. The summarized financial information is provided in accordance with the reporting requirements of Rule 13-01 under SEC Regulation S-X for the issuer and guarantor subsidiaries.

Summarized Statement of Income

						Unaudited
						Parent Company and Guarantor Subsidiaries
In millions						Nine Months Ended September 30, 2024
Net sales						$	4,567
Gross profit						$	1,632
Net income attributable to Wabtec shareholders						$	768

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Summarized Balance Sheet

						Unaudited
						Parent Company and Guarantor Subsidiaries
In millions						September 30, 2024						December 31, 2023
Current assets						$	1,225					$	1,513
Noncurrent assets						$	2,018					$	2,196
Current liabilities						$	2,169					$	2,443
Long-term debt						$	2,961					$	2,739
Other non-current liabilities						$	517					$	662

The following is a description of the transactions between the combined Parent Company and guarantor subsidiaries with non-guarantor subsidiaries.

						Unaudited
						Parent Company and Guarantor Subsidiaries
In millions						Nine Months Ended September 30, 2024
Net sales to non-guarantor subsidiaries						$	665
Purchases from non-guarantor subsidiaries						$	857
						Unaudited
						Parent Company and Guarantor Subsidiaries
In millions						September 30, 2024
Amount due to non-guarantor subsidiaries						$	11,786

Summarized Financial Information—Euro Notes

The obligations under Wabtec Netherlands’ Euro Notes are fully and unconditionally guaranteed by the Parent Company. Wabtec Netherlands is a wholly owned, indirect subsidiary of the Parent Company. Wabtec Netherlands is a holding company and does not have any independent operations. Its assets consist of its investments in subsidiaries, which are separate and distinct legal entities that are not guarantors of the Euro Notes and have no obligations to pay amounts due under Wabtec Netherlands’ obligations.

The following tables present summarized financial information of Wabtec Netherlands, as the Issuer of the Euro Notes, and the Parent Company, as the parent Guarantor, on a combined basis. The combined summarized financial information eliminates all intercompany balances and transactions among Wabtec Netherlands and the Parent Company as well as all equity in earnings from and investments in any subsidiary of the Parent Company, other than Wabtec Netherlands, which we refer to below as the Non-Guarantor Subsidiaries. The summarized financial information is provided in accordance with the reporting requirements of Rule 13-01 under SEC Regulation S-X for the issuer and Parent Company guarantor.

Summarized Statement of Income

						Unaudited
						Issuer and Guarantor
In millions						Nine Months Ended September 30, 2024
Net sales						$	418
Gross profit						$	76
Net loss attributable to Wabtec shareholders						$	(418)

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Summarized Balance Sheet

						Unaudited
						Issuer and Guarantor
In millions						September 30, 2024						December 31, 2023
Current assets						$	170					$	493
Noncurrent assets						$	645					$	651
Current liabilities						$	1,010					$	1,272
Long-term debt						$	3,516					$	3,287
Other non-current liabilities						$	55					$	84

The following is a description of the transactions between the combined Wabtec Netherlands, as the Issuer of the Euro Notes, and the Parent Company, as the parent Guarantor, with the subsidiaries of Westinghouse Air Brake Technologies Corp., other than Wabtec Netherlands, none of which are guarantors of the Euro Notes.

						Unaudited
						Issuer and Guarantor
In millions						Nine Months Ended September 30, 2024
Net sales to non-guarantor subsidiaries						$	36
Purchases from non-guarantor subsidiaries						$	106
						Unaudited
						Issuer and Guarantor
In millions						September 30, 2024
Amount due to non-guarantor subsidiaries						$	8,081

Company Stock Repurchase Plan

On February 9, 2024, the Board of Directors reauthorized its stock repurchase program to refresh the amount available for stock repurchases to $1 billion of the Company’s outstanding shares. This new stock repurchase authorization supersedes the previous authorization of $750 million, of which approximately $333 million remained at the reauthorization date. No time limit was set for the completion of the program which conforms to the requirements under the 2022 Credit Agreement and the 2024 Credit Agreement and the indentures for the Senior Notes currently outstanding. The Company may repurchase shares in the future at any time, depending upon market conditions, our capital needs and other factors. Purchases of shares may be made by open market purchases or privately negotiated purchases and may be made pursuant to Rule 10b5-1 plan or otherwise. As of September 30, 2024, approximately $123 million was remaining under the stock repurchase plan.

Forward Looking Statements

We believe that all statements other than statements of historical facts included in this report, including certain statements under “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” may constitute forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. Although we believe that our assumptions made in connection with the forward-looking statements are reasonable, we cannot assure that our assumptions and expectations are correct.

These forward-looking statements are subject to various risks, uncertainties and assumptions about us, including, among other things:

Economic and industry conditions

•changes in general economic and/or industry specific conditions, including the impacts of tax and tariff programs, inflation, supply chain disruptions, foreign currency exchange, and industry consolidation;

•prolonged unfavorable economic and industry conditions in the markets served by us, including North America, South America, Europe, Australia, Asia and Africa;

•decline in demand for freight cars, locomotives, passenger transit cars, buses and related products and services;

•reliance on major original equipment manufacturer customers;

•original equipment manufacturers’ program delays;

•demand for services in the freight and passenger rail industry;

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•demand for our products and services;

•orders either being delayed, canceled, not returning to historical levels or being reduced, and/or economic conditions affecting the ability of our customers to pay timely for goods and services delivered;

•consolidations in the rail industry;

•continued outsourcing by our customers;

•industry demand for faster and more efficient braking equipment;

•fluctuations in interest rates and foreign currency exchange rates;

•availability of credit or difficulty in obtaining debt or equity financing;

•changes in market consensus as to what attributes are required for projects to be considered "green" or "sustainable" or negative perceptions regarding determinations in such regard with respect to our Green Finance Framework or ESG strategy; or

•changes in the ESG topics that have the highest relative priority for Wabtec's external stakeholders;

Operating factors

•supply disruptions;

•technical difficulties;

•changes in operating conditions and costs;

•increases in raw material costs;

•successful introduction of new products;

•performance under material long-term contracts;

•labor availability and relations;

•the outcome of our existing or any future legal proceedings, including litigation involving our principal customers and any litigation with respect to environmental matters, asbestos-related matters, pension liabilities, warranties, product liabilities, competition and anti-trust matters or intellectual property claims;

•completion and integration of acquisitions;

•the development and use of new technology; or

•cybersecurity and data protection risks;

Competitive factors

•the actions of competitors; or

•the outcome of negotiations with partners, suppliers, customers or others;

Political/governmental factors

•political stability in relevant areas of the world, including the impacts of war, conflicts, global military action, and acts of terrorism;

•future regulation/deregulation of our customers and/or the rail industry;

•levels of governmental funding on transit projects, including for some of our customers;

•political developments and laws and regulations, including those related to Positive Train Control;

•federal and state income tax legislation;

•sanctions imposed on countries and persons; or

•the outcome of negotiations with governments;

Natural hazards / health crises

•impacts of climate change, including evolving climate change policy;

•disruptive natural hazards, including earthquakes, fires, floods, tornadoes, hurricanes or other weather conditions;

•epidemics, pandemics, or similar public health crises;

•deterioration of general economic conditions as a result of natural hazards or health crises;

•shutdown of one or more of our operating facilities as a result of natural hazards and health crises; or

•supply chain and sourcing disruptions as a result of natural hazards, health crises or other external factors;

Statements in this Quarterly Report on Form 10-Q apply only as of the date on which such statements are made, and except as required by law, we undertake no obligation to update any statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. Reference is also made to the risk factors set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Critical Accounting Estimates

A summary of critical accounting estimates is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. In particular, judgment is used in areas such as accounts receivable and the allowance for doubtful accounts, inventories, business combinations, goodwill and indefinite-lived intangible assets, warranty reserves, income taxes, and revenue recognition. There have been no significant changes in the related accounting policies since December 31, 2023.

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Contractual Obligations

During the first quarter of 2024, the Company entered into the 2024 Credit Agreement for a term loan of $225 million which is scheduled to mature on March 14, 2029. Also during the first quarter of 2024, the Company issued $500 million of Senior Notes due in 2034. Proceeds from the 2034 Notes, combined with the proceeds from the term loan under the 2024 Credit Agreement and cash on hand, were utilized to repay the outstanding amount of 2024 Notes at maturity. As a result of these transactions, contractual obligations related the repayment of Long-term debt for 2029 and beyond has increased to $725 million.

During the third quarter of 2024, the Company entered into an uncommitted bilateral money market line credit agreement which provides an aggregate borrowing capacity of $150 million, for general business purposes and working capital needs within a quarter.

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Item 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

See "Quantitative and Qualitative Disclosures About Market Risk" in Item 7A of Part II of our Annual Report on Form 10-K for the year ended December 31, 2023. Our exposure to market risk has not changed materially since December 31, 2023. Refer to Note 13 - Fair Value Measurement and Derivative Instruments of "Notes to Condensed Consolidated Financial Statements" included in Part I, Item 1 of this report for additional information regarding interest rate and foreign currency exchange risk.

Item 4.    CONTROLS AND PROCEDURES

Wabtec’s principal executive officer and its principal financial officer have evaluated the effectiveness of Wabtec’s “disclosure controls and procedures,” (as defined in Exchange Act Rule 13a-15(e)) as of September 30, 2024. Based upon their evaluation, the principal executive officer and principal financial officer concluded that Wabtec’s disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by Wabtec in the reports filed or submitted by it under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and to provide reasonable assurance that information required to be disclosed by Wabtec in such reports is accumulated and communicated to Wabtec’s Management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

There was no change in Wabtec’s “internal control over financial reporting” (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended September 30, 2024, that has materially affected, or is reasonably likely to materially affect, Wabtec’s internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1.    LEGAL PROCEEDINGS

Additional information with respect to legal proceedings is included in Note 14 of “Notes to Condensed Consolidated Financial Statements” included in Part I, Item 1 of this report.

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, 2023.

Item 2.    UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table summarizes the Company's stock repurchase activity for the three months ended September 30, 2024:

Issuer Purchases of Common Stock
In millions, except shares and price per share						Total Number of Shares Purchased						Average Price Paid per Share						Total Number of Shares Purchased as Part of Publicly Announced Programs (1)						Maximum Dollar Value of Shares That May Yet Be Purchased Under the Programs (1)
July 2024						555,587						$	161.88					555,587						$	633
August 2024						1,501,329						$	156.30					1,501,329						$	398
September 2024						1,627,298						$	168.99					1,627,298						$	123
Total quarter ended September 30, 2024						3,684,214						$	162.75					3,684,214						$	123

(1)     On February 9, 2024, the Board of Directors reauthorized its stock repurchase program to refresh the amount available for stock repurchases to $1 billion of the Company’s outstanding shares. This new stock repurchase authorization supersedes the previous authorization of $750 million, of which approximately $333 million remained at the reauthorization date. No time limit was set for the completion of the program which conforms to the requirements under the 2022 Credit Agreement, the 2024 Credit Agreement and the indentures for the Senior Notes currently outstanding. The Company may repurchase shares in the future at any time, depending upon market conditions, our capital needs and other factors. Purchases of shares may be made by open market purchases or privately negotiated purchases and may be made pursuant to Rule 10b5-1 plan or otherwise. As of September 30, 2024, approximately $123 million was remaining under the stock repurchase plan.

Item 4.    MINE SAFETY DISCLOSURES

Not Applicable

Item 5.    OTHER INFORMATION

None of Wabtec's Directors or Officers have adopted, terminated, or materially modified any trading plans, whether or not the plan was intended to qualify for the affirmative defense under Rule 10b5-1, during the third quarter ended September 30, 2024.

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Item 6.    EXHIBITS

The following exhibits are being filed with this report:

22.1			List of Subsidiary Guarantors
31.1			Rule 13a-14(a) Certification of Chief Executive Officer.
31.2			Rule 13a-14(a) Certification of Chief Financial Officer.
32.1			Section 1350 Certification of Chief Executive Officer and Chief Financial Officer.
101.INS			XBRL Instance Document.
101.SCH			Inline XBRL Taxonomy Extension Schema Document.
101.CAL			Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF			Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB			Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE			Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104			Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION
By:			/s/ JOHN A. OLIN
			John A. Olin
			Executive Vice President and Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)
DATE:			October 23, 2024

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