L.B. Foster Company Reports Modest Sales Increase but Significant Profit Decline in Q3 2025

L.B. Foster Company reported its financial results for the third quarter and the first nine months of 2025, revealing a modest increase in net sales but a significant decline in profitability compared to the previous fiscal period. For the three months ended September 30, 2025, the company recorded total net sales of $138.3 million, a slight increase of $820, or 0.6%, from $137.5 million in the same period last year. However, net income attributable to L.B. Foster Company fell sharply to $4.4 million, or $0.40 per diluted share, down from $35.9 million, or $3.27 per diluted share, in the prior year, primarily due to a favorable tax valuation adjustment recorded in the previous quarter.

In the nine-month period ending September 30, 2025, total net sales decreased by $22.9 million, or 5.7%, to $379.6 million, compared to $402.6 million in the same period of 2024. The decline was driven by a 16.1% drop in sales from the Rail segment, which was partially offset by an 11.0% increase in the Infrastructure segment. Gross profit for the nine months also decreased by $7.3 million, or 8.2%, leading to a gross profit margin of 21.6%, down from 22.2% in the prior year.

Strategically, L.B. Foster has made significant changes, including the discontinuation of its Automation and Materials Handling product line and the Bridge Products grid deck product line, both of which are expected to complete remaining customer obligations by the end of 2025. The company incurred exit costs of $1.4 million related to these product line exits. Additionally, the company has been focusing on restructuring efforts to reduce costs, which contributed to a decrease in selling and administrative expenses by 9.1% in the third quarter.

Operationally, the company reported a backlog of $247.4 million as of September 30, 2025, an increase from $209.0 million a year earlier, driven primarily by improvements in the Rail segment. New orders for the Rail segment increased significantly, reflecting a 68.2% improvement in the Technology Services and Solutions business unit. However, the Infrastructure segment experienced a decrease in new orders due to cancellations in the Steel Products business unit.

Looking ahead, L.B. Foster remains cautious about market conditions, including potential impacts from economic fluctuations and ongoing restructuring efforts. The company is focused on managing its working capital and maintaining compliance with its credit agreements, which provide a total borrowing capacity of $150 million. As of September 30, 2025, the company had $3.4 million in cash and cash equivalents and $91.1 million available under its revolving credit facility, indicating a stable liquidity position despite the challenges faced in the current fiscal year.