WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORP Form 10-Q Quarterly Report Filed 2012-11-02

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2012

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 1-13782

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

(Exact name of registrant as specified in its charter)


Delaware		25-1615902
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1001 Air Brake Avenue Wilmerding, PA		15148
(Address of principal executive offices)		(Zip Code)

412-825-1000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class		Outstanding at October 26, 2012
Common Stock, $.01 par value per share		47,887,404 shares

WESTINGHOUSE AIR BRAKE

TECHNOLOGIES CORPORATION

September 30, 2012

FORM 10-Q

TABLE OF CONTENTS


		Page
	PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets as of September 30, 2012 and December 31, 2011		3
	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2012 and 2011		4
	Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2012 and 2011		5
	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2012 and 2011		6
	Notes to Condensed Consolidated Financial Statements		7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		27
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		38
Item 4.	Controls and Procedures		38

	PART II—OTHER INFORMATION

Item 1.	Legal Proceedings		39
Item 1A.	Risk Factors		39
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		39
Item 4.	Mine Safety Disclosures		39
Item 6.	Exhibits		40
	Signatures		41

PART I—FINANCIAL INFORMATION

Item 1.

FINANCIAL STATEMENTS

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS


*In thousands, except shares and par value*	Unaudited September 30, 2012			December 31, 2011
Assets
Current Assets
Cash and cash equivalents	$	282,055		$	285,615
Accounts receivable		430,230			346,281
Inventories		391,592			348,174
Deferred income taxes		58,592			57,339
Other		21,580			18,373

Total current assets		1,184,049			1,055,782
Property, plant and equipment		534,687			513,113
Accumulated depreciation		(305,540	)		(291,091	)

Property, plant and equipment, net		229,147			222,022
Other Assets
Goodwill		656,933			587,531
Other intangibles, net		284,889			257,355
Other noncurrent assets		41,024			36,263

Total other assets		982,846			881,149

Total Assets	$	2,396,042		$	2,158,953

Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable	$	235,568		$	244,649
Customer deposits		104,404			72,811
Accrued compensation		49,443			48,564
Accrued warranty		38,555			29,416
Current portion of long-term debt		43			68
Other accrued liabilities		112,679			145,877

Total current liabilities		540,692			541,385
Long-term debt		432,854			395,805
Accrued postretirement and pension benefits		59,855			63,837
Deferred income taxes		91,281			74,217
Accrued warranty		18,942			21,224
Other long-term liabilities		21,401			14,841

Total liabilities		1,165,025			1,111,309
Shareholders’ Equity
Preferred stock, 1,000,000 shares authorized, no shares issued		—			—
Common stock, $.01 par value; 100,000,000 shares authorized: 66,174,767 shares issued and 47,887,204 and 47,946,360 outstanding at September 30, 2012 and December 31, 2011, respectively		662			662
Additional paid-in capital		375,975			360,914
Treasury stock, at cost, 18,287,563 and 18,228,407 shares, at September 30, 2012 and December 31, 2011, respectively		(331,708	)		(309,196	)
Retained earnings		1,235,417			1,053,706
Accumulated other comprehensive loss		(55,080	)		(60,897	)

Total Westinghouse Air Brake Technologies Corporation shareholders’ equity		1,225,266			1,045,189
Non-controlling interest		5,751			2,455

Total shareholders’ equity		1,231,017			1,047,644

Total Liabilities and Shareholders’ Equity	$	2,396,042		$	2,158,953

The accompanying notes are an integral part of these statements.

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


	Unaudited Three Months Ended September 30,						Unaudited Nine Months Ended September 30,
*In thousands, except per share data*	2012			2011			2012			2011
Net sales	$	587,593		$	498,840		$	1,780,722		$	1,432,998
Cost of sales		(416,314	)		(351,689	)		(1,266,635	)		(1,009,908	)

Gross profit		171,279			147,151			514,087			423,090
Selling, general and administrative expense		(59,743	)		(57,676	)		(180,935	)		(186,435	)
Engineering expense		(10,753	)		(9,894	)		(31,047	)		(27,914	)
Amortization expense		(3,941	)		(4,128	)		(10,288	)		(10,549	)

Total operating expenses		(74,437	)		(71,698	)		(222,270	)		(224,898	)
Income from operations		96,842			75,453			291,817			198,192
Other income and expenses
Interest expense, net		(3,070	)		(3,764	)		(10,303	)		(11,241	)
Other (expense) income, net		(1,393	)		(1,529	)		(1,284	)		(1,479	)

Income from operations before income taxes		92,379			70,160			280,230			185,472
Income tax expense		(29,385	)		(23,560	)		(93,263	)		(61,586	)

Net income attributable to Wabtec shareholders	$	62,994		$	46,600		$	186,967		$	123,886

Earnings Per Common Share
Basic
Net income attributable to Wabtec shareholders	$	1.32		$	0.97		$	3.90		$	2.58

Diluted
Net income attributable to Wabtec shareholders	$	1.30		$	0.96		$	3.85		$	2.56

Weighted average shares outstanding
Basic		47,643			47,874			47,732			47,827
Diluted		48,271			48,366			48,360			48,327

The accompanying notes are an integral part of these statements.

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


	Unaudited Three Months Ended September 30,						Unaudited Nine Months Ended September 30,
*In thousands*	2012			2011			2012			2011
Net income attributable to Wabtec shareholders	$	62,994		$	46,600		$	186,967		$	123,886
Foreign currency translation gain (loss)		11,916			(37,792	)		6,298			(10,696	)
Unrealized gain on foreign exchange contracts		—			200			—			251
Unrealized (loss) gain on interest rate swap contracts		(903	)		376			(3,064	)		604
Pension benefit plans and post-retirement benefit plans		(128	)		2,571			2,158			3,273

Comprehensive income before income taxes		73,879			11,955			192,359			117,318
Income tax benefit (expense) related to components of other comprehensive income		333			(959	)		425			(1,351	)

Comprehensive income attributable to Wabtec shareholders	$	74,212		$	10,996		$	192,784		$	115,967

The accompanying notes are an integral part of these statements.

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Unaudited Nine Months Ended September 30,
*In thousands*	2012			2011
Operating Activities
Net income attributable to Wabtec shareholders	$	186,967		$	123,886
Adjustments to reconcile net income to net cash provided by operations:
Depreciation and amortization		31,488			33,678
Stock-based compensation expense		15,007			13,222
Loss on disposal of property, plant and equipment		674			689
Excess income tax benefits from exercise of stock options		(2,518	)		(3,689	)
Changes in operating assets and liabilities, net of acquisitions
Accounts receivable		(71,430	)		(80,285	)
Inventories		(26,599	)		(63,389	)
Accounts payable		(18,569	)		3,696
Accrued income taxes		(17,378	)		4,257
Accrued liabilities and customer deposits		37,700			80,848
Other assets and liabilities		(21,817	)		(12,893	)

Net cash provided by operating activities		113,525			100,020
Investing Activities
Purchase of property, plant and equipment		(24,694	)		(22,226	)
Proceeds from disposal of property, plant and equipment		931			300
Acquisitions of business, net of cash acquired		(102,144	)		(51,777	)
Acquisition purchase price adjustment		(160	)		40

Net cash used for investing activities		(126,067	)		(73,663	)
Financing Activities
Proceeds from debt		211,000			124,000
Payments of debt		(173,992	)		(139,920	)
Proceeds from exercise of stock options and other benefit plans		3,021			4,577
Stock repurchase		(27,997	)		(23,803	)
Excess income tax benefits from exercise of stock options		2,518			3,689
Cash dividends ($0.11 and $0.05 per share for the nine months ended September 30, 2012 and 2011, respectively)		(5,256	)		(2,407	)

Net cash provided by (used for) financing activities		9,294			(33,864	)
Effect of changes in currency exchange rates		(312	)		(8,298	)

Decrease in cash		(3,560	)		(15,805	)
Cash, beginning of year		285,615			236,941

Cash, end of period	$	282,055		$	221,136

The accompanying notes are an integral part of these statements.

WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2012 (UNAUDITED)

1. BUSINESS

Wabtec is one of the world’s largest providers of value-added, technology-based products and services for the global rail industry. Our products are found on virtually all U.S. locomotives, freight cars and passenger transit vehicles, as well as in more than 100 countries throughout the world. Our products enhance safety, improve productivity and reduce maintenance costs for customers, and many of 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 20 countries. In the first nine months of 2012, about 50% of the Company’s revenues came from customers outside the U.S.

2. ACCOUNTING POLICIES

Basis of Presentation The unaudited condensed consolidated interim financial statements have been prepared in accordance with generally accepted accounting principles and the rules and regulations of the Securities and Exchange Commission and include the accounts of Wabtec and its majority owned subsidiaries. These condensed consolidated interim financial statements do not include all of the information and footnotes required for complete financial statements. In Management’s opinion, these financial statements reflect all adjustments of a normal, recurring nature necessary for a fair presentation of the results for the interim periods presented. Results for these interim periods are not necessarily indicative of results to be expected for the full year.

The Company operates on a four-four-five week accounting quarter, and the quarters end on or about March 31, June 30, September 30 and December 31.

The notes included herein should be read in conjunction with the audited consolidated financial statements included in Wabtec’s Annual Report on Form 10-K for the year ended December 31, 2011. The December 31, 2011 information has been derived from the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

Reclassifications Certain prior year amounts have been reclassified where necessary to conform to the current year presentation.

Revenue Recognition Revenue is recognized in accordance with Accounting Standards Codification (“ASC”) 605 “Revenue Recognition”. Revenue is recognized when products have been shipped to the respective customers, title has passed and the price for the product has been determined.

In general, the Company recognizes revenues on long-term contracts based on the percentage of completion method of accounting. The units-of-delivery method or other input-based or output-based measures, as appropriate, are used to measure the progress toward completion of individual contracts. Contract revenues and cost estimates are reviewed and revised at a minimum quarterly and adjustments are reflected in the accounting period as such amounts are determined. Provisions are made currently for estimated losses on uncompleted contracts. Unbilled accounts receivables were $92.5 million and $58.9, customer deposits were $104.4 million and $72.8, and provisions for loss contracts were $9.9 million and $9.3 million at September 30, 2012 and December 31, 2011, respectively.

Certain pre-production costs relating to long-term production and supply contracts have been deferred and will be recognized over the life of the contracts. Deferred pre-production costs were $16.4 million and $15.4 million at September 30, 2012 and December 31, 2011, respectively.

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the Company to make estimates and assumptions that affect the reported

amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates. On an ongoing basis, management reviews its estimates based on currently available information. Changes in facts and circumstances may result in revised estimates.

Stock-Based Compensation The Company recognizes compensation expense for stock-based compensation based on the grant date fair value amortized ratably over the requisite service period following the date of grant.

Financial Derivatives and Hedging Activities The Company has periodically entered into foreign currency forward contracts to reduce the impact of changes in currency exchange rates. Forward contracts are agreements with a counter-party to exchange two distinct currencies at a set exchange rate for delivery on a set date at some point in the future. There is no exchange of funds until the delivery date. At the delivery date the Company can either take delivery of the currency or settle on a net basis. At September 30, 2012, the Company had no forward contracts.

To reduce the impact of interest rate changes on a portion of its variable-rate debt, the Company entered into interest rate swaps which effectively converted a portion of the debt from variable to fixed-rate borrowings during the term of the swap contracts. The Company is exposed to credit risk in the event of nonperformance by the counterparties. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparties are large financial institutions with excellent credit ratings and history of performance. The Company currently believes the risk of nonperformance is negligible. The Company concluded that these interest rate swap agreements qualify for cash flow hedge accounting which permits the recording of the fair value of the interest rate swap agreements and corresponding adjustment to other comprehensive income (loss), net of tax, on the balance sheet.

Effective September 30, 2012, the Company had interest rate swap agreements with a notional amount of $107.0 million and which effectively changed the Company’s interest rate on bank debt at September 30, 2012 from a variable rate to a fixed rate of 1.82%. The interest rate swap agreements mature on December 31, 2012. As of September 30, 2012, the Company has recorded a current liability of $0.4 million and a corresponding offset in accumulated other comprehensive loss of $0.3 million, net of tax, related to these agreements. Also, the Company entered into a forward starting interest rate swap agreement with a notional value of $150.0 million. Effective July 31, 2013, with a termination date of November 7, 2016, this interest rate swap agreement will convert a portion of the Company’s then outstanding debt from a variable rate to a fixed-rate borrowing. During the term of the interest rate swap agreement the interest rate on the notional value will be fixed at 1.415% plus the Alternate Rate margin. As of September 30, 2012, the Company has recorded a current liability of $4.1 million and a corresponding offset in accumulated other comprehensive loss of $2.5 million, net of tax, related to this agreement.

Foreign Currency Translation Assets and liabilities of foreign subsidiaries, except for the Company’s Mexican operations whose functional currency is the U.S. Dollar, are translated at the rate of exchange in effect on the balance sheet date while income and expenses are translated at the average rates of exchange prevailing during the year. Foreign currency gains and losses resulting from transactions, and the translation of financial statements are recorded in the Company’s consolidated financial statements based upon the provisions of ASC 830 “Foreign Currency Matters.” The effects of currency exchange rate changes on intercompany transactions and balances of a long-term investment nature are accumulated and carried as a component of accumulated other comprehensive loss. The effects of currency exchange rate changes on intercompany transactions that are denominated in a currency other than an entity’s functional currency are charged or credited to earnings. Foreign exchange transaction losses recognized in other income (expense), net were $1.4 million and $1.8 million for the three months ended September 30, 2012 and 2011, respectively. Foreign exchange transaction losses recognized in other income (expense), net were $0.4 million and $2.1 million for the nine months ended September 30, 2012 and 2011, respectively.

Non-controlling Interests In accordance with ASC 810, the Company has classified non-controlling interests as equity on our condensed consolidated balance sheets as of September 30, 2012 and December 31, 2011. Net income attributable to non-controlling interests for the three and nine months ended September 30, 2012 and 2011 was not material.

Other Comprehensive Income Comprehensive income is defined as net income and all other non-owner changes in shareholders’ equity.

The components of accumulated other comprehensive loss were:


*In thousands*	September 30, 2012			December 31, 2011
Foreign currency translation gain (loss)	$	3,851		$	(2,447	)
Unrealized loss on interest rate swap contracts, net of tax		(2,722	)		(871	)
Pension benefit plans and post retirement benefit plans, net of tax		(56,209	)		(57,579	)

Total accumulated comprehensive loss	$	(55,080	)	$	(60,897	)

3. ACQUISITIONS

The Company made the following acquisitions within the Transit Segment:

•

On October 1, 2012, subsequent to the close of our accounting quarter, the Company acquired LH Group (“LH”), a UK-based provider of maintenance and overhaul services for the passenger transit market, for a net purchase price of approximately $47.8 million, net of cash.

•

On July 13, 2012, the Company acquired Tec Tran Corp. and its affiliates (“Tec Tran”), the only U.S.-owned manufacturer of hydraulic braking systems for transit cars, based in North Carolina, for a net purchase price of approximately $8.5 million, net of cash, resulting in preliminary additional goodwill of $6.8 million, which will be deductible for tax purposes.

•

On June 14, 2012, the Company acquired Mors Smitt Holding (“Mors Smitt”), a leading manufacturer of electronic components for rail and industrial markets with operations in the Netherlands, the United Kingdom, the U.S., France, China and Hong-Kong, for a net purchase price of approximately $90.0 million, net of cash, resulting in preliminary additional goodwill of $50.0 million, none of which will be deductible for tax purposes.

•

On November 18, 2011, the Company acquired Fulmer Company (“Fulmer”), a leading manufacturer of motor components for rail, power generation and other industrial markets, for a net purchase price of $13.6 million, resulting in preliminary additional goodwill of $2.0 million, which will be deductible for tax purposes.

•

On June 29, 2011, the Company acquired an aftermarket transit parts business (“ATP”) from GE Transportation, a parts supply business for propulsion and control systems for the passenger transit car aftermarket in North America for a net purchase price of $21.1 million, resulting in no additional goodwill.

•

On February 25, 2011, the Company acquired Brush Traction Group (“Brush Traction”), a UK-based provider of locomotive overhauls, services and aftermarket components for a net purchase price of approximately $30.7 million, resulting in additional goodwill of $20.5 million, which will be deductible for tax purposes.

The Company made the following acquisitions within the Freight Segment:

•

On July 31, 2012, the Company acquired Winco Equipamentos Ferroviarios Ltda. (“Winco”), an established marketing and sales company with capabilities including value-added engineering and

assembly, service, technical support and logistics, based in Brazil, for an initial net payment of approximately $3.7 million, net of cash, resulting in preliminary additional goodwill of $4.8 million, none of which will be deductible for tax purposes. In addition to the $3.7 million, the purchase agreement includes contingent consideration to be paid in future periods based on the achievement of certain financial results.

•

On November 3, 2011, the Company acquired Bearward Engineering (“Bearward”), a UK-based manufacturer of cooling systems and related equipment for power generation and other industrial markets, for a net purchase price of approximately $43.8 million, net of cash, resulting in preliminary additional goodwill of $24.2 million, none of which will be deductible for tax purposes.

The acquisitions listed above, excluding LH, include escrow deposits of $15.3 million, which act as security for indemnity and other claims in accordance with the purchase and related escrow agreements.

For the Bearward, Fulmer, Mors Smitt, Tec Tran and Winco acquisitions, the following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition. For the Brush Traction and ATP acquisitions, the following table summarizes the final fair value of the assets acquired and liabilities assumed at the date of acquisition.


	Brush Traction			ATP		Bearward			Fulmer			Mors Smitt			Tec Tran			Winco
*In thousands*	February 25, 2011			June 29, 2011		November 3, 2011			November 18, 2011			June 14, 2012			July 13, 2012			July 31, 2012
Current assets	$	19,558		$	—	$	14,777		$	4,203		$	23,787		$	1,955		$	1,584
Property, plant & equipment		8,862			—		4,498			1,636			6,960			116			47
Goodwill and other intangible assets		30,816			21,100		43,990			8,409			85,354			6,811			7,401
Other assets		—			—		53			—			944			—			—

Total assets acquired		59,236			21,100		63,318			14,248			117,045			8,882			9,032
Total liabilities assumed		(28,559	)		—		(19,532	)		(657	)		(27,057	)		(382	)		(5,376	)

Net assets acquired	$	30,677		$	21,100	$	43,786		$	13,591		$	89,988		$	8,500		$	3,656

Of the allocation of $94.8 million of acquired intangible assets for the companies listed in the above table exclusive of goodwill, $63.1 million was assigned to customer relationships, $23.0 million was assigned to trade names, $2.1 million was assigned to a license agreement, $1.0 million was assigned to non-compete agreements and $5.6 million was assigned to customer backlog. The trade names are considered to have an indefinite useful life while the customer relationships’ average useful life is 19 years, the license agreement’s useful life is 20 years, and the non-compete agreements average useful life is two years.

The following unaudited pro forma financial information presents income statement results as if the acquisitions listed above, excluding LH, had occurred on January 1, 2011:


*In thousands*	Three Months Ended September 30, 2012		Three Months Ended September 30, 2011		Nine Months Ended September 30, 2012		Nine Months Ended September 30, 2011
Net sales	$	588,939	$	546,413	$	1,820,046	$	1,574,359
Gross profit		171,818		163,340		529,695		469,767
Net income attributable to Wabtec shareholders		63,263		53,278		188,655		139,987
Diluted earnings per share
As Reported	$	1.30	$	0.96	$	3.85	$	2.56
Pro forma	$	1.31	$	1.10	$	3.90	$	2.90

4. INVENTORIES

The components of inventory, net of reserves, were:


*In thousands*	September 30, 2012		December 31, 2011
Raw materials	$	165,139	$	154,885
Work-in-process		135,152		110,179
Finished goods		91,301		83,110

Total inventories	$	391,592	$	348,174

5. INTANGIBLES

Goodwill was $656.9 million and $587.5 million at September 30, 2012 and December 31, 2011, respectively. The change in the carrying amount of goodwill by segment for the nine months ended September 30, 2012 is as follows:


*In thousands*	Freight Segment		Transit Segment		Total
Balance at December 31, 2011	$	388,221	$	199,310	$	587,531
Acquisition		4,781		56,778		61,559
Adjustment to preliminary purchase allocation		2,754		1,154		3,908
Foreign currency impact		2,116		1,819		3,935

Balance at September 30, 2012	$	397,872	$	259,061	$	656,933

As of September 30, 2012 and December 31, 2011, the Company’s trademarks had a net carrying amount of $126.1 million and $114.6 million, respectively, and the Company believes these intangibles have an indefinite life. Intangible assets of the Company, other than goodwill and trademarks, consist of the following:


*In thousands*	September 30, 2012		December 31, 2011
Patents and other, net of accumulated amortization of $34,650 and $32,316	$	11,799	$	14,849
Customer relationships, net of accumulated amortization of $28,509 and $21,295		146,973		127,960

Total	$	158,772	$	142,809

The weighted average remaining useful life of patents, customer relationships and intellectual property were five years, 16 years and 17 years, respectively. Amortization expense for intangible assets was $3.9 million and $10.3 million for the three and nine months ended September 30, 2012, respectively and $4.1 million and $10.5 million for the three and nine months ended September 30, 2011, respectively.

Amortization expense for the five succeeding years is as follows (in thousands):


Remainder of 2012	$	4,521
2013		13,467
2014		12,630
2015		11,872
2016		11,715

6. LONG-TERM DEBT

Long-term debt consisted of the following:


*In thousands*	September 30, 2012		December 31, 2011
6.875% Senior Notes, due 2013	$	150,000	$	150,000
Revolving Credit Facility		282,000		245,000
Capital Leases		897		873

Total		432,897		395,873
Less—current portion		43		68

Long-term portion	$	432,854	$	395,805

2011 Refinancing Credit Agreement

On November 7, 2011, the Company refinanced its existing revolving credit and term loan facility with a consortium of commercial banks. This “2011 Refinancing Credit Agreement” provides the Company with a $600 million, five-year revolving credit facility. The Company incurred approximately $2.0 million of deferred financing cost related to the 2011 Refinancing Credit Agreement. The facility expires on November 7, 2016. The 2011 Refinancing Credit Agreement borrowings bear variable interest rates indexed to the indices described below. At September 30, 2012, the Company had available bank borrowing capacity of approximately $264.6 million, net of $53.4 million of letters of credit, subject to certain financial covenant restrictions.

Under the 2011 Refinancing Credit Agreement, the Company may elect a Base Rate of interest or an interest rate based on the London Interbank Offered Rate (“LIBOR”) of interest (“the Alternate Rate”). The Base Rate adjusts on a daily basis and is the greater of the Federal Funds Effective Rate plus 0.5% per annum, the PNC, N.A. prime rate or the Daily LIBOR Rate plus 100 basis points and an additional margin that ranges from 0 to 75 basis points. The Alternate Rate is based on quoted LIBOR rates plus a margin that ranges from 75 to 175 basis points. Both the Base Rate and Alternate Rate margins are dependent on the Company’s consolidated total indebtedness to cash flow ratios. The current Base Rate margin is 0 basis points and the Alternate Rate margin is 100 basis points.

At September 30, 2012 the weighted average interest rate on the Company’s variable rate debt was 1.23%. To reduce the impact of interest rate changes on a portion of this variable-rate debt, the Company entered into interest rate swap agreements which effectively convert a portion of the debt from a variable to a fixed-rate borrowing during the term of the swap contracts. On September 30, 2012, the notional value of the interest rate swaps outstanding was $107.0 million and effectively changed the Company’s interest rate on bank debt at September 30, 2012 from a variable rate to a fixed rate of 1.82%. The interest rate swap agreements mature on December 31, 2012. The Company is exposed to credit risk in the event of nonperformance by the counterparties. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparties are large financial institutions with excellent credit ratings and history of performance. The Company currently believes the risk of nonperformance is negligible.

Also, the Company entered into a forward starting interest rate swap agreement with a notional value of $150.0 million. Effective July 31, 2013, with a termination date of November 7, 2016, the interest rate swap agreement will convert a portion of the Company’s then outstanding debt from a variable rate to a fixed-rate borrowing. During the term of the interest rate swap agreement the interest rate on the notional value will be fixed at 1.415% plus the Alternate Rate margin.

The 2011 Refinancing Credit Agreement limits the Company’s ability to declare or pay cash dividends and prohibits the Company from declaring or making other distributions, subject to certain exceptions. The 2011 Refinancing Credit Agreement contains various other covenants and restrictions including the following limitations: incurrence of additional indebtedness; mergers, consolidations, sales of assets and acquisitions;

additional liens; sale and leasebacks; permissible investments, loans and advances; certain debt payments; and imposes a minimum interest expense coverage ratio of 3.0 and a maximum debt to cash flow ratio of 3.25. The Company does not expect that these measurements will limit the Company in executing our operating activities.

6.875% Senior Notes Due August 2013

In August 2003, the Company issued $150.0 million of Senior Notes due in 2013 (“the Notes”). The Notes were issued at par. Interest on the Notes accrues at a rate of 6.875% per annum and is payable semi-annually on January 31 and July 31 of each year. The proceeds were used to repay debt outstanding under the Company’s existing credit agreement, and for general corporate purposes. The principal balance is due in full at maturity. The Company has both the intent and ability to refinance the Notes, maturing August 2013, on a long term basis utilizing capacity under the 2011 Refinancing Credit Agreement. The 2011 Refinancing Credit Agreement will provide available bank borrowing capacity sufficient to refinance the Notes on a long-term basis. The Notes are included in the long-term portion of debt as of September 30, 2012.

The Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt and senior to all existing and future subordinated indebtedness of the Company. The indenture under which the Notes were issued contains covenants and restrictions which limit among other things, the following: the incurrence of indebtedness, payment of dividends and certain distributions, sale of assets, change in control, mergers and consolidations and the incurrence of liens.

7. EMPLOYEE BENEFIT PLANS

Defined Benefit Pension Plans

The Company sponsors defined benefit pension plans that cover certain U.S., Canadian, German, and United Kingdom employees and which provide benefits of stated amounts for each year of service of the employee.

The Company uses a December 31 measurement date for the plans. The following tables provide information regarding the Company’s defined benefit pension plans summarized by U.S. and international components.


	U.S.						International
	Three months ended September 30,						Three months ended September 30,
*In thousands, except percentages*	2012			2011			2012			2011
Net periodic benefit cost
Service cost	$	94		$	84		$	493		$	805
Interest cost		501			582			1,773			1,886
Expected return on plan assets		(771	)		(796	)		(2,035	)		(2,124	)
Net amortization/deferrals		659			710			681			533
Settlement loss recognized		—			—			844			132

Net periodic benefit cost	$	483		$	580		$	1,756		$	1,232

Assumptions
Discount rate		4.30	%		5.20	%		4.96	%		5.43	%
Expected long-term rate of return		7.50	%		8.00	%		6.12	%		6.72	%
Rate of compensation increase		3.00	%		3.00	%		3.21	%		3.17	%


	U.S.						International
	Nine months ended September 30,						Nine months ended September 30,
*In thousands, except percentages*	2012			2011			2012			2011
Net periodic benefit cost
Service cost	$	285		$	232		$	1,479		$	2,427
Interest cost		1,585			1,820			5,309			5,735
Expected return on plan assets		(2,321	)		(2,498	)		(6,085	)		(6,418	)
Net amortization/deferrals		2,272			1,923			2,032			1,551
Settlement loss recognized		—			—			1,137			720

Net periodic benefit cost	$	1,821		$	1,477		$	3,872		$	4,015

Assumptions
Discount rate		4.30	%		5.20	%		4.96	%		5.43	%
Expected long-term rate of return		7.50	%		8.00	%		6.12	%		6.72	%
Rate of compensation increase		3.00	%		3.00	%		3.21	%		3.17	%

The Company’s funding methods are based on governmental requirements and differ from those methods used to recognize pension expense. The Company expects to contribute $1.6 million to the U.S. plans and $6.4 million to the international plans during 2012.

Post Retirement Benefit Plans

In addition to providing pension benefits, the Company has provided certain unfunded postretirement health care and life insurance benefits for a portion of North American employees. The Company is not obligated to pay health care and life insurance benefits to individuals who had retired prior to 1990.

The Company uses a December 31 measurement date for all post retirement plans. The following tables provide information regarding the Company’s post retirement benefit plans summarized by U.S. and international components.


	U.S.						International
	Three months ended September 30,						Three months ended September 30,
*In thousands, except percentages*	2012			2011			2012			2011
Net periodic benefit cost
Service cost	$	(1	)	$	4		$	11		$	14
Interest cost		339			410			51			58
Net amortization/deferrals		(212	)		(186	)		(83	)		(97	)

Net periodic benefit cost	$	126		$	228		$	(21	)	$	(25	)

Assumptions
Discount rate		4.30	%		5.20	%		5.15	%		5.50	%


	U.S.						International
	Nine months ended September 30,						Nine months ended September 30,
*In thousands, except percentages*	2012			2011			2012			2011
Net periodic benefit cost
Service cost	$	18		$	24		$	33		$	42
Interest cost		1,040			1,208			151			175
Net amortization/deferrals		(613	)		(675	)		(247	)		(292	)

Net periodic benefit cost	$	445		$	557		$	(63	)	$	(75	)

Assumptions
Discount rate		4.30	%		5.20	%		5.15	%		5.50	%

8. STOCK-BASED COMPENSATION

As of September 30, 2012, the Company maintains employee stock-based compensation plans for stock options, restricted stock, restricted units, and incentive stock awards as governed by the 2011 Stock Incentive Compensation Plan (the “2011 Plan”) and the 2000 Stock Incentive Plan, as amended (the “2000 Plan”). The 2011 Plan was approved by stockholders of Wabtec on May 11, 2011. The Company also maintains a Non-Employee Directors’ Fee and Stock Option Plan (“Directors Plan”). No awards may be made under the 2000 Plan or the Directors Plan subsequent to October 31, 2016. The 2011 Plan has a 10-year term through March 27, 2021 and provides a maximum of 1,900,000 shares for grants or awards.

Stock-based compensation expense was $5.4 million and $3.9 million for the three months ended September 30, 2012 and 2011, respectively. Stock-based compensation expense was $15.4 million and $13.2 million for the nine months ended September 30, 2012 and 2011, respectively. Included in the stock-based compensation expense for the nine months ended September 30, 2012 above is $1.9 million of expense related to stock options, $3.6 million related to restricted stock, $388,000 related to restricted units, $8.9 million related to incentive stock awards and $600,000 related to awards issued for Directors’ fees. At September 30, 2012, unamortized compensation expense related to stock options, restricted stock, restricted units and incentive stock awards expected to vest totaled $25.5 million and will be recognized over a weighted average period of 1.2 years.

Stock Options Stock options are granted to eligible employees and directors at the fair market value, which is the average of the high and low Wabtec stock price on the date of grant. Under the 2011 Plan and the 2000 Plan, options become exercisable over a four-year vesting period and expire 10 years from the date of grant. Under the Directors Plan, options become exercisable over a three-year vesting period and expire 10 years from the date of grant.

The following table summarizes the Company’s stock option activity and related information for the 2011 Plan, the 2000 Plan and the Directors Plan for the nine months ended September 30, 2012:


	Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate intrinsic value (in thousands)
Outstanding at December 31, 2011		862,392		$	34.74		6.5	$	30,362
Granted		75,698			70.71				725
Exercised		(125,788	)		24.01				(7,079	)
Canceled		(26,717	)		34.46				(1,224	)

Outstanding at September 30, 2012		785,585		$	39.94		6.4	$	31,701

Exercisable at September 30, 2012		498,381		$	32.95		6.2	$	23,592

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:


	Nine months ended September 30,
	2012			2011
Dividend yield		.23	%		.08	%
Risk-free interest rate		1.35	%		2.96	%
Stock price volatility		44.95	%		45.6	%
Expected life (years)		5.0			5.0

The dividend yield is based on the Company’s dividend rate and the current market price of the underlying common stock at the date of grant. Expected life in years is determined from historical stock option exercise data. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free interest rate is based on the U.S. Treasury bond rates for the expected life of the option.

Restricted Stock, Restricted Units and Incentive Stock Beginning in 2006 the Company adopted a restricted stock program. As provided for under the 2011 and 2000 Plans, eligible employees are granted restricted stock or restricted units that generally vest over four years from the date of grant. Under the Directors Plan, restricted stock awards vest one year from the date of grant.

In addition, the Company has annually issued incentive stock awards to eligible employees that vest, upon attainment of certain three year performance goals. Based on the Company’s performance for each three year period then ended, the incentive stock awards can vest and be awarded ranging from 0% to 200% of the initial incentive stock awards granted. The incentive stock awards included in the table below represent the number of shares that are expected to vest based on the Company’s estimate for meeting those established performance targets. As of September 30, 2012, the Company estimates that it will achieve 200%, 200% and 126% for the incentive stock awards expected to vest based on performance for the three year periods ending December 31, 2012, 2013, and 2014, respectively, and has recorded incentive compensation expense accordingly. If our estimate of the number of these stock awards 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 restricted stock and incentive stock awards is based on the average of the high and low Wabtec stock price on the date of grant and recognized over the applicable vesting period.

The following table summarizes the restricted stock and unit activity for the 2011 Plan, the 2000 Plan and the Directors Plan, and incentive stock awards activity for the 2011 Plan and the 2000 Plan with related information for the nine months ended September 30, 2012:


	Restricted Stock and Units			Incentive Stock Awards			Weighted Average Grant Date Fair Value
Outstanding at December 31, 2011		274,609			646,362		$	44.04
Granted		110,980			118,660			70.85
Vested		(98,694	)		(122,079	)		35.73
Adjustment for incentive stock awards expected to vest		—			45,784			60.61
Canceled		(13,008	)		(2,219	)		42.96

Outstanding at September 30, 2012		273,887			686,508		$	53.17

9. INCOME TAXES

The overall effective income tax rate was 31.8% and 33.3% for the three and nine months ended September 30, 2012, respectively, and 33.6% and 33.2% for the three and nine months ended September 30, 2011, respectively. The decrease in the effective tax rate for the three months ended September 30, 2012 is primarily due to refund claims filed in the current quarter.

As of September 30, 2012, the liability for income taxes associated with uncertain tax positions is $9.7 million, of which $3.9 million, if recognized would favorably affect the Company’s effective tax rate. As of December 31, 2011 the liability associated with uncertain tax positions was $8.2 million, of which $2.1 million, if recognized, would favorably affect the Company’s effective tax rate.

The Company includes interest and penalties related to uncertain tax positions in income tax expense. As of September 30, 2012 the total accrued interest and penalties are $2.6 million and $1.4 million, respectively. As of December 31, 2011 the total accrued interest and penalties were $2.8 million and $1.5 million, respectively.

The Internal Revenue Service is currently auditing the 2009 and 2010 tax years. With limited exception, the Company is no longer subject to examination by various U.S. and foreign taxing authorities for years before 2009.

At this time, the Company believes that it is reasonably possible that unrecognized tax benefits of approximately $1.1 million may change within the next 12 months due to the expiration of statutory review periods and current examinations.

10. 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,
*In thousands, except per share*	2012			2011
Numerator
Numerator for basic and diluted earnings per common share—net income attributable to Wabtec shareholders	$	62,994		$	46,600
Less: dividends declared—common shares and non-vested restricted stock		(2,376	)		(1,442	)

Undistributed earnings		60,618			45,158
Percentage allocated to common shareholders(1)		99.5	%		99.5	%

		60,315			44,932
Add: dividends declared—common shares		2,364			1,435

Numerator for basic and diluted earnings per common share	$	62,679		$	46,367

Denominator
Denominator for basic earnings per common share—weighted-average shares		47,643			47,874
Effect of dilutive securities:
Assumed conversion of dilutive stock-based compensation plans		628			492

Denominator for diluted earnings per common share—adjusted weighted-average shares and assumed conversion		48,271			48,366

Net income per common share attributable to Wabtec shareholders
Basic	$	1.32		$	0.97
Diluted	$	1.30		$	0.96
(1) Basic weighted-average common shares outstanding		47,643			47,874
Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest		47,874			48,123
Percentage allocated to common shareholders		99.5	%		99.5	%


	Nine Months Ended September 30,
*In thousands, except per share*	2012			2011
Numerator
Numerator for basic and diluted earnings per common share—net income attributable to Wabtec shareholders	$	186,967		$	123,886
Less: dividends declared—common shares and non-vested restricted stock		(5,256	)		(2,407	)

Undistributed earnings		181,711			121,479
Percentage allocated to common shareholders(1)		99.5	%		99.5	%

		180,802			120,872
Add: dividends declared—common shares		5,229			2,395

Numerator for basic and diluted earnings per common share	$	186,031		$	123,267

Denominator
Denominator for basic earnings per common share—weighted-average shares		47,732			47,827
Effect of dilutive securities:
Assumed conversion of dilutive stock-based compensation plans		628			500

Denominator for diluted earnings per common share—adjusted weighted-average shares and assumed conversion		48,360			48,327

Net income per common share attributable to Wabtec shareholders
Basic	$	3.90		$	2.58
Diluted	$	3.85		$	2.56
(1) Basic weighted-average common shares outstanding		47,732			47,827
Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest		47,977			48,064
Percentage allocated to common shareholders		99.5	%		99.5	%

The Company’s non-vested restricted stock contains rights to receive nonforfeitable dividends, and thus, are participating securities requiring the two-class method of computing earnings per share. The calculation of earnings per share for common stock shown above excludes the income attributable to the non-vested restricted stock from the numerator and excludes the dilutive impact of those shares from the denominator.

11. WARRANTIES

The following table reconciles the changes in the Company’s product warranty reserve as follows:


	Nine Months Ended September 30,
*In thousands*	2012			2011
Balance at December 31, 2011 and 2010, respectively	$	50,640		$	35,513
Warranty expense		18,334			12,602
Acquisitions		494			12,008
Warranty claim payments		(11,971	)		(12,921	)

Balance at September 30, 2012 and 2011, respectively	$	57,497		$	47,202

12. FAIR VALUE MEASUREMENT

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 following table provides the liabilities carried at fair value measured on a recurring basis as of September 30, 2012, which are included in other current liabilities on the Condensed Consolidated Balance sheet:


	Total Carrying Value at September 30, 2012		Fair Value Measurements at September 30, 2012 Using
*In thousands*	Total Carrying Value at September 30, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate swap agreements		4,507		—		4,507		—

Total	$	4,507	$	—	$	4,507	$	—

The following table provides the liabilities carried at fair value measured on a recurring basis as of December 31, 2011, which is included in other current liabilities on the Condensed Consolidated Balance sheet:


	Total Carrying Value at December 31, 2011		Fair Value Measurements at December 31, 2011 Using
*In thousands*	Total Carrying Value at December 31, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Interest rate swap agreements		1,442		—		1,442		—

Total	$	1,442	$	—	$	1,442	$	—

13. COMMITMENTS AND CONTINGENCIES

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. Further information and detail on these claims is described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, in Note 18 therein, filed on February 24, 2012. During the first nine months for 2012, there were no material changes to the information described in the Form 10-K.

The Company is also subject to litigation from time to time arising out of its operations in the ordinary course of business, including claims based on product liability, contracts, intellectual property, or other causes of action. Further information and detail on any potentially material litigation is as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, in Note 18 therein, filed on February 24, 2012. During the first nine months of 2012, there were no material changes to the information described in the Form 10-K.

The Company is also subject to other commitments and contingencies arising from environmental conditions or regulations as described in its Annual Report on Form 10-K for the year ended December 31, 2011, in Note 18 therein, filed on February 24, 2012. During the first nine months of 2012, there were no material changes to the information described in the Form 10-K.

14. SEGMENT INFORMATION

Wabtec 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 business segments are:

Freight Segment primarily manufactures and services components for new and existing freight cars and locomotives, builds new switcher locomotives, rebuilds freight locomotives, supplies railway electronics, positive train control equipment, signal design and engineering services, friction products, and provides related heat exchange and cooling systems. Customers include large, publicly traded railroads, leasing companies, manufacturers of original equipment such as locomotives and freight cars, and utilities.

Transit Segment primarily manufactures and services components for new and existing passenger transit vehicles, typically subway cars and buses, builds new commuter locomotives, friction products, and refurbishes 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. Corporate activities include general corporate expenses, elimination of intersegment transactions, interest income and expense and other unallocated charges. Since certain administrative and other operating expenses and other items have not been allocated to business segments, the results in the following tables are not necessarily a measure computed in accordance with generally accepted accounting principles and may not be comparable to other companies.

Segment financial information for the three months ended September 30, 2012 is as follows:


*In thousands*	Freight Segment		Transit Segment		Corporate Activities and Elimination			Total
Sales to external customers	$	354,659	$	232,934	$	—		$	587,593
Intersegment sales/(elimination)		5,662		3,231		(8,893	)		—

Total sales	$	360,321	$	236,165	$	(8,893	)	$	587,593

Income (loss) from operations	$	75,702	$	24,385	$	(3,245	)	$	96,842
Interest expense and other, net		—		—		(4,463	)		(4,463	)

Income (loss) from operations before income taxes	$	75,702	$	24,385	$	(7,708	)	$	92,379

Segment financial information for the three months ended September 30, 2011 is as follows:


*In thousands*	Freight Segment		Transit Segment		Corporate Activities and Elimination			Total
Sales to external customers	$	315,837	$	183,003	$	—		$	498,840
Intersegment sales/(elimination)		4,626		2,955		(7,581	)		—

Total sales	$	320,463	$	185,958	$	(7,581	)	$	498,840

Income (loss) from operations	$	60,709	$	20,803	$	(6,059	)	$	75,453
Interest expense and other, net		—		—		(5,293	)		(5,293	)

Income (loss) from operations before income taxes	$	60,709	$	20,803	$	(11,352	)	$	70,160

Segment financial information for the nine months ended September 30, 2012 is as follows:


*In thousands*	Freight Segment		Transit Segment		Corporate Activities and Elimination			Total
Sales to external customers	$	1,159,653	$	621,069	$	—		$	1,780,722
Intersegment sales/(elimination)		17,214		8,659		(25,873	)		—

Total sales	$	1,176,867	$	629,728	$	(25,873	)	$	1,780,722

Income (loss) from operations	$	234,734	$	68,934	$	(11,851	)	$	291,817
Interest expense and other, net		—		—		(11,587	)		(11,587	)

Income (loss) from operations before income taxes	$	234,734	$	68,934	$	(23,438	)	$	280,230

Segment financial information for the nine months ended September 30, 2011 is as follows:


*In thousands*	Freight Segment		Transit Segment		Corporate Activities and Elimination			Total
Sales to external customers	$	860,729	$	572,269	$	—		$	1,432,998
Intersegment sales/(elimination)		12,536		4,989		(17,525	)		—

Total sales	$	873,265	$	577,258	$	(17,525	)	$	1,432,998

Income (loss) from operations	$	160,682	$	70,976	$	(33,466	)	$	198,192
Interest expense and other, net		—		—		(12,720	)		(12,720	)

Income (loss) from operations before income taxes	$	160,682	$	70,976	$	(46,186	)	$	185,472

Sales by product are as follows:


	Three Months Ended September 30,
*In thousands*	2012		2011
Specialty Products & Electronics	$	264,094	$	231,983
Remanufacturing, Overhaul & Build		129,597		83,673
Brake Products		127,027		121,372
Other Transit Products		49,141		45,753
Other		17,734		16,059

Total sales	$	587,593	$	498,840

Sales by product are as follows:


	Nine Months Ended September 30,
*In thousands*	2012		2011
Specialty Products & Electronics	$	841,382	$	622,857
Brake Products		386,640		372,815
Remanufacturing, Overhaul & Build		348,252		245,330
Other Transit Products		149,941		145,637
Other		54,507		46,359

Total sales	$	1,780,722	$	1,432,998

15. GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

Effective August 2003, the Company issued $150 million of Senior Notes due in 2013 (“the Notes”). The obligations under the Notes are fully and unconditionally guaranteed by all U.S. subsidiaries as guarantors. In accordance with positions established by the Securities and Exchange Commission, the following shows separate financial information with respect to the parent, the guarantor subsidiaries and the non-guarantor subsidiaries. The principal elimination entries eliminate investment in subsidiaries and certain intercompany balances and transactions.

Balance Sheet as of September 30, 2012:


*In thousands*	Parent			Guarantors			Non-Guarantors		Elimination			Consolidated
Cash and cash equivalents	$	76,210		$	5,622		$	200,223	$	—		$	282,055
Accounts receivable		75			243,220			186,935		—			430,230
Inventories		—			270,873			120,719		—			391,592
Other current assets		62,889			6,500			10,783		—			80,172

Total current assets		139,174			526,215			518,660		—			1,184,049
Property, plant and equipment		4,243			125,031			99,873		—			229,147
Goodwill		7,980			407,324			241,629		—			656,933
Investment in subsidiaries		3,070,357			193,978			—		(3,264,335	)		—
Other intangibles		—			166,620			118,269		—			284,889
Other long term assets		(10,340	)		3,377			47,987		—			41,024

Total Assets	$	3,211,414		$	1,422,545		$	1,026,418	$	(3,264,335	)	$	2,396,042

Current liabilities	$	48,977		$	326,916		$	164,799	$	—		$	540,692
Inter-company		1,427,896			(1,588,017	)		160,121		—			—
Long-term debt		432,000			175			679		—			432,854
Other long term liabilities		71,524			31,658			88,297		—			191,479

Total liabilities		1,980,397			(1,229,268	)		413,896		—			1,165,025
Stockholders’ equity		1,231,017			2,651,813			612,522		(3,264,335	)		1,231,017

Total Liabilities and Stockholders’ Equity	$	3,211,414		$	1,422,545		$	1,026,418	$	(3,264,335	)	$	2,396,042

Balance Sheet as of December 31, 2011:


*In thousands*	Parent			Guarantors			Non-Guarantors		Elimination			Consolidated
Cash and cash equivalents	$	75,621		$	14,024		$	195,970	$	—		$	285,615
Accounts receivable		186			196,909			149,186		—			346,281
Inventories		—			250,280			97,894		—			348,174
Other current assets		59,990			5,989			9,733		—			75,712

Total current assets		135,797			467,202			452,783		—			1,055,782
Property, plant and equipment, net		3,655			123,182			95,185		—			222,022
Goodwill		7,980			399,419			180,132		—			587,531
Investment in subsidiaries		2,675,378			183,357			—		(2,858,735	)		—
Other intangibles, net		—			174,351			83,004		—			257,355
Other long term assets		(9,946	)		5,640			40,569		—			36,263

Total assets	$	2,812,864		$	1,353,151		$	851,673	$	(2,858,735	)	$	2,158,953

Current liabilities	$	72,396		$	282,671		$	186,318		—		$	541,385
Intercompany		1,222,650			(1,303,441	)		80,791		—			—
Long-term debt		395,000			198			607		—			395,805
Other long term liabilities		75,174			33,790			65,155		—			174,119

Total liabilities		1,765,220			(986,782	)		332,871		—			1,111,309
Stockholders’ equity		1,047,644			2,339,933			518,802		(2,858,735	)		1,047,644

Total Liabilities and Stockholders’ Equity	$	2,812,864		$	1,353,151		$	851,673	$	(2,858,735	)	$	2,158,953

Income Statement for the Three Months Ended September 30, 2012:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination(1)			Consolidated
Net sales	$	—		$	405,624		$	219,621		$	(37,652	)	$	587,593
Cost of sales		(428	)		(264,211	)		(169,652	)		17,977			(416,314	)

Gross (loss) profit		(428	)		141,413			49,969			(19,675	)		171,279
Operating expenses		(14,584	)		(37,786	)		(22,067	)		—			(74,437	)

Operating (loss) profit		(15,012	)		103,627			27,902			(19,675	)		96,842
Interest (expense) income, net		(5,459	)		3,305			(916	)		—			(3,070	)
Other income (expense), net		100			(860	)		(633	)		—			(1,393	)
Equity earnings		102,624			24,971			—			(127,595	)		—

Income (loss) from operations before income tax		82,253			131,043			26,353			(147,270	)		92,379
Income tax expense		(19,259	)		(3,428	)		(6,698	)		—			(29,385	)

Net income (loss) attributable to Wabtec shareholders	$	62,994		$	127,615		$	19,655		$	(147,270	)	$	62,994

Comprehensive income (loss) attributable to Wabtec shareholders	$	62,296		$	127,615		$	31,571		$	(147,270	)	$	74,212

(1)	Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Three Months Ended September 30, 2011:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination(1)			Consolidated
Net sales	$	—		$	352,493		$	182,465		$	(36,118	)	$	498,840
Cost of sales		(903	)		(216,913	)		(147,007	)		13,134			(351,689	)

Gross (loss) profit		(903	)		135,580			35,458			(22,984	)		147,151
Operating expenses		(16,021	)		(37,922	)		(17,755	)		—			(71,698	)

Operating (loss) profit		(16,924	)		97,658			17,703			(22,984	)		75,453
Interest (expense) income, net		(5,538	)		1,178			596			—			(3,764	)
Other income (expense), net		173			211			(1,913	)		—			(1,529	)
Equity earnings		82,561			21,337			—			(103,898	)		—

Income (loss) from operations before income tax		60,272			120,384			16,386			(126,882	)		70,160
Income tax expense		(13,672	)		(2,868	)		(7,020	)		—			(23,560	)

Net income (loss) attributable to Wabtec shareholders	$	46,600		$	117,516		$	9,366		$	(126,882	)	$	46,600

Comprehensive income (loss) attributable to Wabtec shareholders	$	48,788		$	117,516		$	(28,426	)	$	(126,882	)	$	10,996

(1)	Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Nine Months Ended September 30, 2012:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination(1)			Consolidated
Net sales	$	—		$	1,251,666		$	653,230		$	(124,174	)	$	1,780,722
Cost of sales		(776	)		(810,101	)		(507,413	)		51,655			(1,266,635	)

Gross (loss) profit		(776	)		441,565			145,817			(72,519	)		514,087
Operating expenses		(47,356	)		(115,649	)		(59,265	)		—			(222,270	)

Operating (loss) profit		(48,132	)		325,916			86,552			(72,519	)		291,817
Interest (expense) income, net		(16,291	)		5,489			499			—			(10,303	)
Other income (expense), net		8,221			(6,954	)		(2,551	)		—			(1,284	)
Equity earnings		304,263			61,931			—			(366,194	)		—

Income (loss) from operations before income tax		248,061			386,382			84,500			(438,713	)		280,230
Income tax expense		(61,094	)		(10,239	)		(21,930	)		—			(93,263	)

Net income (loss) attributable to Wabtec shareholders	$	186,967		$	376,143		$	62,570		$	(438,713	)	$	186,967

Comprehensive income (loss) attributable to Wabtec shareholders	$	186,486		$	376,143		$	68,868		$	(438,713	)	$	192,784

(1)	Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Nine Months Ended September 30, 2011:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination(1)			Consolidated
Net sales	$	—		$	1,006,000		$	527,089		$	(100,091	)	$	1,432,998
Cost of sales		(1,282	)		(645,743	)		(405,980	)		43,097			(1,009,908	)

Gross (loss) profit		(1,282	)		360,257			121,109			(56,994	)		423,090
Operating expenses		(64,002	)		(106,670	)		(54,226	)		—			(224,898	)

Operating (loss) profit		(65,284	)		253,587			66,883			(56,994	)		198,192
Interest (expense) income, net		(16,501	)		3,463			1,797			—			(11,241	)
Other income (expense), net		7,567			(816	)		(8,230	)		—			(1,479	)
Equity earnings		231,392			49,370			—			(280,762	)		—

Income (loss) from operations before income tax		157,174			305,604			60,450			(337,756	)		185,472
Income tax expense		(33,288	)		(9,897	)		(18,401	)		—			(61,586	)

Net income (loss) attributable to Wabtec shareholders	$	123,866		$	295,707		$	42,049		$	(337,756	)	$	123,886

Comprehensive income (loss) attributable to Wabtec shareholders	$	126,663		$	295,707		$	31,353		$	(337,756	)	$	115,967

(1)	Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Condensed Statement of Cash Flows for the Nine Months Ended September 30, 2012:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used for) provided by operating activities	$	(4,856	)	$	390,163		$	166,931		$	(438,713	)	$	113,525
Net cash used for investing activities		(3,841	)		(22,366	)		(99,860	)		—			(126,067	)
Net cash provided by (used for) financing activities		9,286			(376,199	)		(62,506	)		438,713			9,294
Effect of changes in currency exchange rates		—			—			(312	)		—			(312	)

Increase (decrease) in cash		589			(8,402	)		4,253			—			(3,560	)
Cash, beginning of year		75,621			14,024			195,970			—			285,615

Cash, end of period	$	76,210		$	5,622		$	200,223		$	—		$	282,055

Condensed Statement of Cash Flows for the Nine Months Ended September 30, 2011:


*In thousands*	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash provided by (used for) operating activities	$	9,543		$	321,525		$	106,708		$	(337,756	)	$	100,020
Net cash used for investing activities		(4,082	)		(30,033	)		(39,548	)		—			(73,663	)
Net cash (used for) provided by financing activities		(33,944	)		(295,753	)		(41,923	)		337,756			(33,864	)
Effect of changes in currency exchange rates		—			—			(8,298	)		—			(8,298	)

(Decrease) increase in cash		(28,483	)		(4,261	)		16,939			—			(15,805	)
Cash, beginning of year		42,714			13,226			181,001			—			236,941

Cash, end of period	$	14,231		$	8,965		$	197,940		$	—		$	221,136

16. OTHER INCOME (EXPENSE), NET

The components of other income (expense) are as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
*In thousands*	2012			2011			2012			2011
Foreign currency loss	$	(1,468	)	$	(1,795	)	$	(427	)	$	(2,061	)
Other miscellaneous income (expense)		75			266			(857	)		582

Total other (expense) income, net	$	(1,393	)	$	(1,529	)	$	(1,284	)	$	(1,479	)

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, 2011, filed with the Securities and Exchange Commission on February 24, 2012.

OVERVIEW

Management Review and Future Outlook

Wabtec’s long-term financial goals are to generate cash flow in excess of net income, maintaining a strong credit profile while minimizing our overall cost of capital; increase margins through strict attention to cost controls and implementation of the Wabtec Performance System; and increase revenues through a focused growth strategy, including global and market expansion, new products and technologies, aftermarket products and services, and acquisitions. In addition, Management evaluates the Company’s current operational performance through measures such as quality and on-time delivery.

The Company monitors a variety of factors and statistics to gauge market activity. The North America freight rail industry is largely driven by general economic conditions, which can cause fluctuations in rail traffic. Based on those fluctuations, railroads can increase or decrease purchases of new locomotives and freight cars. In 2011 U.S. freight rail traffic increased due to the improving overall economy, which had a favorable effect on the Company’s Freight Segment, with increased demand for new locomotives and freight cars, and for aftermarket products and services. Through mid-October, 2012 compared to the previous year, according to the Association of American Railroads, carloadings decreased 2.7% and revenue ton-miles decreased 1.7%, while intermodal loadings increased 3.7%. Excluding coal, carloadings increased 3.1%. In 2012, the number of new locomotives delivered is expected to be about 1,200 compared to about 1,100 in 2011. The number of new freight cars delivered is expected to be about 60,000 compared to about 47,000 in 2011.

The North American transit rail industry is driven by government spending and ridership. According to the American Public Transportation Association, ridership increased 2.3% in 2011 and 2% in the second quarter of 2012. In June 2012, the U.S. federal government passed a two-year transportation funding bill, called MAP-21. As part of this bill, funding for transit programs is expected to be about $10.5 billion in each of the next two fiscal years, about the same as it was in the previous three years. Most government entities at all levels continue to face budget issues, which could have a negative effect on demand for the Company’s products and services.

In 2008, the U.S. government enacted rail safety legislation that requires certain freight and passenger railroads to equip certain locomotives with positive train control (“PTC”) technology by the end of 2015. This technology includes an on-board locomotive computer and related software, which are being developed by Wabtec. As the industry leader, Wabtec expects to benefit from increased sales of train control-related products and engineering services as the technology is deployed throughout the industry. Wabtec expects PTC revenue to exceed $200 million in 2012 compared to about $125 million in 2011.

Wabtec continues to expand its presence in freight rail and passenger transit markets outside the U.S., particularly in Europe, Asia-Pacific and South America. In Europe, the majority of the rail system serves the passenger transit market, which is larger than the transit market in the U.S. Our presence in the U.K., Germany, Italy and the Netherlands has positioned the Company to take advantage of this market. Asia-Pacific is a growth market and our various joint ventures and direct exports to China have positioned the Company to take advantage of this growth. Economic growth in Australia and Brazil led to growth for the Company in those markets as commodity suppliers use our products to meet the demands of their regional customers.

This year and beyond, general economic and market conditions in the United States and internationally could have an impact on our sales and operations. To the extent that these factors cause instability of capital markets, shortages of raw materials or component parts, longer sales cycles, deferral or delay of customer orders or an inability to market our products effectively, our business and results of operations could be materially adversely affected. In addition, we face risks associated with our four-point growth strategy including the level of investment that customers are willing to make in new technologies developed by the industry and the Company, and risks inherent in global expansion. When necessary, we will modify our financial and operating strategies to reflect changes in market conditions and risks.

RESULTS OF OPERATIONS

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


	Three Months Ended September 30,						Nine Months Ended September 30,
*In millions*	2012			2011			2012			2011
Net sales	$	587.6		$	498.9		$	1,780.7		$	1,433.0
Cost of sales		(416.3	)		(351.7	)		(1,266.6	)		(1,009.9	)

Gross profit		171.3			147.2			514.1			423.1
Selling, general and administrative expenses		(59.8	)		(57.7	)		(180.9	)		(186.4	)
Engineering expenses		(10.8	)		(9.9	)		(31.1	)		(27.9	)
Amortization expense		(3.9	)		(4.1	)		(10.3	)		(10.6	)

Total operating expenses		(74.5	)		(71.7	)		(222.3	)		(224.9	)
Income from operations		96.8			75.5			291.8			198.2
Interest expense, net		(3.0	)		(3.8	)		(10.3	)		(11.2	)
Other income (expense), net		(1.4	)		(1.5	)		(1.3	)		(1.5	)

Income from operations before income taxes		92.4			70.2			280.2			185.5
Income tax expense		(29.4	)		(23.6	)		(93.2	)		(61.6	)

Net income attributable to Wabtec shareholders	$	63.0		$	46.6		$	187.0		$	123.9

THIRD QUARTER 2012 COMPARED TO THIRD QUARTER 2011

The following table summarizes the results of operations for the period:


	Three months ended September 30,
*In thousands*	2012		2011		Percent Change
Freight Segment	$	354,659	$	315,837		12.3	%
Transit Segment		232,934		183,003		27.3	%

Net sales		587,593		498,840		17.8	%
Income from operations		96,842		75,453		28.3	%
Net income attributable to Wabtec shareholders	$	62,994	$	46,600		35.2	%

The following table shows the major components of the change in sales in the third quarter of 2012 from the third quarter of 2011:


*In thousands*	Freight Segment			Transit Segment			Total
Third Quarter 2011 Net Sales	$	315,837		$	183,003		$	498,840
Acquisitions		19,199			19,212			38,411
Change in Sales by Product Line:
Remanufacturing, Overhaul & Build		4,873			24,711			29,584
Specialty Products & Electronics		9,837			5,030			14,867
Brake Products		5,735			4,410			10,145
Other Transit Products		—			3,973			3,973
Other		1,001			(34	)		967
Foreign Exchange		(1,823	)		(7,371	)		(9,194	)

Third Quarter 2012 Net Sales	$	354,659		$	232,934		$	587,593

Net sales increased by $88.7 million to $587.6 million from $498.9 million for the three months ended September 30, 2012 and 2011, respectively. The increase is due to sales from acquisitions of $38.4 million; $29.6 million for Remanufacturing, Overhaul and Build sales from increased demand for freight original equipment locomotives and aftermarket services for locomotives; $14.9 million for Specialty Products and Electronics sales from increased demand for freight original equipment rail products, positive train control electronics and aftermarket products; and $10.1 million for Brake Products sales due to higher demand for original equipment brakes. Company net sales decreased $9.2 million and income from operations decreased $1.1 million due to unfavorable effects of foreign exchange. Net income for the three months ended September 30, 2012 was $63.0 million or $1.30 per diluted share. Net income for the three months ended September 30, 2011 was $46.6 million or $0.96 per diluted share.

Freight Segment sales increased by $38.8 million, or 12.3%, due to $19.2 million from acquisitions; $9.8 million for Specialty Products and Electronics, primarily resulting from increased demand for original equipment rail products, positive train control electronics and aftermarket rail products; $5.7 million for Brake Products; and $4.9 million from demand for freight original equipment locomotives and aftermarket services for locomotives. For the Freight Segment, net sales decreased by $1.8 million due to unfavorable effects of foreign exchange.

Transit Segment sales increased by $49.9 million, or 27.3%, due to higher sales of $24.7 million from increased demand for transit car rebuild and overhauls; $19.2 million from acquisitions; $5.0 million of electronic sales from increased demand for transit positive train control electronics; $4.4 million for Brake Products; and $4.0 million from certain transit car build contracts and demand for transit bus doors. For the Transit Segment, net sales decreased by $7.4 million due to unfavorable effects of foreign exchange.

Cost of Sales and Gross Profit. Cost of Sales increased by $64.6 million to $416.3 million in the third quarter of 2012 compared to $351.7 million in the same period of 2011. In the third quarter of 2012, cost of sales, as a percentage of sales was 70.9% compared to 70.5% in the same period of 2011.

Raw material costs decreased as a percentage of sales to approximately 43% in the third quarter of 2012 from 45% in the same period of 2011. Labor costs increased as a percentage of sales to approximately 12% in the third quarter of 2012 from 11% in the same period of 2011. Overhead costs increased as a percentage of sales to approximately 16% in the third quarter of 2012 from 15% in the same period of 2011. Freight Segment raw material costs decreased as a percentage of sales to approximately 43% in the third quarter of 2012 from 46% in the same period of 2011. Freight Segment labor costs increased as a percentage of sales to approximately 11% in the third quarter of 2012 from 9% in the same period of 2011, and overhead costs increased as a percentage of sales to approximately 15% in the third quarter of 2012 from 14% in the same period of 2011. Transit Segment raw material costs increased as a percentage of sales to approximately 43% in the third quarter of 2012 from 42%

in the same period of 2011. Transit Segment labor costs decreased as a percentage of sales to approximately 13% in the third quarter of 2012 from 14% in the same period of 2011, and overhead costs increased as a percentage of sales to approximately 19% in the third quarter of 2012 from 17% in the same period of 2011. Freight Segment material costs decreased as a percentage of sales due to favorable raw material pricing and product mix. Freight Segment labor costs increased as a percentage of sales due to higher service related sales, which carry high labor costs on a percentage basis.

In general, raw material costs decreased as a percentage of sales reflecting a higher mix of revenue generated from service related sales, which has a lower raw material component as cost of sales. Overhead costs vary as a percentage of sales depending on product mix and changes in sales volume.

In addition, included in cost of sales is warranty expense. The provision for warranty expense is generally established for specific losses, along with historical estimates of customer claims as a percentage of sales, which can cause variability in warranty expense between quarters. Warranty expense was $2.2 million higher in the third quarter of 2012 compared to the same period of 2011 due to increased sales and increases for certain transit contracts. As a percentage of sales, warranty expense was 0.9% for the third quarter of 2012 compared to 0.6% for the same period in the previous year.

Gross profit increased to $171.3 million in the third quarter of 2012 compared to $147.2 million in the same period of 2011, for the reasons discussed above. Accordingly, for the third quarter of 2012, gross profit, as a percentage of sales, was 29.1% compared to 29.5%, for the third quarter of 2011.

Operating expenses The following table shows our operating expenses:


	Three months ended September 30,
*In thousands*	2012		2011		Percent Change
Selling, general and administrative expenses	$	59,743	$	57,676		3.6	%
Engineering expenses		10,753		9,894		8.7	%
Amortization expense		3,941		4,128		(4.5	)%

Total operating expenses	$	74,437	$	71,698		3.8	%

Selling, general, and administrative expenses increased $2.1 million in the third quarter of 2012 compared to the same period of 2011 primarily due to $5.6 million of expenses from acquisitions and $1.6 million of incentive and non-cash compensation, partially offset by a decrease of $1.6 million for other legal costs and a $3.5 million decrease in selling, general and administrative expenses resulting from cost saving initiatives. Engineering expense increased by $0.9 million in the third quarter of 2012 compared to the same period of 2011 as the company focused engineering resources on product development. Costs related to engineering for specific customer contracts are included in cost of sales. Total operating expenses were 12.7% and 14.4% of sales for the third quarter of 2012 and 2011, respectively.

The following table shows our segment operating expense:


	Three months ended September 30,
*In thousands*	2012		2011		Percent Change
Freight Segment	$	37,621	$	36,589		2.8	%
Transit Segment		33,571		29,050		15.6	%
Corporate		3,245		6,059		(46.4	)%

Total operating expenses	$	74,437	$	71,698		3.8	%

Segment operating expenses consist of specific segment costs such as, sales and marketing, information technology, insurance, and audit and tax fees, allocated corporate costs, and other segment specific discrete charges. Corporate costs are allocated to the freight and transit segments based on segment revenues. Certain corporate departmental expenses are not allocated.

Freight segment operating expenses increased $1.0 million in the third quarter of 2012 compared to the same period of 2011 because of $2.0 million of incremental expense from acquisitions, partially offset by a decrease in selling, general and administrative expenses realized from cost saving initiatives. Freight segment operating expenses were 10.4% and 11.4% of sales for the third quarter of 2012 and 2011, respectively.

Transit segment operating expenses increased $4.5 million in the third quarter of 2012 compared to the same period of 2011 because of $3.6 million of incremental expense from acquisitions and an increase of $0.9 million in the expenses allocated to the operating segments. Transit segment operating expenses were 14.5% and 15.6% of sales for the third quarter of 2012 and 2011, respectively.

Corporate non-allocated operating expenses decreased $2.8 million in the third quarter of 2012 compared to the same period of 2011 primarily due to other legal cost discussed above and decreases in other non-allocated departmental expenses.

Income from operations Income from operations totaled $96.8 million or 16.5% of sales in the third quarter of 2012 compared to $75.5 million or 15.1% of sales in the same period of 2011. Income from operations increased due to higher sales volume, partially offset by higher operating expenses discussed above.

Interest expense, net Overall interest expense, net, was comparable to the prior period.

Other income (expense), net The Company recorded foreign exchange losses of $1.5 million and $1.8 million, in the third quarter of 2012 and 2011, respectively, due to the effect of currency exchange rate changes on intercompany transactions that are non U.S. dollar denominated and charged or credited to earnings.

Income taxes The effective income tax rate was 31.8% and 33.6% for the third quarter of 2012 and 2011, respectively. The decrease in the effective rate is primarily due to refund claims filed in the current quarter.

Net income Net income for the third quarter of 2012 increased $16.4 million, compared with the same period of 2011. The increase in net income is due to higher sales volume and lower effective tax rate, partially offset by higher operating expenses discussed above.

FIRST NINE MONTHS OF 2012 COMPARED TO FIRST NINE MONTHS OF 2011

The following table summarizes the results of operations for the period:


	Nine months ended September 30,
*In thousands*	2012		2011		Percent Change
Freight Segment	$	1,159,653	$	860,729		34.7	%
Transit Segment		621,069		572,269		8.5	%

Net sales		1,780,722		1,432,998		24.3	%
Income from operations		291,817		198,192		47.2	%
Net income attributable to Wabtec shareholders	$	186,967	$	123,886		50.9	%

The following table shows the major components of the change in sales in the first nine months of 2012 from the first nine months of 2011:


*In thousands*	Freight Segment			Transit Segment			Total
First Nine Months of 2011 Net Sales	$	860,729		$	572,269		$	1,432,998
Acquisitions		59,775			36,836			96,611
Change in Sales by Product Line:
Specialty Products & Electronics		149,911			12,602			162,513
Remanufacturing, Overhaul & Build		52,256			18,748			71,004
Brake Products		34,321			(10,238	)		24,083
Other Transit Products		—			5,875			5,875
Other		7,758			835			8,593
Foreign Exchange		(5,097	)		(15,858	)		(20,955	)

First Nine Months of 2012 Net Sales	$	1,159,653		$	621,069		$	1,780,722

Net sales increased by $347.7 million to $1,780.7 million from $1,433.0 million for the nine months ended September 30, 2012 and 2011, respectively. The increase is due to higher sales of $162.5 million for Specialty Products and Electronics from increased demand for freight original equipment rail products, positive train control electronics and aftermarket products; $96.6 million from acquisitions; $71.0 million for Remanufacturing, Overhaul Build sales from increased demand for freight original equipment locomotives and aftermarket services for locomotives; $24.1 million for Brake Products sales due to higher demand for original equipment brakes; and $8.6 million for other products primarily from increased international demand. Company net sales decreased $21.0 million and income from operations decreased $2.0 million due to unfavorable effects of foreign exchange. Net income for the nine months ended September 30, 2012 was $187.0 million or $3.85 per diluted share. Net income for the nine months ended September 30, 2011 was $123.9 million or $2.56 per diluted share. Net income increased due to higher sales volume and decreased operating expenses discussed below.

Freight Segment sales increased by $298.9 million, or 34.7%, due to higher sales of $149.9 million for Specialty Products and Electronics, primarily resulting from increased demand for original equipment rail products, positive train control electronics and aftermarket rail products; $59.8 million from acquisitions; $52.3 million from demand for freight original equipment locomotives and aftermarket services for locomotives; and $34.3 million for Brake Products. For the Freight Segment, net sales decreased by $5.1 million due to unfavorable effects of foreign exchange.

Transit Segment sales increased by $48.8 million, or 8.5%, due to $36.8 million from acquisitions; higher sales of $18.7 million from demand for overhaul and aftermarket services; and $12.6 million of higher electronic sales from increased demand for transit positive train control electronics. Partially offsetting these increases was a decrease of $10.2 million from decreased demand for transit brake products and the completion of certain transit locomotive build contracts. For the Transit Segment, net sales decreased by $15.9 million due to unfavorable effects of foreign exchange.

Cost of Sales and Gross Profit Cost of Sales increased by $256.7 million to $1,266.6 million in the first nine months of 2012 compared to $1,009.9 million in the same period of 2011. In the first nine months of 2012, cost of sales, as a percentage of sales was 71.1% compared to 70.5% in the same period of 2011.

Raw material costs as a percentage of sales were approximately 43% in the first nine months of 2012 and 2011. Labor costs as a percentage of sales were approximately 11% in the first nine months of 2012 and 2011. Overhead costs as a percentage of sales were approximately 17% in the first nine months of 2012 and 2011. Freight Segment raw material costs as a percentage of sales were approximately 44% in the first nine months of 2012 and 2011. Freight Segment labor costs increased as a percentage of sales to approximately 11% in the first nine months of 2012 from 10% in the same period of 2011, and overhead costs as a percentage of sales were approximately 15% in the first nine months of 2012 and 2011. Transit Segment raw material costs decreased as a percentage of sales to

approximately 42% in the first nine months of 2012 from 43% in the same period of 2011. Transit Segment labor costs increased as a percentage of sales to approximately 13% in the first nine months of 2012 from 12% in the same period of 2011, and overhead costs increased as a percentage of sales to approximately 19% in the first nine months of 2012 from 18% in the same period of 2011. Transit Segment labor costs increased as a percentage of sales due to higher service related sales, which carry higher labor costs on a cost of sales percentage basis. Overhead costs vary as a percentage of sales depending on product mix and changes in sales volume.

In addition, included in cost of sales is warranty expense. The provision for warranty expense is generally established for specific losses, along with historical estimates of customer claims as a percentage of sales, which can cause variability in warranty expense between quarters. Warranty expense was $5.7 million higher in the first nine months of 2012 compared to the same period of 2011 due to increased sales and increases for certain transit contracts. As a percentage of sales, warranty expense was 1.0% for the first nine months of 2012 compared to 0.8% for the same period in the previous year.

Gross profit increased to $514.1 million in the first nine months of 2012 compared to $423.1 million in the same period of 2011, for the reasons discussed above. Accordingly, for the first nine months of 2012, gross profit, as a percentage of sales, was 28.9% compared to 29.5%, for the first nine months of 2011.

Operating expenses The following table shows our operating expenses:


	Nine months ended September 30,
*In thousands*	2012		2011		Percent Change
Selling, general and administrative expenses	$	180,935	$	186,435		(3.0	)%
Engineering expenses		31,047		27,914		11.2	%
Amortization expense		10,288		10,549		(2.5	)%

Total operating expenses	$	222,270	$	224,898		(1.2	)%

Selling, general, and administrative expenses decreased $5.5 million in the first nine months of 2012 compared to the same period of 2011. The decrease is due primarily due to an $18.1 million charge for a court ruling, partially offset by a benefit of $2.4 million for a settlement related to a prior acquisition which were both recorded in the second quarter of 2011. Increases include $10.8 million of expenses from acquisitions, and $4.3 million of incentive and non-cash compensation. Engineering expense increased by $3.1 million in the first nine months of 2012 compared to the same period of 2011 as the company focused engineering resources on product development. Costs related to engineering for specific customer contracts are included in cost of sales. Amortization expense decreased slightly in the first nine months of 2012 compared to the same period in 2011 due to amortization of intangibles in 2011 associated with acquisitions. Total operating expenses were 12.5% and 15.7% of sales for the first nine months of 2012 and 2011, respectively.

The following table shows our segment operating expenses:


	Nine months ended September 30,
*In thousands*	2012		2011		Percent Change
Freight Segment	$	118,661	$	107,220		10.7	%
Transit Segment		91,758		84,212		9.0	%
Corporate		11,851		33,466		(64.6	)%

Total operating expenses	$	222,270	$	224,898		(1.2	)%

Freight segment operating expenses increased $11.4 million in the first nine months of 2012 compared to the same period of 2011 because of $5.6 million of expenses from acquisitions, an increase of $3.4 million in expenses allocated to the operating segments and an increase in selling, general and administrative expense supporting higher sales volume. Freight segment operating expenses were 10.1% and 12.3% of sales for the first nine months of 2012 and 2011, respectively.

Transit segment operating expenses increased $7.5 million in the first nine months of 2012 compared to the same period of 2011 because of $5.2 million of expenses from acquisitions and a benefit of $2.4 million for a settlement related to a prior acquisition which was recorded in the second quarter of 2011, an increase of $0.3 million in the expenses allocated to the operating segments, partially offset by a decrease in other selling, general and administrative expenses from cost saving initiatives. Transit segment operating expenses were 14.7% and 14.6% of sales for the first nine months of 2012 and 2011, respectively.

Corporate non-allocated operating expenses decreased $21.6 million in the first nine months of 2012 compared to the same period of 2011 because of the charge for a court ruling discussed above and decreases in other non-allocated departmental expenses.

Income from operations Income from operations totaled $291.8 million or 16.4% of sales in the first nine months of 2012 compared to $198.2 million or 13.8% of sales in the same period of 2011. Income from operations increased due to higher sales volume and decreased operating expenses discussed above.

Interest expense, net Overall interest expense, net, was comparable to the prior period.

Other income (expense), net The Company recorded foreign exchange losses of $0.4 million and $2.1 million in the first nine months of 2012 and 2011, respectively, due to the effect of currency exchange rate changes on intercompany transactions that are non U.S. dollar denominated and charged or credited to earnings.

Income taxes The effective income tax rate was 33.3% and 33.2% for the first nine months of 2012 and 2011, respectively.

Net income Net income for the first nine months of 2012 increased $63.1 million, compared with the same period of 2011. The increase in net income is due to higher sales volume and decreased operating expenses discussed above.

Liquidity and Capital Resources

Liquidity is provided primarily by operating cash flow and borrowings under the Company’s unsecured credit facility with a consortium of commercial banks. The following is a summary of selected cash flow information and other relevant data:


	Nine months ended September 30,
*In thousands*	2012			2011
Cash provided by (used for):
Operating activities	$	113,525		$	100,020
Investing activities		(126,067	)		(73,663	)
Financing activities		9,294			(33,864	)
Decrease in cash	$	(3,560	)	$	(15,805	)

Operating activities In the first nine months of 2012 and 2011, cash provided by operations was $113.5 million and $100.0 million, respectively. In comparison to the first nine months of 2011, cash provided by operations in 2012 resulted from higher net income and higher non-cash items, offset by a net increase in working capital. In 2012, accounts receivable increased by $71.4 million, due to higher sales, and inventory increased by $26.6 million from the prior year due to certain Transit Segment contracts and to support the higher

sales volume. Accounts payable decreased by $18.6 million due to timing of payments and accrued income taxes decreased by $17.4 million due to payments. All other operating assets and liabilities, net, provided cash of $15.9 million due primarily to an increase of $30.3 million in customer deposits for certain contracts and the payment timing of certain accrued liabilities. In 2011, accounts receivable increased by $80.3 million and inventory increased by $63.4 million from the prior year. Accounts payable decreased by $3.7 million. All other operating assets and liabilities, net, provided cash of $72.2 million due primarily to the accrual of $18.1 million for a court ruling, a $44.3 million increase in customer deposits for certain contracts and the payment timing of certain accrued liabilities.

Investing activities In the first nine months of 2012 and 2011, cash used in investing activities was $126.1 million and $73.7 million, respectively. Net cash paid for acquisitions was $102.3 million and $51.8 million for the first nine months of 2012 and 2011, respectively. Refer to Note 3 of the “Notes to Condensed Consolidated Financial Statements” for additional information on acquisitions. Capital expenditures were $24.7 million and $22.2 million in the first nine months of 2012 and 2011, respectively.

Financing activities In the first nine months of 2012, cash provided by financing activities was $9.2 million, which included $211.0 million in proceeds from debt and $174.0 million of repayments of debt on the revolving credit facility, $5.3 million of dividend payments and $28.0 million for the repurchase of 376,300 shares of stock. In the first nine months of 2011, cash used in financing activities was $33.9 million, which included $124.0 million in proceeds from debt and $110.0 million of repayments of debt on the revolving credit facility, $29.9 million of debt repayments on the term loan and other debt, $2.4 million of dividend payments and $23.8 million for the repurchase of 403,600 shares of stock.

The following table shows outstanding indebtedness at September 30, 2012 and December 31, 2011.


*In thousands*	September 30, 2012		December 31, 2011
6.875% Senior Notes, due 2013	$	150,000	$	150,000
Revolving Credit Facility		282,000		245,000
Capital Leases		897		873

Total		432,897		395,873
Less—current portion		43		68

Long-term portion	$	432,854	$	395,805

Cash balance at September 30, 2012 and December 31, 2011 was $282.1 million and $285.6 million, respectively.

2011 Refinancing Credit Agreement

Refer to Note 6 of the “Notes to Condensed Consolidated Financial Statements” for additional information regarding the 2011 Refinancing Credit Agreement.

6.875% Senior Notes Due August 2013

utilizing capacity under the 2011 Refinancing Credit Agreement. The 2011 Refinancing Credit Agreement will provide available bank borrowing capacity sufficient to refinance the Notes on a long-term basis. The Notes are included in the long-term portion of debt as of September 30, 2012. The Company is in compliance with the restrictions and covenants in the indenture under which the Notes were issued and expects that these restrictions and covenants will not be any type of limiting factor in executing our operating activities. Refer to Note 6 of the “Notes to Condensed Consolidated Financial Statements” for additional information regarding the Notes.

Management believes that based on current levels of operations and forecasted earnings, cash flow and liquidity will be sufficient to fund working capital and capital equipment needs as well as meeting debt service requirements. If sources of funds were to fail to satisfy the Company’s cash requirements, the Company may need to refinance our existing debt or obtain additional financing. There is no assurance that such new financing alternatives would be available, and, in any case, such new financing, if available, may be more costly and burdensome than the debt agreements currently in place.

Company Stock Repurchase Plan

On May 11, 2011, the Board of Directors increased its stock repurchase authorization to $150 million of the Company’s outstanding shares. Through September 30, 2012, repurchases are $54.0 million, leaving $96.0 million under the authorization. This share repurchase authorization supersedes the previous authorization of $150 million of which $39.4 million was remaining.

The Company intends to purchase shares on the open market or in negotiated or block trades. No time limit was set for the completion of the programs which conforms to the requirements under the 2011 Refinancing Credit Agreement, as well as the Notes currently outstanding.

During the first nine months of 2012, the Company repurchased 376,300 shares of its stock at an average price of $74.40 per share. During 2011, the Company repurchased 438,600 shares of its stock at an average price of $59.33 per share. All purchases were on the open market.

Contractual Obligations and Off-Balance Sheet Arrangements

As of September 30, 2012, the Company has recognized a total liability of $9.7 million for unrecognized tax benefits related to uncertain tax positions. At this time, the Company is unable to make a reasonably reliable estimate of the timing of cash settlement for any of the unrecognized tax benefits due to the uncertainty of the timing and outcome of its audits and other factors.

Since December 31, 2011, there have been no other significant changes in the total amount of the Company’s contractual obligations or the timing of cash flows in accordance with those obligations, as reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

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

•

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

•

demand for our products and services;

•

orders either being delayed, cancelled, not returning to historical levels, or reduced or any combination of the foregoing;

•

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; or

•

availability of credit;

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 relations;

•

completion and integration of acquisitions; or

•

the development and use of new technology;

Competitive factors

•

the actions of competitors;

Political/governmental factors

•

political stability in relevant areas of the world;

•

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; or

•

the outcome of our existing or any future legal proceedings, including litigation involving our principal customers and any litigation with respect to environmental, asbestos-related matters and pension liabilities; and

Transaction or commercial factors

•

the outcome of negotiations with partners, governments, suppliers, customers or others.

Statements in this 10-Q apply only as of the date on which such statements are made, and 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, 2011.

Critical Accounting Policies

A summary of critical accounting policies is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011. In particular, judgment is used in areas such as accounts receivable and the allowance for doubtful accounts, inventories, goodwill and indefinite-lived intangibles, warranty reserves, pensions and postretirement benefits, income taxes and revenue recognition. There have been no significant changes in accounting policies since December 31, 2011.

Item 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

In the ordinary course of business, Wabtec is exposed to risks that increases in interest rates may adversely affect funding costs associated with its variable-rate debt. The Company’s variable rate debt represents 40% and 35% of total long-term debt at September 30, 2012 and December 31, 2011, respectively. On an annual basis a 1% change in the interest rate for variable rate debt at September 30, 2012 would increase or decrease interest expense by about $1.8 million. To reduce the impact of interest rate changes on a portion of this variable-rate debt, the Company entered into interest rate swap agreements which effectively converted a portion of the debt from variable to fixed-rate borrowings during the term of the swap contracts. Refer to “Financial Derivatives and Hedging Activities” in Note 2 of “Notes to Condensed Consolidated Financial Statements” for additional information regarding interest rate risk.

Foreign Currency Exchange Risk

The Company is subject to certain risks associated with changes in foreign currency exchange rates to the extent our operations are conducted in currencies other than the U.S. dollar. For the first nine months of 2012, approximately 50% of Wabtec’s net sales were to customers in the United States, 10% in the United Kingdom, 9% in Australia, 8% in Canada, 6% in Mexico, 2% in Germany and 15% in other international locations. To reduce the impact of changes in currency exchange rates, the Company has periodically entered into foreign currency forward contracts. Refer to “Financial Derivatives and Hedging Activities” in Note 2 of “Notes to Condensed Consolidated Financial Statements” for more information regarding 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, 2012. 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, 2012, that has materially affected, or is reasonably likely to materially affect, Wabtec’s internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1.

LEGAL PROCEEDINGS

There have been no material changes regarding the Company’s commitments and contingencies as described in Note 18 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

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, 2011.

Item 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On May 11, 2011, the Board of Directors increased its stock repurchase authorization to $150 million of the Company’s outstanding shares. Through September 30, 2012 repurchases are $54.0 million, leaving $96.0 million under the authorization. This share repurchase authorization supersedes the previous authorization of $150 million, of which $39.4 million was remaining.

During the first nine months of 2012, the Company repurchased 376,300 shares of its stock at an average price of $74.40 per share. All purchases were on the open market.


Period	Total Number of Shares Purchased		Average Price Paid per Share		Number of Shares Purchased for Announced Program		Approximate Dollar Value of Shares that May Yet Be Purchased
July 1, 2012 to July 28, 2012		—		—		—	$	102,050,526
July 29, 2012 to August 25, 2012		10,000		78.22		10,000		101,268,318
August 26, 2012 to September 29, 2012		67,500		78.34		67,500		95,980,608

Total		77,500	$	78.32		77,500	$	95,980,608

Item 4.

MINE SAFETY DISCLOSURES

Not Applicable

Item 6.

EXHIBITS

The following exhibits are being filed with this report:



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*		XBRL Taxonomy Extension Schema Document.

101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document.

Users of this data are advised pursuant to Rule 406T of Regulation S-T that this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities and Exchange Act of 1934, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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/ ALVARO GARCIA-TUNON
		Alvaro Garcia-Tunon,
		Executive Vice President,
		Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)

DATE: November 2, 2012

EXHIBIT INDEX



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*		XBRL Taxonomy Extension Schema Document.

101.CAL*		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*		XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*		XBRL Taxonomy Extension Presentation Linkbase Document.

Exhibit 31.1

CERTIFICATION

I, Albert J. Neupaver, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Westinghouse Air Brake Technologies Corporation.

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this quarterly report based on such evaluation; and

(d) Disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 2, 2012


By:		/s/ ALBERT J. NEUPAVER
Name:		Albert J. Neupaver
Title:		President, Chief Executive Officer and Director

Exhibit 31.2

CERTIFICATION

I, Alvaro Garcia-Tunon, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Westinghouse Air Brake Technologies Corporation.

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 2, 2012


By:		/s/ ALVARO GARCIA-TUNON
Name:		Alvaro Garcia-Tunon
Title:		Executive Vice President, Chief Financial Officer

Exhibit 32.1

CERTIFICATION

Pursuant to 18 U.S.C. § 1350, the undersigned officers of Westinghouse Air Brake Technologies Corporation (the “Company”), hereby certify, to the best of their knowledge, that the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2012 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


By:		/S/ ALBERT J. NEUPAVER
		Albert J. Neupaver
		President, Chief Executive Officer and Director
Date: November 2, 2012

By:		/S/ ALVARO GARCIA-TUNON
		Alvaro Garcia-Tunon, Executive Vice President, Chief Financial Officer

Date: November 2, 2012

v2.4.0.6

Accounting Policies - Additional Information (Detail) (USD $)
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Dec. 31, 2011

Fair Value, Option, Quantitative Disclosures [Line Items]

Unbilled accounts receivables $ 92,500,000 $ 92,500,000 $ 58,900,000

Customer deposits 104,400,000 104,400,000 72,800,000

Provisions for loss contracts 9,900,000 9,900,000 9,300,000

Deferred pre-production costs 16,400,000 16,400,000 15,400,000

Interest rate swap agreements, notional amount 107,000,000 107,000,000

Fixed interest rate on bank debt 1.82% 1.82%

Interest rate swap agreement termination date Dec. 31, 2012

Interest rate swap, accumulated other comprehensive loss 300,000 300,000

Interest rate on notional value 1.415%

Foreign exchange transaction gains (losses) recognized in other income (expense) (1,468,000) (1,795,000) (427,000) (2,061,000)

Forward starting interest rate swap agreement [Member]

Fair Value, Option, Quantitative Disclosures [Line Items]

Interest rate swap agreements, notional amount 150,000,000 150,000,000

Interest rate swap agreement termination date Nov. 07, 2016

Current liability 4,100,000 4,100,000

Interest rate swap, accumulated other comprehensive loss 2,500,000 2,500,000

Interest rate swap agreement [Member]

Fair Value, Option, Quantitative Disclosures [Line Items]

Current liability $ 400,000 $ 400,000

v2.4.0.6

Employee Benefit Plans - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
9 Months Ended

Sep. 30, 2012

United States Postretirement Benefit Plans [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Contribution to the plan $ 1.6

International Postretirement Benefit Plans [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Contribution to the plan $ 6.4

v2.4.0.6

Intangible Assets Other Than Goodwill and Trademarks (Parenthetical) (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Patents And Other [Member]

Finite-Lived Intangible Assets [Line Items]

Intangible assets, accumulated amortization $ 34,650 $ 32,316

Customer Relationships [Member]

Finite-Lived Intangible Assets [Line Items]

Intangible assets, accumulated amortization $ 28,509 $ 21,295

v2.4.0.6

Components of Other Income Expense (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Component of Other Income, Nonoperating [Line Items]

Foreign currency loss $ (1,468) $ (1,795) $ (427) $ (2,061)

Other miscellaneous (expense) income 75 266 (857) 582

Total other income (expense), net $ (1,393) $ (1,529) $ (1,284) $ (1,479)

v2.4.0.6

Changes in Carrying Amount of Goodwill (Detail) (USD $)
In Thousands, unless otherwise specified
9 Months Ended

Sep. 30, 2012

Goodwill [Line Items]

Balance at December 31, 2011 $ 587,531

Acquisition 61,559

Adjustment to preliminary purchase allocation 3,908

Foreign currency impact 3,935

Balance at September 30, 2012 656,933

Freight Segment [Member]

Goodwill [Line Items]

Balance at December 31, 2011 388,221

Acquisition 4,781

Adjustment to preliminary purchase allocation 2,754

Foreign currency impact 2,116

Balance at September 30, 2012 397,872

Transit Segment [Member]

Goodwill [Line Items]

Balance at December 31, 2011 199,310

Acquisition 56,778

Adjustment to preliminary purchase allocation 1,154

Foreign currency impact 1,819

Balance at September 30, 2012 $ 259,061

v2.4.0.6

WARRANTIES (Tables)
9 Months Ended

Sep. 30, 2012

WARRANTIES

The following table reconciles the changes in the Company’s product warranty reserve as follows:

   Nine Months Ended
September 30,

In thousands
   2012 2011

Balance at December 31, 2011 and 2010, respectively
   $ 50,640    $ 35,513

Warranty expense
   18,334    12,602

Acquisitions
   494    12,008

Warranty claim payments
   (11,971 ) (12,921 )



Balance at September 30, 2012 and 2011, respectively
   $ 57,497    $ 47,202

v2.4.0.6

Fair Value of Each Option Grant Weighted Average Assumptions (Detail)
9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]

Dividend yield 0.23% 0.08%

Risk-free interest rate 1.35% 2.96%

Stock price volatility 44.95% 45.60%

Expected life (years) 5 years 5 years

v2.4.0.6

ACCOUNTING POLICIES (Tables)
9 Months Ended

Sep. 30, 2012

Schedule of Accumulated other Comprehensive Loss

The components of accumulated other comprehensive loss were:

In thousands
   September 30,
2012 December 31,
2011

Foreign currency translation gain (loss)
   $ 3,851    $ (2,447 )

Unrealized loss on interest rate swap contracts, net of tax
   (2,722 ) (871 )

Pension benefit plans and post retirement benefit plans, net of tax
   (56,209 ) (57,579 )



Total accumulated comprehensive loss
   $ (55,080 ) $ (60,897 )

v2.4.0.6

Long Term Debt (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Debt Instrument [Line Items]

Long-term debt $ 432,897 $ 395,873

Less-current portion 43 68

Long-term portion 432,854 395,805

6.875% Senior Notes, Due 2013 [Member]

Debt Instrument [Line Items]

Long-term debt 150,000 150,000

Revolving Credit Facility [Member]

Debt Instrument [Line Items]

Long-term debt 282,000 245,000

Capital Lease Obligations [Member]

Debt Instrument [Line Items]

Long-term debt $ 897 $ 873

v2.4.0.6

Summary of Fair Value of Assets Acquired and Liabilities Assumed (Detail) (USD $)
In Thousands, unless otherwise specified

Feb. 25, 2011

Brush Traction [Member]

Jun. 29, 2011

ATP [Member]

Nov. 03, 2011

Bearward [Member]

Nov. 18, 2011

Fulmer [Member]

Jun. 14, 2012

Mors Smitt [Member]

Jul. 13, 2012

Tec Tran [Member]

Jul. 31, 2012

Winco [Member]

Indefinite-lived Intangible Assets [Line Items]

Current assets $ 19,558 $ 14,777 $ 4,203 $ 23,787 $ 1,955 $ 1,584

Property, plant & equipment 8,862 4,498 1,636 6,960 116 47

Goodwill and other intangible assets 30,816 21,100 43,990 8,409 85,354 6,811 7,401

Other assets 53 944

Total assets acquired 59,236 21,100 63,318 14,248 117,045 8,882 9,032

Total liabilities assumed (28,559) (19,532) (657) (27,057) (382) (5,376)

Net assets acquired $ 30,677 $ 21,100 $ 43,786 $ 13,591 $ 89,988 $ 8,500 $ 3,656

v2.4.0.6

OTHER INCOME (EXPENSE), NET (Tables)
9 Months Ended

Sep. 30, 2012

Components of Other Income (Expense)

The components of other income (expense) are as follows:

   Three Months Ended
September 30, Nine Months Ended
September 30,

In thousands
   2012 2011 2012 2011

Foreign currency loss
   $ (1,468 ) $ (1,795 ) $ (427 ) $ (2,061 )

Other miscellaneous income (expense)
   75 266    (857 )   582



Total other income (expense) income, net
   $ (1,393 ) $ (1,529 ) $ (1,284 ) $ (1,479 )

v2.4.0.6

Guarantor Subsidiaries Balance Sheet (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Sep. 30, 2011

Dec. 31, 2010

Condensed Financial Statements, Captions [Line Items]

Cash and cash equivalents $ 282,055 $ 285,615 $ 221,136 $ 236,941

Accounts receivable 430,230 346,281

Inventories 391,592 348,174

Other current assets 80,172 75,712

Total current assets 1,184,049 1,055,782

Property, plant and equipment 229,147 222,022

Goodwill 656,933 587,531

Other intangibles 284,889 257,355

Other long term assets 41,024 36,263

Total Assets 2,396,042 2,158,953

Current liabilities 540,692 541,385

Long-term debt 432,854 395,805

Other long term liabilities 191,479 174,119

Total liabilities 1,165,025 1,111,309

Stockholders' equity 1,231,017 1,047,644

Total Liabilities and Shareholders' Equity 2,396,042 2,158,953

Parent Company [Member]

Condensed Financial Statements, Captions [Line Items]

Cash and cash equivalents 76,210 75,621 14,231 42,714

Accounts receivable 75 186

Other current assets 62,889 59,990

Total current assets 139,174 135,797

Property, plant and equipment 4,243 3,655

Goodwill 7,980 7,980

Investment in subsidiaries 3,070,357 2,675,378

Other long term assets (10,340) (9,946)

Total Assets 3,211,414 2,812,864

Current liabilities 48,977 72,396

Inter-company 1,427,896 1,222,650

Long-term debt 432,000 395,000

Other long term liabilities 71,524 75,174

Total liabilities 1,980,397 1,765,220

Stockholders' equity 1,231,017 1,047,644

Total Liabilities and Shareholders' Equity 3,211,414 2,812,864

Guarantor Subsidiaries [Member]

Condensed Financial Statements, Captions [Line Items]

Cash and cash equivalents 5,622 14,024 8,965 13,226

Accounts receivable 243,220 196,909

Inventories 270,873 250,280

Other current assets 6,500 5,989

Total current assets 526,215 467,202

Property, plant and equipment 125,031 123,182

Goodwill 407,324 399,419

Investment in subsidiaries 193,978 183,357

Other intangibles 166,620 174,351

Other long term assets 3,377 5,640

Total Assets 1,422,545 1,353,151

Current liabilities 326,916 282,671

Inter-company (1,588,017) (1,303,441)

Long-term debt 175 198

Other long term liabilities 31,658 33,790

Total liabilities (1,229,268) (986,782)

Stockholders' equity 2,651,813 2,339,933

Total Liabilities and Shareholders' Equity 1,422,545 1,353,151

Non-Guarantor Subsidiaries [Member]

Condensed Financial Statements, Captions [Line Items]

Cash and cash equivalents 200,223 195,970 197,940 181,001

Accounts receivable 186,935 149,186

Inventories 120,719 97,894

Other current assets 10,783 9,733

Total current assets 518,660 452,783

Property, plant and equipment 99,873 95,185

Goodwill 241,629 180,132

Other intangibles 118,269 83,004

Other long term assets 47,987 40,569

Total Assets 1,026,418 851,673

Current liabilities 164,799 186,318

Inter-company 160,121 80,791

Long-term debt 679 607

Other long term liabilities 88,297 65,155

Total liabilities 413,896 332,871

Stockholders' equity 612,522 518,802

Total Liabilities and Shareholders' Equity 1,026,418 851,673

Elimination [Member]

Condensed Financial Statements, Captions [Line Items]

Investment in subsidiaries (3,264,335) (2,858,735)

Total Assets (3,264,335) (2,858,735)

Stockholders' equity (3,264,335) (2,858,735)

Total Liabilities and Shareholders' Equity $ (3,264,335) $ (2,858,735)

v2.4.0.6

Computation of Basic and Diluted Earnings Per Share (Parenthetical) (Detail)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Earnings Per Share Basic And Diluted By Common Class [Line Items]

Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest 47,874 48,123 47,977 48,064

v2.4.0.6

Intangible Assets Other Than Goodwill and Trademarks (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Finite-Lived Intangible Assets [Line Items]

Accumulated amortization $ 158,772 $ 142,809

Patents And Other [Member]

Finite-Lived Intangible Assets [Line Items]

Accumulated amortization 11,799 14,849

Customer Relationships [Member]

Finite-Lived Intangible Assets [Line Items]

Accumulated amortization $ 146,973 $ 127,960

v2.4.0.6

ACCOUNTING POLICIES
9 Months Ended

Sep. 30, 2012

ACCOUNTING POLICIES

2. ACCOUNTING POLICIES

Basis of Presentation The unaudited condensed consolidated interim financial statements have been prepared in accordance with generally accepted accounting principles and the rules and regulations of the Securities and Exchange Commission and include the accounts of Wabtec and its majority owned subsidiaries. These condensed consolidated interim financial statements do not include all of the information and footnotes required for complete financial statements. In Management’s opinion, these financial statements reflect all adjustments of a normal, recurring nature necessary for a fair presentation of the results for the interim periods presented. Results for these interim periods are not necessarily indicative of results to be expected for the full year.

The Company operates on a four-four-five week accounting quarter, and the quarters end on or about March 31, June 30, September 30 and December 31.

The notes included herein should be read in conjunction with the audited consolidated financial statements included in Wabtec’s Annual Report on Form 10-K for the year ended December 31, 2011. The December 31, 2011 information has been derived from the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

                 Reclassifications Certain prior year amounts have been reclassified where necessary to conform to the current year presentation.

Revenue Recognition Revenue is recognized in accordance with Accounting Standards Codification (“ASC”) 605 “Revenue Recognition”. Revenue is recognized when products have been shipped to the respective customers, title has passed and the price for the product has been determined.

In general, the Company recognizes revenues on long-term contracts based on the percentage of completion method of accounting. The units-of-delivery method or other input-based or output-based measures, as appropriate, are used to measure the progress toward completion of individual contracts. Contract revenues and cost estimates are reviewed and revised at a minimum quarterly and adjustments are reflected in the accounting period as such amounts are determined. Provisions are made currently for estimated losses on uncompleted contracts. Unbilled accounts receivables were $92.5 million and $58.9, customer deposits were $104.4 million and $72.8, and provisions for loss contracts were $9.9 million and $9.3 million at September 30, 2012 and December 31, 2011, respectively.

Certain pre-production costs relating to long-term production and supply contracts have been deferred and will be recognized over the life of the contracts. Deferred pre-production costs were $16.4 million and $15.4 million at September 30, 2012 and December 31, 2011, respectively.

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates. On an ongoing basis, management reviews its estimates based on currently available information. Changes in facts and circumstances may result in revised estimates.

Stock-Based Compensation The Company recognizes compensation expense for stock-based compensation based on the grant date fair value amortized ratably over the requisite service period following the date of grant.

Financial Derivatives and Hedging Activities The Company has periodically entered into foreign currency forward contracts to reduce the impact of changes in currency exchange rates. Forward contracts are agreements with a counter-party to exchange two distinct currencies at a set exchange rate for delivery on a set date at some point in the future. There is no exchange of funds until the delivery date. At the delivery date the Company can either take delivery of the currency or settle on a net basis. At September 30, 2012, the Company had no forward contracts.

To reduce the impact of interest rate changes on a portion of its variable-rate debt, the Company entered into interest rate swaps which effectively converted a portion of the debt from variable to fixed-rate borrowings during the term of the swap contracts. The Company is exposed to credit risk in the event of nonperformance by the counterparties. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparties are large financial institutions with excellent credit ratings and history of performance. The Company currently believes the risk of nonperformance is negligible. The Company concluded that these interest rate swap agreements qualify for cash flow hedge accounting which permits the recording of the fair value of the interest rate swap agreements and corresponding adjustment to other comprehensive income (loss), net of tax, on the balance sheet.

Effective September 30, 2012, the Company had interest rate swap agreements with a notional amount of $107.0 million and which effectively changed the Company’s interest rate on bank debt at September 30, 2012 from a variable rate to a fixed rate of 1.82%. The interest rate swap agreements mature on December 31, 2012. As of September 30, 2012, the Company has recorded a current liability of $0.4 million and a corresponding offset in accumulated other comprehensive loss of $0.3 million, net of tax, related to these agreements. Also, the Company entered into a forward starting interest rate swap agreement with a notional value of $150.0 million. Effective July 31, 2013, with a termination date of November 7, 2016, this interest rate swap agreement will convert a portion of the Company’s then outstanding debt from a variable rate to a fixed-rate borrowing. During the term of the interest rate swap agreement the interest rate on the notional value will be fixed at 1.415% plus the Alternate Rate margin. As of September 30, 2012, the Company has recorded a current liability of $4.1 million and a corresponding offset in accumulated other comprehensive loss of $2.5 million, net of tax, related to this agreement.

Foreign Currency Translation Assets and liabilities of foreign subsidiaries, except for the Company’s Mexican operations whose functional currency is the U.S. Dollar, are translated at the rate of exchange in effect on the balance sheet date while income and expenses are translated at the average rates of exchange prevailing during the year. Foreign currency gains and losses resulting from transactions, and the translation of financial statements are recorded in the Company’s consolidated financial statements based upon the provisions of ASC 830 “Foreign Currency Matters.” The effects of currency exchange rate changes on intercompany transactions and balances of a long-term investment nature are accumulated and carried as a component of accumulated other comprehensive loss. The effects of currency exchange rate changes on intercompany transactions that are denominated in a currency other than an entity’s functional currency are charged or credited to earnings. Foreign exchange transaction losses recognized in other income (expense), net were $1.4 million and $1.8 million for the three months ended September 30, 2012 and 2011, respectively. Foreign exchange transaction losses recognized in other income (expense), net were $0.4 million and $2.1 million for the nine months ended September 30, 2012 and 2011, respectively.

Non-controlling Interests In accordance with ASC 810, the Company has classified non-controlling interests as equity on our condensed consolidated balance sheets as of September 30, 2012 and December 31, 2011. Net income attributable to non-controlling interests for the three and nine months ended September 30, 2012 and 2011 was not material.

Other Comprehensive Income Comprehensive income is defined as net income and all other non-owner changes in shareholders’ equity.

The components of accumulated other comprehensive loss were:

In thousands
   September 30,
2012 December 31,
2011

Foreign currency translation gain (loss)
   $ 3,851    $ (2,447 )

Unrealized loss on interest rate swap contracts, net of tax
   (2,722 ) (871 )

Pension benefit plans and post retirement benefit plans, net of tax
   (56,209 ) (57,579 )



Total accumulated comprehensive loss
   $ (55,080 ) $ (60,897 )

v2.4.0.6

Changes in Product Warranty Reserve (Detail) (USD $)
In Thousands, unless otherwise specified
9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Warranties [Line Items]

Balance $ 50,640 $ 35,513

Warranty expense 18,334 12,602

Acquisitions 494 12,008

Warranty claim payments (11,971) (12,921)

Balance $ 57,497 $ 47,202

v2.4.0.6

Pro Forma Financial Information (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Business Acquisition [Line Items]

Net sales $ 588,939 $ 546,413 $ 1,820,046 $ 1,574,359

Gross profit 171,818 163,340 529,695 469,767

Net income attributable to Wabtec shareholders $ 63,263 $ 53,278 $ 188,655 $ 139,987

Diluted earnings per share, As reported $ 1.30 $ 0.96 $ 3.85 $ 2.56

Diluted earnings per share, Pro forma $ 1.31 $ 1.10 $ 3.90 $ 2.90

v2.4.0.6

LONG-TERM DEBT (Tables)
9 Months Ended

Sep. 30, 2012

Long-Term Debt

Long-term debt consisted of the following:

In thousands
   September 30,
2012    December 31,
2011

6.875% Senior Notes, due 2013
   $ 150,000       $ 150,000

Revolving Credit Facility
   282,000       245,000

Capital Leases
   897       873





Total
   432,897       395,873

Less—current portion
   43       68





Long-term portion
   $ 432,854       $ 395,805

v2.4.0.6

INTANGIBLES (Tables)
9 Months Ended

Sep. 30, 2012

Change in the Carrying Amount of Goodwill

December 31, 2011, respectively. The change in the carrying amount of goodwill by segment for the nine months ended September 30, 2012 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Total

Balance at December 31, 2011
   $ 388,221       $ 199,310       $ 587,531

Acquisition
   4,781       56,778       61,559

Adjustment to preliminary purchase allocation
   2,754       1,154       3,908

Foreign currency impact
   2,116       1,819       3,935







Balance at September 30, 2012
   $ 397,872       $ 259,061       $ 656,933







Intangible Assets other than Goodwill and Trademarks

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

In thousands
   September 30,
2012    December 31,
2011

Patents and other, net of accumulated amortization of $34,650 and $32,316
   $ 11,799       $ 14,849

Customer relationships, net of accumulated amortization of $28,509 and $21,295
   146,973       127,960





Total
   $ 158,772       $ 142,809





Amortization Expense

Amortization expense for the five succeeding years is as follows (in thousands):

Remainder of 2012
   $
4,521


2013

13,467


2014
   12,630

2015
   11,872

2016
   11,715

v2.4.0.6

Stock Option Activity (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended 12 Months Ended

Sep. 30, 2012

Y

Sep. 30, 2012

Y

Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]

Weighted Average Remaining Contractual Life, Outstanding 6 years 4 months 24 days 6 years 6 months

Weighted Average Remaining Contractual Life, Exercisable

Aggregate intrinsic value, Outstanding, beginning of period $ 30,362

Aggregate intrinsic value, Granted 725

Aggregate intrinsic value, Exercised (7,079)

Aggregate intrinsic value, Canceled (1,224) (1,224)

Aggregate intrinsic value, Outstanding, end of period 31,701 31,701

Aggregate intrinsic value, Exercisable $ 23,592 $ 23,592

Weighted Average Exercise Price, Outstanding, beginning of period $ 34.74

Weighted Average Exercise Price, Granted $ 70.71

Weighted Average Exercise Price, Exercised $ 24.01

Weighted Average Exercise Price, Canceled $ 34.46

Weighted Average Exercise Price, Outstanding, end of period $ 39.94 $ 39.94

Weighted Average Exercise Price, Exercisable $ 32.95 $ 32.95

Options, Outstanding, beginning of period 862,392

Options, Granted 75,698

Options, Exercised (125,788)

Options, Canceled (26,717)

Options, Outstanding, end of period 785,585 785,585

Options, Exercisable 498,381 498,381

v2.4.0.6

Components of Inventory Net of Reserves (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Inventory [Line Items]

Raw materials $ 165,139 $ 154,885

Work-in-process 135,152 110,179

Finished goods 91,301 83,110

Total inventories $ 391,592 $ 348,174

v2.4.0.6

EMPLOYEE BENEFIT PLANS (Tables)
9 Months Ended

Sep. 30, 2012

Defined Benefit Pension Plans

The following tables provide information regarding the Company’s defined benefit pension plans summarized by U.S. and international components.

   U.S. International

   Three months ended
September 30, Three months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ 94    $ 84    $ 493    $ 805

Interest cost
   501    582    1,773    1,886

Expected return on plan assets
   (771 ) (796 ) (2,035 ) (2,124 )

Net amortization/deferrals
   659    710    681    533

Settlement loss recognized
   —      —      844    132



Net periodic benefit cost
   $ 483    $ 580    $ 1,756    $ 1,232



Assumptions


Discount rate
   4.30 % 5.20 % 4.96 % 5.43 %

Expected long-term rate of return
   7.50 % 8.00 % 6.12 % 6.72 %

Rate of compensation increase
   3.00 % 3.00 % 3.21 % 3.17 %

   U.S. International

   Nine months ended
September 30, Nine months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ 285    $ 232    $ 1,479    $ 2,427

Interest cost
   1,585    1,820    5,309    5,735

Expected return on plan assets
   (2,321 ) (2,498 ) (6,085 ) (6,418 )

Net amortization/deferrals
   2,272    1,923    2,032    1,551

Settlement loss recognized
   —      —      1,137    720



Net periodic benefit cost
   $ 1,821    $ 1,477    $ 3,872    $ 4,015



Assumptions


Discount rate
   4.30 % 5.20 % 4.96 % 5.43 %

Expected long-term rate of return
   7.50 % 8.00 % 6.12 % 6.72 %

Rate of compensation increase
   3.00 % 3.00 % 3.21 % 3.17 %

Post Retirement Benefit Plans

The following tables provide information regarding the Company’s post retirement benefit plans summarized by U.S. and international components.

   U.S. International

   Three months ended
September 30, Three months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ (1 ) $ 4    $ 11    $ 14

Interest cost
   339    410    51    58

Net amortization/deferrals
   (212 ) (186 ) (83 ) (97 )



Net periodic benefit cost
   $ 126    $ 228    $ (21 ) $ (25 )



Assumptions


Discount rate
   4.30 % 5.20 % 5.15 % 5.50 %

   U.S. International

   Nine months ended
September 30, Nine months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ 18    $ 24    $ 33    $ 42

Interest cost
   1,040    1,208    151    175

Net amortization/deferrals
   (613 ) (675 ) (247 ) (292 )



Net periodic benefit cost
   $ 445    $ 557    $ (63 ) $ (75 )



Assumptions


Discount rate
   4.30 % 5.20 % 5.15 % 5.50 %

v2.4.0.6

STOCK-BASED COMPENSATION (Tables)
9 Months Ended

Sep. 30, 2012

Stock Option Activity

The following table summarizes the Company’s stock option activity and related information for the 2011 Plan, the 2000 Plan and the Directors Plan for the nine months ended September 30, 2012:

   Options Weighted
Average
Exercise
Price    Weighted Average
Remaining
Contractual Life    Aggregate
intrinsic value
(in thousands)

Outstanding at December 31, 2011
   862,392    $ 34.74       6.5       $ 30,362

Granted
   75,698    70.71          725

Exercised
   (125,788 ) 24.01          (7,079 )

Canceled
   (26,717 ) 34.46          (1,224 )







Outstanding at September 30, 2012
   785,585    $ 39.94       6.4       $ 31,701







Exercisable at September 30, 2012
   498,381    $ 32.95       6.2       $ 23,592

Schedule of Share-based Fair Value of Each Option Grant Weighted-Average Assumptions

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

   Nine months ended
September 30,

   2012 2011

Dividend yield
   .23 % .08 %

Risk-free interest rate
   1.35 % 2.96 %

Stock price volatility
   44.95 % 45.6 %

Expected life (years)
   5.0    5.0

Restricted Stock Activity and Incentive Stock Awards Activity

The following table summarizes the restricted stock and unit activity for the 2011 Plan, the 2000 Plan and the Directors Plan, and incentive stock awards activity for the 2011 Plan and the 2000 Plan with related information for the nine months ended September 30, 2012:

   Restricted
Stock
and Units Incentive
Stock
Awards Weighted
Average Grant
Date Fair
Value

Outstanding at December 31, 2011
   274,609    646,362    $ 44.04

Granted
   110,980    118,660    70.85

Vested
   (98,694 ) (122,079 ) 35.73

Adjustment for incentive stock awards expected to vest
   —      45,784    60.61

Canceled
   (13,008 ) (2,219 ) 42.96



Outstanding at September 30, 2012
   273,887    686,508    $ 53.17

v2.4.0.6

BUSINESS
9 Months Ended

Sep. 30, 2012

BUSINESS

1. BUSINESS

Wabtec is one of the world’s largest providers of value-added, technology-based products and services for the global rail industry. Our products are found on virtually all U.S. locomotives, freight cars and passenger transit vehicles, as well as in more than 100 countries throughout the world. Our products enhance safety, improve productivity and reduce maintenance costs for customers, and many of 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 20 countries. In the first nine months of 2012, about 50% of the Company’s revenues came from customers outside the U.S.

v2.4.0.6

EARNINGS PER SHARE (Tables)
9 Months Ended

Sep. 30, 2012

Basic and Diluted 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,

In thousands, except per share
   2012 2011

Numerator


Numerator for basic and diluted earnings per common share—net income attributable to Wabtec shareholders
   $ 62,994    $ 46,600

Less: dividends declared—common shares and non-vested restricted stock
   (2,376 ) (1,442 )



Undistributed earnings
   60,618    45,158

Percentage allocated to common shareholders(1)
   99.5 % 99.5 %



   60,315    44,932

Add: dividends declared—common shares
   2,364    1,435



Numerator for basic and diluted earnings per common share
   $ 62,679    $ 46,367



Denominator


Denominator for basic earnings per common share—weighted-average shares
   47,643    47,874

Effect of dilutive securities:


Assumed conversion of dilutive stock-based compensation plans
   628    492



Denominator for diluted earnings per common share—adjusted weighted-average shares and assumed conversion
   48,271    48,366



Net income per common share attributable to Wabtec shareholders


Basic
   $ 1.32    $ 0.97

Diluted
   $ 1.30    $ 0.96

(1) Basic weighted-average common shares outstanding
   47,643    47,874

Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest
   47,874    48,123

Percentage allocated to common shareholders
   99.5 % 99.5 %

   Nine Months Ended
September 30,

In thousands, except per share
   2012 2011

Numerator


Numerator for basic and diluted earnings per common share—net income attributable to Wabtec shareholders
   $ 186,967    $ 123,886

Less: dividends declared—common shares and non-vested restricted stock
   (5,256 ) (2,407 )



Undistributed earnings
   181,711    121,479

Percentage allocated to common shareholders(1)
   99.5 % 99.5 %



   180,802    120,872

Add: dividends declared—common shares
   5,229    2,395



Numerator for basic and diluted earnings per common share
   $ 186,031    $ 123,267



Denominator


Denominator for basic earnings per common share—weighted-average shares
   47,732    47,827

Effect of dilutive securities:


Assumed conversion of dilutive stock-based compensation plans
   628    500



Denominator for diluted earnings per common share—adjusted weighted-average shares and assumed conversion
   48,360    48,327



Net income per common share attributable to Wabtec shareholders


Basic
   $ 3.90    $ 2.58

Diluted
   $ 3.85    $ 2.56

(1) Basic weighted-average common shares outstanding
   47,732    47,827

Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest
   47,977    48,064

Percentage allocated to common shareholders
   99.5 % 99.5 %

v2.4.0.6

Components of Accumulated Other Comprehensive Loss (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Accumulated Other Comprehensive Income Loss [Line Items]

Foreign currency translation gain (loss) $ 3,851 $ (2,447)

Unrealized loss on interest rate swap contracts, net of tax (2,722) (871)

Pension benefit plans and post retirement benefit plans, net of tax (56,209) (57,579)

Total accumulated comprehensive loss $ (55,080) $ (60,897)

v2.4.0.6

Post Retirement Benefit Plans (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

United States Postretirement Benefit Plans

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Service cost $ (1) $ 4 $ 18 $ 24

Interest cost 339 410 1,040 1,208

Net amortization/deferrals (212) (186) (613) (675)

Net periodic benefit cost 126 228 445 557

Discount rate 4.30% 5.20% 4.30% 5.20%

International Postretirement Benefit Plans

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Service cost 11 14 33 42

Interest cost 51 58 151 175

Net amortization/deferrals (83) (97) (247) (292)

Net periodic benefit cost (21) (25) (63) (75)

Discount rate 5.15% 5.50% 5.15% 5.50%

United States Postretirement Benefit Plans [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Service cost 94 84 285 232

Interest cost 501 582 1,585 1,820

Expected return on plan assets (771) (796) (2,321) (2,498)

Net amortization/deferrals 659 710 2,272 1,923

Net periodic benefit cost 483 580 1,821 1,477

Discount rate 4.30% 5.20% 4.30% 5.20%

Expected long-term rate of return 7.50% 8.00% 7.50% 8.00%

Rate of compensation increase 3.00% 3.00% 3.00% 3.00%

International Postretirement Benefit Plans [Member]

Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]

Service cost 493 805 1,479 2,427

Interest cost 1,773 1,886 5,309 5,735

Expected return on plan assets (2,035) (2,124) (6,085) (6,418)

Net amortization/deferrals 681 533 2,032 1,551

Settlement loss recognized 844 132 1,137 720

Net periodic benefit cost $ 1,756 $ 1,232 $ 3,872 $ 4,015

Discount rate 4.96% 5.43% 4.96% 5.43%

Expected long-term rate of return 6.12% 6.72% 6.12% 6.72%

Rate of compensation increase 3.21% 3.17% 3.21% 3.17%

v2.4.0.6

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Current Assets

Cash and cash equivalents $ 282,055 $ 285,615

Accounts receivable 430,230 346,281

Inventories 391,592 348,174

Deferred income taxes 58,592 57,339

Other 21,580 18,373

Total current assets 1,184,049 1,055,782

Property, plant and equipment 534,687 513,113

Accumulated depreciation (305,540) (291,091)

Property, plant and equipment, net 229,147 222,022

Other Assets

Goodwill 656,933 587,531

Other intangibles, net 284,889 257,355

Other noncurrent assets 41,024 36,263

Total other assets 982,846 881,149

Total Assets 2,396,042 2,158,953

Current Liabilities

Accounts payable 235,568 244,649

Customer deposits 104,404 72,811

Accrued compensation 49,443 48,564

Accrued warranty 38,555 29,416

Current portion of long-term debt 43 68

Other accrued liabilities 112,679 145,877

Total current liabilities 540,692 541,385

Long-term debt 432,854 395,805

Accrued postretirement and pension benefits 59,855 63,837

Deferred income taxes 91,281 74,217

Accrued warranty 18,942 21,224

Other long-term liabilities 21,401 14,841

Total liabilities 1,165,025 1,111,309

Shareholders' Equity

Preferred stock, 1,000,000 shares authorized, no shares issued

Common stock, $.01 par value; 100,000,000 shares authorized: 66,174,767 shares issued and 47,887,204 and 47,946,360 outstanding at September 30, 2012 and December 31, 2011, respectively 662 662

Additional paid-in capital 375,975 360,914

Treasury stock, at cost, 18,287,563 and 18,228,407 shares, at September 30, 2012 and December 31, 2011, respectively (331,708) (309,196)

Retained earnings 1,235,417 1,053,706

Accumulated other comprehensive loss (55,080) (60,897)

Total Westinghouse Air Brake Technologies Corporation shareholders' equity 1,225,266 1,045,189

Non-controlling interest 5,751 2,455

Total shareholders' equity 1,231,017 1,047,644

Total Liabilities and Shareholders' Equity $ 2,396,042 $ 2,158,953

v2.4.0.6

Intangibles - Additional Information (Detail) (USD $)
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Dec. 31, 2011

Intangible Assets Disclosure [Line Items]

Goodwill $ 656,933,000 $ 656,933,000 $ 587,531,000

Trademarks 126,100,000 126,100,000 114,600,000

Intangible assets, amortization expense $ 3,900,000 $ 4,100,000 $ 10,300,000 $ 10,500,000

Patents [Member]

Intangible Assets Disclosure [Line Items]

Intangible assets, weighted average useful life, (years) 5 years

Customer Relationships [Member]

Intangible Assets Disclosure [Line Items]

Intangible assets, weighted average useful life, (years) 19 years

Intellectual Property Rights [Member]

Intangible Assets Disclosure [Line Items]

Intangible assets, weighted average useful life, (years) 17 years

v2.4.0.6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands, unless otherwise specified
9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Operating Activities

Net income attributable to Wabtec shareholders $ 186,967 $ 123,886

Adjustments to reconcile net income to net cash provided by operations:

Depreciation and amortization 31,488 33,678

Stock-based compensation expense 15,007 13,222

Loss on disposal of property, plant and equipment 674 689

Excess income tax benefits from exercise of stock options (2,518) (3,689)

Changes in operating assets and liabilities, net of acquisitions

Accounts receivable (71,430) (80,285)

Inventories (26,599) (63,389)

Accounts payable (18,569) 3,696

Accrued income taxes (17,378) 4,257

Accrued liabilities and customer deposits 37,700 80,848

Other assets and liabilities (21,817) (12,893)

Net cash provided by operating activities 113,525 100,020

Investing Activities

Purchase of property, plant and equipment (24,694) (22,226)

Proceeds from disposal of property, plant and equipment 931 300

Acquisitions of business, net of cash acquired (102,144) (51,777)

Acquisition purchase price adjustment (160) 40

Net cash used for investing activities (126,067) (73,663)

Financing Activities

Proceeds from debt 211,000 124,000

Payments of debt (173,992) (139,920)

Proceeds from exercise of stock options and other benefit plans 3,021 4,577

Stock repurchase (27,997) (23,803)

Excess income tax benefits from exercise of stock options 2,518 3,689

Cash dividends ($0.11 and $0.05 per share for the nine months ended September 30, 2012 and 2011, respectively) (5,256) (2,407)

Net cash provided by (used for) financing activities 9,294 (33,864)

Effect of changes in currency exchange rates (312) (8,298)

Decrease in cash (3,560) (15,805)

Cash, beginning of year 285,615 236,941

Cash, end of period $ 282,055 $ 221,136

v2.4.0.6

Income Taxes - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Dec. 31, 2011

Income Tax Contingency [Line Items]

Effective income tax rate 31.80% 33.60% 33.30% 33.20%

Liability for income taxes $ 9.7 $ 9.7 $ 8.2

Unrecognized tax benefits if recognized that would affect effective tax rate 3.9 3.9 2.1

Accrued interest 2.6 2.6 2.8

Accrued Penalties 1.4 1.4 1.5

Unrecognized tax benefits $ 1.1 $ 1.1

v2.4.0.6

SEGMENT INFORMATION (Tables)
9 Months Ended

Sep. 30, 2012

Segment Financial Information

Segment financial information for the three months ended September 30, 2012 is as follows:

In thousands
   Freight
Segment    Transit
Segment Corporate
Activities and
Elimination Total

Sales to external customers
   $ 354,659       $ 232,934    $ —      $ 587,593

Intersegment sales/(elimination)
   5,662       3,231 (8,893 ) —





Total sales
   $ 360,321       $ 236,165    $ (8,893 ) $ 587,593





Income (loss) from operations
   $ 75,702       $ 24,385    $ (3,245 ) $ 96,842

Interest expense and other, net
   —         —      (4,463 ) (4,463 )





Income (loss) from operations before income taxes
   $ 75,702       $ 24,385    $ (7,708 ) $ 92,379





Segment financial information for the three months ended September 30, 2011 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Corporate
Activities and
Elimination Total

Sales to external customers
   $ 315,837       $ 183,003       $ —      $ 498,840

Intersegment sales/(elimination)
   4,626       2,955       (7,581 ) —







Total sales
   $ 320,463       $ 185,958       $ (7,581 ) $ 498,840







Income (loss) from operations
   $ 60,709       $ 20,803       $ (6,059 ) $ 75,453

Interest expense and other, net
   —         —         (5,293 ) (5,293 )







Income (loss) from operations before income taxes
   $ 60,709       $ 20,803       $ (11,352 ) $ 70,160







Segment financial information for the nine months ended September 30, 2012 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Corporate
Activities and
Elimination Total

Sales to external customers
   $ 1,159,653       $ 621,069       $ —      $ 1,780,722

Intersegment sales/(elimination)
   17,214       8,659       (25,873 ) —







Total sales
   $ 1,176,867       $ 629,728       $ (25,873 ) $ 1,780,722







Income (loss) from operations
   $ 234,734       $ 68,934       $ (11,851 ) $ 291,817

Interest expense and other, net
   —         —         (11,587 ) (11,587 )







Income (loss) from operations before income taxes
   $ 234,734       $ 68,934       $ (23,438 ) $ 280,230







Segment financial information for the nine months ended September 30, 2011 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Corporate
Activities and
Elimination Total

Sales to external customers
   $ 860,729       $ 572,269       $ —      $ 1,432,998

Intersegment sales/(elimination)
   12,536       4,989       (17,525 ) —







Total sales
   $ 873,265       $ 577,258       $ (17,525 ) $ 1,432,998







Income (loss) from operations
   $ 160,682       $ 70,976       $ (33,466 ) $ 198,192

Interest expense and other, net
   —         —         (12,720 ) (12,720 )







Income (loss) from operations before income taxes
   $ 160,682       $ 70,976       $ (46,186 ) $ 185,472







Sales by Product

Sales by product are as follows:

   Three Months Ended
September 30,

In thousands
   2012    2011

Specialty Products & Electronics
   $ 264,094       $ 231,983

Remanufacturing, Overhaul & Build
   129,597       83,673

Brake Products
   127,027       121,372

Other Transit Products
   49,141       45,753

Other
   17,734       16,059





Total sales
   $ 587,593       $ 498,840





Sales by product are as follows:

   Nine Months Ended
September 30,

In thousands
   2012    2011

Specialty Products & Electronics
   $ 841,382       $ 622,857

Brake Products
   386,640       372,815

Remanufacturing, Overhaul & Build
   348,252       245,330

Other Transit Products
   149,941       145,637

Other
   54,507       46,359





Total sales
   $ 1,780,722       $ 1,432,998

v2.4.0.6

Sales by Product (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Segment Reporting Information [Line Items]

Total sales $ 587,593 $ 498,840 $ 1,780,722 $ 1,432,998

Specialty Products & Electronics [Member]

Segment Reporting Information [Line Items]

Total sales 264,094 231,983 841,382 622,857

Brake Products [Member]

Segment Reporting Information [Line Items]

Total sales 129,597 83,673 386,640 372,815

Remanufacturing, Overhaul & Build [Member]

Segment Reporting Information [Line Items]

Total sales 127,027 121,372 348,252 245,330

Other Transit Products [Member]

Segment Reporting Information [Line Items]

Total sales 49,141 45,753 149,941 145,637

Other [Member]

Segment Reporting Information [Line Items]

Total sales $ 17,734 $ 16,059 $ 54,507 $ 46,359

v2.4.0.6

GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION
9 Months Ended

Sep. 30, 2012

GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

15. GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

Effective August 2003, the Company issued $150 million of Senior Notes due in 2013 (“the Notes”). The obligations under the Notes are fully and unconditionally guaranteed by all U.S. subsidiaries as guarantors. In accordance with positions established by the Securities and Exchange Commission, the following shows separate financial information with respect to the parent, the guarantor subsidiaries and the non-guarantor subsidiaries. The principal elimination entries eliminate investment in subsidiaries and certain intercompany balances and transactions.

Balance Sheet as of September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors    Elimination Consolidated

Cash and cash equivalents
   $ 76,210    $ 5,622    $ 200,223       $ —      $ 282,055

Accounts receivable
   75    243,220    186,935       —      430,230

Inventories
   —      270,873    120,719       —      391,592

Other current assets
   62,889    6,500    10,783       —      80,172





Total current assets
   139,174    526,215    518,660       —      1,184,049

Property, plant and equipment
   4,243    125,031    99,873       —      229,147

Goodwill
   7,980    407,324    241,629       —      656,933

Investment in subsidiaries
   3,070,357    193,978    —         (3,264,335 ) —

Other intangibles
   —      166,620    118,269       —      284,889

Other long term assets
   (10,340 ) 3,377    47,987       —      41,024





Total Assets
   $ 3,211,414    $ 1,422,545    $ 1,026,418       $ (3,264,335 ) $ 2,396,042





Current liabilities
   $ 48,977    $ 326,916    $ 164,799       $ —      $ 540,692

Inter-company
   1,427,896    (1,588,017 ) 160,121       —      —

Long-term debt
   432,000    175    679       —      432,854

Other long term liabilities
   71,524    31,658    88,297       —      191,479





Total liabilities
   1,980,397    (1,229,268 ) 413,896       —      1,165,025

Stockholders’ equity
   1,231,017    2,651,813    612,522       (3,264,335 ) 1,231,017





Total Liabilities and Stockholders’ Equity
   $ 3,211,414    $ 1,422,545    $ 1,026,418       $ (3,264,335 ) $ 2,396,042





Balance Sheet as of December 31, 2011:

In thousands
   Parent Guarantors Non-Guarantors    Elimination Consolidated

Cash and cash equivalents
   $ 75,621    $ 14,024    $ 195,970       $ —      $ 285,615

Accounts receivable
   186    196,909    149,186       —      346,281

Inventories
   —      250,280    97,894       —      348,174

Other current assets
   59,990    5,989    9,733       —      75,712





Total current assets
   135,797    467,202    452,783       —      1,055,782

Property, plant and equipment, net
   3,655    123,182    95,185       —      222,022

Goodwill
   7,980    399,419    180,132       —      587,531

Investment in subsidiaries
   2,675,378    183,357    —         (2,858,735 ) —

Other intangibles, net
   —      174,351    83,004       —      257,355

Other long term assets
   (9,946 ) 5,640    40,569       —      36,263





Total assets
   $ 2,812,864    $ 1,353,151    $ 851,673       $ (2,858,735 ) $ 2,158,953





Current liabilities
   $ 72,396    $ 282,671    $ 186,318       —      $ 541,385

Intercompany
   1,222,650    (1,303,441 ) 80,791       —      —

Long-term debt
   395,000    198    607       —      395,805

Other long term liabilities
   75,174    33,790    65,155       —      174,119





Total liabilities
   1,765,220    (986,782 ) 332,871       —      1,111,309

Stockholders’ equity
   1,047,644    2,339,933    518,802       (2,858,735 ) 1,047,644





Total Liabilities and Stockholders’ Equity
   $ 2,812,864    $ 1,353,151    $ 851,673       $ (2,858,735 ) $ 2,158,953





Income Statement for the Three Months Ended September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 405,624    $ 219,621    $ (37,652 ) $ 587,593

Cost of sales
   (428 ) (264,211 ) (169,652 ) 17,977    (416,314 )



Gross (loss) profit
   (428 ) 141,413    49,969    (19,675 ) 171,279

Operating expenses
   (14,584 ) (37,786 ) (22,067 ) —      (74,437 )



Operating (loss) profit
   (15,012 ) 103,627    27,902    (19,675 ) 96,842

Interest (expense) income, net
   (5,459 ) 3,305    (916 ) —      (3,070 )

Other income (expense), net
   100    (860 ) (633 ) —      (1,393 )

Equity earnings
   102,624    24,971    —      (127,595 ) —



Income (loss) from operations before income tax
   82,253    131,043    26,353    (147,270 ) 92,379

Income tax expense
   (19,259 ) (3,428 ) (6,698 ) —      (29,385 )



Net income (loss) attributable to Wabtec shareholders
   $ 62,994    $ 127,615    $ 19,655    $ (147,270 ) $ 62,994



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 62,296    $ 127,615    $ 31,571    $ (147,270 ) $ 74,212



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Three Months Ended September 30, 2011:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 352,493    $ 182,465    $ (36,118 ) $ 498,840

Cost of sales
   (903 ) (216,913 ) (147,007 ) 13,134    (351,689 )



Gross (loss) profit
   (903 ) 135,580    35,458    (22,984 ) 147,151

Operating expenses
   (16,021 ) (37,922 ) (17,755 ) —      (71,698 )



Operating (loss) profit
   (16,924 ) 97,658    17,703    (22,984 ) 75,453

Interest (expense) income, net
   (5,538 ) 1,178    596    —      (3,764 )

Other income (expense), net
   173    211    (1,913 ) —      (1,529 )

Equity earnings
   82,561    21,337    —      (103,898 ) —



Income (loss) from operations before income tax
   60,272    120,384    16,386    (126,882 ) 70,160

Income tax expense
   (13,672 ) (2,868 ) (7,020 ) —      (23,560 )



Net income (loss) attributable to Wabtec shareholders
   $ 46,600    $ 117,516    $ 9,366    $ (126,882 ) $ 46,600



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 48,788    $ 117,516    $ (28,426 ) $ (126,882 ) $ 10,996



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Nine Months Ended September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 1,251,666    $ 653,230    $ (124,174 ) $ 1,780,722

Cost of sales
   (776 ) (810,101 ) (507,413 ) 51,655    (1,266,635 )



Gross (loss) profit
   (776 ) 441,565    145,817    (72,519 ) 514,087

Operating expenses
   (47,356 ) (115,649 ) (59,265 ) —      (222,270 )



Operating (loss) profit
   (48,132 ) 325,916    86,552    (72,519 ) 291,817

Interest (expense) income, net
   (16,291 ) 5,489    499    —      (10,303 )

Other income (expense), net
   8,221    6,954    (2,551 ) —      (1,284 )

Equity earnings
   304,263    61,931    —      (366,194 ) —



Income (loss) from operations before income tax
   248,061    386,382    84,500    (438,713 ) 280,230

Income tax expense
   (61,094 ) (10,239 ) (21,930 ) —      (93,263 )



Net income (loss) attributable to Wabtec shareholders
   $ 186,967    $ 376,143    $ 62,570    $ (438,713 ) $ 186,967



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 186,486    $ 376,143    $ 68,868    $ (438,713 ) $ 192,784



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Nine Months Ended September 30, 2011:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 1,006,000    $ 527,089    $ (100,091 ) $ 1,432,998

Cost of sales
   (1,282 ) (645,743 ) (405,980 ) 43,097    (1,009,908 )



Gross (loss) profit
   (1,282 ) 360,257    121,109    (56,994 ) 423,090

Operating expenses
   (64,002 ) (106,670 ) (54,226 ) —      (224,898 )



Operating (loss) profit
   (65,284 ) 253,587    66,883    (56,994 ) 198,192

Interest (expense) income, net
   (16,501 ) 3,463    1,797    —      (11,241 )

Other income (expense), net
   7,567    (816 ) (8,230 ) —      (1,479 )

Equity earnings
   231,392    49,370    —      (280,762 ) —



Income (loss) from operations before income tax
   157,174    305,604    60,450    (337,756 ) 185,472

Income tax expense
   (33,288 ) (9,897 ) (18,401 ) —      (61,586 )



Net income (loss) attributable to Wabtec shareholders
   $ 123,866    $ 295,707    $ 42,049    $ (337,756 ) $ 123,886



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 126,663    $ 295,707    $ 31,353    $ (337,756 ) $ 115,967



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Condensed Statement of Cash Flows for the Nine Months Ended September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors Elimination Consolidated

Net cash (used for) provided by operating activities
   $ (4,856 )   $ 390,163    $ 166,931    $ (438,713 ) $ 113,525

Net cash used for investing activities
   (3,841 ) (22,366 ) (99,860 ) —      (126,067 )

Net cash provided by (used for) financing activities
   9,286    (376,199 ) (62,506 ) 438,713    9,294

Effect of changes in currency exchange rates
   —      —      (312 ) —      (312 )



Increase (decrease) in cash
   589    (8,402 ) 4,253    —      (3,560 )

Cash, beginning of year
   75,621    14,024    195,970    —      285,615



Cash, end of period
   $ 76,210    $ 5,622    $ 200,223    $ —      $ 282,055



Condensed Statement of Cash Flows for the Nine Months Ended September 30, 2011:

In thousands
   Parent Guarantors Non-Guarantors Elimination Consolidated

Net cash provided by (used for) operating activities
   $ 9,543    $ 321,525    $ 106,708    $ (337,756 ) $ 100,020

Net cash used for investing activities
   (4,082 ) (30,033 ) (39,548 ) —      (73,663 )

Net cash (used for) provided by financing activities
   (33,944 ) (295,753 ) (41,923 ) 337,756    (33,864 )

Effect of changes in currency exchange rates
   —      —      (8,298 ) —      (8,298 )



(Decrease) increase in cash
   (28,483 ) (4,261 ) 16,939    —      (15,805 )

Cash, beginning of year
   42,714    13,226    181,001    —      236,941



Cash, end of period
   $ 14,231    $ 8,965    $ 197,940    $ —      $ 221,136

v2.4.0.6

GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION (Tables)
9 Months Ended

Sep. 30, 2012

Guarantor Subsidiaries Balance Sheet

Balance Sheet as of September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors    Elimination Consolidated

Cash and cash equivalents
   $ 76,210    $ 5,622    $ 200,223       $ —      $ 282,055

Accounts receivable
   75    243,220    186,935       —      430,230

Inventories
   —      270,873    120,719       —      391,592

Other current assets
   62,889    6,500    10,783       —      80,172





Total current assets
   139,174    526,215    518,660       —      1,184,049

Property, plant and equipment
   4,243    125,031    99,873       —      229,147

Goodwill
   7,980    407,324    241,629       —      656,933

Investment in subsidiaries
   3,070,357    193,978    —         (3,264,335 ) —

Other intangibles
   —      166,620    118,269       —      284,889

Other long term assets
   (10,340 ) 3,377    47,987       —      41,024





Total Assets
   $ 3,211,414    $ 1,422,545    $ 1,026,418       $ (3,264,335 ) $ 2,396,042





Current liabilities
   $ 48,977    $ 326,916    $ 164,799       $ —      $ 540,692

Inter-company
   1,427,896    (1,588,017 ) 160,121       —      —

Long-term debt
   432,000    175    679       —      432,854

Other long term liabilities
   71,524    31,658    88,297       —      191,479





Total liabilities
   1,980,397    (1,229,268 ) 413,896       —      1,165,025

Stockholders’ equity
   1,231,017    2,651,813    612,522       (3,264,335 ) 1,231,017





Total Liabilities and Stockholders’ Equity
   $ 3,211,414    $ 1,422,545    $ 1,026,418       $ (3,264,335 ) $ 2,396,042





Balance Sheet as of December 31, 2011:

In thousands
   Parent Guarantors Non-Guarantors    Elimination Consolidated

Cash and cash equivalents
   $ 75,621    $ 14,024    $ 195,970       $ —      $ 285,615

Accounts receivable
   186    196,909    149,186       —      346,281

Inventories
   —      250,280    97,894       —      348,174

Other current assets
   59,990    5,989    9,733       —      75,712





Total current assets
   135,797    467,202    452,783       —      1,055,782

Property, plant and equipment, net
   3,655    123,182    95,185       —      222,022

Goodwill
   7,980    399,419    180,132       —      587,531

Investment in subsidiaries
   2,675,378    183,357    —         (2,858,735 ) —

Other intangibles, net
   —      174,351    83,004       —      257,355

Other long term assets
   (9,946 ) 5,640    40,569       —      36,263





Total assets
   $ 2,812,864    $ 1,353,151    $ 851,673       $ (2,858,735 ) $ 2,158,953





Current liabilities
   $ 72,396    $ 282,671    $ 186,318       —      $ 541,385

Intercompany
   1,222,650    (1,303,441 ) 80,791       —      —

Long-term debt
   395,000    198    607       —      395,805

Other long term liabilities
   75,174    33,790    65,155       —      174,119





Total liabilities
   1,765,220    (986,782 ) 332,871       —      1,111,309

Stockholders’ equity
   1,047,644    2,339,933    518,802       (2,858,735 ) 1,047,644





Total Liabilities and Stockholders’ Equity
   $ 2,812,864    $ 1,353,151    $ 851,673       $ (2,858,735 ) $ 2,158,953





Guarantor Subsidiaries Income Statement

Income Statement for the Three Months Ended September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 405,624    $ 219,621    $ (37,652 ) $ 587,593

Cost of sales
   (428 ) (264,211 ) (169,652 ) 17,977    (416,314 )



Gross (loss) profit
   (428 ) 141,413    49,969    (19,675 ) 171,279

Operating expenses
   (14,584 ) (37,786 ) (22,067 ) —      (74,437 )



Operating (loss) profit
   (15,012 ) 103,627    27,902    (19,675 ) 96,842

Interest (expense) income, net
   (5,459 ) 3,305    (916 ) —      (3,070 )

Other income (expense), net
   100    (860 ) (633 ) —      (1,393 )

Equity earnings
   102,624    24,971    —      (127,595 ) —



Income (loss) from operations before income tax
   82,253    131,043    26,353    (147,270 ) 92,379

Income tax expense
   (19,259 ) (3,428 ) (6,698 ) —      (29,385 )



Net income (loss) attributable to Wabtec shareholders
   $ 62,994    $ 127,615    $ 19,655    $ (147,270 ) $ 62,994



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 62,296    $ 127,615    $ 31,571    $ (147,270 ) $ 74,212



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Three Months Ended September 30, 2011:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 352,493    $ 182,465    $ (36,118 ) $ 498,840

Cost of sales
   (903 ) (216,913 ) (147,007 ) 13,134    (351,689 )



Gross (loss) profit
   (903 ) 135,580    35,458    (22,984 ) 147,151

Operating expenses
   (16,021 ) (37,922 ) (17,755 ) —      (71,698 )



Operating (loss) profit
   (16,924 ) 97,658    17,703    (22,984 ) 75,453

Interest (expense) income, net
   (5,538 ) 1,178    596    —      (3,764 )

Other income (expense), net
   173    211    (1,913 ) —      (1,529 )

Equity earnings
   82,561    21,337    —      (103,898 ) —



Income (loss) from operations before income tax
   60,272    120,384    16,386    (126,882 ) 70,160

Income tax expense
   (13,672 ) (2,868 ) (7,020 ) —      (23,560 )



Net income (loss) attributable to Wabtec shareholders
   $ 46,600    $ 117,516    $ 9,366    $ (126,882 ) $ 46,600



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 48,788    $ 117,516    $ (28,426 ) $ (126,882 ) $ 10,996



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Nine Months Ended September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 1,251,666    $ 653,230    $ (124,174 ) $ 1,780,722

Cost of sales
   (776 ) (810,101 ) (507,413 ) 51,655    (1,266,635 )



Gross (loss) profit
   (776 ) 441,565    145,817    (72,519 ) 514,087

Operating expenses
   (47,356 ) (115,649 ) (59,265 ) —      (222,270 )



Operating (loss) profit
   (48,132 ) 325,916    86,552    (72,519 ) 291,817

Interest (expense) income, net
   (16,291 ) 5,489    499    —      (10,303 )

Other income (expense), net
   8,221    6,954    (2,551 ) —      (1,284 )

Equity earnings
   304,263    61,931    —      (366,194 ) —



Income (loss) from operations before income tax
   248,061    386,382    84,500    (438,713 ) 280,230

Income tax expense
   (61,094 ) (10,239 ) (21,930 ) —      (93,263 )



Net income (loss) attributable to Wabtec shareholders
   $ 186,967    $ 376,143    $ 62,570    $ (438,713 ) $ 186,967



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 186,486    $ 376,143    $ 68,868    $ (438,713 ) $ 192,784



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Income Statement for the Nine Months Ended September 30, 2011:

In thousands
   Parent Guarantors Non-Guarantors Elimination(1) Consolidated

Net sales
   $ —      $ 1,006,000    $ 527,089    $ (100,091 ) $ 1,432,998

Cost of sales
   (1,282 ) (645,743 ) (405,980 ) 43,097    (1,009,908 )



Gross profit (loss)
   (1,282 ) 360,257    121,109    (56,994 ) 423,090

Operating expenses
   (64,002 ) (106,670 ) (54,226 ) —      (224,898 )



Operating (loss) profit
   (65,284 ) 253,587    66,883    (56,994 ) 198,192

Interest (expense) income, net
   (16,501 ) 3,463    1,797    —      (11,241 )

Other income (expense), net
   7,567    (816 ) (8,230 ) —      (1,479 )

Equity earnings
   231,392    49,370    —      (280,762 ) —



Income (loss) from operations before income tax
   157,174    305,604    60,450    (337,756 ) 185,472

Income tax expense
   (33,288 ) (9,897 ) (18,401 ) —      (61,586 )



Net income (loss) attributable to Wabtec shareholders
   $ 123,866    $ 295,707    $ 42,049    $ (337,756 ) $ 123,886



Comprehensive income (loss) attributable to Wabtec shareholders
   $ 126,663    $ 295,707    $ 31,353    $ (337,756 ) $ 115,967



(1) Includes elimination of gross profit realized with certain intercompany transactions between Guarantor and Non-Guarantor subsidiaries.

Guarantor Subsidiaries Condensed Statement of Cash Flows

Condensed Statement of Cash Flows for the Nine Months Ended September 30, 2012:

In thousands
   Parent Guarantors Non-Guarantors Elimination Consolidated

Net cash (used for) provided by operating activities
   $ (4,856)    $ 390,163    $ 166,931    $ (438,713 ) $ 113,525

Net cash used for investing activities
   (3,841 ) (22,366 ) (99,860 ) —      (126,067 )

Net cash provided by (used for) financing activities
   9,286    (376,199 ) (62,506 ) 438,713    9,294

Effect of changes in currency exchange rates
   —      —      (312 ) —      (312 )



Increase (decrease) in cash
   589    (8,402 ) 4,253    —      (3,560 )

Cash, beginning of year
   75,621    14,024    195,970    —      285,615



Cash, end of period
   $ 76,210    $ 5,622    $ 200,223    $ —      $ 282,055



Condensed Statement of Cash Flows for the Nine Months Ended September 30, 2011:

In thousands
   Parent Guarantors Non-Guarantors Elimination Consolidated

Net cash provided by (used for) operating activities
   $ 9,543    $ 321,525    $ 106,708    $ (337,756 ) $ 100,020

Net cash used for investing activities
   (4,082 ) (30,033 ) (39,548 ) —      (73,663 )

Net cash (used for) provided by financing activities
   (33,944 ) (295,753 ) (41,923 ) 337,756    (33,864 )

Effect of changes in currency exchange rates
   —      —      (8,298 ) —      (8,298 )



(Decrease) increase in cash
   (28,483 ) (4,261 ) 16,939    —      (15,805 )

Cash, beginning of year
   42,714    13,226    181,001    —      236,941



Cash, end of period
   $ 14,231    $ 8,965    $ 197,940    $ —      $ 221,136

v2.4.0.6

ACCOUNTING POLICIES (Policies)
9 Months Ended

Sep. 30, 2012

Basis Of Presentation

Basis of Presentation The unaudited condensed consolidated interim financial statements have been prepared in accordance with generally accepted accounting principles and the rules and regulations of the Securities and Exchange Commission and include the accounts of Wabtec and its majority owned subsidiaries. These condensed consolidated interim financial statements do not include all of the information and footnotes required for complete financial statements. In Management’s opinion, these financial statements reflect all adjustments of a normal, recurring nature necessary for a fair presentation of the results for the interim periods presented. Results for these interim periods are not necessarily indicative of results to be expected for the full year.

The Company operates on a four-four-five week accounting quarter, and the quarters end on or about March 31, June 30, September 30 and December 31.

The notes included herein should be read in conjunction with the audited consolidated financial statements included in Wabtec’s Annual Report on Form 10-K for the year ended December 31, 2011. The December 31, 2011 information has been derived from the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

Reclassifiactions
Reclassifications Certain prior year amounts have been reclassified where necessary to conform to the current year presentation.

Revenue Recognition

Revenue Recognition Revenue is recognized in accordance with Accounting Standards Codification (“ASC”) 605 “Revenue Recognition”. Revenue is recognized when products have been shipped to the respective customers, title has passed and the price for the product has been determined.

In general, the Company recognizes revenues on long-term contracts based on the percentage of completion method of accounting. The units-of-delivery method or other input-based or output-based measures, as appropriate, are used to measure the progress toward completion of individual contracts. Contract revenues and cost estimates are reviewed and revised at a minimum quarterly and adjustments are reflected in the accounting period as such amounts are determined. Provisions are made currently for estimated losses on uncompleted contracts. Unbilled accounts receivables were $92.5 million and $58.9, customer deposits were $104.4 million and $72.8, and provisions for loss contracts were $9.9 million and $9.3 million at September 30, 2012 and December 31, 2011, respectively.

Certain pre-production costs relating to long-term production and supply contracts have been deferred and will be recognized over the life of the contracts. Deferred pre-production costs were $16.4 million and $15.4 million at September 30, 2012 and December 31, 2011, respectively.

Use Of Estimates

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates. On an ongoing basis, management reviews its estimates based on currently available information. Changes in facts and circumstances may result in revised estimates.

Stock-Based Compensation

Stock-Based Compensation The Company recognizes compensation expense for stock-based compensation based on the grant date fair value amortized ratably over the requisite service period following the date of grant.

Financial Derivatives and Hedging Activities

Financial Derivatives and Hedging Activities The Company has periodically entered into foreign currency forward contracts to reduce the impact of changes in currency exchange rates. Forward contracts are agreements with a counter-party to exchange two distinct currencies at a set exchange rate for delivery on a set date at some point in the future. There is no exchange of funds until the delivery date. At the delivery date the Company can either take delivery of the currency or settle on a net basis. At September 30, 2012, the Company had no forward contracts.

To reduce the impact of interest rate changes on a portion of its variable-rate debt, the Company entered into interest rate swaps which effectively converted a portion of the debt from variable to fixed-rate borrowings during the term of the swap contracts. The Company is exposed to credit risk in the event of nonperformance by the counterparties. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparties are large financial institutions with excellent credit ratings and history of performance. The Company currently believes the risk of nonperformance is negligible. The Company concluded that these interest rate swap agreements qualify for cash flow hedge accounting which permits the recording of the fair value of the interest rate swap agreements and corresponding adjustment to other comprehensive income (loss), net of tax, on the balance sheet.

Effective September 30, 2012, the Company had interest rate swap agreements with a notional amount of $107.0 million and which effectively changed the Company’s interest rate on bank debt at September 30, 2012 from a variable rate to a fixed rate of 1.82%. The interest rate swap agreements mature on December 31, 2012. As of September 30, 2012, the Company has recorded a current liability of $0.4 million and a corresponding offset in accumulated other comprehensive loss of $0.3 million, net of tax, related to these agreements. Also, the Company entered into a forward starting interest rate swap agreement with a notional value of $150.0 million. Effective July 31, 2013, with a termination date of November 7, 2016, this interest rate swap agreement will convert a portion of the Company’s then outstanding debt from a variable rate to a fixed-rate borrowing. During the term of the interest rate swap agreement the interest rate on the notional value will be fixed at 1.415% plus the Alternate Rate margin. As of September 30, 2012, the Company has recorded a current liability of $4.1 million and a corresponding offset in accumulated other comprehensive loss of $2.5 million, net of tax, related to this agreement.

Foreign Currency Translation

Foreign Currency Translation Assets and liabilities of foreign subsidiaries, except for the Company’s Mexican operations whose functional currency is the U.S. Dollar, are translated at the rate of exchange in effect on the balance sheet date while income and expenses are translated at the average rates of exchange prevailing during the year. Foreign currency gains and losses resulting from transactions, and the translation of financial statements are recorded in the Company’s consolidated financial statements based upon the provisions of ASC 830 “Foreign Currency Matters.” The effects of currency exchange rate changes on intercompany transactions and balances of a long-term investment nature are accumulated and carried as a component of accumulated other comprehensive loss. The effects of currency exchange rate changes on intercompany transactions that are denominated in a currency other than an entity’s functional currency are charged or credited to earnings. Foreign exchange transaction losses recognized in other income (expense), net were $1.4 million and $1.8 million for the three months ended September 30, 2012 and 2011, respectively. Foreign exchange transaction losses recognized in other income (expense), net were $0.4 million and $2.1 million for the nine months ended September 30, 2012 and 2011, respectively.

Non-controlling Interests

Non-controlling Interests In accordance with ASC 810, the Company has classified non-controlling interests as equity on our condensed consolidated balance sheets as of September 30, 2012 and December 31, 2011. Net income attributable to non-controlling interests for the three and nine months ended September 30, 2012 and 2011 was not material.

Other Comprehensive Income

Other Comprehensive Income Comprehensive income is defined as net income and all other non-owner changes in shareholders’ equity.

The components of accumulated other comprehensive loss were:

In thousands
   September 30,
2012 December 31,
2011

Foreign currency translation loss
   $ 3,851    $ (2,447 )

Unrealized loss on interest rate swap contracts, net of tax
   (2,722 ) (871 )

Pension benefit plans and post retirement benefit plans, net of tax
   (56,209 ) (57,579 )



Total accumulated comprehensive loss
   $ (55,080 ) $ (60,897 )

v2.4.0.6

Guarantor Subsidiaries Income Statement (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Condensed Financial Statements, Captions [Line Items]

Net sales $ 587,593 $ 498,840 $ 1,780,722 $ 1,432,998

Cost of sales (416,314) (351,689) (1,266,635) (1,009,908)

Gross (loss) profit 171,279 147,151 514,087 423,090

Operating expenses (74,437) (71,698) (222,270) (224,898)

Operating (loss) profit 96,842 75,453 291,817 198,192

Interest (expense) income, net (3,070) (3,764) (10,303) (11,241)

Other income (expense), net (1,393) (1,529) (1,284) (1,479)

Income (loss) from operations before income tax 92,379 70,160 280,230 185,472

Income tax expense (29,385) (23,560) (93,263) (61,586)

Net income (loss) attributable to Wabtec shareholders 62,994 46,600 186,967 123,886

Comprehensive income (loss) attributable to Wabtec shareholders 74,212 10,996 192,784 115,967

Parent Company [Member]

Condensed Financial Statements, Captions [Line Items]

Cost of sales (428) (903) (776) (1,282)

Gross (loss) profit (428) (903) (776) (1,282)

Operating expenses (14,584) (16,021) (47,356) (64,002)

Operating (loss) profit (15,012) (16,924) (48,132) (65,284)

Interest (expense) income, net (5,459) (5,538) (16,291) (16,501)

Other income (expense), net 100 173 8,221 7,567

Equity earnings 102,624 82,561 304,263 231,392

Income (loss) from operations before income tax 82,253 60,272 248,061 157,174

Income tax expense (19,259) (13,672) (61,094) (33,288)

Net income (loss) attributable to Wabtec shareholders 62,994 46,600 186,967 123,866

Comprehensive income (loss) attributable to Wabtec shareholders 62,296 48,788 186,486 126,663

Guarantor Subsidiaries [Member]

Condensed Financial Statements, Captions [Line Items]

Net sales 405,624 352,493 1,251,666 1,006,000

Cost of sales (264,211) (216,913) (810,101) (645,743)

Gross (loss) profit 141,413 135,580 441,565 360,257

Operating expenses (37,786) (37,922) (115,649) (106,670)

Operating (loss) profit 103,627 97,658 325,916 253,587

Interest (expense) income, net 3,305 1,178 5,489 3,463

Other income (expense), net (860) 211 (6,954) (816)

Equity earnings 24,971 21,337 61,931 49,370

Income (loss) from operations before income tax 131,043 120,384 386,382 305,604

Income tax expense (3,428) (2,868) (10,239) (9,897)

Net income (loss) attributable to Wabtec shareholders 127,615 117,516 376,143 295,707

Comprehensive income (loss) attributable to Wabtec shareholders 127,615 117,516 376,143 295,707

Non-Guarantor Subsidiaries [Member]

Condensed Financial Statements, Captions [Line Items]

Net sales 219,621 182,465 653,230 527,089

Cost of sales (169,652) (147,007) (507,413) (405,980)

Gross (loss) profit 49,969 35,458 145,817 121,109

Operating expenses (22,067) (17,755) (59,265) (54,226)

Operating (loss) profit 27,902 17,703 86,552 66,883

Interest (expense) income, net (916) 596 499 1,797

Other income (expense), net (633) (1,913) (2,551) (8,230)

Income (loss) from operations before income tax 26,353 16,386 84,500 60,450

Income tax expense (6,698) (7,020) (21,930) (18,401)

Net income (loss) attributable to Wabtec shareholders 19,655 9,366 62,570 42,049

Comprehensive income (loss) attributable to Wabtec shareholders 31,571 (28,426) 68,868 31,353

Elimination [Member]

Condensed Financial Statements, Captions [Line Items]

Net sales (37,652) (36,118) (124,174) (100,091)

Cost of sales 17,977 13,134 51,655 43,097

Gross (loss) profit (19,675) (22,984) (72,519) (56,994)

Operating (loss) profit (19,675) (22,984) (72,519) (56,994)

Equity earnings (127,595) (103,898) (366,194) (280,762)

Income (loss) from operations before income tax (147,270) (126,882) (438,713) (337,756)

Net income (loss) attributable to Wabtec shareholders (147,270) (126,882) (438,713) (337,756)

Comprehensive income (loss) attributable to Wabtec shareholders $ (147,270) $ (126,882) $ (438,713) $ (337,756)

v2.4.0.6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $)
9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Cash dividends, per share $ 0.11 $ 0.05

v2.4.0.6

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)

Sep. 30, 2012

Dec. 31, 2011

Preferred stock, authorized 1,000,000 1,000,000

Preferred stock, shares issued 0 0

Common stock, par value $ 0.01 $ 0.01

Common stock, shares authorized 100,000,000 100,000,000

Common stock, shares issued 66,174,767 66,174,767

Common stock, shares outstanding 47,887,204 47,946,360

Treasury stock, shares 18,287,563 18,228,407

v2.4.0.6

EARNINGS PER SHARE
9 Months Ended

Sep. 30, 2012

EARNINGS PER SHARE

10. 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,

In thousands, except per share
   2012 2011

Numerator


Numerator for basic and diluted earnings per common share—net income attributable to Wabtec shareholders
   $ 62,994    $ 46,600

Less: dividends declared—common shares and non-vested restricted stock
   (2,376 ) (1,442 )



Undistributed earnings
   60,618    45,158

Percentage allocated to common shareholders(1)
   99.5 % 99.5 %



   60,315    44,932

Add: dividends declared—common shares
   2,364    1,435



Numerator for basic and diluted earnings per common share
   $ 62,679    $ 46,366



Denominator


Denominator for basic earnings per common share—weighted-average shares
   47,643    47,874

Effect of dilutive securities:


Assumed conversion of dilutive stock-based compensation plans
   628    492



Denominator for diluted earnings per common share—adjusted weighted-average shares and assumed conversion
   48,271    48,365



Net income per common share attributable to Wabtec shareholders


Basic
   $ 1.32    $ 0.97

Diluted
   $ 1.30    $ 0.96

(1) Basic weighted-average common shares outstanding
   47,643    47,874

Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest
   47,874    48,123

Percentage allocated to common shareholders
   99.5 % 99.5 %

   Nine Months Ended
September 30,

In thousands, except per share
   2012 2011

Numerator


Numerator for basic and diluted earnings per common share—net income attributable to Wabtec shareholders
   $ 186,967    $ 123,886

Less: dividends declared—common shares and non-vested restricted stock
   (5,25 6) (2,407 )



Undistributed earnings
   181,711    121,479

Percentage allocated to common shareholders(1)
   99.5 % 99.5 %



   180,802    120,872

Add: dividends declared—common shares
   5,229    2,395



Numerator for basic and diluted earnings per common share
   $ 186,031    $ 123,267



Denominator


Denominator for basic earnings per common share—weighted-average shares
   47,732    47,827

Effect of dilutive securities:


Assumed conversion of dilutive stock-based compensation plans
   628    500



Denominator for diluted earnings per common share—adjusted weighted-average shares and assumed conversion
   48,360    48,327



Net income per common share attributable to Wabtec shareholders


Basic
   $ 3.90    $ 2.58

Diluted
   $ 3.85    $ 2.56

(1) Basic weighted-average common shares outstanding
   47,732    47,827

Basic weighted-average common shares outstanding and non-vested restricted stock expected to vest
   47,977    48,064

Percentage allocated to common shareholders
   99.5 % 99.5 %

The Company’s non-vested restricted stock contains rights to receive nonforfeitable dividends, and thus, are participating securities requiring the two-class method of computing earnings per share. The calculation of earnings per share for common stock shown above excludes the income attributable to the non-vested restricted stock from the numerator and excludes the dilutive impact of those shares from the denominator.

v2.4.0.6

Document and Entity Information
9 Months Ended

Sep. 30, 2012

Oct. 26, 2012

Entity Information [Line Items]

Document Type 10-Q

Amendment Flag false

Document Period End Date Sep. 30, 2012

Document Fiscal Year Focus 2012

Document Fiscal Period Focus Q3

Trading Symbol WAB

Entity Registrant Name WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORP

Entity Central Index Key 0000943452

Current Fiscal Year End Date --12-31

Entity Filer Category Large Accelerated Filer

Entity Common Stock, Shares Outstanding 47,887,404

v2.4.0.6

WARRANTIES
9 Months Ended

Sep. 30, 2012

WARRANTIES

11. WARRANTIES

The following table reconciles the changes in the Company’s product warranty reserve as follows:

   Nine Months Ended
September 30,

In thousands
   2012 2011

Balance at December 31, 2011 and 2010, respectively
   $ 50,640    $ 35,513

Warranty expense
   18,334    12,602

Acquisitions
   494    12,008

Warranty claim payments
   (11,971 ) (12,921 )



Balance at September 30, 2012 and 2011, respectively
   $ 57,497    $ 47,202

v2.4.0.6

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Net sales $ 587,593 $ 498,840 $ 1,780,722 $ 1,432,998

Cost of sales (416,314) (351,689) (1,266,635) (1,009,908)

Gross profit 171,279 147,151 514,087 423,090

Selling, general and administrative expense (59,743) (57,676) (180,935) (186,435)

Engineering expense (10,753) (9,894) (31,047) (27,914)

Amortization expense (3,941) (4,128) (10,288) (10,549)

Total operating expenses (74,437) (71,698) (222,270) (224,898)

Income from operations 96,842 75,453 291,817 198,192

Other income and expenses

Interest expense, net (3,070) (3,764) (10,303) (11,241)

Other (expense) income, net (1,393) (1,529) (1,284) (1,479)

Income (loss) from operations before income tax 92,379 70,160 280,230 185,472

Income tax expense (29,385) (23,560) (93,263) (61,586)

Net income attributable to Wabtec shareholders $ 62,994 $ 46,600 $ 186,967 $ 123,886

Basic

Net income attributable to Wabtec shareholders $ 1.32 $ 0.97 $ 3.90 $ 2.58

Diluted

Net income attributable to Wabtec shareholders $ 1.30 $ 0.96 $ 3.85 $ 2.56

Weighted average shares outstanding

Basic 47,643 47,874 47,732 47,827

Diluted 48,271 48,366 48,360 48,327

v2.4.0.6

INTANGIBLES
9 Months Ended

Sep. 30, 2012

INTANGIBLES

5. INTANGIBLES

Goodwill was $656.9 million and $587.5 million at September 30, 2012 and December 31, 2011, respectively. The change in the carrying amount of goodwill by segment for the nine months ended September 30, 2012 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Total

Balance at December 31, 2011
   $ 388,221       $ 199,310       $ 587,531

Acquisition
   4,781       56,778       61,559

Adjustment to preliminary purchase allocation
   2,754       1,154       3,908

Foreign currency impact
   2,116       1,819       3,935







Balance at September 30, 2012
   $ 397,872       $ 259,061       $ 656,933







As of September 30, 2012 and December 31, 2011, the Company’s trademarks had a net carrying amount of $126.1 million and $114.6 million, respectively, and the Company believes these intangibles have an indefinite life. Intangible assets of the Company, other than goodwill and trademarks, consist of the following:

In thousands
   September 30,
2012    December 31,
2011

Patents and other, net of accumulated amortization of $34,650 and $32,316
   $ 11,799       $ 14,849

Customer relationships, net of accumulated amortization of $28,509 and $21,295
   146,973       127,960





Total
   $ 158,772       $ 142,809





The weighted average remaining useful life of patents, customer relationships and intellectual property were five years, 16 years and 17 years, respectively. Amortization expense for intangible assets was $3.9 million and $10.3 million for the three and nine months ended September 30, 2012, respectively and $4.1 million and $10.5 million for the three and nine months ended September 30, 2011, respectively.

Amortization expense for the five succeeding years is as follows (in thousands):

Remainder of 2012
   $ 4,521

2013
   13,467

2014
   12,630

2015
   11,872

2016
   11,715

v2.4.0.6

INVENTORIES
9 Months Ended

Sep. 30, 2012

INVENTORIES

4. INVENTORIES

The components of inventory, net of reserves, were:

In thousands
   September 30,
2012    December 31,
2011

Raw materials
   $ 165,139       $ 154,885

Work-in-process
   135,152       110,179

Finished goods
   91,301       83,110





Total inventories
   $ 391,592       $ 348,174

v2.4.0.6

OTHER INCOME (EXPENSE), NET
9 Months Ended

Sep. 30, 2012

OTHER INCOME (EXPENSE), NET

16. OTHER INCOME (EXPENSE), NET

The components of other income (expense) are as follows:

   Three Months Ended
September 30, Nine Months Ended
September 30,

In thousands
   2012 2011 2012 2011

Foreign currency loss
   $ (1,468 ) $ (1,795 ) $ (427 ) $ (2,061 )

Other miscellaneous income (expense)
   75 266    (857 )   582



Total other (expense) income, net
   $ (1,393 ) $ (1,529 ) $ (1,284 ) $ (1,479 )

v2.4.0.6

FAIR VALUE MEASUREMENT
9 Months Ended

Sep. 30, 2012

FAIR VALUE MEASUREMENT

12. FAIR VALUE MEASUREMENT

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 following table provides the liabilities carried at fair value measured on a recurring basis as of September 30, 2012, which are included in other current liabilities on the Condensed Consolidated Balance sheet:

   Total Carrying
Value at
September 30,
2012    Fair Value Measurements at September 30, 2012 Using

In thousands
      Quoted Prices in
Active Markets for
Identical Assets
(Level 1)    Significant Other
Observable Inputs
(Level 2)    Significant
Unobservable
Inputs
(Level 3)

Interest rate swap agreements
   4,507             —    4,507       —









Total
   $ 4,507       $    —    $ 4,507       $ —

The following table provides the liabilities carried at fair value measured on a recurring basis as of December 31, 2011, which is included in other current liabilities on the Condensed Consolidated Balance sheet:

   Total Carrying
Value at
December 31,
2011    Fair Value Measurements at December 31, 2011 Using

In thousands
      Quoted Prices in
Active Markets for
Identical Assets
(Level 1)    Significant Other
Observable Inputs
(Level 2)    Significant
Unobservable
Inputs
(Level 3)

Interest rate swap agreements
   1,442       —         1,442       —









Total
   $ 1,442       $ —         $ 1,442       $ —

To reduce the impact of interest rate changes on a portion of its variable-rate debt, the Company entered into interest rate swaps which effectively converted a portion of the debt from variable to fixed-rate borrowings during the term of the swap contracts. For certain derivative contracts whose fair values are based upon trades in liquid markets, such as interest rate swaps, valuation model inputs can generally be verified and valuation techniques do not involve significant management judgment. The fair values of such financial instruments are generally classified within Level 2 of the fair value hierarchy.

v2.4.0.6

STOCK-BASED COMPENSATION
9 Months Ended

Sep. 30, 2012

STOCK-BASED COMPENSATION

8. STOCK-BASED COMPENSATION

As of September 30, 2012, the Company maintains employee stock-based compensation plans for stock options, restricted stock, restricted units, and incentive stock awards as governed by the 2011 Stock Incentive Compensation Plan (the “2011 Plan”) and the 2000 Stock Incentive Plan, as amended (the “2000 Plan”). The 2011 Plan was approved by stockholders of Wabtec on May 11, 2011. The Company also maintains a Non-Employee Directors’ Fee and Stock Option Plan (“Directors Plan”). No awards may be made under the 2000 Plan or the Directors Plan subsequent to October 31, 2016. The 2011 Plan has a 10- year term through March 27, 2021 and provides a maximum of 1,900,000 shares for grants or awards.

Stock-based compensation expense was $5.4 million and $3.9 million for the three months ended September 30, 2012 and 2011, respectively. Stock-based compensation expense was $15.4 million and $13.2 million for the nine months ended September 30, 2012 and 2011, respectively. Included in the stock-based compensation expense for the nine months ended September 30, 2012 above is $1.9 million of expense related to stock options, $3.6 million related to restricted stock, $388,000 related to restricted units, $8.9 million related to incentive stock awards and $600,000 related to awards issued for Directors’ fees. At September 30, 2012, unamortized compensation expense related to stock options, restricted stock, restricted units and incentive stock awards expected to vest totaled $25.5 million and will be recognized over a weighted average period of 1.2 years.

Stock Options Stock options are granted to eligible employees and directors at the fair market value, which is the average of the high and low Wabtec stock price on the date of grant. Under the 2011 Plan and the 2000 Plan, options become exercisable over a four-year vesting period and expire 10 years from the date of grant. Under the Directors Plan, options become exercisable over a three-year vesting period and expire 10 years from the date of grant.

The following table summarizes the Company’s stock option activity and related information for the 2011 Plan, the 2000 Plan and the Directors Plan for the nine months ended September 30, 2012:

   Options Weighted
Average
Exercise
Price    Weighted Average
Remaining
Contractual Life    Aggregate
intrinsic value
(in thousands)

Outstanding at December 31, 2011
   862,392    $ 34.74       6.5       $ 30,362

Granted
   75,698    70.71          725

Exercised
   (125,788 ) 24.01          (7,079 )

Canceled
   (26,717 ) 34.46          (1,224 )







Outstanding at September 30, 2012
   785,585    $ 39.94       6.4       $ 31,701







Exercisable at September 30, 2012
   498,381    $ 32.95       6.2       $ 23,592

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

   Nine months ended
September 30,

   2012 2011

Dividend yield
   .23 % .08 %

Risk-free interest rate
   1.35 % 2.96 %

Stock price volatility
   44.95 % 45.6 %

Expected life (years)
   5.0    5.0

The dividend yield is based on the Company’s dividend rate and the current market price of the underlying common stock at the date of grant. Expected life in years is determined from historical stock option exercise data. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free interest rate is based on the U.S. Treasury bond rates for the expected life of the option.

Restricted Stock, Restricted Units and Incentive Stock Beginning in 2006 the Company adopted a restricted stock program. As provided for under the 2011 and 2000 Plans, eligible employees are granted restricted stock or restricted units that generally vest over four years from the date of grant. Under the Directors Plan, restricted stock awards vest one year from the date of grant.

In addition, the Company has annually issued incentive stock awards to eligible employees that vest, upon attainment of certain three year performance goals. Based on the Company’s performance for each three year period then ended, the incentive stock awards can vest and be awarded ranging from 0% to 200% of the initial incentive stock awards granted. The incentive stock awards included in the table below represent the number of shares that are expected to vest based on the Company’s estimate for meeting those established performance targets. As of September 30, 2012, the Company estimates that it will achieve 200%, 200% and 126% for the incentive stock awards expected to vest based on performance for the three year periods ending December 31, 2012, 2013, and 2014, respectively, and has recorded incentive compensation expense accordingly. If our estimate of the number of these stock awards 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 restricted stock and incentive stock awards is based on the average of the high and low Wabtec stock price on the date of grant and recognized over the applicable vesting period.

The following table summarizes the restricted stock and unit activity for the 2011 Plan, the 2000 Plan and the Directors Plan, and incentive stock awards activity for the 2011 Plan and the 2000 Plan with related information for the nine months ended September 30, 2012:

   Restricted
Stock
and Units Incentive
Stock
Awards Weighted
Average Grant
Date Fair
Value

Outstanding at December 31, 2011
   274,609    646,362    $ 44.04

Granted
   110,980    118,660    70.85

Vested
   (98,694 ) (122,079 ) 35.73

Adjustment for incentive stock awards expected to vest
   —      45,784    60.61

Canceled
   (13,008 ) (2,219 ) 42.96



Outstanding at September 30, 2012
   273,887    686,508    $ 53.17

v2.4.0.6

Computation of Basic and Diluted Earnings Per Share (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Earnings Per Share Basic And Diluted By Common Class [Line Items]

Numerator for basic and diluted earnings per common share-net income attributable to Wabtec shareholders $ 62,994 $ 46,600 $ 186,967 $ 123,886

Less: dividends declared-common shares and non-vested restricted stock (2,376) (1,442) (5,256) (2,407)

Undistributed earnings 60,618 45,158 181,711 121,479

Percentage allocated to common shareholders 99.50% 99.50% 99.50% 99.50%

Undistributed earnings allocated to common shareholders 60,315 44,932 180,802 120,872

Add: dividends declared-common shares 2,364 1,435 5,229 2,395

Numerator for basic and diluted earnings per common share $ 62,679 $ 46,367 $ 186,031 $ 123,267

Denominator for basic earnings per common share-weighted-average shares 47,643 47,874 47,732 47,827

Assumed conversion of dilutive stock-based compensation plans 628 492 628 500

Denominator for diluted earnings per common share-adjusted weighted-average shares and assumed conversion 48,271 48,366 48,360 48,327

Basic $ 1.32 $ 0.97 $ 3.90 $ 2.58

Diluted $ 1.30 $ 0.96 $ 3.85 $ 2.56

v2.4.0.6

LONG-TERM DEBT
9 Months Ended

Sep. 30, 2012

LONG-TERM DEBT

6. LONG-TERM DEBT

Long-term debt consisted of the following:

In thousands
   September 30,
2012    December 31,
2011

6.875% Senior Notes, due 2013
   $ 150,000       $ 150,000

Revolving Credit Facility
   282,000       245,000

Capital Leases
   897       873





Total
   432,897       395,873

Less—current portion
   43       68





Long-term portion
   $ 432,854       $ 395,805





2011 Refinancing Credit Agreement

On November 7, 2011, the Company refinanced its existing revolving credit and term loan facility with a consortium of commercial banks. This “2011 Refinancing Credit Agreement” provides the Company with a $600 million, five-year revolving credit facility. The Company incurred approximately $2.0 million of deferred financing cost related to the 2011 Refinancing Credit Agreement. The facility expires on November 7, 2016. The 2011 Refinancing Credit Agreement borrowings bear variable interest rates indexed to the indices described below. At September 30, 2012, the Company had available bank borrowing capacity of approximately $264.6 million, net of $53.4 million of letters of credit, subject to certain financial covenant restrictions.

Under the 2011 Refinancing Credit Agreement, the Company may elect a Base Rate of interest or an interest rate based on the London Interbank Offered Rate (“LIBOR”) of interest (“the Alternate Rate”). The Base Rate adjusts on a daily basis and is the greater of the Federal Funds Effective Rate plus 0.5% per annum, the PNC, N.A. prime rate or the Daily LIBOR Rate plus 100 basis points and an additional margin that ranges from 0 to 75 basis points. The Alternate Rate is based on quoted LIBOR rates plus a margin that ranges from 75 to 175 basis points. Both the Base Rate and Alternate Rate margins are dependent on the Company’s consolidated total indebtedness to cash flow ratios. The current Base Rate margin is 0 basis points and the Alternate Rate margin is 100 basis points.

At September 30, 2012 the weighted average interest rate on the Company’s variable rate debt was 1.23%. To reduce the impact of interest rate changes on a portion of this variable-rate debt, the Company entered into interest rate swap agreements which effectively convert a portion of the debt from a variable to a fixed-rate borrowing during the term of the swap contracts. On September 30, 2012, the notional value of the interest rate swaps outstanding was $107.0 million and effectively changed the Company’s interest rate on bank debt at September 30, 2012 from a variable rate to a fixed rate of 1.82%. The interest rate swap agreements mature on December 31, 2012. The Company is exposed to credit risk in the event of nonperformance by the counterparties. However, since only the cash interest payments are exchanged, exposure is significantly less than the notional amount. The counterparties are large financial institutions with excellent credit ratings and history of performance. The Company currently believes the risk of nonperformance is negligible.

Also, the Company entered into a forward starting interest rate swap agreement with a notional value of $150.0 million. Effective July 31, 2013, with a termination date of November 7, 2016, the interest rate swap agreement will convert a portion of the Company’s then outstanding debt from a variable rate to a fixed-rate borrowing. During the term of the interest rate swap agreement the interest rate on the notional value will be fixed at 1.415% plus the Alternate Rate margin.

The 2011 Refinancing Credit Agreement limits the Company’s ability to declare or pay cash dividends and prohibits the Company from declaring or making other distributions, subject to certain exceptions. The 2011 Refinancing Credit Agreement contains various other covenants and restrictions including the following limitations: incurrence of additional indebtedness; mergers, consolidations, sales of assets and acquisitions; additional liens; sale and leasebacks; permissible investments, loans and advances; certain debt payments; and imposes a minimum interest expense coverage ratio of 3.0 and a maximum debt to cash flow ratio of 3.25. The Company does not expect that these measurements will limit the Company in executing our operating activities.

6.875% Senior Notes Due August 2013

In August 2003, the Company issued $150.0 million of Senior Notes due in 2013 (“the Notes”). The Notes were issued at par. Interest on the Notes accrues at a rate of 6.875% per annum and is payable semi-annually on January 31 and July 31 of each year. The proceeds were used to repay debt outstanding under the Company’s existing credit agreement, and for general corporate purposes. The principal balance is due in full at maturity. The Company has both the intent and ability to refinance the Notes, maturing August 2013, on a long term basis utilizing capacity under the 2011 Refinancing Credit Agreement. The 2011 Refinancing Credit Agreement will provide available bank borrowing capacity sufficient to refinance the Notes on a long-term basis. The Notes are included in the long-term portion of debt as of September 30, 2012.

The Notes are senior unsecured obligations of the Company and rank pari passu with all existing and future senior debt and senior to all existing and future subordinated indebtedness of the Company. The indenture under which the Notes were issued contains covenants and restrictions which limit among other things, the following: the incurrence of indebtedness, payment of dividends and certain distributions, sale of assets, change in control, mergers and consolidations and the incurrence of liens.

v2.4.0.6

EMPLOYEE BENEFIT PLANS
9 Months Ended

Sep. 30, 2012

EMPLOYEE BENEFIT PLANS

7. EMPLOYEE BENEFIT PLANS

Defined Benefit Pension Plans

The Company sponsors defined benefit pension plans that cover certain U.S., Canadian, German, and United Kingdom employees and which provide benefits of stated amounts for each year of service of the employee.

The Company uses a December 31 measurement date for the plans. The following tables provide information regarding the Company’s defined benefit pension plans summarized by U.S. and international components.

   U.S. International

   Three months ended
September 30, Three months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ 94    $ 84    $ 493    $ 805

Interest cost
   501    582    1,773    1,886

Expected return on plan assets
   (771 ) (796 ) (2,035 ) (2,124 )

Net amortization/deferrals
   659    710    681    533

Settlement loss recognized
   —      —      844    132



Net periodic benefit cost
   $ 483    $ 580    $ 1,756    $ 1,232



Assumptions


Discount rate
   4.30 % 5.20 % 4.96 % 5.43 %

Expected long-term rate of return
   7.50 % 8.00 % 6.12 % 6.72 %

Rate of compensation increase
   3.00 % 3.00 % 3.21 % 3.17 %

   U.S. International

   Nine months ended
September 30, Nine months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ 285    $ 232    $ 1,479    $ 2,427

Interest cost
   1,585    1,820    5,309    5,735

Expected return on plan assets
   (2,321 ) (2,498 ) (6,085 ) (6,418 )

Net amortization/deferrals
   2,272    1,923    2,032    1,551

Settlement loss recognized
   —      —      1,137    720



Net periodic benefit cost
   $ 1,821    $ 1,477    $ 3,872    $ 4,015



Assumptions


Discount rate
   4.30 % 5.20 % 4.96 % 5.43 %

Expected long-term rate of return
   7.50 % 8.00 % 6.12 % 6.72 %

Rate of compensation increase
   3.00 % 3.00 % 3.21 % 3.17 %

The Company’s funding methods are based on governmental requirements and differ from those methods used to recognize pension expense. The Company expects to contribute $1.6 million to the U.S. plans and $6.4 million to the international plans during 2012.

Post Retirement Benefit Plans

In addition to providing pension benefits, the Company has provided certain unfunded postretirement health care and life insurance benefits for a portion of North American employees. The Company is not obligated to pay health care and life insurance benefits to individuals who had retired prior to 1990.

The Company uses a December 31 measurement date for all post retirement plans. The following tables provide information regarding the Company’s post retirement benefit plans summarized by U.S. and international components.

   U.S. International

   Three months ended
September 30, Three months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ (1 ) $ 4    $ 11    $ 14

Interest cost
   339    410    51    58

Net amortization/deferrals
   (212 ) (186 ) (83 ) (97 )



Net periodic benefit cost
   $ 126    $ 228    $ (21 ) $ (25 )



Assumptions


Discount rate
   4.30 % 5.20 % 5.15 % 5.50 %

   U.S. International

   Nine months ended
September 30, Nine months ended
September 30,

In thousands, except percentages
   2012 2011 2012 2011

Net periodic benefit cost


Service cost
   $ 18    $ 24    $ 33    $ 42

Interest cost
   1,040    1,208    151    175

Net amortization/deferrals
   (613 ) (675 ) (247 ) (292 )



Net periodic benefit cost
   $ 445    $ 557    $ (63 ) $ (75 )



Assumptions


Discount rate
   4.30 % 5.20 % 5.15 % 5.50 %

v2.4.0.6

INCOME TAXES
9 Months Ended

Sep. 30, 2012

INCOME TAXES

9. INCOME TAXES

The overall effective income tax rate was 31.8% and 33.3% for the three and nine months ended September 30, 2012, respectively, and 33.6% and 33.2% for the three and nine months ended September 30, 2011, respectively. The decrease in the effective tax rate for the three months ended September 30, 2012 is primarily due to refund claims filed in the current quarter.

As of September 30, 2012, the liability for income taxes associated with uncertain tax positions is $9.7 million, of which $3.9 million, if recognized would favorably affect the Company’s effective tax rate. As of December 31, 2011 the liability associated with uncertain tax positions was $8.2 million, of which $2.1 million, if recognized, would favorably affect the Company’s effective tax rate.

The Company includes interest and penalties related to uncertain tax positions in income tax expense. As of September 30, 2012 the total accrued interest and penalties are $2.6 million and $1.4 million, respectively. As of December 31, 2011 the total accrued interest and penalties were $2.8 million and $1.5 million, respectively.

The Internal Revenue Service is currently auditing the 2009 and 2010 tax years. With limited exception, the Company is no longer subject to examination by various U.S. and foreign taxing authorities for years before 2009.

At this time, the Company believes that it is reasonably possible that unrecognized tax benefits of approximately $1.1 million may change within the next 12 months due to the expiration of statutory review periods and current examinations.

v2.4.0.6

Segment Financial Information (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Segment Reporting Information [Line Items]

Sales to external customers $ 587,593 $ 498,840 $ 1,780,722 $ 1,432,998

Total sales 587,593 498,840 1,780,722 1,432,998

Income (loss) from operations 96,842 75,453 291,817 198,192

Interest expense and other, net (4,463) (5,293) (11,587) (12,720)

Income (loss) from operations before income taxes 92,379 70,160 280,230 185,472

Freight Segment [Member]

Segment Reporting Information [Line Items]

Sales to external customers 354,659 315,837 1,159,653 860,729

Intersegment sales/(elimination) 5,662 4,626 17,214 12,536

Total sales 360,321 320,463 1,176,867 873,265

Income (loss) from operations 75,702 60,709 234,734 160,682

Income (loss) from operations before income taxes 75,702 60,709 234,734 160,682

Transit Segment [Member]

Segment Reporting Information [Line Items]

Sales to external customers 232,934 183,003 621,069 572,269

Intersegment sales/(elimination) 3,231 2,955 8,659 4,989

Total sales 236,165 185,958 629,728 577,258

Income (loss) from operations 24,385 20,803 68,934 70,976

Income (loss) from operations before income taxes 24,385 20,803 68,934 70,976

Corporate Activities and Elimination [Member]

Segment Reporting Information [Line Items]

Intersegment sales/(elimination) (8,893) (7,581) (25,873) (17,525)

Total sales (8,893) (7,581) (25,873) (17,525)

Income (loss) from operations (3,245) (6,059) (11,851) (33,466)

Interest expense and other, net (4,463) (5,293) (11,587) (12,720)

Income (loss) from operations before income taxes $ (7,708) $ (11,352) $ (23,438) $ (46,186)

v2.4.0.6

Guarantor subsidiaries financial information - Additional information (Detail) (USD $)
In Millions, unless otherwise specified

Sep. 30, 2012

Senior Notes $ 150

v2.4.0.6

Liabilities Carried at Fair Value Measured on Recurring Basis (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Dec. 31, 2011

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Interest rate swap agreements $ 4,507 $ 1,442

Interest rate swap agreement [Member]

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Interest rate swap agreements 4,507 1,442

Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Interest rate swap agreements 4,507 1,442

Fair Value, Measurements, Recurring | Interest rate swap agreement [Member] | Fair Value, Inputs, Level 2

Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]

Interest rate swap agreements $ 4,507 $ 1,442

v2.4.0.6

FAIR VALUE MEASUREMENT (Tables)
9 Months Ended

Sep. 30, 2012

Liabilities Carried at Fair Value Measured on Recurring Basis

The following table provides the liabilities carried at fair value measured on a recurring basis as of September 30, 2012, which are included in other current liabilities on the Condensed Consolidated Balance sheet:

   Total Carrying
Value at
September 30,
2012    Fair Value Measurements at September 30, 2012 Using

In thousands
      Quoted Prices in
Active Markets for
Identical Assets
(Level 1)    Significant Other
Observable Inputs
(Level 2)    Significant
Unobservable
Inputs
(Level 3)

Interest rate swap agreements
   4,507       —    4,507       —









Total
   $ 4,507       $ —    $ 4,507       $ —

The following table provides the liabilities carried at fair value measured on a recurring basis as of December 31, 2011, which is included in other current liabilities on the Condensed Consolidated Balance sheet:

   Total Carrying
Value at
December 31,
2011    Fair Value Measurements at December 31, 2011 Using

In thousands
      Quoted Prices in
Active Markets for
Identical Assets
(Level 1)    Significant Other
Observable Inputs
(Level 2)    Significant
Unobservable
Inputs
(Level 3)

Interest rate swap agreements
   1,442       —         1,442       —









Total
   $ 1,442       $ —         $ 1,442       $ —

v2.4.0.6

Long Term Debt (Parenthetical) (Detail) (6.875% Senior Notes, Due 2013 [Member])
9 Months Ended

Sep. 30, 2012

6.875% Senior Notes, Due 2013 [Member]

Debt Instrument [Line Items]

Maturity date of debt instrument 2013

Debt Instrument, Interest Rate, Stated Percentage 6.875%

v2.4.0.6

SEGMENT INFORMATION
9 Months Ended

Sep. 30, 2012

SEGMENT INFORMATION

14. SEGMENT INFORMATION

Wabtec 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 business segments are:

Freight Segment primarily manufactures and services components for new and existing freight cars and locomotives, builds new switcher locomotives, rebuilds freight locomotives, supplies railway electronics, positive train control equipment, signal design and engineering services, friction products, and provides related heat exchange and cooling systems. Customers include large, publicly traded railroads, leasing companies, manufacturers of original equipment such as locomotives and freight cars, and utilities.

Transit Segment primarily manufactures and services components for new and existing passenger transit vehicles, typically subway cars and buses, builds new commuter locomotives, friction products, and refurbishes 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. Corporate activities include general corporate expenses, elimination of intersegment transactions, interest income and expense and other unallocated charges. Since certain administrative and other operating expenses and other items have not been allocated to business segments, the results in the following tables are not necessarily a measure computed in accordance with generally accepted accounting principles and may not be comparable to other companies.

Segment financial information for the three months ended September 30, 2012 is as follows:

In thousands
   Freight
Segment    Transit
Segment Corporate
Activities and
Elimination Total

Sales to external customers
   $ 354,659       $ 232,934    $ —      $ 587,593

Intersegment sales/(elimination)
   5,662       3,231 (8,893 ) —





Total sales
   $ 360,321       $ 236,165    $ (8,893 ) $ 587,593





Income (loss) from operations
   $ 75,702       $ 24,385    $ (3,245 ) $ 96,842

Interest expense and other, net
   —         —      (4,463 ) (4,463 )





Income (loss) from operations before income taxes
   $ 75,702       $ 24,385    $ (7,708 ) $ 92,379





Segment financial information for the three months ended September 30, 2011 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Corporate
Activities and
Elimination Total

Sales to external customers
   $ 315,837       $ 183,003       $ —      $ 498,840

Intersegment sales/(elimination)
   4,626       2,955       (7,581 ) —







Total sales
   $ 320,463       $ 185,958       $ (7,581 ) $ 498,840







Income (loss) from operations
   $ 60,709       $ 20,803       $ (6,059 ) $ 75,453

Interest expense and other, net
   —         —         (5,293 ) (5,293 )







Income (loss) from operations before income taxes
   $ 60,709       $ 20,803       $ (11,352 ) $ 70,160







Segment financial information for the nine months ended September 30, 2012 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Corporate
Activities and
Elimination Total

Sales to external customers
   $ 1,159,653       $ 621,069       $ —      $ 1,780,722

Intersegment sales/(elimination)
   17,214       8,659       (25,873 ) —







Total sales
   $ 1,176,867       $ 629,728       $ (25,873 ) $ 1,780,722







Income (loss) from operations
   $ 234,734       $ 68,934       $ (11,851 ) $ 291,817

Interest expense and other, net
   —         —         (11,587 ) (11,587 )







Income (loss) from operations before income taxes
   $ 234,734       $ 68,934       $ (23,438 ) $ 280,230







Segment financial information for the nine months ended September 30, 2011 is as follows:

In thousands
   Freight
Segment    Transit
Segment    Corporate
Activities and
Elimination Total

Sales to external customers
   $ 860,729       $ 572,269       $ —      $ 1,432,998

Intersegment sales/(elimination)
   12,536       4,989       (17,525 ) —







Total sales
   $ 873,265       $ 577,258       $ (17,525 ) $ 1,432,998







Income (loss) from operations
   $ 160,682       $ 70,976       $ (33,466 ) $ 198,192

Interest expense and other, net
   —         —         (12,720 ) (12,720 )







Income (loss) from operations before income taxes
   $ 160,682       $ 70,976       $ (46,186 ) $ 185,472







Sales by product are as follows:

   Three Months Ended
September 30,

In thousands
   2012    2011

Specialty Products & Electronics
   $ 264,094       $ 231,983

Remanufacturing, Overhaul & Build
   129,597       83,673

Brake Products
   127,027       121,372

Other Transit Products
   49,141       45,753

Other
   17,734       16,059





Total sales
   $ 587,593       $ 498,840





Sales by product are as follows:

   Nine Months Ended
September 30,

In thousands
   2012    2011

Specialty Products & Electronics
   $ 841,382       $ 622,857

Brake Products
   386,640       372,815

Remanufacturing, Overhaul & Build
   348,252       245,330

Other Transit Products
   149,941       145,637

Other
   54,507       46,359





Total sales
   $ 1,780,722       $ 1,432,998

v2.4.0.6

ACQUISITIONS (Tables)
9 Months Ended

Sep. 30, 2012

Summary of Preliminary Estimated Fair Values of the Assets Acquired and Liabilities Assumed

For the Bearward, Fulmer, Mors Smitt, Tec Tran and Winco acquisitions, the following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition. For the Brush Traction and ATP acquisitions, the following table summarizes the final fair value of the assets acquired and liabilities assumed at the date of acquisition.

   Brush Traction ATP    Bearward Fulmer Mors Smitt Tec Tran Winco

In thousands
   February 25,
2011 June 29,
2011    November 3,
2011 November 18,
2011 June 14,
2012 July 13,
2012 July 31,
2012

Current assets
   $ 19,558    $ —         $ 14,777    $ 4,203    $ 23,787    $ 1,955    $ 1,584

Property, plant & equipment
   8,862    —         4,498    1,636    6,960    116    47

Goodwill and other intangible assets
   30,816    21,100       43,990    8,409    85,354    6,811    7,401

Other assets
   —      —         53    —      944    —      —





Total assets acquired
   59,236    21,100       63,318    14,248    117,045    8,882    9,032

Total liabilities assumed
   (28,559 ) —         (19,532 ) (657 ) (27,057 ) (382 ) (5,376 )





Net assets acquired
   $ 30,677    $ 21,100       $ 43,786    $ 13,591    $ 89,988    $ 8,500    $ 3,656





Pro Forma Financial Information

The following unaudited pro forma financial information presents income statement results as if the acquisitions listed above, excluding LH, had occurred on January 1, 2011:

In thousands
   Three Months Ended
September 30, 2012    Three Months Ended
September 30, 2011    Nine Months Ended
September 30, 2012    Nine Months Ended
September 30, 2011

Net sales
   $ 588,939       $ 546,413       $ 1,820,046       $ 1,574,359

Gross profit
   171,818       163,340       529,695       469,767

Net income attributable to Wabtec shareholders
   63,263       53,278       188,655       139,987

Diluted earnings per share


As Reported
   $ 1.30       $ 0.96       $ 3.85       $ 2.56

Pro forma
   $ 1.31       $ 1.10       $ 3.90       $ 2.90

v2.4.0.6

Amortization Expense (Detail) (USD $)
In Thousands, unless otherwise specified

Sep. 30, 2012

Acquired Finite-Lived Intangible Assets [Line Items]

Remainder of 2012 $ 4,521

2013 13,467

2014 12,630

2015 11,872

2016 $ 11,715

v2.4.0.6

Acquisitions - Additional Information (Detail) (USD $)
9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2012

Trade Names [Member]

Oct. 01, 2012

Subsequent Event [Member]

Sep. 30, 2012

Customer Relationships [Member]

Sep. 30, 2012

License Agreement [Member]

Sep. 30, 2012

Noncompete Agreements [Member]

Sep. 30, 2012

Order or Production Backlog [Member]

Sep. 30, 2012

Fulmer [Member]

Nov. 18, 2011

Fulmer [Member]

Sep. 30, 2012

ATP [Member]

Jun. 29, 2011

ATP [Member]

Sep. 30, 2012

Brush Traction [Member]

Feb. 25, 2011

Brush Traction [Member]

Sep. 30, 2012

Bearward [Member]

Nov. 03, 2011

Bearward [Member]

Sep. 30, 2012

Tec Tran [Member]

Jul. 13, 2012

Tec Tran [Member]

Sep. 30, 2012

Mors Smitt [Member]

Jun. 14, 2012

Mors Smitt [Member]

Sep. 30, 2012

Winco [Member]

Jul. 31, 2012

Winco [Member]

Indefinite-lived Intangible Assets [Line Items]

Date of acquisition Oct. 01, 2012 Nov. 18, 2011 Jun. 29, 2011 Feb. 25, 2011 Nov. 03, 2011 Jul. 13, 2012 Jun. 14, 2012 Jul. 31, 2012

Purchase price $ 47,800,000 $ 13,600,000 $ 21,100,000 $ 30,700,000 $ 8,500,000 $ 90,000,000

Addition to goodwill 2,000,000 20,500,000 24,200,000 6,800,000 50,000,000 4,800,000

Business acquisition, net purchase price, net of cash 43,800,000 3,700,000

Goodwill tax deduction 0

Escrow deposits 15,300,000

Acquired intangible assets $ 94,800,000 $ 23,000,000 $ 63,100,000 $ 2,100,000 $ 1,000,000 $ 5,600,000

Average useful life, years 19 years 20 years 2 years

v2.4.0.6

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended

Sep. 30, 2012

Sep. 30, 2011

Sep. 30, 2012

Sep. 30, 2011

Net income attributable to Wabtec shareholders $ 62,994 $ 46,600 $ 186,967 $ 123,886

Foreign currency translation gain (loss) 11,916 (37,792) 6,298 (10,696)

Unrealized gain on foreign exchange contracts 200 251

Unrealized (loss) gain on interest rate swap contracts (903) 376 (3,064) 604

Pension benefit plans and post-retirement benefit plans (128) 2,571 2,158 3,273

Comprehensive income before income taxes 73,879 11,955 192,359 117,318

Income tax benefit (expense) related to components of other comprehensive income 333 (959) 425 (1,351)

Comprehensive income attributable to Wabtec shareholders $ 74,212 $ 10,996 $ 192,784 $ 115,967

v2.4.0.6

ACQUISITIONS
9 Months Ended

Sep. 30, 2012

ACQUISITIONS

3. ACQUISITIONS

The Company made the following acquisitions within the Transit Segment:

•
On October 1, 2012, subsequent to the close of our accounting quarter, the Company acquired LH Group (“LH”), a UK-based provider of maintenance and overhaul services for the passenger transit market, for a net purchase price of approximately $47.8 million, net of cash.

•
On July 13, 2012, the Company acquired Tec Tran Corp. and its affiliates (“Tec Tran”), the only U.S.-owned manufacturer of hydraulic braking systems for transit cars, based in North Carolina, for a net purchase price of approximately $8.5 million, net of cash, resulting in preliminary additional goodwill of $6.8 million, which will be deductible for tax purposes.

•
On June 14, 2012, the Company acquired Mors Smitt Holding (“Mors Smitt”), a leading manufacturer of electronic components for rail and industrial markets with operations in the Netherlands, the United Kingdom, the U.S., France, China and Hong-Kong, for a net purchase price of approximately $90.0 million, net of cash, resulting in preliminary additional goodwill of $50.0 million, none of which will be deductible for tax purposes.

•
On November 18, 2011, the Company acquired Fulmer Company (“Fulmer”), a leading manufacturer of motor components for rail, power generation and other industrial markets, for a net purchase price of $13.6 million, resulting in preliminary additional goodwill of $2.0 million, which will be deductible for tax purposes.

•
On June 29, 2011, the Company acquired an aftermarket transit parts business (“ATP”) from GE Transportation, a parts supply business for propulsion and control systems for the passenger transit car aftermarket in North America for a net purchase price of $21.1 million, resulting in no additional goodwill.

•
On February 25, 2011, the Company acquired Brush Traction Group (“Brush Traction”), a UK-based provider of locomotive overhauls, services and aftermarket components for a net purchase price of approximately $30.7 million, resulting in additional goodwill of $20.5 million, which will be deductible for tax purposes.

The Company made the following acquisitions within the Freight Segment:

•
On July 31, 2012, the Company acquired Winco Equipamentos Ferroviarios Ltda. (“Winco”), an established marketing and sales company with capabilities including value-added engineering and assembly, service, technical support and logistics, based in Brazil, for an initial net payment of approximately $3.7 million, net of cash, resulting in preliminary additional goodwill of $4.8 million, none of which will be deductible for tax purposes. In addition to the $3.7 million, the purchase agreement includes contingent consideration to be paid in future periods based on the achievement of certain financial results.

•
On November 3, 2011, the Company acquired Bearward Engineering (“Bearward”), a UK-based manufacturer of cooling systems and related equipment for power generation and other industrial markets, for a net purchase price of approximately $43.8 million, net of cash, resulting in preliminary additional goodwill of $24.2 million, none of which will be deductible for tax purposes.

The acquisitions listed above, excluding LH, include escrow deposits of $15.3 million, which act as security for indemnity and other claims in accordance with the purchase and related escrow agreements.

For the Bearward, Fulmer, Mors Smitt, Tec Tran and Winco acquisitions, the following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the date of the acquisition. For the Brush Traction and ATP acquisitions, the following table summarizes the final fair value of the assets acquired and liabilities assumed at the date of acquisition.

   Brush Traction ATP    Bearward Fulmer Mors Smitt Tec Tran Winco

In thousands
   February 25,
2011 June 29,
2011    November 3,
2011 November 18,
2011 June 14,
2012 July 13,
2012 July 31,
2012

Current assets
   $ 19,558    $ —         $ 14,777    $ 4,203    $ 23,787    $ 1,955    $ 1,584

Property, plant & equipment
   8,862    —         4,498    1,636    6,960    116    47

Goodwill and other intangible assets
   30,816    21,100       43,990    8,409    85,354    6,811    7,401

Other assets
   —      —         53    —      944    —      —





Total assets acquired
   59,236    21,100       63,318    14,248    117,045    8,882    9,032

Total liabilities assumed
   (28,559 ) —         (19,532 ) (657 ) (27,057 ) (382 ) (5,376 )





Net assets acquired
   $ 30,677    $ 21,100       $ 43,786    $ 13,591    $ 89,988    $ 8,500    $ 3,656





Of the allocation of $94.8 million of acquired intangible assets for the companies listed in the above table exclusive of goodwill, $63.1 million was assigned to customer relationships, $23.0 million was assigned to trade names, $2.1 million was assigned to a license agreement, $1.0 million was assigned to non-compete agreements and $5.6 million was assigned to customer backlog. The trade names are considered to have an indefinite useful life while the customer relationships’ average useful life is 19 years, the license agreement’s useful life is 20 years, and the non-compete agreements average useful life is two years.

The following unaudited pro forma financial information presents income statement results as if the acquisitions listed above, excluding LH, had occurred on January 1, 2011:

In thousands
   Three Months Ended
September 30, 2012    Three Months Ended
September 30, 2011    Nine Months Ended
September 30, 2012    Nine Months Ended
September 30, 2011

Net sales
   $ 588,939       $ 546,413       $ 1,820,046       $ 1,574,359

Gross profit
   171,818       163,340       529,695       469,767

Net income attributable to Wabtec shareholders
   63,263       53,278       188,655       139,987

Diluted earnings per share


As Reported
   $ 1.30       $ 0.96       $ 3.85       $ 2.56

Pro forma
   $ 1.31       $ 1.10       $ 3.90       $ 2.90

v2.4.0.6

Restricted Stock Activity and Incentive Stock Awards Activity (Detail) (USD $)
9 Months Ended

Sep. 30, 2012

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Weighted Average Grant Date Fair Value, Outstanding, beginning of period $ 44.04

Weighted Average Grant Date Fair Value, Granted $ 70.85

Weighted Average Grant Date Fair Value, Vested $ 35.73

Weighted Average Grant Date Fair Value, Adjustment for incentive stock awards expected to vest $ 60.61

Weighted Average Grant Date Fair Value, Canceled $ 42.96

Weighted Average Grant Date Fair Value, Outstanding, end of period $ 53.17

Granted 75,698

Canceled (26,717)

Restricted Stock And Units

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Outstanding, beginning of period 274,609

Granted 110,980

Vested (98,694)

Canceled (13,008)

Outstanding, end of period 273,887

Incentive Stock Awards

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Outstanding, beginning of period 646,362

Granted 118,660

Vested (122,079)

Adjustment for incentive stock awards expected to vest 45,784

Canceled (2,219)

Outstanding, end of period 686,508

v2.4.0.6

INVENTORIES (Tables)
9 Months Ended

Sep. 30, 2012

Components of Inventory, Net of Reserves

The components of inventory, net of reserves, were:

In thousands
   September 30,
2012    December 31,
2011

Raw materials
   $ 165,139       $ 154,885

Work-in-process
   135,152       110,179

Finished goods
   91,301       83,110





Total inventories
   $ 391,592       $ 348,174

v2.4.0.6

Business - Additional Information (Detail)
9 Months Ended

Sep. 30, 2012

Product Information [Line Items]

Number of countries where product found, minimum 100

Number of countries company operates 20

Revenues from customers outside the U.S. 50.00%

v2.4.0.6

COMMITMENTS AND CONTINGENCIES
9 Months Ended

Sep. 30, 2012

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

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. Further information and detail on these claims is described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, in Note 18 therein, filed on February 24, 2012. During the first nine months for 2012, there were no material changes to the information described in the Form 10-K.

The Company is also subject to litigation from time to time arising out of its operations in the ordinary course of business, including claims based on product liability, contracts, intellectual property, or other causes of action. Further information and detail on any potentially material litigation is as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, in Note 18 therein, filed on February 24, 2012. During the first nine months of 2012, there were no material changes to the information described in the Form 10-K.

The Company is also subject to other commitments and contingencies arising from environmental conditions or regulations as described in its Annual Report on Form 10-K for the year ended December 31, 2011, in Note 18 therein, filed on February 24, 2012. During the first nine months of 2012, there were no material changes to the information described in the Form 10-K.

Accounting Policies - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Fair Value, Option, Quantitative Disclosures [Line Items]
Unbilled accounts receivables	$ 92,500,000		$ 92,500,000		$ 58,900,000
Customer deposits	104,400,000		104,400,000		72,800,000
Provisions for loss contracts	9,900,000		9,900,000		9,300,000
Deferred pre-production costs	16,400,000		16,400,000		15,400,000
Interest rate swap agreements, notional amount	107,000,000		107,000,000
Fixed interest rate on bank debt	1.82%		1.82%
Interest rate swap agreement termination date			Dec. 31, 2012
Interest rate swap, accumulated other comprehensive loss	300,000		300,000
Interest rate on notional value			1.415%
Foreign exchange transaction gains (losses) recognized in other income (expense)	(1,468,000)	(1,795,000)	(427,000)	(2,061,000)
Forward starting interest rate swap agreement [Member]
Fair Value, Option, Quantitative Disclosures [Line Items]
Interest rate swap agreements, notional amount	150,000,000		150,000,000
Interest rate swap agreement termination date			Nov. 07, 2016
Current liability	4,100,000		4,100,000
Interest rate swap, accumulated other comprehensive loss	2,500,000		2,500,000
Interest rate swap agreement [Member]
Fair Value, Option, Quantitative Disclosures [Line Items]
Current liability	$ 400,000		$ 400,000

Employee Benefit Plans - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
United States Postretirement Benefit Plans [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Contribution to the plan	$ 1.6
International Postretirement Benefit Plans [Member]
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items]
Contribution to the plan	$ 6.4

Intangible Assets Other Than Goodwill and Trademarks (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Patents And Other [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, accumulated amortization	$ 34,650	$ 32,316
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, accumulated amortization	$ 28,509	$ 21,295

Changes in Carrying Amount of Goodwill (Detail) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
Goodwill [Line Items]
Balance at December 31, 2011	$ 587,531
Acquisition	61,559
Adjustment to preliminary purchase allocation	3,908
Foreign currency impact	3,935
Balance at September 30, 2012	656,933
Freight Segment [Member]
Goodwill [Line Items]
Balance at December 31, 2011	388,221
Acquisition	4,781
Adjustment to preliminary purchase allocation	2,754
Foreign currency impact	2,116
Balance at September 30, 2012	397,872
Transit Segment [Member]
Goodwill [Line Items]
Balance at December 31, 2011	199,310
Acquisition	56,778
Adjustment to preliminary purchase allocation	1,154
Foreign currency impact	1,819
Balance at September 30, 2012	$ 259,061

Fair Value of Each Option Grant Weighted Average Assumptions (Detail)	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Dividend yield	0.23%	0.08%
Risk-free interest rate	1.35%	2.96%
Stock price volatility	44.95%	45.60%
Expected life (years)	5 years	5 years

Long Term Debt (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Debt Instrument [Line Items]
Long-term debt	$ 432,897	$ 395,873
Less-current portion	43	68
Long-term portion	432,854	395,805
6.875% Senior Notes, Due 2013 [Member]
Debt Instrument [Line Items]
Long-term debt	150,000	150,000
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Long-term debt	282,000	245,000
Capital Lease Obligations [Member]
Debt Instrument [Line Items]
Long-term debt	$ 897	$ 873

Summary of Fair Value of Assets Acquired and Liabilities Assumed (Detail) (USD $) In Thousands, unless otherwise specified	Feb. 25, 2011 Brush Traction [Member]	Jun. 29, 2011 ATP [Member]	Nov. 03, 2011 Bearward [Member]	Nov. 18, 2011 Fulmer [Member]	Jun. 14, 2012 Mors Smitt [Member]	Jul. 13, 2012 Tec Tran [Member]	Jul. 31, 2012 Winco [Member]
Indefinite-lived Intangible Assets [Line Items]
Current assets	$ 19,558		$ 14,777	$ 4,203	$ 23,787	$ 1,955	$ 1,584
Property, plant & equipment	8,862		4,498	1,636	6,960	116	47
Goodwill and other intangible assets	30,816	21,100	43,990	8,409	85,354	6,811	7,401
Other assets			53		944
Total assets acquired	59,236	21,100	63,318	14,248	117,045	8,882	9,032
Total liabilities assumed	(28,559)		(19,532)	(657)	(27,057)	(382)	(5,376)
Net assets acquired	$ 30,677	$ 21,100	$ 43,786	$ 13,591	$ 89,988	$ 8,500	$ 3,656

Long Term Debt - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	9 Months Ended
	Sep. 30, 2012
Debt Instrument [Line Items]
Maximum borrowing capacity, net	$ 264.6
Current borrowing capacity, letters of credit	53.4
Long-term debt, percentage bearing variable interest rate	1.23%
Interest rate swap agreement, notional value	107.0
Fixed interest rate on bank debt	1.82%
Interest rate on notional value	1.415%
Minimum interest expense coverage ratio	3.0
Maximum debt to cash flow ratio	3.25
Forward starting interest rate swap agreement [Member]
Debt Instrument [Line Items]
Interest rate swap agreement, notional value	150.0
Interest Rate Swap [Member]
Debt Instrument [Line Items]
Debt instrument, effective issuance date	Jul. 31, 2013
Maturity date of debt instrument	2012-12-31
Debt instrument, termination date	2016-11-07
6.875% Senior Notes, Due 2013 [Member]
Debt Instrument [Line Items]
Maturity date of debt instrument	2013
Senior Notes issued	150.0
Debt Instrument, Interest Rate, Stated Percentage	6.875%
2011 Refinancing Credit Agreement [Member]
Debt Instrument [Line Items]
Debt instrument, effective issuance date	Nov. 07, 2011
Deferred financing cost	2.0
Maturity date of debt instrument	2016-11-07
Debt instrument, interest rate, effective percentage	0.50%
Debt instrument basis points spread on variable rate	100
2011 Refinancing Credit Agreement [Member] \| Base Rate [Member]
Debt Instrument [Line Items]
Debt instrument basis points spread on variable rate	0
2011 Refinancing Credit Agreement [Member] \| Base Rate [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Debt instrument basis points spread on variable rate	0
2011 Refinancing Credit Agreement [Member] \| Base Rate [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Debt instrument basis points spread on variable rate	75
2011 Refinancing Credit Agreement [Member] \| Alternative Rate [Member]
Debt Instrument [Line Items]
Debt instrument basis points spread on variable rate	100
2011 Refinancing Credit Agreement [Member] \| Alternative Rate [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Debt instrument basis points spread on variable rate	75
2011 Refinancing Credit Agreement [Member] \| Alternative Rate [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Debt instrument basis points spread on variable rate	175
2011 Refinancing Credit Agreement [Member] \| Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Revolving credit facility, amount	$ 600
Debt instrument maturity date period, years	5

Guarantor Subsidiaries Balance Sheet (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011	Sep. 30, 2011	Dec. 31, 2010
Condensed Financial Statements, Captions [Line Items]
Cash and cash equivalents	$ 282,055	$ 285,615	$ 221,136	$ 236,941
Accounts receivable	430,230	346,281
Inventories	391,592	348,174
Other current assets	80,172	75,712
Total current assets	1,184,049	1,055,782
Property, plant and equipment	229,147	222,022
Goodwill	656,933	587,531
Other intangibles	284,889	257,355
Other long term assets	41,024	36,263
Total Assets	2,396,042	2,158,953
Current liabilities	540,692	541,385
Long-term debt	432,854	395,805
Other long term liabilities	191,479	174,119
Total liabilities	1,165,025	1,111,309
Stockholders' equity	1,231,017	1,047,644
Total Liabilities and Shareholders' Equity	2,396,042	2,158,953
Parent Company [Member]
Condensed Financial Statements, Captions [Line Items]
Cash and cash equivalents	76,210	75,621	14,231	42,714
Accounts receivable	75	186
Other current assets	62,889	59,990
Total current assets	139,174	135,797
Property, plant and equipment	4,243	3,655
Goodwill	7,980	7,980
Investment in subsidiaries	3,070,357	2,675,378
Other long term assets	(10,340)	(9,946)
Total Assets	3,211,414	2,812,864
Current liabilities	48,977	72,396
Inter-company	1,427,896	1,222,650
Long-term debt	432,000	395,000
Other long term liabilities	71,524	75,174
Total liabilities	1,980,397	1,765,220
Stockholders' equity	1,231,017	1,047,644
Total Liabilities and Shareholders' Equity	3,211,414	2,812,864
Guarantor Subsidiaries [Member]
Condensed Financial Statements, Captions [Line Items]
Cash and cash equivalents	5,622	14,024	8,965	13,226
Accounts receivable	243,220	196,909
Inventories	270,873	250,280
Other current assets	6,500	5,989
Total current assets	526,215	467,202
Property, plant and equipment	125,031	123,182
Goodwill	407,324	399,419
Investment in subsidiaries	193,978	183,357
Other intangibles	166,620	174,351
Other long term assets	3,377	5,640
Total Assets	1,422,545	1,353,151
Current liabilities	326,916	282,671
Inter-company	(1,588,017)	(1,303,441)
Long-term debt	175	198
Other long term liabilities	31,658	33,790
Total liabilities	(1,229,268)	(986,782)
Stockholders' equity	2,651,813	2,339,933
Total Liabilities and Shareholders' Equity	1,422,545	1,353,151
Non-Guarantor Subsidiaries [Member]
Condensed Financial Statements, Captions [Line Items]
Cash and cash equivalents	200,223	195,970	197,940	181,001
Accounts receivable	186,935	149,186
Inventories	120,719	97,894
Other current assets	10,783	9,733
Total current assets	518,660	452,783
Property, plant and equipment	99,873	95,185
Goodwill	241,629	180,132
Other intangibles	118,269	83,004
Other long term assets	47,987	40,569
Total Assets	1,026,418	851,673
Current liabilities	164,799	186,318
Inter-company	160,121	80,791
Long-term debt	679	607
Other long term liabilities	88,297	65,155
Total liabilities	413,896	332,871
Stockholders' equity	612,522	518,802
Total Liabilities and Shareholders' Equity	1,026,418	851,673
Elimination [Member]
Condensed Financial Statements, Captions [Line Items]
Investment in subsidiaries	(3,264,335)	(2,858,735)
Total Assets	(3,264,335)	(2,858,735)
Stockholders' equity	(3,264,335)	(2,858,735)
Total Liabilities and Shareholders' Equity	$ (3,264,335)	$ (2,858,735)

Intangible Assets Other Than Goodwill and Trademarks (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	$ 158,772	$ 142,809
Patents And Other [Member]
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	11,799	14,849
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Accumulated amortization	$ 146,973	$ 127,960

Changes in Product Warranty Reserve (Detail) (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Warranties [Line Items]
Balance	$ 50,640	$ 35,513
Warranty expense	18,334	12,602
Acquisitions	494	12,008
Warranty claim payments	(11,971)	(12,921)
Balance	$ 57,497	$ 47,202

Stock Option Activity (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	9 Months Ended	12 Months Ended
	Sep. 30, 2012 Y	Sep. 30, 2012 Y
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Weighted Average Remaining Contractual Life, Outstanding	6 years 4 months 24 days	6 years 6 months
Weighted Average Remaining Contractual Life, Exercisable
Aggregate intrinsic value, Outstanding, beginning of period	$ 30,362
Aggregate intrinsic value, Granted	725
Aggregate intrinsic value, Exercised	(7,079)
Aggregate intrinsic value, Canceled	(1,224)	(1,224)
Aggregate intrinsic value, Outstanding, end of period	31,701	31,701
Aggregate intrinsic value, Exercisable	$ 23,592	$ 23,592
Weighted Average Exercise Price, Outstanding, beginning of period	$ 34.74
Weighted Average Exercise Price, Granted	$ 70.71
Weighted Average Exercise Price, Exercised	$ 24.01
Weighted Average Exercise Price, Canceled	$ 34.46
Weighted Average Exercise Price, Outstanding, end of period	$ 39.94	$ 39.94
Weighted Average Exercise Price, Exercisable	$ 32.95	$ 32.95
Options, Outstanding, beginning of period	862,392
Options, Granted	75,698
Options, Exercised	(125,788)
Options, Canceled	(26,717)
Options, Outstanding, end of period	785,585	785,585
Options, Exercisable	498,381	498,381

Components of Inventory Net of Reserves (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Inventory [Line Items]
Raw materials	$ 165,139	$ 154,885
Work-in-process	135,152	110,179
Finished goods	91,301	83,110
Total inventories	$ 391,592	$ 348,174

Components of Accumulated Other Comprehensive Loss (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Accumulated Other Comprehensive Income Loss [Line Items]
Foreign currency translation gain (loss)	$ 3,851	$ (2,447)
Unrealized loss on interest rate swap contracts, net of tax	(2,722)	(871)
Pension benefit plans and post retirement benefit plans, net of tax	(56,209)	(57,579)
Total accumulated comprehensive loss	$ (55,080)	$ (60,897)

Intangibles - Additional Information (Detail) (USD $)	3 Months Ended		9 Months Ended
Intangibles - Additional Information (Detail) (USD $)	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Dec. 31, 2011
Intangible Assets Disclosure [Line Items]
Goodwill	$ 656,933,000		$ 656,933,000		$ 587,531,000
Trademarks	126,100,000		126,100,000		114,600,000
Intangible assets, amortization expense	$ 3,900,000	$ 4,100,000	$ 10,300,000	$ 10,500,000
Patents [Member]
Intangible Assets Disclosure [Line Items]
Intangible assets, weighted average useful life, (years)			5 years
Customer Relationships [Member]
Intangible Assets Disclosure [Line Items]
Intangible assets, weighted average useful life, (years)			19 years
Intellectual Property Rights [Member]
Intangible Assets Disclosure [Line Items]
Intangible assets, weighted average useful life, (years)			17 years

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $)	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Cash dividends, per share	$ 0.11	$ 0.05

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Sep. 30, 2012	Dec. 31, 2011
Preferred stock, authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	66,174,767	66,174,767
Common stock, shares outstanding	47,887,204	47,946,360
Treasury stock, shares	18,287,563	18,228,407

Document and Entity Information	9 Months Ended
Document and Entity Information	Sep. 30, 2012	Oct. 26, 2012
Entity Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Trading Symbol	WAB
Entity Registrant Name	WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORP
Entity Central Index Key	0000943452
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		47,887,404

Liabilities Carried at Fair Value Measured on Recurring Basis (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012	Dec. 31, 2011
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	$ 4,507	$ 1,442
Interest rate swap agreement [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	4,507	1,442
Fair Value, Measurements, Recurring \| Fair Value, Inputs, Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	4,507	1,442
Fair Value, Measurements, Recurring \| Interest rate swap agreement [Member] \| Fair Value, Inputs, Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate swap agreements	$ 4,507	$ 1,442

Amortization Expense (Detail) (USD $) In Thousands, unless otherwise specified	Sep. 30, 2012
Acquired Finite-Lived Intangible Assets [Line Items]
Remainder of 2012	$ 4,521
2013	13,467
2014	12,630
2015	11,872
2016	$ 11,715

Acquisitions - Additional Information (Detail) (USD $)	9 Months Ended			9 Months Ended				9 Months Ended		9 Months Ended		9 Months Ended		9 Months Ended		9 Months Ended		9 Months Ended		9 Months Ended
Acquisitions - Additional Information (Detail) (USD $)	Sep. 30, 2012	Sep. 30, 2012 Trade Names [Member]	Oct. 01, 2012 Subsequent Event [Member]	Sep. 30, 2012 Customer Relationships [Member]	Sep. 30, 2012 License Agreement [Member]	Sep. 30, 2012 Noncompete Agreements [Member]	Sep. 30, 2012 Order or Production Backlog [Member]	Sep. 30, 2012 Fulmer [Member]	Nov. 18, 2011 Fulmer [Member]	Sep. 30, 2012 ATP [Member]	Jun. 29, 2011 ATP [Member]	Sep. 30, 2012 Brush Traction [Member]	Feb. 25, 2011 Brush Traction [Member]	Sep. 30, 2012 Bearward [Member]	Nov. 03, 2011 Bearward [Member]	Sep. 30, 2012 Tec Tran [Member]	Jul. 13, 2012 Tec Tran [Member]	Sep. 30, 2012 Mors Smitt [Member]	Jun. 14, 2012 Mors Smitt [Member]	Sep. 30, 2012 Winco [Member]	Jul. 31, 2012 Winco [Member]
Indefinite-lived Intangible Assets [Line Items]
Date of acquisition	Oct. 01, 2012							Nov. 18, 2011		Jun. 29, 2011		Feb. 25, 2011		Nov. 03, 2011		Jul. 13, 2012		Jun. 14, 2012		Jul. 31, 2012
Purchase price			$ 47,800,000						$ 13,600,000		$ 21,100,000		$ 30,700,000				$ 8,500,000		$ 90,000,000
Addition to goodwill									2,000,000				20,500,000		24,200,000		6,800,000		50,000,000		4,800,000
Business acquisition, net purchase price, net of cash															43,800,000						3,700,000
Goodwill tax deduction																					0
Escrow deposits	15,300,000
Acquired intangible assets	$ 94,800,000	$ 23,000,000		$ 63,100,000	$ 2,100,000	$ 1,000,000	$ 5,600,000
Average useful life, years				19 years	20 years	2 years

Restricted Stock Activity and Incentive Stock Awards Activity (Detail) (USD $)	9 Months Ended
	Sep. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted Average Grant Date Fair Value, Outstanding, beginning of period	$ 44.04
Weighted Average Grant Date Fair Value, Granted	$ 70.85
Weighted Average Grant Date Fair Value, Vested	$ 35.73
Weighted Average Grant Date Fair Value, Adjustment for incentive stock awards expected to vest	$ 60.61
Weighted Average Grant Date Fair Value, Canceled	$ 42.96
Weighted Average Grant Date Fair Value, Outstanding, end of period	$ 53.17
Granted	75,698
Canceled	(26,717)
Restricted Stock And Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, beginning of period	274,609
Granted	110,980
Vested	(98,694)
Canceled	(13,008)
Outstanding, end of period	273,887
Incentive Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, beginning of period	646,362
Granted	118,660
Vested	(122,079)
Adjustment for incentive stock awards expected to vest	45,784
Canceled	(2,219)
Outstanding, end of period	686,508

Business - Additional Information (Detail)	9 Months Ended
Business - Additional Information (Detail)	Sep. 30, 2012
Product Information [Line Items]
Number of countries where product found, minimum	100
Number of countries company operates	20
Revenues from customers outside the U.S.	50.00%