GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

The obligations under the Company's 2016 Notes, 2013 Notes and Revolving Credit Facility and Term Loan are fully and unconditionally guaranteed by all U.S. subsidiaries as guarantors. Each guarantor is 100% owned by the parent company. 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 for December 31, 2018:



In thousands	Parent		Guarantors			Non-Guarantors			Elimination			Consolidated
Cash, cash equivalents, and restricted cash	$	1,782,682	$	(119	)	$	559,791		$	—		$	2,342,354
Receivables, net	106,815		61,513			978,450			—			1,146,778
Inventories	149,622		69,116			626,148			—			844,886
Current assets - other	11,884		690			103,075			—			115,649
Total current assets	2,051,003		131,200			2,267,464			—			4,449,667
Property, plant and equipment	51,551		24,755			487,431			—			563,737
Goodwill	25,275		283,241			2,088,028			—			2,396,544
Investment in subsidiaries	6,707,979		4,022,107			—			(10,730,086		)	—
Other intangibles, net	29,254		78,547			1,022,079			—			1,129,880
Other long term assets	8,775		149			100,482			—			109,406
Total assets	$	8,873,837	$	4,539,999		$	5,965,484		$	(10,730,086	)	$	8,649,234
Current liabilities	$	264,630	$	91,004		$	1,291,056		$	—		$	1,646,690
Inter-company	1,947,504		(1,436,222		)	(511,282		)	—			—
Long-term debt	3,779,627		—			13,147			—			3,792,774
Long-term liabilities - other	16,945		48,714			275,036			—			340,695
Total liabilities	6,008,706		(1,296,504		)	1,067,957			—			5,780,159
Shareholders' equity	2,865,131		5,836,503			4,893,583			(10,730,086		)	2,865,131
Non-controlling interest	—		—			3,944			—			3,944
Total shareholders' equity	$	2,865,131	$	5,836,503		$	4,897,527		$	(10,730,086	)	$	2,869,075
Total Liabilities and Shareholders' Equity	$	8,873,837	$	4,539,999		$	5,965,484		$	(10,730,086	)	$	8,649,234

Balance Sheet for December 31, 2017:



In thousands	Parent		Guarantors			Non-Guarantors			Elimination			Consolidated
Cash and cash equivalents	$	933	$	625		$	231,843		$	—		$	233,401
Receivables, net	77,046		59,166			1,030,575			—			1,166,787
Inventories	120,937		46,626			575,071			—			742,634
Current assets - other	1,142		563			120,586			—			122,291
Total current assets	200,058		106,980			1,958,075			—			2,265,113
Property, plant and equipment	52,532		26,492			494,948			—			573,972
Goodwill	25,274		283,242			2,151,587			—			2,460,103
Investment in subsidiaries	6,517,205		2,440,665			—			(8,957,870		)	—
Other intangibles, net	30,575		81,037			1,092,820			—			1,204,432
Other long term assets	17,414		(23,892		)	82,838			—			76,360
Total assets	$	6,843,058	$	2,914,524		$	5,780,268		$	(8,957,870	)	$	6,579,980
Current liabilities	$	196,827	$	77,284		$	1,299,219		$	—		$	1,573,330
Inter-company	2,121,546		(1,307,410		)	(814,136		)	—			—
Long-term debt	1,661,771		14			161,518			—			1,823,303
Long-term liabilities - other	54,046		20,594			280,175			—			354,815
Total liabilities	4,034,190		(1,209,518		)	926,776			—			3,751,448
Shareholders' equity	2,808,868		4,124,042			4,833,828			(8,957,870		)	2,808,868
Non-controlling interest	—		—			19,664			—			19,664
Total shareholders' equity	$	2,808,868	$	4,124,042		$	4,853,492		$	(8,957,870	)	$	2,828,532
Total Liabilities and Shareholders' Equity	$	6,843,058	$	2,914,524		$	5,780,268		$	(8,957,870	)	$	6,579,980

Income Statement for the Year Ended December 31, 2018:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	671,035		$	483,058		$	3,442,229		$	(232,775	)	$	4,363,547
Cost of sales	(495,090		)	(304,286		)	(2,462,536		)	132,250			(3,129,662		)
Gross profit (loss)	175,945			178,772			979,693			(100,525		)	1,233,885
Total operating expenses	(172,978		)	(57,274		)	(530,196		)	—			(760,448		)
Income (loss) from operations	2,967			121,498			449,497			(100,525		)	473,437
Interest (expense) income, net	(110,801		)	12,794			(14,228		)	—			(112,235		)
Other income (expense), net	13,452			20			(7,092		)	—			6,380
Equity earnings (loss)	396,944			369,376			—			(766,320		)	—
Pretax income (loss)	302,562			503,688			428,177			(866,845		)	367,582
Income tax expense	(7,618		)	(3,299		)	(64,962		)	—			(75,879		)
Net income (loss)	294,944			500,389			363,215			(866,845		)	291,703
Less: Net income attributable to noncontrolling interest	—			—			3,241			—			3,241
Net income (loss) attributable to Wabtec shareholders	$	294,944		$	500,389		$	366,456		$	(866,845	)	$	294,944

Comprehensive income (loss) attributable to Wabtec shareholders	$	295,774		$	500,389		$	154,035		$	(866,845	)	$	83,353

Income Statement for the Year Ended December 31, 2017:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	577,397		$	398,220		$	3,035,464		$	(129,325	)	$	3,881,756
Cost of sales	(440,911		)	(255,792		)	(2,218,460		)	98,720			(2,816,443		)
Gross profit (loss)	136,486			142,428			817,004			(30,605		)	1,065,313
Total operating expenses	(114,199		)	(50,902		)	(479,133		)	—			(644,234		)
Income (loss) from operations	22,287			91,526			337,871			(30,605		)	421,079
Interest (expense) income, net	(76,823		)	10,916			(11,977		)	—			(77,884		)
Other income (expense), net	10,020			274			(1,426		)	—			8,868
Equity earnings (loss)	416,068			317,614			—			(733,682		)	—
Pretax income (loss)	371,552			420,330			324,468			(764,287		)	352,063
Income tax (expense) income	(109,294		)	18,762			759			—			(89,773		)
Net income (loss)	262,258			439,092			325,227			(764,287		)	262,290
Less: Net income attributable to noncontrolling interest	—			—			(29		)	—			(29		)
Net income (loss) attributable to Wabtec shareholders	$	262,258		$	439,092		$	325,198		$	(764,287	)	$	262,261

Comprehensive income (loss) attributable to Wabtec shareholders	$	263,907		$	439,092		$	658,162		$	(764,287	)	$	596,874

Income Statement for the Year Ended December 31, 2016:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	641,809		$	435,864		$	1,995,465		$	(141,950	)	$	2,931,188
Cost of sales	(473,700		)	(280,973		)	(1,350,401		)	98,125			(2,006,949		)
Gross (loss) profit	168,109			154,891			645,064			(43,825		)	924,239
Total operating expenses	(142,817		)	(50,361		)	(274,454		)	—			(467,632		)
Income (loss) from operations	25,292			104,530			370,610			(43,825		)	456,607
Interest (expense) income, net	(38,843		)	9,294			(20,749		)	—			(50,298		)
Other income (expense), net	25,254			(1,689		)	(17,037		)	—			6,528
Equity earnings (loss)	322,650			292,184			—			(614,834		)	—
Pretax income (loss)	334,353			404,319			332,824			(658,659		)	412,837
Income tax expense	(29,466		)	(52,308		)	(17,659		)	—			(99,433		)
Net income (loss)	304,887			352,011			315,165			(658,659		)	313,404
Less: Net income attributable to noncontrolling interest	—			—			(8,517		)	—			(8,517		)
Net income (loss) attributable to Wabtec shareholders	$	304,887		$	352,011		$	306,648		$	(658,659	)	$	304,887

Comprehensive income (loss) attributable to Wabtec shareholders	$	305,180		$	352,011		$	203,469		$	(658,659	)	$	202,001

Condensed Statement of Cash Flows for the year ended December 31, 2018:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used in) provided by operating activities	$	(87,122	)	$	130,125		$	372,193		$	(100,525	)	$	314,671
Net cash used in investing activities	(16,808		)	(2,024		)	(128,455		)	—			(147,287		)
Net cash provided by (used in) financing activities	1,885,679			(128,845		)	120,752			100,525			1,978,111
Effect of changes in currency exchange rates	—			—			(36,542		)	—			(36,542		)
Increase (decrease) in cash	1,781,749			(744		)	327,948			—			2,108,953
Cash and cash equivalents, beginning of year	933			625			231,843			—			233,401
Cash, cash equivalents, and restricted cash, end of year	$	1,782,682		$	(119	)	$	559,791		$	—		$	2,342,354

Condensed Statement of Cash Flows for the year ended December 31, 2017:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used in) provided by operating activities	$	(49,231	)	$	130,298		$	138,349		$	(30,605	)	$	188,811
Net cash used in investing activities	(11,156		)	(3,357		)	(1,018,961		)	—			(1,033,474		)
Net cash provided by (used in) financing activities	58,798			(127,542		)	(59,292		)	30,605			(97,431		)
Effect of changes in currency exchange rates	—			—			32,263			—			32,263
(Decrease) increase in cash	(1,589		)	(601		)	(907,641		)	—			(909,831		)
Cash, cash equivalents, and restricted cash, beginning of year	2,522			1,226			1,139,484			—			1,143,232
Cash and cash equivalents, end of year	$	933		$	625		$	231,843		$	—		$	233,401

Condensed Statement of Cash Flows for the year ended December 31, 2016:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used in) provided by operating activities	$	(44,611	)	$	142,839		$	396,127		$	(43,825	)	$	450,530
Net cash used in (provided by) investing activities	(829,783		)	(2,653		)	599,470			—			(232,966		)
Net cash provided by (used in) financing activities	876,916			(147,586		)	(250,184		)	43,825			522,971
Effect of changes in currency exchange rates	—			—			(26,436		)	—			(26,436		)
Increase (decrease) in cash	2,522			(7,400		)	718,977			—			714,099
Cash, cash equivalents, and restricted cash, beginning of year	—			8,626			420,507			—			429,133
Cash, cash equivalents, and restricted cash, end of year	$	2,522		$	1,226		$	1,139,484		$	—		$	1,143,232