GUARANTOR SUBSIDIARIES FINANCIAL INFORMATION

The obligations under the Company's 2016 Notes, 2013 Notes, and Revolving Credit Facility and Term Loan are full 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 March 31, 2017:



In thousands	Parent		Guarantors			Non-Guarantors		Elimination			Consolidated
Cash and cash equivalents	$	2,528	$	7,172		$	270,479	$	—		$	280,179
Receivables, net	71,106		207,705			772,731		—			1,051,542
Inventories	131,680		135,067			437,134		—			703,881
Current assets - other	34,516		3,923			92,192		—			130,631
Total current assets	239,830		353,867			1,572,536		—			2,166,233
Property, plant and equipment	49,179		127,726			347,154		—			524,059
Goodwill	25,275		537,949			1,625,279		—			2,188,503
Investment in subsidiaries	5,656,301		1,450,967			—		(7,107,268		)	—
Other intangibles, net	31,566		255,986			801,560		—			1,089,112
Other long term assets	32,504		6,312			24,176		—			62,992
Total assets	$	6,034,655	$	2,732,807		$	4,370,705	$	(7,107,268	)	$	6,030,899
Current liabilities	$	173,300	190,455			$	1,107,652	—			$	1,471,407
Inter-company	1,779,360		(1,889,230		)	109,870		—			—
Long-term debt	1,685,389		47			97,188		—			1,782,624
Long-term liabilities - other	45,015		101,756			261,329		—			408,100
Total liabilities	3,683,064		(1,596,972		)	1,576,039		—			3,662,131
Shareholders' equity	2,351,591		4,330,922			2,776,346		(7,107,268		)	2,351,591
Non-controlling interest	—		(1,143		)	18,320		—			17,177
Total shareholders' equity	$	2,351,591	$	4,329,779		$	2,794,666	$	(7,107,268	)	$	2,368,768
Total Liabilities and Shareholders' Equity	$	6,034,655	$	2,732,807		$	4,370,705	$	(7,107,268	)	$	6,030,899

Balance Sheet for December 31, 2016:



In thousands	Parent		Guarantors			Non-Guarantors		Elimination			Consolidated
Cash and cash equivalents	$	2,522	$	9,496		$	386,466	$	—		$	398,484
Receivables, net	79,041		202,779			660,688		—			942,508
Inventories	120,042		128,076			410,392		—			658,510
Current assets - other	52,576		(17,844		)	833,397		—			868,129
Total current assets	254,181		322,507			2,290,943		—			2,867,631
Property, plant and equipment	49,031		126,661			342,684		—			518,376
Goodwill	25,275		477,472			1,576,018		—			2,078,765
Investment in subsidiaries	5,388,613		1,325,150			—		(6,713,763		)	—
Other intangibles, net	31,897		204,512			817,451		—			1,053,860
Other long term assets	9,592		(1,914		)	54,708		—			62,386
Total assets	$	5,758,589	$	2,454,388		$	5,081,804	$	(6,713,763	)	$	6,581,018
Current liabilities	$	194,983	196,956			$	1,054,700	—			$	1,446,639
Inter-company	1,562,399		(1,848,777		)	286,378		—			—
Long-term debt	1,761,933		58			976		—			1,762,967
Long-term liabilities - other	33,298		74,977			286,312		—			394,587
Total liabilities	3,552,613		(1,576,786		)	1,628,366		—			3,604,193
Shareholders' equity	2,205,976		4,032,250			2,681,514		(6,713,763		)	2,205,977
Non-controlling interest	—		(1,076		)	771,924		—			770,848
Total shareholders' equity	$	2,205,976	$	4,031,174		$	3,453,438	$	(6,713,763	)	$	2,976,825
Total Liabilities and Shareholders' Equity	$	5,758,589	$	2,454,388		$	5,081,804	$	(6,713,763	)	$	6,581,018

Income Statement for the Three Months Ended March 31, 2017:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	144,544		$	258,712		$	544,388		$	(31,610	)	$	916,034
Cost of sales	(98,950		)	(167,607		)	(403,966		)	24,196			(646,327		)
Gross profit (loss)	45,594			91,105			140,422			(7,414		)	269,707
Total operating expenses	(24,293		)	(29,871		)	(100,685		)	—			(154,849		)
Income (loss) from operations	21,301			61,234			39,737			(7,414		)	114,858
Interest (expense) income, net	(14,611		)	2,160			(5,261		)	—			(17,712		)
Other income (expense), net	13,081			(1,260		)	(9,502		)	—			2,319
Equity earnings (loss)	68,285			11,942			—			(80,227		)	—
Pretax income (loss)	88,056			74,076			24,974			(87,641		)	99,465
Income tax expense	(14,165		)	(141		)	(13,155		)	—			(27,461		)
Net income (loss)	73,891			73,935			11,819			(87,641		)	72,004
Less: Net income attributable to noncontrolling interest	—			—			1,885			—			1,885
Net income (loss) attributable to Wabtec shareholders	$	73,891		$	73,935		$	13,704		$	(87,641	)	$	73,889

Comprehensive income (loss) attributable to Wabtec shareholders	$	74,747		$	73,935		$	60,801		$	(87,641	)	$	121,842

Income Statement for the Three Months Ended March 31, 2016:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net Sales	$	176,986		$	318,152		$	315,984		$	(39,091	)	$	772,031
Cost of sales	(129,081		)	(190,366		)	(220,126		)	22,722			(516,851		)
Gross profit (loss)	47,905			127,786			95,858			(16,369		)	255,180
Total operating expenses	(37,876		)	(32,351		)	(42,772		)	—			(112,999		)
(Loss) income from operations	10,029			95,435			53,086			(16,369		)	142,181
Interest (expense) income, net	(6,669		)	1,725			73			—			(4,871		)
Other income (expense), net	10,816			(4,480		)	(6,182		)	—			154
Equity earnings (loss)	113,022			38,699			—			(151,721		)	—
Pretax income (loss)	127,198			131,379			46,977			(168,090		)	137,464
Income tax expense	(33,035		)	(1,000		)	(9,266		)	—			(43,301		)
Net income (loss)	94,163			130,379			37,711			(168,090		)	94,163
Less: Net income attributable to noncontrolling interest	—			—			—			—			—
Net income attributable to Wabtec shareholders	$	94,163		$	130,379		$	37,711		$	(168,090	)	$	94,163

Comprehensive income (loss) attributable to Wabtec shareholders	$	93,932		$	130,378		$	65,565		$	(168,090	)	$	121,785

Condensed Statement of Cash Flows for the Three Months Ended March 31, 2017:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash (used in) provided by operating activities	$	(8,705	)	$	(5,829	)	$	(4,148	)	$	(7,414	)	$	(26,096	)
Net cash used in investing activities	(5,124		)	(68,173		)	10,221			—			(63,076		)
Net cash provided by (used in) financing activities	13,835			71,678			(132,400		)	7,414			(39,473		)
Effect of changes in currency exchange rates	—			—			10,340			—			10,340
Increase (decrease) in cash	6			(2,324		)	(115,987		)	—			(118,305		)
Cash, beginning of period	2,522			9,496			386,466			—			398,484
Cash, end of period	$	2,528		$	7,172		$	270,479		$	—		$	280,179

Condensed Statement of Cash Flows for the Three Months Ended March 31, 2016:



In thousands	Parent			Guarantors			Non-Guarantors			Elimination			Consolidated
Net cash provided by (used in) operating activities	$	(11,340	)	$	81,479		$	21,796		$	(16,369	)	$	75,566
Net cash used in investing activities	(3,234		)	(2,303		)	(3,093		)	—			(8,630		)
Net cash (used in) provided by financing activities	20,229			(71,084		)	(5,551		)	16,369			(40,037		)
Effect of changes in currency exchange rates	—			—			9,684			—			9,684
(Decrease) increase in cash	5,655			8,092			22,836			—			36,583
Cash, beginning of period	—			13,157			213,034			—			226,191
Cash, end of period	$	5,655		$	21,249		$	235,870		$	—		$	262,774