Portec Rail Products (PRPX) Receives Fault Detection and Management Orders from China

January 11, 2010 7:10 AM EST
Portec Rail Products, Inc. (NASDAQ: PRPX) today announced that it has increased its expansion into China, as the company recently received new customer orders for its Fault Detection and Friction Management product groups from China. Portec Rail has had a steadily-growing presence in China for its Friction Management products, and has now penetrated the Chinese market with its Fault Detection product group.

Portec Rail is a leader in the North American heavy-haul rail freight markets for friction management with its Total Friction Management(TM) program and Salient Systems' Class I dominance in Wheel Impact Load Detector (WILD) systems. The company is focused on matching this expertise to the Chinese market, which provides tremendous growth opportunity for Portec Rail.

The Friction Management product group has increased its market presence through a significant increase in Chinese market sales in 2009 from the prior year for the train-mounted Kelsan LCF(TM) Solid-Stick lubrication products and HPF(TM) Solid -Stick tread friction modifier while new orders were also received for friction management wayside application systems that included both gage face lubrication and the KELTRACK(R) top of rail friction control product. Another milestone achievement for Portec Rail is Salient Systems' entrance into the Chinese market by receiving orders from Shenhua Energy Company Limited for new WILD systems that include optional Weigh-In-Motion (WIM) and Hunting Truck Detection (HTD) capabilities as well as orders for the Rail Stress Monitor (RSM) product. These systems are to be installed on a coal carrying heavy-haul rail line.

Mr. Richard Jarosinski, President and Chief Executive Officer, stated, "These orders for a variety of our products reflect the success of our efforts to enter the expanding Chinese rail infrastructure system. Our dedicated employees, along with our sales agents in China, have worked diligently to understand this unique customer base of our Chinese business partners. We have focused our efforts on participating in key industry forums and in-country tradeshows and in the publication of research papers and promotion of customer visits to North America. All of these activities have resulted in significant progress towards making Portec Rail Products, Inc. a meaningful brand name in the Chinese rail system marketplace, which we hope will continue to grow in stature as our products and services become more widely used." Mr. Jarosinski continued, "The Chinese rail service market offers significant growth potential in both heavy-haul freight and passenger service. It has been recently announced that the Chinese will be spending a new record of $120.6 billion in rail expansion efforts this year. It also has been reported that the period from 2010 to 2012 will be a key period for the rail modernization effort in China according to the Ministry of Railways. Rail transportation investment includes major capacity expansions for some of the country's existing coal railways as well as the planned construction of several new coal railways by companies such as Shenhua Energy Company Limited. In addition, major expansion is also set for high speed passenger rail service lines. Our growth in China's rail industry should position us well as China continues to expand and modernize its railways. We are focused and dedicated to increasing the use of both our friction management and wayside data collection systems in China and other key international markets."

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