##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
  Washington, D.C.
    20549
 Form 10-Q
  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended
    September 30, 2010OrTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934   Commission File Number 000-51562
  AMERICAN COMMERCIAL LINES
    INC.
 (Exact name of registrant as
    specified in its charter)
  
  Delaware

75-3177794(State or Other Jurisdiction
    of
    Incorporation or Organization)

(I.R.S. Employer
    Identification No.)1701 East Market Street
    Jeffersonville, Indiana(Address of Principal
    Executive Offices)

47130(Zip Code)   (812) 288-0100
 (Registrants telephone
    number, including area code)
  Not applicable
 (Former name, former address and
    former fiscal year, if changed since last report)
  þ o
  Regulation S-T o o
  12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ




---



##### 





AMERICAN
    COMMERCIAL LINES INC.
  QUARTERLY
    REPORT ON
    FORM 10-Q
 FOR THE
    QUARTERLY PERIOD ENDED SEPTEMBER 30, 2010
  TABLE OF
    CONTENTS
   
 PagePART I FINANCIAL INFORMATIONItem 1:


Financial Statements (unaudited)


2Condensed Consolidated Statements of
    Operations


2Condensed Consolidated Balance Sheets


3Condensed Consolidated Statements of Cash
    Flows


4Condensed Consolidated Statement of
    Stockholders Equity


5Notes to Condensed Consolidated Financial
    Statements


6Item 2:


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


26Item 3:


Quantitative and Qualitative Disclosures About
    Market Risk


50Item 4:


Controls and Procedures


50PART II OTHER INFORMATIONItem 1:


Legal Proceedings


50Item 1A:


Risk Factors


53Item 2:


Unregistered Sales of Securities and Use of
    Proceeds


63Item 3:


Defaults on Senior Securities


63Item 4:


Removed and Reserved


63Item 6:


Exhibits


63Signatures


63Certification by CEOCertification by CFOCertification by CEOCertification by CFOEX-10.1EX-31.1EX-31.2EX-32.1EX-32.2   1




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##### Table of Contents



PART I 
    FINANCIAL INFORMATION ITEM 1.
    FINANCIAL
    STATEMENTS  AMERICAN
    COMMERCIAL LINES INC.
  CONDENSED CONSOLIDATED STATEMENTS OF
    OPERATIONS
  Quarter Ended September 30,


Nine Months Ended September 30,2010


2009


2010


2009(Unaudited)(In thousands, except shares and per share amounts)RevenuesTransportation and Services

$
165,762


$
143,690


$
455,038


$
448,768Manufacturing


41,524



64,198



64,845



170,348Revenues


207,286



207,888



519,883



619,116Cost of SalesTransportation and Services


133,529



118,359



391,826



393,744Manufacturing


41,486



57,172



63,480



147,497Cost of Sales


175,015



175,531



455,306



541,241Gross Profit


32,271



32,357



64,577



77,875Selling, General and Administrative Expenses


11,989



18,300



34,174



55,592Operating Income


20,282



14,057



30,403



22,283Other Expense (Income)Interest Expense


9,815



10,470



29,434



30,803Debt Retirement Costs






17,659







17,659Other, Net


(181
)


(364
)


(342
)


(851
)Other Expense


9,634



27,765



29,092



47,611Income (Loss) from Continuing Operations before Taxes


10,648



(13,708
)


1,311



(25,328
)Income Taxes (Benefit)


5,583



(4,940
)


1,089



(9,149
)Income (Loss) from Continuing Operations


5,065



(8,768
)


222



(16,179
)Discontinued Operations, Net of Tax






(3,404
)


(2
)


(5,219
)Net Income (Loss)

$
5,065


$
(12,172
)

$
220


$
(21,398
)Basic Earnings (Loss) per Common Share:Income (Loss) from continuing operations

$
0.39


$
(0.69
)

$
0.02


$
(1.27
)Loss from discontinued operations, net of tax






(0.27
)






(0.41
)Basic Earnings (Loss) per Common Share

$
0.39


$
(0.96
)

$
0.02


$
(1.68
)Earnings (Loss) per Common Share  Assuming
    Dilution:Income (Loss) from continuing operations

$
0.39


$
(0.69
)

$
0.02


$
(1.27
)Loss from discontinued operations, net of tax






(0.27
)






(0.41
)Earnings (Loss) per Common Share  Assuming
    Dilution:

$
0.39


$
(0.96
)

$
0.02


$
(1.68
)Weighted Average Shares OutstandingBasic


12,836,041



12,715,120



12,802,889



12,705,308Diluted


13,155,083



12,715,120



13,011,214



12,705,308    2




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  CONDENSED CONSOLIDATED BALANCE
    SHEETS
  September 30,


December 31,2010


2009(Unaudited)(In thousands, except shares and per share amounts)ASSETSCurrent AssetsCash and Cash Equivalents

$
10,341


$
1,198Accounts Receivable, Net


78,445



93,295Inventory


47,790



39,070Deferred Tax Asset


3,360



3,791Assets Held for Sale


1,703



3,531Prepaid Expenses and Other Current Assets


32,893



23,879Total Current Assets


174,532



164,764Properties, Net


518,922



521,068Investment in Equity Investees


4,641



4,522Other Assets


29,272



33,536Total Assets

$
727,367


$
723,890LIABILITIESCurrent LiabilitiesAccounts Payable

$
33,659


$
34,163Accrued Payroll and Fringe Benefits


19,722



18,283Deferred Revenue


16,845



13,928Accrued Claims and Insurance Premiums


12,175



16,947Accrued Interest


5,929



13,098Current Portion of Long Term Debt






114Customer Deposits


250



1,309Other Liabilities


24,529



31,825Total Current Liabilities


113,109



129,667Long Term Debt


344,788



345,419Pension and Post Retirement Liabilities


32,490



31,514Deferred Tax Liability


59,259



40,133Other Long Term Liabilities


6,270



6,567Total Liabilities


555,916



553,300STOCKHOLDERS EQUITYCommon stock; authorized 50,000,000 shares at $.01 par
    value; 16,052,025 and 15,898,596 shares issued and
    outstanding as of September 30, 2010 and December 31,
    2009, respectively


160



159Treasury Stock 3,210,897 and 3,179,274 shares at
    September 30, 2010 and December 31, 2009, respectively


(314,049
)


(313,328
)Other Capital


301,882



299,486Retained Earnings


184,082



183,862Accumulated Other Comprehensive (Loss) Income


(624
)


411Total Stockholders Equity


171,451



170,590Total Liabilities and Stockholders Equity

$
727,367


$
723,890    3




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  CONDENSED CONSOLIDATED STATEMENT OF CASH
    FLOWS
  Nine Months Ended September 30,2010


2009(Unaudited)(In thousands)OPERATING ACTIVITIESNet Income (Loss)

$
220


$
(21,398
)Adjustments to Reconcile Net Income (Loss) to Net Cash Provided
    by Operating Activities:Depreciation and Amortization


35,118



40,664Debt Retirement Costs






17,659Debt Issuance Cost Amortization


3,978



5,818Deferred Taxes


19,936



(7,231
)Gain on Property Dispositions/Impairment of Assets Held for Sale


(7,357
)


(17,431
)Share-Based Compensation


3,094



6,672Other Operating Activities


5,735



4,206Changes in Operating Assets and Liabilities:Accounts Receivable


12,547



46,710Inventory


(7,645
)


24,148Other Current Assets


(10,376
)


18,631Accounts Payable


2,400



(22,692
)Accrued Interest


(7,103
)


5,673Other Current Liabilities


(8,106
)


(17,638
)Net Cash Provided by Operating Activities


42,441



83,791INVESTING ACTIVITIESProperty Additions


(37,577
)


(18,404
)Proceeds from Property Dispositions


7,337



27,625Proceeds from Government Grant


2,302



Other Investing Activities


1,167



(2,491
)Net Cash (Used in) Provided by Investing Activities


(26,771
)


6,730FINANCING ACTIVITIESFormer Revolving Credit Facility Repayments






(418,550
)Current Revolving Credit Facility Borrowings


(1,518
)


212,994Restricted Cash






(23,000
)2017 Senior Note Borrowings






200,000Discount on 2017 Senior Note Borrowings






(9,638
)Bank Overdrafts on Operating Accounts


(2,905
)


(8,784
)Debt Issue Costs


(153
)


(40,427
)Tax Expense of Share-Based Compensation


(1,208
)


(2,093
)Exercise of Stock Options


510



Acquisition of Treasury Stock


(721
)


(416
)Other Financing Activities


(532
)


Net Cash Used in Financing Activities


(6,527
)


(89,914
)Net Increase in Cash and Cash Equivalents


9,143



607Cash and Cash Equivalents at Beginning of Period


1,198



1,217Cash and Cash Equivalents at End of Period

$
10,341


$
1,824    4




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  CONDENSED CONSOLIDATED STATEMENT OF
    STOCKHOLDERS EQUITY
  AccumulatedOtherCommon Stock


Treasury


Other


Retained


ComprehensiveShares


Amount


Stock


Capital


Earnings


Income(Loss)


Total(Unaudited)(Shares and dollars in thousands)Balance at December 31, 2009


12,719


$
159


$
(313,328
)

$
299,486


$
183,862


$
411


$
170,590Share-based Compensation














3,094











3,094Tax Expense of Share-based Compensation














(1,208
)










(1,208
)Exercise of Stock Options


59











510











510Issuance of Restricted Stock Units and Performances Shares


95



1







(1
)










Acquisition of Treasury Stock


(32
)






(721
)














(721
)Comprehensive Income:Net Income


















220







220Net change in fuel swaps designated as cash flow hedging
    instrument, net of tax






















(1,035
)


(1,035
)Other














1











1Total Comprehensive Income





$



$



$
1


$
220


$
(1,035
)

$
(814
)Balance at September 30, 2010


12,841


$
160


$
(314,049
)

$
301,882


$
184,082


$
(624
)

$
171,451    5




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS
    (Unaudited)
    (Dollars in thousands, except as otherwise indicated)
  Note 1.
    Reporting
    Entity and Accounting Policies        Form 10-Q Regulation S-X. sub-lease
    No. 2009-01,
 6




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      No. 2010-06,
  Form 10-K
    Note 2.
    Stockholders
    Equity  one-for-four
   7




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    September 30,


December 31,2010


2009Minimum pension liability, net of $2,847 tax benefit

$
(4,748
)

$
(4,748
)Minimum post retirement liability, net of $1,745 tax provision


2,909



2,909Gain on fuel hedge, net of tax provision of $980 and $1,791,
    respectively.


1,215



2,250$
(624
)

$
411     Note 3.
    Earnings
    Per Share      performance-to-date
 8




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Quarter Ended


Nine Months EndedSeptember 30,


September 30,2010


2009


2010


2009Weighted average common shares outstanding (used to calculate
    basic earnings per share)


12,836,041



12,715,120



12,802,889



12,705,308Shares if all dilutive potential common shares outstanding
    during the period were exercised


319,042







208,325



Shares used to calculate diluted EPS


13,155,083



12,715,120



13,011,214



12,705,308   Note 4.
    Debt  September 30,


December 31,2010


2009Revolving Credit Facility

$
153,000


$
154,5182017 Senior Notes


200,000



200,000Less Original Issue Discount


(8,212
)


(9,099
)Elliott Bay Note






114Total Debt


344,788



345,533Less Current Portion of Long Term Debt






114Long Term Debt

$
344,788


$
345,419        9




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Note 5.
    Inventory    September 30,


December 31,2010


2009Raw Materials

$
18,291


$
5,142Work in Process


5,247



12,230Parts and Supplies


24,252



21,698$
47,790


$
39,070   Note 6.
    Income
    Taxes     10




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 7.
    Employee
    Benefit Plans    Quarter Ended


Nine Months EndedSeptember 30,


September 30,2010


2009


2010


2009Pension Components:Service cost

$
1,122


$
1,342


$
3,366


$
4,026Interest cost


2,606



2,486



7,818



7,458Expected return on plan assets


(3,130
)


(3,095
)


(9,390
)


(9,285
)Amortization of unrecognized losses


14



14



42



42Net periodic benefit cost

$
612


$
747


$
1,836


$
2,241Post-retirement Components:Service cost

$
3


$
5


$
9


$
15Interest cost


69



104



207



312Amortization of net gain


(331
)


(184
)


(993
)


(552
)Adjustment for prior benefit payment overstatement






27







81Net periodic benefit cost

$
(259
)

$
(48
)

$
(777
)

$
(144
)   Note 8.
    Business
    Segments    Form 10-K
      11




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##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Reportable Segments


All Other


IntersegmentTransportation


Manufacturing


Segments(1)


Eliminations


TotalQuarter ended September 30, 2010Total revenue

$
163,868


$
41,617


$
2,076


$
(275
)

$
207,286Intersegment revenues


182



93







(275
)


Revenue from external customers


163,686



41,524



2,076







207,286Operating expenseMaterials, supplies and other


57,229















57,229Rent


5,182















5,182Labor and fringe benefits


31,430















31,430Fuel


29,726















29,726Depreciation and amortization


10,294















10,294Taxes, other than income taxes


2,612















2,612Gain on disposition of equipment


(3,764
)














(3,764
)Cost of goods sold






41,486



820







42,306Total cost of sales


132,709



41,486



820







175,015Selling, general & administrative


10,232



635



1,122







11,989Total operating expenses


142,941



42,121



1,942







187,004Operating income (loss)

$
20,745


$
(597
)

$
134


$



$
20,282   Reportable Segments


All Other


IntersegmentTransportation


Manufacturing


Segments(1)


Eliminations


TotalQuarter ended September 30, 2009Total revenue

$
142,231


$
68,304


$
1,575


$
(4,222
)

$
207,888Intersegment revenues


106



4,106



10



(4,222
)


Revenue from external customers


142,125



64,198



1,565







207,888Operating expenseMaterials, supplies and other


58,939















58,939Rent


5,379















5,379Labor and fringe benefits


28,249















28,249Fuel


28,134















28,134Depreciation and amortization


12,068















12,068Taxes, other than income taxes


3,329















3,329Gain on disposition of equipment


(18,333
)














(18,333
)Cost of goods sold






57,172



594







57,766Total cost of sales


117,765



57,172



594







175,531Selling, general & administrative


14,444



2,853



1,003







18,300Total operating expenses


132,209



60,025



1,597







193,831Operating income (loss)

$
9,916


$
4,173


$
(32
)

$



$
14,057   12




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Reportable Segments


All Other


IntersegmentTransportation


Manufacturing


Segments(1)


Eliminations


TotalNine Months ended September 30, 2010Total revenue

$
449,510


$
86,117


$
6,032


$
(21,776
)

$
519,883Intersegment revenues


504



21,272







(21,776
)


Revenue from external customers


449,006



64,845



6,032







519,883Operating expenseMaterials, supplies and other


159,652















159,652Rent


15,571















15,571Labor and fringe benefits


91,507















91,507Fuel


88,735















88,735Depreciation and amortization


32,368















32,368Taxes, other than income taxes


8,946















8,946Gain on disposition of equipment


(7,357
)














(7,357
)Cost of goods sold






63,480



2,404







65,884Total cost of sales


389,422



63,480



2,404







455,306Selling, general & administrative


28,873



1,924



3,377







34,174Total operating expenses


418,295



65,404



5,781







489,480Operating income (loss)

$
30,711


$
(559
)

$
251


$



$
30,403   Reportable Segments


All Other


IntersegmentTransportation


Manufacturing


Segments(1)


Eliminations


TotalNine Months ended September 30, 2009Total revenue

$
443,690


$
184,159


$
5,462


$
(14,195
)

$
619,116Intersegment revenues


297



13,811



87



(14,195
)


Revenue from external customers


443,393



170,348



5,375







619,116Operating expenseMaterials, supplies and other


170,440















170,440Rent


16,334















16,334Labor and fringe benefits


86,492















86,492Fuel


92,052















92,052Depreciation and amortization


36,622















36,622Taxes, other than income taxes


10,508















10,508Gain on disposition of equipment


(20,630
)














(20,630
)Cost of goods sold






147,497



1,926







149,423Total cost of sales


391,818



147,497



1,926







541,241Selling, general & administrative


48,233



4,008



3,351







55,592Total operating expenses


440,051



151,505



5,277







596,833Operating income

$
3,342


$
18,843


$
98


$



$
22,283     1)
    
    Financial data for a segment below the reporting threshold is
    attributable to a segment that provides architectural design
    services that was acquired in 2007. 13




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 9.
    Financial
    Instruments and Risk Management    Fair Value ofMeasurements atReporting Date UsingMarkets for IdenticalDescription

9/30/2010

Assets (Level 1)Fuel Price Swaps

$
2,615


$
2,615     Gallons


DollarsFuel Price Swaps at December 31, 2009


17,928


$
4,7791st Quarter 2009 Fuel Hedge Expense


(5,302
)


(981
)1st Quarter 2009 Changes


3,001



5462nd Quarter 2010 Fuel Hedge Expense


(3,881
)


(814
)2nd Quarter 2010 Changes


3,087



(2,397
)3rd Quarter 2010 Fuel Hedge Expense


(4,547
)


(205
)3rd Quarter 2010 Changes


3,550



1,687Fuel Price Swaps at September 30, 2010


13,836


$
2,615   Note 10.
    Contingencies     14




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        12-Local
  Leonard Becker v. American
    Commercial Lines, Inc. et. al. and/or
  Note 11.
    Exit
    Activities     15




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Date


AmountHouston rent accrual at March 31, 2009





$
976Initial office closure estimate


1Q 2009



2,130Additional office closure accrual


2Q 2009



175Additional office closure accrual


3Q 2009



350Additional office closure accrual


4Q 2009



1,000Rent payments (April  December 2009)






(522
)Balance at December 31, 2009






4,109Additional office closure accrual


2Q 2010



133Write-off Houston fixed assets and moving expenses


2Q 2010



(2,044
)Lease termination costs


3Q 2010



(1,624
)Asset sales


3Q 2010



55Rent payments (January  September 2010)






(492
)Balance at September 30, 2010





$
137   Note 12.
    Share-Based
    Compensation    Note 13.
    Acquisitions
    and Dispositions   16




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Note 14.
    Subsequent
    Event    Note 15.
    Debtor
    Guarantor Financial Statements   17




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Statement of Operations for the Quarter Ended September 30,
    2010
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)RevenuesTransportation and Services

$



$



$
163,686


$
2,076


$



$
165,762Manufacturing










41,524











41,524Revenues










205,210



2,076







207,286Cost of SalesTransportation and Services










132,709



820







133,529Manufacturing










41,486











41,486Cost of Sales










174,195



820







175,015Gross Profit










31,015



1,256







32,271Selling, General and Administrative Expenses






114



10,753



1,122







11,989Operating (Loss) Income






(114
)


20,262



134







20,282Other Expense (Income)Interest Expense






6,729



3,086











9,815Other, Net


(5,065
)


(17,491
)


(185
)






22,560



(181
)Other Expense


(5,065
)


(10,762
)


2,901







22,560



9,634Income from Continuing Operations Before Income Taxes


5,065



10,648



17,361



134



(22,560
)


10,648Income Taxes






5,583















5,583Income from Continuing Operations


5,065



5,065



17,361



134



(22,560
)


5,065Discontinued Operations, Net of Tax






















Net Income

$
5,065


$
5,065


$
17,361


$
134


$
(22,560
)

$
5,065  18




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Statement of Operations for the Quarter Ended September 30,
    2009
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)RevenuesTransportation and Services

$



$



$
142,125


$
1,575


$
(10
)

$
143,690Manufacturing










64,198











64,198Revenues










206,323



1,575



(10
)


207,888Cost of SalesTransportation and Services










117,765



604



(10
)


118,359Manufacturing










57,172











57,172Cost of Sales










174,937



604



(10
)


175,531Gross Profit










31,386



971







32,357Selling, General and Administrative Expenses






109



17,188



1,003







18,300Operating (Loss) Income






(109
)


14,198



(32
)






14,057Other Expense (Income)Interest Expense






6,155



4,315











10,470Debt Retirement Expenses










17,659











17,659Other, Net


12,172



12,898



(357
)






(25,077
)


(364
)Other Expense


12,172



19,053



21,617







(25,077
)


27,765Loss from Continuing Operations Before Income Taxes


(12,172
)


(19,162
)


(7,419
)


(32
)


25,077



(13,708
)Income Tax Benefit






(4,939
)


(1
)










(4,940
)Loss from Continuing Operations


(12,172
)


(14,223
)


(7,418
)


(32
)


25,077



(8,768
)Discontinued Operations, Net of Tax






2,051







(5,455
)






(3,404
)Net Loss

$
(12,172
)

$
(12,172
)

$
(7,418
)

$
(5,487
)

$
25,077


$
(12,172
)  19




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Statement of Operations for the Nine Months Ended
    September 30, 2010
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)RevenuesTransportation and Services

$



$



$
449,006


$
6,032


$



$
455,038Manufacturing










64,845











64,845Revenues










513,851



6,032







519,883Cost of SalesTransportation and Services










389,422



2,404







391,826Manufacturing










63,480











63,480Cost of Sales










452,902



2,404







455,306Gross Profit










60,949



3,628







64,577Selling, General and Administrative Expenses






325



30,472



3,377







34,174Operating (Loss) Income






(325
)


30,477



251







30,403Other Expense (Income)Interest Expense






20,185



9,249











29,434Other, Net


(220
)


(21,819
)


(342
)






22,039



(342
)Other Expense


(220
)


(1,634
)


8,907







22,039



29,092Income from Continuing Operations Before Income Taxes


220



1,309



21,570



251



(22,039
)


1,311Income Taxes






1,089















1,089Income from Continuing Operations


220



220



21,570



251



(22,039
)


222Discontinued Operations, Net of Tax














(2
)






(2
)Net Income

$
220


$
220


$
21,570


$
249


$
(22,039
)

$
220  20




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Statement of Operations for the Nine Months Ended
    September 30, 2009
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)RevenuesTransportation and Services

$



$



$
443,393


$
5,462


$
(87
)

$
448,768Manufacturing










170,348











170,348Revenues










613,741



5,462



(87
)


619,116Cost of SalesTransportation and Services










391,818



2,013



(87
)


393,744Manufacturing










147,497











147,497Cost of Sales










539,315



2,013



(87
)


541,241Gross Profit










74,426



3,449







77,875Selling, General and Administrative Expenses






271



51,970



3,351







55,592Operating (Loss) Income






(271
)


22,456



98







22,283Other Expense (Income)Interest Expense






6,155



24,648











30,803Debt Retirement Expenses










17,659











17,659Other, Net


21,398



27,194



(671
)


(1
)


(48,771
)


(851
)Other Expense


21,398



33,349



41,636



(1
)


(48,771
)


47,611(Loss) Income from Continuing Operations Before Income
    Taxes


(21,398
)


(33,620
)


(19,180
)


99



48,771



(25,328
)Income Taxes (Benefit)






(9,169
)


(1
)


21







(9,149
)(Loss) Income from Continuing Operations


(21,398
)


(24,451
)


(19,179
)


78



48,771



(16,179
)Discontinued Operations, Net of Tax






3,053







(8,272
)






(5,219
)Net Loss

$
(21,398
)

$
(21,398
)

$
(19,179
)

$
(8,194
)

$
48,771


$
(21,398
)  21




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Balance Sheet at September 30, 2010
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)ASSETSCurrent AssetsCash and Cash Equivalents

$



$



$
9,505


$
836


$



$
10,341Accounts Receivable, Net


(34,467
)


97,531



6,632



8,749







78,445Inventory










47,790











47,790Deferred Tax Asset






3,360















3,360Assets Held for Sale










1,703











1,703Prepaid Expenses and Other Current Assets






13,963



18,691



239







32,893Total Current Assets


(34,467
)


114,854



84,321



9,824







174,532Properties, Net










518,728



194







518,922Investment in Subsidiaries


205,918



342,891



1,692







(550,501
)


Investment in Equity Investees










4,641











4,641Other Assets






4,993



20,278



4,001







29,272Total Assets

$
171,451


$
462,738


$
629,660


$
14,019


$
(550,501
)

$
727,367LIABILITIESCurrent LiabilitiesAccounts Payable

$



$



$
33,579


$
80


$



$
33,659Accrued Payroll and Fringe Benefits










19,033



689







19,722Deferred Revenue










16,820



25







16,845Accrued Claims and Insurance Premiums










12,175











12,175Accrued Interest






5,208



721











5,929Current Portion of Long Term Debt






















Customer Deposits










250











250Other Liabilities






566



23,829



134







24,529Total Current Liabilities






5,774



106,407



928







113,109Long Term Debt






191,787



153,001











344,788Pension and Post Retirement Liabilities










32,490











32,490Deferred Tax Liability






59,259















59,259Other Long Term Liabilities










6,258



12







6,270Total Liabilities






256,820



298,156



940







555,916STOCKHOLDERS EQUITYCommon stock


160



















160Treasury Stock


(314,049
)


















(314,049
)Other Capital


301,882



22,460



1,608



25,747



(49,815
)


301,882Retained Earnings


184,082



184,082



330,642



(12,668
)


(502,056
)


184,082Accumulated Other Comprehensive Loss


(624
)


(624
)


(746
)






1,370



(624
)Total Stockholders Equity


171,451



205,918



331,504



13,079



(550,501
)


171,451Total Liabilities and Stockholders Equity

$
171,451


$
462,738


$
629,660


$
14,019


$
(550,501
)

$
727,367  22




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Balance Sheet at December 31, 2009
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(In thousands)ASSETSCurrent AssetsCash and Cash Equivalents

$



$



$
940


$
258


$



$
1,198Accounts Receivable, Net


(37,351
)


118,850



1,932



9,864







93,295Inventory










39,070











39,070Deferred Tax Asset






3,791















3,791Assets Held for Sale










3,531











3,531Prepaid Expenses and Other Current Assets






(1
)


23,673



207







23,879Total Current Assets


(37,351
)


122,640



69,146



10,329







164,764Properties, Net










520,825



243







521,068Investment in Subsidiaries


207,941



322,917



1,694







(532,552
)


Investment in Equity Investees










4,522











4,522Other Assets






5,399



23,971



4,166







33,536Total Assets

$
170,590


$
450,956


$
620,158


$
14,738


$
(532,552
)

$
723,890LIABILITIESCurrent LiabilitiesAccounts Payable

$



$
16


$
33,424


$
723


$



$
34,163Accrued Payroll and Fringe Benefits










17,331



952







18,283Deferred Revenue










13,928











13,928Accrued Claims and Insurance Premiums










16,947











16,947Accrued Interest






12,014



1,084











13,098Current Portion of Long Term Debt














114







114Customer Deposits










1,309











1,309Other Liabilities






(49
)


31,768



106







31,825Total Current Liabilities






11,981



115,791



1,895







129,667Long Term Debt






190,901



154,518











345,419Pension and Post Retirement Liabilities










31,514











31,514Deferred Tax Liability






40,133















40,133Other Long Term Liabilities










6,554



13







6,567Total Liabilities






243,015



308,377



1,908







553,300STOCKHOLDERS EQUITYCommon stock


159



















159Treasury Stock


(313,328
)


















(313,328
)Other Capital


299,486



23,668



1,607



25,747



(51,022
)


299,486Retained Earnings


183,862



183,862



309,074



(12,917
)


(480,019
)


183,862Accumulated Other Comprehensive Income


411



411



1,100







(1,511
)


411Total Stockholders Equity


170,590



207,941



311,781



12,830



(532,552
)


170,590Total Liabilities and Stockholders Equity

$
170,590


$
450,956


$
620,158


$
14,738


$
(532,552
)

$
723,890  23




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Statement of Cash Flows for the Nine Months Ended
    September 30, 2010
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)OPERATING ACTIVITIES:Net Income

$
220


$
220


$
21,570


$
249


$
(22,039
)

$
220Adjustments to Reconcile Net Loss to Net Cash Provided by
    Operating Activities:Depreciation and Amortization










34,866



252







35,118Debt Issuance Cost Amortization






1,435



2,543











3,978Deferred Taxes






19,936















19,936Gain on Property Dispositions










(7,357
)










(7,357
)Share-Based Compensation










3,023



71







3,094Net Income of Subsidiaries


(220
)


(21,819
)










22,039



Other Operating Activities










5,731



4







5,735Changes in Operating Assets and Liabilities:Accounts Receivable


211



21,318



(9,937
)


955







12,547Inventory










(7,645
)










(7,645
)Other Current Assets






(13,532
)


3,188



(32
)






(10,376
)Accounts Payable






(16
)


3,059



(643
)






2,400Accrued Interest






(6,805
)


(364
)


66







(7,103
)Other Current Liabilities






615



(8,397
)


(324
)






(8,106
)Net Cash Provided by Operating Activities


211



1,352



40,280



598







42,441INVESTING ACTIVITIES:Property Additions










(37,557
)


(20
)






(37,577
)Proceeds from Property Dispositions










7,337











7,337Proceeds from Government Grant










2,302











2,302Other Investing Activities










1,167











1,167Net Cash Used in Investing Activities










(26,751
)


(20
)






(26,771
)FINANCING ACTIVITIES:Revolving Credit Facility Borrowings










(1,518
)










(1,518
)Bank Overdrafts on Operating Accounts










(2,905
)










(2,905
)Debt Issue Costs






(144
)


(9
)










(153
)Tax Expense of Share-Based Compensation






(1,208
)














(1,208
)Exercise of Stock Options


510



















510Acquisition of Treasury Stock


(721
)


















(721
)Other Financing Activities










(532
)










(532
)Net Cash Used in Financing Activities


(211
)


(1,352
)


(4,964
)










(6,527
)Net Increase in Cash and Cash Equivalents










8,565



578







9,143Cash and Cash Equivalents at Beginning of Period










940



258







1,198Cash and Cash Equivalents at End of Period

$



$



$
9,505


$
836


$



$
10,341  24




---



##### Table of Contents



AMERICAN
    COMMERCIAL LINES INC.
  NOTES TO
    CONDENSED CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Combining
    Statement of Cash Flows for the Nine Months Ended
    September 30, 2009
  Parent





Subsidiary


Non-





CombinedGuarantor


Issuer


Guarantors


Guarantors


Eliminations


Totals(Unaudited)(In thousands)OPERATING ACTIVITIES:Net Loss

$
(21,398
)

$
(21,398
)

$
(19,179
)

$
(8,194
)

$
48,771


$
(21,398
)Adjustments to Reconcile Net Loss to Net Cash Provided by
    Operating Activities:Depreciation and Amortization










39,264



1,400







40,664Debt Retirement Costs










17,659











17,659Debt Issuance Cost Amortization






390



5,428











5,818Deferred Taxes






(7,231
)














(7,231
)Gain on Property Dispositions/Impairment of Assets Held for Sale










(17,431
)










(17,431
)Share-Based Compensation










6,420



252







6,672Net Loss from Subsidiaries


21,398



27,196



177







(48,771
)


Other Operating Activities










(782
)


4,988







4,206Changes in Operating Assets and LiabilitiesAccounts Receivable, Net


416



(185,698
)


223,536



8,456







46,710Inventory










24,136



12







24,148Other Current Assets










18,395



236







18,631Accounts Payable










(18,327
)


(4,365
)






(22,692
)Accrued Interest






5,764



(70
)


(21
)






5,673Other Current Liabilities






(2,465
)


(12,221
)


(2,952
)






(17,638
)Net Cash Provided by (Used in) Operating Activities


416



(183,442
)


267,005



(188
)






83,791INVESTING ACTIVITIES:Property Additions










(18,300
)


(104
)






(18,404
)Proceeds from Property Dispositions










27,625











27,625Other Investing Activities










(2,491
)










(2,491
)Net Cash Provided by (Used in) Investing Activities










6,834



(104
)






6,730FINANCING ACTIVITIES:Former Revolving Credit Facility Repayments










(418,550
)










(418,550
)Current Revolving Credit Facility Borrowings










212,994











212,994Restricted Cash










(23,000
)










(23,000
)2017 Senior Note Borrowings






200,000















200,000Discount on 2017 Senior Note Borrowings






(9,638
)














(9,638
)Bank Overdrafts on Operating Accounts










(8,784
)










(8,784
)Debt Amendment Fees






(4,827
)


(35,600
)










(40,427
)Tax Expense of Share-Based Compensation






(2,093
)














(2,093
)Acquisition of Treasury Stock


(416
)


















(416
)Net Cash (Used in) Provided by Financing Activities


(416
)


183,442



(272,940
)










(89,914
)Net Increase (Decrease) in Cash and Cash Equivalents










899



(292
)






607Cash and Cash Equivalents at Beginning of Period










704



513







1,217Cash and Cash Equivalents at End of Period

$



$



$
1,603


$
221


$



$
1,824  25




---



##### Table of Contents



ITEM 2.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS (MD&A)  This MD&A includes certain forward-looking
    statements that involve many risks and uncertainties. When
    used, words such as anticipate, expect,
    believe, intend, may be,
    will be and similar words or phrases, or the
    negative thereof, unless the context requires otherwise, are
    intended to identify forward-looking statements. These
    forward-looking statements are based on managements
    present expectations and beliefs about future events. As with
    any projection or forecast, these statements are inherently
    susceptible to uncertainty and changes in circumstances. The
    Company is under no obligation to, and expressly disclaims any
    obligation to, update or alter its forward-looking statements
    whether as a result of such changes, new information, subsequent
    events or otherwise.
  See the risk factors included in Item 1A of this report
    for a detailed discussion of important factors that could cause
    actual results to differ materially from those reflected in such
    forward-looking statements. The potential for actual results to
    differ materially from such forward-looking statements should be
    considered in evaluating our outlook.
  INTRODUCTION
    Overview.
  Results of Operations.
  Liquidity and Capital Resources.
  Changes in Accounting Standards.
  Critical Accounting Policies. Form 10-K
  Quantitative and Qualitative Disclosures about Market
    Risk. Form 10-K
  OVERVIEW
  Our
    Business
   26




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##### Table of Contents



The
    Industry
  Transportation Industry:
     27




---



##### Table of Contents



ton-miles,
  
  Source:
  The Manufacturing Industry:
  Recent
    Business Development
   28




---



##### Table of Contents



Consolidated
    Financial Overview
                  Segment
    Overview
    Transportation
   29




---



##### Table of Contents



ton-miles ton-miles, ton-miles
        ton-miles ton-mile
  ton-miles ton-miles
    Revenue
    by Commodity ($ in millions) 3Q 2010, 3Q 2009, 3Q 2008
  
 30




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##### Table of Contents



quarter-over-quarter ton-miles net-of-hedge-impact
 31




---



##### Table of Contents



Key
    Operating Statistics
  Three


% Change to


Nine


% Change toMonths Ended


Prior Year Quarter


Months Ended


Prior Year YTDSeptember 30, 2010


Increase (Decrease)


September 30, 2010


Increase (Decrease)Ton-miles
    (000s):Total dry


7,266,921



(2.6
)%


21,018,481



(11.5
)%Total liquid


533,522



16.1
%


1,517,079



17.2
%Total affreightment
    ton-miles


7,800,443



(1.5
)%


22,535,560



(10.0
)%Total non-affreightment
    ton-miles


711,434



(13.6
)%


2,062,366



(12.0
)%Total
    ton-miles


8,511,877



(2.7
)%


24,597,926



(10.2
)%Average
    ton-miles
    per affreightment barge


3,386



3.1
%


9,656



(6.1
)%Rates per ton mile:Dry rate per
    ton-mile






20.8
%






15.7
%Fuel neutral dry rate per
    ton-mile






17.5
%






12.1
%Liquid rate per
    ton-mile






7.4
%






(1.7
)%Fuel neutral liquid rate per-ton mile






1.5
%






(6.9
)%Overall rate per
    ton-mile

$
15.10



20.4
%

$
14.16



15.7
%Overall fuel neutral rate per
    ton-mile

$
14.62



16.7
%

$
13.67



11.7
%Revenue per average barge operated

$
67,057



19.8
%

$
182,523



6.4
%Fuel price and volume data:Fuel price

$
2.19



8.6
%

$
2.16



10.8
%Fuel gallons


13,597



(2.7
)%


41,092



(13.0
)%Revenue data (in thousands):Affreightment revenue

$
117,575



18.4
%

$
318,488



3.9
%Towing


8,751



(7.5
)%


26,821



(15.2
)%Charter and day rate


16,859



6.6
%


49,180



1.3
%Demurrage


12,043



23.8
%


29,092



(13.0
)%Other


8,458



8.1
%


25,425



9.3
%Total non-affreightment revenue


46,111



7.7
%


130,518



(4.7
)%Total transportation segment revenue

$
163,686



15.2
%

$
449,006



1.3
%  32




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##### Table of Contents



Barge
    Fleet Changes
  Current Quarter

Dry


Tankers


TotalBarges operated as of the end of the 2nd qtr of 2010


2,135



337



2,472Retired (includes reactivations)


(49
)


(11
)


(60
)New builds










Purchased






6



6Change in number of barges leased


(3
)


(6
)


(9
)Barges operated as of the end of the 3rd qtr of 2010


2,083



326



2,409   Nine Months Ended September 30, 2010

Dry


Tankers


TotalBarges operated as of the end of 2009


2,149



361



2,510Retired


(106
)


(35
)


(141
)New builds


50







50Purchased






6



6Change in number of barges leased


(10
)


(6
)


(16
)Barges operated as of the end of the 3rd qtr 2010


2,083



326



2,409     Owned
    Boat Counts and Average Age by Horsepower Class
  AverageHorsepower Class

Number


Age1950 or less


36



32.4Less than 4300


21



34.7Less than 6200


43



35.87000 or over


11



32.0Total/overall age


111



34.1       Manufacturing
   33




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##### Table of Contents



Manufacturing
    Segment Units Produced for External Sales or Internal
    Use
  Quarters Ended


Nine Months EndedSeptember 30,


September 30,2010


2009


2010


2009External sales:Liquid tank barges


2



9



7



39Ocean tank barges






1



2



3Deck barges


15







15



Dry cargo barges


60



53



69



72Total external units sold


77



63



93



114Internal sales:Liquid tank barges






2







7Dry cargo barges










50



Total units into production






2



50



7Total units produced


77



65



143



121  34




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##### Table of Contents



Consolidated
    Financial Overview  Non-GAAP Financial Measure
    Reconciliation
  NET
    INCOME TO EBITDA RECONCILIATION
  Quarter Ended Sept. 30,


Nine Months Ended Sept. 30,2010


2009


2010


2009Net Income (Loss) from Continuing Operations

$
5,065


$
(8,768
)

$
222


$
(16,179
)Discontinued Operations, Net of Income Taxes






(3,404
)


(2
)


(5,219
)Consolidated Net Income (Loss)

$
5,065


$
(12,172
)

$
220


$
(21,398
)Adjustments from Continuing Operations:Interest Income






(1
)


(1
)


(12
)Interest Expense


9,815



10,470



29,434



30,803Debt Retirement Expenses






17,659







17,659Depreciation and Amortization


11,207



13,042



35,118



39,515Taxes


5,583



(4,940
)


1,089



(9,149
)Adjustments from Discontinued Operations:Interest Income














(1
)Interest Expense






10







30Depreciation and Amortization






348







1,149Taxes






(2,051
)






(2,883
)EBITDA from Continuing Operations


31,670



27,462



65,862



62,637EBITDA from Discontinued Operations






(5,097
)


(2
)


(6,924
)Consolidated EBITDA

$
31,670


$
22,365


$
65,860


$
55,713EBITDA from Continuing Operations by Segment:Transportation Net Income (Loss)

$
5,527


$
(12,960
)

$
553


$
(35,229
)Interest Income






(1
)


(1
)


(12
)Interest Expense


9,815



10,470



29,434



30,803Debt Retirement Expenses






17,659







17,659Depreciation and Amortization


10,294



12,068



32,368



36,622Taxes


5,583



(4,940
)


1,089



(9,170
)Transportation EBITDA

$
31,219


$
22,296


$
63,443


$
40,673Manufacturing Net (Loss) Income

$
(596
)

$
4,224


$
(582
)

$
18,972Depreciation and Amortization


829



891



2,498



2,642Total Manufacturing EBITDA


233



5,115



1,916



21,614Intersegment Profit














External Manufacturing EBITDA

$
233


$
5,115


$
1,916


$
21,614    35




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##### Table of Contents



Outlook
  year-over-year
           36




---



##### Table of Contents



ton-miles
  order-to-billing-to-collections.
   37




---



##### Table of Contents



Transportation:
         38




---



##### Table of Contents



barge-to-warehouse-to-truck
    ton-mile
  2009-2010
 39




---



##### Table of Contents



barge-to-warehouse-to-truck
  ton-mile
  year-over-year
      Manufacturing:
     40




---



##### Table of Contents



41




---



##### Table of Contents



OPERATING
    RESULTS by BUSINESS SEGMENT
    Quarter Ended September 30, 2010 as compared with Quarter
    Ended September 30, 2009
  % of ConsolidatedRevenueQuarter Ended Sept. 30,





3rd Quarter2010


2009


Variance


2010


2009REVENUETransportation and Services

$
165,762


$
143,690


$
22,072



80.0
%


69.1
%Manufacturing (external and internal)


41,617



68,304



(26,687
)


20.1
%


32.9
%Intersegment manufacturing elimination


(93
)


(4,106
)


4,013



(0.1
)%


(2.0
)%Consolidated Revenue


207,286



207,888



(602
)


100.0
%


100.0
%OPERATING EXPENSETransportation and Services


144,883



133,806



11,077Manufacturing (external and internal)


42,214



64,131



(21,917
)Intersegment manufacturing elimination


(93
)


(4,106
)


4,013Consolidated Operating Expense


187,004



193,831



(6,827
)


90.2
%


93.2
%OPERATING INCOMETransportation and Services


20,879



9,884



10,995Manufacturing (external and internal)


(597
)


4,173



(4,770
)Intersegment manufacturing elimination










Consolidated Operating Income


20,282



14,057



6,225



9.8
%


6.8
%Interest Expense


9,815



10,470



(655
)Debt Retirement Expenses






17,659



(17,659
)Other Expense (Income)


(181
)


(364
)


183Income (Loss) Before Income Taxes


10,648



(13,708
)


24,356Income Tax (Benefit)


5,583



(4,940
)


10,523Discontinued Operations






(3,404
)


3,404Net Income (Loss)

$
5,065


$
(12,172
)

$
17,237Domestic Barges Operated (average of period beginning and end)


2,441



2,540



(99
)Revenue per Barge Operated (Actual)

$
67,057


$
55,955


$
11,102   RESULTS
    OF OPERATIONS
  Quarter
    ended September 30, 2010 comparison to quarter ended
    September 30, 2009
  Revenue.
       42




---



##### Table of Contents



Operating Expense.
      Operating Income.
     43




---



##### Table of Contents



Interest Expense.
  Debt Retirement Expense.
  Income Tax Expense.
  Net Income (Loss).
  OPERATING
    RESULTS by BUSINESS SEGMENT
    Nine Months Ended September 30, 2010 as compared with Nine
    Months Ended September 30, 2009
  % of ConsolidatedRevenueNine Months Ended Sept. 30,





Nine Months2010


2009


Variance


2010


2009REVENUETransportation and Services

$
455,038


$
448,768


$
6,270



87.5
%


72.5
%Manufacturing (external and internal)


86,117



184,159



(98,042
)


16.6
%


29.7
%Intersegment manufacturing elimination


(21,272
)


(13,811
)


(7,461
)


(4.1
)%


(2.2
)%Consolidated Revenue


519,883



619,116



(99,233
)


100.0
%


100.0
%OPERATING EXPENSETransportation and Services


424,076



445,328



(21,252
)Manufacturing (external and internal)


86,676



165,316



(78,640
)Intersegment manufacturing elimination


(21,272
)


(13,811
)


(7,461
)Consolidated Operating Expense


489,480



596,833



(107,353
)


94.2
%


96.4
%OPERATING INCOMETransportation and Services


30,962



3,440



27,522Manufacturing (external and internal)


(559
)


18,843



(19,402
)Intersegment manufacturing elimination










Consolidated Operating Income


30,403



22,283



8,120



5.8
%


3.6
%Interest Expense


29,434



30,803



(1,369
)Debt Retirement Expenses






17,659



(17,659
)Other Expense (Income)


(342
)


(851
)


509Income (Loss) Before Income Taxes


1,311



(25,328
)


26,639Income Tax (Benefit)


1,089



(9,149
)


10,238Discontinued Operations


(2
)


(5,219
)


5,217Net Income (Loss)

$
220


$
(21,398
)

$
21,618Domestic Barges Operated (average of period beginning and end)


2,460



2,585



(125
)Revenue per Barge Operated (Actual)

$
182,523


$
171,525


$
10,998  44




---



##### Table of Contents



RESULTS
    OF OPERATIONS
  Nine
    months ended September 30, 2010 comparison to nine months
    ended September 30, 2009
  Revenue.
    ton-mile ton-miles ton-mile
    Operating Expense.
    quarter-over-quarter
  Operating Income.
   45




---



##### Table of Contents



Interest Expense.
  Debt Retirement Expense.
  Income Tax Expense.
  Net Income (Loss).
  LIQUIDITY
    AND CAPITAL RESOURCES
         46




---



##### Table of Contents



Our
    Indebtedness
      Net
    Cash, Capital Expenditures and Cash Flow
     47




---



##### Table of Contents



CHANGES
    IN ACCOUNTING STANDARDS
  No. 2009-01,
    No. 2010-06,
  Form 10-K
  CRITICAL
    ACCOUNTING POLICIES
   48




---



##### Table of Contents



percentage-of-completion
  Form 10-K
  Form 10-Q Regulation S-X.
  QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
    Fuel
    Price Risk
   49




---



##### Table of Contents



Interest
    Rate and Other Risks
    Foreign
    Currency Exchange Rate Risks
    ITEM 3.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK    ITEM 4.
    CONTROLS
    AND PROCEDURES  Evaluation of Disclosure Controls and
    Procedures. Rule 13a-15(b)).
  Changes in Internal Control over Financial
    Reporting. Rules 13a-15(f) 15d-15(f)
 50




---



##### Table of Contents



PART II 
    OTHER INFORMATION  ITEM 1.
    LEGAL
    PROCEEDINGS    Environmental
    and Other Litigation
  Leonard Becker v. American
    Commercial Lines, Inc. et. al. and/or
    Collision Incident, Mile Marker 97 of the Mississippi
    River. No. 08-4012, No. 08-4007, No. 09-cv-04494
   51




---



##### Table of Contents



No. 09-4464
  08-4156,
      Barge Cleaning Facilities, Port Arthur,
    Texas.
 52




---



##### Table of Contents



Bulk Terminals Site, Louisville,
    Kentucky.
  Pulvair Site Group, Tennessee.
  ITEM 1A.
    RISK
    FACTORS    RISKS
    RELATED TO OUR INDUSTRY
  The
    aftermath of the global economic crisis which began in 2008 is
    likely to continue to have detrimental impacts on our
    business.
    Potential recession impacts
  Credit availability to our customers and
    suppliers
  Market risk
  Freight
    transportation rates for the Inland Waterways fluctuate from
    time to time and may decrease.
  season-to-season year-to-year.
 53




---



##### Table of Contents



quarter-to-quarter year-to-year. year-to-year
  An
    oversupply of barging capacity may lead to reductions in freight
    rates.
    Yields
    from North American and worldwide grain harvests could
    materially affect demand for our barging services.
    Diminishing
    demand for new barge construction may lead to a reduction in
    sales volume and prices for new barges.
   54




---



##### Table of Contents



Volatile
    steel prices may lead to a reduction in or delay of demand for
    new barge construction.
    Higher
    fuel prices, if not recouped from our customers, could
    dramatically increase operating expenses and adversely affect
    profitability.
  quarter-over-quarter year-over-year
  Our
    operating margins are impacted by certain low margin legacy
    contracts and by spot rate market volatility for grain volume
    and pricing.
    quarter-to-quarter year-to-year.
 55




---



##### Table of Contents



We are
    subject to adverse weather and river conditions, including
    marine accidents.
        Seasonal
    fluctuations in industry demand could adversely affect our
    operating results, cash flow and working capital
    requirements.
    The
    aging infrastructure on the Inland Waterways may lead to
    increased costs and disruptions in our operations.
   56




---



##### Table of Contents



The
    inland barge transportation industry is highly competitive;
    increased competition could adversely affect us.
    Global
    trade agreements, tariffs and subsidies could decrease the
    demand for imported and exported goods, adversely affecting the
    flow of import and export tonnage through the Port of New
    Orleans and other
    Gulf-coast
    ports and the demand for barging services.
    Our
    failure to comply with government regulations affecting the
    barging industry, or changes in these regulations, may cause us
    to incur significant expenses or affect our ability to
    operate.
  and/or
    Our
    maritime operations expose us to numerous legal and regulatory
    requirements, and violation of these regulations could result in
    criminal liability against us or our officers.
   57




---



##### Table of Contents



The
    Jones Act restricts foreign ownership of our stock, and the
    repeal, suspension or substantial amendment of the Jones Act
    could increase competition on the Inland Waterways and have a
    material adverse effect on our business.
      RISKS
    RELATED TO OUR BUSINESS
  The
    Merger Agreement with an affiliate of Platinum Equity may be
    delayed or may not be consummated.
    We are
    named as a defendant in lawsuits and we are in receipt of other
    claims and we cannot predict the outcome of such litigation and
    claims which may result in the imposition of significant
    liability.
    We are
    facing significant litigation which may divert management
    attention and resources from our business.
   58




---



##### Table of Contents



Our
    insurance may not be adequate to cover our losses.
    Our
    aging fleet of dry cargo barges may lead to increased costs and
    disruptions in our operations.
    We
    have experienced work stoppages by union employees in the past,
    and future work stoppages may disrupt our services and adversely
    affect our operations.
    We may
    not ultimately be able to drive efficiency to the level to
    achieve our current forecast of tonnage without investing
    additional capital or incurring additional costs.
   59




---



##### Table of Contents



Our
    cash flows and borrowing facilities may not be adequate for our
    additional capital needs and our future cash flow and capital
    resources may not be sufficient for payments of interest and
    principal of our substantial indebtedness.
    A
    significant portion of our borrowings are tied to floating
    interest rates which may expose us to higher interest payments
    should interest rates increase substantially.
    The
    indenture and the Credit Facility impose significant operating
    and financial restrictions on our Company and our subsidiaries,
    which may prevent us from capitalizing on business
    opportunities.
    
    incur additional indebtedness or enter into sale and leaseback
    obligations;
    pay dividends or certain other distributions on our capital
    stock or repurchase our capital stock other than allowed under
    the indenture;
    make certain investments or other restricted payments;
    place restrictions on the ability of subsidiaries to pay
    dividends or make other payments to us;
    engage in transactions with stockholders or affiliates;
    sell certain assets or merge with or into other companies;
    guarantee indebtedness; and
    create liens.    We
    face the risk of breaching covenants in the Credit
    Facility.
   60




---



##### Table of Contents



The
    loss of one or more key customers, or material nonpayment or
    nonperformance by one or more of our key customers, could cause
    a significant loss of revenue and may adversely affect
    profitability.
    A
    major accident or casualty loss at any of our facilities or
    affecting free navigation of the Gulf or the Inland Waterways
    could significantly reduce production.
    A
    temporary or permanent closure of the river to barge traffic in
    the Chicago area in response to the threat of Asian carp
    migrating into the Great Lakes may have an adverse affect on
    operations in the area.
    Interruption
    or failure of our information technology and communications
    systems, or compliance with requirements related to controls
    over our information technology protocols, could impair our
    ability to effectively provide our services or increase our
    information technology costs and could damage our
    reputation.
    Many
    of our employees are covered by federal maritime laws that may
    subject us to job-related claims.
   61




---



##### Table of Contents



The
    loss of key personnel, including highly skilled and licensed
    vessel personnel, could adversely affect our
    business.
    Failure
    to comply with environmental, health and safety regulations
    could result in substantial penalties and changes to our
    operations.
  200-mile
   62




---



##### Table of Contents



We are
    subject to, and may in the future be subject to disputes or
    legal or other proceedings that could involve significant
    expenditures by us.
      ITEM 2.
    UNREGISTERED
    SALES OF EQUITY SECURITIES AND USE OF PROCEEDS    ITEM 3.
    DEFAULTS
    UPON SENIOR SECURITIES    ITEM 4.
    REMOVED
    AND RESERVED  ITEM 5.
    OTHER
    INFORMATION    ITEM 6.
    EXHIBITS  ExhibitNo.

Description10
.1*

Employment Letter Agreement, dated July 26, 2010, by and
    between American Commercial Lines Inc. and William A.
    Braman, II.31
.1*

Certification by Michael P. Ryan, Chief Executive Officer,
    required by
    Rule 13a-14(a)
    of the Securities Exchange Act of 1934.31
.2*

Certification by Thomas R. Pilholski, Senior Vice President and
    Chief Financial Officer, required by
    Rule 13a-14(a)
    of the Securities Exchange Act of 1934.32
.1*

Certification by Michael P. Ryan, Chief Executive Officer,
    pursuant to 18 U.S.C. Section 1350.32
.2*

Certification by Thomas R. Pilholski, Senior Vice President and
    Chief Financial Officer, pursuant to 18 U.S.C.
    Section 1350.     *
    
    Filed herein 63




---



##### Table of Contents



SIGNATURES      By:
    /s/  Michael
    P. Ryan     By:
    /s/  Thomas
    R. Pilholski       64




---



##### Table of Contents



INDEX TO
    EXHIBITS
  Exhibit No.

Description10
.1*

Employment Letter Agreement, dated July 26, 2010, by and
    between American Commercial Lines Inc. and William A.
    Braman, II.31
.1*

Certification by Michael P. Ryan, Chief Executive Officer,
    required by
    Rule 13a-14(a)
    of the Securities Exchange Act of 1934.31
.2*

Certification by Thomas R. Pilholski, Senior Vice President and
    Chief Financial Officer, required by
    Rule 13a-14(a)
    of the Securities Exchange Act of 1934.32
.1*

Certification by Michael P. Ryan, Chief Executive Officer,
    pursuant to 18 U.S.C. Section 1350.32
.2*

Certification by Thomas R. Pilholski, Senior Vice President and
    Chief Financial Officer, pursuant to 18 U.S.C.
    Section 1350.     *
    
    Filed herein 65