Wabash National Corporation today announced first-quarter results, with net sales at $262.1 million, compared to $256.1 million for the same period last year, and net income at $4.3 million or $0.13 per diluted share, compared to $18.5 million or $0.52 per diluted share.
Income for the quarter was taxed at a 39% effective tax rate while the prior year was taxed at alternative minimum tax rates. The acquisition of Transcraft, completed March 3, 2006, added approximately $2.7 million to sales in the quarter.
"While many aspects of the business were challenged during the quarter, we continue to gain momentum with our initiatives in plant automation, product standardization and alternative sourcing, and we expect this to be demonstrated in improved future results," said Bill Greubel, Chief Executive Officer. "These challenges included sales volumes being constrained by an unusually high percentage of customer equipment pick-up delays (versus factory deliveries), margin compression resulting from competitive pricing and higher raw materials costs. Also, during the quarter we made the decision to withdraw from the intermodal container market and completed all production by the end of the quarter. The current period includes a charge of $ 1.1 million to write-off related assets.
"On a positive note, we continue to see strong quote and order activity throughout all buying segments and have booked approximately 85% of our sales target for 2006, ahead of last year's pace. During the next two quarters we are planning to increase production by approximately 20% so as to better manage our backlog. A significant part of this planned build will be the ramping up of our new semi-automated Alpha line to three shifts. We believe as our key initiatives are gaining traction, we have seen a bottom to our margin erosion and expect to see incremental improvement over the next several quarters."
Wabash achieved new trailer unit sales of 11,700 for the first quarter, compared to 11,200 the first quarter of 2005. Backlog at March 31 amounted to approximately $610 million, including $42 million related to Transcraft.