Publicly traded trailer manufacturer Wabash National Corp. on Thursday announced plans to implement a two-week idling of operations and company-wide furlough from April 20 to May 3. Customer support functions will continue to operate during the furlough, Wabash said in a statement.
“We are moving rapidly to adjust to the current environment while prioritizing the safety of our employees and ensuring the liquidity and financial well-being of the company,” said President and Chief Executive Officer Brent Yeagy. “We are taking the difficult, but necessary, decisions at all levels of the company to contain cost and preserve the strength of our balance sheet.”
Wabash posted a message on its website’s coronavirus page, above Yeagy’s signature, emphasizing the company’s commitment “to helping our customers deliver critical goods” and thanking employees, suppliers and customers “for the continued support in keeping trucks on the road.”
In turn, Wabash sales, warranty, shipping, and retail and service locations will remain open during this time. Additionally, operations in the United Kingdom and Mexico will continue running, the post said. The company encouraged suppliers and customers to contact their Wabash National representative with any questions or concerns prior to April 20.
“I am incredibly appreciative of how our employees, customers, suppliers, and community partners have come together to serve the life-sustaining businesses necessary to preserve our country’s public health and welfare,” Yeagy said in the notice. “We look forward to being a part of that solution again soon.”
Wabash also reported that, as of March 31, the company’s total liquidity was $277 million with cash and cash equivalents of $155 million and $122 million of available borrowings under its existing revolving credit facility. As a result of uncertainty caused by COVID-19, the company drew $45 million under its existing revolving credit facility in March 2020.
“Wabash National is well-positioned from a liquidity perspective as we have prepared for an eventual downturn in our industry over the last two years. We recently bolstered our cash balance by drawing on our revolving credit facility and we expect existing cash on hand to be more than adequate to cover cash needs over this extraordinary period of time,” said Chief Financial Officer Mike Pettit. “We have modeled numerous scenarios and we believe that even under the most extreme assumptions the company has sufficient liquidity to comfortably meet its cash obligations for at least the next 12 months.”
The company-wide furlough and the ongoing impact of the COVID-19 pandemic will push the company’s first quarter 2020 earnings conference call to May 14, according to the statement.
In an SEC filing, Wabash added the coronavirus pandemic to the list of business “Risk Factors” included in its annual report.
