Wabash reports improved performance

Wabash reports improved performance

Wabash National Corporation (NYSE: WNC) reported increased sales and a strengthening financial position during the quarter ending June 30.

The company sold 5,400 new trailers during the third quarter of 2010, up 69% when compared with the 3,200 trailers sold during the third quarter of last year. Not surprisingly, net sales also were up sharply—74% higher than the third quarter of 2009.

While sales are improving substantially, Wabash nevertheless reported an operating loss of $5.7 million for the second quarter of 2010, compared to an operating loss of $16.7 million for the second quarter of 2009. For the six months ended June 30, the company reported operating losses of $16.9 million and $44.0 million for 2010 and 2009, respectively.

The improvement in operating loss of $11.0 million and $27.1 million for the three and six month periods, respectively, resulted from higher production volumes and lower raw material and component costs, as well as the cost and manufacturing optimization enhancements that Wabash made throughout 2008 and 2009.

“We are pleased to deliver significant yearover-year improvement in our operating results,” said Dick Giromini, president and chief executive officer. “ Wabash National generated near-breakeven operating
EBITDA and noteworthy gross margin improvement during the quarter. In addition, we were encouraged to see continued strength in quote and order activity throughout the second quarter and a stronger backlog.”

Wabash reported a backlog of orders worth $377 million as of June 30, up from $137 million at year-end, and $128 million as of a year ago.

“This represents the third consecutive quarter of backlog expansion, which is a strong indicator
of the recovery occurring in our industry,” Giromini said. “The second and third quarters are generally seasonally lower periods for orders. We are positioned well to capitalize on this improved demand environment, as our efforts to rationalize our cost base and streamline our manufacturing operations have provided us with more operating leverage. A direct result of these efforts will be improved profitability as demand continues to return to more historical levels.

“Taking all of this into consideration, including industry analyst expectations for 2010 and 2011, we are updating our projection of new trailer shipments for the year, from our prior estimate of 18,000 to 22,000 units to 23,000 to 25,000 units. Additionally, third quarter shipments are expected to be in the range of 7,000 to 8,000 units, further increasing our confidence of delivering positive operating EBITDA during the third quarter.”

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