US trailer manufacturer Wabash National reported significant year-over-year improvement across a number of financial and operating metrics. The company reported net income of $1.1 million, or $0.02 per diluted share for the third quarter of 2011 on net sales of $336 million compared to a net loss of $1.9 million, or $0.03 per diluted share, on net sales of $171 million for the third quarter of 2010.
For the nine months ended September 30, the company reported net income of $7.6 million, or $0.11 per diluted share, on net sales of $846 million for 2011 compared to a net loss of $146.6 million, or $3.93 per diluted share, on net sales of $399 million for 2010. Results for the nine months ending September 30, 2011 include a one-time charge of $0.7 million, or $0.01 per diluted share, related to the early extinguishment of the company’s prior revolving credit facility that was replaced during the second quarter.
Results for the three and nine months ended September 30, 2010 included a noncash benefit of $3.3 million, or $0.05 per diluted share, and a charge of $121.6 million, or $2.78 per diluted share, respectively, related to the change in the fair value of the company’s warrant which was issued in 2009 to a private investor and fully exercised in the third quarter of 2010.
The company reported operating income of $2.3 million for the third quarter of 2011, compared to an operating loss of $4.2 million for the third quarter of 2010. For the nine months ended September 30, the company reported operating income of $11.4 million for 2011 as compared to an operating loss of $21.2 million for 2010. The improvement in operating results of $6.5 million and $32.6 million for the three and nine month periods, respectively, resulted primarily from higher new trailer shipments of 13,600 and 33,900 units, representing increases of 100 percent and 129 percent, respectively, from the prior year periods.
Dick Giromini, President and Chief Executive Officer, states, “We are pleased to have delivered noteworthy year-over-year improvement in our operating results for the eighth consecutive quarter. As expected, the third quarter presented the most significant cost and performance challenges of the year related to the peak effect of higher raw material costs; fixed-price, lower-margin orders accepted early in the cycle; and labor inefficiencies associated with capacity ramp-up. However, we made progress in working through these challenges as we moved through the third quarter. Going forward, we firmly expect to deliver improved financial performance that is more reflective of current demand and, more importantly, our positioning in the marketplace.
“For the third quarter, new trailer shipments increased to 13,600, representing the highest shipment quarter since 2006. We expect to see a similar shipment level for the fourth quarter with 2011 full-year new trailer shipments estimated to be approximately 47,000 to 48,000 units and supported by a backlog of $513 million as of September 30, 2011,” he adds.
“With the third quarter now behind us, we look forward to improving margins through the continued optimization initiatives and an improving mix of highermargin orders. Longer-term, as we enter the 2012 order season, we are committed to improving pricing and margins and we remain confident in our strategic positioning to deliver improved operating performance throughout the cycle along with continued diversification of the business. Our industry is still early in the recovery cycle and we are well positioned to capitalize on the increasing demand for new trailers.”
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