LAFAYETTE, Ind. –- Wabash National Corporation (NYSE: WNC) reported year-over-year improvement across most financial and operating metrics.
They reported net income of $3.2 million and $0.05 per diluted share for the first quarter of 2011 on net sales of $222 million. For the same quarter last year, they reported net loss of $139.1 million, or $4.64 per diluted share, on net sales of $78 million. Results for the three months ended March 31, 2010 included a non-cash charge of $126.8 million, or an impact of $4.17 per diluted share, related to the increase 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 $4.0 million for the first quarter of 2011 compared to an operating loss of $11.2 million for the first quarter of 2010. The improvement in operating income of $15.2 million for the three month period resulted primarily from higher new trailer shipments of 8,900 units, an increase of 242 percent from the prior year period.
The following is a summary of select operating and financial results for the past five quarters:
Three Months Ended --------------- --------------- ---------------- --------------- --------------- March 31, June 30, September 30, December 31, March 31, (Dollars in thousands) 2010 2010 2010 2010 2011 --------------- --------------- ---------------- --------------- --------------- New Trailer Units Sold 2,600 5,400 6,800 10,100 8,900 Net Sales $ 78,274 $ 149,699 $ 170,848 $ 241,550 $ 221,984 Gross Profit Margin -1.2% 3.5% 3.8% 7.2% 7.4% Income (Loss) from Operations $ ( 11,232) $ ( 5,715) $ ( 4,206) $ 5,736 $ 4,009 Net Income (Loss) $ ( 139,079)(1) $ ( 5,602)(1) $ ( 1,938)(1) $ 4,859 $ 3,197 Operating EBITDA (Non-GAAP) $ ( 5,975) $ ( 493) $ 643 $ 10,752 $ 8,802 Notes: (1) Quarterly Net Income (Loss) includes a non-cash benefit (charge) of approximately ($126.8) million, $1.9 million and $3.3 million for the first, second and third quarters of 2010, respectively, related to the change in the fair value of the Company’s warrant which was issued to a private investor in 2009 and fully exercised in the third quarter of 2010.
Dick Giromini, President and Chief Executive Officer, stated, “Our operating results continued to improve both year-over-year and sequentially. In fact, first quarter gross profit margin of 7.4% reflects our best performance since 2007. These results were driven by continued improvement in our production efficiencies and reflect the leverage achieved from our cost optimization efforts implemented during the recent downturn. Our efforts to further diversify our business continued to gain traction as sales of our DuraPlate® Products had its best quarter on record with revenue of approximately $11 million. In addition, we also announced an agreement this quarter to further diversify through increased sales of our Allied Products to manufacture Frac tanks for the environmental services and oil and gas industries.”
Mr. Giromini continued, “New trailer shipments of 8,900 for the first quarter were at the high-end of our guidance and backlog increased over $250 million to approximately $731 million as of March 31, 2011, reaching the highest level in more than a decade. The strength of our backlog coupled with very low cancellation rates reflects the accelerating recovery in our industry and the strength of our market position. In addition, ACT has recently increased its forecast for 2011 industry trailer volumes to approximately 200,000 units. As a result of these factors and our improved outlook for demand, we are also increasing our new trailer shipment expectations for 2011 to an estimated 45,000 to 47,000 units. With volumes now reaching pre-recession levels, we are focusing our attention to the shorter-term challenges associated with additional ramp-up in production capacity and the continuing impacts of rising commodity and component costs.”
On a non-GAAP basis, the Company’s Operating EBITDA of $8.8 million was better than the first quarter of 2010 by approximately $14.8 million on approximately 6,300 additional new trailer shipments. A discussion of the Company’s use of Operating EBITDA as a non-GAAP measure is included below, and a reconciliation of Operating EBITDA to net income (loss) is provided in the supplemental schedules included in this release.
First Quarter 2011 Conference Call
Wabash National Corporation will conduct a conference call to review and discuss its first quarter results on May 4, 2011, at 10:00 a.m. EDT. The phone number to access the conference call is 877-407-8035. The call can also be accessed live on the Company’s website at www.wabashnational.com. For those unable to participate in the live webcast, the call will be archived at www.wabashnational.com within three hours of the conclusion of the live call and will remain available through July 27, 2011.
In addition to disclosing financial results calculated in accordance with United States generally accepted accounting principles (GAAP), the financial information included in this release contains the non-GAAP financial measure Operating EBITDA.
Operating EBITDA should not be considered a substitute for, or superior to, financial measures and results calculated in accordance with GAAP, including net income (loss), and reconciliations to GAAP financial statements should be carefully evaluated.
Operating EBITDA is defined as earnings before interest, taxes, preferred stock dividends, depreciation, amortization, stock-based compensation, and other non-operating income and expense, as well as noncash charges associated with the Company’s warrant issued in 2009 and fully exercised in 2010. Management believes Operating EBITDA provides useful information to investors regarding our results of operations. We provide this measure because we believe it is useful for investors to understand our performance period to period with the exclusion of the recurring and non-recurring items identified above. Management believes the presentation of Operating EBITDA, when combined with the primary GAAP presentation of operating income, is beneficial to an investor’s complete understanding of our operating performance. A reconciliation of Operating EBITDA to net income (loss) is included in the tables following this release.
About Wabash National Corporation
Headquartered in Lafayette, Ind., Wabash National® Corporation (NYSE: WNC) is one of the leading manufacturers of semi trailers in North America. Established in 1985, the Company specializes in the design and production of dry freight vans, refrigerated vans, flatbed trailers, drop deck trailers, dump trailers, truck bodies and intermodal equipment. Its innovative core products are sold under the DuraPlate®, ArcticLite®, FreightPro™ Eagle® and Benson™ brand names. The Company operates two wholly-owned subsidiaries: Transcraft® Corporation, a manufacturer of flatbed, drop deck, dump trailers and truck bodies; and Wabash National Trailer Centers, trailer service centers and retail distributors of new and used trailers and aftermarket parts throughout the U.S.