Wabash National Corporation Announces Second Quarter 2020 Results
Wabash National Corporation (the “Company”), the innovation leader of engineered solutions for the transportation, logistics and distribution industries, today reported results for the quarter ended June 30, 2020.
Net sales for the second quarter 2020 were $339.2 million as operations were able to maintain productivity levels in the face of unprecedented business and operating conditions brought on by COVID-19. Additionally, customer pick-ups of new equipment improved following disruption seen during the first quarter in the lead-up to COVID-19-related shutdowns. Operating income was $6.0 million during the quarter as rapid implementation of cost control measures limited decremental margins to 15 percent. Earnings per share was $0.00 for the second quarter.
Total Company backlog as of June 30, 2020 was approximately $750 million compared to backlog of approximately $1.0 billion ending March 2020 as normal seasonal trends indicate an expected sequential softening in backlog during the second quarter.
“The second quarter was the most uniquely challenging time I’ve experienced in my career. Balancing continued operations to support our customers during a global pandemic while implementing meaningful short-term cost control measures as well as longer-term initiatives to optimize our organizational structure took a remarkable level of dedication from every level of our organization, and I’d like to acknowledge the tremendous efforts of our people,” said Brent Yeagy, president and chief executive officer. “To limit decremental margins to fifteen percent during the second quarter reflects the dedication of our people as well as the long-term improvements we’ve made to our business portfolio and within our operating system. The cost reductions we’ve made allow us to control expense in the short-term while preserving the business’ ability to quickly accelerate when market conditions invariably improve.”
Liquidity as of the end of the second quarter was $304 million with cash of $136 million and a fully untapped revolving credit line of $168 million following the second quarter repayment of a proactive drawdown of the revolver during the first quarter. Overall liquidity increased by $27 million sequentially as positive cash flow from operations was supplemented by a release of working capital. The Company’s nearest debt maturity, amounting to $135 million, is in March of 2022. Additionally, the Company’s debt carries no financial covenants.
“Our backlog combined with second quarter shipments shows that orders continued to flow at a moderate pace during the second quarter, which normally sees sales outpace new orders. We continue to be pleased with the state of our order book and the visibility it provides for the second half of the year,” continued Yeagy. “Our goal for 2020 remains positive free cash flow generation and our second quarter results serve to strengthen our expectations of achieving that target. We aim to demonstrate how our free cash flow profile has improved from previous cycles by maintaining our dividend through this challenging time and continuing to deploy capital in the best interest of our long-term shareowners.”
Business Segment Highlights
The table below is a summary of select segment operating and financial results prior to the elimination of intersegment sales for the second quarter of 2020 and 2019. A complete disclosure of the results by individual segment is included in the tables following this release.
Commercial Trailer Products’ net sales for the second quarter were $232.3 million, a decrease of 42.1 percent as compared to the prior year quarter as a result of a reduction in market demand. Operating income was $18.6 million or 8.0% of sales during the quarter.
Diversified Products’ net sales for the second quarter were $64.0 million, a decrease of 34.1 percent as compared to the prior year as a result of lower market demand. Operating income was $2.2 million or 3.5 percent of sales during the quarter.
Final Mile Products’ net sales for the second quarter totaled $50.8 million, a decrease of 62.3 percent, as compared to the prior year, due to softer market demand. Operating loss was $6.6 million during the quarter as a result of weaker volume leverage over fixed costs.
For the full second quarter results, click here.
About Wabash National Corporation
Headquartered in Lafayette, Indiana, Wabash National Corporation (NYSE: WNC) is a diversified industrial manufacturer and a leading producer of semi-trailers, truck bodies and liquid transportation systems. Established in 1985, the Company manufactures a diverse range of products including: dry freight and refrigerated trailers, platform trailers, bulk tank trailers, dry and refrigerated truck bodies, truck-mounted tanks, intermodal equipment, structural composite panels and products, trailer aerodynamic solutions, and specialty food grade and pharmaceutical equipment. Its innovative products are sold under the following brand names: Wabash National®, Beall®, Benson®, Brenner® Tank, Bulk Tank International, DuraPlate®, Extract Technology®, Supreme®, Transcraft®, Walker Engineered Products, and Walker Transport. Learn more at www.wabashnational.com.
Dana Stelsel – Director Corporate Communications – firstname.lastname@example.org – (765) 771-5766
Source: Wabash National Corporation