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February 4, 2021 9:30 AM, EST

Wabash National Posts Lower Q4 Earnings

WabashWabash (Daniel Acker/Bloomberg News)

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Wabash National Corp. reported lower net income and revenue in the fourth quarter as new trailer shipments fell.

Net income for the period ended Dec. 31 was $5.4 million, or 10 cents per diluted share, compared with $18.3 million, or 34 cents, a year earlier.

Revenue dropped to $404 million compared with $579 million in the 2019 period.

In the quarter, new trailer shipments were 10,085 compared with 14,300 a year earlier.

“Conditions strengthened throughout 2020 in many of our customers’ end markets and equipment demand is poised to improve in 2021,” Wabash CEO Brent Yeagy said.

“I do want to call out that we were able to successfully hire approximately 600 new employees across our business during the fourth quarter. This hiring activity equated to adding to our workforce by about 15%. We fully expect to add another 900 employees during the first half of 2021 based on our progress to date,” Yeagy said.

Wabash CEO Brent Yeagy

Yeagy

At its largest unit, commercial trailer products, net sales for the quarter were $283 million, a decrease of 29.1% compared with the 2019 quarter, as a result of demand coming off peak levels but rebounding throughout the year, it reported.

Operating income in the segment was $25.5 million, or 9% of sales during the quarter.

Its diversified products’ net sales were $75.2 million, a decrease of 20.6% compared with the prior year quarter, as a result of reduced market demand. Operating income was $1.2 million, or 1.6% of sales. The segment includes tank trailers, and the unit shipped 525 trailers down from 650 a year earlier.

The final-mile products segment’s net sales for the quarter were $51.9 million, a decrease of 44%. Wabash cited as a reason “building to scheduled production during the quarter, while ramping to accommodate improved 2021 demand.” The unit’s operating loss during the fourth quarter was $4.5 million as a result of weaker volume leverage over fixed costs.

The final-mile products segment relies heavily on business from companies that use trucks to service their main business but are not professional freight carriers.

“While we are focused in the near-term on executing on this cyclical upturn, we also continue to work on strategic initiatives to profitably grow the company in the long term,” Yeagy said. “Bringing new technologies to market combined with our focus on building out adjacent revenue streams will provide us with opportunities for growth beyond what the cycle gives us.”

Yeagy said there were several societal drivers of change at work now.

These include the regulatory environment, the push for sustainability and the impact of climate change.

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Wabash said its backlog ended the fourth quarter at $1.5 billion, up sequentially by $500 million from the end of third quarter.

For the full year, the company reported a net loss of $97.4 million, or a loss of $1.84, compared with net profit of $89.5 million, or $1.62, a year earlier.

Annual revenue was $1.4 billion compared with $2.3 billion in the 2019 period.

Its full-year 2021 guidance ranges between $1.9 billion and $2 billion in sales, and an earnings per diluted share range of 70-80 cents.

In the earnings call, Yeagy cited what he called “the highly unfortunate assault” on the U.S. Capitol Jan. 6.

“First, I would say that lawlessness, rioting and destruction of property and affronts to personal safety are unacceptable across the board,” he said. “However, the events that occurred at the Capitol were especially appalling to me and I’ve ensured both internally at Wabash and externally that my position is clear: it was wrong, an embarrassment to our country and for our democracy to be so specifically assaulted while a peaceful transition of power was underway. CEOs and value-minded companies have an opportunity to lead on social issues and we choose to do so.”

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