Wabash National (WNC) Prelim. Q3 Results Miss Estimates

Wabash National Corporation (the “Company”) (NYSE: WNC), a diversified industrial manufacturer and a leading producer of semi-trailers, truck bodies and liquid transportation systems, today announced certain preliminary results for the quarter ending September 30, 2018. The preliminary results are subject to adjustment and finalization by the Company.

Net sales for the third quarter 2018 are expected to be between $550 million and $555 million compared to $425 million for the prior year quarter. Operating income is expected to be between $15.5 million and $17.5 million compared to $26.6 million for the prior year quarter.

The Company expects net income for the third quarter 2018 to be between $3.5 million and $5.5 million, or between $0.06 and $0.09 per diluted share, compared to the third quarter 2017 net income of $18.9 million, or $0.30 per diluted share. Third quarter 2018 non-GAAP adjusted earnings per diluted share are expected to be between $0.27 and $0.30, compared to the third quarter 2017 non-GAAP adjusted earnings per diluted share of $0.34. Non-GAAP adjusted earnings per diluted share for the third quarter 2018 excludes a non-cash asset impairment charge of $12.0 million associated with the Company’s Diversified Products reporting segment and discrete tax charges incurred related to the deductibility of executive compensation. Non-GAAP adjusted earnings per diluted share for the third quarter of 2017 excluded one-time acquisition expenses of $8.7 million related to the purchase of Supreme Industries, Inc. (“Supreme”) and gains realized on the transition of former branch facilities to third-party dealers.

(Street sees Q3 EPS of $0.52 on revenue of $596.42 million)

“The third quarter was a challenging and difficult quarter for the Company as a whole,” explained Brent Yeagy, president and chief executive officer. “All three of our reporting segments faced increasing operating pressures which negatively impacted our financial results. Total new trailer shipments and revenues were below our prior guidance due to our customers’ inability to pick up units as a result of the robust freight market and chassis availability within our Final Mile Products business. On the cost side of the business, higher commodity and component costs impacted the quarterly results as raw material costs continued to escalate. Supplier disruptions increased across the Company during the quarter, most notably within the Final Mile Products segment related to chassis delivery, resulting in production and labor inefficiencies as well as shipment delays. Lastly, labor instability continued to create operating cost pressures at many of our locations. Those labor cost pressures resulted in higher levels of overtime and lower productivity.”

Mr. Yeagy continued, “Despite the tough operating environment and preliminary results reflecting a very challenging third quarter, we continue to see strong overall market demand for our products and we are taking proactive steps to reduce the margin impact of U.S. tariff policy, raw material inflation, supply base disruptions and a very tight labor market for the remainder of 2018 and 2019. As a result, we are maintaining our full-year guidance for 2018 new trailer shipments of 60,000 to 62,000 units, while we are updating our GAAP and non-GAAP earnings to $1.41 to $1.46 per diluted share and $1.50 to $1.55 per diluted share, respectively.”

Third Quarter 2018 Conference CallWabash National will announce its complete third quarter 2018 financial results on Tuesday, October 30, 2018, and conduct a conference call to review and discuss its complete third quarter results on October 31, 2018, at 10:00 a.m. EDT. Access to the live webcast will be available 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 January 23, 2019. Meeting access also will be available via conference call at 844-778-4139, participant code 1851979.

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