Wabash Narrows Loss in Fourth Quarter Amid Weak Trailer Sales

Trailer manufacturer Wabash National Corporation reported an operating loss of $11.9 million in the fourth quarter of 2009, compared to an operating loss of $87.2 million for the fourth quarter of 2008.

Net sales for the fourth quarter was $85 million, with new trailer sales at 3,300 units, a 65 percent drop from the fourth quarter of 2008.

Meanwhile, the company's net income was $10.9 million, or 15 cents a share, versus a net loss of $111.9 million, or $3.73 a share, in the year-ago quarter.

The company's operating EBITDA, or earnings before interest, taxes, preferred stock dividends, depreciation, and amortization, was a loss of about $6.3 million, an improvement over the ago quarter's loss of $13.5 million. However, the fourth quarter loss was greater than that in the third quarter due to slightly lower sales volumes and seasonally higher production costs, Wabash says.

"While our industry faced the most difficult economic period in decades, we made significant improvements in 2009 to our cost structure and operational efficiency," said Dick Giromini, president and CEO. "During the year, our associates were challenged with not only continuing to pursue our strategic initiatives, but also executing measures designed to improve our long-term value proposition. The results of our efforts are clear, as Wabash has meaningfully reduced its breakeven point and positioned itself for increased profitability as volume levels improve."

Despite the weak quarter, the company remains positive about the year ahead.

"While the first quarter is seasonally one of the weakest periods, we remain optimistic about the prospects for our industry," Giromini said. "We are encouraged to see order activity pick up, and our backlog, which as of the end of the year was $137 million, is up from $96 million in September, and $110 million as of a year ago. Key economic indicators have also shown noteworthy levels of stabilization and even incremental improvement. Additionally, industry sources expect trailer demand to increase during the third and fourth quarters of 2010, with demand improving markedly in 2011 and 2012. Although some challenges remain, we believe the worst is now behind us."