Wabash National Corporation (NYSE:WNC) set first-quarter records for sales, gross profit, income from operations and operating EBITDA.
Wabash had operating income of $48.2 million (a 77% increase over last year), gross margin and operating income margin of 17.8% and 10.8%, respectively, and net sales of $448 million that represent the best first quarter in company history.
Net income for the first quarter of 2016 was $27.5 million, or $0.42 per diluted share, compared to the first quarter 2015 net income of $10.5 million, or $0.15 per diluted share.
Operating EBITDA, a non-GAAP measure that excludes the effects of certain recurring and non-recurring items, for the first quarter of 2016 was $59.8 million, an increase of $20.7 million, or 53%, compared to operating EBITDA for the prior year period. On a trailing 12-month basis, net sales exceeded $2 billion, generating Operating EBITDA of $250.1 million, or 12.3% of net sales.
Wabash said the continued year-over-year improvement in operating performance is attributable to the successful execution of the company’s growth and diversification strategies, strong pricing environment within the Commercial Trailer Products segment and operational improvements across the company’s manufacturing facilities.
Said Dick Giromini, president and chief executive officer, “The momentum generated in 2015 has continued into the first quarter of 2016 with strong operational execution throughout the company, along with margin enhancement through improved pricing and a continued strong demand environment within our Commercial Trailer Products segment.”
“New trailer shipments for the first quarter were approximately 14,500, exceeding our previous guidance of 13,000 to 14,000 trailers driven by strong customer pick-ups and favorable weather conditions. A robust backlog of $1.1 billion; overall trailer market projections by ACT Research and FTR; customer commentary; and outstanding operational execution across the business, have put us on pace to deliver another record year in 2016, our fifth consecutive year of record performance. As such, we are increasing our full-year adjusted earnings guidance to $1.65 to $1.75 per diluted share.”
Commercial Trailer Products’ net sales increased $40 million, or 12.8 percent, on shipments of 14,300 trailers, or 700 more trailers than the prior year period. This increase in revenue was primarily due to an improved pricing environment, a 5.1 percent increase in trailer shipments and product mix. Supported by higher volumes, pricing and continued operational improvements, gross profit and gross profit margin increased $30.0 million and 740 basis points, respectively, as compared to the same period last year. Operating income increased $29.3 million, or 128.6 percent, from the first quarter last year to $52.1 million.
Diversified Products’ net sales decreased $25 million, or 23.6 percent, primarily the result of lower tank trailer shipments as compared to the previous year period. Demand for non-trailer truck mounted equipment, process systems and composite products were comparable with the previous year period. Gross profit and operating income declined $4.8 million and $4.0 million, respectively, compared to the prior year period, primarily due to lower overall net sales and pricing pressures on certain products. However, gross profit margin improved 80 basis points as compared to the prior year as a result of continued strong operational execution and product mix.
Retail’s net sales of $34 million decreased 21.1 percent compared with the prior year period primarily due to lower shipments of new trailers. Gross profit and operating income declined $1.1 million and $1.3 million, respectively, compared to the prior year period due to lower net sales. Gross profit margin of 11.1 percent was comparable with the prior year period despite lower sales due to a higher mix of parts and service product lines.