Semi-trailer manufacturer Wabash National Corp. (NYSE: WNC) reported higher revenue and profits in the third quarter led by growth in its final mile and commercial trailer segments.
Net sales for the third quarter 2019 increased 5% to $581 million from $553 million in the prior year quarter. Net income for the third quarter 2019 was $25.5 million, or $0.46 per diluted share, compared with $4.7 million or $0.08 in the third quarter of 2018.
Operating income of $38.3 million equated to a 6.6% consolidated operating margin compared with 5.2% in the July-September period a year ago.
"Q3 is a significant milestone of the process improvements we've implemented over the last year that has allowed us to stabilize challenges in the manufacturing environment and excel operationally," said Brent Yeagy, Wabash president and CEO.
Wabash successfully pursued changes in its supply chain, handled incoming information from chassis makers and found ways to use its existing capacity to grow its final mile business, Yeagy said.
"In any environment, 140 basis points of overall operating margin improvement is a significant accomplishment. Similarly, 580 basis points of margin expansion in Final Mile Products shows considerable underlying improvements," he said.
Wabash raised its full-year guidance to $1.67 per share, the midpoint of a narrower range of $1.64 to $1.70.
Commercial Trailer Products' net sales increased 12.0 million, or 3.3%, to $380 million. Operating income increased $4.1 million, or 12.5% to $36.5 million, or 9.6% of net sales.
Diversified Products' net sales declined $9.2 million, or 9%, to $93 million because of a business divestiture, which was partially offset by higher demand for tank trailers. Operating income was $7.2 million, or 7.7% of net sales.
Final Mile Products' net sales grew $26.5 million, or 30.4%, to $114 million. Operating income was $4.6 million, or 4.1% of net sales.
Wabash products include 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.
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