Wabash National Corporation · NYSE:WNC
Wabash National — BB&T Capital Markets Logistics & Transport Conference 2003
22 slides from Wabash National's conference presentation, Nov 6, 2003
Slide 1: BB&T Capital Markets Logistics & Transport Conference - November 5 & 6, 2003
(r) BB&T Capital Markets Logistics & Transport Conference - November 5 & 6, 2003 William P. Greubel, President & CEO Mark R. Holden - Senior Vice President & CFO
Slide 2: Forward-Looking Statements
This presentation will contain certain forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are, however, subject to certain risks and uncertainties that could cause actual results to differ materially from those implied by
Slide 3: Company Overview
Founded as start-up in 1985 Rapid growth throughout 1990s - revenue focused #1 industry position since 1994 Leading innovator of proprietary products Long-standing sole-sourced customer partnerships Dedicated union-free workforce ~40,000 trailer annual production (2003 estimate) vs. ~70,000 peak (19
Slide 4: Leading Product Innovation - DuraPlate
Proprietary composite trailers offer customers several advantages vs. standardized equipment Low maintenance cost Increased durability Enhanced trade in values Reduced total cost of ownership Competitive financing 1997 1998 1999 2000 2001 2002 YTD 9/30/03 Annual Capacity East 7288 17983 36649 36755
Slide 5: Core Customers
Core Customers SCHNEIDE! . | YELLOW U.S. XPRESS d yn ENTERPRISES, INC. neki Trz=ple Crown ke : wages 3
Slide 6: Consolidation Trend Continues
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Other 0.8 27.4 90 20.4 Top Ten Carriers 0.2 Consolidation Trend Continues 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Other 0.89 27.4 90 20.4 Top Ten Carriers 0.11 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Other 0.99 27.4 90 20.4 Top Ten Carriers 0.01 Other - 99% Top-10 Carriers - 1% 1980
Slide 7: Transportation Equipment Linkages
Transportation Equipment Linkages Historically, 1.5 trailers have been built for each Class 8 HDD truck Truckers generally operate their fleets with three trailers for each tractor U.S. Trailers & Chassis and U.S. Class 8 HDD Trucks Build Ratio Ratio Data Source: ACT Publications 1996 1997 1998 1999
Slide 8: Positive Industry Momentum
Positive Industry Momentum Units Data Source: ACT Publications 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003E 2004E 2005E 2006E Total Trailers 179000 173000 164000 161000 161000 147677 120156 162881 185304 233189 279242 202952 235517 285230 318788 275
Slide 9: Executing Operational/Financial Turnaround - Phase I
Executing Operational/Financial Turnaround Working Capital Optimization Operational Excellence Recapitalization Inventory optimization Receivables management Payables management Safety Quality Capacity Productivity Standardization Branch optimization Convertible notes Bank facility Asset sales Excee
Slide 10: Executing Operational/Financial Turnaround - Phase II
Executing Operational/Financial Turnaround Operational Excellence Revenue and Earnings Growth Debt Reduction Continuous improvement Branch profitability S,G&A reductions Grow with cycle Technology innovation Maintain/Grow with partners Growth in mid- market Continue to hammer on operational improvem
Slide 11: Top Line Growth: Share Growth in Mid Market
Top Line Growth : Share Growth in Mid Market 25% market share goal by the end of 2005 Available capacity, little capital investment necessary Richer product mix WNC has historically focused on large- fleets Mid-market represents ^ 1 million trailers (approx. 100,000 purchased/yr) WNC has < 10% of th
Slide 12: Building Dedicated and Talented Team
Production associates have remained union-free and are now empowered with change initiatives Management infusion brings best practices from diverse industries, including automotive Professional management team expanded Achieved dramatic positive results within 24 months Strengthened fiscal disciplin
Slide 13: Developments Affecting Future Trailer Demand
Developments Affecting Future Trailer Demand Industry WNC Development Impact Impact 1) 2007 Emission Standards (-) (-) Potential pre-buy effect 2) Technology (-) Neutral Improved trailer utilization Lower trailer-to-tractor ratios DuraPlate - extended trailer lives 3) Federal Hours-of-Service Rules
Slide 14: Financial Review
Financial Review
Slide 15: The Heavy Lifting Has Been Done
The Heavy Lifting Has Been Done Rationalized manufacturing capacity (Q-4-01) Closed 2 of 3 plants Significant structural cost changes Normalized used trailer inventories (Q-3-01: Q-3-03) Reduced from $110 million (11,500 units) to $16 million (3,000 units) Resolved legacy trade-in practices Reduced
Slide 16: Improved Liquidity Position
Improved Liquidity Position $ in millions $
Slide 17: Significant Debt Repayment
Significant Debt Repayment Dec-01 Mar-02 Jun-02 Sep-02 Dec-02 Mar-03 June-03 Sep-03 Dec-03 adf 455 454 393 388 345 339 330 293 253 Total Debt ($ in millions) $100 million debt repaid in 2002; another $100 million planned for 2003 43% Debt Reduction $73 million debt reduction thru 9/30/03 Will exceed
Slide 18: Recapitalization
1) $125 million Senior Unsecured Convertible Notes Closed August 2003 3 1/4%; 5 year maturity Convertible into 6.5 million shares @ $19.27 Non-core Asset Sales Rental and leasing Wholesale aftermarket parts Finance portfolio Closed branch properties 3) New $222 million, 3 year Asset Based Loan Close
Slide 19: Improved Capital Structure
Improved Capital Structure $ in millions Cost of debt reduced from over 10% to less than 4% Interest expense reduction from $36 million to $14 million Potential to be debt-free in 2005
Slide 20: Structural Margin Improvement
Structural Margin Improvement Achieving peak margins today, yet at only 56% of peak volumes Source: ACT and Company Management
Slide 21: Summary
Summary
Slide 22: Mj ; Re
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