Wabash National Corporation

05/01/2026 | Press release | Distributed by Public on 05/01/2026 14:13

Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the "Quarterly Report") of Wabash National Corporation (together with its subsidiaries, "Wabash," "Company," "us," "we," or "our") contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements may include the words "may," "will," "estimate," "intend," "continue," "believe," "expect," "plan" or "anticipate" and other similar words. Forward-looking statements convey the Company's current expectations or forecasts of future events. Our "forward-looking statements" include, but are not limited to, statements regarding:
▪the cyclical nature of our business and impact of economic conditions on markets, customers, and demand for our products;
▪unfairly traded imports of dry vans and refrigerated trailers that may injure or threaten with injury America's domestic dry van and refrigerated trailer industry;
▪changes in our customer relationships or in the financial condition of our customers;
▪our backlog and indicators of the level of our future revenues;
▪reliance on information technology to support our operations and our ability to protect against service interruptions or security breaches;
▪use of artificial intelligence in our business and challenges in managing its use;
▪inflation;
▪reliance on a limited number of suppliers of raw materials and components, price increases of raw materials and components, and our ability to obtain raw materials and components;
▪our ability to attract and retain key personnel or a sufficient workforce;
▪our ability to execute on our long-term strategic plan and growth initiatives or to meet our long-term financial goals;
▪volatility in the supply of vehicle chassis and other vehicle components:
▪significant competition in the industries in which we operate, including offerings by our competitors of new or better products and services or lower prices, including foreign competitors who may be violating anti-dumping laws or benefitting from subsidization in their home countries;
▪our competition in the highly competitive specialized vehicle industry;
▪market acceptance of our technology and products or market share gains of competing products;
▪disruptions of manufacturing operations;
▪our ability to effectively manage, safeguard, design, manufacture, service, repair, and maintain our leased (or subleased) trailers;
▪our arrangement to wholly own Linq Venture Holdings LLC;
▪our ability to realize all of the expected enhanced revenue, earnings, and cash flow from our agreement to create Wabash Parts LLC;
▪current and future governmental laws and regulations and costs related to compliance with such laws and regulations;
▪changes to U.S. or foreign tax laws and the effects on our effective tax rate and future profitability;
▪changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences;
▪the effects of product liability and other legal claims;
▪climate change and related public focus from regulators and various stakeholders;
▪impairment in the carrying value of goodwill and other long-lived intangible assets;
▪our ability to continue a regular quarterly dividend;
▪our ability to generate sufficient cash to service all of our indebtedness;
▪our indebtedness, financial condition and fulfillment of obligations thereunder;
▪increased risks of international operations;
▪our ability to meet environmental, social, and governance ("ESG") expectations or standards or to achieve our ESG goals;
▪provisions of our Senior Notes which could discourage potential future acquisitions of us by a third party;
▪the risks related to restrictive covenants in our Senior Notes indenture and Revolving Credit Agreement (each, as defined below), including limits on financial and operating flexibility;
▪price and trading volume volatility of our common stock; and
▪assumptions relating to the foregoing.
Although we believe that the expectations expressed in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and are subject to inherent risks and uncertainties, such as those disclosed in this Quarterly Report. Important risks and factors that could cause our actual results to be materially different from our expectations include the factors that are disclosed in "Item 1A-Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2025. Each forward-looking statement contained in this Quarterly Report reflects our management's view only as of the date on which that forward-looking statement was made. We are not obligated to update forward-looking statements or publicly release the result of any revisions to them to reflect events or circumstances after the date of this Quarterly Report or to reflect the occurrence of unanticipated events, except as required by law.
Results of Operations
Three Months Ended March 31, 2026 Compared with the Three Months Ended March 31, 2025
Net Sales
Net sales in the first quarter of 2026, decreased $77.7 million, or 20.4%, compared to the first quarter of 2025. By business segment, prior to the elimination of intercompany sales, sales and related units sold were as follows (dollars in thousands):
Three Months Ended March 31, Change
2026 2025 Amount %
(prior to elimination of intersegment sales)
Sales by Segment
Transportation Solutions $ 250,176 $ 346,803 $ (96,627) (27.9 %)
Parts & Services 54,069 51,955 2,114 4.1 %
Eliminations (1,016) (17,868) 16,852
Total $ 303,229 $ 380,890 $ (77,661) (20.4 %)
New Units Shipped (units)
Trailers 5,378 6,290 (912) (14.5 %)
Truck bodies 1,527 3,000 (1,473) (49.1 %)
Total 6,905 9,290 (2,385) (25.7 %)
Used Units Shipped (units)
Trailers 30 36 (6) (16.7 %)
TS segment sales, prior to the elimination of intersegment sales, were $250.2 million for the first quarter of 2026, a decrease of $96.6 million, or 27.9%, compared to the first quarter of 2025. New trailers shipped during the first quarter of 2026 totaled 5,378 trailers compared to 6,290 trailers in the prior year period, a decrease of 14.5%, which was primarily driven by lower dry van shipments. New truck bodies shipped during the first quarter of 2026 totaled 1,527 truck bodies compared to 3,000 truck bodies in the prior year period, a decrease of 49.1%.
P&S segment sales, prior to the elimination of intersegment sales, were $54.1 million for the first quarter of 2026, an increase of $2.1 million, or 4.1%, compared to the first quarter of 2025. The overall increase in sales for this segment was due primarily to higher sales within our Services business of $1.7 million and the Aftermarket Parts business of $2.6 million, partially offset by a lower sales within our Components business of $2.0 million.
Cost of Sales
Cost of sales was $313.8 million in the first quarter of 2026, a decrease of $48.1 million, or 13.3%, compared to the prior year period. Cost of sales is comprised of material costs, a variable expense, and other manufacturing costs, comprised of both fixed and variable expenses, including direct and indirect labor, outbound freight, overhead expenses, and depreciation.
TS segment cost of sales was $265.7 million in the first quarter of 2026, a decrease of $72.7 million, or 21.5%, compared to the prior year period. The decrease in cost of sales, which was primarily driven by lower shipment volumes, was due to a decrease in material costs of $45.8 million, or 21.3%, along with a decrease in certain other manufacturing costs.
P&S segment cost of sales was $49.1 million in the first quarter of 2026, an increase of $7.8 million, or 18.8%, compared to the prior year period. The increase in cost of sales was driven by an increase in material cost of $4.2 million due to the increase in sales, as well as an increase in other overheads.
Gross Profit
Gross profit was $(10.6) million in the first quarter of 2026, a decrease of $29.6 million from the prior year period. Gross profit as a percentage of net sales was (3.5)% for the first quarter of 2026, compared to 5.0% for the same period in 2025. Gross profit by segment was as follows (dollars in thousands):
Three Months Ended March 31, Change
2026 2025 Amount %
Gross Profit by Segment
Transportation Solutions $ (15,516) $ 8,414 $ (23,930) (284.4 %)
Parts & Services 4,941 10,589 (5,648) (53.3 %)
Total $ (10,575) $ 19,003 $ (29,578) (155.6 %)
TS segment gross profit was $(15.5) million for the first quarter of 2026 compared to $8.4 million for the first quarter of 2025. Gross profit, prior to the elimination of intersegment sales, as a percentage of net sales, was (6.2)% in the first quarter of 2026 compared to 2.4% in the comparative 2025 period. The overall decrease in gross profit from the prior year period was primarily driven by a decrease in shipments with our dry van and truck body products accounting for approximately $9.3 million and $17.8 million, respectively, of the decrease in gross profit.
P&S segment gross profit was $4.9 million for the first quarter of 2026 compared to $10.6 million for the first quarter of 2025. Gross profit, prior to the elimination of intersegment sales, as a percentage of net sales, was 9.1% in the first quarter of 2026 compared to 20.4% in the 2025 period. The overall decrease in gross profit was primarily related to the increase in overheads due to facility start up, whose growth outpaced the increase in costs associated with higher sales, as well as lower sales within our Components business.
General and Administrative Expenses
General and administrative expenses for the first quarter of 2026 increased $336.8 million, or 110.5%, from the prior year period. The increase from the prior year period was driven by the impacts of the reversal of charges associated with the Product Liability Matter in the first quarter of 2025. As a percentage of net sales, general and administrative expenses were 10.6% for the first quarter of 2026 compared to (80.0)% for the first quarter of 2025. The overall increase in general and administrative expenses as a percentage of net sales was primarily attributable to the reduction of punitive damages awarded in a lawsuit, Eileen Williams, Elizabeth Perkins, et al. v. Wabash National Corporation, et al., filed in the Circuit Court of the City of St. Louis, Missouri (the "Product Liability Matter") in the first quarter of 2025. Excluding the impacts of the Product Liability Matter, general and administrative expenses as a percentage of net sales were 12.6% in the first quarter of 2026 as compared to 9.8% in the prior year period.
Selling Expenses
Selling expenses were $7.7 million in the first quarter of 2026, an increase of $1.3 million, or 21.0%, compared to the prior year period. The increase was primarily attributable to an increase in advertising and promotional expenses of $0.7 million. As a percentage of net sales, selling expenses were 2.5% for the first quarter of 2026 compared to 1.7% for the first quarter of 2025.
Amortization of Intangibles
Amortization of intangibles was $2.7 million during the first quarter of 2026 compared to $2.8 million in the prior year period. Amortization of intangibles was the result of expenses recognized for intangible assets recorded from previous acquisitions. The decrease from the prior year period is related to continued amortization of certain intangible assets recorded upon the acquisition of Supreme in September 2017.
Other Income (Expense)
Interest expense totaled $6.2 million during the first quarter of 2026 and $5.0 million during the first quarter of 2025. Interest expense relates to interest and non-cash accretion charges on our Senior Notes and Revolving Credit Agreement.
Other, net for the first quarter of 2026 was nominal as compared to income of $1.6 million for the prior year period. Income for the current and prior year periods primarily relate to interest income.
Income Taxes
We recognized an income tax benefit of $13.0 million in the first quarter of 2026 compared to income tax expense of $78.1 million for the same period in the prior year. The effective tax rate for this period was 22.4% compared to a rate of 25.3% for the same period in the prior year. The effective tax rate for both the first quarter of 2026 and the first quarter of 2025 differs from the U.S. Federal statutory rate of 21% primarily due to the impact of state taxes. Net cash refunds for income taxes in the first quarter of 2026 were $10.3 million compared to net cash refunds of $0.2 million in the first quarter of 2025. The increase in net cash refunds in the first of quarter of 2026 compared to the same period of 2025 was due to timing of federal refunds from previously filed tax returns.
Liquidity and Capital Resources
Capital Structure
Our capital structure is comprised of a mix of debt and equity. As of March 31, 2026, our debt-to-equity ratio was approximately 1.6:1.0. Our long-term objective is to generate operating cash flows sufficient to support the growth within our businesses and increase shareholder value. This objective will be achieved through a balanced capital allocation strategy of sustaining strong liquidity, maintaining healthy leverage ratios, investing in the business both organically and strategically, and returning capital to our shareholders. Our Board of Directors designated a Finance Committee to assist the Board in overseeing the Company's capital structure, financing, investment, and other financial matters of importance.
During the first three months of 2026, in keeping with this balanced approach, we paid approximately $3.5 million in quarterly dividends to common stock shareholders. Additionally, as described in the "Debt Agreements and Related Amendments" section below, in September of 2022 we amended our Revolving Credit Agreement. The amendment increased the total revolving commitments to $350.0 million and extended the maturity to September 2027, the nearest maturity date of our long-term debt. As of March 31, 2026, there was $100.0 million outstanding under the Revolving Credit Agreement. Collectively, these demonstrate our confidence in the Company's long-term financial outlook and ability to generate cash flow both near and long term. They reinforce our commitment to delivering shareholder value while maintaining the flexibility to execute our strategic plan for profitable growth and diversification.
Our liquidity position, defined as cash on hand and available borrowing capacity under the Revolving Credit Facility, was $165.1 million as of March 31, 2026, compared to $310.0 million at March 31, 2025 and $235.3 million at December 31, 2025, representing decreases of 47% and 30%, respectively. These decreases in liquidity as of March 31, 2026 compared to both March 31, 2025 and December 31, 2025 were primarily attributable to a lower available capacity on the Revolving Credit Agreement and a lower cash balance as of March 31, 2026.
For the remainder of 2026, we expect to continue our commitment to fund working capital requirements and capital expenditures from net cash provided by operations or available borrowing capacity under the Revolving Credit Agreement, as needed. Along with these investments, we will maintain our assets to react to any economic and/or industry changes, while also responsibly returning capital to our shareholders. We will continue to move rapidly to adjust to the current environment and preserve the strength of our balance sheet, while prioritizing the safety of our employees and ensuring the liquidity and financial well-being of the Company.
Debt Agreements and Related Amendments
Senior Notes
On October 6, 2021, we closed on an offering of $400 million in aggregate principal amount of its 4.50% unsecured Senior Notes (the "Senior Notes"). The Senior Notes were issued pursuant to an indenture dated as of October 6, 2021, by and among us, certain subsidiary guarantors named therein (the "Guarantors") and Computershare Trust Company, N.A., as trustee (the "Indenture"). The Senior Notes bear interest at the rate of 4.50% and pay interest semi-annually in cash in arrears on April 15 and October 15 of each year. The Senior Notes will mature on October 15, 2028.
We may redeem some or all of the Senior Notes at redemption prices (expressed as percentages of principal amount) equal to 101.125% for the twelve-month period beginning October 15, 2025 and 100.000% beginning on October 15, 2026, plus accrued and unpaid interest to, but not including, the redemption date. Upon the occurrence of a Change of Control (as defined in the Indenture), unless we have exercised its optional redemption right in respect of the Senior Notes, the holders of the Senior Notes will have the right to require us to repurchase all or a portion of the Senior Notes at a price equal to 101% of the aggregate principal amount of the Senior Notes, plus any accrued and unpaid interest to, but not including, the date of repurchase.
The Senior Notes are guaranteed on a senior unsecured basis by all direct and indirect existing and future domestic restricted subsidiaries, subject to certain restrictions. The Senior Notes and related guarantees are our and the Guarantors' general unsecured senior obligations and will be subordinated to all of our and the Guarantors' existing and future secured debt to the extent of the assets securing that secured obligation. In addition, the Senior Notes are structurally subordinated to any existing and future debt of any of our subsidiaries that are not Guarantors, to the extent of the assets of those subsidiaries.
Subject to a number of exceptions and qualifications, the Indenture restricts our ability and the ability of certain of our subsidiaries to: (i) incur additional indebtedness; (ii) pay dividends or make other distributions in respect of, or repurchase or redeem, our capital stock or with respect to any other interest or participation in, or measured by, our profits; (iii) make loans and certain investments; (iv) sell assets; (v) create or incur liens; (vi) enter into transactions with affiliates; and (vii) consolidate, merge or sell all or substantially all of our assets. These covenants are subject to a number of important exceptions and qualifications.
During any time when the Senior Notes are rated investment grade by at least two of Moody's, Fitch and Standard & Poor's Ratings Services and no Default (as defined in the Indenture) has occurred and is continuing, many of such covenants will be suspended and we and our subsidiaries will cease to be subject to such covenants during such period.
The Indenture contains customary events of default, including payment defaults, breaches of covenants, failure to pay certain judgments and certain events of bankruptcy, insolvency and reorganization. If an event of default occurs and is continuing, the principal amount of the Senior Notes, plus accrued and unpaid interest, if any, may be declared immediately due and payable. These amounts automatically become due and payable if an event of default relating to certain events of bankruptcy, insolvency or reorganization occurs. As of March 31, 2026, we were in compliance with all covenants.
From time to time we may evaluate various alternatives available with respect to addressing the October 2028 maturity of the Senior Notes, including the purchase, redemption, refinancing, amending, exchanging, extending or otherwise retiring any amount of our outstanding indebtedness at any time, in open market or privately negotiated transactions with the holders of such indebtedness or otherwise. No final decisions have been made at this time, and the timing, structure and terms of any such transactions will depend on capital market conditions and other relevant factors.
Contractual coupon interest expense and accretion of fees for the Senior Notes for both three-month periods ended March 31, 2026 and March 31, 2025 was $4.5 million and $0.2 million, respectively. Contractual coupon interest expense and accretion of fees for the Senior Notes are included in Interest expense in the Company's Condensed Consolidated Statements of Operations.
Revolving Credit Agreement
On September 23, 2022, we entered into the Third Amendment to Second Amended and Restated Credit Agreement among us, certain of our subsidiaries as borrowers (together with us, the "Borrowers"), certain of our subsidiaries as guarantors, the lenders party thereto, and Wells Fargo Capital Finance, LLC, as the administrative agent (the "Agent"), which amended our existing Second Amended and Restated Credit Agreement, dated as of December 21, 2018 (as amended from time to time, the "Revolving Credit Agreement").
Under the Revolving Credit Agreement, the lenders agree to make available a $350 million revolving credit facility (the "Revolving Credit Facility") to the Borrowers with a scheduled maturity date of September 23, 2027. We have the option to increase the total commitments under the Revolving Credit Facility by up to an additional $175 million, subject to certain conditions, including obtaining agreements from one or more lenders, whether or not party to the Revolving Credit Agreement, to provide such additional commitments. Availability under the Revolving Credit Agreement is based upon quarterly (or more frequent under certain circumstances) borrowing base certifications of the Borrowers' eligible inventory, eligible leasing inventory and eligible accounts receivable, and is reduced by certain reserves in effect from time to time.
Subject to availability, the Revolving Credit Agreement provides for a letter of credit subfacility in the amount of $25 million and allows for swingline loans in the amount of $35 million. Outstanding borrowings under the Revolving Credit Agreement bear interest at an annual rate, at the Borrowers' election, equal to (i) adjusted term Secured Overnight Financing Rate plus a margin ranging from 1.25% to 1.75% or (ii) a base rate plus a margin ranging from 0.25% to 0.75%, in each case depending upon the monthly average excess availability under the Revolving Credit Agreement. The Borrowers are required to pay a monthly unused line fee equal to 0.20% times the average daily unused availability along with other customary fees and expenses of the Agent and the lenders.
The Revolving Credit Agreement is guaranteed by certain of our subsidiaries (the "Guarantors") and is secured by substantially all personal property of the Borrowers and the Guarantors.
The Revolving Credit Agreement contains customary covenants limiting our ability and certain of our subsidiaries to, among other things, pay cash dividends, incur debt or liens, redeem or repurchase stock, enter into transactions with affiliates, merge, dissolve, repay subordinated indebtedness, make investments and dispose of assets. In addition, we will be required to maintain a minimum fixed charge coverage ratio of not less than 1.0 to 1.0 as of the end of any period of 12 fiscal months when excess availability under the Revolving Credit Agreement is less than the greater of (a) 10.0% of the lesser of (i) the total revolving commitments and (ii) the borrowing base (such lesser amount, the "Line Cap") and (b) $25 million. As of March 31, 2026, we were in compliance with all covenants.
If availability under the Revolving Credit Agreement is less than the greater of (i) 10% of the Line Cap and (ii) $25 million for three consecutive business days, or if there exists an event of default, amounts in any of the Borrowers' and the Guarantors' deposit accounts (other than certain excluded accounts) will be transferred daily into a blocked account held by the Agent and applied to reduce the outstanding amounts under the facility.
The Revolving Credit Agreement contains customary events of default. If an event of default occurs and is continuing, the lenders may, among other things, require the immediate payment of all amounts outstanding and foreclose on collateral. In addition, in the case of an event of default arising from certain events of bankruptcy or insolvency, the lenders' obligations under the Revolving Credit Agreement would automatically terminate, and all amounts outstanding under the Revolving Credit Agreement would automatically become due and payable.
During the three-month period ended March 31, 2026, we had payments of principal totaling $56.3 million and borrowings of principal totaling $111.3 million under the Revolving Credit Agreement. As of March 31, 2026, there was $100.0 million outstanding under the Revolving Credit Agreement.
During the three-month period ended March 31, 2025, we had payments of principal totaling $0.4 million and borrowings of principal totaling $20.4 million under the Revolving Credit Agreement. As of March 31, 2025, there was $20.0 million outstanding under the Revolving Credit Agreement.
Interest expense under the Revolving Credit Agreement for each three-month period ended March 31, 2026 and March 31, 2025 was approximately $1.4 million and $0.3 million, respectively. Interest expense under the Revolving Credit Agreement is included in Interest expense in the Company's Condensed Consolidated Statements of Operations.
Cash Flows
Cash used in operating activities for the first three months of 2026 totaled $33.7 million, compared to using $0.3 million during the same period in 2025. Cash used in operations during the current year period was the result of net income (loss) without the adjustment for a large non-cash reduction in legal matter expenses that occurred in the same period of 2025. Changes in key working capital accounts for 2026 and 2025 are summarized below (in thousands):
Three Months Ended March 31,
2026 2025 Change
Source (Use) of cash:
Accounts receivable $ (38,719) $ (27,747) $ (10,972)
Inventories (17,136) (19,823) 2,687
Accounts payable and accrued liabilities 64,202 73,227 (9,025)
Net source (use) of cash
$ 8,347 $ 25,657 $ (17,310)
Accounts receivable increased $38.7 million in the first three months of 2026 as compared to a $27.7 million increase in the prior year period. Days sales outstanding, a measure of working capital efficiency that measures the amount of time a receivable is outstanding, was 48 days and 41 days for the three months ended March 31, 2026 and 2025, respectively. Inventory increased by $17.1 million during the first three months of 2026, compared to an increase of $19.8 million in the same 2025 period. Our inventory turns, a commonly used measure of working capital efficiency that measures how quickly inventory turns per year, was approximately 6.9 times in the period ended March 31, 2026, an increase of 1.2 times from the same 2025 period. Accounts payable and accrued liabilities increased by $64.2 million during the first three months of 2026 compared to an increase of $73.2 million for the same period in 2025. Days payable outstanding, a measure of working capital efficiency that measures the amount of time a payable is outstanding, was 61 days for the period ended March 31, 2026 compared to 53 days for the period ended March 31, 2025.
Investing activities used $4.3 million during the first three months of 2026, as compared to using $33.8 million during the same period in 2025. Investing activities for the first three months of 2026 related to capital expenditures for property, plant, and equipment of $3.4 million, $0.2 million for revenue generating assets and an additional $6.2 million for an investment in an unconsolidated entity. Investing activities for the first three months of 2025 related to capital expenditures for property, plant, and equipment of $8.7 million.
Financing activities provided $49.5 million during the first three months of 2026 as compared to using $0.4 million during the same period in 2025. Net cash provided by financing activities during the current year period primarily relates to net borrowings under our Revolving Credit Agreement of $55 million partially offset by common stock repurchases and withholdings of $0.0 million and cash dividend payments of $3.5 million. Net cash used by financing activities during the first three months of 2025 primarily related to common stock repurchases and withholdings of $16.5 million and cash dividend payments to our shareholders of $3.9 million. In addition, borrowings under our Credit Agreement totaled $20.4 million, fully offset by principal, interest, and unused fee payments made under our Credit Agreement of $0.4 million.
As of March 31, 2026, our liquidity position, defined as cash on hand and available borrowing capacity under our Revolving Credit Agreement, amounted to $165.1 million. This represents a decrease of $144.9 million, or 47%, compared to March 31, 2025, and a decrease of $70.2 million, or 30%, compared to December 31, 2025. The decrease in liquidity as of March 31, 2026, compared to March 31, 2025 was primarily attributable to a lower available capacity on the Revolving Credit Agreement partially offset by a higher cash balance as of March 31, 2026. The decrease as of March 31, 2026 compared to December 31, 2025, was primarily attributable to lower available capacity on the Revolving Credit Agreement and a lower cash balance. Total debt obligations amounted to $500.0 million as of March 31, 2026.
For the remainder of 2026, we expect to continue our commitment to fund our working capital requirements, capital expenditures, and our Trailers as a Service (TAAS)SM initiative from operations or available borrowing capacity under the Revolving Credit Agreement (as needed). We will continue to maintain our assets, to react to any key economic and/or industry changes, while also responsibly returning capital to our shareholders. We will continue to move rapidly to adjust to the current environment, including to the softening of demand for certain of our products, to preserve the strength of our balance sheet, while prioritizing the safety of our employees and ensuring the liquidity and financial well-being of the Company.
Capital Expenditures
Capital spending related to property, plant, and equipment amounted to approximately $3.4 million for the first three months of 2026. In addition, there were $0.2 million in expenditures for revenue generating assets for the first three months of 2026.
Capital spending and expenditures for revenue generating assets for 2026 are being evaluated to ensure that future investments align with market conditions and opportunities.
Goodwill
We considered whether there were any indicators of impairment during the three months ended March 31, 2026 and concluded there were none.
Contractual Obligations and Commercial Commitments
A summary of payments of our contractual obligations and commercial commitments, both on and off balance sheet, as of March 31, 2026 are as follows (in thousands):
2026 2027 2028 2029 2030 Thereafter Total
Debt:
Revolving Credit Agreement (due 2027) $ - $ - $ 100,000 $ - $ - $ - $ 100,000
Senior Notes (due 2028) - - 400,000 - - - 400,000
Interest payments on Revolving Credit Agreement and Senior Notes(1)
21,957 21,825 18,000 - - - 61,782
Total debt 21,957 21,825 518,000 - - - 561,782
Other:
Operating Leases 9,037 9,479 7,630 5,854 3,922 991 36,913
Total other 9,037 9,479 7,630 5,854 3,922 991 36,913
Other commercial commitments:
Letters of Credit 5,615 - - - - - 5,615
Raw Material Purchase Commitments 26,628 48 - - - - 26,676
Chassis Agreements and Programs 46,272 - - - - - 46,272
Total other commercial commitments 78,515 48 - - - - 78,563
Total obligations $ 109,509 $ 31,352 $ 525,630 $ 5,854 $ 3,922 $ 991 $ 677,258
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(1) Future interest payments on variable rate long-term debt are estimated based on the rate in effect as of March 31, 2026, and only include interest payments (not unused line fees).
Borrowings under the Revolving Credit Agreement bear interest at a variable rate based on the Secured Overnight Financing Rate ("SOFR") or a base rate determined by the lender's prime rate plus an applicable margin, as defined in the agreement. Any outstanding borrowings under the Revolving Credit Agreement bear interest at a rate, at our election, equal to (i) adjusted term SOFR plus a margin ranging from 1.25% to 1.75% or (ii) a base rate plus a margin ranging from 0.25% to 0.75%, in each case depending upon the monthly average excess availability under the Revolving Credit Agreement. We are required to pay a monthly unused line fee equal to 0.20% times the average daily unused availability along with other customary fees and expenses of our agent and lenders. During the three-month period ended March 31, 2026, we had payments of principal totaling $56.3 million and borrowings of principal totaling $111.3 million under the Revolving Credit Agreement. As of March 31, 2026, there was $100.0 million outstanding under the Revolving Credit Agreement.
The Senior Notes bear interest at the rate of 4.5% per annum from the date of issuance, payable semi-annually on April 15 and October 15.
Operating leases represent the total future minimum lease payments that have commenced. As of March 31, 2026, obligations related to operating leases that we have executed but have not yet commenced were insignificant.
We have standby letters of credit totaling $5.6 million issued in connection with workers compensation claims and surety bonds.
We have $26.7 million in purchase commitments through January 2027 for various raw material commodities, including aluminum and nickel as well as other raw material components which are within normal production requirements.
We obtain vehicle chassis for our specialized vehicle products directly from the chassis manufacturers under converter pool agreements. Chassis are obtained from the manufacturers based on orders from customers, and in some cases, for unallocated orders. The agreements generally state that the manufacturer will provide a supply of chassis to be maintained at our facilities with the condition that we will store such chassis and will not move, sell, or otherwise dispose of such chassis except under the terms of the agreement. In addition, the manufacturer typically retains the sole authority to authorize commencement of work on the chassis and to make certain other decisions with respect to the chassis including the terms and pricing of sales of the chassis to the manufacturer's dealers. The manufacturer also does not transfer the certificate of origin to us nor permit us to sell or transfer the chassis to anyone other than the manufacturer (for ultimate resale to a dealer). Although we are party to related finance agreements with manufacturers, we have not historically settled, nor expect to in the future settle, any related obligations in cash. Instead, the obligation is settled by the manufacturer upon reassignment of the chassis to an accepted dealer, and the dealer is invoiced for the chassis by the manufacturer. Accordingly, as of March 31, 2026 our outstanding chassis converter pool with the manufacturer totaled $46.3 million and we have included this financing agreement on our Condensed Consolidated Balance Sheets within Other accrued liabilities. Under this agreement, if the chassis is not delivered to a customer within a specified time frame, we are required to pay a finance or storage charge on the chassis. Additionally, we receive finance support funds from manufacturers when the chassis are assigned into our chassis pool. Typically, chassis are converted and delivered to customers within 90 days of our receipt of the chassis.
Backlog
Orders that have been confirmed by customers in writing and have defined delivery timeframes are included in our backlog. Orders that comprise our backlog may be subject to changes in quantities, delivery, specifications, terms, or cancellation. The following table presents backlog information as of March 31, 2026, December 31, 2025, and March 31, 2025 (in millions):
March 31, 2026 December 31, 2025 Change March 31, 2026 March 31, 2025 Change
12-month backlog $ 738 $ 576 28% $ 738 $ 841 (12)%
Total backlog $ 837 $ 705 19% $ 837 $ 1,224 (32)%
The increase in rolling 12-month backlog and total backlog from December 31, 2025 is primarily attributable to the placement of new orders during the first three months of 2026 outpacing shipments. The decrease in rolling 12-month backlog and total backlog from March 31, 2025 is primarily related to the softened new trailer and truck body demand stemming from expectations of the 2026 markets.
We continue to believe that our long-term relationship agreements with certain strategic customers will provide a good base of backlog for years to come. Refer to the "Outlook" section below for additional details related to industry and market conditions.
Outlook
The trailer industry generally follows the transportation industry's cycles. According to ACT Research Company ("ACT"), total United States trailer production in 2025 was approximately 190,000 trailers, a 19.8% decrease from 2024. There remains uncertainty in the industry, including but not limited to overall economic conditions and softening of demand for certain of our products, which is reflected in market outlooks. Current estimates from ACT and FTR Associations ("FTR") for 2026 United States trailer production are 188,000 and 178,000, respectively, representing a 1.1% and 7.3% decrease, respectively compared to 2025.
ACT is forecasting annual new trailer production levels for 2027, 2028, 2029, 2030, and 2031 of approximately 259,000, 296,000, 314,000, 290,000, and 298,000, respectively. In addition, FTR is forecasting annual new trailer production levels for 2027, 2028, 2029, 2030 of approximately 225,000, 276,000, 298,000, and 301,000, respectively. These estimates are generally consistent with historical trailer industry production levels. However, overall economic uncertainty and softening demand in the industry for certain of our products could continue to impact these estimates. This uncertainty and softening are evident in the ACT and FTR forecasts, particularly for 2026 production. However, we believe that our strategic plan and actions taken over the last several years have positioned us to remain well-suited to adapt to changes in the industry and demand environment due to our strong balance sheet, liquidity profile, and diversification.
Other potential risks we face for the remainder of 2026 primarily relate to our ability to effectively manage our manufacturing operations, including economic uncertainty and the uncertainty caused by recently enacted and proposed tariffs and the related disruptions to international trade, and our overall business. In addition, the cost of raw materials, commodities, and components are also potential risks. Significant increases in the cost of certain commodities, raw materials or components, including increases due to the imposition, or proposed imposition, of tariffs have had, and may continue to have, an adverse effect on our results of operations. As has been our practice, we will endeavor to pass raw material and component price increases to our customers in addition to continuing our cost management and hedging activities in an effort to minimize the risk that changes in material costs could have on our operating results. In addition, we rely on a limited number of suppliers for certain key components and raw materials in the manufacturing of our products, including tires, landing gear, axles, suspensions, aluminum extrusions, chassis and specialty steel coil. While we have taken actions to mitigate certain of these risks, which include our previously announced supply agreements at the current and expected demand levels, there may be additional or increased shortages of supplies of raw materials or components which would have an adverse impact on our ability to meet demand for our products. Despite these risks, we believe we are well positioned to capitalize on overall demand when it returns to normalized levels.
For the remainder of 2026, we will continue to adjust to changes in the current environment, preserve the strength of our balance sheet, prioritize the safety of our employees, and ensure the liquidity and financial well-being of the Company. We believe we remain well-positioned for both near-term and long-term success in the transportation, logistics, and distribution industries because: (1) our core customers are among the major participants in the transportation, logistics, and distribution industries; (2) our technology and innovation provide value-added solutions for our customers by reducing operating costs, improving revenue opportunities, and solving unique transportation problems; (3) our Wabash Management System ("WMS") principles and processes and enterprise-wide lean efforts drive focus on the interconnected processes that are critical for success across our business; (4) our significant brand recognition, presence throughout North America, and the utilization of our extensive dealer network to market and sell our products; and (5) our One Wabash approach to create a consistent, superior experience for all customers who seek our connected solutions in the transportation, logistics, and distribution markets. By continuing to be an innovation leader in the transportation, logistics, and distribution industries we expect to leverage our existing assets and capabilities into higher margin products and markets by delivering connected, value-added customer solutions.
Critical Accounting Policies and Estimates
We have included a summary of our Critical Accounting Policies and Estimates in our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes to the summary provided in that report.
Wabash National Corporation published this content on May 01, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on May 01, 2026 at 20:13 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]