Wabash National Corporation (NYSE:WNC) Q4 2022 Earnings Call Transcript

Mike Pettit: Jeff, just to dial it in a little bit closer for 2023, like you mentioned, we’ll probably ramp up to full line rate throughout the year. So for all of 2023 figuring that we’re a little – running a little slower in the first half, a little faster in the second half, we’re looking at about 7,500 units out of that facility this year and then like Brent said, longer term that goes to 10,000.

Jeff Kauffman: Okay that helps with my math there. That’s fantastic. Well, I got to tell you this is awesome to see. I wish I had a buy rating on the stock. I don’t but this is fantastic to see everything you’ve worked so hard for coming around your way. So congratulations.

Brent Yeagy: Thanks Jeff.

Operator: The next question is from Felix Boeschen with Raymond James. Your line is open.

Felix Boeschen: I just wanted to quickly follow-up on the CapEx of, call it, close to $100 million. I’m just curious if you’re able to provide some context to maybe dissect that between, say, the dry van capacity spillover, maybe EcoNex, maintenance CapEx and then some other growth projects you have in there?

Mike Pettit: Yes, the three main drivers by far are the capacity addition that’s going to be somewhere in the 40% to 50% of that number, that – as I mentioned there’s some flow through from ’22, we’ve got EcoNex would be the next biggest driver of our Little Falls plant expansion. And the next one would be some significant growth in our Parts & Services initiatives and with some technology spend in there that will help us ramp in ’22, really that – those benefits will be in ’24 and beyond. And then there’s always that $25 million-ish of cost of doing business to maintain 14 manufacturing facilities, but those are the big drivers of the growth initiatives within CapEx.

Felix Boeschen: Got it. And then just on the parts and services. I appreciate the bridge on the strong year-over-year EPS contribution coming out of that, and I’m just wondering is there much baked in from trailer as a service at this point or should we think about that as being more of a longer-term story?

Mike Pettit: Yes, I’d view that more as a longer-term story Felix, it’s interesting because we view trailers as a services because it does a product offering within our Parts & Services and what we’re trying to – how we’re trying to develop our ability to maintain trailers in the field. And as I mentioned, a synergistic way that helps support our dealer network and our customers. But the actual big trailers as service growth you’re going to see will probably be in ’24 and beyond. We will talk about more in upcoming calls. I did mentioned, we do – we’ll do a few million this year first half of the year in the trailers, we say this from a leasing perspective as we then come on the balance sheet, but the big driver from a revenue and EPS generation will be 2024 and beyond.