According to Mark Holden, senior vp & CFO, the suspension of dividend payments is necessary given the continuing difficult economic and industry environment for Wabash.
"Declining business conditions sustained during this past year have been unprecedented for Wabash and the trailer manufacturing industry," Holden said. "Given current industry forecasts, the company's board of directors believes that focusing Wabash's full resources toward the operational needs of the business is the most prudent course of action at this time."
Lafayette, IN-based Wabash took several financial hits in 2001. The company said it lost a whopping $61.4 million in the third quarter of 2001, compared to income of $5 million in the same period of 2000, because of declining sales. For the first nine months of 2001, Wabash's net sales dropped by nearly 30% to $697 million, with losses rising to $97 million.
The company closed manufacturing plants in Ft. Madison, IA, and Scott County, TN, a California parts distribution facility, and resorted to layoffs last year to save money. But those initiatives also forced Wabash to take a $40.5 million pre-tax restructuring charge - along with a $28.7-million pre-tax charge related to its reduction plans for used trailer inventories. Of the total $69.2 million in pre-tax charges recorded during the third quarter, approximately $3 million were cash-related charges.