Welcome to the Fourth Quarter and Year-End Earnings Call. My name is John, and I'll be your operator for today's call. [Operator Instructions]. I'll now turn the call over to Mike Pettit.

Thank you, John, and good morning. Welcome everyone to the Wabash National Corporation 2014 Fourth Quarter and Full-Year Earnings Call. This is Mike Pettit, Vice President of Finance and Investor Relations. Following this introduction, you’ll hear from Dick Giromini, Chief Executive Officer of Wabash National on the highlights of the Fourth Quarter and Full-Year 2014, the current operating environment and the 2015 outlook. After Dick, Jeff Taylor, our Chief Financial Officer will provide a detailed description of our financial results. At the conclusion of the prepared portion of our presentation, we'll open the call for questions from the listening audience. Before we begin, I'd like to cover two quick items. First, please note that this call is being recorded. Second, as with all of these types of presentations, this morning's call contains certain forward-looking information including statements about the company's prospects, the industry outlook, backlog information, financial condition and other matters. As you know, actual results could differ materially than those projected in the forward-looking statements. These statements should be viewed being the cautionary statements and risk factors set forth from time-to-time in the company's filings with the Securities and Exchange Commission. With that, it is my pleasure to turn the call over to Dick.

Thanks, Mike. I will begin by saying that we are extremely pleased with the company's 2014 performance as it marked the fifth consecutive year of revenue and operating income growth, and the third consecutive year of record revenue and profitability. For the full-year 2014 revenue increased 14%, while operating income was up 18.6% over the prior year. Before addressing fourth quarter and full-year 2014 in detail, I’d like to highlight a few key elements that contributed to our record-setting year. 2014 delivered the year with a strong demand environment as trailer industry shipments finished approximately 15% above 2013 levels. A key performance driver for the business was Commercial Trailer Products’ ability to remain laser focused on margin growth through improved pricing, operational efficiency and supply chain optimization. This focus led to significantly improved margins year-over-year in the Commercial Trailer Products business that we will discuss more in a minute. A second key element for us in 2014 was the expansion of product lines within the Diversified Products segment. We launched a dry bulk pneumatic tank trailer through the Walker Group further broadening our industry-leading product portfolio. We also began manufacturing Beall brand products in Fond du Lac and Brenner brand products in Lafayette, leveraging our existing manufacturing footprint to better serve our customers and more quickly align production to demand. And there are more product initiatives planned for 2015. Our Retail segment also realized top and bottom line growth as the team was able to expand their customer site service locations along with increasing mobile service support helping them leverage their retail network utilizing an asset-light approach. These efforts contributed nicely to the bottom line in 2014 as we will highlight shortly. With that, I will provide some more color around our record-setting year. Revenue for the full-year 2014 was…

Thanks, Dick and good morning. Let me start by saying that we are obviously pleased with the full-year and fourth-quarter results. All areas of the business contributed to achieving the financial records that Dick mentioned and it really highlights the progress we made to grow and diversify the company. With that, let's begin with the fourth-quarter results. On a consolidated basis, revenue for the quarter was $527 million, an increase of $69 million or 15.1% compared to the fourth quarter of last year. This represents an all-time record for quarterly consolidated revenue. This year-over-year improvement in revenue is attributable to year-over-year improvement in all segments, most notably the strong demand in the Commercial Trailer Products segment. New Trailer shipments were 16,850 units during the quarter, 1300 units above the top end of our third quarter guidance on stronger-than-expected customer pickups driven by strong industry demand and fundamentals supported by favorable weather conditions. Sequentially consolidated revenue increased $36 million or approximately 7.3%, primarily driven by higher new trailer shipments in our Commercial Trailer Products segment. However every segment of the business reported sequential revenue growth. Commercial Trailer products net sales were $378 million which represents a $54 million or 16.7% increase year-over-year. This growth was driven by an increase in new trailer shipments as approximately 15,750 trailers shipped in the fourth quarter of 2014 compared to 13,450 trailers shipped in the prior year period in addition to improved selling prices. New trailer average selling prices or ASP increased approximately $600 per unit. Net pricing per unit improved by approximately $300, while the remainder of the ASP change was attributed to customer and product mix. On a sequential basis net sales for Commercial Trailer Products increased $26 million or 7.5% on approximately 1050 additional new trailer shipments. Diversified Products net sales on…

[Operator Instructions]. Our first question is from Joe Odea. Please go ahead.

Maybe first just on price and with the strength of the backlog, how you saw pricing trend in the order book into the end of the year? I think based on the numbers you gave in the prepared remarks, it sounds like price up may be a little over 1% year-over-year? Are you seeing that kind of accelerate as the backlog extends and just sort of underlying strength in the industry at all?

Yeah, we don’t break down specifically how much until obviously after the quarter we report on the results. But as we have stated in past calls, we continually push to improve pricing, to improve the net pricing so that the impact on margins is positive. We’ve had good success with that and the strong demand environment and you see the order book and what's happened there certainly supports that we’ve been able to make progress. We do year-over-year comparisons nameplate by nameplate, looking at customers a year ago versus orders, quotes and orders for the current year and for the following year and in every case pricing and net margin has improved with each customer. So we are seeing nice progress and with a strong environment we expect to see even greater strides in the coming year.

Okay and then just one more on the -- you know sort of continued progress within Diversified Products and what you see as the timing, both for the continued ramp up in the Composites facility. And then as well timing of some of the product introductions that you mentioned over the course of 2015, just to get a sense of you know some of the momentum that you have going from 3Q to 4Q on the margin expansion there. How we should think about over the course of 2015 getting back to the target range?

You know over the next two quarters, the first and second quarter of the year, the ramp up at the facility in Frankfurt will be occurring. The plant is already up in operation, but now they will be ramping up all of the new product offerings over the next two quarters and into the third quarter. So I would summarize that by saying by the time we get to the third quarter, we should be seeing gross margin profiles overall that would be more to what the past expectations and results were for the Diversified Products business.

Our next question is from Brad Delco. Please go ahead.

I may have missed this, so I was jumping off of another call to get on here, but my understanding you know 25% to 35% EPS growth guidance for this year. Clearly the topline trends are a little bit more transparent with your expectations on trailer deliveries, but can you maybe talk more specifically about what some of the inputs are that you’ve to sort of get to those numbers, may be more from a margin perspective?

Well as I stated to Joe, our expectations are relative to the Commercial Trailer Products business that we will continue to see margin improvement. We fully expect to achieve the previously stated objective of getting to double-digit margins, you know break that 10% barrier in the Commercial Trailer Products. We expect to do that this year. So there is one driver, the demand environment is giving us opportunity to push pricing more aggressively than what we had experienced in the last couple of years, so we should see that coming to fruition. And then the comments I made about the Diversified Products business, over the next couple of quarters they will continue to make some progress in ramping up the business and getting the new products introduced. That's going to help the Wabash Composites portion of it. The Walker business continues to run very strong, so they are delivering. So by the time we get to the third quarter, our expectation there is that we will be seeing the gross margins back into that 21% to 24% range that we had been enjoying for the first year, year and a half of ownership of that and when we combined them with the rest of the businesses in Diversified. So overall it’s a very strong environment. The volume certainly plays a part in you know providing leverage for the business. So we'll get some improved flow-through and that's going to improve margins as a result of the numbers. We talked about 60,000 to 64,000 units and 6% to 8% overall topline growth. So a combination of those activities and the continued operational improvements on the factory floor and a great job that our supply chain team does on leveraging from the purchasing standpoint of components and materials.

Just to add to that real quick, also on the retail side. I mean they are obviously benefiting from the strong demand in the trailer industry and they will continue to benefit in 2015 in addition to continuing to grow the customer site service activities that we have in that segment.

Got you and then Jeff, just to be clear the 25% to 35% growth, that's off of the adjusted [$0.89] number for 2013?

That's correct.

And then maybe one more question. Dick, one number that sort of stood out was the used trailer volumes. And I don't know if you commented on that, but is this going to be more of a sustainable trend going forward or what’s really driving these trailer volumes down relative to kind of where you guys have historically run?

Yeah, we’ve never focused on used trailer as being a real important area of the business. We generally take trade packages for new trailer sales opportunities. Customers will want to trade their old equipment. In some market environments, that makes sense, in others it doesn't. In the current environment with the Dry Van segment, most some customers are deciding to sell those trailers on their own. So they are not making them as part of trade packages. On the refrigerated front, a little different story. There’s a glut of aged equipment out in the market place and they are not attractive to take as trade packages. So again consistent with our margin-over-volume approach, we're being very selective on which trade packages we're accepting. And we willingly walk away from opportunities. If the combination of the trade value that the customer expects and the price for the new equipment that the customer expects don't make sense to us, then we walk away from it.

Our next question is from Alex Potter. Please go ahead.

I was hoping you could flush out, I guess the growth rates within DPG. So what some of the faster and slowing growing segments are specifically within Walker? I know they have got a pretty diverse end market exposure. So I was just hoping you could comment on where you are seeing strength, relative strength and relative weakness?

Yeah, you know we unfortunately don't get into the details of the individual pieces within the segment. But you know, we made comments that obviously the Walker business is a very stable business. We expect that to continue to grow. The Composites business has been a growing business for us over the last three or five years and we certainly expect that to continue. And then obviously the Wood Products really follows the Core Trailer business pretty closely. So hopefully that gives you some you know qualitative guidance you can use there.

Okay, how about on the pricing pressure you were mentioning in the Composites. Is it possible to I guess shed some additional light on that topic particularly?

Yeah sure, the specific area that was feeling that pressure was on the AeroSkirt product which is the side skirt that provides the fuel economy savings for the trucking industry. That specific product was being undercut by other products that have entered the market. And part of the initiative with the Frankfurt expansion facility is to be able to introduce a new suite of products. So that we will now be able to offer choices for customers that fit their needs. So you know a more entry-level products versus higher end products. They will have a full range of product offerings and that's what we are ramping at the moment. So that's why we believe that by the time we get through the next couple of quarters, we will be back in an area where we can compete effectively not only on getting the sales, but on getting them at an acceptable margin, by having a more broad selection of AeroSkirt type products to offer.

And then I guess the last question I had here was just on that 33-foot doubles regulation. I was wondering if you could just comment a little bit more on how you see that playing out with some of the mix considerations might be for you guys if the regulation is eventually passed?

Yeah obviously, we don't know precisely the timing. This thing has been an on-again off-again topic for the last year or two, but there’s certainly a lot of support from the LTLs, especially the big guys in wanting to get this thing through and included in the Highway Transportation Bill. So that they can get the instant 18% capacity increase per unit and it will reduce congestion on the highways and actually make things safer for travelers on the highway. So there’s a lot of good, a lot of things that make sense to get this thing in the bill and passed. The impact of a passage in the bill would be that, there would be an immediate demand for 33-foot equipment. Concurrent with that, there would be an immediate demand for conversions or stretching of current trailers if you will, extending some of the late model 28-foot pups to 33-foot pups. So that actually would benefit our business in both aspects, both on the new front and on the ability to take and do the conversions or the extensions of the trailers. The expectations is that there would be likely a three-year net favorable impact to overall demand for a van type products through 16, 17, 18 and maybe even all the way to 2019. A lot depends on the timing and implementation of when the law would actually go into effect.

Our next question is from John Mims. Please go ahead.

So let me, Dick the comment you made on product mix improved in the fourth quarter. But just when you look at the backlog and the bill plan that you have set so far for 2015, how is that shifting you know how much are we going to see a shift next year away from you know more of the stock trailers to a little bit higher priced product?

Well the pricing improvement is occurring, regardless of the type of products. So even on the more stock-type equipment versus the more higher spec equipment, pricing is improving year-over-year as we progress forward. And all of the open slots certainly are being most aggressively priced as we continue to fill out the year. There is no question in this strong environment, the percentage of the high-volume orders will dominate over the smaller orders because the big guys are still aggressively replacing the old equipment that they continue to have in their fleets. So that probably doesn't change a lot from a ratio standpoint, but you should expect year-over-year improvement in the pricing because we are really pushing that.

Sure, but when you look at a backlog like you have and I'm sure your competitors are seeing similar type of backlog numbers. Are you able to you know turn the screws on this high volume conversations? Because I know, like you know a few of the big orders that are you know recurring, are you going back to them and asking for rate increases or is there still a bit of a relationship you have to maintain there?

We're always going to have strategic relationships with customers that come into play in any negotiation. But clearly on a nameplate-by-nameplate basis, on a year-over-year basis prices are going up which means margins are going up, so that's the good part of it. As we progress through the year, the remaining open slots become much more selective as far as awarding those. And that's the beauty of the strong demand environment that we are all enjoying now is that we can all be much more selective and get the kind of pricing that we would like to see. That does not imply that you will see 5% and 10% price increases, but you are going to see price increases more aggressive than what we were able to get as an industry in the last 2 to 3 years?

And I want to just make sure we are clear on the progression of DPG margins and I appreciate the full-year guidance. And I think EPS guidance is extremely helpful, but just in terms of modeling and making sure we don't see any surprises near-term the start-up cost that you are talking about and the path that you need to take to get back to a third quarter margin number that's more reflective of historicals, does that imply that margins are going to be under pressure in the first two quarters? And then you will see a big ramp-up in the third or is the improvement that you saw sequentially in the fourth quarter, you know indicative of what we can see in the first and second quarter?

Certainly we would expect improvement going forward. However I want to remind everyone the first quarter is typically, traditionally and historically the weakest performance quarter for the business because of numerous factors. Lower shipment totals that we typically will have, it is always the lowest shipment total quarter for the year, year and year out. You also have the other headwinds related to higher operating cost related to utility cost, related to operating days. So the first quarter will always have the absorption headwind if you will and the higher utility cost headwind that plays into it. And then second and third quarters get significantly better and typically third quarter is the best quarter. The second quarter generally is strong and in some years, fourth-quarter is the surprising quarter. It's the one that is the least predictable and as we all know this past quarter with the favorable weather conditions and some might suggest the bonus depreciation played into that. That's a supposition. We hate to say because we don't know, customers don't tell us whether or not they are taking advantage of the bonus depreciation. But we clearly saw a significant number of trailer shipments occur in December and in the latter half. And very favorable weather conditions help support that, but quite possibly bonus depreciation played into that too.

Sure, sure but just to be clear and then I will pass it back. On the second quarter, the start-up cost that you have referenced a couple of times, would that you know tend to go against what you’d normally see as seasonal improvement from the first quarter to second quarter. And then you see all the catch up in the third quarter or should we see a normal seasonal uptick in the second quarter DPG margins?

John, I think the start-up costs that we are experiencing right now, you know as we continue to launch new products you know in the first quarter and the second quarter and then into the second half of next year probably stay at about the same level each quarter is where we see them today. So I don't expect to see a big change in the margin profile driven off of any kind of change in the start-up cost or ramp-up costs.

Yeah certainly we would expect to see margins better in the second quarter than the first and better than what you saw in the fourth.

Our next question is from Jeff Kauffman. Please go ahead.

Jeff, I wanted to talk a little bit about the cash and the balance sheet, maybe some of the resources you might need as we get over 60,000 units. You know you’ve announced a share repurchase, but you are sitting on a lot of cash and even with the higher CapEx you should be building a lot more cash. Can you talk about kind of what the plans are beyond the share repurchase, any kind of specific debt targets as you get into the year? And then maybe in terms of growth accommodation or some of the new growth initiatives you’ve out there, are there any uses for that capital that we may need to think about as we are modeling 15 and 16?

Jeff, that's a lot of questions there rolled up into one. You know obviously we finished the year with a very strong balance sheet. The cash position was around a $146 million and our net leverage was around 1.2. We feel very comfortable with our leverage position and the strength in the industry. And you know our financial position overall, so that's why we’ve the confidence to share repurchase. You know and that's something that's going to be a priority as we go through 2015 as you know we recognize that that is an activity where the investors want you to show them some progress. And so, you know we’ve announced a repurchase and you know we anticipate and expect that we will execute against that. At the same time you heard in Dick’s comments that we, you know we don't intend to stop deleveraging. The strong position we are in really gives us the flexibility to evaluate you know those activities in addition to continuing to strategically grow the business and we will do that through capital expenditures. We increased from 20 to 25 this year in terms of CapEx and we’ll continue that in the first half of the year. We typically you know invest in working capital. We expect that investment in the working capital to occur this year as well. Just a rough number, you know I expect working capital to use about $50 million, $40 million to $50 million in the first half of the year roughly. You know to give some guidance there, it could be a little more. It could be a little less, but that's where I am today. And then obviously you know we’ve always said, we want to reserve the right to continue to look at ways to grow the company strategically you know through acquisition if the right opportunity presents itself. We continue to be very selective, but strategic you know as we look into those types of activities. And obviously you know if those things occur, then we will let you know when they happen.

Okay and you mentioned on the CTP commentary that part of the ASP was mix and that you are seeing a growth in the platforms. As you are looking over 60,000 units, can you talk about how mix is moving around in terms of what your expectations are for CTP? But also DPG, because we noticed the engineering products revenues you know is still a little slower, but the tank trailer sales are up?

Yeah, I mean in terms of overall mix, we think 2015 is going to be pretty consistent with 2014. We’ve seen some growth on the platform or the flatbed side, we expect that strength to continue into 2015. On the DPG side Jeff, you know if you are seeing some fluctuation there in EP and liquid tank trailers. I mean it's effectively, you know those are lumpy businesses as we’ve talked in the past and you're going to get some quarterly fluctuation there?

And we have no further questions. I will turn it back over to you Dick and Jeff for any final remarks.

Thanks, John. Well so, while much has been done, opportunities abound. We will continue to be strategic, but selective in pursuing opportunities to grow our business in addition to the organic growth initiatives already under way. We will continue to be responsible stewards of the business to ensure that the proper balance between risk and reward is considered in all decisions. And in closing, we continue to be well positioned this year to deliver another year of record revenues and profitability with a strong and growing backlog, a demand environment that's solid and gaining momentum, and a number of new products nearing launch status. Thank you for your interest and support of Wabash National Corporation. Jeff and I look forward to speaking with all of you again on our next call. Thank you.

Thank you ladies and gentlemen. This concludes today's conference. Thank you for participating, you may now disconnect.