GREENEVILLE, Tenn.--(BUSINESS WIRE)--Forward Air Corporation (NASDAQ:FWRD) today reported operating revenue, income from operations, net income and diluted earnings per share for the three and nine months ended September 30, 2015.
Operating revenue for the quarter ended September 30, 2015 increased 22.6% to $247.1 million from $201.5 million for the same quarter in 2014. Income from operations was $24.6 million, compared to $26.9 million in the prior-year quarter. Net income during the period was $15.7 million compared to $16.7 million in the third quarter of 2014. Net income per diluted share for the third quarter of 2015 was $0.50 compared to $0.54 in the prior-year quarter.
There are approximately $3.9 million in Towne Air related integration costs included in our third quarter 2015 results. Excluding these costs, our adjusted income from operations would have been $28.5 million, compared with $26.7 million in the prior-year quarter, adjusted net income for the period would have been $18.1 million compared to $16.7 million in the prior year quarter and our adjusted income per diluted share would have been $0.58 compared to $0.54 a year ago. A reconciliation of these adjusted amounts to the most directly comparable GAAP amounts appears at the end of this press release. On an adjusted basis this is the highest quarterly adjusted income from operations, net income and income per diluted share in the Company’s history.
Operating revenue for the nine months ended September 30, 2015 increased 24.0% to $702.7 million from $566.9 million for the same period in 2014. Income from operations was $52.7 million, compared with $70.8 million in the prior-year period. As a percent of operating revenue, income from operations was 7.5%, compared with 12.5% in the same period last year. Net income during the period was $32.3 million compared to $44.1 million in the prior-year period. Income per diluted share for the nine months ended September 30, 2015 was $1.03 compared with $1.41 in the prior-year period.
There are approximately $22.9 million in Towne Air related deal and integration costs included in our results for the nine months ended September 30, 2015. Excluding these costs, our adjusted income from operations was $75.6 million compared with $71.5 million for the same period of 2014, adjusted net income for the period was $46.3 million compared to $44.7 million in 2014, and adjusted income per diluted share was $1.49 compared to $1.43 a year ago.
Bruce A. Campbell, Chairman, President, and CEO, commenting on the third quarter said, “We are happy to report that we exited the third quarter with the integration of Towne Air Freight substantially behind us. Our yield improvement initiatives implemented in September should drive increased profitability in the fourth quarter and throughout next year. These yield improvements should drive approximately $3.0 million in increased profitability in the fourth quarter of 2015 compared to the same period of 2014. Also, during September, we made additional headcount reductions, closed duplicate facilities, reduced dock labor costs and drove more efficient network routing which should produce approximately $1.5 million in additional cost savings in the fourth quarter of 2015 compared to the same period of 2014.”
Commenting further, Mr. Campbell said, “Central States Trucking Company (CST) is our first and final mile intermodal operation and its results are reported within our Forward Air, Inc. segment. Once again, CST delivered an outstanding quarter growing revenues 37%, posting an 87.5% operating ratio and increasing earnings 44%. Also, the CST team has started some very promising green-field operations in select targeted markets and is closing in on some additional tuck-in acquisition opportunities. We continue to be pleased with not only the CST team and their operating results but also CST as an accelerated growth platform.”
Commenting on the Forward Air Solutions (Solutions) operating segment Mr. Campbell said, “Going into peak season, Solutions typically doesn’t have the opportunity to take on new business. Yet, late in the third quarter, we were awarded $4 million of new business. Also, a large competitor went out of business. As a result, we have at least $5 million of additional business that started coming on board in the third quarter. Preparing for these new volumes was costly as well as time consuming and drove our lower than expected profitability in the third quarter. On a positive note, this new business should have substantial operating leverage for Solutions as it will be layered across our existing route structures.”
Commenting on our Total Quality, Inc. (TQI) segment Mr. Campbell said, “TQI’s struggles continued into the third quarter as our quarterly revenues declined approximately 15% year over year. Recognizing our lack of top line growth and the reasons for it, we identified and hired a new leader for this business, Steve Gilmore. Steve brings a wealth of life science, cold chain and transportation experience with him. We are committed to this business and to our customers and look forward to putting TQI back on a revenue growth trajectory.”
In closing Mr. Campbell said, “Especially given the Towne integration, 2015 has been a very challenging year. More than ever, I appreciate all the hard work on the part of our employees and independent contractors. We should finally realize the full benefit of all of that hard work in the fourth quarter. We fully expect to end 2015 on a high note and continue into 2016 driving the kind of enhanced shareholder value everyone has come to expect of Forward Air.”
Commenting further on the third quarter results was Rodney Bell, Senior Vice President and CFO, “After adding back Towne-related deal costs, we posted $0.58 for the quarter against a guidance midpoint of $0.60. Not included in our guidance was the benefit of approximately $0.03 that resulted from amending prior year tax returns for a technology-related permanent tax deduction. This deduction should result in an additional $3.0 million of tax benefit in the fourth quarter as we amend additional prior year returns. In 2016 and subsequent years, we expect the full year benefit of this credit to be approximately $1.0 million.”
Continuing, Mr. Bell said, “Backing out the $0.03 tax benefit, we posted a $0.05 shortfall to the midpoint of our guidance. Approximately $0.03 and $0.01 per share of that shortfall was due to the lower than expected profitability of Solutions and TQI, respectively. Additionally, we assumed that our Towne integration cost reduction and pricing initiatives would take place earlier in the quarter. Had they taken place as modeled, we would have earned approximately $0.02 per share more on the quarter. Also, the continued decline in the benefit of net fuel surcharges (FSC) was approximately an additional $0.01 drag than we modeled in our guidance. In order to simplify analysis of the quarterly results, we have included an actual to mid-point guidance earnings per share (EPS) bridge within this release.”
Closing with comments on the Company’s fourth quarter guidance Mr. Bell said, “We anticipate our fourth quarter 2015 revenues to increase in a range of 18% to 21% over the comparable 2014 period. Without regard to additional costs of integration, the above described technology tax deduction, or additional declines in our net fuel surcharge we expect income per diluted share to be between $0.62 and $0.66 per share. This compares to $0.55 per share in the fourth quarter of 2014.”
Review of Financial Results
Forward Air will hold a conference call to discuss third quarter 2015 results on Thursday, October 22, 2015 at 9:00 a.m. EDT. The Company's conference call will be available online at www.forwardair.com or by dialing (800) 230-1093. A replay of the conference call will be available at www.forwardair.com beginning shortly after the completion of the live call.
About Forward Air Corporation
Forward Air Corporation operates three business segments: Forward Air, Forward Air Solutions and Total Quality.
Through our Forward Air segment, we provide time-definite surface transportation and related logistics services to the North American expedited ground freight market. Our licensed property broker utilizes qualified motor carriers, including our own, and other third-party transportation companies, to offer our customers local pick-up and delivery (Forward Air Complete®) and scheduled surface transportation of cargo as a cost-effective, reliable alternative to air transportation. We transport cargo that must be delivered at a specific time but is less time-sensitive than traditional air freight. This type of cargo is frequently referred to in the transportation industry as deferred air freight. We also offer our customers an array of logistics and other services including: expedited full truckload (TLX); dedicated fleets; warehousing; customs brokerage; and shipment consolidation, deconsolidation and handling. Also included in the Forward Air segment are the services performed by Central States Trucking Co. and Central States Logistics, Inc. (“CST”), which we acquired in 2014. CST provides intermodal drayage, devanning, transloading and warehousing services.
Forward Air Solutions, which we formed in July 2007, provides pool distribution services throughout the Mid-Atlantic, Southeast, Midwest and Southwest continental United States. Pool distribution involves managing high-frequency, last mile handling and distribution of time-sensitive products to numerous destinations in specific geographic regions. Our primary customers for pool distribution are regional and nationwide distributors and specialty retailers, such as mall, strip mall and outlet-based retail chains.
Total Quality ("TQI"), which we acquired in March 2013, provides maximum security and temperature-controlled logistics services, primarily truckload services, to the life sciences sector (pharmaceutical and biotechnology products). In addition to core pharmaceutical services and other cold chain services, TQI provides truckload and less-than-truckload brokerage transportation services.
| Forward Air Corporation | ||||||||||||||||||||
| Consolidated Statements of Comprehensive Income | ||||||||||||||||||||
| (In thousands, except per share data) | ||||||||||||||||||||
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| Three months ended | Nine months ended | |||||||||||||||||||
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September 30, 2015 |
September 30, 2014 |
September 30, 2015 |
September 30, 2014 |
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| Operating revenue | $ | 247,093 | $ | 201,477 | $ | 702,705 | $ | 566,897 | ||||||||||||
| Operating expenses: | ||||||||||||||||||||
| Purchased transportation | 104,434 | 85,874 | 301,253 | 242,259 | ||||||||||||||||
| Salaries, wages and employee benefits | 59,025 | 45,651 | 174,815 | 131,464 | ||||||||||||||||
| Operating leases | 17,072 | 8,503 | 51,105 | 25,019 | ||||||||||||||||
| Depreciation and amortization | 9,399 | 8,115 | 27,601 | 22,879 | ||||||||||||||||
| Insurance and claims | 5,161 | 3,747 | 16,531 | 10,978 | ||||||||||||||||
| Fuel expense | 3,826 | 5,012 | 12,034 | 14,990 | ||||||||||||||||
| Other operating expenses | 23,575 | 17,669 | 66,608 | 48,537 | ||||||||||||||||
| Total operating expenses | 222,492 | 174,571 | 649,947 | 496,126 | ||||||||||||||||
| Income from operations | 24,601 | 26,906 | 52,758 | 70,771 | ||||||||||||||||
| Other income (expense): | ||||||||||||||||||||
| Interest expense | (554 | ) | (172 | ) | (1,489 | ) | (355 | ) | ||||||||||||
| Other, net | 10 | (55 | ) | (127 | ) | 144 | ||||||||||||||
| Total other income (expense) | (544 | ) | (227 | ) | (1,616 | ) | (211 | ) | ||||||||||||
| Income before income taxes | 24,057 | 26,679 | 51,142 | 70,560 | ||||||||||||||||
| Income taxes | 8,370 | 9,935 | 18,795 | 26,437 | ||||||||||||||||
| Net income and comprehensive income | $ | 15,687 | $ | 16,744 | $ | 32,347 | $ | 44,123 | ||||||||||||
| Net income per share: | ||||||||||||||||||||
| Basic | $ | 0.51 | $ | 0.55 | $ | 1.04 | $ | 1.44 | ||||||||||||
| Diluted | $ | 0.50 | $ | 0.54 | $ | 1.03 | $ | 1.41 | ||||||||||||
| Dividends per share: | $ | 0.12 | $ | 0.12 | $ | 0.36 | $ | 0.36 | ||||||||||||
| Forward Air Corporation | |||||||||||||||||||||||||||
| Components of Consolidated Revenue and Purchased Transportation | |||||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||
| Three months ended | |||||||||||||||||||||||||||
| September 30, | Percent of | September 30, | Percent of | Percent | |||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating Revenue | |||||||||||||||||||||||||||
| Forward Air | |||||||||||||||||||||||||||
| Airport-to-airport | $ | 133.7 | 64.8 | % | $ | 111.4 | 69.6 | % | $ | 22.3 | 20.0 | % | |||||||||||||||
| Logistics services | |||||||||||||||||||||||||||
| Expedited full truckload - TLX | 28.3 | 13.7 | 20.0 | 12.5 | 8.3 | 41.5 | |||||||||||||||||||||
| Intermodal/drayage | 22.9 | 11.1 | 15.8 | 9.9 | 7.1 | 44.9 | |||||||||||||||||||||
| Total Logistics services | 51.2 | 24.8 | 35.8 | 22.4 | 15.4 | 43.0 | |||||||||||||||||||||
| Other Forward Air services | 21.4 | 10.4 | 12.9 | 8.0 | 8.5 | 65.9 | |||||||||||||||||||||
| Forward Air - Total revenue | 206.3 | 83.5 | 160.1 | 79.4 | 46.2 | 28.9 | |||||||||||||||||||||
| TQI - Pharmaceutical services | 10.2 | 4.1 | 12.0 | 6.0 | (1.8 | ) | (15.0 | ) | |||||||||||||||||||
| Forward Air Solutions - Pool distribution | 32.1 | 13.0 | 30.6 | 15.2 | 1.5 | 4.9 | |||||||||||||||||||||
| Intersegment eliminations | (1.5 | ) | (0.6 | ) | (1.2 | ) | (0.6 | ) | (0.3 | ) | 25.0 | ||||||||||||||||
| Consolidated operating revenue | $ | 247.1 | 100.0 | % | $ | 201.5 | 100.0 | % | $ | 45.6 | 22.6 | % | |||||||||||||||
| Three months ended | |||||||||||||||||||||||||||
| September 30, | Percent of | September 30, | Percent of | Percent | |||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Purchased Transportation | |||||||||||||||||||||||||||
| Forward Air | |||||||||||||||||||||||||||
| Airport-to-airport | $ | 56.9 | 42.6 | % | $ | 47.7 | 42.8 | % | $ | 9.2 | 19.3 | % | |||||||||||||||
| Logistics services | |||||||||||||||||||||||||||
| Expedited full truckload - TLX | 20.7 | 73.1 | 15.0 | 75.0 | 5.7 | 38.0 | |||||||||||||||||||||
| Intermodal/drayage | 8.3 | 36.2 | 6.0 | 38.0 | 2.3 | 38.3 | |||||||||||||||||||||
| Total Logistics services | 29.0 | 56.6 | 21.0 | 58.7 | 8.0 | 38.1 | |||||||||||||||||||||
| Other Forward Air services | 6.1 | 28.5 | 3.2 | 24.8 | 2.9 | 90.6 | |||||||||||||||||||||
| Forward Air - Total purchased transportation | 92.0 | 44.6 | 71.9 | 44.9 | 20.1 | 28.0 | |||||||||||||||||||||
| TQI - Pharmaceutical services | 4.6 | 45.1 | 6.0 | 50.0 | (1.4 | ) | (23.3 | ) | |||||||||||||||||||
| Forward Air Solutions - Pool distribution | 8.8 | 27.4 | 8.8 | 28.8 | — | — | |||||||||||||||||||||
| Intersegment eliminations | (1.0 | ) | 66.7 | (0.8 | ) | 66.7 | (0.2 | ) | 25.0 | ||||||||||||||||||
| Consolidated purchased transportation | $ | 104.4 | 42.2 | % | $ | 85.9 | 42.6 | % | $ | 18.5 | 21.5 | % | |||||||||||||||
| Forward Air Corporation | |||||||||||||||||||||||||||
| Components of Consolidated Revenue and Purchased Transportation | |||||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||||||||
| Nine months ended | |||||||||||||||||||||||||||
| September 30, | Percent of | September 30, | Percent of | Percent | |||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating Revenue | |||||||||||||||||||||||||||
| Forward Air | |||||||||||||||||||||||||||
| Airport-to-airport | $ | 387.9 | 66.1 | % | $ | 317.1 | 70.7 | % | $ | 70.8 | 22.3 | % | |||||||||||||||
| Logistics services | |||||||||||||||||||||||||||
| Expedited full truckload - TLX | 79.1 | 13.5 | 56.6 | 12.6 | 22.5 | 39.8 | |||||||||||||||||||||
| Intermodal/drayage | 62.6 | 10.7 | 39.1 | 8.7 | 23.5 | 60.1 | |||||||||||||||||||||
| Total Logistics services | 141.7 | 24.2 | 95.7 | 21.3 | 46.0 | 48.1 | |||||||||||||||||||||
| Other Forward Air services | 56.8 | 9.7 | 35.7 | 8.0 | 21.1 | 59.1 | |||||||||||||||||||||
| Forward Air - Total revenue | 586.4 | 83.5 | 448.5 | 79.1 | 137.9 | 30.7 | |||||||||||||||||||||
| TQI - Pharmaceutical services | 33.3 | 4.7 | 36.8 | 6.5 | (3.5 | ) | (9.5 | ) | |||||||||||||||||||
| Forward Air Solutions - Pool distribution | 87.0 | 12.4 | 84.9 | 15.0 | 2.1 | 2.5 | |||||||||||||||||||||
| Intersegment eliminations | (4.0 | ) | (0.6 | ) | (3.3 | ) | (0.6 | ) | (0.7 | ) | 21.2 | ||||||||||||||||
| Consolidated operating revenue | $ | 702.7 | 100.0 | % | $ | 566.9 | 100.0 | % | $ | 135.8 | 24.0 | % | |||||||||||||||
| Nine months ended | |||||||||||||||||||||||||||
| September 30, | Percent of | September 30, | Percent of | Percent | |||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Purchased Transportation | |||||||||||||||||||||||||||
| Forward Air | |||||||||||||||||||||||||||
| Airport-to-airport | $ | 168.1 | 43.3 | % | $ | 133.2 | 42.0 | % | $ | 34.9 | 26.2 | % | |||||||||||||||
| Logistics services | |||||||||||||||||||||||||||
| Expedited full truckload - TLX | 57.2 | 72.3 | 43.4 | 76.7 | 13.8 | 31.8 | |||||||||||||||||||||
| Intermodal/drayage | 23.0 | 36.7 | 15.9 | 40.7 | 7.1 | 44.7 | |||||||||||||||||||||
| Total Logistics services | 80.2 | 56.6 | 59.3 | 62.0 | 20.9 | 35.2 | |||||||||||||||||||||
| Other Forward Air services | 16.3 | 28.7 | 8.8 | 24.6 | 7.5 | 85.2 | |||||||||||||||||||||
| Forward Air - Total purchased transportation | 264.6 | 45.1 | 201.3 | 44.9 | 63.3 | 31.4 | |||||||||||||||||||||
| TQI - Pharmaceutical services | 15.7 | 47.1 | 18.7 | 50.8 | (3.0 | ) | (16.0 | ) | |||||||||||||||||||
| Forward Air Solutions - Pool distribution | 23.8 | 27.4 | 24.6 | 29.0 | (0.8 | ) | (3.3 | ) | |||||||||||||||||||
| Intersegment eliminations | (2.8 | ) | 70.0 | (2.4 | ) | 72.7 | (0.4 | ) | 16.7 | ||||||||||||||||||
| Consolidated purchased transportation | $ | 301.3 | 42.9 | % | $ | 242.2 | 42.7 | % | $ | 59.1 | 24.4 | % | |||||||||||||||
| Forward Air Corporation | |||||||||
| Consolidated Balance Sheets | |||||||||
| (In thousands) | |||||||||
| (Unaudited) | |||||||||
|
September 30, 2015 |
December 31, |
||||||||
| Assets | |||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 47,444 | $ | 41,429 | |||||
| Accounts receivable, net | 114,674 | 95,326 | |||||||
| Other current assets | 23,579 | 13,200 | |||||||
| Total current assets | 185,697 | 149,955 | |||||||
| Property and equipment | 322,681 | 305,188 | |||||||
| Less accumulated depreciation and amortization | 150,180 | 132,699 | |||||||
| Net property and equipment | 172,501 | 172,489 | |||||||
| Goodwill and other acquired intangibles: | |||||||||
| Goodwill | 206,899 | 144,412 | |||||||
| Other acquired intangibles, net of accumulated amortization | 130,531 | 72,705 | |||||||
| Total net goodwill and other acquired intangibles | 337,430 | 217,117 | |||||||
| Other assets | 3,037 | 2,244 | |||||||
| Total assets | $ | 698,665 | $ | 541,805 | |||||
| Liabilities and Shareholders’ Equity | |||||||||
| Current liabilities: | |||||||||
| Accounts payable | $ | 27,435 | $ | 20,572 | |||||
| Accrued expenses | 29,691 | 22,583 | |||||||
| Current portion of debt and capital lease obligations | 55,898 | 276 | |||||||
| Total current liabilities | 113,024 | 43,431 | |||||||
| Debt and capital lease obligations, less current portion | 42,830 | 1,275 | |||||||
| Other long-term liabilities | 12,198 | 8,356 | |||||||
| Deferred income taxes | 38,257 | 25,180 | |||||||
| Shareholders’ equity: | |||||||||
| Common stock | 306 | 303 | |||||||
| Additional paid-in capital | 152,700 | 130,107 | |||||||
| Retained earnings | 339,350 | 333,153 | |||||||
| Total shareholders’ equity | 492,356 | 463,563 | |||||||
| Total liabilities and shareholders’ equity | $ | 698,665 | $ | 541,805 | |||||
| (a) Taken from audited financial statements, which are not presented in their entirety. | |||||||||
| Forward Air Corporation | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| (In thousands) | ||||||||||
| (Unaudited) | ||||||||||
| Three months ended | ||||||||||
|
September 30, 2015 |
September 30, |
|||||||||
| Operating activities: | ||||||||||
| Net income | $ | 15,687 | $ | 16,744 | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities | ||||||||||
| Depreciation and amortization | 9,399 | 8,115 | ||||||||
| Share-based compensation | 1,886 | 1,676 | ||||||||
| Loss (gain) on disposal of property and equipment | 30 | (329 | ) | |||||||
| Provision for loss on receivables | 380 | 46 | ||||||||
| Provision for revenue adjustments | 1,549 | 646 | ||||||||
| Deferred income tax | 6,044 | 156 | ||||||||
| Excess tax benefit for stock options exercised | — | 353 | ||||||||
| Changes in operating assets and liabilities | ||||||||||
| Accounts receivable | 5,753 | (3,148 | ) | |||||||
| Prepaid expenses and other current assets | 1,679 | 1,032 | ||||||||
| Accounts payable and accrued expenses | (3,654 | ) | 587 | |||||||
| Net cash provided by operating activities | 38,753 | 25,878 | ||||||||
| Investing activities: | ||||||||||
| Proceeds from disposal of property and equipment | 577 | 1,120 | ||||||||
| Purchases of property and equipment | (6,579 | ) | (3,681 | ) | ||||||
| Acquisition of business, net of cash acquired | — | (1,350 | ) | |||||||
| Other | (33 | ) | 246 | |||||||
| Net cash used in investing activities | (6,035 | ) | (3,665 | ) | ||||||
| Financing activities: | ||||||||||
| Payments of debt and capital lease obligations | (14,104 | ) | (84 | ) | ||||||
| Proceeds from exercise of stock options | — | 1,503 | ||||||||
| Payments of cash dividends | (3,700 | ) | (3,662 | ) | ||||||
| Repurchase of common stock (repurchase program) | (9,996 | ) | (19,987 | ) | ||||||
| Cash settlement of share-based awards for minimum tax withholdings | (5 | ) | — | |||||||
| Excess tax benefit for stock options exercised | — | (353 | ) | |||||||
| Net cash used in financing activities | (27,805 | ) | (22,583 | ) | ||||||
| Net increase (decrease) in cash | 4,913 | (370 | ) | |||||||
| Cash at beginning of period | 42,531 | 24,943 | ||||||||
| Cash at end of period | $ | 47,444 | $ | 24,573 | ||||||
| Forward Air Corporation | ||||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||
| (In thousands) | ||||||||||
| (Unaudited) | ||||||||||
| Nine months ended | ||||||||||
|
September 30, 2015 |
September 30, 2014 |
|||||||||
| Operating activities: | ||||||||||
| Net income | $ | 32,347 | $ | 44,123 | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities | ||||||||||
| Depreciation and amortization | 27,601 | 22,879 | ||||||||
| Share-based compensation | 5,562 | 5,005 | ||||||||
| Gain on disposal of property and equipment | (3 | ) | (441 | ) | ||||||
| Provision for loss (recovery) on receivables | 463 | (39 | ) | |||||||
| Provision for revenue adjustments | 3,391 | 1,896 | ||||||||
| Deferred income tax | 5,546 | 1,729 | ||||||||
| Excess tax benefit for stock options exercised | (2,365 | ) | (554 | ) | ||||||
| Changes in operating assets and liabilities | ||||||||||
| Accounts receivable | 866 | (15,875 | ) | |||||||
| Prepaid expenses and other current assets | (1,531 | ) | (1,397 | ) | ||||||
| Accounts payable and accrued expenses | (14,562 | ) | 7,767 | |||||||
| Net cash provided by operating activities | 57,315 | 65,093 | ||||||||
| Investing activities: | ||||||||||
| Proceeds from disposal of property and equipment | 1,200 | 1,582 | ||||||||
| Purchases of property and equipment | (18,541 | ) | (37,101 | ) | ||||||
| Acquisition of business, net of cash acquired | (62,375 | ) | (84,348 | ) | ||||||
| Other | (101 | ) | 53 | |||||||
| Net cash used in investing activities | (79,817 | ) | (119,814 | ) | ||||||
| Financing activities: | ||||||||||
| Proceeds from term loan | 125,000 | — | ||||||||
| Payments of debt and capital lease obligations | (87,367 | ) | (9,662 | ) | ||||||
| Proceeds from exercise of stock options | 11,351 | 13,083 | ||||||||
| Payments of cash dividends | (11,133 | ) | (11,141 | ) | ||||||
| Repurchase of common stock (repurchase program) | (9,996 | ) | (39,972 | ) | ||||||
| Common stock issued under employee stock purchase plan | 228 | 148 | ||||||||
| Cash settlement of share-based awards for minimum tax withholdings | (1,931 | ) | (1,083 | ) | ||||||
| Excess tax benefit for stock options exercised | 2,365 | 554 | ||||||||
| Net cash provided by (used in) financing activities | 28,517 | (48,073 | ) | |||||||
| Net increase (decrease) in cash | 6,015 | (102,794 | ) | |||||||
| Cash at beginning of period | 41,429 | 127,367 | ||||||||
| Cash at end of period | $ | 47,444 | $ | 24,573 | ||||||
|
Forward Air Corporation Segment Information (In millions) (unaudited) |
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| Three months ended | |||||||||||||||||||||||||||
| Forward Air | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 206.3 | 83.5 | % | $ | 160.1 | 79.4 | % | $ | 46.2 | 28.9 | % | |||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 92.0 | 44.6 | 71.9 | 44.9 | 20.1 | 28.0 | |||||||||||||||||||||
| Salaries, wages, and employee benefits | 44.5 | 21.6 | 33.1 | 20.7 | 11.4 | 34.4 | |||||||||||||||||||||
| Operating leases | 14.5 | 7.0 | 6.5 | 4.1 | 8.0 | 123.1 | |||||||||||||||||||||
| Depreciation and amortization | 6.9 | 3.4 | 5.7 | 3.6 | 1.2 | 21.1 | |||||||||||||||||||||
| Insurance and claims | 4.0 | 1.9 | 3.1 | 1.9 | 0.9 | 29.0 | |||||||||||||||||||||
| Fuel expense | 1.7 | 0.8 | 2.1 | 1.3 | (0.4 | ) | (19.0 | ) | |||||||||||||||||||
| Other operating expenses | 19.0 | 9.2 | 13.5 | 8.4 | 5.5 | 40.7 | |||||||||||||||||||||
| Income from operations | $ | 23.7 | 11.5 | % | $ | 24.2 | 15.1 | % | $ | (0.5 | ) | (2.1 | )% | ||||||||||||||
| FASI | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 32.1 | 13.0 | % | $ | 30.6 | 15.2 | % | $ | 1.5 | 4.9 | % | |||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 8.8 | 27.4 | 8.8 | 28.8 | — | — | |||||||||||||||||||||
| Salaries, wages, and employee benefits | 12.2 | 38.0 | 10.4 | 34.0 | 1.8 | 17.3 | |||||||||||||||||||||
| Operating leases | 2.5 | 7.8 | 2.0 | 6.5 | 0.5 | 25.0 | |||||||||||||||||||||
| Depreciation and amortization | 1.5 | 4.7 | 1.5 | 4.9 | — | — | |||||||||||||||||||||
| Insurance and claims | 0.9 | 2.8 | 0.4 | 1.3 | 0.5 | 125.0 | |||||||||||||||||||||
| Fuel expense | 1.3 | 4.0 | 1.8 | 5.9 | (0.5 | ) | (27.8 | ) | |||||||||||||||||||
| Other operating expenses | 4.4 | 13.7 | 3.9 | 12.7 | 0.5 | 12.8 | |||||||||||||||||||||
| Income from operations | $ | 0.5 | 1.6 | % | $ | 1.8 | 5.9 | % | $ | (1.3 | ) | (72.2 | )% | ||||||||||||||
| TQI | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 10.2 | 4.1 | % | $ | 12.0 | 6.0 | % | $ | (1.8 | ) | (15.0 | )% | ||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 4.6 | 45.1 | 6.0 | 50.0 | (1.4 | ) | (23.3 | ) | |||||||||||||||||||
| Salaries, wages, and employee benefits | 2.4 | 23.5 | 2.2 | 18.3 | 0.2 | 9.1 | |||||||||||||||||||||
| Operating leases | — | — | — | — | — | — | |||||||||||||||||||||
| Depreciation and amortization | 1.0 | 9.8 | 0.9 | 7.5 | 0.1 | 11.1 | |||||||||||||||||||||
| Insurance and claims | 0.3 | 2.9 | 0.2 | 1.7 | 0.1 | 50.0 | |||||||||||||||||||||
| Fuel expense | 0.8 | 7.9 | 1.1 | 9.2 | (0.3 | ) | (27.3 | ) | |||||||||||||||||||
| Other operating expenses | 0.7 | 6.9 | 0.7 | 5.8 | — | — | |||||||||||||||||||||
| Income from operations | $ | 0.4 | 3.9 | % | $ | 0.9 | 7.5 | % | $ | (0.5 | ) | (55.6 | )% | ||||||||||||||
| Intercompany Eliminations | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | (1.5 | ) | (0.6 | )% | $ | (1.2 | ) | (0.6 | )% | $ | (0.3 | ) | 25.0 | % | ||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | (1.0 | ) | 66.7 | (0.8 | ) | 66.7 | (0.2 | ) | 25.0 | ||||||||||||||||||
| Other operating expenses | (0.5 | ) | 33.3 | (0.4 | ) | 33.3 | (0.1 | ) | 25.0 | ||||||||||||||||||
| Income from operations | $ | — | — | % | $ | — | — | % | $ | — | — | % | |||||||||||||||
| Consolidated | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 247.1 | 100.0 | % | $ | 201.5 | 100.0 | % | $ | 45.6 | 22.6 | % | |||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 104.4 | 42.2 | 85.9 | 42.6 | 18.5 | 21.5 | |||||||||||||||||||||
| Salaries, wages, and employee benefits | 59.1 | 23.9 | 45.7 | 22.7 | 13.4 | 29.3 | |||||||||||||||||||||
| Operating leases | 17.0 | 6.9 | 8.5 | 4.2 | 8.5 | 100.0 | |||||||||||||||||||||
| Depreciation and amortization | 9.4 | 3.8 | 8.1 | 4.0 | 1.3 | 16.0 | |||||||||||||||||||||
| Insurance and claims | 5.2 | 2.1 | 3.7 | 1.9 | 1.5 | 40.5 | |||||||||||||||||||||
| Fuel expense | 3.8 | 1.5 | 5.0 | 2.5 | (1.2 | ) | (24.0 | ) | |||||||||||||||||||
| Other operating expenses | 23.6 | 9.6 | 17.7 | 8.8 | 5.9 | 33.3 | |||||||||||||||||||||
| Income from operations | $ | 24.6 | 10.0 | % | $ | 26.9 | 13.3 | % | $ | (2.3 | ) | (8.6 | )% | ||||||||||||||
|
Forward Air Corporation Segment Information (In millions) (unaudited) |
|||||||||||||||||||||||||||
| Nine months ended | |||||||||||||||||||||||||||
| Forward Air | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 586.4 | 83.5 | % | $ | 448.5 | 79.1 | % | $ | 137.9 | 30.7 | % | |||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 264.6 | 45.1 | 201.3 | 44.9 | 63.3 | 31.4 | |||||||||||||||||||||
| Salaries, wages, and employee benefits | 134.8 | 23.0 | 96.1 | 21.4 | 38.7 | 40.3 | |||||||||||||||||||||
| Operating leases | 44.3 | 7.5 | 18.4 | 4.1 | 25.9 | 140.8 | |||||||||||||||||||||
| Depreciation and amortization | 20.1 | 3.4 | 16.0 | 3.6 | 4.1 | 25.6 | |||||||||||||||||||||
| Insurance and claims | 13.1 | 2.2 | 8.7 | 1.9 | 4.4 | 50.6 | |||||||||||||||||||||
| Fuel expense | 5.6 | 1.0 | 6.2 | 1.4 | (0.6 | ) | (9.7 | ) | |||||||||||||||||||
| Other operating expenses | 54.3 | 9.3 | 37.0 | 8.3 | 17.3 | 46.8 | |||||||||||||||||||||
| Income from operations | $ | 49.6 | 8.5 | % | $ | 64.8 | 14.4 | % | $ | (15.2 | ) | (23.5 | )% | ||||||||||||||
| FASI | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 87.0 | 12.4 | % | $ | 84.9 | 15.0 | % | $ | 2.1 | 2.5 | % | |||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 23.8 | 27.4 | 24.6 | 29.0 | (0.8 | ) | (3.3 | ) | |||||||||||||||||||
| Salaries, wages, and employee benefits | 32.8 | 37.7 | 29.0 | 34.2 | 3.8 | 13.1 | |||||||||||||||||||||
| Operating leases | 6.8 | 7.8 | 6.5 | 7.7 | 0.3 | 4.6 | |||||||||||||||||||||
| Depreciation and amortization | 4.6 | 5.3 | 4.2 | 4.9 | 0.4 | 9.5 | |||||||||||||||||||||
| Insurance and claims | 2.7 | 3.1 | 1.8 | 2.1 | 0.9 | 50.0 | |||||||||||||||||||||
| Fuel expense | 3.9 | 4.5 | 5.3 | 6.2 | (1.4 | ) | (26.4 | ) | |||||||||||||||||||
| Other operating expenses | 11.6 | 13.3 | 10.7 | 12.6 | 0.9 | 8.4 | |||||||||||||||||||||
| Income from operations | $ | 0.8 | 0.9 | % | $ | 2.8 | 3.3 | % | $ | (2.0 | ) | (71.4 | )% | ||||||||||||||
| TQI | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 33.3 | 4.7 | % | $ | 36.8 | 6.5 | % | $ | (3.5 | ) | (9.5 | )% | ||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 15.7 | 47.2 | 18.7 | 50.8 | (3.0 | ) | (16.0 | ) | |||||||||||||||||||
| Salaries, wages, and employee benefits | 7.2 | 21.6 | 6.4 | 17.4 | 0.8 | 12.5 | |||||||||||||||||||||
| Operating leases | 0.1 | 0.3 | 0.1 | 0.3 | — | — | |||||||||||||||||||||
| Depreciation and amortization | 2.9 | 8.7 | 2.7 | 7.3 | 0.2 | 7.4 | |||||||||||||||||||||
| Insurance and claims | 0.7 | 2.1 | 0.5 | 1.4 | 0.2 | 40.0 | |||||||||||||||||||||
| Fuel expense | 2.6 | 7.8 | 3.5 | 9.5 | (0.9 | ) | (25.7 | ) | |||||||||||||||||||
| Other operating expenses | 1.8 | 5.4 | 1.7 | 4.6 | 0.1 | 5.9 | |||||||||||||||||||||
| Income from operations | $ | 2.3 | 6.9 | % | $ | 3.2 | 8.7 | % | $ | (0.9 | ) | (28.1 | )% | ||||||||||||||
| Intercompany Eliminations | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | (4.0 | ) | (0.6 | )% | $ | (3.3 | ) | (0.6 | )% | $ | (0.7 | ) | 21.2 | % | ||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | (2.8 | ) | 70.0 | (2.4 | ) | 72.7 | (0.4 | ) | 16.7 | ||||||||||||||||||
| Other operating expenses | (1.2 | ) | 30.0 | (0.9 | ) | 27.3 | (0.3 | ) | 33.3 | ||||||||||||||||||
| Income from operations | $ | — | — | % | $ | — | — | % | $ | — | — | % | |||||||||||||||
| Consolidated | September 30, | Percent of | September 30, | Percent of | Percent | ||||||||||||||||||||||
| 2015 | Revenue | 2014 | Revenue | Change | Change | ||||||||||||||||||||||
| Operating revenue | $ | 702.7 | 100.0 | % | $ | 566.9 | 100.0 | % | $ | 135.8 | 24.0 | % | |||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||
| Purchased transportation | 301.3 | 42.9 | 242.2 | 42.7 | 59.1 | 24.4 | |||||||||||||||||||||
| Salaries, wages, and employee benefits | 174.8 | 24.9 | 131.5 | 23.2 | 43.3 | 32.9 | |||||||||||||||||||||
| Operating leases | 51.2 | 7.3 | 25.0 | 4.4 | 26.2 | 104.8 | |||||||||||||||||||||
| Depreciation and amortization | 27.6 | 3.9 | 22.9 | 4.0 | 4.7 | 20.5 | |||||||||||||||||||||
| Insurance and claims | 16.5 | 2.3 | 11.0 | 2.0 | 5.5 | 50.0 | |||||||||||||||||||||
| Fuel expense | 12.1 | 1.7 | 15.0 | 2.6 | (2.9 | ) | (19.3 | ) | |||||||||||||||||||
| Other operating expenses | 66.5 | 9.5 | 48.5 | 8.6 | 18.0 | 37.1 | |||||||||||||||||||||
| Income from operations | $ | 52.7 | 7.5 | % | $ | 70.8 | 12.5 | % | $ | (18.1 | ) | (25.6 | )% | ||||||||||||||
| Forward Air Corporation | ||||||||||||||
| Forward Air Inc. Operating Statistics | ||||||||||||||
| Three months ended | ||||||||||||||
| September 30, | September 30, | Percent | ||||||||||||
| 2015 | 2014 | Change | ||||||||||||
| Operating ratio | 88.5 | % | 84.9 | % | 4.2 | % | ||||||||
| Business days | 64.0 | 64.0 | — | |||||||||||
| Business weeks | 12.8 | 12.8 | — | |||||||||||
| Airport-to-airport: | ||||||||||||||
| Tonnage | ||||||||||||||
| Total pounds ¹ | 617,066 | 484,827 | 27.3 | |||||||||||
| Average weekly pounds ¹ | 48,208 | 37,877 | 27.3 | |||||||||||
| Linehaul shipments | ||||||||||||||
| Total linehaul | 920,493 | 734,163 | 25.4 | |||||||||||
| Average weekly | 71,914 | 57,356 | 25.4 | |||||||||||
| Forward Air Complete shipments | 223,143 | 146,024 | 52.8 | |||||||||||
| As a percentage of linehaul shipments | 24.2 | % | 19.9 | % | 21.6 | |||||||||
| Average linehaul shipment size | 670 | 660 | 1.5 | |||||||||||
| Revenue per pound ² | ||||||||||||||
| Linehaul yield | $ | 17.07 | $ | 17.69 | (2.7 | ) | ||||||||
| Fuel surcharge impact | 1.16 | 1.94 | (3.4 | ) | ||||||||||
| Forward Air Complete impact | 3.44 | 3.35 | 0.4 | |||||||||||
| Total airport-to-airport yield | $ | 21.67 | $ | 22.98 | (5.7 | ) | ||||||||
| Expedited full truckload - TLX: | ||||||||||||||
| Miles | ||||||||||||||
| Owner operator ¹ | 9,933 | 6,391 | 55.4 | |||||||||||
| Third party ¹ | 5,822 | 4,895 | 18.9 | |||||||||||
| Total Miles | 15,755 | 11,286 | 39.6 | |||||||||||
| Revenue per mile | $ | 1.80 | $ | 1.77 | 1.7 | |||||||||
| Cost per mile | $ | 1.31 | $ | 1.33 | (1.5 | )% | ||||||||
| ¹ - In thousands | ||||||||||||||
|
² - In dollars per hundred pound; percentage change is expressed as a percent of total yield. |
||||||||||||||
| Forward Air Corporation | ||||||||||||||
| Forward Air Inc. Operating Statistics | ||||||||||||||
| Nine months ended | ||||||||||||||
| September 30, | September 30, | Percent | ||||||||||||
| 2015 | 2014 | Change | ||||||||||||
| Operating ratio | 91.5 | % | 85.6 | % | 6.9 | % | ||||||||
| Business days | 191.0 | 191.0 | — | |||||||||||
| Business weeks | 38.2 | 38.2 | — | |||||||||||
| Airport-to-airport: | ||||||||||||||
| Tonnage | ||||||||||||||
| Total pounds ¹ | 1,787,262 | 1,399,687 | 27.7 | |||||||||||
| Average weekly pounds ¹ | 46,787 | 36,641 | 27.7 | |||||||||||
| Linehaul shipments | ||||||||||||||
| Total linehaul | 2,717,100 | 2,127,645 | 27.7 | |||||||||||
| Average weekly | 71,128 | 55,698 | 27.7 | |||||||||||
| Forward Air Complete shipments | 649,431 | 393,170 | 65.2 | |||||||||||
| As a percentage of linehaul shipments | 23.9 | % | 18.5 | % | 29.2 | |||||||||
| Average linehaul shipment size | 658 | 658 | — | |||||||||||
| Revenue per pound ² | ||||||||||||||
| Linehaul yield | $ | 17.28 | $ | 17.56 | (1.2 | ) | ||||||||
| Fuel surcharge impact | 1.20 | 2.00 | (3.5 | ) | ||||||||||
| Forward Air Complete impact | 3.22 | 3.10 | 0.5 | |||||||||||
| Total airport-to-airport yield | $ | 21.70 | $ | 22.66 | (4.2 | ) | ||||||||
| Expedited full truckload - TLX: | ||||||||||||||
| Miles | ||||||||||||||
| Owner operator ¹ | 24,011 | 20,288 | 18.4 | |||||||||||
| Third party ¹ | 18,128 | 13,547 | 33.8 | |||||||||||
| Total Miles | 42,139 | 33,835 | 24.5 | |||||||||||
| Revenue per mile | $ | 1.88 | $ | 1.67 | 12.6 | |||||||||
| Cost per mile | $ | 1.36 | $ | 1.28 | 6.3 | % | ||||||||
| ¹ - In thousands | ||||||||||||||
| ² - In dollars per hundred pound; percentage change is expressed as a percent of total yield. | ||||||||||||||
Forward Air Corporation Reconciliation to U.S. GAAP
The Company believes that meaningful analysis of our financial performance requires an understanding of the factors underlying that performance, including an understanding of items that are non-recurring in nature. We believe that excluding integration costs related to Towne Air from our results for the three and nine months ended September 30, 2015 will assist investors in understanding our core operating performance and allow for more accurate comparisons of results. As required by SEC rules, the tables below present, for the periods indicated, a reconciliation of our presented adjusted non-GAAP measures to the most directly comparable GAAP measures.
| (In millions, except per share data) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Three months ended | ||||||||||||||
| Adjusted | ||||||||||||||
|
September 30, |
Integration and Deal Costs |
September 30, |
||||||||||||
| Income from operations | $ | 24.6 | $ | 3.9 | $ | 28.5 | ||||||||
| Net income | $ | 15.7 | $ | 2.4 | $ | 18.1 | ||||||||
| Weighted average diluted shares outstanding | 30,998 | 30,998 | 30,998 | |||||||||||
| Net income per share: | $ | 0.50 | $ | 0.08 | $ | 0.58 | ||||||||
| (1) - As reported in accordance with United States generally accepted accounting principles. | ||||||||||||||
| Three months ended | ||||||||||||||
| Adjusted | ||||||||||||||
|
September 30, |
Integration and Deal Costs |
September 30, |
||||||||||||
| Income from operations | $ | 26.7 | $ | — | $ | 26.7 | ||||||||
| Net income | $ | 16.7 | $ | — | $ | 16.7 | ||||||||
| Weighted average diluted shares outstanding | 30,932 | — | 30,932 | |||||||||||
| Net income per share: | $ | 0.54 | $ | — | $ | 0.54 | ||||||||
| (1) - As reported in accordance with United States generally accepted accounting principles. | ||||||||||||||
| Forward Air Corporation | ||||||||||||||
| Reconciliation to U.S. GAAP | ||||||||||||||
| (In millions, except per share data) | ||||||||||||||
| (Unaudited) | ||||||||||||||
| Nine months ended | ||||||||||||||
| Adjusted | ||||||||||||||
|
September 30, |
Integration and Deal Costs |
September 30, |
||||||||||||
| Income from operations | $ | 52.7 | $ | 22.9 | $ | 75.6 | ||||||||
| Net income | $ | 32.3 | $ | 14.0 | $ | 46.3 | ||||||||
| Weighted average diluted shares outstanding | 31,084 | 31,084 | 31,084 | |||||||||||
| Net income per share: | $ | 1.03 | $ | 0.45 | $ | 1.49 | ||||||||
| (1) - As reported in accordance with United States generally accepted accounting principles. | ||||||||||||||
| Nine months ended | ||||||||||||||
| Adjusted | ||||||||||||||
|
September 30, |
Integration and Deal Costs |
September 30, |
||||||||||||
| Income from operations | $ | 70.6 | $ | 0.9 | $ | 71.5 | ||||||||
| Net income | $ | 44.1 | $ | 0.6 | $ | 44.7 | ||||||||
| Weighted average diluted shares outstanding | 31,234 | 31,234 | 31,234 | |||||||||||
| Net income per share: | $ | 1.41 | $ | 0.02 | $ | 1.43 | ||||||||
| (1) - As reported in accordance with United States generally accepted accounting principles. | ||||||||||||||
| Forward Air Corporation | ||||||||
| Actual to Guidance EPS Bridge | ||||||||
| Three months ended September 30, 2015 | ||||||||
| (All EPS is diluted earnings per share) | ||||||||
| Third quarter EPS as reported | $ | 0.500 | ||||||
| Towne Air acquisition and integration costs | 0.080 | |||||||
| Adjusted EPS | 0.580 | |||||||
| Variances from guidance assumptions: | ||||||||
| Technology tax deduction | (0.030 | ) | ||||||
| FASI EPS contribution shortfall | 0.025 | |||||||
| TQI EPS contribution shortfall | 0.010 | |||||||
| Timing of cost reductions and pricing adjustments related to Towne | 0.015 | |||||||
| Detrimental difference in net fuel surcharge | 0.010 | |||||||
| Total variances from guidance assumptions | 0.030 | |||||||
| Adjusted EPS with variances added back | 0.610 | |||||||
| Mid-point of original third quarter guidance | 0.600 | |||||||
| Remaining positive EPS variance | $ | 0.010 | ||||||
Important Information
This press release may contain statements that might be considered as forward-looking statements or predictions of future operations. Such statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are based on management’s belief or interpretation of information currently available. These statements and assumptions involve certain risks and uncertainties. Actual events may differ from these expectations as specified from time to time in filings with the Securities and Exchange Commission. We assume no duty to update these statements as of any future date.
This press release contains “forward-looking statements,” as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are statements other than historical information or statements of current condition and relate to future events or our future financial performance, including, without limitation, statements as to Towne or the anticipated benefits of the transaction. Some forward-looking statements may be identified by use of such terms as “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects” or “expects.” Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The following is a list of factors, among others, that could cause actual results to differ materially from those contemplated by the forward-looking statements: economic factors such as recessions, inflation, higher interest rates and downturns in customer business cycles, our inability to maintain our historical growth rate because of a decreased volume of freight moving through our network or decreased average revenue per pound of freight moving through our network, increasing competition and pricing pressure, surplus inventories, loss of a major customer, the creditworthiness of our customers and their ability to pay for services rendered, our ability to secure terminal facilities in desirable locations at reasonable rates, the inability of our information systems to handle an increased volume of freight moving through our network, changes in fuel prices, claims for property damage, personal injuries or workers' compensation, employment matters including rising health care costs, enforcement of and changes in governmental regulations, environmental and tax matters, the handling of hazardous materials, the availability and compensation of qualified independent owner-operators and freight handlers needed to serve our transportation needs and our inability to successfully integrate Towne. As a result of the foregoing, no assurance can be given as to future financial condition, cash flows or results of operations. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
