FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark one)FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30,December 31, 2012
or
[ ]OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ________________
Commission File Numberfile number: 33-26115
PATRIOT TRANSPORTATION HOLDING, INC.
(Exact name of registrant as specified in its charter)
FloridaFLORIDA 59-2924957
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
200 W. Forsyth St.FORSYTH ST., 7th Floor, Jacksonville,7TH FLOOR, JACKSONVILLE, FL 32202
(Address of principal executive offices)(Zip (Zip Code)
904-396-5733
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No___[ x ] No [ ]
Indicate by check mark whether the registrant has submitted electronically
and posted on its corporate Web site, if any, every Interactive Data File
required to be submitted and posted pursuant to Rule 405 of Regulation S-T
(Section 232.405(ss.232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required
to submit and post such files).
Yes[X] No[Yes [ x ] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, a non-accelerated filer, or a non-accelerated
filer.smaller reporting company.
See definitiondefinitions of "accelerated filer," "large accelerated filer" and large
accelerated filer""smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer[filer [ ] Accelerated filer[X] Non-
accelerated filer[filer [x ]
Non-accelerated filer [ ] Smaller reporting company [ ]
Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act). YES[Yes [ ] NO[X]No [ x ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable
date.
On June 30,Class Outstanding at December 31, 2012
there were 9,383,156 shares of--------------------------------------- ---------------------------------
Common Stock, $.10 par value per share outstanding.9,502,720 shares
PATRIOT TRANSPORTATION HOLDING, INC.
FORM 10-Q
QUARTER ENDED JUNE 30,DECEMBER 31, 2012
CONTENTS
Page No.
Preliminary Note Regarding Forward-Looking Statements 3
PartPART I. Financial InformationFINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets 4
Consolidated Statements of Income 5
Consolidated Statements of Cash Flows 6
Condensed Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations 1514
Item 3. Quantitative and Qualitative Disclosures about Market Risks 2821
Item 4. Controls and Procedures 28
Part21
PART II. Other InformationOTHER INFORMATION
Item 1A. Risk Factors 3023
Item 2. Purchase of Equity Securities by the Issuer 3023
Item 6. Exhibits 3023
Signatures 3124
Exhibit 31 Certifications pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 3326
Exhibit 32 Certifications pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002. 3629
Preliminary Note Regarding Forward-Looking Statements.
Certain matters discussed in this report contain forward-looking statements that
are subject to risks and uncertainties that could cause actual results to differ
materially from those indicated by such forward-
lookingforward-looking statements.
These forward-looking statements relate to, among other things, capital
expenditures, liquidity, capital resources and competition and may be indicated
by words or phrases such as "anticipate", "estimate", "plans", "projects",
"continuing", "ongoing", "expects", "management believes", "the Company
believes", "the Company intends" and similar words or phrases. The following
factors and others discussed in the Company's periodic reports and filings with
the Securities and Exchange Commission are among the principal factors that
could cause actual results to differ materially from the forward-looking
statements: freight demand for petroleum products including recessionary and
terrorist impacts on travel in the Company's markets; levels of construction
activity in the markets served by our mining properties; fuel costs and the
Company's ability to recover fuel surcharges; accident severity and frequency;
risk insurance markets; driver availability and cost; the impact of future
regulations regarding the transportation industry; availability and terms of
financing; competition in our markets; interest rates, inflation and general
economic conditions; demand for flexible warehouse/office facilities in the
Baltimore-Washington-Northern Virginia area; and ability to obtain zoning and
entitlements necessary for property development. However, this list is not a
complete statement of all potential risks or uncertainties.
These forward-looking statements are made as of the date hereof based on
management's current expectations, and the Company does not undertake an
obligation to update such statements, whether as a result of new information,
future events or otherwise. Additional information regarding these and other
risk factors may be found in the Company's other filings made from time to time
with the Securities and Exchange Commission.
PART I. FINANCIAL INFORMATION, ITEM 1. FINANCIAL STATEMENTS
PATRIOT TRANSPORTATION HOLDING, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except share data)
June 30,December 31, September 30,
AssetsASSETS 2012 20112012
---- ----
Current assets:
Cash and cash equivalents $ 11,838 21,0261,440 6,713
Accounts receivable (net of allowance for
doubtful accounts of $136$135 and $111,$129, respectively) 9,345 6,7026,315 7,019
Real estate tax refund receivable 2,342 2,311
Federal and state income taxes receivable - 93426 426
Inventory of parts and supplies 970 1,121
Deferred income taxes 723 201988 843
Prepaid tires on equipment 1,556 1,3811,791 1,631
Prepaid taxes and licenses 232 1,8601,389 2,050
Prepaid insurance 688 2,1112,199 2,371
Prepaid expenses, other 119 85
Assets of discontinued operations 101 11475 70
Real estate held for sale, at cost 2,754 3,485
------ ------
Total current assets 25,572 34,69419,719 26,919
------ ------
Property, plant and equipment, at cost 333,610 313,930347,634 338,702
Less accumulated depreciation and depletion 110,525 104,942111,909 110,681
------- -------
Net property, plant and equipment 223,085 208,988235,725 228,021
------- -------
Real estate held for investment, at cost 6,848 6,8483,640 3,640
Investment in joint venture 7,523 7,4127,543 7,521
Goodwill 1,087 1,087
Unrealized rents 4,022 3,6044,298 4,155
Other assets 4,215 3,7574,682 4,362
------- -------
Total assets $272,352 266,390
Liabilities and Shareholders' Equity$276,694 275,705
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 5,225 3,9485,003 5,266
Deferred income taxes 58 58
Federal and state income taxes payable 939634 -
Accrued payroll and benefits 4,421 4,9923,781 5,164
Accrued insurance 2,986 3,3031,968 3,249
Accrued liabilities, other 634 1,0531,040 1,189
Long-term debt due within one year 5,152 4,902
Liabilities of discontinued operations 20 345,327 5,239
------ -------
Total current liabilities 19,377 18,23217,811 20,165
------ -------
Long-term debt, less current portion 58,474 62,37055,766 57,131
Deferred income taxes 17,939 16,91918,643 18,199
Accrued insurance 2,071 2,5481,659 1,659
Other liabilities 1,989 1,8743,907 3,833
Commitments and contingencies (Note 8)
Shareholders' equity:
Preferred stock, no par value;
5,000,000 shares authorized; none issued - -
Common stock, $.10 par value;
25,000,000 shares authorized,
9,383,1569,502,720 and 9,288,0239,440,620 shares issued
and outstanding, respectively 938 929950 944
Capital in excess of par value 40,686 38,84542,794 41,539
Retained earnings 130,847 124,642135,132 132,203
Accumulated other comprehensive income, net 31 3132 32
------- -------
Total shareholders' equity 172,502 164,447178,908 174,718
------- -------
Total liabilities and shareholders' equity $272,352 266,390$276,694 275,705
======= =======
See accompanying notes.
PATRIOT TRANSPORTATION HOLDING, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share amounts)
(Unaudited)
THREE MONTHS
NINE MONTHS
ENDED JUNE 30, ENDED JUNE 30,DECEMBER 31,
------------------
2012 2011
2012 2011
Revenues:---- ----
REVENUES:
Transportation $26,907 26,182 77,197 72,209$26,639 24,841
Mining royalty land 1,101 1,180 3,103 3,1931,331 977
Developed property rentals 5,022 4,585 14,415 13,3985,087 4,541
------ ------
Total revenues 33,030 31,947 94,715 88,800
Cost of operations:33,057 30,359
COST OF OPERATIONS:
Transportation 24,621 23,738 71,678 65,77524,842 23,398
Mining royalty land 307 334 923 1,025308 293
Developed property rentals 3,117 3,267 9,620 9,9123,236 3,162
Unallocated corporate 94 167 945 1,275263 292
------ -------
Total cost of operations 28,139 27,506 83,166 77,987
Operating profit:28,649 27,145
OPERATING PROFIT:
Transportation 2,286 2,444 5,519 6,4341,797 1,443
Mining royalty land 794 846 2,180 2,1681,023 684
Developed property rentals 1,905 1,318 4,795 3,4861,851 1,379
Unallocated corporate (94) (167) (945) (1,275)(263) (292)
------ ------
Total operating profit 4,891 4,441 11,549 10,8134,408 3,214
Gain on termination of sale contract - - 1,039
Gain on investment land sold 1,116 -
Interest income and other (expense)
income, net (10) 70 11 27132 9
Equity in loss of joint venture - (14) (8) (16)(7)
Interest expense (537) (789) (2,135) (2,533)(428) (804)
------ ------
Income before income taxes 4,344 3,708 10,456 8,5355,120 3,451
Provision for income taxes (1,668) (1,349) (4,016) (3,203)
Income from continuing operations 2,676 2,359 6,440 5,332
Income(1,997) (1,326)
------ ------
INCOME FROM CONTINUING OPERATIONS 3,123 2,125
Loss from discontinued
operations, net 8 20 11 5,125
Net income- (1)
------- ------
NET INCOME $ 2,684 2,379 6,451 10,457
Comprehensive Income3,123 2,124
======= ======
COMPREHENSIVE INCOME $ 2,684 $ 2,379 $ 6,451 $10,457
Earnings per common share:3,123 2,124
======= ======
EARNINGS PER COMMON SHARE:
Income from continuing operations -
Basic $ .29 .25 .69 .57.33 .23
Diluted $ .28 .25 .68 .56.33 .23
Discontinued operations (Note 11) -
Basic $ - .01 - .56
Diluted $ - - - .55
Net income - basic $ .29 .26 .69 1.13.33 .23
Net income - diluted $ .28 .25 .68 1.11.33 .23
Number of shares (in thousands)
used in computing:
-basic earnings per common share 9,382 9,291 9,341 9,2799,452 9,290
-diluted earnings per common share 9,482 9,443 9,458 9,4539,549 9,422
See accompanying notes.
PATRIOT TRANSPORTATION HOLDING, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINETHREE MONTHS ENDED JUNE 30,DECEMBER 31, 2012 AND 2011
(In thousands)
(Unaudited)
2012 2011
Cash flows from operating activities:---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 6,451 10,4573,123 2,124
Adjustments to reconcile net income to net cash
provided by continuing operating activities:
Depreciation, depletion and amortization 9,502 9,1263,271 3,083
Deferred income taxes 498 (813)444 -
Equity in loss of joint venture 8 167
Gain on sale of equipment and property (1,639) (245)
Income(1,307) (1,051)
Loss from discontinued operations, net (11) (5,125)- 1
Stock-based compensation 633 624130 136
Net changes in operating assets and liabilities:
Accounts receivable (393) (1,848)704 234
Inventory of parts and supplies 151 (373)(145) 132
Prepaid expenses and other current assets 2,842 2,997668 894
Other assets (1,431) 54(680) (368)
Accounts payable and accrued liabilities (30) 628(3,076) (870)
Income taxes payable and receivable 1,032 2,917634 1,014
Long-term insurance liabilities and other long-term
liabilities (362) 15974 30
------- -------
Net cash provided by operating activities of
continuing operations 17,251 18,574
Net cash provided by (used in) operating activities of
discontinued operations 10 (605)3,848 5,366
Net cash provided by operating activities 17,261 17,969
Cash flows from investing activities:of
discontinued operations - 4
------- -------
Net cash provided by operating activities 3,848 5,370
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of transportation group property and equipment (6,605) (4,660)(6,787) (4,789)
Investments in developed property rentals segment (7,911) (8,365)
Investments in mining royalty land (11,039) -(4,164) (2,589)
Investment in joint venture (125) (114)(32) (70)
Proceeds from the sale of property, plant and equipment 1,906 528
Proceeds received on note for sale of SunBelt - 3,9472,202 1,069
------- -------
Net cash used in investing activities (23,774) (8,664)
Cash flows from financing activities:(8,781) (6,379)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt (3,646) (3,412)(1,277) (1,195)
Repurchase of Company Stock (315) (1,145)(233) (137)
Excess tax benefits from exercises of stock options
and vesting of restricted stock 452 323407 145
Exercise of employee stock options 834 538763 220
------- -------
Net cash used in financing activities (2,675) (3,696)
Net increase/(decrease) in cash and cash equivalents (9,188) 5,609(340) (967)
------- -------
NET (DECREASE) IN CASH AND CASH EQUIVALENTS (5,273) (1,976)
Cash and cash equivalents at beginning of period 6,713 21,026
17,151------- -------
Cash and cash equivalents at end of the period $ 11,838 22,7601,440 19,050
======= =======
The Company recorded non-cash transactions in fiscal 2012 for a $2,250 receivable on previously
capitalized real estate taxes on the Anacostia property of $31 and $2,043 in
first quarter fiscal 2011 from an exchange of real estate of $4,941 along
with a related deferred tax liability of $1,7922013 and a $2,053 permanent tax
benefit on the value of donated minerals and aggregates which was recorded
as a $342 receivable and $1,711 deferred tax.2012 respectively.
See accompanying notes.
PATRIOT TRANSPORTATION HOLDING, INC. AND SUBSIDIARIES CONDENSED NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30,DECEMBER 31, 2012
(Unaudited)
(1) Basis of Presentation.BASIS OF PRESENTATION. The accompanying consolidated financial statements
include the accounts of Patriot Transportation Holding, Inc. and its
subsidiaries (the "Company"). Investment in the 50% owned Brooksville Joint
Venture is accounted for under the equity method of accounting. These statements
have been prepared in accordance with accounting principles generally accepted
in the United States of America for interim financial information and the
instructions to Form 10-Q and do not include all the information and footnotes
required by accounting principles generally accepted in the United States of
America for complete financial statements. In the opinion of management, all
adjustments (primarily consisting of normal recurring accruals) considered
necessary for a fair statement of the results for the interim periods have been
included. Operating results for the ninethree months ended June 30,December 31, 2012 are not
necessarily indicative of the results that may be expected for the fiscal year
ending September 30, 2012.2013. The accompanying consolidated financial statements
and the information included under the heading "Management's Discussion and
Analysis of Financial Condition and Results of Operations" should be read in
conjunction with the Company's consolidated financial statements and related
notes included in the Company's Form 10-K for the year ended September 30, 2011.2012.
(2) Stock Split.STOCK SPLIT. On December 1, 2010, the boardBoard of directorsDirectors declared a 3-for-1
stock split of the Company's common stock in the form of a stock dividend. The
record date for the split was January 3, 2011 and the new shares were issued on
January 17, 2011. The total authorized shares remained 25 million and par value
of common stock remained unchanged at $.10 per share. All share and per share
information presented has been adjusted to reflect this stock split.
(3) Recent Accounting Pronouncements.RECENT ACCOUNTING PRONOUNCEMENTS. In June 2011, accounting guidance was
issued whichthat requires an entity to present the total of comprehensive income, the
components of net income, and the components of other comprehensive income
either in a single continuous statement of comprehensive income or in two
separate but consecutive statements. This guidance eliminates the option to
present the components of other comprehensive income as part of the statement of
equity. This standard was adopted by the Company on January 1, 2012. As the new
adoption relates to presentation only, the adoption of this standard did not
have a material effect on the Company's financial position or results of
operations.
(4) Business Segments.BUSINESS SEGMENTS. The Company operates in three reportable business
segments. The Company's operations are substantially in the Southeastern and
Mid-Atlantic states. The transportation segment hauls petroleum and other
liquids and dry bulk commodities by tank trailers. The Company's real estate
operations consist of two reportable segments. The Mining royalty land segment
owns real estate including construction aggregate royalty sites and parcels held
for investment. The Developed property rentals segment acquires, constructs, and
leases office/warehouse buildings primarily in the Baltimore/Northern
Virginia/Washington area, and holds real estate for future development or
related to its developments.
The Company's transportation and real estate groups operate independently and
have minimal shared overhead except for corporate expenses. Corporate expenses
are allocated in fixed quarterly amounts based upon budgeted and estimated
proportionate cost by segment. Unallocated corporate expenses primarily include
stock compensation and corporate aircraft expenses.
Operating results and certain other financial data for the Company's business
segments are as follows (in thousands):
Three Months ended
Nine months ended
June 30,___ June 30,___December 31,
----------------------
2012 2011
2012 2011---- ----
Revenues:
Transportation $ 26,907 26,182 77,197 72,20926,639 24,841
Mining royalty land 1,101 1,180 3,103 3,1931,331 977
Developed property rentals 5,022 4,585 14,415 13,3985,087 4,541
------ ------
$ 33,030 31,947 94,715 88,80033,057 30,359
====== ======
Operating profit:
Transportation $ 2,682 2,834 6,706 7,6032,268 1,838
Mining royalty land 958 999 2,671 2,6261,199 848
Developed property rentals 2,150 1,547 5,531 4,1722,115 1,624
Corporate expenses:
Allocated to transportation (396) (390) (1,187) (1,169)(471) (395)
Allocated to mining land (176) (164) (153) (491) (458)
Allocated to developed property (264) (245)
(229) (736) (686)
Unallocated (94) (167) (945) (1,275)
(899) (939) (3,359) (3,588)(263) (292)
------ ------
(1,174) (1,096)
------ ------
$ 4,891 4,441 11,549 10,8134,408 3,214
====== ======
Interest expense:
Mining royalty land $ 11 10 9 29 27
Developed property rentals ___527 _ 780 2,106 2,506417 794
------ ------
$ 537 789 2,135 2,533428 804
====== ======
Capital expenditures:
Transportation $ 1,202 1,501 6,605 4,6606,787 4,789
Mining royalty land 11,039 - 11,039 -
Developed property rentals:
Capitalized interest 533 345 1,111 928591 294
Internal labor 173 190 431 450110 141
Real estate taxes (a) 243 303 (1,454) 875251 (1,607)
Other costs (b) 2,916 2,517 5,573 6,1123,212 1,718
------ ------
$ 16,106 4,856 23,305 13,02510,951 5,335
====== ======
(a)Includes a $2,250 adjustment related to a$31 and $2,043 receivable on previously capitalized real estate
taxes on the Anacostia property for the 9three months ended June 30, 2012.
(b)Net of 1031 exchange of $4,941 for the 3December 31, 2012 and
9 months ending June 30,
2011.December 31, 2011, respectively.
Depreciation, depletion and
amortization:
Transportation $ 1,690 1,582 5,018 4,6801,753 1,608
Mining royalty land 27 29 86 8025 32
Developed property rentals 1,382 1,300 4,096 3,9171,388 1,341
Other 97 54 302 449105 102
------ ------
$ 3,196 2,965 9,502 9,126
June 30,3,271 3,083
====== ======
December 31, September 30,
2012 20112012
---- ----
Identifiable net assets
Transportation $ 38,854 39,001
Discontinued transportation operations 101 11447,293 42,642
Mining royalty land 39,469 28,29539,436 39,695
Developed property rentals 179,532 175,618186,692 184,358
Cash items 11,838 21,0261,440 6,713
Unallocated corporate assets 2,558 2,336
$272,352 266,3901,833 2,297
------- -------
$276,694 275,705
======= =======
(5) Long-Term debt.LONG-TERM DEBT. Long-term debt is summarized as follows (in thousands):
June 30,December 31, September 30,
2012 20112012
---- ----
5.6% to 8.6% mortgage notes
due in installments through 2027 63,626 67,27261,093 62,370
Less portion due within one year 5,152 4,9025,327 5,239
------ ------
$ 58,474 62,37055,766 57,131
====== ======
On December 21, 2012, the Company entered into a modified credit agreement with
Wells Fargo Bank, N.A. (the "Credit Agreement"). The Company has a $37,000,000 uncollateralizedCredit Agreement modifies
the Company's prior Amended and Restated Revolving Credit Agreement with
three banks, which matures on December 13, 2013.Wachovia Bank, National Association ("Wachovia"), Bank of America, N.A.,
SunTrust Bank, and Compass Bank dated as of November 10, 2004. The RevolverCredit
Agreement is for a 5 year term with a maximum facility amount of $55 million.
The Credit Agreement provides a revolving credit facility (the "Revolver") with
a maximum facility amount of $40 million, with a $20 million sublimit for
standby letters of credit, and a term loan facility of $15 million. Wells Fargo
Bank, N.A. is the sole lender under the modified Credit Agreement. The Credit
Agreement bears interest at a rate of 1.00% over the selected LIBOR, which may
change quarterly based on the Company's ratio of Consolidated Total Debt to
Consolidated Total Capital, as defined. A commitment fee of 0.15% per annum is
payable quarterly on the unused portion of the commitment.Revolver portion of the credit
agreement. The commitment fee may also change quarterly based upon the ratio
described above. The RevolverCredit Agreement contains limitations on availabilitycertain conditions, affirmative
financial covenants and restrictivenegative covenants including limitations on paying cash
dividends. Letters of credit in the amount of $8,953,000$9,009,000 were issued under the
Revolver. As of June 30,December 31, 2012, $28,047,000$45,991,000 was available for borrowing and
$55,735,000$58,719,000 of consolidated retained earnings would be available for payment of
dividends. The Company was in compliance with all covenants as of June
30,December 31,
2012.
The fair values of the Company's mortgage notes payable were estimated based on
current rates available to the Company for debt of the same remaining
maturities. At June 30,December 31, 2012, the carrying amount and fair value of such
other long-term debt was $63,626,000$61,093,000 and $67,968,000,$65,892,000, respectively.
(6) Earnings per share.EARNINGS PER SHARE. The following details the computations of the basic and
diluted earnings per common share (dollars in thousands, except per share
amounts):
THREE MONTHS
NINE MONTHS
ENDED JUNE 30, ENDED JUNE 30,DECEMBER 31,
------------------
2012 2011
2012 2011---- ----
Weighted average common shares
outstanding during the period
- shares used for basic
earnings per common share 9,382 9,291 9,341 9,2799,452 9,290
Common shares issuable under
share based payment plans
which are potentially dilutive 100 152 117 17497 132
----- -----
Common shares used for diluted
earnings per common share 9,482 9,443 9,458 9,4539,549 9,422
===== =====
Net income $ 2,684 2,379 6,451 10,4573,123 2,124
===== =====
Earnings per common share
Basic $ .29 .26 .69 1.13.33 .23
===== =====
Diluted $ .28 .25 .68 1.11.33 .23
===== =====
For the three and nine months ended June 30,December 31, 2012, 172,060173,240 shares attributable to
outstanding stock options were excluded from the calculation of diluted earnings
per share because their inclusion would have been anti-dilutive. For the three
and nine months ended June 30,December 31, 2011, 140,370 and 132,870172,060 shares attributable to outstanding stock
options were excluded from the calculation of diluted earnings per common share
because their inclusion would have been anti-dilutive.
(7) Stock-Based Compensation Plans.STOCK-BASED COMPENSATION PLANS. As more fully described in Note 7 to the
Company's notes to the consolidated financial statements in the Company's Annual
Report on Form 10-K for the year ended September 30, 2011,2012, the Company's
stock-based compensation plan permits the grant of stock options, stock
appreciation rights, restricted stock awards, restricted stock units, and stock
awards. The number of common shares available for future issuance was 603,560557,380 at
June 30,December 31, 2012.
The Company recorded the following stock compensation expense in its
consolidated statements of income (in thousands):
Three Months ended
Nine months ended
June 30, June 30,_
2012 2011December 31,
2012 2011
Stock option grants $ 86 79 313 290
Annual director stock award - - 320 334
86 79 633 624130 136
A summary of changes in outstanding options is presented below (in thousands,
except share and per share amounts):
Weighted Weighted Weighted
Number Average Average Average
Of Exercise Remaining Grant Date
Options Shares Price Term (yrs) Fair Value
------- ------- -------- --------- ----------
Outstanding at
October 1, 2011 606,025 $14.962012 481,210 $17.52 3.8 $ 3,782
Granted 46,180 $26.20 $ 489
Exercised 70,800 $10.78 $ 388
-------
Outstanding at
December 31, 2012 456,590 $19.45 4.5 $ 3,883
Exercisable at
December 31, 2012 360,578 $17.81 3.5 $ 4,216
Granted 31,690 $22.25 $ 281
Exercised 96,041 $ 8.68 $ 452
Forfeited 3,000 $ 5.78 $ 10
Outstanding at
June 30, 2012 538,674 $16.56 3.7 $ 4,035
Exercisable at
June 30, 2012 463,430 $15.13 2.9 $ 3,2382,847
Vested during
ninethree months ended
June 30,December 31, 2012 30,77420,612 $ 319199
The aggregate intrinsic value of exercisable in-the-money options was $4,243,000$3,910,000
and the aggregate intrinsic value of all outstanding in-the-
moneyin-the-money options was
$4,274,000$4,213,000 based on the market closing price of $23.53$28.43 on June 29,December 31, 2012 less
exercise prices. Gains of $1,235,000$1,050,000 were realized by option holders during the
ninethree months ended June 30,December 31, 2012. The realized tax benefit from options
exercised for the ninethree months ended June 30,December 31, 2012 was $474,000.$407,000. Total
compensation cost of options granted but not yet vested as of June 30,December 31, 2012
was $665,000,$956,000, which is expected to be recognized over a weighted-average period
of 2.73.7 years.
(8) Contingent liabilities.CONTINGENT LIABILITIES. Certain of the Company's subsidiaries are involved
in litigation on a number of matters and are subject to certain claims which
arise in the normal course of business. The Company has retained certain
self-insurance risks with respect to losses for third party liability and
property damage. There is a reasonable possibility that the Company's estimate
of vehicle and workers' compensation liability for the transportation group or discontinued operations may be
understated or overstated but the possible range can not be estimated. The
liability at any point in time depends upon the relative ages and amounts of the
individual open claims. In the opinion of management, none of these matters are
expected to have a material adverse effect on the Company's consolidated
financial condition, results of operations or cash flows.
(9) Concentrations.CONCENTRATIONS. The transportation segment primarily serves customers in the
industries in the Southeastern U.S. Significant economic disruption or downturn
in this geographic region or these industries could have an adverse effect on
our financial statements.
During the first ninethree months of fiscal 2012,2013, the transportation segment's ten
largest customers accounted for approximately 53.4%55.8% of the transportation
segment's revenue. One of these customers accounted for 19.2%21.0% of the
transportation segment's revenue. The loss of any one of these customers would
have an adverse effect on the Company's revenues and income. Accounts receivable
from the transportation segment's ten largest customers was $3,068,000$3,464,000 and
$3,115,000$2,988,000 at June 30,December 31, 2012 and September 30, 20112012 respectively.
The mining royalty land segment has one lessee that accounted for 76.0%73.9% of the
segment's revenues and $147,000$151,000 of accounts receivable at June 30,December 31, 2012. The
loss of this customer would have an adverse effect on the segment.
The Company places its cash and cash equivalents with high credit quality
institutions. At times, such amounts may exceed FDIC limits.
(10) Fair Value Measurements.FAIR VALUE MEASUREMENTS. Fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The fair value
hierarchy prioritizes the inputs to valuation techniques used to measure fair
value into three broad levels. Level 1 means the use of quoted prices in active
markets for identical assets or liabilities. Level 2 means the use of values
that are derived principally from or corroborated by observable market data.
Level 3 means the use of inputs that are unobservable and significant to the
overall fair value measurement.
As of June 30,December 31, 2012 the Company had no assets or liabilities measured at
fair value on a recurring basis or non-recurring basis. During fiscal
2011 the corporate aircraft was placed back into service and depreciation
was recommenced. Prior to that it was recorded at fair value based on
level 2 inputs for similar assets in the current market on a non-
recurring basis as it was deemed to be other-than-temporarily impaired.
The first quarter of fiscal 2011 included $300,000 for the impairment to
estimated fair value of the corporate aircraft.
The fair value of all other financial instruments with the exception of mortgage
notes (see Note 5) approximates the carrying value due to the short-term nature
of such instruments.
(11) Discontinued operations.DISCONTINUED OPERATIONS. In August 2009, the Company sold its flatbed
trucking company, SunBelt Transport, Inc. ("SunBelt"). Under the agreement, the
Buyer purchased all of SunBelt's tractors and trailers, leased the SunBelt
terminal facilities in Jacksonville, Florida for 36 months at a rental of $5,000
per month and leased the terminal facilities in South Pittsburg, Tennessee for
60 months at a rental of $5,000 per month with an option to purchase the
Tennessee facilities at the end of the lease for payment of an additional
$100,000. The South Pittsburg lease was recorded as a sale under bargain
purchase accounting. The purchase price received for the tractors and trailers
and inventories was a $1 million cash payment and the delivery of a Promissory
Note requiring 60 monthly payments of $130,000 each including interest at 7%,
secured by the assets of the business conveyed. As of September 30, 2011 the
note receivable was fully paid and the option to purchase the South Pittsburg
facility was completed. The Company retained all pre-closing receivables and
liabilities.
SunBelt has been accounted for as discontinued operations in accordance with ASC
Topic 205-20 Presentation of Financial Statements - Discontinued Operations. All
periods presented have been restated accordingly.
In December 2010, a subsidiary of the Company, Florida Rock Properties,
Inc., closed a bargain sale of approximately 1,777 acres of land in
Caroline County, Virginia, to the Commonwealth of Virginia, Board of Game
and Inland Fisheries. The purchase price for the property was
$5,200,000, subject to certain deductions. The Company also donated
$5,599,000 primarily for the value of minerals and aggregates and
recognized a $2,126,000 permanent tax benefit. The $2,126,000 permanent
tax benefit was recorded to income taxes receivable for $303,000 and
offset to long-term deferred tax liabilities of $1,823,000. Actual
realization of the $1,823,000 in deferred taxes will depend on taxable
income, income tax rates, and income tax regulations over the 5 year
carry forward period. The Company's book value of the property was
$276,000.
A summary of discontinued operations is as follows (in thousands):
Three months
Nine months
Ended June 30, Ended June 30,December 31,
------------------
2012 2011
2012 2011---- ----
Revenue $ - 15 15 45 45
Operating expenses 2 (18) 27 (278)- 16
Gain on sale before taxes - -
- 4,665
Income before income taxes $ 13 33 18 4,988
Permanent tax benefit - - - 2,053
Provision for income taxes (5) (13) (7) (1,916)
Income from discontinued operations $ 8 20 11 5,125
The amounts included in the above totals for the bargain sale is as
follows (in thousands):
Three months Nine months
Ended June 30, Ended June 30,
2012 2011 2012 2011
Revenue $ - - - -
Operating expenses - - - -
Gain on sale before taxes - - - 4,665----- -----
Income before income taxes $ - - - 4,665(1)
Permanent tax benefit - - - 2,053
Provision for income taxes - -
- (1,792)
Income----- -----
Loss from discontinued operations $ - - - 4,926
The components(1)
===== =====
(12) REAL ESTATE HELD FOR SALE.
In September 2012 the Company received a non-binding letter of intent to sell
phase 1 of the balance sheet are as follows:
June 30, September 30,
2012 2011
Accounts receivable $ - 3
DeferredWindlass Run Residential property located in southeastern
Baltimore County, Maryland. The property is under contract and expected to close
during fiscal 2013 for $7.9 million.
(13) UNUSUAL OR INFREQUENT ITEMS IMPACTING QUARTERLY RESULTS. Income from
continuing operations for the first quarter of fiscal 2013 included a gain on
the sale of the developed property rentals Commonwealth property of $1,116,000
before income taxes 2 4
Property and equipment, net 99 107
Assetstaxes. The book value of discontinued operations $ 101 114
Accrued payroll and benefits 2 2
Accrued liabilities, other - 3
Insurance liabilities 18 29
Liabilities of discontinued operations $ 20 34
(12) Unusual or Infrequent Items Impacting Quarterly Results.the property was $723,000.
Income from continuing operations for the first quarter of fiscal 2012 included
a gain on termination of sale contract in the amount of $1,039,000 before income
taxes for the receipt of non-refundable deposits related to the termination of
an agreement to sell the Company's Windlass Run Residential property
Discontinued operations, netproperty.
Accrued insurance liabilities decreased $1,281,000 during the quarter ending
December 31, 2012 due to payments to our new insurer under a captive agreement
along with payment in settlement of three unusually large prior year liability
and health claims. Payments under the captive agreement are for the first quarterfiscal 2013
year-to-date loss fund as estimated in advance using actuarial methodology. The
captive agreement provides that we will share in the underwriting results, good
or bad, within a $250,000 per occurrence layer of fiscal 2011
included a book gain on the exchange of property of $4,926,000 after tax
(see note 11).loss through retrospective
premium adjustments.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Overview - Patriot Transportation Holding, Inc. (the Company) is a holding
company engaged in the transportation and real estate businesses.
The Company's transportation business, Florida Rock & Tank Lines, Inc. is
engaged in hauling primarily petroleum and other liquids and dry bulk
commodities in tank trailers.
The Company's real estate operations consist of two reportable segments. The
Mining royalty land segment owns real estate including construction aggregate
royalty sites and parcels held for investment. The Developed property rentals
segment acquires, constructs, leases, operates and leasesmanages office/warehouse
buildings primarily in the Baltimore/Northern Virginia/Washington area, and
holds real estate for future development or related to its developments.
Substantially all of the real estate operations are conducted within the
Southeastern and Mid-Atlantic United States.
On December 1, 2010, the board of directors declared a 3-for-1 stock
split of the Company's common stock in the form of a stock dividend. The
record date for the split was January 3, 2011 and the new shares were
issued on January 17, 2011. All share and per share information
presented has been adjusted to reflect this stock split.
The Company's operations are influenced by a number of external and internal
factors. External factors include levels of economic and industrial activity in
the United States and the Southeast, driver availability and cost, regulations
regarding driver qualifications and hours of service, petroleum product usage in
the Southeast which is driven in part by tourism and commercial aviation, fuel
costs, construction activity, aggregates sales by lessees from the Company's
mining properties, interest rates, market conditions and attendant prices for
casualty insurance, demand for commercial warehouse space in the
Baltimore-Washington-Northern Virginia area, and ability to obtain zoning and
entitlements necessary for property development. Internal factors include
revenue mix, capacity utilization, auto and workers' compensation accident
frequencies and severity, other operating factors, administrative costs, group
health claims experience, and construction costs of new projects. There is a
reasonable possibility that the Company's estimate of vehicle and workers'
compensation liability for the transportation group or discontinued operations may be understated or
overstated but the possible range can not be estimated. The liability at any
point in time depends upon the relative ages and amounts of the individual open
claims. Financial results of the Company for any individual quarter are not
necessarily indicative of results to be expected for the year.
Discontinued Operations. In August 2009 the Company sold its flatbed
trucking company, SunBelt Transport, Inc. ("SunBelt"). Under the
agreement, the buyer purchased all of SunBelt's tractors and trailers,
leased the SunBelt terminal facilities in Jacksonville, Florida for 36
months at a rental of $5,000 per month and leased the terminal facilities
in South Pittsburg, Tennessee for 60 months at a rental of $5,000 per
month with an option to purchase the Tennessee facilities at the end of
the lease for payment of an additional $100,000. The South Pittsburg
lease was recorded as a sale under bargain purchase accounting. The
purchase price received for the tractors and trailers and inventories was
a $1 million cash payment and the delivery of a Promissory Note requiring
60 monthly payments of $130,000 each including interest at 7%, secured by
the assets of the business conveyed. As of September 30,COMPARATIVE RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2012
AND 2011
the note
receivable has been fully paid and the option to purchase the South
Pittsburg facility was completed. The Company retained all pre-closing
receivables and liabilities. SunBelt has been accounted for as
discontinued operations in accordance with ASC Topic 205-20 Presentation
of Financial Statements - Discontinued Operations. All periods presented
have been restated accordingly.
In December 2010, a subsidiary of the Company, Florida Rock Properties,
Inc., closed a bargain sale of approximately 1,777 acres of land in
Caroline County, Virginia, to the Commonwealth of Virginia, Board of Game
and Inland Fisheries. The purchase price for the property was
$5,200,000, subject to certain deductions. The Company also donated
$5,599,000 primarily for the value of minerals and aggregates and
recognized a $2,126,000 permanent tax benefit. The $2,126,000 permanent
tax benefit was recorded to income taxes receivable for $303,000 and
offset to long-term deferred tax liabilities of $1,823,000. Actual
realization of the $1,823,000 in deferred taxes will depend on taxable
income, income tax rates, and income tax regulations over the 5 year
carry forward period. The Company's book value of the property was
$276,000. Caroline County has been accounted for as discontinued
operations in accordance with ASC Topic 205-20 Presentation of Financial
Statements - Discontinued Operations. All periods presented have been
restated accordingly.
Comparative Results of Operations for the Three months ended June 30,
2012 and 2011
Consolidated ResultsCONSOLIDATED RESULTS - Net income for the thirdfirst quarter of fiscal 20122013 was
$2,684,000$3,123,000 compared to $2,379,000$2,124,000 for the same period last year. Diluted
earnings per common share for the thirdfirst quarter of fiscal 20122013 were $.28$.33
compared to $.25$.23 for the same quarter last year. Transportation segment results
were lowerhigher due to incremental profits on increased health insurance and workers
compensation claim costs along withrevenue, higher vehicle repairs, increased
tire prices, and cost of growth initiatives partially offset by increased gains on
equipment sales and incremental profits onlower than expected health insurance claims partially offset
by increased revenues.vehicle repairs costs, increased site maintenance, and increased
sales, general and administrative expenses. The mining royalty land segment's
results were lowerhigher due to reduced tons
mined onnew property owned by the Companyroyalties partially offset by reduced
allocation of indirect management company costs to this segment.increased
corporate expense allocation. The Developed property rentals segment's results
were higher due to higher occupancy and lower real estate taxes, maintenance costs and professional fees partially offset
by higher allocation of indirect management company
costs.
Transportation Resultshealth insurance claims allocation.
TRANSPORTATION RESULTS
----------------------
Three months ended June 30December 31
------------------------------
(dollars in thousands) ___20122012 % 2011 %_
--------- --- --------- ----
Transportation revenue $ 22,05221,991 83% 20,316 82% 20,806 79%
Fuel surcharges 4,8554,648 17% 4,525 18%
5,376 21%-------- ---- ------ ----
Revenues 26,90726,639 100% 26,18224,841 100%
Compensation and benefits 9,3489,434 35% 9,0478,782 35%
Fuel expenses 6,002 23% 6,256 24% 5,880 24%
Insurance and losses 2,1751,888 7% 1,995 8% 1,799 7%
Depreciation expense 1,6421,707 6% 1,5541,575 6%
Other, net 2,9653,005 11% 2,7652,767 11%
Sales, general & administrative 2,0932,307 9% 2,007 8% 1,927 7%
Allocated corporate expenses _____396 1% ___390 1%471 2% 395 2%
Gain on equipment sales (226) (1%) (3) 0%
-------- ---- ------ ----
Cost of operations 24,621 92% 23,738 91%24,842 93% 23,398 94%
-------- ---- ------ ----
Operating profit $ 2,286 8% 2,444 9%1,797 7% 1,443 6%
======== ==== ====== ====
Transportation segment revenues were $26,907,000$26,639,000 in the thirdfirst quarter of 2012,2013,
an increase of $725,000$1,798,000 over the same quarter last year. Revenue miles in the
current quarter were up .4%3.4% compared to the thirdfirst quarter of fiscal 20112012 due to
business growth partially offset by a shorter average
haul length.growth. Revenue per mile increased 2.4%3.8% over the same quarter last year
due to rate increases a lower average haul length partially offset
by lowerand higher fuel surcharges. Fuel surcharge revenue
decreased $521,000increased $123,000 due to lowerhigher fuel costs andpartially offset by changes to
certain customer rates to incorporate fuel surcharges into base rates. The
average price paid per gallon of diesel fuel decreasedincreased by $.06$.17 or 1.7%4.7% over the
same quarter in fiscal 2011.2012. There is a time lag between changes in fuel prices
and surcharges and often fuel costs change more rapidly than the market indexes
used to determine fuel surcharges. Excluding fuel surcharges, revenue per mile
increased 5.6%4.6% over the same quarter last year.
The Transportation segment's cost of operations was $24,621,000$24,842,000 in the thirdfirst
quarter of 2012,2013, an increase of $883,000$1,444,000 over the same quarter last year. The
Transportation segment's cost of operations in the thirdfirst quarter of 20122013 as a
percentage of revenue was 92%93% compared to 91%94% in the thirdfirst quarter of 2011.2012.
Compensation and benefits increased $301,000$652,000 or 3.3%7.4% compared to the same
quarter last year primarily due to a driver pay increase and the increase in
miles driven. Fuel cost decreasedincreased by $254,000$376,000 due to lowerhigher cost per gallon and
improvedthe increase in miles per gallon.driven. Insurance and losses increased $376,000decreased $107,000 compared
to the same quarter last year primarily due to higher health insurance and workers compensation
claims. Insurance costs were higher than expected during the third
quarter of 2012 while lower than expected in the same quarter last year.health
insurance claims. Depreciation expense increased $88,000$132,000 due to more trucks in
service. Other expense increased $200,000$238,000 due to higher vehicle repair costs,
increased site maintenance, increased tire prices and increased miles driven, and growth initiatives
partially offset by higher gains on equipment sales. Sellingdriven.
Sales, general and administrative costs increased $166,000$300,000 or 8.6%14.9% compared to
the same quarter last year due to higher staffingseverance costs, increased bonus compensation
and professional fees. Allocated corporate expenses increased $6,000.
Mining Royalty Land Results$76,000. Gains on
equipment sales increased $223,000 due to increased sales of tractors and
trailers and higher sales value on used equipment.
MINING ROYALTY LAND RESULTS
---------------------------
Three months ended June 30December 31
------------------------------
(dollars in thousands) ___20122012 % 2011 %_%
--------- --- --------- ----
Mining royalty land revenue $ 1,1011,331 100% 1,180977 100%
Property operating expenses 116 11% 113112 8% 99 10%
Depreciation and depletion 2725 2% 30 2%32 3%
Management Company indirect -(5) 0% 38 3%(2) 0%
Allocated corporate expense 176 13% 164 15% 153 13%17%
------- ---- ------ ----
Cost of operations 307 28% 334 28%308 23% 293 30%
------- ---- ------ ----
Operating profit $ 794 72% 846 72%1,023 77% 684 70%
======= ==== ====== ====
Mining royalty land segment revenues for the thirdfirst quarter of fiscal 20122013 were
$1,101,000, a decrease$1,331,000, an increase of $79,000$354,000 or
6.7%36.2% over the same quarter last year due to reducednew property royalties and higher
tons mined on property owned by the Company partially
offset by royalties on new mining property.mined.
The mining royalty land segment's cost of operations was $307,000$308,000 in the thirdfirst
quarter of 2012, a decrease2013, an increase of $27,000$15,000 over the same quarter last year due
primarily to reduced allocation of indirect management company
costs to this segment. Allocatedthe $12,000 increase in allocated corporate expenses increased $11,000.
Developed Property Rentals Resultsexpenses.
DEVELOPED PROPERTY RENTALS RESULTS
----------------------------------
Three months ended June 30December 31
------------------------------
(dollars in thousands) ___20122012 % 2011 %_%
--------- --- --------- ----
Developed property rentals revenue $ 5,0225,087 100% 4,5854,541 100%
Property operating expenses 1,079 21% 1,392 30%1,117 22% 1,216 27%
Depreciation and amortization 1,3821,430 28% 1,300 28%1,341 30%
Management Company indirect 411 8% 346425 9% 360 8%
Allocated corporate expense 264 5% 245 5%
229 5%------- ---- ------ ----
Cost of operations 3,117 62% 3,267 71%3,236 64% 3,162 70%
------- ---- ------ ----
Operating profit $ 1,905 38% 1,318 29%1,851 36% 1,379 30%
======== ==== ====== ====
Developed property rentals segment revenues for the thirdfirst quarter of fiscal 20122013
were $5,022,000,$5,087,000, an increase of $437,000$546,000 or 9.5%12.0% due to higher occupancy.
Occupancy at June 30,December 31, 2012 was 87.0%86.2% as compared to 82.2%82.8% at June 30,December 31,
2011.
Developed property rentals segment's cost of operations was $3,117,000$3,236,000 in the
thirdfirst quarter of 2012, a decrease2013, an increase of $150,000$74,000 or 4.6%2.3% over the same quarter last
year. Property operating expenses decreased $313,000$99,000 due to lower real estate taxes, maintenance costs and professional
fees. Depreciation and amortization increased $82,000$89,000 primarily due to tenant
improvements. Management Company indirect expenses (excluding internal
allocations for lease related property management and construction fees)
increased $65,000 due to increased allocation to this segment and growth initiatives.higher health insurance claims. Allocated corporate
expenses increased $16,000.
Consolidated Results
Operating Profit$19,000.
CONSOLIDATED RESULTS
OPERATING PROFIT - Consolidated operating profit was $4,891,000$4,408,000 in the thirdfirst
quarter of fiscal 2012,2013, an increase of $450,000$1,194,000 or 10.1%37.1% compared to
$4,441,000$3,214,000 in the same period last year. Operating profit in the transportation
segment decreased $158,000increased $354,000 or 6.5% primarily24.5% due to incremental profits on increased
health insurance and workers compensation claim costs along
withrevenue, higher vehicle repairs, increased tire prices, and cost of growth
initiatives partially offset by increased gains on equipment sales and incremental profits onlower than expected health
insurance claims partially offset by increased revenues.vehicle repairs costs, increased
site maintenance, and increased sales, general and administrative expenses.
Operating profit in the mining royalty land segment decreased $52,000increased $339,000 or 6.1%49.6%
due to reduced tons
mined onnew property owned by the Companyroyalties partially offset by reduced
allocation of indirect management company costs to this segment.increased corporate expense
allocation. Operating profit in the Developed property rentals segment increased
$587,000$472,000 or 44.5%34.2% due to higher occupancy and lower real estate taxes,
maintenance costs and professional fees partially
offset by higher allocation of indirect management company costs.health insurance claims allocation. Consolidated operating
profit includes corporate expenses not allocated to any segment in the amount of
$94,000$263,000 in the thirdfirst quarter of fiscal 2012,2013, a decrease of $73,000$29,000 compared to
the same period last year.
Interest income and other (expense) income, netGAIN ON TERMINATION OF SALE CONTRACT - Interest income and
other (expense) income, net decreased $80,000 over the sameFirst quarter last
year due to the prepayment of notes receivable from the sale of SunBelt
Transport.
Interest expense - Interest expense decreased $252,000 over the same
quarter last year due to declining mortgage interest expense and higher
capitalized interest.
Income taxes - Income tax expense increased $319,000 over the same
quarter last year due to higher earnings from continuing operations and a
lower than usual tax rate in the same quarter last year caused by tax
credits and reductions in uncertain tax positions.
Income from continuing operations - Income from continuing operations was
$2,676,000 or $.28 per diluted share in the third quarter of fiscal 2012,
an increase of 13.4% compared to $2,359,000 or $.25 per diluted share for
the same period last year. The $317,000 increase was primarily due to
the $636,000 increase in operating profits offset by higher income taxes.
Discontinued operations - The after tax income from discontinued
operations for the third quarter of fiscal 2012 was $8,000 versus income
of $20,000 for the same period last year. Diluted earnings per share on
discontinued operations for the third quarter of fiscal 2012 and fiscal
2011 was $.00. The discontinued operations results are primarily due to
SunBelt Transport, Inc. risk reserve adjustments.
Net income - Net income for the third quarter of fiscal 2012 was
$2,684,000 compared to $2,379,000 for the same period last year. Diluted
earnings per common share for the third quarter of fiscal 2012 were $.28
compared to $.25 for the same quarter last year. Transportation segment
results were lower due to increased health insurance and workers
compensation claim costs along with higher vehicle repairs, increased
tire prices, and cost of growth initiatives partially offset by increased
gains on equipment sales and incremental profits on increased revenues.
The mining royalty land segment's results were lower due to reduced tons
mined on property owned by the Company partially offset by reduced
allocation of indirect management company costs to this segment. The
Developed property rentals segment's results were higher due to higher
occupancy, lower real estate taxes, maintenance costs and professional
fees partially offset by higher allocation of indirect management company
costs.
Comparative Results of Operations for the Nine months ended June 30,
2012 and 2011
Consolidated Results - Net income for the first nine months of fiscal
2012 was $6,451,000 compared to $10,457,000 for the same period last
year. Diluted earnings per common share for the first nine months of
fiscal 2012 were $.68 compared to $1.11 in the first nine months of
fiscal 2011. Income from continuing operations increased $1,108,000
primarily due to a gain of $1,039,000 on the receipt of non-refundable
deposits related to the termination of an agreement to sell the Company's
Windlass Run Residential property. Income from discontinued operations
favorably impacted net income in fiscal 2011 due to a book gain on the
exchange of property of $4,926,000 after tax or $.52 per diluted share.
Transportation segment results were lower due to increased workers
compensation and health insurance claims along with a rise in fuel costs,
higher vehicle repairs, increased tire prices and cost of growth
initiatives partially offset by higher gains on equipment sales and
incremental profits on increased revenues. The mining royalty land
segment's results were higher due to reduced allocation of indirect
management company costs to this segment. The Developed property rentals
segment's results were higher due to higher occupancy and lower real
estate taxes partially offset by higher maintenance costs and
professional fees.
Transportation Results
Nine months ended June 30
(dollars in thousands) ___2012 % 2011 %_
Transportation revenue $ 63,024 82% 59,315 82%
Fuel surcharges 14,173 18% 12,894 18%
Revenues 77,197 100% 72,209 100%
Compensation and benefits 27,410 36% 25,961 36%
Fuel expenses 18,098 23% 16,383 23%
Insurance and losses 5,771 7% 4,685 6%
Depreciation expense 4,894 6% 4,595 6%
Other, net 8,135 11% 7,172 10%
Sales, general & administrative 6,183 8% 5,810 8%
Allocated corporate expenses ___1,187 2% _1,169 2%
Cost of operations 71,678 93% 65,775 91%
Operating profit $ 5,519 7% 6,434 9%
Transportation segment revenues were $77,197,000 in the first nine months
of fiscal 2012, an increase of $4,988,000 over the same period last year.
Revenue miles in the first nine months of fiscal 2012 were up 2.8%
compared to the first nine months of fiscal 2011 due to business growth
and a slightly longer average haul length. Revenue per mile increased
4.2% over the period last year due to rate increases and higher fuel
surcharges. Fuel surcharge revenue increased $1,279,000 due to higher
fuel costs partially offset by changes to certain customer rates to
incorporate fuel surcharges into base rates. The average price paid per
gallon of diesel fuel increased by $.26 or 7.7% over the same period in
fiscal 2011. There is a time lag between changes in fuel prices and
surcharges and often fuel costs change more rapidly than the market
indexes used to determine fuel surcharges. Excluding fuel surcharges,
revenue per mile increased 3.4% over the same quarter last year.
The Transportation segment's cost of operations was $71,678,000 in the
first nine months of fiscal 2012, an increase of $5,903,000 over the same
period last year. The Transportation segment's cost of operations in the
first nine months of fiscal 2012 as a percentage of revenue was 93%
compared to 91% in the first nine months of fiscal 2011. Compensation
and benefits increased $1,449,000 or 5.6% compared to the same period
last year primarily due to a driver pay increase, the increase in miles
driven and expenses associated with increased driver hiring. Fuel cost
increased by $1,715,000 due to higher cost per gallon. Insurance and
losses increased $1,086,000 compared to the same period last year
primarily due to lower than expected workers compensation and health
insurance claims in the same period last year. Depreciation expense
increased $299,000 due to more trucks in service. Other expense increased
$963,000 due to higher vehicle repair costs, increased tire prices,
increased miles driven, and growth initiatives partially offset by higher
gains on equipment sales. Selling general and administrative costs
increased $373,000 compared to the same period last year due to higher
staffing and professional fees. Allocated corporate expenses increased
$18,000.
Mining Royalty Land Results
Nine months ended June 30
(dollars in thousands) ___2012 % 2011 %_
Mining royalty land revenue $ 3,103 100% 3,193 100%
Property operating expenses 345 11% 370 12%
Depreciation and depletion 86 3% 81 2%
Management Company indirect 1 0% 116 4%
Allocated corporate expense 491 16% 458 14%
Cost of operations 923 30% 1,025 32%
Operating profit $ 2,180 70% 2,168 68%
Mining royalty land segment revenues for the first nine months of fiscal
2012 were $3,103,000, a decrease of $90,000 or 2.8% over the same period
last year, due to a shift in production at two locations reducing the
share of mining on the property owned by the Company partially offset by
new property royalties and higher timber sales.
The mining royalty land segment's cost of operations was $923,000 in the
first nine months of fiscal 2012, a decrease of $102,000 over the same
period last year due primarily to reduced allocation of indirect
management company costs to this segment. Allocated corporate expenses
increased $33,000.
Developed Property Rentals Results
Nine months ended June 30
(dollars in thousands) ___2012 % 2011 %_
Developed property rentals revenue $ 14,415 100% 13,398 100%
Property operating expenses 3,523 25% 4,264 32%
Depreciation and amortization 4,096 28% 3,917 29%
Management Company indirect 1,265 9% 1,045 8%
Allocated corporate expense 736 5% 686 5%
Cost of operations 9,620 67% 9,912 74%
Operating profit $ 4,795 33% 3,486 26%
Developed property rentals segment revenues for the first nine months of
fiscal 2012 were $14,415,000, an increase of $1,017,000 or 7.6% due to
higher occupancy. Occupancy at June 30, 2012 was 87.0% as compared to
82.2% at June 30, 2011.
Developed property segment's cost of operations was $9,620,000 in the
first nine months of fiscal 2012, a decrease of $292,000 or 2.9% over the
same period last year. Property operating expenses decreased $741,000
due to lower real estate taxes and snow removal costs partially offset by
higher maintenance costs and professional fees. Depreciation and
amortization increased $179,000 primarily due to tenant improvements.
Management Company indirect expenses (excluding internal allocations for
lease related property management fees) increased $220,000 due to
increased allocation to this segment and growth initiatives. Allocated
corporate expenses increased $50,000.
Consolidated Results
Operating Profit - Consolidated operating profit was $11,549,000 in the
first nine months of fiscal 2012, an increase of $736,000 or 6.8%
compared to $10,813,000 in the same period last year. Operating profit
in the transportation segment decreased $915,000 or 14.2% primarily due
to increased workers compensation and health insurance claims along with
an increase in fuel costs, higher vehicle repairs, increased tire prices
and cost of growth initiatives partially offset by higher gains on
equipment sales and incremental profits on increased revenues. Operating
profit in the mining royalty land segment increased $12,000 or .6%
primarily due to reduced allocation of indirect management company costs
to this segment. Operating profit in the Developed property rentals
segment increased $1,309,000 or 37.6% due to higher occupancy and lower
real estate taxes partially offset by increased maintenance costs and
professional fees. Consolidated operating profit includes corporate
expenses not allocated to any segment in the amount of $945,000 in the
first nine months of fiscal 2012, a decrease of $330,000 compared to the
same period last year which included an adjustment to the fair value of
the corporate aircraft of $300,000.
Gain on termination of sale contract - The first nine months of fiscal 2012 includes a gain
of $1,039,000 on the receipt of non-refundable deposits related to the
termination of an agreement to sell the Company's Windlass Run Residential
property.
GAIN ON INVESTMENT LAND SOLD - Gain on investment land sold for the first
quarter of fiscal 2013 included a gain on the sale of the developed property
rentals Commonwealth property of $1,116,000 before income taxes. The book value
of the property was $723,000.
Interest income and other (expense) income, net - Interest income and other
(expense) income, net decreased $260,000increased $23,000 over the same periodquarter last year
primarily due to funds received in consideration for the prepaymentconveyance of notes receivable from the sale of SunBelt
Transport.easement
property.
Interest expense - Interest expense decreased $398,000$376,000 over the same periodquarter
last year due to higher capitalized interest and declining mortgage principal
balance. The amount of interest expense andcapitalized on real estate projects under
development was $297,000 higher capitalized interest.
Income taxesthan the same quarter in fiscal 2012 primarily
due to resumed development of Patriot Business Park in April 2012.
INCOME TAXES - Income tax expense increased $813,000$671,000 over the same periodquarter last
year due to higher earnings from continued operations.
Income from continuing operations compared to the same
quarter last year.
INCOME FROM CONTINUING OPERATIONS - Income from continuing operations was
$6,440,000$3,123,000 or $.68$.33 per diluted share in the first nine monthsquarter of fiscal 2012,2013, an
increase of 20.8%47.0% compared to $5,332,000$2,125,000 or $.56$.23 per diluted share for the same
period last year. The $1,108,000$998,000 increase was primarily due to a pretax gain of $1,039,000 on the receipt of non-
refundable deposits related to the termination of an agreement to sell
the Company's Windlass Run Residential property.
Discontinued operations$1,669,000
increase in operating profits offset by higher income taxes.
DISCONTINUED OPERATIONS - The after tax incomeloss from discontinued operations for
the first nine monthsquarter of fiscal 2012 was $11,000 versus
income of $5,125,000 for the same period last year.$1,000. Diluted earnings per share on
discontinued operations for the first nine monthsquarter of fiscal 2013 and fiscal 2012 was
$.00 compared to $.55 in the first nine months of fiscal 2011. The
first nine months of fiscal 2011 included a book gain on the exchange of
property of $4,926,000 after tax or $.52 per diluted share.
Net income$.00.
NET INCOME - Net income for the first nine monthsquarter of fiscal 20122013 was $6,451,000$3,123,000
compared to $10,457,000$2,124,000 for the same period last year. Diluted earnings per
common share for the first nine monthsquarter of fiscal 20122013 were $.68$.33 compared to $1.11 in$.23 for
the first nine months of fiscal 2011.
Income from continuing operations increased $1,108,000 primarily due to
a gain of $1,039,000 on the receipt of non-refundable deposits related to
the termination of an agreement to sell the Company's Windlass Run
Residential property. Income from discontinued operations favorably
impacted net income in fiscal 2011 due to a book gain on the exchange of
property of $4,926,000 after tax or $.52 per diluted share.same quarter last year. Transportation segment results were lowerhigher due to
incremental profits on increased workers
compensation and health insurance claims along with a rise in fuel costs,
higher vehicle repairs, increased tire prices and cost of growth
initiatives partially offset byrevenue, higher gains on equipment sales and
incremental profits onlower than expected health insurance claims partially offset by increased
revenues.vehicle repairs costs, increased site maintenance, and increased sales, general
and administrative expenses. The mining royalty land segment's results were
higher due to reduced allocation of indirect
management company costs to this segment.new property royalties partially offset by increased corporate
expense allocation. The Developed property rentals segment's results were higher
due to higher occupancy and lower real
estate taxesprofessional fees partially offset by higher
maintenance costs and
professional fees.
Liquidity and Capital Resources.health insurance claims allocation.
LIQUIDITY AND CAPITAL RESOURCES. For the first ninethree months of fiscal 2012,2013, the
Company used cash provided by operating activities of continuing operations of
$17,251,000,$3,848,000, proceeds from the sale of plant, property and equipment of
$1,906,000,$2,202,000, proceeds from the exercise of employee stock options of $834,000,$407,000,
excess tax benefits from the exercise of stock options of $452,000,$763,000, and cash
balances to purchase $6,605,000$6,787,000 in transportation equipment, to expend
$7,911,000$4,164,000 in real estate development, to expend $11,039,000 on mining royalty land, to invest $125,000$32,000 in the Brooksville
Joint Venture, to make $3,646,000$1,277,000 scheduled payments on long-term debt and to
repurchase Company stock for $315,000.
Cash provided by the operating activities of discontinued operations was
$10,000.$233,000. Cash decreased $9,188,000.$5,273,000.
Cash flows from operating activities for the first ninethree months of fiscal 20122013
were $708,000$1,522,000 lower than the same period last year primarily due to increased income tax payments.a decrease
in accrued insurance liabilities. Accrued insurance liabilities decreased due to
payments to our new insurer under a captive agreement along with payment in
settlement of three unusually large prior year liability and health claims.
Payments under the captive agreement are for the fiscal 2013 year-to-date loss
fund as estimated in advance using actuarial methodology. The captive agreement
provides that we will share in the underwriting results, good or bad, within a
$250,000 per occurrence layer of loss through retrospective premium adjustments.
Cash flows used in investing activities for the first ninethree months of fiscal
20122013 were $15,110,000$2,402,000 higher reflecting the increased purchase of transportation
equipment for growth and replacement and the purchase of
mining royalty land of $11,039,000real estate development partially
offset by a pretax gain of $1,039,000$1,116,000 on the receiptsale of non-refundable deposits related to the termination of an agreement to sell the Company's Windlass Run
ResidentialCommonwealth property.
Cash flows used in financing activities for the first ninethree months of fiscal
20122013 were $1,021,000$627,000 lower than the same period last year due to lower repurchases of Company stock.
In August 2009higher stock
option exercises.
On December 21, 2012, the Company sold its flatbed trucking company, SunBelt
Transport, Inc. ("SunBelt"entered into a modified credit agreement with
Wells Fargo Bank, N.A. (the "Credit Agreement"). The purchase price received forCredit Agreement modifies
the tractorsCompany's prior Amended and trailers and inventories was a $1 million cash payment and the
delivery of a Promissory Note requiring 60 monthly payments of $130,000
each including 7% interest, secured by the assets of the business
conveyed. As of September 30, 2011 the note receivable was fully paid
and the option to purchase the South Pittsburg facility was completed.
The Company retained all pre-closing receivables and liabilities.
SunBelt has been accounted for as discontinued operations. All periods
presented have been restated accordingly.
In December 2010, a subsidiary of the Company, Florida Rock Properties,
Inc., closed a bargain sale of approximately 1,777 acres of land in
Caroline County, Virginia, to the Commonwealth of Virginia, Board of Game
and Inland Fisheries. The purchase price for the property was
$5,200,000, subject to certain deductions. The Company also donated
$5,599,000 primarily for the value of minerals and aggregates and
recognized a $2,126,000 permanent tax benefit. The $2,126,000 permanent
tax benefit was recorded to income taxes receivable for $303,000 and
offset to long-term deferred tax liabilities of $1,823,000. Actual
realization of the $1,823,000 in deferred taxes will depend on taxable
income, income tax rates, and income tax regulations over the 5 year
carry forward period. The Company's book value of the property was
$276,000. The Caroline County property has been accounted for as a
discontinued operation and all periods presented have been restated
accordingly. The Company used all the proceeds in a 1031 exchange to
purchase Hollander 95 Business Park in a foreclosure sale auction through
a qualified intermediary. Hollander 95 Business Park, in Baltimore City,
Maryland, closed on October 22, 2010 by a 1031 intermediary for a
purchase price totaling $5,750,000. This property consists of an
existing 82,800 square foot warehouse building (33.8% occupied) with an
additional 42 acres of partially developed land with a development
capacity of 490,000 square feet (a mix of warehouse, office, hotel and
flex buildings).
The Company has a $37,000,000 uncollateralizedRestated Revolving Credit Agreement with
three banks, which matures on December 13, 2013.Wachovia Bank, National Association ("Wachovia"), Bank of America, N.A.,
SunTrust Bank, and Compass Bank dated as of November 10, 2004. The RevolverCredit
Agreement is for a 5 year term with a maximum facility amount of $55 million.
The Credit Agreement provides a revolving credit facility (the "Revolver") with
a maximum facility amount of $40 million, with a $20 million sublimit for
standby letters of credit, and a term loan facility of $15 million. The Credit
Agreement contains limitations on availabilitycertain conditions, affirmative financial covenants and
restrictivenegative covenants including limitations on paying cash dividends. Letters of
credit in the amount of $8,953,000$9,009,000 were issued under the Revolver. As of
June 30,December 31, 2012, $28,047,000$45,991,000 was available for borrowing and $55,735,000$58,719,000 of
consolidated retained earnings would be available for payment of dividends. The
Company was in compliance with all covenants as of June 30,December 31, 2012.
The Company had $8,953,000$9,009,000 of irrevocable letters of credit outstanding as of
June 30,December 31, 2012. Most of the letters of credit are irrevocable for a period of
one year and are automatically extended for additional one-year periods until
notice of non-renewal is received from the issuing bank not less than thirty
days before the expiration date. These were issued for insurance retentions and
to guarantee certain obligations to state agencies related to real estate
development. The Company issued replacement letters of credit through the
Revolver to reduce fees.
The Board of Directors has authorized Management to repurchase shares of the
Company's common stock from time to time as opportunities arise. During the
first ninethree months of fiscal 20122013 the Company repurchased 15,9088,700 shares for
$315,000.$233,000. As of June 30,December 31, 2012, $3,915,000$3,682,000 was authorized for future
repurchases of common stock. The Company does not currently pay any cash
dividends on common stock.
The Company has committed to make additional capital contributions of up to
$31,000$130,000 to Brooksville Quarry, LLC in connection with a joint venture with
Vulcan Materials Company.
While the Company is affected by environmental regulations, such regulations are
not expected to have a major effect on the Company's capital expenditures or
operating results.
Summary and Outlook.SUMMARY AND OUTLOOK. Transportation segment miles for this year were 2.8%3.4% higher
than last year. The Company continues to succeed in adding drivers and customers
and anticipates increasing segment miles during fiscal 2012.
In May 2012 the Company acquired approximately 1,200 acres near Orlando,
Florida for a purchase price of $11 million. The Company simultaneously
executed a long-term royalty lease under which it receives a minimum
monthly royalty payment until the tenant receives the necessary permits
and begins mining sand.2013.
Developed property rentals occupancy has increased from 79.8%82.8% to 87.0%86.2% over
last fiscal year endDecember 31, 2011 as the market for new tenants has improved and traffic for
vacant space has increased. Occupancy at June 30,December 31, 2012 and 2011 included
25,660 square feet or .9% and 104,226 square feet or 3.4% and 118,156 square feet or 3.9% respectively for
temporary storage under a less than full market lease rate. The Company has resumed
development of Patriot Business Park effective April 1, 2012 due to two recent
developments. On February 15, 2012, the Company signed an agreement to sell
15.18 acres of land at the site for a purchase price of $4,774,577 which would
result in a profit on the sale if completed. The Company also entered into a
build to suit lease signed April 2, 2012, for a 117,600 square foot building
which is currently under construction.
With cap rates at historically low levels we recently consultedsubstantially completed and occupancy is anticipated during the real
estate brokerage firm of Jones, Lang, LaSalle to explore the market value
of our existing office/warehouse portfolio in the investment community.
We similarly consulted Eastdil Secured for a similar estimate of present
market value. While both valuation estimates were substantially in
excess of book value, the Company has decided not to market the
developed buildings portfolio at this time but to focus on increasing
that value through improved occupancy over the ensuing year.quarter
ending March 31, 2013.
Windlass Run Residential (previously Bird River), located in southeastern
Baltimore County, Maryland, is a 121 acre tract of land adjacent to and
west of our Windlass
Run Business Park. The property was rezoned inIn September 2007 to allow for additional density and plans are being
pursued to obtain an appropriate product mix. In July 2008,2012, the Company entered into an agreementreceived a non-binding letter
of intent to sell the property atfor $18.8 million in two phases. The letter of
intent to sell the property has been converted into 2 executed contracts with a
purchase pricedue diligence period expiring on February 21, 2013. The contracts contemplate
the sale of $25,075,000 and closing was scheduled to occurthe phase 1 of the property in the first quarter of
calendar 2012. The purchaser had placed non-refundable deposits of
$1,000,000 under this contract in escrow. Preliminary approvalending June 30, 2013 for
the
development as originally contemplated was previously received$7.9 million and the timebalance for any appeals from that approval has expired. In October 2011 the
purchaser terminated its agreement to purchase the property and released
the $1,000,000 escrow deposit to the company's subsidiary, FRP Bird
River, LLC. along with all permits, engineering work, plans and other
development work product with regards to the property. The Company
intends to continue to complete the entitlement process for this parcel
of land for residential development and will market it appropriately as
the demand for residential property in this area improves in the future.
In$10.9 million approximately 18 months later.
On March 30, 2012 the Company entered into a Contribution Agreement with MRP SE
Waterfront Residential, LLC. ("MRP") to form a joint venture to develop the
first phase Ionly of the four phase master development known as RiverFront on the
Anacostia in Washington, D.C. The purpose of the Joint Venture is to develop,
own, lease and ultimately sell an approximately 300,000 square foot residential
apartment building (including someapproximately 18,000 square feet of retail) on a
portion of the roughly 5.82 acres of land owned by FRP
adjacent to the Washington Nationals baseball stadium.acre site. The Contribution Agreement provides that
the formation of the Joint Venture will be subject to customary conditions
precedent, including approval of a planned unit development, zoning modification
and extension of the existing PUD to provide for approximately 300,000 square
feet of residential development (including someapproximately 18,000 square feet of
retail) on the Property in lieu of 250,000 square feet of commercial office
space (including some retail) as currently approved for phase 1 of the master
development. If these conditions are satisfied, the parties will enter into a
formal joint venture agreement wherein the Company will contribute the land
comprising phase I to the joint venture in return for approximately a fifty
percent (50%) interest in the venture. MRP will contribute capital of $4,500,000
to the joint venture. MRP will raise any additional equity capital (currently
estimated to be $9,000,000,$11,000,000, subject to revision based on various factors) and
obtain a nonrecourse loan for the balance of the estimated construction and
lease up costs. At this point the Company anticipates commencement of
construction of Phase I in early 2014 with lease up scheduled between late 2015
and all of 2016. On January 14, 2013, the Company received "Final Action" on the
modification and extension to the previously approved planned unit development
from the District of Columbia Zoning Commission. The appeal period on this
action will expire in early March 2013.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS
The Company is exposed to market risk from changes in interest rates. For its
cash and cash equivalents, a change in interest rates affects the amount of
interest income that can be earned. For its debt instruments with variable
interest rates, changes in interest rates affect the amount of interest expense
incurred. The Company prepared a sensitivity analysis of its cash and cash
equivalents to determine the impact of hypothetical changes in interest rates on
the Company's results of operations and cash flows. The interest-rate analysis
assumed a 50 basis point adverse change in interest rates on all cash and cash
equivalents. However, the interest-rate analysis did not consider the effects of
the reduced level of economic activity that could exist in such an environment.
Based on this analysis, management has concluded that a 50 basis point adverse
move in interest rates on the Company's cash and cash equivalents would have an
immaterial impact on the Company's results of operations and cash flows.
ITEM 4. CONTROLS AND PROCEDURES
The Company maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed in the Company's reports under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is
recorded, processed, summarized and reported within the time periods specified
in the SEC's rules and forms, and that such information is accumulated and
communicated to management, including the Company's Chief Executive Officer
("CEO"), Chief Financial Officer ("CFO"), and Chief Accounting Officer ("CAO"),
as appropriate, to allow timely decisions regarding required disclosure.
The Company also maintains a system of internal accounting controls over
financial reporting that are designed to provide reasonable assurance to the
Company's management and Board of Directors regarding the preparation and fair
presentation of published financial statements.
All control systems, no matter how well designed, have inherent limitations.
Therefore, even those systems determined to be effective can provide only
reasonable assurance of achieving the desired control objectives.
As of June 30,December 31, 2012, the Company, under the supervision and with the
participation of the Company's management, including the CEO, CFO and CAO,
carried out an evaluation of the effectiveness of the design and operation of
the Company's disclosure controls and procedures. Based on this evaluation, the
Company's CEO, CFO and CAO concluded that the Company's disclosure controls and
procedures are effective in alerting them in a timely manner to material
information required to be included in periodic SEC filings.
There have been no changes in the Company's internal controls over financial
reporting during the first ninethree months that have materially affected, or are
reasonably likely to materially affect, the Company's internal control over
financial reporting.
PART II. OTHER INFORMATION
ItemITEM 1A. RISK FACTORS
In addition to the other information set forth in this report, you should
carefully consider the factors discussed in Part I, "Item 1A. Risk Factors" in
our Annual Report on Form 10-K for the year ended September 30, 2011,2012, which
could materially affect our business, financial condition or future results. The
risks described in our Annual Report on Form 10-K are not the only risks facing
our Company. Additional risks and uncertainties not currently known to us or
that we currently deem to be immaterial also may materially adversely affect our
business, financial condition and/or operating results.
ItemITEM 2. PURCHASES OF EQUITY SECURITIES BY THE ISSUER
(c)
Total
Number of
Shares (d)
Purchased Approximate
(a) As Part of Dollar Value of
Total (b) Publicly Shares that May
Number of Average Announced Yet Be Purchased
Shares Price Paid Plans or Under the Plans
Period Purchased per Share Programs or Programs (1)
April------ --------- ---------- ---------- ---------------
October 1
through
AprilOctober 31 0 $ - 0 $ 3,915,000
November 1
through
November 30 0 $ - 0 $ 4,093,000
May3,915,000
December 1
through
MayDecember 31 8,7758,700 $ 19.9926.76 0 $ 3,917,000
June 1
through
June 30 1203,682,000
--------- --------
Total 8,700 $ 20.04 0 $ 3,915,000
Total 8,895 $ 19.9926.76 0
(1) In December 2003, the Board of Directors authorized management to expend up
to $6,000,000 to repurchase shares of the Company's common stock from time to
time as opportunities arise. On February 19, 2008, the Board of Directors
authorized management to expend up to an additional $5,000,000 to repurchase
shares of the Company's common stock from time to time as opportunities arise.
ItemITEM 6. EXHIBITS
(a) Exhibits. The response to this item is submitted as a separate Section
entitled "Exhibit Index", on page 32.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
August 1, 2012February 6, 2013 PATRIOT TRANSPORTATION HOLDING, INC.
Thompson S. Baker II
Thompson S. Baker II
President and Chief Executive
Officer
John D. Milton, Jr. John D. Milton, Jr.
Executive Vice President, Treasurer,
Secretary and Chief Financial Officer
John D. Klopfenstein
John D. Klopfenstein
Controller and Chief
Accounting Officer
PATRIOT TRANSPORTATION HOLDING, INC.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30,DECEMBER 31, 2012
EXHIBIT INDEX
(10)(h) Amended and Restated Credit Agreement dated December 21,
2012 between Patriot Transportation Holding, Inc. as Borrower
and Wells Fargo Bank, N.A. as lender. Filed herein.
(10)(r) Joint Venture Agreement between Florida Rock Properties, Inc.
and MRP SE Waterfront Residential, Inc., incorporated by
reference to an exhibit filed with Form 10-Q for the
quarter ended March 31, 2012. File No. 000-17554.
(14) Financial Code of Ethical Conduct between the Company, Chief
Executive Officers and Financial Managers, as revised on January
28, 2004, which is available on the Company's website at
www.patriottrans.com.
(31)(a) Certification of Thompson S. Baker II.
(31)(b) Certification of John D. Milton, Jr.
(31)(c) Certification of John D. Klopfenstein.
(32) Certification of Chief Executive Officer, Chief Financial
Officer, and Chief Accounting Officer under Section 906 of the
Sarbanes-Oxley Act of 2002.
101.INS XBRL Instance Document
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101.DEF XBRL Taxonomy Extension Definition Linkbase
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