Rand Logistics, Inc.
RAND LOGISTICS REPORTS THIRD QUARTER FISCAL YEAR 2015 FINANCIAL RESULTS
Operating Income plus Depreciation, Amortization, Loss on Foreign Exchange and Lease Termination Expense Increased 15.2% to $15.1 million; up 20.7% on a Constant Currency Basis
New York, NY – February 4, 2015 - Rand Logistics, Inc. (NASDAQ: RLOG) (“Rand”) today announced its financial results for the fiscal year 2015 third quarter ended December 31, 2014.
Quarter Ended December 31, 2014 Versus
Quarter Ended December 31, 2013 Financial Results
| Freight and related revenue (which excludes fuel and other surcharges) increased by 5.3% to $42.0 million from $39.9 million. This increase was primarily attributable to an increase in tonnage carried, price increases, improvements in commodity mix and water levels and a higher percentage of time in revenue loaded condition, offset by a weaker Canadian dollar. On a constant currency basis, freight and related revenue increased by 9.9% or $4.0 million. |
| · | Freight and related revenue per Sailing Day increased by 6.0%, or $1,733, to $30,834 from $29,101. On a constant currency basis, freight and other related revenue per Sailing Day increased by 10.6% or $3,095. |
| · | Total revenue decreased by 1.7% to $49.1 million from $49.9 million. |
| · | Vessel operating expenses decreased by 8.9% to $29.8 million compared to $32.7 million. This decrease was primarily due to improvements in certain of our operating metrics, a reduction in fuel expenses and the weaker Canadian dollar. Vessel operating expenses per Sailing Day decreased by 8.3% to $21,929 from $23,901. On a constant currency basis, vessel operating expenses per Sailing Day decreased 4.0% or $961. |
| · | The Company exercised its right to terminate the Bareboat Charter Agreement related to the McKee Sons barge. In conjunction with exercising this right, the Company recorded a $2.7 million loss on the termination of the agreement, including the write-off of $1.5 million of vessel leasehold improvements. |
| · | Operating income plus depreciation, amortization, loss on foreign exchange, and lease termination expense was $15.1 million, an increase of 15.2%, or $2.0 million, from $13.1 million. On a constant currency basis, this measure increased by 20.7% or $2.7 million. |
Nine Months Ended December 31, 2014 Versus Nine Months Ended December 31, 2013 Financial Results
| · | Total Sailing Days were 3,850 compared to 3,918 in the prior year and a theoretical maximum of 4,125. The year-over-year decline was primarily due to adverse weather conditions on the Great Lakes that caused the loss of 195 Sailing Days at the start of the 2014 sailing season. |
| · | Freight and related revenue (which excludes fuel and other surcharges) increased by 1.8% to $124.7 million. On a constant currency basis, freight and related revenue increased by 5.3% or $6.5 million. |
| · | Freight and related revenue per Sailing Day increased by 3.6% to $32,384 compared to $31,248. On a constant currency basis, freight and related revenue per Sailing Day increased 7.2% or $2,248. |
| · | Total revenue declined by 1.5% to $146.6 million from $148.8 million. |
| · | Vessel operating expenses decreased by 5.7% to $91.5 million from $97.0 million. This decrease was primarily due to improvements in certain of our operating metrics, fewer Sailing Days, a reduction in fuel expenses and a weaker Canadian dollar, partially offset by increased costs due to inefficient operations at the start of the 2014 sailing season. Vessel operating expenses per Sailing Day declined by 4.1%, or $1,004, to $23,762 from $24,766. On a constant currency basis, vessel operating expenses per Sailing Day decreased by 0.5% or $132. |
| · | Operating income plus depreciation, amortization, loss on foreign exchange, and lease termination expense increased by 7.1%, or $2.9 million, to $43.6 million from $40.7 million. On a constant currency basis, this measure increased by 10.8% or $4.4 million. |
| · | Net income per share on a fully diluted basis increased to $0.60 from $0.16 in the year ago period. |
Rand Logistics Third Quarter Fiscal 2015 Financial Results
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Management Comments
“Our operating performance in the third quarter continued to benefit from broadening strength for the commodities that we carry, an improved commodity mix, a 39 day reduction in Delay Days, more efficient trade patterns and the movement of more cargo per trip due to higher water levels,” commented Ed Levy, President and CEO of Rand. “We operated our fleet at a 98.6% utilization rate in the quarter and vessel margin per Sailing Day, excluding the impact of currency change, increased by 22.1%. On that same constant currency basis, our year-to-date vessel margin per Sailing Day is up 12.8%.”
Mr. Levy continued, “Our success in rebalancing our commodity mix for the 2014 sailing season and the continued improvement in our key operating and reliability metrics have positively impacted our percentage of time in revenue loaded condition. However, the benefit on our year-to-date profitability has been tempered by $1.5 million due to the weaker Canadian dollar as well as adverse weather conditions in April through mid-May of this sailing season. As previously disclosed, as a result of these weather conditions, our operating income plus depreciation, amortization and loss on foreign currency was $3.0 million less in April 2014 than in April 2013.”
Conference Call
Management will host a conference call to discuss these results at 8:30 a.m. EST on Thursday, February 5, 2015. Interested parties may participate in the conference call by dialing 888-430-8705 (719-325-2452 for international callers), and using Conference ID# 1275016. The conference call will be webcast simultaneously on the Rand Logistics, Inc. website at www.randlogisticsinc.com/presentations.html.
A replay of the conference call will be available at www.randlogisticsinc.com/presentations.html and will be archived for 12 months. A replay will also be available until June 5, 2015 by dialing 877-870-5176 (858-384-5517 for international callers), and using Conference ID# 1275016.
Non-GAAP Financial Measures/Financial Tables
This press release contains certain non-GAAP financial measures. Reconciliations of these and other non-GAAP measures to the comparable GAAP measures are included in the attached financial tables.
About Rand Logistics
Rand Logistics, Inc. is a leading provider of bulk freight shipping services throughout the Great Lakes region. Through its subsidiaries, the Company operates a fleet of four conventional bulk carriers and eleven self-unloading bulk carriers including three tug/barge units. The Company is the only carrier able to offer significant domestic port-to-port services in both Canada and the U.S. on the Great Lakes. The Company's vessels operate under the U.S. Jones Act – which reserves domestic waterborne commerce to vessels that are U.S. owned, built and crewed, – and the Canada Coasting Trade Act – which reserves domestic waterborne commerce to Canadian registered and crewed vessels that operate between Canadian ports.
Forward-Looking Statements
This press release contains forward-looking statements. For all forward-looking statements, we claim the protection of the Safe Harbor for Forward-Looking Statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy or are otherwise beyond our control and some of which might not even be anticipated. Future events and actual results, affecting our strategic plan as well as our financial position, results of operations and cash flows, could differ materially from those described in or contemplated by the forward-looking statements. Important factors that contribute to such risks include, but are not limited to, the effect of an economic downturn in certain of our markets; the weather conditions on the Great Lakes; and our ability to maintain and replace our vessels as they age. 