EXHIBIT 99.1
Transport Corporation of America, Inc.
1715 Yankee Doodle Road
Eagan, MN 55121
Traded: Nasdaq: TCAM
| COMPANY CONTACTS: | | | |
| Michael Paxton | | Keith Klein | |
| Chairman, President and CEO | | Chief Financial Officer | |
| (651) 686-2500 | | (651) 686-2500 | |
FOR IMMEDIATE RELEASE
Tuesday, February 8, 2005
TRANSPORT CORPORATION OF AMERICA
REPORTS FOURTH QUARTER RESULTS
MINNEAPOLIS, MINNESOTA, February 8, 2005 – Transport Corporation of America, Inc. (NASDAQ: TCAM), today announced revenues for the fourth quarter 2004 of $65.3 million, compared with 2003 fourth quarter revenues of $62.1 million. Fourth quarter 2004 net income was $1.1 million or $0.17 per diluted share, compared with fourth quarter 2003 net income of $322,000, or $0.04 per diluted share. Results in the fourth quarter 2003 include a non-cash benefit of $164,000 after taxes, or $0.02 per diluted share, for a change in estimate related to the impairment of revenue equipment.
Michael Paxton, Chairman, President and Chief Executive Officer, commented, “We are pleased to report improved year-over-year operating results. We continue to focus on our network density and balance resulting in increased productivity and reduced costs. Our operating ratio improved from 97.7 in the fourth quarter of 2003 to 96.0 in the fourth quarter of 2004. Our revenue per loaded mile (excluding fuel surcharges) improved during the quarter by 2.3 percent sequentially from third quarter and 6.3 percent on a year-over-year basis. Freight revenue per tractor per week (excluding fuel surcharges) increased to $2,924 in the fourth quarter 2004 compared to $2,852 for the same period 2003.” (The financial tables at the end of this release reconcile the differences between these non-GAAP financial measures excluding fuel surcharges and the most directly comparable GAAP measures including fuel surcharges.)
Full Year Results
For the year ended December 31, 2004, Transport America announced revenues of $258.4 million, compared with 2003 revenues of $258.9 million. Net income before cumulative effect of a change in accounting principle for the year was $2.0 million, or $0.30 per diluted share, compared with a 2003 net income before cumulative effect of a change in accounting principle of $74,000, or $0.01 per diluted share.
Results in 2003 included a non-cash benefit of $0.3 million after taxes, or $0.05 per share, for changes in estimates related to the impairment of revenue equipment and a gain of $0.8 million after taxes, or $0.11 per share, relating to the sale of its Clarksville maintenance facility.
Net income for the year ended December 31, 2004 was $2.0 million, or $0.30 per share, compared to a net loss of $1.1 million, or $0.15 per share, in 2003. Results in 2003 include a non-cash charge of $1.1 million after taxes, or $0.15 per share, for a change in accounting principle relating to its corporate office building and a non-cash charge of $0.1 million after taxes, or $0.01 per share, for a change in accounting principle relating to environmental disposal costs on tires.
Review of 2004
Reflecting on the past year, Paxton noted, “We benefited from the strong economy in 2004. High demand for freight services, combined with limited capacity, has allowed the industry to obtain rate increases with the majority of customers on most lanes of traffic. On the other side of the coin, the industry continues to face cost pressure; driver pay rates are increasing at unprecedented levels as the industry tries to attract and retain drivers; insurance and accident costs continue to rise, medical and workers compensation costs continue to increase, fuel costs are at historical highs, and taxing authorities continue to raise tax levies and toll rates.”
“New hours of service rules were also enacted by the federal government in 2004 that regulate the amount of time a driver can work. We were very proactive in addressing these changes in order to offset inefficiencies in our customers’ supply chain networks. We adopted new accessorial charges for customer events that decrease asset productivity in order to protect our drivers and ensure that they are being appropriately compensated for their time.”
“Transport America continued to achieve important strides in administrative productivity in 2004. For 2004, our revenue per non-driver employee had increased to $642,000 compared to $628,000 in 2003.”
“Finally, we continued to strengthen our balance sheet by exceeding our debt reduction plan and improving asset utilization. Total debt as of December 31, 2004 was $49.1 million, compared to $54.9 million at December 31, 2003. During the year, we also repurchased 626,000 shares of our common stock at a cost of $4.5 million. Overall, we are pleased with the continued progress we made in 2004, and are committed to driving continued improvement as we move forward.”
Outlook
Looking ahead, Paxton commented, “We expect demand to remain relatively strong in 2005 and truckload capacity to remain tight. The tight driver market will continue to be the industry’s biggest challenge. We have implemented new programs to boost our recruiting results and increase our seated fleet percentage. We have also announced increased driver pay packages and rolled out new programs to improve retention of our existing drivers.”
The Company will host a conference call and webcast on Tuesday, February 8, 2005 at 10:00 a.m. Central Time. The Internet broadcast can be accessed at the Company’s website,www.transportamerica.com, or atwww.fulldisclosure.com.
About Transport America
Transport Corporation of America, Inc., based in the Minneapolis — St. Paul metropolitan area, provides a wide range of truckload freight carriage and logistics services to customers in the United States and Canada. Transport America focuses on providing time-definite and other responsive
services through its team of dedicated and committed employees supported by state-of-the-art technology and information systems.
This news release contains forward-looking statements regarding the Company. The Company wishes to caution readers not to place undue reliance on any forward-looking statements which speak only as of the date made. The following important factors, among other things, in some cases have affected and in the future could affect the Company’s actual results and could cause the Company’s actual financial performance to differ materially from that expressed in any forward-looking statement: (1) the highly competitive conditions that currently exist in the Company’s market and the Company’s ability to compete, (2) the Company’s ability to recruit, train, and retain qualified drivers, (3) increases in fuel prices, and the Company’s ability to recover these costs from its customers, (4) the impact of environmental standards and regulations on new revenue equipment, (5)changes in governmental regulations applicable to the Company’s operations, (6) adverse weather conditions, (7) accidents, (8) the financing and resale market for used revenue equipment, (9) changes in interest rates, (10) cost of liability insurance coverage, and (11) downturns in general economic conditions affecting the Company and its customers. The foregoing list should not be construed as exhaustive and the Company disclaims any obligation subsequently to revise or update any previously made forward-looking statements. Unanticipated events are likely to occur.
Financial Tables to Follow...
TRANSPORT CORPORATION OF AMERICA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and Twelve Months ended December 31, 2004 and 2003
(In thousands, except share and per share amounts)
| Three Months
(Unaudited)
| | Year To Date
(Unaudited)
|
|---|
| 2004
| | 2003
| | 2004
| | 2003
|
|---|
| Amount
| | %
| | Amount
| | %
| | Amount
| | %
| | Amount
| | %
|
|---|
| Operating revenues | | | $ | 65,303 | | | 100.0 | | $ | 62,051 | | | 100.0 | | $ | 258,408 | | | 100.0 | | $ | 258,859 | | | 100.0 | |
| |
| Operating expenses: | | |
| Salaries, wages, and benefits | | | | 18,764 | | | 28.7 | | | 17,115 | | | 27.6 | | | 76,129 | | | 29.5 | | | 71,080 | | | 27.5 | |
| Fuel, maintenance, and other expense | | | | 11,904 | | | 18.2 | | | 8,876 | | | 14.3 | | | 42,909 | | | 16.6 | | | 38,933 | | | 15.0 | |
| Purchased transportation | | | | 18,822 | | | 28.8 | | | 21,064 | | | 33.9 | | | 79,144 | | | 30.6 | | | 91,516 | | | 35.4 | |
| Revenue equipment leases | | | | 374 | | | 0.6 | | | 272 | | | 0.4 | | | 1,266 | | | 0.5 | | | 1,069 | | | 0.4 | |
| Depreciation and amortization | | | | 6,064 | | | 9.3 | | | 6,137 | | | 9.9 | | | 23,757 | | | 9.2 | | | 25,104 | | | 9.7 | |
| Insurance, claims, and damage | | | | 2,672 | | | 4.1 | | | 3,460 | | | 5.6 | | | 12,496 | | | 4.8 | | | 12,287 | | | 4.7 | |
| Taxes and licenses | | | | 1,213 | | | 1.9 | | | 1,123 | | | 1.8 | | | 4,604 | | | 1.8 | | | 4,556 | | | 1.8 | |
| Communication | | | | 449 | | | 0.7 | | | 533 | | | 0.9 | | | 1,788 | | | 0.7 | | | 2,194 | | | 0.8 | |
| Other general and administrative expenses | | | | 2,409 | | | 3.7 | | | 2,270 | | | 3.7 | | | 9,634 | | | 3.7 | | | 9,611 | | | 3.7 | |
| Impairment of revenue equipment | | | | 0 | | | 0.0 | | | (271 | ) | | (0.4 | ) | | 0 | | | 0.0 | | | (549 | ) | | (0.2 | ) |
| Impairment of sublease office space | | | | 0 | | | 0.0 | | | 0 | | | 0.0 | | | 190 | | | 0.1 | | | 0 | | | 0.0 | |
| Loss (Gain) on disposition of property and equipment | | | | 47 | | | 0.1 | | | 15 | | | 0.0 | | | 25 | | | 0.0 | | | (1,302 | ) | | (0.5 | ) |
|
| |
| |
| |
| |
| |
| |
| |
| |
| Total operating expenses | | | | 62,718 | | | 96.0 | | | 60,594 | | | 97.7 | | | 251,942 | | | 97.5 | | | 254,499 | | | 98.3 | |
|
| |
| |
| |
| |
| |
| |
| |
| |
| |
| Operating income | | | | 2,585 | | | 4.0 | | | 1,457 | | | 2.3 | | | 6,466 | | | 2.5 | | | 4,360 | | | 1.7 | |
| |
| Interest expense, net | | | | 708 | | | 1.1 | | | 924 | | | 1.5 | | | 3,115 | | | 1.2 | | | 4,123 | | | 1.6 | |
|
| |
| |
| |
| |
| |
| |
| |
| |
| Earnings before income taxes | | | | 1,877 | | | 2.9 | | | 533 | | | 0.9 | | | 3,351 | | | 1.3 | | | 237 | | | 0.1 | |
| |
| Income tax provision | | | | 741 | | | 1.1 | | | 211 | | | 0.3 | | | 1,314 | | | 0.5 | | | 163 | | | 0.1 | |
|
| |
| |
| |
| |
| |
| |
| |
| |
| Earnings before cumulative effect of |
| changes in accounting principle | | | | 1,136 | | | 1.7 | | | 322 | | | 0.5 | | | 2,037 | | | 0.8 | | | 74 | | | 0.0 | |
| |
| Cumulative effect of changes in accounting | | |
| principle, net of tax effect | | | | 0 | | | 0.0 | | | 0 | | | 0.0 | | | 0 | | | 0.0 | | | (1,153 | ) | | (0.4 | ) |
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| |
| |
| |
| |
| |
| |
| |
| |
| Net earnings (loss) | | | $ | 1,136 | | | 1.7 | | $ | 322 | | | 0.5 | | $ | 2,037 | | | 0.8 | | $ | (1,079 | ) | | (0.4 | ) |
|
| |
| |
| |
| |
| |
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| |
| |
| |
| Earnings (loss) per common share – basic | | |
| Before cumulative effect of changes | | |
| in accounting principle | | | $ | 0.17 | | | | | $ | 0.05 | | | | | $ | 0.30 | | | | | $ | 0.01 | | | | |
| Net earnings (loss) per share | | | $ | 0.17 | | | | | $ | 0.05 | | | | | $ | 0.30 | | | | | $ | (0.15 | ) | | | |
| |
| Earnings (loss) per common share – diluted | | |
| Before cumulative effect of changes | | |
| in accounting principle | | | $ | 0.17 | | | | | $ | 0.04 | | | | | $ | 0.30 | | | | | $ | 0.01 | | | | |
| Net earnings (loss) per share | | | $ | 0.17 | | | | | $ | 0.04 | | | | | $ | 0.30 | | | | | $ | (0.15 | ) | | | |
| |
| Average common shares outstanding | | |
| Basic | | | | 6,525,692 | | | | | | 7,141,730 | | | | | | 6,722,157 | | | | | | 7,171,368 | | | | |
| Diluted | | | | 6,665,496 | | | | | | 7,233,431 | | | | | | 6,841,195 | | | | | | 7,203,690 | | | | |
TRANSPORT CORPORATION OF AMERICA, INC.
BALANCE SHEET
December 31, 2004 and 2003
(In Thousands)
Unaudited
ASSETS
| 2004
| | 2003
|
|---|
| Current Assets: | | | | | | | | |
| Cash and cash equivalents | | | $ | 3,714 | | $ | 2,345 | |
| Trade receivables, net of allowances | | | | 24,610 | | | 24,978 | |
| Other receivables | | | | 1,170 | | | 1,200 | |
| Operating supplies | | | | 800 | | | 813 | |
| Deferred income taxes | | | | 6,316 | | | 6,452 | |
| Prepaid expenses | | | | 2,626 | | | 2,894 | |
|
| |
| |
| Total Current Assets | | | | 39,236 | | | 38,682 | |
| |
| Revenue Equipment, At Cost | | | | 180,827 | | | 180,970 | |
| Less: accumulated depreciation | | | | (80,077 | ) | | (77,435 | ) |
|
| |
| |
| Revenue Equipment, Net | | | | 100,750 | | | 103,535 | |
| |
| Property and Other Equipment: | | |
| Land, buildings, and improvements | | | | 16,516 | | | 16,237 | |
| Other equipment and leasehold improvements | | | | 21,219 | | | 21,436 | |
| Less: accumulated depreciation | | | | (18,699 | ) | | (16,667 | ) |
|
| |
| |
| Property and Other Equipment, Net | | | | 19,036 | | | 21,006 | |
|
| |
| |
| |
| Revenue, Property and Other Equipment, Net | | | | 119,786 | | | 124,541 | |
| |
| Other Assets, Net | | | | 2,056 | | | 2,045 | |
|
| |
| |
| Total Assets | | | $ | 161,078 | | $ | 165,268 | |
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| |
| |
| |
| LIABILITIES AND STOCKHOLDERS’ EQUITY |
| |
| 2004
| | 2003
|
|---|
| Current Liabilities: | | |
| Current maturities of Long Term Debt | | | $ | 7,965 | | $ | 8,843 | |
| Current maturities of Capital Lease Obligations | | | | 9,990 | | | 4,328 | |
| Accounts payable | | | | 5,026 | | | 3,526 | |
| Checks issued in excess of cash balances | | | | 1,871 | | | 1,066 | |
| Due to independent contractors | | | | 1,157 | | | 1,545 | |
| Accrued expenses | | | | 21,132 | | | 19,407 | |
|
| |
| |
| Total Current Liabilities | | | | 47,141 | | | 38,715 | |
| |
| Long-Term Debt & Capital Lease Obligations | | |
| Long-term debt less current maturities | | | | 28,336 | | | 28,929 | |
| Capital lease obligations less current maturities | | | | 2,826 | | | 12,820 | |
|
| |
| |
| Total Long-Term Debt | | |
| & Capital Lease Obligations | | | | 31,162 | | | 41,749 | |
| |
| Deferred Income Taxes | | | | 26,504 | | | 26,103 | |
| |
| Shareholders’ Equity: | | |
| Common stock | | | | 65 | | | 71 | |
| Additional paid-in capital | | | | 25,428 | | | 29,889 | |
| Retained earnings | | | | 30,778 | | | 28,741 | |
|
| |
| |
| Total Shareholders’ Equity | | | | 56,271 | | | 58,701 | |
| |
|
| |
| |
| Total Liabilities and Equity | | | $ | 161,078 | | $ | 165,268 | |
|
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| |
TRANSPORT CORPORATION OF AMERICA, INC.
Selected Consolidated Financial and Operating Data
Three and Twelve Months Ended December 31, 2004 and 2003
| Three Months
| | Twelve Months
|
|---|
| 2004
| | 2003
| | 2004
| | 2003
|
|---|
| Operating Statistics | | | | | | | | | | | | | | |
| Company tractors, seated | | | | 860 | | | 822 | | | 860 | | | 822 | |
| Company tractors, other | | | | 143 | | | 178 | | | 143 | | | 178 | |
| Independent contractor | | | | 551 | | | 713 | | | 551 | | | 713 | |
|
| |
| |
| |
| |
| Total tractors (at end of period) | | | | 1,554 | | | 1,713 | | | 1,554 | | | 1,713 | |
| Trailers (at end of period) | | | | 4,897 | | | 4,980 | | | 4,897 | | | 4,980 | |
| |
| Average company tractors in service | | | | 1,551 | | | 1,668 | | | 1,607 | | | 1,778 | |
| Total loaded miles (000’s) | | | | 36,721 | | | 40,936 | | | 157,342 | | | 173,872 | |
| Total miles (000’s) | | | | 41,441 | | | 45,544 | | | 176,722 | | | 193,772 | |
| |
| Freight revenue per tractor per week* | | | $ | 2,924 | | $ | 2,852 | | $ | 2,880 | | $ | 2,726 | |
| Fuel surcharge per tractor per week | | | $ | 350 | | $ | 112 | | $ | 226 | | $ | 120 | |
|
| |
| |
| |
| |
| Operating revenue per tractor per week | | | $ | 3,274 | | $ | 2,964 | | $ | 3,106 | | $ | 2,846 | |
|
| |
| |
| |
| |
| |
| Freight revenues per loaded mile* | | | $ | 1.532 | | $ | 1.441 | | $ | 1.494 | | $ | 1.410 | |
| Fuel surcharge per loaded mile | | | $ | 0.183 | | $ | 0.057 | | $ | 0.118 | | $ | 0.063 | |
|
| |
| |
| |
| |
| Operating revenues per loaded mile | | | $ | 1.715 | | $ | 1.498 | | $ | 1.612 | | $ | 1.473 | |
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| |
| |
| |
| |
| |
| Freight revenues per mile* | | | $ | 1.357 | | $ | 1.295 | | $ | 1.330 | | $ | 1.266 | |
| Fuel surcharge per mile | | | $ | 0.162 | | $ | 0.051 | | $ | 0.105 | | $ | 0.055 | |
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| |
| |
| |
| |
| Operating revenues per mile | | | $ | 1.519 | | $ | 1.346 | | $ | 1.435 | | $ | 1.321 | |
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| Average empty mile percentage | | | | 11.4 | % | | 10.1 | % | | 11.0 | % | | 10.3 | % |
| Average length of haul, all miles | | | | 664 | | | 697 | | | 682 | | | 718 | |
| Average annual revenues per non- | | |
| driver employee (000’s) | | | $ | 659 | | $ | 607 | | $ | 642 | | $ | 628 | |
| |
| Financial Data (000’s) | | |
| Freight revenue (excluding fuel surcharge) | | | $ | 56,251 | | $ | 58,980 | | $ | 235,095 | | $ | 245,240 | |
| Fuel surcharge revenue | | | | 6,718 | | | 2,329 | | | 18,485 | | | 10,796 | |
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| |
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| |
| |
| Operating revenue (including fuel surcharge) | | | $ | 62,969 | | $ | 61,309 | | $ | 253,580 | | $ | 256,036 | |
| Logistics and other revenue | | | | 2,334 | | | 742 | | | 4,828 | | | 2,823 | |
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| |
| Total revenue | | | $ | 65,303 | | $ | 62,051 | | $ | 258,408 | | $ | 258,859 | |
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| Capital expenditures, net of proceeds | | | $ | 5,377 | | $ | 4,064 | | $ | 19,027 | | $ | 11,016 | |
| Total debt and capital lease obligations | | | $ | 49,117 | | $ | 54,919 | | $ | 49,117 | | $ | 54,919 | |
| |
| * Excluding fuel surcharge | | |
