Exhibit 99
 | 9503 East 33rd Street Indianapolis, IN 46235-4207 (800) CELADON (317) 972-7000 |
For more information: | FOR IMMEDIATE RELEASE |
| Craig M. Koven | August 4, 2008 |
| Communications Manager | |
| (800) CELADON Ext. 7041 | |
| (317) 972-7041 Direct | |
| (317) 408-4859 Mobile | |
| ckoven@celadongroup.com | |
CELADON GROUP REPORTS JUNE QUARTER AND FULL FISCAL YEAR RESULTS
INDIANAPOLIS – Celadon Group Inc. (Nasdaq: CLDN) today reported its financial and operating results for the three months and fiscal year ended June 30, 2008, the fourth fiscal quarter of the company’s fiscal year ending June 30, 2008.
For the quarter, revenue increased 17.4% to $154.6 million in the 2008 quarter from $131.7 million in the 2007 quarter. Freight revenue, which excludes fuel surcharges, was up 3.5% to $116.7 million in the 2008 quarter from $112.7 million in the 2007 quarter. Pre-tax income decreased to $4.4 million in the 2008 quarter from $8.3 million for the same quarter last year. Earnings per diluted share decreased to $0.10 in the 2008 quarter from $0.22 for the same quarter last year.
For the fiscal year ended June 30, 2008, revenue increased 12.6% to $565.9 million in 2008 from $502.7 million for the same period last year. Freight revenue was up 5.7% to $457.5 million in 2008 from $433.0 million for the same period last year. Net income decreased 70.4% to $6.6 million in 2008 from $22.3 million for the same period last year. Earnings per diluted share decreased to $0.29 from $0.94 the same period last year.
Chairman and CEO Steve Russell commented, "The June quarter results showed marked improvement in operating metrics. Average miles per week per tractor was the best since December 2006, and up about two percent from June 2007. Deadhead miles, at 9.7 percent of total miles, compared to 10.5 percent in the June 2007 quarter, and was the lowest since the September 2006 quarter. Although down by 2.1 cents from the comparable quarter last year, the average rate per loaded mile increased from the March 2007 quarter by close to one cent per mile. Revenue per tractor per week was the highest since the December 2006 quarter.
"We are clearly seeing the results of a meaningful reduction in capacity in the truckload industry. The shrinking of capacity is the result of a substantial number of fleet failures, reductions in the number of trucks run by many larger fleets, and the export of relatively young Class 8 tractors to eastern Europe and elsewhere, and fewer new tractors being built. Although overall freight demand is perhaps up slightly, the impact of the reduction in supply
has led to a firming of rates and volumes per available truck. Unless there is a meaningful decline in freight demand, we expect rate increase opportunities will continue.
“Our balance sheet remains solid and we retain significant liquidity to support the growth of our business. At June 30, 2008, we had $143.9 million of stockholders' equity and $102.5 million of total borrowing. Since June 30, 2007, borrowing increased only $7.8 million despite the purchase of 420 new tractors and repurchase of approximately two million shares of our stock.”
Conference Call Information
An investor conference call is scheduled for Tuesday, August 5, at 10:00 a.m. EDT. Steve Russell and other members of management will discuss the results of the quarter. To listen and participate in a questions-and-answers exchange, simply dial 866-383-8008 (international calls 617-597-3341) pin number 59904049 a few minutes prior to the start time. A replay will be available through October 5 by dialing 888-286-8010 (international calls 617-801-6888) and entering call back code 37096380.
This call is being Web cast by Thomson/CCBN and can be accessed via Celadon's Web site at www.celadongroup.com.
Celadon Group Inc. (www.celadongroup.com), through its subsidiaries, primarily provides long-haul, full-truckload freight service across the United States, Canada and Mexico. The company also owns TruckersB2B Inc. (www.truckersb2b.com) which provides cost savings to member fleets; Celadon Dedicated Services, which provides supply chain management solutions, such as warehousing and dedicated fleet services; and Celadon Brokerage Services.
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements may be identified by their use of terms or phrases such as "expects," "estimates," "projects," "believes," "anticipates," "plans," "intends," and similar terms and phrases. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Actual results may differ from those set forth in the forward-looking statements. The following factors, among others, could cause actual results to differ materially from those in forward-looking statements: the risk that our perception of additional capacity due to seating trucks and perceived benefits thereof are inaccurate; the risk that our perception of changes in our customer base and perceived benefits thereto are inaccurate; the risk that managing our tractor fleet age does not result in greater flexibility and lower operating expenses; excess tractor and trailer capacity in the trucking industry; decreased demand for our services or loss of one or more of our major customers; surplus inventories; recessionary economic cycles and downturns in customers' business cycles; strikes, work slow downs, or work stoppages at our facilities, or at customer, port, border crossing, or other shipping related facilities; increases in compensation for and difficulty in attracting and retaining qualified drivers and independent contractors; increases in insurance premiums and deductible amounts; elevated experience in the frequency or severity of claims relating to accident, cargo, workers' compensation, health, and other matters; fluctuations in claims expenses that result from high self-insured
retention amounts and differences between estimates used in establishing and adjusting claims reserves and actual results over time; increases or rapid fluctuations in fuel prices, as well as fluctuations in hedging activities and surcharge collection, the volume and terms of diesel purchase commitment, interest rates, fuel taxes, tolls, and license and registration fees; fluctuations in foreign currency exchange rates; increases in the prices paid for new revenue equipment and changes in the resale value of our used equipment; increases in interest rates or decreased availability of capital or other sources of financing for revenue equipment; seasonal factors such as harsh weather conditions that increase operating costs; competition from trucking, rail, and intermodal competitors; regulatory requirements that increase costs or decrease efficiency, including revised hours-of-service requirements for drivers and new emissions control regulations; our ability to identify acceptable acquisition candidates, consummate acquisitions, and integrate acquired operations; the timing of, and any rules relating to, the opening of the border to Mexican drivers; challenges associated with doing business internationally; our ability to retain key employees; and the effects of actual or threatened military action or terrorist attacks or responses, including security measures that may impede shipping efficiency, especially at border crossings.
Readers should review and consider these factors along with the various disclosures by the company in its press releases, stockholder reports, and filings with the Securities Exchange Commission. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.
- tables follow -
CELADON GROUP, INC.
CONSOLIDATED BALANCE SHEETS
June 30, 2008 and 2007
(Dollars in thousands)
| ASSETS | | 2008 | | | 2007 | |
| | | | | | | |
| Current assets: | | | | | | |
Cash and cash equivalents | | $ | 2,325 | | | $ | 1,190 | |
Trade receivables, net of allowance for doubtful accounts of $1,194 and $1,176 in 2008 and 2007, respectively | | | 69,513 | | | | 59,387 | |
Prepaid expenses and other current assets | | | 16,697 | | | | 10,616 | |
Tires in service | | | 3,765 | | | | 3,012 | |
Equipment held for resale | | | --- | | | | 11,154 | |
Income tax receivable | | | 5,846 | | | | 1,526 | |
Deferred income taxes | | | 3,035 | | | | 2,021 | |
| Total current assets | | | 101,181 | | | | 88,906 | |
| Property and equipment | | | 270,832 | | | | 240,898 | |
| Less accumulated depreciation and amortization | | | 64,633 | | | | 44,553 | |
| Net property and equipment | | | 206,199 | | | | 196,345 | |
| Tires in service | | | 1,483 | | | | 1,449 | |
| Goodwill | | | 19,137 | | | | 19,137 | |
| Other assets | | | 1,335 | | | | 1,076 | |
| Total assets | | $ | 329,335 | | | $ | 306,913 | |
| | | | | | | | | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | | | |
| | | | | | | | | |
| Current liabilities: | | | | | | | | |
Accounts payable | | $ | 6,910 | | | $ | 7,959 | |
Accrued salaries and benefits | | | 11,358 | | | | 11,779 | |
Accrued insurance and claims | | | 9,086 | | | | 6,274 | |
Accrued fuel expense | | | 12,170 | | | | 6,425 | |
Other accrued expenses | | | 11,916 | | | | 12,157 | |
Current maturities of long-term debt | | | 8,290 | | | | 10,736 | |
Current maturities of capital lease obligations | | | 6,454 | | | | 6,228 | |
| Total current liabilities | | | 66,184 | | | | 61,558 | |
Long-term debt, net of current maturities | | | 45,645 | | | | 28,886 | |
Capital lease obligations, net of current maturities | | | 42,117 | | | | 48,792 | |
Deferred income taxes | | | 31,512 | | | | 20,332 | |
Minority interest | | | 25 | | | | 25 | |
| Stockholders’ equity: | | | | | | | | |
Common stock, $0.033 par value, authorized 40,000,000 shares; issued and outstanding 23,704,046 and 23,581,245 shares at June 30, 2008 and 2007, respectively | | | 782 | | | | 778 | |
| Treasury stock at cost; 1,832,386 and 0 shares at June 30, 2008 and 2007, respectively | | | (12,633 | ) | | | --- | |
Additional paid-in capital | | | 95,173 | | | | 93,582 | |
Retained earnings | | | 60,881 | | | | 54,345 | |
Accumulated other comprehensive loss | | | (351 | ) | | | (1,385 | ) |
| Total stockholders’ equity | | | 143,852 | | | | 147,320 | |
| Total liabilities and stockholders’ equity | | $ | 329,335 | | | $ | 306,913 | |
CELADON GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands except per share amounts)
(Unaudited)
| | | For the three months ended June 30, | | | For the fiscal year ended June 30, | |
| | | 2008 | | | 2007 | | | 2008 | | | 2007 | |
Revenue: | | | | | | | | | | | | |
Freight revenue | | $ | 116,704 | | | $ | 112,731 | | | $ | 457,482 | | | $ | 433,012 | |
Fuel surcharges | | | 37,914 | | | | 18,964 | | | | 108,413 | | | | 69,680 | |
| | | | 154,618 | | | | 131,695 | | | | 565,895 | | | | 502,692 | |
| | | | | | | | | | | | | | | | | |
Operating expenses: | | | | | | | | | | | | | | | | |
Salaries, wages, and employee benefits | | | 42,463 | | | | 37,287 | | | | 159,859 | | | | 144,845 | |
Fuel | | | 50,645 | | | | 31,331 | | | | 163,111 | | | | 116,251 | |
Operations and maintenance | | | 9,780 | | | | 8,726 | | | | 37,213 | | | | 32,299 | |
Insurance and claims | | | 3,823 | | | | 2,225 | | | | 15,527 | | | | 13,054 | |
Depreciation and amortization | | | 9,431 | | | | 7,718 | | | | 33,264 | | | | 21,880 | |
Revenue equipment rentals | | | 5,571 | | | | 6,600 | | | | 25,596 | | | | 31,900 | |
Purchased transportation | | | 19,278 | | | | 20,640 | | | | 82,205 | | | | 73,699 | |
Costs of products and services sold | | | 1,544 | | | | 1,619 | | | | 6,406 | | | | 6,961 | |
Communications and utilities | | | 1,332 | | | | 1,288 | | | | 5,117 | | | | 4,838 | |
Operating taxes and licenses | | | 2,394 | | | | 2,244 | | | | 9,112 | | | | 8,629 | |
General and other operating | | | 2,686 | | | | 2,155 | | | | 9,687 | | | | 8,236 | |
Total operating expenses | | | 148,947 | | | | 121,833 | | | | 547,097 | | | | 462,592 | |
| | | | | | | | | | | | | | | | | |
Operating income | | | 5,671 | | | | 9,862 | | | | 18,798 | | | | 40,100 | |
| | | | | | | | | | | | | | | | | |
Other (income) expense: | | | | | | | | | | | | | | | | |
Interest income | | | (4 | ) | | | (5 | ) | | | (106 | ) | | | (21 | ) |
Interest expense | | | 1,251 | | | | 1,474 | | | | 5,028 | | | | 3,532 | |
Other (income) expense, net | | | 41 | | | | 70 | | | | 193 | | | | 109 | |
Income before income taxes | | | 4,383 | | | | 8,323 | | | | 13,683 | | | | 36,480 | |
Provision for income taxes | | | 2,220 | | | | 3,178 | | | | 7,147 | | | | 14,228 | |
Net income | | $ | 2,163 | | | $ | 5,145 | | | $ | 6,536 | | | $ | 22,252 | |
| | | | | | | | | | | | | | | | | |
Earnings per common share: | | | | | | | | | | | | | | | | |
Diluted earnings per share | | $ | 0.10 | | | $ | 0.22 | | | $ | 0.29 | | | $ | 0.94 | |
Basic earnings per share | | $ | 0.10 | | | $ | 0.22 | | | $ | 0.29 | | | $ | 0.96 | |
Average shares outstanding: | | | | | | | | | | | | | | | | |
Diluted | | | 21,913 | | | | 23,820 | | | | 22,617 | | | | 23,697 | |
Basic | | | 21,689 | | | | 23,407 | | | | 22,378 | | | | 23,252 | |
Key Operating Statistics
| | For the three months ended June 30, 2008 | For the three months ended June 30, 2007 |
| Operating Statistics (U.S./Canada Truckload) |
Average revenue per loaded mile (*) | $1.506 | $1.527 |
Average revenue per total mile (*) | $1.360 | $1.367 |
Avg. revenue per tractor per week (*) | $2,805 | $2,762 |
| Average miles per tractor per week | 2,063 | 2,021 |
| Average tractors (**) | 2,675 | 2,624 |
Tractors at end of period (***) | 2,929 | 3,016 |
Trailers at end of period (***) | 8,932 | 7,843 |
| Operating Ratio (*) | 95.1% | 91.3% |
| * | Excluding fuel surcharges. |
| ** | Excludes tractors operated by our Mexican subsidiary, Jaguar. |
| *** | Total fleet, including equipment operated by independent contractors and our Mexican subsidiary, Jaguar. |
