Exhibit 99.1
USA Truck Reports Second Quarter 2016 Results
Disposed of high-cost equipment during quarter, with additional fleet reductions planned over the remainder of 2016
USAT Logistics increased load count by 12% compared to year-ago quarter while maintaining gross margin percentage; continues to move towardgoal of 50% of the Company’s consolidated operating revenue
Q2 EPS of ($0.15), before adjustments, compared to EPS of $0.26 a year earlier, driven predominately by negative rate environment and lower volumes with certain dedicated customers
Van Buren, AR – August 3, 2016 –USA Truck, Inc. (NASDAQ: USAK), a leading capacity solutions provider, today announced its financial results for the three and six months ended June 30, 2016.
For the quarter ended June 30, 2016, operating revenue was $109.9 million compared to $133.6 million for the prior-year period. Base revenue, which excludes fuel surcharges, was $99.5 million compared to $117.2 million for the June 2015 period. Net income (loss) was ($1.3) million, or ($0.15) per diluted share, compared to $2.8 million, or $0.26 per diluted share a year earlier. Included in loss per share for the June 30, 2016 quarter was $0.7 million, or $0.05, net-of-tax, per share of severance costs included in salaries, wages and employee benefits.
President and CEO Randy Rogers commented, “USA Truck’s results were negatively impacted by a rate environment that deteriorated markedly versus the prior year quarter (base revenue per loaded mile dropped by $0.17 or 9.1%), and by the lower volumes with certain dedicated customers. Despite the disappointing quarterly results, the Company generated incremental progress from previously announced initiatives, and believes it can produce substantially improved results through the following actions, all of which are in process:
| | ● | Accelerated disposal of high cost equipment |
| | ● | Expanded focus on cost control, including a reduction in force in the second quarter |
| | ● | Continued refinement of its network to build greater density, aided by a lower fleet size |
| | ● | Continued growth of USAT Logistics market share as demonstrated by increased load count in the quarter |
“The key deliverable of our strategy is the improvement of return on invested capital, which we expect to achieve through the following means: (1) reducing the fleet size to reflect the uncertain industry environment; (2) growing USAT’s market share by load count by converting its sales model to dedicated client managers in every regional center and recruiting industry-leading talent; (3) converting the truckload network to one that is more geographically focused with greater lane density, and pursuing contracts that reflect a commitment to a disciplined network structure and pricing objectives; (4) higher utilization of equipment and improved driver satisfaction; and (5) strong attention on reducing controllable costs, particularly in trucking maintenance and overhead.”
Among the initiatives USA Truck has been and will continue to pursue are:
| | ● | Disposal of high cost equipment.The Company continues to reduce its fleet to match capacity demands, and has now lowered company-owned tractors 5.3% year to date, helping lead to a third consecutive quarter of improved utilization and greater mileage for drivers. The Company continues to engage in a systematic elimination of high cost equipment to create a smaller, more efficient fleet and bring its trailer to tractor ratio to 3:1. For the full year, the Company anticipates a reduction of at least 130 tractors (or a total of 8.4% of the current fleet) and more than 400 trailers. This would retire all of the Company’s 2012 model year trucks. The Company also plans to accelerate retirement of approximately 220 of its 2013 model year tractors and expects to defer future tractor purchases beyond current commitments until conditions improve. |
| | ● | Focus on cost control.The Company continued the transition of maintenance costs from fixed to variable while identifying additional opportunities to reduce controllable costs. Building upon the closure of four maintenance facilities, the Company now outsources approximately 80% of direct repair and maintenance spend, including its entire mounted tire program, and is reviewing additional measures to leverage its external spend through key supplier agreements and programs. In addition, USA Truck has completed a restructuring of its road assistance program to reduce costs and increase reliability, eliminating unnecessary call fees, making better use of engine diagnostics capabilities and offering better service to drivers. The Company still maintains a small footprint of strategic shops with a focus on preventative maintenance and equipment sales preparation to further bring maintenance costs down. With respect to overhead, USA Truck implemented a further reduction in force and decided not to fill open positions, which is expected to generate savings of approximately $2.0 million annually. |
| | ● | Greater discipline across operations.Management continued to refine its network and build density in key head-haul markets by improving the quality of freight managed through more effective operations and sales planning. The Trucking segment saw miles per seated truck climb for the third consecutive quarter, despite not receiving its normal second quarter volume uplift. The Company expects to identify additional opportunities to ensure a greater focus on efficiency throughout its operations. |
| | ● | Growth of USAT Logistics market share. USAT Logistics, the Company’s asset light business, captured market share as demonstrated by load count despite a soft market by implementing new client- and carrier-focused roles, and increased its load count by 12% year-over-year while maintaining its gross margin percentage. In addition to adding eleven highly respected logistics professionals with strong industry relationships, the Company launched several initiatives it expects will drive further market share expansion, including the introduction of an outside sales agent program and expanding its flatbed service offering. The Company intends to aggressively pursue opportunities in this segment and grow the percentage of revenue attributable to the asset-light marketplace. |
Outlook
Given the deterioration in industry conditions in the past quarter and lower volumes with certain dedicated customers, Trucking’s adjusted operating ratio is unlikely to improve by up to 200 basis points this year compared to 2015 as the Company had previously anticipated. Going forward, the Company will focus on improving its base rate per loaded mile, improving the productivity of its sales force, and better utilizing its tractors as it continues to build density in its more focused network. Although conditions in the third quarter remain difficult, the Company has seen indications that rates are stabilizing. The Company has also made progress in increasing the amount of committed freight it handles and continues to win additional new business in line with its greater focus on serving customers in more profitable lanes.
The Company believes that it will be able to report an improved Trucking adjusted operating ratio for the second half of the year compared to the first half. The Company remains committed to its goal of achieving an adjusted operating ratio of 90%, but expects the timeframe to achieve that may be delayed past the fourth quarter of 2017, as previously announced. Achieving this goal depends on the improvement of industry fundamentals, continued streamlining of its fleet and network, and continued reduction in controllable costs. The Company continues to work toward its goal of having USAT Logistics revenue account for 50% of the Company’s consolidated operating revenue.
Six-Month Financial Results
For the six months ended June 30, 2016, operating revenue was $220.5 million compared to $266.5 million for the prior-year period. Consolidated base revenue was $201.5 million compared to $232.7 million for the six months ended June 30, 2015. Consolidated net income (loss) was ($3.2) million, or ($0.35) per diluted share, for the 2016 period, compared to $4.4 million, or $0.42 per diluted share, for the same 2015 period. Included in loss per diluted share for the six months ended June 30, 2016 was $6.0 million, or $0.41, net-of-tax, per diluted share relating to restructuring, impairment and other costs, as well as the severance charges discussed above. Included in earnings per share for the six months ended June 30, 2015 was $0.8 million, or $0.04, net-of-tax, per diluted share relating to loss on extinguishment of debt.
The following table includes key operating results and statistics by reportable segment:
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2016 | | | 2015 | | | 2016 | | | 2015 | |
Trucking: | | | | | | | | | | | | | | | | |
Operating revenue(in thousands) | | $ | 75,504 | | | $ | 93,427 | | | $ | 151,206 | | | $ | 189,214 | |
Operating (loss) income (in thousands) (1) | | $ | (2,733 | ) | | $ | 2,556 | | | $ | (7,102 | ) | | $ | 4,105 | |
Adjusted operating ratio (2) | | | 103.0 | % | | | 96.8 | % | | | 101.1 | % | | | 97.5 | % |
Total miles(in thousands) (3) | | | 44,979 | | | | 48,777 | | | | 88,850 | | | | 99,368 | |
Deadhead percentage (4) | | | 12.6 | % | | | 12.5 | % | | | 12.5 | % | | | 12.2 | % |
Base revenue per loaded mile | | $ | 1.712 | | | $ | 1.883 | | | $ | 1.752 | | | $ | 1.857 | |
Average number of in-service tractors (5) | | | 1,834 | | | | 2,059 | | | | 1,825 | | | | 2,119 | |
Average number of seated tractors (6) | | | 1,743 | | | | 1,869 | | | | 1,751 | | | | 1,929 | |
Average miles per seated tractor per week | | | 1,985 | | | | 2,008 | | | | 1,952 | | | | 1,992 | |
Base revenue per seated tractor per week | | $ | 2,969 | | | $ | 3,307 | | | $ | 2,991 | | | $ | 3,246 | |
Average loaded miles per trip | | | 594 | | | | 593 | | | | 578 | | | | 605 | |
| | | | | | | | | | | | | | | | | |
USAT Logistics: | | | | | | | | | | | | | | | | |
Operating revenue(in thousands) | | $ | 34,384 | | | $ | 40,146 | | | $ | 69,300 | | | $ | 77,246 | |
Operating income(in thousands) (1) | | $ | 2,176 | | | $ | 3,258 | | | $ | 4,182 | | | $ | 6,235 | |
Net revenue(in thousands) (7) | | $ | 6,714 | | | | 7,515 | | | | 13,432 | | | | 14,255 | |
Gross margin percentage (8) | | | 18.1 | % | | | 18.1 | % | | | 18.4 | % | | | 17.8 | % |
| | (1) | Operating income (loss) is calculated by deducting operating expenses from operating revenues. |
| | (2) | Adjusted operating ratio is calculated as operating expenses less restructuring, impairment and other costs, and severance costs included in salaries, wages and employee benefits, net of fuel surcharge revenue, as a percentage of operating revenue excluding fuel surcharge revenue. See GAAP to non-GAAP reconciliation below. |
| | (3) | Total miles include both loaded and empty miles. |
| | (4) | Deadhead percentage is calculated by dividing empty miles into total miles. |
| | (5) | Tractors include company-operated tractors in service, plus tractors operated by independent contractors. |
| | (6) | Seated tractors are those occupied by drivers. |
| | (7) | Net revenue is calculated by taking revenue less purchased transportation. |
| | (8) | Gross margin percentage is calculated by taking revenue less purchased transportation expense and dividing that amount by revenue. This calculation includes intercompany revenues and expenses. |
Balance Sheet and Liquidity
As of June 30, 2016, our total debt and capital lease obligations, net of cash (“Net Debt”), was $131.4 million and our stockholders’ equity was $70.0 million. Net Debt to Adjusted EBITDA(a) increased year-over-year to 2.6x compared with 1.3x as of June 30, 2015. The Company had approximately $58 million available under its credit facility as of July 31, 2016.
During the second quarter of 2016, USA Truck repurchased 718,143 shares of common stock (8.3% of total shares outstanding at June 30, 2016, net of treasury shares) under its repurchase authorizations at an average price of $18.69 per share for an aggregate purchase price of $13.4 million. Based on activity through August 1, 2016, the Company has 553 thousand shares available under the previously approved two million share repurchase authorization.
Second Quarter 2016 Conference Call Information
USA Truck will hold a conference call to discuss its second quarter 2016 results on August 3, 2016 at 8:00 AM CT / 9:00 AM ET. To participate in the call, please dial 1-844-824-3828 (U.S./Canada) or 1-412-317-5138 (International). A live webcast of the conference call will be broadcast in the Investor Relations section of the Company’s websitewww.usa-truck.com, under the “Events & Presentations” tab of the “Investor Relations” menu. For those who cannot listen to the live broadcast, the presentation materials and an audio replay of the call will be available at our website,www.usa-truck.com, under the “Events & Presentations” tab of the “Investor Relations” menu. A telephone replay of the call will also be available through August 10, 2016,and may be accessed by calling 1-877-344-7529 (U.S./Canada) or 1-412-317-0088 (International) and by referencing conference ID #10089116.
(a)About Non-GAAP Financial Information
In addition to our GAAP results, this press release also includes certain non-GAAP financial measures, as defined by the SEC. The terms base revenue, “EBITDA”, “Adjusted EBITDA”, “Adjusted operating ratio”, and “Adjusted earnings per diluted share”, as we define them, are not presented in accordance with GAAP.
The Company defines EBITDA as net income (loss), plus interest expense net of interest income, provision for income taxes and depreciation and amortization. It defines Adjusted EBITDA as these items plus non-cash equity compensation, loss on extinguishment of debt, restructuring, impairment and other costs, and severance costs included in salaries, wages and employee benefits. Adjusted operating ratio is calculated as operating expenses lessrestructuring, impairment and other costsand severance costs included in salaries, wages and employee benefits, net of fuel surcharges, as a percentage of operating revenue excluding fuel surcharge revenue. Adjusted earnings per diluted share is defined asearnings or loss before income taxes plus loss on extinguishment of debt, restructuring, impairment and other costs, and severance costs included in salaries, wages and employee benefits reduced by our statutory income tax rate, divided by weighted average diluted shares outstanding. These financial measures supplement our GAAP results in evaluating certain aspects of our business. We believe that using these measures improves comparability in analyzing our performance because they remove the impact of items from our operating results that, in our opinion, do not reflect our core operating performance. Management and the board of directors focus on EBITDA, Adjusted EBITDA, Adjusted operating ratio and Adjusted earnings per diluted share as key measures of our performance, all of which are reconciled to the most comparable GAAP financial measures and further discussed below. We believe our presentation of these non-GAAP financial measures is useful because it provides investors and securities analysts the same information that we use internally for purposes of assessing our core operating performance.
EBITDA, Adjusted EBITDA, Adjusted operating ratio and Adjusted earnings per diluted share are not substitutes for their comparable GAAP financial measures, such as net income, cash flows from operating activities, operating margin, or other measures prescribed by GAAP. There are limitations to using non-GAAP financial measures. Although we believe that they improve comparability in analyzing our period to period performance, they could limit comparability to other companies in our industry if those companies define these measures differently. Because of these limitations, our non-GAAP financial measures should not be considered measures of income generated by our business or discretionary cash available to us to invest in the growth of our business. Management compensates for these limitations by primarily relying on GAAP results and using non-GAAP financial measures on a supplemental basis.
Pursuant to the requirements of Regulation G and Regulation S-K, we have provided reconciliations of EBITDA, Adjusted EBITDA, Adjusted earnings per diluted share and Adjusted operating ratio to GAAP financial measures at the end of this press release.
Cautionary Statement Concerning Forward-Looking Statements
Financial information in this press release is preliminary and based upon information available to the Company as of the date of this press release. As such, this information remains subject to the completion of our quarterly review procedures, and the filing of the related Form 10-Q, which could result in changes, some of which could be material, to the preliminary information provided in this press release.
This press release contains 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 forward-looking statements are made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. These statements generally may be identified by their use of terms or phrases such as “expects,” “estimates,” “anticipates,” “projects,” “believes,” “plans,” “goals,” “intends,” “may,” “will,” “should,” “could,” “potential,” “continue,” “strategy,” “future” and terms or phrases of similar substance. 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. Accordingly, actual results may differ materially from those set forth in the forward-looking statements. Readers should review and consider the factors that may affect future results and other disclosures by the Company in its press releases, Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made. 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. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this press release might not occur. All forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by this cautionary statement.
References to the “Company,” “we,” “us,” “our” and words of similar import refer to USA Truck, Inc. and its subsidiary.
About USA Truck
USA Truck provides comprehensive capacity solutions to a broad and diverse customer base throughout North America. Our Trucking and USAT Logistics divisions blend an extensive portfolio of asset and asset-light services, offering a balanced approach to supply chain management including customized truckload, dedicated contract carriage, intermodal and third-party logistics freight management services. For more information, visit usa-truck.com or usatlogistics.com.
This press release and related information will be available to interested parties at our website, www.usa-truck.com, under the “Financial Releases” tab of the “Investor Relations” menu.
Company Contact
USA Truck, Inc.
Randy Rogers
President and CEO
(479) 471-6590
Randy.Rogers@usa-truck.com
Investor Relations Contact
Harriet Fried / Jody Burfening
LHA
(212) 838-3777
hfried@lhai.com
USA TRUCK, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(UNAUDITED)
(in thousands, except per share data)
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2016 | | | 2015 | | | 2016 | | | 2015 | |
Revenue: | | | | | | | | | | | | | | | | |
Operating revenue | | $ | 109,888 | | | $ | 133,573 | | | $ | 220,506 | | | $ | 266,460 | |
| | | | | | | | | | | | | | | | | |
Operating expenses: | | | | | | | | | | | | | | | | |
Salaries, wages and employee benefits | | | 30,627 | | | | 35,636 | | | | 63,201 | | | | 73,508 | |
Fuel and fuel taxes | | | 11,391 | | | | 16,257 | | | | 21,580 | | | | 34,235 | |
Depreciation and amortization | | | 7,599 | | | | 10,447 | | | | 14,871 | | | | 21,249 | |
Insurance and claims | | | 5,438 | | | | 5,903 | | | | 10,206 | | | | 12,097 | |
Equipment rent | | | 1,861 | | | | 866 | | | | 3,722 | | | | 1,649 | |
Operations and maintenance | | | 10,299 | | | | 10,610 | | | | 19,512 | | | | 20,901 | |
Purchased transportation | | | 38,030 | | | | 42,646 | | | | 74,432 | | | | 81,416 | |
Operating taxes and licenses | | | 1,260 | | | | 1,462 | | | | 2,381 | | | | 2,782 | |
Communications and utilities | | | 851 | | | | 880 | | | | 1,731 | | | | 1,743 | |
Gain on disposal of assets, net | | | (182 | ) | | | (2,255 | ) | | | (578 | ) | | | (2,758 | ) |
Restructuring, impairment and other costs | | | -- | | | | -- | | | | 5,264 | | | | -- | |
Other | | | 3,271 | | | | 5,307 | | | | 7,104 | | | | 9,298 | |
Total operating expenses | | | 110,445 | | | | 127,759 | | | | 223,426 | | | | 256,120 | |
Operating (loss) income | | | (557 | ) | | | 5,814 | | | | (2,920 | ) | | | 10,340 | |
| | | | | | | | | | | | | | | | | |
Other expenses (income): | | | | | | | | | | | | | | | | |
Interest expense, net | | | 731 | | | | 549 | | | | 1,295 | | | | 1,179 | |
Loss on extinguishment of debt | | | -- | | | | -- | | | | -- | | | | 750 | |
Other, net | | | 133 | | | | 370 | | | | 337 | | | | 572 | |
Total other expenses, net | | | 864 | | | | 919 | | | | 1,632 | | | | 2,501 | |
(Loss) income before income taxes | | | (1,421 | ) | | | 4,895 | | | | (4,552 | ) | | | 7,839 | |
Income tax (benefit) expense | | | (75 | ) | | | 2,125 | | | | (1,399 | ) | | | 3,434 | |
| | | | | | | | | | | | | | | | | |
Net (loss) income and comprehensive (loss) income | | $ | (1,346 | ) | | $ | 2,770 | | | $ | (3,153 | ) | | $ | 4,405 | |
| | | | | | | | | | | | | | | | | |
Net (loss) income per share information: | | | | | | | | | | | | | | | | |
Average shares outstanding (basic) | | | 8,734 | | | | 10,435 | | | | 9,069 | | | | 10,423 | |
Basic (loss) earnings per share | | $ | (0.15 | ) | | $ | 0.27 | | | $ | (0.35 | ) | | $ | 0.42 | |
| | | | | | | | | | | | | | | | | |
Average shares outstanding (diluted) | | | 8,734 | | | | 10,516 | | | | 9,069 | | | | 10,524 | |
Diluted (loss) earnings per share | | $ | (0.15 | ) | | $ | 0.26 | | | $ | (0.35 | ) | | $ | 0.42 | |
GAAP TO NON-GAAP RECONCILIATIONS
(UNAUDITED)
(dollar amounts in thousands, except per share amounts)
ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION
| | | Three Months Ended | |
| | | 06/30/2016 | | | 03/31/2016 | | | 12/31/2015 | | | 09/30/2015 | |
| | | | | | | | | | | | | | | | | |
Net (loss) income | | $ | (1,346 | ) | | $ | (1,807 | ) | | $ | 3,937 | | | $ | 2,727 | |
Add: | | | | | | | | | | | | | | | | |
Depreciation and amortization | | | 7,599 | | | | 7,272 | | | | 7,529 | | | | 8,702 | |
Income tax (benefit) expense | | | (75 | ) | | | (1,324 | ) | | | 2,677 | | | | 2,161 | |
Interest expense, net | | | 731 | | | | 565 | | | | 565 | | | | 493 | |
| | | | | | | | | | | | | | | | | |
EBITDA | | $ | 6,909 | | | $ | 4,706 | | | $ | 14,708 | | | $ | 14,083 | |
Add: | | | | | | | | | | | | | | | | |
Non-cash equity compensation | | | 262 | | | | 131 | | | | 291 | | | | 446 | |
Restructuring, impairment and other costs | | | -- | | | | 5,264 | | | | (151 | ) | | | 2,893 | |
Severance costs included in salaries, wages and employee benefits | | | 697 | | | | -- | | | | -- | | | | -- | |
Loss on debt extinguishment, pretax | | | -- | | | | -- | | | | -- | | | | -- | |
| | | | | | | | | | | | | | | | | |
Adjusted EBITDA | | $ | 7,868 | | | $ | 10,101 | | | $ | 14,848 | | | $ | 17,422 | |
ADJUSTED (LOSS) EARNINGS PER SHARE RECONCILIATION
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2016 | | | 2015 | | | 2016 | | | 2015 | |
(Loss) earnings per diluted share | | $ | (0.15 | ) | | $ | 0.26 | | | $ | (0.35 | ) | | $ | 0.42 | |
Adjusted for: | | | | | | | | | | | | | | | | |
Loss on debt extinguishment | | | -- | | | | -- | | | | -- | | | | 0.07 | |
Severance costs included in salaries, wages and employee benefits | | | 0.08 | | | | -- | | | | 0.08 | | | | -- | |
Restructuring, impairment and other costs | | | -- | | | | -- | | | | 0.58 | | | | -- | |
Income tax expense effect of adjustments | | | (0.03 | ) | | | -- | | | | (0.25 | ) | | | (0.03 | ) |
Adjusted diluted (loss) earnings per share | | $ | (0.10 | ) | | $ | 0.26 | | | $ | 0.06 | | | $ | 0.46 | |
ADJUSTED OPERATING RATIO RECONCILIATION
| | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2016 | | | 2015 | | | 2016 | | | 2015 | |
Operating revenue | | $ | 109,888 | | | $ | 133,573 | | | $ | 220,506 | | | $ | 266,460 | |
Less: | | | | | | | | | | | | | | | | |
Fuel surcharge revenue | | | 10,375 | | | | 16,350 | | | | 18,976 | | | | 33,768 | |
Base revenue | | | 99,513 | | | | 117,223 | | | | 201,530 | | | | 232,692 | |
Operating expense | | | 110,445 | | | | 127,759 | | | | 223,426 | | | | 256,120 | |
Adjusted for: | | | | | | | | | | | | | | | | |
Restructuring, impairment and other costs | | | -- | | | | -- | | | | (5,264 | ) | | | -- | |
Severance costs in salaries, wages and employee benefits | | | (697 | ) | | | -- | | | | (697 | ) | | | -- | |
Fuel surcharge revenue | | | (10,375 | ) | | | (16,350 | ) | | | (18,976 | ) | | | (33,768 | ) |
Adjusted operating expense | | $ | 99,373 | | | $ | 111,409 | | | $ | 198,489 | | | $ | 222,352 | |
Operating ratio | | | 100.5 | % | | | 95.6 | % | | | 101.3 | % | | | 96.1 | % |
Adjusted operating ratio | | | 99.9 | % | | | 95.0 | % | | | 98.5 | % | | | 95.6 | % |
Trucking Segment | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2016 | | | 2015 | | | 2016 | | | 2015 | |
Revenue | | $ | 75,750 | | | $ | 93,846 | | | $ | 151,786 | | | $ | 190,248 | |
Less: intersegment eliminations | | | 246 | | | | 419 | | | | 580 | | | | 1,034 | |
Operating revenue | | | 75,504 | | | | 93,427 | | | | 151,206 | | | | 189,214 | |
Less: fuel surcharge revenue | | | 8,227 | | | | 13,075 | | | | 15,048 | | | | 27,318 | |
Base revenue | | | 67,277 | | | | 80,352 | | | | 136,158 | | | | 161,896 | |
Operating expense | | | 78,238 | | | | 90,871 | | | | 158,308 | | | | 185,109 | |
Adjusted for: | | | | | | | | | | | | | | | | |
Restructuring, impairment and other costs | | | -- | | | | -- | | | | (4,848 | ) | | | -- | |
Severance costs in salaries, wages and employee benefits | | | (697 | ) | | | -- | | | | (697 | ) | | | -- | |
Fuel surcharge revenue | | | (8,227 | ) | | | (13,075 | ) | | | (15,048 | ) | | | (27,318 | ) |
Adjusted operating expense | | $ | 69,314 | | | $ | 77,796 | | | $ | 137,715 | | | $ | 157,791 | |
Operating ratio | | | 103.6 | % | | | 97.3 | % | | | 104.7 | % | | | 97.8 | % |
Adjusted operating ratio | | | 103.0 | % | | | 96.8 | % | | | 101.1 | % | | | 97.5 | % |
USAT Logistics Segment | | Three Months Ended | | | Six Months Ended | |
| | | June 30, | | | June 30, | |
| | | 2016 | | | 2015 | | | 2016 | | | 2015 | |
Revenue | | $ | 37,087 | | | $ | 41,605 | | | $ | 72,997 | | | $ | 80,276 | |
Less: intersegment eliminations | | | 2,703 | | | | 1,459 | | | | 3,697 | | | | 3,030 | |
Operating revenue | | | 34,384 | | | | 40,146 | | | | 69,300 | | | | 77,246 | |
Less: fuel surcharge revenue | | | 2,148 | | | | 3,275 | | | | 3,928 | | | | 6,450 | |
Base revenue | | | 32,236 | | | | 36,871 | | | | 65,372 | | | | 70,796 | |
Operating expense | | | 32,207 | | | | 36,888 | | | | 65,118 | | | | 71,011 | |
Adjusted for: | | | | | | | | | | | | | | | | |
Restructuring, impairment and other costs | | | -- | | | | -- | | | | (416 | ) | | | -- | |
Fuel surcharge revenue | | | (2,148 | ) | | | (3,275 | ) | | | (3,928 | ) | | | (6,450 | ) |
Adjusted operating expense | | $ | 30,059 | | | $ | 33,613 | | | $ | 60,774 | | | $ | 64,561 | |
Operating ratio | | | 93.7 | % | | | 91.9 | % | | | 94.0 | % | | | 91.9 | % |
Adjusted operating ratio | | | 93.2 | % | | | 91.2 | % | | | 93.0 | % | | | 91.2 | % |
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands, except share data)
| | | June 30, | | | December 31, | |
| | | 2016 | | | 2015 | |
Assets | | | | | | | | |
Current assets: | | | | | | | | |
Cash | | $ | 1,122 | | | $ | 87 | |
Accounts receivable, net of allowance for doubtful accounts of $587 and $608, respectively | | | 53,801 | | | | 53,324 | |
Other receivables | | | 4,086 | | | | 5,094 | |
Inventories | | | 477 | | | | 748 | |
Assets held for sale | | | 5,524 | | | | 7,979 | |
Income taxes receivable | | | 7,641 | | | | 6,159 | |
Prepaid expenses and other current assets | | | 4,796 | | | | 4,876 | |
Total current assets | | | 77,447 | | | | 78,267 | |
Property and equipment: | | | | | | | | |
Land and structures | | | 31,663 | | | | 32,910 | |
Revenue equipment | | | 292,317 | | | | 289,045 | |
Service, office and other equipment | | | 24,049 | | | | 22,156 | |
Property and equipment, at cost | | | 348,029 | | | | 344,111 | |
Accumulated depreciation and amortization | | | (125,615 | ) | | | (137,327 | ) |
Property and equipment, net | | | 222,414 | | | | 206,784 | |
Other assets | | | 1,301 | | | | 1,405 | |
Total assets | | $ | 301,162 | | | $ | 286,456 | |
Liabilities and Stockholders’ Equity | | | | | | | | |
Current liabilities: | | | | | | | | |
Accounts payable | | $ | 26,763 | | | $ | 24,473 | |
Current portion of insurance and claims accruals | | | 11,497 | | | | 10,706 | |
Accrued expenses | | | 10,776 | | | | 8,836 | |
Current maturities of capital leases | | | 16,901 | | | | 12,190 | |
Total current liabilities | | | 65,937 | | | | 56,205 | |
Deferred gain | | | 619 | | | | 701 | |
Long-term debt, less current maturities | | | 97,000 | | | | 70,400 | |
Capital leases, less current maturities | | | 18,642 | | | | 18,845 | |
Deferred income taxes | | | 40,386 | | | | 37,943 | |
Insurance and claims accruals, less current portion | | | 8,558 | | | | 8,585 | |
Total liabilities | | | 231,142 | | | | 192,679 | |
Commitments and contingencies | | | | | | | | |
Stockholders’ equity: | | | | | | | | |
Preferred Stock, $.01 par value; 1,000,000 shares authorized | | | -- | | | | -- | |
Common Stock, $.01 par value; 30,000,000 shares authorized; issued 12,107,609 shares, and 11,946,253 shares, respectively | | | 121 | | | | 119 | |
Additional paid-in capital | | | 67,628 | | | | 67,370 | |
Retained earnings | | | 62,718 | | | | 65,871 | |
Less treasury stock, at cost (3,445,807 shares, and 2,286,608 shares, respectively) | | | (60,447 | ) | | | (39,583 | ) |
Total stockholders’ equity | | | 70,020 | | | | 93,777 | |
Total liabilities and stockholders’ equity | | $ | 301,162 | | | $ | 286,456 | |
