EXHIBIT 99
February 14, 2005
FOR IMMEDIATE RELEASE
Press Contact: Douglas C. Sandvig
Senior Vice President,
Treasurer and Chief Financial Officer
Smithway Motor Xpress Corp.
(515) 576-7418
SMITHWAY MOTOR XPRESS CORP. REPORTS FOURTH QUARTER AND YEAR END RESULTS
FORT DODGE, IOWA (PR Newswire) February 14, 2005—Smithway Motor Xpress Corp. (Nasdaq SmallCap Market: SMXC) announced today financial and operating results for the fourth quarter and year ended December 31, 2004.
For the fourth quarter of 2004, operating revenue increased approximately 23% to $50.1 million from $40.7 million for the corresponding quarter in 2003. Operating revenue, excluding fuel surcharge revenue of $5.3 million, increased approximately 14% to $44.8 million from $39.4 million for the corresponding quarter in 2003. Net earnings were $387,000, or $0.08 per basic and diluted share, compared with net loss of $268,000, or $0.06 per basic and diluted share, for the same quarter in 2003.
For the year, operating revenue increased approximately 14% to $189.0 million from $165.3 million in 2003. Operating revenue, excluding fuel surcharge revenue of $13.4 million, increased approximately 10% to $175.6 million from $159.5 million in 2003. Net earnings were $2.2 million, or $0.46 per basic share and $0.45 per diluted share, compared with net loss of $2.6 million, or $0.53 per basic and diluted share, for 2003.
Net earnings for 2004 include $727,000, or $0.15 per basic and diluted share, of tax-free life insurance proceeds received during the first quarter. Without the life insurance proceeds, net earnings for the year would have been $1.5 million, or $0.31 per basic and diluted share, compared with net loss of $2.6 million, or $0.53 per basic and diluted share, for 2003.
G. Larry Owens, President and Chief Executive Officer, commented, “Smithway’s results for the fourth quarter 2004 mark our fourth consecutive profitable quarter and first profitable year since 1999. For the quarter, average revenue per seated tractor per week increased by $194, or 8%, compared to the fourth quarter of 2003 as freight demand remains strong. During the quarter we experienced a ten cent increase in revenue per loaded mile, increased revenue miles per tractor, and decreased deadhead.
Higher truck production and freight rates have allowed us to absorb a two cent per mile driver pay increase and unusually high fuel prices. For the first time since 2001 we ended the year with a larger fleet compared to the previous year. We continue to increase freight rates, which will allow us to increase driver wages by another one cent per mile effective March 1, 2005. Almost all of our trucks are seated at this time but we understand that further driver pay increases are necessary to enable us to attract and retain safe, experienced, professional drivers. We continue to modernize our tractor and trailer fleet and plan to purchase 200 replacement tractors and 280 replacement trailers in 2005.
We are pleased with these financial results and look forward to further improvement in 2005 through modest fleet growth and continued improvement in our operating ratio.”
Smithway is a truckload carrier that hauls diversified freight nationwide, concentrating primarily on the flatbed segment of the truckload market. Its Class A Common Stock is traded on the Nasdaq SmallCap Market under the symbol “SMXC.”
This press release and statements made by the Company in its stockholder reports and public filings, as well as oral public statements by Company representatives, may contain certain forward-looking information, usually identified by words such as “anticipates,” “believes,” “estimates,” “projects,” “expects,” or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in forward-looking statements. The following factors, among others, could cause actual results to differ materially from those in forward-looking statements: failure to sustain the recent return to quarterly operating profitability, which could result in violation of bank covenants and acceleration of indebtedness at several financial institutions; the ability to obtain financing on acceptable terms, and obtain waivers and amendments to current financing in the event of default; economic recessions or downturns in customers’ business cycles; excessive increases in capacity within truckload markets; surplus inventories; decreased demand for transportation services offered by the Company; increases or rapid fluctuations in inflation, interest rates, fuel prices, and fuel hedging; the availability and costs of attracting and retaining qualified drivers and owner-operators; increases in insurance premiums and deductible amounts, or changes in excess coverage, relating to accident, cargo, workers’ compensation, health, and other claims; the resale value of used equipment and prices of new equipment; seasonal factors such as harsh weather conditions that increase operating costs; regulatory requirements that increase costs and decrease efficiency, including emissions standards and hours-of-service regulations; changes in management; and the ability to negotiate, consummate, and integrate acquisitions. Readers should review and consider the various disclosures made by the Company in this press release, stockholder reports, and in its Forms 10-K, 10-Q, and other public filings. The Company disclaims any such obligation to update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.
SMITHWAY MOTOR XPRESS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except share and per share data and operating statistics)
Three months ended | Year ended | |||||||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||||||||
2003 | 2004 | 2003 | 2004 | |||||||||||||||||||||
Operating revenue: | ||||||||||||||||||||||||
Freight | $ | 40,592 | $ | 49,852 | $ | 164,648 | $ | 188,190 | ||||||||||||||||
Other | 149 | 212 | 681 | 811 | ||||||||||||||||||||
Operating revenue | 40,741 | 50,064 | 165,329 | 189,001 | ||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||
Purchased transportation | 13,006 | 16,254 | 55,596 | 61,638 | ||||||||||||||||||||
Compensation and employee benefits | 12,694 | 14,196 | 51,506 | 54,468 | ||||||||||||||||||||
Fuel, supplies, and maintenance | 7,506 | 11,075 | 29,857 | 38,427 | ||||||||||||||||||||
Insurance and claims | 1,125 | 1,683 | 4,393 | 5,636 | ||||||||||||||||||||
Taxes and licenses | 871 | 875 | 3,444 | 3,653 | ||||||||||||||||||||
General and administrative | 1,853 | 1,781 | 6,934 | 6,929 | ||||||||||||||||||||
Communications and utilities | 333 | 312 | 1,463 | 1,274 | ||||||||||||||||||||
Depreciation and amortization | 3,281 | 2,645 | 14,239 | 12,340 | ||||||||||||||||||||
Total operating expenses | 40,669 | 48,821 | 167,432 | 184,365 | ||||||||||||||||||||
(Loss) earnings from operations | 72 | 1,243 | (2,103 | ) | 4,636 | |||||||||||||||||||
Other (expense) income: | ||||||||||||||||||||||||
Interest expense | (392 | ) | (422 | ) | (1,781 | ) | (1,563 | ) | ||||||||||||||||
Interest income | 1 | 28 | 26 | 54 | ||||||||||||||||||||
Life Insurance Proceeds | — | — | — | 727 | ||||||||||||||||||||
(Loss) earnings before income taxes | (319 | ) | 849 | (3,858 | ) | 3,854 | ||||||||||||||||||
Income tax (benefit) expense | (51 | ) | 462 | (1,269 | ) | 1,613 | ||||||||||||||||||
Net (loss) earnings | $ | (268 | ) | $ | 387 | $ | (2,589 | ) | $ | 2,241 | ||||||||||||||
Basic (loss) earnings per share | $ | (0.06 | ) | $ | 0.08 | $ | (0.53 | ) | $ | 0.46 | ||||||||||||||
Diluted (loss) earnings per share | $ | (0.06 | ) | $ | 0.08 | $ | (0.53 | ) | $ | 0.45 | ||||||||||||||
Basic weighted average common shares outstanding | 4,846,821 | 4,860,841 | 4,846,821 | 4,850,935 | ||||||||||||||||||||
Diluted weighted average common shares outstanding | 4,846,821 | 4,986,329 | 4,846,821 | 4,951,934 |
Operating Statistics
2003 | 2004 | 2003 | 2004 | |||||||||||||||||||||||||||||
Operating ratio | 99.8 | % | 97.5 | % | 101.3 | % | 97.5 | % | ||||||||||||||||||||||||
Average operating revenue per | $ | 2,642 | $ | 3,159 | $ | 2,577 | $ | 3,065 | ||||||||||||||||||||||||
tractor per week | ||||||||||||||||||||||||||||||||
Average revenue per tractor per week | $ | 2,434 | * | $ | 2,679 | * | $ | 2,367 | * | $ | 2,712 | * | ||||||||||||||||||||
Average revenue per seated tractor | $ | 2,548 | * | $ | 2,742 | * | $ | 2,484 | * | $ | 2,797 | * | ||||||||||||||||||||
per week | ||||||||||||||||||||||||||||||||
Average length of haul in miles | 677 | 650 | 659 | 658 | ||||||||||||||||||||||||||||
Average revenue per loaded mile | $ | 1.40 | * | $ | 1.50 | * | $ | 1.37 | * | $ | 1.46 | * | ||||||||||||||||||||
Ending company tractors | 750 | 757 | 750 | 757 | ||||||||||||||||||||||||||||
Ending owner/operators tractors | 430 | 445 | 430 | 445 | ||||||||||||||||||||||||||||
Ending trailers | 2,278 | 2,101 | 2,278 | 2,101 | ||||||||||||||||||||||||||||
Weighted average tractors | 1,186 | 1,219 | 1,234 | 1,186 |
*excludes fuel surcharge, brokerage, and other revenue.
SMITHWAY MOTOR XPRESS CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
December 31, | December 31, | |||||||||||||||||||
2003 | 2004 | |||||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | 355 | $ | 5,054 | ||||||||||||||||
Receivables, net | 14,697 | 16,776 | ||||||||||||||||||
Inventories | 882 | 948 | ||||||||||||||||||
Prepaid expenses and other | 4,304 | 4,142 | ||||||||||||||||||
Total current assets | 20,238 | 26,920 | ||||||||||||||||||
Property and equipment | 124,634 | 117,048 | ||||||||||||||||||
Less accumulated depreciation | 70,235 | 67,772 | ||||||||||||||||||
Net property and equipment | 54,399 | 49,276 | ||||||||||||||||||
Other assets | 2,043 | 2,080 | ||||||||||||||||||
Total assets | $ | 76,680 | $ | 78,276 | ||||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||
Current debt | $ | 10,582 | $ | 9,301 | ||||||||||||||||
Accounts payable and accrued expenses | 13,438 | 15,256 | ||||||||||||||||||
Total current liabilities | 24,020 | 24,557 | ||||||||||||||||||
Long-term debt | 23,035 | 20,008 | ||||||||||||||||||
Deferred income taxes | 9,020 | 10,702 | ||||||||||||||||||
Total liabilities | 56,075 | 55,267 | ||||||||||||||||||
Stockholders' equity | 20,605 | 23,009 | ||||||||||||||||||
Total liabilities and stockholders’ equity | $ | 76,680 | $ | 78,276 | ||||||||||||||||