Exhibit 99.1
 | News Announcement |
REMINDER:
Vitran management will conduct a conference call and webcast today, October 23, 2007 at 1:00 p.m. (ET), to discuss the Company’s 2007 third quarter results.
Conference call dial-in:800/255-2466
Live Webcast: www.vitran.com (select “Investor Relations”)
Vitran management will conduct a conference call and webcast today, October 23, 2007 at 1:00 p.m. (ET), to discuss the Company’s 2007 third quarter results.
Conference call dial-in:800/255-2466
Live Webcast: www.vitran.com (select “Investor Relations”)
CONTACT: | ||
| Richard Gaetz, President/CEO | Robert Rinderman | |
| Sean Washchuk, VP Finance/CFO | Steven Hecht | |
| Vitran Corporation Inc. | Jaffoni & Collins Incorporated | |
| 416/596-7664 | 212/835-8500 or VTNC@jcir.com |
FOR IMMEDIATE RELEASE
VITRAN REPORTS 2007 THIRD QUARTER OPERATING RESULTS
TORONTO, ONTARIO (October 23, 2007) — Vitran Corporation Inc. (NASDAQ: VTNC, TSX: VTN), a North American transportation and logistics firm, today announced quarterly financial results for the 2007 third quarter ended September 30, 2007 (all figures reported in $U.S.).
Vitran achieved net income of $3.1 million, or $0.23 per diluted share, on revenue of $171.9 million for the three-month period. As previously announced, the Company incurred a one-time, $0.3 million write-off of previously capitalized syndication costs, net of taxes, as a result of refinancing its debt with a new five-year bank syndication agreement that commenced August 1, 2007. The write-off impacted Vitran’s Q3 ’07 EPS by $0.02. In the comparable 2006 quarter, Vitran recorded net income of $4.9 million, or $0.38 per diluted share, on revenue of $121.5 million.
“We are clearly disappointed with Vitran’s third quarter results, as we came up short of our expectations due to a continuation of the highly competitive operating environment that impacted revenue growth and has put pressure on industry operating margins in recent quarters,” stated Vitran President and Chief Executive Officer Rick Gaetz. “While we are pleased with our penetration into new markets, we must improve in our core regional markets,” he continued.
“Despite the near-term economic challenges, the entire Vitran organization is focused on building our North American freight network and the solid corporate infrastructure that will be our backbone for achieving long-term growth. Our new hybrid operating system is now up and running successfully at PJAX and the Company’s operational integration is moving ahead, as planned,” concluded Mr. Gaetz.
During the nine-month period ended September 30, 2007, Vitran achieved net income of $12.0 million, or $0.88 per diluted share, on revenue of $496.2 million. The aforementioned one-time write-off of
| Vitran Q3 2007, 10/23/07 | page 2 of 7 |
previously capitalized syndication costs impacted nine-month EPS by $0.02. In the comparable nine months of 2006, the Company had net income of $14.4 million, or $1.11 per diluted share, on revenue of $360.3 million.
Segmented Results
Income from operations at Vitran’s LTL (less-than-truckload) segment was $5.7 million, with an OR (operating ratio) of 96.2, compared to Q3 ‘06 operating income of $6.6 million and an OR of 93.6. The LTL segment achieved a 56.5 percent increase in shipments, while tonnage rose 45.1 percent, during the period — due to the acquisition of PJAX. Revenue per hundredweight increased 0.7 percent, while revenue per shipment declined 6.6 percent, on a year-over-year basis.
Income from operations at Vitran’s LTL (less-than-truckload) segment was $5.7 million, with an OR (operating ratio) of 96.2, compared to Q3 ‘06 operating income of $6.6 million and an OR of 93.6. The LTL segment achieved a 56.5 percent increase in shipments, while tonnage rose 45.1 percent, during the period — due to the acquisition of PJAX. Revenue per hundredweight increased 0.7 percent, while revenue per shipment declined 6.6 percent, on a year-over-year basis.
The Logistics segment posted income from operations of $800,000 during Q3 ‘07, and its OR was 94.2. In Q3 ’06, the logistics unit had operating income of $929,000, with an OR of 91.1. Income from operations at the Truckload segment rose to $420,000, compared to $354,000 in the year-ago quarter, and OR improved to 94.7, versus 95.7 in the prior year.
Management’s 2007 EPS Guidance
While we are clearly unhappy with 2007 third quarter results, it is now obvious that we will not meet our annual guidance of $1.60 to $1.70 per share. We expect the challenging operating environment experienced in the third quarter to continue through the fourth quarter of 2007.
While we are clearly unhappy with 2007 third quarter results, it is now obvious that we will not meet our annual guidance of $1.60 to $1.70 per share. We expect the challenging operating environment experienced in the third quarter to continue through the fourth quarter of 2007.
About Vitran Corporation Inc.
Vitran Corporation Inc. is a North American group of transportation companies offering less-than-truckload, logistics, truckload, and freight brokerage services. To find out more about Vitran Corporation Inc. (NASDAQ:VTNC, TSX:VTN), visit the website at www.vitran.com.
Vitran Corporation Inc. is a North American group of transportation companies offering less-than-truckload, logistics, truckload, and freight brokerage services. To find out more about Vitran Corporation Inc. (NASDAQ:VTNC, TSX:VTN), visit the website at www.vitran.com.
This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. Forward-looking statements may be generally identifiable by use of the words “believe”, “anticipate”, “intend”, “estimate”, “expect”, “project”, “may”, “plans”, “continue”, “will”, “focus should” “endeavor” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on current expectations and are naturally subject to uncertainty and changes in circumstances that may cause actual results to differ materially from those expressed or implied by such forward-looking statements.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Vitran’s actual results, performance or achievements to differ materially from those projected in the forward-looking statements. Factors that may cause such differences include, but are not limited to,
| Vitran Q3 2007, 10/23/07 | page 3 of 7 |
technological change, increases in fuel costs, regulatory changes, the general health of the economy, seasonal fluctuations, unanticipated changes in railroad capacities, exposure to credit risks, changes in labour relations and competitive factors. More detailed information about these and other factors is included in the annual MD&A on Form 10K under the heading “General Risks and Uncertainties.” Additional information regarding non-GAAP measures is also included on Form 10K. Many of these factors are beyond the Company’s control; therefore, future events may vary substantially from what the Company currently foresees. You should not place undue reliance on such forward-looking statements. Vitran Corporation Inc. does not assume the obligation to revise or update these forward-looking statements after the date of this document or to revise them to reflect the occurrence of future unanticipated events, except as may be required under applicable securities laws.
(financial statements follow)
| Vitran Q3 2007, 10/23/07 | page 4 of 7 |
Vitran Corporation Inc.
Consolidated Balance Sheets
(in thousands of United States dollars, US GAAP)
Consolidated Balance Sheets
(in thousands of United States dollars, US GAAP)
| Sept. 30, 2007 | Dec. 31, 2006 | |||||||
| (Unaudited) | ||||||||
Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 3,819 | $ | 1,454 | ||||
| Accounts receivable | 81,419 | 66,051 | ||||||
| Inventory, deposits and prepaid expenses | 10,122 | 10,796 | ||||||
| Income tax receivable | 1,481 | — | ||||||
| Deferred income taxes | 3,776 | 1,720 | ||||||
| 100,617 | 80,021 | |||||||
| Property and equipment | 163,195 | 145,129 | ||||||
| Intangible assets | 14,205 | 15,888 | ||||||
| Goodwill | 119,811 | 117,146 | ||||||
| Other | — | 150 | ||||||
| $ | 397,828 | $ | 358,334 | |||||
Liabilities and Shareholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 75,650 | $ | 67,916 | ||||
| Income and other taxes payable | — | 1,275 | ||||||
| Current portion of long-term debt | 16,919 | 15,724 | ||||||
| 92,569 | 84,915 | |||||||
| Long-term debt | 103,263 | 93,139 | ||||||
| Other | 3,003 | — | ||||||
| Deferred income taxes | 9,547 | 6,983 | ||||||
| Shareholders’ equity: | ||||||||
| Common shares | 77,484 | 76,913 | ||||||
| Additional paid-in capital | 2,159 | 1,607 | ||||||
| Retained earnings | 102,974 | 90,933 | ||||||
| Accumulated other comprehensive income | 6,829 | 3,844 | ||||||
| 189,446 | 173,297 | |||||||
| $ | 397,828 | $ | 358,334 | |||||
(Statements of Income follows)
| Vitran Q3 2007, 10/23/07 | page 5 of 7 |
Vitran Corporation Inc.
Consolidated Statements Of Income
(Unaudited)
(in thousands of United States dollars except per share amounts, US GAAP)
Consolidated Statements Of Income
(Unaudited)
(in thousands of United States dollars except per share amounts, US GAAP)
| Three Months | Nine Months | |||||||||||||||
| Ended Sept. 30, | Ended Sept. 30, | |||||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||||
| Revenues | $ | 171,927 | $ | 121,512 | $ | 496,207 | $ | 360,280 | ||||||||
| Operating expenses | 145,457 | 101,189 | 414,693 | 299,617 | ||||||||||||
| Selling, general and administrative expenses | 15,633 | 11,195 | 46,015 | 33,675 | ||||||||||||
| Other income | (53 | ) | (248 | ) | (125 | ) | (404 | ) | ||||||||
| Depreciation and amortization expense | 5,321 | 2,579 | 15,375 | 7,495 | ||||||||||||
| 166,358 | 114,715 | 475,958 | 340,383 | |||||||||||||
| Income from operations before undernoted | 5,569 | 6,797 | 20,249 | 19,897 | ||||||||||||
| Interest expense, net | 2,325 | 274 | 6,504 | 621 | ||||||||||||
| Income from operations before income taxes | 3,244 | 6,523 | 13,745 | 19,276 | ||||||||||||
| Income taxes | 123 | 1,638 | 1,704 | 4,992 | ||||||||||||
| Net income from continuing operations | $ | 3,121 | $ | 4,885 | $ | 12,041 | $ | 14,284 | ||||||||
| Cumulative effect of change in accounting principle | — | — | — | 141 | ||||||||||||
| Net income | $ | 3,121 | $ | 4,885 | $ | 12,041 | $ | 14,425 | ||||||||
| Income per share: | ||||||||||||||||
Basic | ||||||||||||||||
| Net income from continuing operations | $ | 0.23 | $ | 0.38 | $ | 0.89 | $ | 1.12 | ||||||||
| Cumulative effect of change in accounting principle | — | — | — | 0.01 | ||||||||||||
| Net income | $ | 0.23 | $ | 0.38 | $ | 0.89 | $ | 1.13 | ||||||||
Diluted | ||||||||||||||||
| Net income from continuing operations | $ | 0.23 | $ | 0.38 | $ | 0.88 | $ | 1.10 | ||||||||
| Cumulative effect of change in accounting principle | — | — | — | 0.01 | ||||||||||||
| Net income | $ | 0.23 | $ | 0.38 | $ | 0.88 | $ | 1.11 | ||||||||
| Weighted average shares outstanding | ||||||||||||||||
| Basic | 13,475,685 | 12,744,936 | 13,459,180 | 12,710,225 | ||||||||||||
| Diluted | 13,668,819 | 12,966,835 | 13,660,723 | 12,956,661 | ||||||||||||
(Statements of Cash Flows follows)
| Vitran Q3 2007, 10/23/07 | page 6 of 7 |
VITRAN CORPORATION INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands of United States dollars, US GAAP)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands of United States dollars, US GAAP)
| Three months | Three months | Nine months | Nine months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| Sept. 30, 2007 | Sept. 30, 2006 | Sept. 30, 2007 | Sept. 30, 2006 | |||||||||||||
| Cash provided by (used in): | ||||||||||||||||
Operations: | ||||||||||||||||
| Net income | $ | 3,121 | $ | 4,885 | $ | 12,041 | $ | 14,425 | ||||||||
| Items not involving cash from operations: | ||||||||||||||||
| Cumulative effect of change in accounting principle | — | — | — | (141 | ) | |||||||||||
| Depreciation and amortization expense | 5,321 | 2,579 | 15,375 | 7,495 | ||||||||||||
| Deferred income taxes | (2,608 | ) | 1,019 | (13 | ) | 1,591 | ||||||||||
| Share-based compensation expense | 261 | 218 | 720 | 627 | ||||||||||||
| Gain on sale of property and equipment | (53 | ) | (248 | ) | (125 | ) | (404 | ) | ||||||||
| Change in non-cash working capital components | 4,461 | 551 | (1,302 | ) | 997 | |||||||||||
| 10,503 | 9,004 | 26,696 | 24,590 | |||||||||||||
Investments: | ||||||||||||||||
| Purchase of property and equipment | (5,458 | ) | (9,216 | ) | (16,878 | ) | (20,745 | ) | ||||||||
| Proceeds on sale of property and equipment | 74 | 509 | 312 | 2,063 | ||||||||||||
| Additional payment due to acquisition of subsidiary | — | — | (6,921 | ) | — | |||||||||||
| Acquisition of business assets | — | — | — | (2,251 | ) | |||||||||||
| (5,384 | ) | (8,707 | ) | (23,487 | ) | (20,933 | ) | |||||||||
Financing: | ||||||||||||||||
| Change in revolving credit facility | 3,468 | 18,015 | 13,590 | 15,030 | ||||||||||||
| Proceeds from long-term debt | 70,500 | 70,500 | ||||||||||||||
| Repayment of long-term debt | (2,255 | ) | (9 | ) | (6,765 | ) | (1,961 | ) | ||||||||
| Financing costs | (642 | ) | — | (642 | ) | — | ||||||||||
| Repayment of capital leases | (1,858 | ) | — | (5,172 | ) | — | ||||||||||
| Issue of common shares upon exercise of stock options | 196 | — | 403 | 479 | ||||||||||||
| (1,091 | ) | 88,506 | 1,414 | 84,048 | ||||||||||||
| Effect of translation adjustment on cash | (1,256 | ) | 87 | (2,258 | ) | (90 | ) | |||||||||
| Increase (decrease) in cash position | 2,772 | 88,890 | 2,365 | 87,615 | ||||||||||||
| Cash position, beginning of period | 1,047 | 13,317 | 1,454 | 14,592 | ||||||||||||
| Cash position, end of period | $ | 3,819 | $ | 102,207 | $ | 3,819 | $ | 102,207 | ||||||||
| Change in non-cash working capital components: | ||||||||||||||||
| Accounts receivable | $ | (2,004 | ) | $ | (240 | ) | $ | (15,368 | ) | $ | (6,669 | ) | ||||
| Inventory, deposits and prepaid expenses | 233 | (2,129 | ) | 1,316 | (503 | ) | ||||||||||
| Income and other taxes receivable/payable | 2,866 | 495 | (3,121 | ) | 593 | |||||||||||
| Other liabilities | 300 | — | 2,389 | — | ||||||||||||
| Accounts payable and accrued liabilities | 3,066 | 2,425 | 13,482 | 7,576 | ||||||||||||
| $ | 4,461 | $ | 551 | $ | (1,302 | ) | $ | 997 | ||||||||
Supplemental cash flow information | ||||||||||||||||
| Capital lease additions | $ | 4,561 | $ | — | $ | 8,301 | $ | — | ||||||||
(additional financial information follows)
| Vitran Q3 2007, 10/23/07 | page 7 of 7 |
Supplementary Segmented Financial Information
(000’s of $U.S.) (Unaudited)
(000’s of $U.S.) (Unaudited)
| For the quarter ended | For the quarter ended | ||||||||||||||||||||||||||||||||||
| Sept. 30, 2007 | Sept. 30, 2006 | ||||||||||||||||||||||||||||||||||
| Inc. from | Inc. from | ||||||||||||||||||||||||||||||||||
| Revenue | Operations | OR% | Revenue | Operations | OR% | ||||||||||||||||||||||||||||||
LTL | 150,283 | 5,687 | 96.2 | LTL | 102,858 | 6,585 | 93.6 | ||||||||||||||||||||||||||||
LOG | 13,690 | 800 | 94.2 | LOG | 10,419 | 929 | 91.1 | ||||||||||||||||||||||||||||
TL | 7,954 | 420 | 94.7 | TL | 8,235 | 354 | 95.7 | ||||||||||||||||||||||||||||
| For the nine months | For the nine months | ||||||||||||||||||||||||||||||||||
| ended Sept. 30, 2007 | ended Sept. 30, 2006 | ||||||||||||||||||||||||||||||||||
| Inc. from | Inc. from | ||||||||||||||||||||||||||||||||||
| Revenue | Operations | OR% | Revenue | Operations | OR% | ||||||||||||||||||||||||||||||
LTL | 437,055 | 20,920 | 95.2 | LTL | 305,494 | 19,692 | 93.6 | ||||||||||||||||||||||||||||
LOG | 34,579 | 1,976 | 94.3 | LOG | 30,082 | 2,081 | 93.1 | ||||||||||||||||||||||||||||
TL | 24,573 | 1,119 | 95.4 | TL | 24,704 | 1,294 | 94.8 | ||||||||||||||||||||||||||||
LTL SEGMENT — Statistical Information
(Unaudited)
(Unaudited)
| Combined LTL (in US$) | LTL Division | Q. vs, Q. % change | ||||||||
3rd Quarter 2007 | ||||||||||
| Revenue ($000’s) | $ | 150,283 | 46.1 | % | ||||||
| No. of Shipments | 1,032,178 | 56.5 | % | |||||||
| Weight (000’s lbs) | 1,529,573 | 45.1 | % | |||||||
| Revenue per shipment | $ | 145.60 | -6.6 | % | ||||||
| Revenue per CWT | $ | 9.83 | 0.7 | % | ||||||
Year-to-date | 9 mo. vs. 9 mo. % change | |||||||||
| Revenue ($000’s) | $ | 437,055 | 43.1 | % | ||||||
| No. of Shipments | 3,071,284 | 52.7 | % | |||||||
| Weight (000’s lbs) | 4,553,748 | 42.4 | % | |||||||
| Revenue per shipment | $ | 142.30 | -6.3 | % | ||||||
| Revenue per CWT | $ | 9.60 | 0.5 | % | ||||||
# # #