Richard Gaetz, President/CEO Sean Washchuk, VP Finance/CFO Vitran Corporation Inc. 416/596-7664
Robert Rinderman Jaffoni & Collins Incorporated 212/835-8500 or VTNC@jcir.com
VITRAN REPORTS RECORD DILUTED EPS OF $0.42 IN 2005 Q3 ON 20 PERCENT INCREASE IN REVENUE
- Earnings Increase Streak Continues at 16 Straight Quarters -
TORONTO, ONTARIO (October 20, 2005) – Vitran Corporation Inc. (NASDAQ: VTNC, TSX: VTN), a North American transportation and logistics firm, today announced record quarterly financial results for the 2005 third quarter ended September 30, 2005 (all figures reported in $U.S.).
For the quarter, Vitran posted all-time records for net income of $5.4 million, earnings per diluted share of $0.42 and revenue of $116.2 million. In the comparable three-month period in the prior year, Vitran recorded net income of $4.5 million, or $0.36 per diluted share, on revenue of $97.0 million.
Vitran President and Chief Executive Officer Rick Gaetz, stated, “With the first full quarter following the closing of our Chris Truck Line (CTL) acquisition, we are delighted to report another period of record operating results, our 16th consecutive quarter with year-over-year earnings improvement. Importantly, CTL met our expectations and contributed to our improved LTL segment operating ratio.
“Although Vitran’s 2005 Q3 results were an all-time record, our reported results for the quarter would have been even better had it not been for the negative impact of both a prolonged strike at the Port of Vancouver, that was eventually resolved in mid-August, and two third quarter accidents that took place at our Truckload Segment.”
At September 30, 2005, the Company had $10.9 million in cash on hand and an additional $24.6 million of available credit as it continues to seek additional accretive acquisitions in the U.S. that will further expand Vitran’s growing North American presence.
For the nine-month period ended September 30, 2005, Vitran achieved net income of $12.9 million, or $1.01 per diluted share, on revenue of $315.2 million. In the year earlier period, the Company reported net income of $10.6 million, or $0.83 per diluted share, on revenue of $278.1 million.
1
Segmented Results Income from operations at Vitran’s LTL (less-than-truckload) segment rose 31 percent during the 2005 third quarter to $7.7 million, led by a 27 percent revenue increase at the U.S. LTL business unit – buoyed by the CTL acquisition – and eight percent higher revenue from the Canadian business unit. The LTL segment’s consolidated OR (operating ratio) improved 50 basis points to 92.0, compared to 92.5 in the year-ago quarter. During the period, yields continued to show improvement at both the U.S. and Canadian LTL units. Vitran’s U.S. LTL business unit achieved an eight percent increase in revenue per shipment, and a 10 percent quarter over prior year quarter improvement in revenue per hundredweight. Its Canadian LTL business unit posted a 15 percent increase in revenue per shipment and revenue per hundredweight rose approximately 10 percent.
Vitran’s Logistics segment recorded 49 percent higher income from operations and an OR improvement to 94.8 in the 2005 third quarter, versus 95.9 in the prior year quarter. The Truckload segment had operating income of $0.4 million on revenue of $8.9 million during the three-month period.
Guidance Update Vitran management maintained its 2005 diluted earnings per share guidance of $1.35 to $1.47.
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.
Statements in the press release regarding management’s future expectation, beliefs, goals, plans, or prospects constitute forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. For this purpose, any statements that are contained herein that are not statements or historical fact may be deemed to be forward-looking statements made pursuant to the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, the words “believes”, “anticipates”, “plans” “intends”, “will”, “should”, ”expects”, “projects”, and similar expressions are intended to identify forward-looking statements. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause actual result, future circumstances or events to differ materially from those projected in the forward-looking statements. These risks include, but are not limited to, economic factors, demand for the Company’s services, fuel price fluctuations, the availability of employee drivers and independent contractors, risks associated with geographic expansion, capital requirements, claims exposure and insurance costs, competition, government regulation changes, environmental hazards and other risks detailed from time-to-time in the Company’s public disclosure documents or other filing with the Canadian and United States securities commissions or other securities regulatory bodies. The forward-looking statements are made as of the date hereof, and the Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
(tables follow)
VITRAN CORPORATION INC. CONSOLIDATED BALANCE SHEETS (in thousands of United States dollars)
Sept. 30, 2005
Dec. 31, 2004
Assets
(Unaudited)
Current assets:
Cash and cash equivalents
$
10,809
$
7,375
Marketable securities
—
33,087
Accounts receivable
52,885
40,124
Inventory, deposits and prepaid expenses
7,354
5,924
Future income tax assets
1,675
3,667
72,723
90,177
Capital assets
63,683
37,563
Goodwill
63,990
45,304
$
200,396
$
173,044
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable & accrued liabilities
$
42,333
$
33,377
Income and other taxes payable
750
2,399
Current portion of long-term debt
5,283
3,030
48,366
38,806
Long-term debt
12,622
11,507
Future income tax liabilities
4,847
3,546
Shareholders’ equity:
Common shares
63,361
60,798
Contributed surplus
797
323
Retained earnings
67,298
54,972
Cumulative translation adjustment
3,105
3,092
134,561
119,185
$
200,396
$
173,044
(Statements of Income follows)
2
VITRAN CORPORATION INC. CONSOLIDATED STATEMENTS OF INCOME (unaudited) (in thousands of $U.S., except share and per share amounts)
Three Months
Three Months
Nine Months
Nine Months
Ended September 30,
Ended September 30,
Ended September 30,
Ended September 30,
2005
2004
2005
2004
Revenues
$
116,226
$
96,995
$
315,217
$
278,072
Operating expenses
96,061
82,269
262,947
236,508
Selling, general and administrative
expenses
10,399
7,267
29,011
23,631
Other income
-6
-29
-33
-142
106,454
89,507
291,925
259,997
Income from operations before
depreciation
9,772
7,488
23,292
18,075
Depreciation expense
1,954
1,295
4,802
3,835
Income from operations before undernoted
7,818
6,193
18,490
14,240
Interest expense, net
171
7
209
87
Income from operations before income taxes
7,647
6,186
18,281
14,153
Income taxes
2,271
1,644
5,355
3,575
Net income
$
5,376
$
4,542
$
12,926
$
10,578
Earnings per share:
Basic
$
0.43
$
0.37
$
1.04
$
0.86
Diluted
$
0.42
$
0.36
$
1.01
$
0.83
Weighted average number of shares
Basic
12,584,358
12,339,956
12,481,840
12,241,013
Diluted
12,921,695
12,774,744
12,819,872
12,730,065
(Statement of Cash Flows follows)
3
VITRAN CORPORATION INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (In thousands of United States dollars)
Three months
Three months
Nine months
Nine months
Ended
Ended
Ended
Ended
Sept. 30, 2005
Sept. 30, 2004
Sept. 30, 2005
Sept. 30, 2004
Cash provided by (used in):
Operations:
Net income
$
5,376
$
4,542
$
12,926
$
10,578
Items not involving cash from operations:
Depreciation expense
1,954
1,295
4,802
3,835
Future income taxes
2,030
1,726
2,677
1,557
Stock based compensation expense
181
119
474
177
Gain on sale of capital assets
(6
)
(29
)
(33
)
(142
)
9,535
7,653
20,846
16,005
Change in non-cash working capital components
(3,961
)
(480
)
(6,658
)
(7,221
)
5,574
7,173
14,188
8,784
Investing:
Purchase of capital assets
(10,806
)
(915
)
(17,651
)
(3,993
)
Proceeds on sale of capital assets
50
28
88
242
(28,192
)
Acquisition of subsidiary
(1,693
)
—
—
—
Marketable securities
3,193
(148
)
31,974
(439
)
(9,256
)
(1,035
)
(13,781
)
(4,190
)
Financing:
Revolving credit facility
5,074
—
5,074
—
Repayment of long-term debt
(570
)
(2,169
)
(1,710
)
(6,146
)
Issue of Common Shares upon exercise of stock options
18
503
60
1,402
Repurchase of Common Shares
(65
)
—
(921
)
—
4,457
(1,666
)
2,503
(4,744
)
Effect of translation adjustment on cash
498
63
524
229
Increase (decrease) in cash position
1,273
4,535
3,434
79
Cash position, beginning of period
9,536
7,961
7,375
12,417
Cash position, end of period
$
10,809
$
12,496
$
10,809
$
12,496
Change in non-cash working capital components:
Accounts receivable
$
(5,886
)
$
(2,343
)
$
(9,717
)
$
(9,179
)
Inventory, deposits and prepaid expenses
534
(1,077
)
(921
)
(393
)
Income and other taxes recoverable/payable
(1,565
)
(1,019
)
(1,649
)
(1,078
)
Accounts payable and accrued liabilities
2,956
3,959
5,629
3,429
$
(3,961
)
$
(480
)
$
(6,658
)
$
(7,221
)
(additional financial information follows)
4
LTL Statistical Information — U.S. and CDN Divisions
For the quarter ended September 30, 2005
U.S. LTL
Q. over Q.
CDN LTL
Q. over Q.
($U.S.) Division
% Change ($CDN)
Division
% Change
Revenue (000’s)
$
56,824
26.7
Revenue (000's)
$
47,350
7.6
No. of Shipments
459,192
17.3
No. of Shipments
221,415
(6.4
)
Weight (000’s lbs)
640,602
14.9
Weight (000's lbs)
434,082
(1.9
)
Revenue per shipment
$
123.76
8.0
Revenue per shipment
$
213.85
15.0
Revenue per CWT
$
8.87
10.2
Revenue per CWT
$
10.91
9.6
For the nine months ended
September 30,2005
U.S. LTL
Yr. over Yr.
CDN LTL
Yr. over Yr.
($U.S.)
Division
% Change
($CDN)
Division
% Change
Revenue (000’s)
$
149,460
15.1
Revenue (000's)
$
133,808
6.1
No. of Shipments
1,250,312
9.6
No. of Shipments
645,642
(6.4
)
Weight (000’s lbs)
1,743,199
5.8
Weight (000's lbs)
1,260,687
(4.5
)
Revenue per shipment
$
119.54
5.1
Revenue per shipment
$
207.25
13.4
Revenue per CWT
$
8.62
8.8
Revenue per CWT
$
10.61
11.1
Supplementary Segmented Financial Information (000’s of $U.S.)
For the quarter
For the quarter
ended September 30,
ended September 30,
2005
2004
Revenue
Inc. from
OR%
Revenue
Inc. from
OR%
—
Operations
—
—
Operations
—
LTL
96,658
7,734
92.0
LTL
78,727
5,895
92.5
LOG
10,652
551
94.8
LOG
8,936
370
95.9
TL
8,916
441
95.1
TL
9,332
565
93.9
For the nine
For the nine months
months ended Sept.
ended Sept. 30,
30, 2005
2004
Revenue
Inc. from
OR%
Revenue
Inc. from
OR%
—
Operations
—
—
Operations
—
LTL
259,191
17,620
93.2
LTL
224,943
13,459
94.0
LOG
29,144
1,531
94.7
LOG
25,872
1,142
95.6
TL
26,882
1,901
92.9
TL
27,527
1,500
94.5
# # #
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