Exhibit 99
CNF
3240 HILLVIEW AVENUE
PALO ALTO, CA 94304-1297
(650) 494-2900
NEWS RELEASE
Contacts:
Media - James R. Allen
(650) 813-5335
Investors - Patrick Fossenier
(650) 813 -5353
CNF INC. INCOME FROM CONTINUING OPERATIONS
CLIMBS 42 PERCENT IN FIRST QUARTER 2005
PALO ALTO, California - April 20, 2005 - CNF Inc. (NYSE:CNF) today
reported first-quarter 2005 after-tax income from continuing operations of
$38.9 million (after preferred stock dividends), or 69 cents per diluted
share, up 42 percent. This compares with first-quarter 2004 after-tax income
from continuing operations of $27.4 million, or 50 cents per diluted share.
Operating income in the first quarter was $73.3 million, up 32 percent from
$55.4 million in the same quarter a year ago. Revenue for the first quarter
of 2005 was $947.7 million, up 12 percent from $846.9 million in first-
quarter 2004.
Net income in the first quarter for common shareholders was $29.1 million, or
52 cents per diluted share, up 19 percent. This compares with net income for
common stock shareholders of $24.4 million, or 45 cents per diluted share in
the first quarter a year ago. Net income for common shareholders included a
$9.8 million loss (17 cents per diluted share) from the discontinued
operations of Menlo Worldwide Forwarding, which was sold in December 2004.
The sale is recognized as discontinued operations and prior periods have been
restated. Charges from the disposition of Forwarding to date total $286
million, which includes the $9.8 million in the first quarter of 2005.
Commenting on the quarterly results and operations, W. Keith Kennedy,
chairman and interim chief executive officer, said, "Con-Way increased
earnings by more than 30 percent, primarily from less-than-truckload (LTL)
growth across all regions of North America. Productivity, cost controls and
customer service all excelled in the quarter for Con-Way. Our logistics
services provider, Menlo Worldwide, also had a good quarter with earnings up
almost 15 percent."
The company said it had repurchased $32 million in company stock in the first
quarter as part of a previously announced $300 million stock repurchase
program to occur over the next two years. The company said it expects to
repurchase approximately $40 million in shares in the second quarter of 2005.
CON-WAY TRANSPORTATION SERVICES
For the first quarter of 2005, Con-Way Transportation Services reported:
- Operating income of $62.9 million, up 31 percent from $47.9 million in
the year- ago period.
- Revenue of $659.4 million, an increase of 11 percent from last year's
first-quarter revenue of $593.9 million.
- Regional carrier yield increased 5 percent from the prior-year quarter.
- The regional carrier group achieved an improved operating ratio of 89.5
percent compared to 91 percent in the first quarter of 2004.
MENLO WORLDWIDE
CNF's Menlo Worldwide operations include the results for Menlo Logistics and
Vector SCM. For the first quarter of 2005, Menlo Worldwide reported:
- Total segment operating income of $9.7 million, up 15 percent, compared
with $8.4 million in the first quarter of 2004.
- Menlo Logistics' revenue of $282.9 million, up 12 percent from the
prior-year quarter of $252.8 million.
- Operating income for Menlo Logistics was $5.7 million in the first
quarter, down 6 percent from $6.0 million in the first quarter of 2004.
- Operating income at Vector SCM was $4.0 million in the first quarter, up
69 percent from $2.4 million in the prior-year quarter.
OTHER
CNF's "other" operations, which includes the results of Road Systems trailer
manufacturing and corporate activities, reported an operating profit of
$635,000 compared to a loss $852,000 in the first quarter of 2004.
The effective tax rate in the first quarter of 2005 was 38 percent, compared
to 39 percent in the first quarter of 2004.
SECOND-QUARTER 2005 OUTLOOK
Second-quarter 2005 diluted earnings per share from continuing operations are
expected to be between 92 cents and $1.00. This compares with 61 cents per
diluted share earned from continuing operations in the second quarter of
2004. CNF's tax rate is expected to be 39 percent in the second quarter.
CONFERENCE CALL
CNF will host a conference call for shareholders and the investment community
to discuss first quarter results at 11 a.m. Eastern Daylight Time (8 a.m.
PDT) on Thursday, April 21. The call can be accessed by dialing (866) 264-
3634 or (706) 643-3632 (for international callers) and is expected to last
approximately one hour. Callers are requested to dial in at least five
minutes before the start of the call. Related financial and operating
statistics to be discussed on the conference call are available on the
company's website at www.cnf.com/investor relations/fin hilight.asp. The call
will also be available through a live web cast at the investor relations
section of the CNF web site www.cnf.com and at www.streetevents.com. An audio
replay will be available for one week following the call at (800) 642-1687 or
(706) 645-9291 (for international callers), using access code 4697886. The
replay will also be available for one week on demand at the same web casting
sites providing access to the live call.
CNF is a $3.7 billion management company of supply chain service providers.
It has businesses in less-than-truckload motor carriage, truckload carriage,
air freight, logistics and supply chain management and trailer manufacturing.
Forward-Looking Statements
Certain statements in this press release constitute "forward-looking
statements" and are subject to a number of risks and uncertainties and should
not be relied upon as predictions of future events. All statements other than
statements of historical fact are forward-looking statements, including any
projections and objectives of management for future operations, any
statements concerning proposed new products or services, any statements
regarding CNF's estimated future contributions to pension plans, any
statements as to the adequacy of reserves, any statements regarding the
outcome of any claims that may be brought against CNF, any statements
regarding future economic conditions or performance, any statements of
estimates or belief and any statements or assumptions underlying the
foregoing. Specific factors that could cause actual results and other matters
to differ materially from those discussed in such forward-looking statements
include: changes in general business and economic conditions, the
creditworthiness of CNF's customers and their ability to pay for services
rendered, increasing competition and pricing pressure, changes in fuel
prices, the effects of the cessation of the air carrier operations of Emery
Worldwide Airlines, the possibility that CNF may, from time to time, be
required to record impairment charges for long-lived assets, the possibility
of defaults under CNF's $400 million credit agreement and other debt
instruments (including defaults resulting from additional unusual charges),
and the possibility that CNF may be required to repay certain indebtedness in
the event that the ratings assigned to its long-term senior debt by credit
rating agencies are reduced, labor matters, enforcement of and changes in
governmental regulations, environmental and tax matters, matters relating to
CNF's 1996 spin-off of Consolidated Freightways Corporation (CFC), including
the possibility that CFC's multi-employer pension plans may assert claims
against CNF, matters relating to the sale of Menlo Worldwide Forwarding,
Inc., including CNF's obligation to indemnify the buyer for certain losses in
connection the sale, and matters relating to CNF's defined benefit pension
plans. The factors included herein and in Item 7 of CNF's 2004 Annual Report
on Form 10-K as well as other filings with the Securities and Exchange
Commission could cause actual results and other matters to differ materially
from those in such forward-looking statements. As a result, no assurance can
be given as to future financial condition, cash flows, or results of
operations.
CNF INC.
STATEMENTS OF CONSOLIDATED INCOME
(Dollars in thousands except per share amounts)
Three Months Ended
March 31,
-------------------------
2005 2004
----------- -----------
REVENUES $947,683 $846,920
Costs and Expenses
Operating expenses 768,733 691,817
Selling, general and
administrative expenses 79,226 74,445
Depreciation 26,468 25,210
----------- -----------
874,427 791,472
----------- -----------
OPERATING INCOME 73,256 55,448
Other Expense, net (7,443) (7,177)
----------- -----------
Income Before Taxes 65,813 48,271
Income Tax Provision 24,962 18,826
----------- -----------
Income from Continuing Operations 40,851 29,445
----------- -----------
Discontinued Operations, net of tax
Loss from Disposal (9,776) -
Loss from Discontinued Operations - (3,016)
----------- -----------
(9,776) (3,016)
Net Income 31,075 26,429
Preferred Stock Dividends 1,989 2,022
----------- -----------
NET INCOME AVAILABLE TO
COMMON SHAREHOLDERS $29,086 $24,407
=========== ===========
Weighted-Average Common
Shares Outstanding
Basic 52,348,984 49,835,663
Diluted [a] 56,610,719 57,125,185
Earnings (Loss) Per Common Share
Basic
Net income from
Continuing Operations $0.74 $0.55
Loss from Disposal, net of tax (0.18) -
Loss from Discontinued
Operations, net of tax - (0.06)
----------- -----------
$0.56 $0.49
=========== ===========
Diluted [a]
Net income from
Continuing Operations $0.69 $0.50
Loss from Disposal, net of tax (0.17) -
Loss from Discontinued
Operations, net of tax - (0.05)
----------- -----------
$0.52 $0.45
=========== ===========
OPERATING SEGMENTS
REVENUES
Con-Way Transportation Services $659,373 $593,876
Menlo Worldwide Logistics 282,901 252,790
CNF Other 5,409 254
----------- -----------
$947,683 $846,920
=========== ===========
OPERATING INCOME (LOSS)
Con-Way Transportation Services $62,933 $47,866
Menlo Worldwide
Logistics 5,653 6,042
Vector 4,035 2,392
----------- -----------
9,688 8,434
----------- -----------
CNF Other 635 (852)
----------- -----------
$73,256 $55,448
=========== ===========
[a] The three months ended March 31, 2005 include the dilutive effect
of restricted stock, stock options and Series B preferred stock.
The prior year also includes the dilutive effect of convertible
subordinated debentures, which were redeemed on June 1, 2004.
CNF INC.
CONDENSED BALANCE SHEETS
(Dollars in thousands)
March 31, December 31,
2005 2004
----------- -----------
ASSETS
Current assets $1,486,668 $1,509,767
Current assets of discontinued
operations 5,128 5,128
Property, plant and
equipment, net 859,718 859,321
Other assets 89,242 106,965
Non-current assets of
discontinued operations 14,777 15,220
----------- -----------
Total Assets $2,455,533 $2,496,401
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $643,397 $678,126
Current liabilities of
discontinued operations 23,446 34,705
Long-term debt and guarantees 585,148 601,344
Other long-term liabilities and
deferred credits 403,515 397,997
Long-term liabilities of
discontinued operations 2,666 6,862
Shareholders' equity 797,361 777,367
----------- -----------
Total Liabilities and
Shareholders' Equity $2,455,533 $2,496,401
=========== ===========