EXHIBIT 99
CON-WAY INC.
NEWS RELEASE
Contacts:
Investor: Patrick Fossenier 1+650-378-5353
News Media: Gary Frantz 1+650-378-5335
CON-WAY INC. REPORTS FOURTH-QUARTER AND FULL-YEAR RESULTS FOR 2009
SAN MATEO, Calif.-Feb. 4, 2010-Con-way Inc. (NYSE:CNW) today reported a net
loss applicable to common shareholders for the fourth quarter of 2009 of $1.9
million, or 4 cents per share. The results compare to a fourth quarter 2008
net loss to common shareholders of $43.0 million, or 94 cents per share.
The net loss to common shareholders in the fourth quarter of 2009 included
expenses related to an administrative outsourcing initiative (4 cents per
share) while last year's fourth quarter included operational restructuring
costs at Con-way Freight (28 cents per diluted share), impairment and
acquisition related charges at Menlo Worldwide Logistics (91 cents per
diluted share), and a net gain from discontinued operations (15 cents per
diluted share).
Revenue for the 2009 fourth quarter of $1.12 billion was essentially even
with last year's fourth quarter. Operating income in the 2009 fourth quarter
was $17.3 million compared to an operating loss of $35.2 million in the
fourth quarter a year ago, primarily reflecting the prior year operating
losses associated with the special items described above. Excluding these
special items, declines in operating income at Con-way Freight and Con-way
Truckload were partially offset by improved operating income at Menlo
Worldwide Logistics.
In the fourth quarter of 2009, income tax expense of $3.1 million was
recognized on $1.1 million of income before taxes, reflecting changes in
numerous permanent tax items. In the fourth quarter of 2008, an income tax
benefit of $1.6 million was reported on $49.6 million of loss before taxes,
primarily reflecting no tax deduction on the impairment and acquisition-
related charges and the effect of discrete items.
FULL-YEAR 2009 RESULTS
For the full-year 2009, Con-way reported a net loss applicable to common
shareholders of $110.9 million, or $2.33 per share. This compares to full-
year 2008 net income to common shareholders of $67.0 million, or $1.40 per
diluted share.
Results for full-year 2009 included the earlier mentioned administrative
outsourcing expenses (4 cents per share), a first quarter goodwill impairment
charge at Con-way Truckload ($2.83 per share) and a third quarter charge for
a change in Con-way Freight's accounting estimate for revenue adjustments (7
cents per share). The 2008 full-year period included the impairment and
acquisition related charges noted previously (84 cents per diluted share),
two operational restructuring charges at Con-way Freight (33 cents per
diluted share) and a gain from discontinued operations (17 cents per diluted
share).
Revenues for the full-year 2009 declined to $4.27 billion from $5.04 billion
in 2008, primarily reflecting the effect of weak pricing driven by surplus
trucking industry capacity. The operating loss of $25.9 million for 2009
compares to operating income in 2008 of $192.6 million, with both periods
affected by the special items described above. Excluding these special
items, declines in operating income at Con-way Freight and Con-way Truckload
were partially offset by improved operating income at Menlo Worldwide
Logistics.
In 2009, income tax expense of $17.5 million was recognized on $90.3 million
of loss before taxes and, in 2008, income tax expense of $69.5 million was
reported on $134.9 million of income before taxes. Both periods primarily
reflect no tax deduction on impairment charges and the effect of discrete
items.
Commenting on the results, Con-way President and CEO Douglas W. Stotlar said,
"Excess capacity remains a problem for the LTL and truckload markets which
continues to suppress profit recovery. It will be incumbent upon us to
maintain strong liquidity and vigilant cost control while we invest prudently
for the strategic needs of our business and customers going forward."
Con-way Freight, the company's less-than-truckload operation, saw pricing
stabilize somewhat in the fourth quarter, albeit at a lower level. "While
yields were down compared to last year, our increased tonnage levels have
enabled better utilization of rolling stock capacity," Stotlar noted. "With
the LTL market's persistent over-supply, opportunities to improve margin will
be difficult." Stotlar added that Con-way Freight will continue to refine
its network to drive cost savings and service improvements, through
initiatives such as the line-haul re-engineering announced last month which
accelerated transit times for 460 U.S. cities while reducing operating
expense.
Menlo Worldwide Logistics culminated the year with a solid fourth quarter
performance. "2009 was an excellent year for Menlo," Stotlar noted. "Menlo's
service portfolio and solution approach clearly were on target with customer
demand as the company grew both new and existing customer business in 2009.
That success coupled with operational improvements and efficiency gains
provided a strong finish for the year and positions Menlo with good momentum
heading into 2010."
Con-way Truckload weathered difficult market conditions to turn in a
commendable performance for the quarter. "Our truckload company benefited
from several strategic decisions that have improved asset utilization and
strengthened its position as a premium service provider," Stotlar said. "Its
expansion into regional operations is showing good early returns. We
continue to see capacity being rationalized in the truckload industry. Early
bid activity in January shows prices firming and demand strengthening. Those
are encouraging signals that a recovery is beginning to take hold in this
market segment," he concluded.
Segment results in the 2009 fourth quarter for Con-way's principal operations
were as follows:
FREIGHT
For the 2009 fourth quarter, Con-way Freight, the company's less-than-
truckload operation, reported:
* Operating income of $2.8 million compared to an operating loss of $9.4
million in the year-ago period. Results were adversely affected by $2.6
million of costs for the administrative outsourcing initiative, and from
continued weak LTL industry pricing, but benefited from employee-related
cost saving initiatives implemented earlier in the year. Operating
income in the same period of 2008 was lower due to $21.3 million of
operational restructuring charges.
* Revenue of $683.9 million, a 6.8 percent increase over last year's
fourth quarter revenue of $640.3 million.
* Tonnage per day increased 20.6 percent over the previous year fourth
quarter.
* Yield declined 14.4 percent from the previous year fourth quarter,
primarily reflecting the supply/demand imbalance and the resulting
impact on pricing. Excluding the fuel surcharge, yield declined 11.7
percent.
* Operating ratio was 99.6 in the 2009 fourth quarter compared to 101.4 in
the previous year period. Excluding the operational restructuring
charges in the 2008 fourth quarter, the operating ratio for this period
was 98.2.
LOGISTICS
For the fourth quarter of 2009, Menlo Worldwide Logistics, the company's
global logistics and supply chain management operations, reported:
* Operating income of $5.9 million compared to an operating loss of $38.6
million in the fourth quarter of 2008. The 2008 period included $42.7
million for impairment and acquisition related charges.
* Revenue of $338.2 million, down 9.4 percent from the prior year fourth
quarter revenue of $373.1 million. The decrease primarily reflects
lower transportation management revenues.
* Net revenue of $133.1 million, a 2.9 percent increase from $129.3
million in the previous year fourth quarter. The increase primarily
reflects higher net revenue from warehouse management services.
TRUCKLOAD
For the fourth quarter of 2009, Con-way Truckload, the company's full-
truckload transportation operation, reported:
* Operating income of $8.2 million, a decrease of 43.3 percent compared to
$14.5 million in the previous year period, primarily reflecting lower
recovery of fuel surcharge revenue and weaker pricing due to excess
industry capacity during the quarter.
* Revenue of $93.6 million, after the elimination of $46.1 million in
inter-company revenues. This compares to 2008 fourth quarter revenue of
$110.9 million (after elimination of $38.4 million in inter-company
revenues) and reflects lower fuel surcharge recovery and the ongoing
effects of the competitive pricing environment experienced throughout
the year.
* Operating ratio before inter-company eliminations and exclusive of fuel
surcharges was 93.2, compared to 88.1 in the fourth quarter of 2008.
CON-WAY OTHER
Con-way Other includes the company's Road Systems, Inc. trailer manufacturing
unit as well as other corporate activities. These activities produced a small
amount of income in the 2009 fourth quarter compared to a $1.7 million loss
in the previous-year period.
INVESTOR CONFERENCE CALL
Con-way will host a conference call for the investment community tomorrow,
Friday, February 5 beginning at 8:30 a.m. Eastern Standard Time (5:30 a.m.
Pacific).
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. The call will also be available through a live internet webcast
at www.con-way.com, in the investor relations section.
An audio replay will be available for two weeks following the call by dialing
(800) 642-1687 or (706) 645-9291 (for international callers) and using access
code 48324685. An Internet replay of the presentation will also be available
at the Con-way website.
About Con-way -- Con-way Inc. (NYSE:CNW) is a $4.3 billion freight
transportation and logistics services company headquartered in San Mateo,
Calif. A diversified transportation company, Con-way delivers industry-
leading services through three primary operating companies: Con-way Freight,
Con-way Truckload and Menlo Worldwide Logistics. These operating units
provide high-performance, day-definite less-than-truckload and full truckload
freight transportation, as well as logistics, warehousing and supply chain
management services, and trailer manufacturing. Con-way Inc. and its
subsidiaries operate from more than 500 locations across North America and in
20 countries. For more information about Con-way, visit us on the Web at
www.con-way.com.
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 of earnings, revenues, weight, yield, volumes, income or other
financial or operating items, all statements of the plans, strategies,
expectations or objectives of Con-way's management for future operations or
other future items, any statements concerning proposed new products or
services, any statements regarding Con-way's estimated future contributions
to pension plans, any statements as to the adequacy of reserves, any
statements regarding the outcome of any legal and other claims and
proceedings that may be brought against Con-way, any statements regarding
future economic conditions or performance, any statements regarding strategic
acquisitions, 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, increasing competition and pricing pressure, the
creditworthiness of Con-way's customers and their ability to pay for services
rendered, changes in fuel prices or fuel surcharges, the possibility that
Con-way may, from time to time, be required to record impairment charges for
goodwill, intangible assets and other long-lived assets, the possibility of
defaults under Con-way's $400 million credit agreement and other debt
instruments (including without limitation defaults resulting from unusual
charges), uncertainty in the credit markets, including the effect on Con-
way's ability to refinance indebtedness as and when it becomes due, labor
matters, enforcement of and changes in governmental regulations or
legislation which potentially could result in an adverse impact on the
company, environmental and tax matters, and matters relating to Con-way's
defined benefit pension plans, including the effect on the plans of changes
in discount rates and in the value of plan assets. The factors included
herein and in Item 7 of Con-way's 2008 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.
Con-way Inc.
Consolidated Statements of Operating Results
(Dollars in thousands except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
--------------------- ----------------------
2009 2008 2009 2008
-------- -------- --------- ---------
REVENUES
Freight $ 683,866 640,305 2,574,300[b] 3,015,959
Logistics [a] 338,220 373,117 1,326,013 1,511,611
Truckload 93,632 110,937 365,122 505,201
Other 815 1,023 3,804 4,046
---------- -------- ---------- ---------
$1,116,533 1,125,382 4,269,239 5,036,817
__________ ________ __________ _________
OPERATING INCOME (LOSS)
Freight $ 2,835 (9,390)[c] 51,258 [b] 165,169 [c]
Logistics 5,923 (38,578)[d] 28,228 (23,683)[d]
Truckload 8,208 14,488 (106,971)[e] 52,395
Other 318 (1,683) 1,557 (1,259)
--------- -------- ---------- ---------
17,284 (35,163) (25,928) 192,622
Other Expense, net 16,137 14,458 64,341 57,705
--------- -------- ---------- ---------
Income (Loss) before Income Tax Provision (Benefit)
Income Tax Provision 1,147 (49,621) (90,269) 134,917
[Benefit] 3,076 (1,642) 17,478 69,494
--------- -------- ---------- ---------
Income (Loss) from
Continuing Operations (1,929) (47,979) (107,747) 65,423
--------- -------- ---------- ---------
Discontinued Operations, net of tax
Gain from Disposal - 6,717 - 8,326
--------- -------- ---------- ---------
- 6,717 - 8,326
Net Income (Loss) (1,929) (41,262) (107,747) 73,749
Preferred Stock
Dividends - 1,760 3,189 6,788
--------- -------- ---------- ---------
NET INCOME (LOSS) APPLICABLE TO
COMMON SHAREHOLDERS $ (1,929) (43,022) (110,936) 66,961
__________ ________ __________ _________
NET INCOME (LOSS) FROM CONTINUING
OPERATIONS APPLICABLE TO
COMMON SHAREHOLDERS $ (1,929) (49,739) (110,936) 58,635
__________ ________ __________ _________
Weighted-Average Common Shares Outstanding
Basic 49,057,690 45,605,592 47,525,862 45,427,317
Diluted 49,057,690 45,605,592 47,525,862 48,619,292
Earnings (Loss) Per Common Share
Basic
Net Income (Loss)
from Continuing
Operations $ (0.04) $(1.09) $ (2.33) $ 1.29
Gain from Disposal - 0.15 - 0.18
--------- -------- ---------- --------
$ (0.04) $(0.94) $ (2.33) $ 1.47
__________ ________ __________ ________
Diluted
Net Income (Loss)
from Continuing
Operations $ (0.04) $(1.09) $ (2.33) $ 1.23
Gain from Disposal - 0.15 - 0.17
--------- -------- ---------- --------
$ (0.04) $(0.94) $ (2.33) $ 1.40
__________ ________ __________ ________
****************************************************
[a] Logistics' net revenues
Revenues $ 338,220 373,117 1,326,013 1,511,611
Purchased Transportation
Expense (205,168) (243,852) (811,712) (1,001,775)
---------- -------- ---------- ---------
Net revenues $ 133,052 129,265 514,301 509,836
__________ ________ __________ _________
[b] The twelve months ended December 31, 2009 include a change in
accounting estimate, which increased the allowance for revenue
adjustments and decreased both revenue and operating income
by $5.4 million ($0.07 per diluted share).
[c] The three and twelve months ended December 31, 2008 included expense
associated with restructuring activities of $21.3 million ($0.28 per
diluted share) and $26.5 million ($0.33 per diluted share), respectively.
[d] The three and twelve months ended December 31, 2008 include
four-quarter charges of $31.8 million ($0.70 and $0.65 per diluted
share, respectively) for goodwill impairment, $6.0 million ($0.10
and $0.09 per diluted share, respectively) for the impairment of a
customer-relationship intangible asset and $4.9 million ($0.11 and
$.10 per diluted share, respectively) for the write-down of an
acquisition-related receivable.
[e] The twelve month ended December 31, 2009 include a goodwill impairment
charge of $134.8 million ($2.83 per share).
Con-way Inc.
Consolidated Condensed Balance Sheets
(Dollars in thousands)
ASSETS December 31, 2009 December 31, 2008
Current assets $ 1,076,894 $ 951,082
Property, plant
and equipment, net 1,375,273 1,471,956
Other assets 444,050 648,669
------------- ----------------
Total Assets $ 2,896,217 $ 3,071,707
_____________ ________________
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 791,484 $ 658,077
Long-term debt, guarentees
and capital leases 760,789 926,224
Other long-term
liabilities and
deferred credits 657,215 861,814
Shareholders'
equity [a] 686,729 625,592
------------- ----------------
Total Liabilities and
Shareholders' Equity $ 2,896,217 $ 3,071,707
_____________ ________________
[a] Shareholders' equity includes net-of-tax adjustments to recognize
the funded status of Con-way's defined benefit pension and postretirement
plans. The accumulated other comprehensive losses associated with
these net-of-tax adjustments were $235.7 million at December 31, 2009
and $372.4 million at December 31, 2008.