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 SECOND-QUARTER RESULTS FOR 2010
SAN MATEO, Calif.-August 4, 2010-Con-way Inc. (NYSE:CNW) today reported net
income to common shareholders for the second quarter of 2010 of $13.9 million
(26 cents per diluted share). The results compared to second-quarter 2009 net
income to common shareholders of $31.5 million (64 cents per diluted share).
Revenue in the second quarter of 2010 was $1.31 billion, a 23.7 percent
increase from last year's second quarter. Operating income in the 2010
second quarter was $35.4 million, compared to $66.0 million in the second
quarter a year ago.
The effective tax rate in the 2010 second quarter was 31.7 percent, compared
to 33.1 percent in the same quarter of last year. Both periods included
discrete tax adjustments that reduced the effective tax rate.
Commenting on the quarter's results, Douglas W. Stotlar, Con-way's president
and CEO, noted that seasonally stronger demand and rebounding economic
activity supported revenue growth in all reporting segments, particularly at
Con-way Freight. "The second quarter saw Con-way Freight's business levels
surge to record volumes, resulting in higher variable operating costs,"
Stotlar noted. "The quarter's results also reflect the effect of wage
increases implemented in January this year and resumption of accruals in
April for paid time off benefits."
Stotlar added that efforts to improve pricing showed modest progress in the
quarter. "Yield each month in the quarter improved sequentially. However,
managing the balance between price and volume while bringing costs into
alignment will take time, which restrains our expectations for near-term
improvement."
Menlo Worldwide Logistics produced another strong quarter. "Menlo's core
warehousing and transportation management operations turned in significant
growth in both revenues and profits," Stotlar noted. "Our global logistics
and supply chain management company continues to do a fine job managing its
costs, creating high-service value for its customers, and delivering
excellent performance. Menlo is on track for another solid year."
In line with its earlier-announced strategy to shift a portion of its assets
away from affiliate company business in favor of external market-based
traffic, Con-way Truckload made significant progress repositioning and
rebalancing its network during the quarter, Stotlar noted. "Our Truckload
team was successful in meeting this strategic objective," he said. "We are
confident that by redeploying some of the fleet at this inflection point in
the demand environment, we will be able to take advantage of higher-margin
traffic as supply continues to tighten."
Stotlar added that spot pricing strength seen in the first quarter has now
begun to show up in longer-term truckload contract pricing, as customers take
steps to ensure access to capacity. "The market fundamentals have changed
dramatically over the past quarter, improving Con-way Truckload's prospects
for the rest of the year," Stotlar said.
Operating results in the 2010 second quarter for Con-way's reporting segments
were as follows:
FREIGHT
For the 2010 second quarter, Con-way Freight, the company's less-than-
truckload (LTL) operation, reported:
* Revenue of $817.0 million, a 25.8 percent increase over last year's
second-quarter revenue of $649.3 million.
* Yield declined 2.1 percent from the previous-year second quarter.
Excluding the fuel surcharge, yield declined 6.4 percent.
* Weight per day increased 29.2 percent over the previous-year second
quarter.
* Operating income of $17.2 million, compared to $49.0 million in the
year-ago period. Results were adversely affected by higher labor,
equipment rental and purchased transportation costs as network volumes
remained at record levels. Also, increased payroll costs from partial
reinstatement of employee wage and benefit reductions taken last year
reduced current-quarter operating income by approximately $15 million.
* Operating ratio of 97.9 in the 2010 second quarter compared to 92.5 in
the previous-year period.
LOGISTICS
For the second quarter of 2010, Menlo Worldwide Logistics, the company's
global logistics and supply chain management operation, reported:
* Revenue of $385.8 million, up 17.8 percent from the prior-year second-
quarter revenue of $327.6 million.
* Net revenue of $142.8 million, which increased 12.1 percent from $127.4
million in the same period of last year.
* Operating income of $13.0 million, a 66.8 percent increase from the $7.8
million earned in the second quarter of 2009.
Both of Menlo's core operations of warehousing and transportation management
services realized year-over-year improvements in revenue, net revenue and
operating income.
TRUCKLOAD
For the second quarter of 2010, Con-way Truckload, the company's full-
truckload transportation operation, reported:
* Revenue of $145.5 million, a 1.5 percent increase from the prior-year
second-quarter revenue of $143.3 million. The increase was attributable
to higher fuel surcharges and improved revenue per loaded mile.
Partially offsetting the increase was the negative effect of lower total
miles in the quarter, which reduced revenue (excluding fuel surcharges),
and a higher proportion of empty miles resulting from fleet
repositioning activities.
* Operating income of $5.1 million compared to the $6.9 million earned in
last year's second quarter. Included in the results was a $7.6 million
increase in vehicular claims expense, resulting from substantially
higher-than-plan expense in the current quarter, compared to a
historically low expense in the prior-year quarter. The previous-year
quarter also included a $2.5 million loss from the sale of tractors and
a $1.0 million write-down related to the 2007 CFI acquisition.
* Operating ratio on revenue, exclusive of fuel surcharges, was 95.7 in
the second quarter of 2010, compared to 94.7 in the second quarter of
2009.
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 break-
even results in the 2010 second quarter compared to prior-year second-quarter
operating income of $2.3 million, which relates primarily to corporate
reinsurance activities.
INVESTOR CONFERENCE CALL
Con-way will host a conference call for the investment community tomorrow,
Thursday, August 5 beginning at 8:30 a.m. Eastern Daylight 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 86656667. 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, multimodal 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, in tangible 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 2009 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.
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Con-way Inc.
Consolidated Statements of Operating Results
(Dollars in thousands except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2010 2009 2010 2009
-------- -------- -------- --------
REVENUE
Freight $ 816,965 649,349 $1,541,968 1,223,164
Logistics [a] 385,775 327,622 740,958 644,099
Truckload 145,454 143,298 286,070 278,081
Other 14,019 4,537 25,858 10,526
Inter-segment Revenue
Eliminations (55,950) (68,473) (126,680) (136,605)
----------- ---------- ---------- ----------
$1,306,263 1,056,333 2,468,174 2,019,265
___________ __________ __________ __________
OPERATING INCOME (LOSS)
Freight $ 17,226 48,994 14,073 25,607
Logistics [b] 13,008 7,799 25,864 12,773
Truckload [c] 5,132 6,879 8,107 (125,799)
Other 66 2,294 1,788 3,073
--------- --------- ---------- ----------
35,432 65,966 49,832 (84,346)
Other Expense, net 15,121 16,581 32,435 32,094
--------- -------- ---------- ----------
Income (Loss) before Income
Tax Provision 20,311 49,385 17,397 (116,440)
Income Tax Provision [d]
6,448 16,346 7,571 2,870
---------- -------- ---------- ----------
Net Income (Loss) 13,863 33,039 9,826 (119,310)
---------- --------- ---------- ----------
Preferred Stock Dividends - 1,572 - 3,189
--------- --------- ---------- ----------
NET INCOME (LOSS) APPLICABLE
TO COMMON SHAREHOLDERS $ 13,863 31,467 9,826 (122,499)
__________ _________ __________ _________
Weighted-Average Common Shares Outstanding
Basic 51,665,047 46,171,511 50,506,809 46,067,761
Diluted 52,362,407 50,778,937 51,184,703 46,067,761
Income (Loss) Per Common Share
Basic
Net Income (Loss) Applicable to
Common Shareholders $ 0.27 $ 0.68 $ 0.19 $(2.66)
--------- -------- --------- --------
Diluted
Net Income (Loss) Applicable to
Common Shareholders $ 0.26 $ 0.64 $ 0.19 $(2.66)
****************************************************
[a] Logistics' net revenue
Revenue $ 385,775 327,622 740,958 644,099
Purchased transportation
expense (242,978) (200,252) (453,912) (391,496)
---------- --------- ---------- ---------
Net revenue $ 142,797 127,370 287,046 252,603
__________ _________ __________ _________
[b] Includes a $2.8 million ($0.04 per share) current-year first-quarter charge
for the write-off of a customer-relationship intangible asset.
[c] Includes a $134.8 million ($2.92 per share) prior-year first-quarter
goodwill impairment charge.
[d] Includes a $2.2 million ($0.04 per share) current-year second-quarter
income-tax benefit associated with the reversal of a portion of Con-way's
accrued liability for uncertain tax positions and a $2.3 million
($0.04 per share) current-year first-quarter tax charge related
to recently enacted health care legislation. The prior year also
includes various discrete tax adjustments that reduced the effective
tax rate.
***************************************
Con-way Inc.
Consolidated Condensed Balance Sheets
(Dollars in thousands)
June 30, 2010 December 31, 2009
ASSETS
Current assets $ 1,157,718 $ 1,076,894
Property, plant
and equipment, net 1,409,784 1,375,273
Other assets 436,051 444,050
------------- ----------------
Total Assets $ 3,003,553 $ 2,896,217
_____________ ________________
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 711,133 $ 791,484
Long-term debt
and capital leases 786,599 760,789
Other long-term
liabilities and
deferred credits 654,617 657,215
Shareholders'
equity 851,204 686,729
------------- ----------------
Total Liabilities and
Shareholders' Equity $ 3,003,553 $ 2,896,217
_____________ ________________