Exhibit 7.3 - Pro Forma Financial Information
(in thousands, except shares)
Unaudited Unaudited
Transit Carolina Service Capitol Pro Forma Pro Forma
Group, Inc. Pacific Express Warehouse Adjustments Combined
Current assets $ 284 $ 973 $ 792 $ 1,668 $ $ 3,717
Property and equipment 4 1,787 1,243 12,896 730 (b) 16,660
Goodwill 16,490 (c) 16,490
Other noncurrent assets 6,764 68 6,832
----------- -------- ------- --------- ---------- ----------
Total assets $ 7,052 $ 2,760 $ 2,035 $ 14,632 $ 17,220 $ 43,699
Current debt $ - $ 711 $ 516 $ 3,734 $ - (b) $ 4,961
Other current liabilities 12,887 407 152 1,900 15,346
Long-term debt 1,441 417 7,549 3,700 (c) 13,637
530 (b)
----------- -------- ------- --------- ----------- ----------
Total liabilities 12,887 2,559 1,085 13,183 4,230 33,944
Stockholder's equity (deficit) (5,835) 201 950 1,449 12,990 (c) 9,755
----------- -------- ------- --------- ----------- ----------
Total Liabilities &
stockholder's equity $ 7,052 $ 2,760 $ 2,035 $ 14,632 $ 17,220 $ 43,699
=========== ======== ======= ========= =========== ==========
For the six months ended June 30, 1997
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(in thousands, except shares)
Unaudited Unaudited
Transit Carolina Service Capitol Pro Forma Pro Forma
Group, Inc. Pacific Express Warehouse Adjustments Combined
Revenues $ 4,722 $ 2,288 $ $9,628 $ 1,500 (b) $ 18,138
Expenses
Salaries and wages expense 1,780 674 2,667 (250) (d) 5,339
468 (b)
Operating expense 2,298 429 4,992 (738) (b) 6,981
Depreciation and amortization 255 266 1,256 353 (e) 2,471
275 (c)
66 (b)
General and administration expense 268 43 148 32 (108) 383
Interest expense 68 45 517 388 (f) 1,018
Other expense 518 596 (244) (500) 370
----------- -------- ------- ---------- ---------- ----------
Total expenses 268 4,962 2,158 9,220 (46) 16,562
Operating income (loss) (268) (240) 130 408 1,546 1,576
Provision for income taxes 45 (62) (190) 299 92
----------- -------- ------- ---------- ---------- ----------
Income (loss) before discontinued
operations (268) (195) 68 218 1,845 1,668
Discontinued operations (13,570) - - - - (13,570)
----------- --------- ------- --------- ---------- ----------
Net income (loss) $ (13,838) $ (195) $ 68 $ 218 $ 1,845 $ (11,902)
Loss per common share:
Continuing operations $ (0.13) $ 0.14
Discontinued operations (2.77) (1.43)
----------- ----------
Total $ (2.90) $ (1.29)
=========== ==========
Weighted average number of shares 4,909,528 9,519,370
For the twelve months ended December 31, 1996
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(in thousands, except shares)
Unaudited Unaudited
Transit Carolina Service Capitol Pro Forma Pro Forma
Group, Inc. Pacific Express Warehouse Adjustments Combined
Revenues $ 23,404 $ 11,691 $ 4,428 $ 16,920 $ 3,000 (b) $ 36,039
(23,404) (g)
Expenses
Salaries and wages expense 13,377 4,528 1,263 4,661 (800) (d) 13,584
3,932 (b)
(13,377) (g)
Operating expense 7,126 5,533 1,875 8,705 1,587 (b) 17,700
(7,126) (g)
Depreciation and amortization 1,857 957 620 2,512 711 (e) 5,482
550 (c)
132 (b)
(1,857) (g)
General and administration expense 5,335 37 711 443 (4,585) (g) 1,941
Interest expense 717 226 114 1,068 280 (f) 1,688
(717) (g)
Other expense 141 375 (33) (487) (141) (g) (145)
---------- -------- ------- --------- ----------- -----------
Total expenses 28,553 11,656 4,550 16,902 (21,411) 40,250
---------- -------- ------- --------- ----------- -----------
Operating income (loss) (5,149) 35 (122) 18 1,007 (4,211)
Provision for income taxes (103) 19 (15) 294 (h) 195
---------- -------- -------- -------- ----------- ------------
Income (loss) before discontinued
operations (5,149) (68) (103) 3 1,301 (4,016)
Discontinued operations - - - - - -
---------- -------- -------- -------- ----------- ------------
Net income (loss) $ (5,149) $ (68) $ (103) $ 3 $ 1,301 $ (4,016)
========== ======== ======== ======== =========== ============
Loss per common share:
Continuing operations $ (1.48) $ (0.39)
Discontinued operations
---------- ------------
Total $ (1.48) $ (0.39)
========== ============
Weighted average number of shares 3,758,671 11,202,180
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS:
(a) On August 15, 1997, Transit Group, Inc. (the
"Company") completed the acquisition of Capital Warehouse,
Inc. ("Capital") and Service Express, Inc. ("Service").
Previously, on July 11, 1997, the Company completed the
acquisition of Carolina Pacific Distributors, Inc.
("Carolina"). Pursuant to the Stock Purchase Agreements
executed at the closings (the "Agreements"), the Company
purchased all the outstanding capital stock of Capital,
Service and Carolina. The total purchase price of
approximately $18.4 million consists of $3.7 million in
cash, the issuance of 641,283 shares of common stock of
the Company to the shareholder of Capital and 903,226
shares of Company stock to the shareholder of Service and
the issuance of 1,733,000 shares of common stock of the
company to the shareholders of Carolina, and the
assumption of approximately $0.6 million of debt. The
Company's and Service's financial statements are prepared
on a calendar year-end basis while Capital used a fiscal
year ended February 29, 1997 and Carolina used a fiscal
year ended September 30, 1996. Accordingly, the
accompanying unaudited pro forma combined financial
statements combine the December 31, 1996 and June 30, 1997
financial statements of the Company and Service, and the
February 29, 1997 and August 31, 1997 financial statements
of Capital, and the September 30, 1996 and June 30, 1997
financial statements of Carolina, respectively. Such
financial information is intended to reflect the combined
financial position and results of operations as of each of
the periods presented and is not necessarily indicative of
future combined financial position or results of
operations.
(b) To reflect the purchase by the Company of certain
additional productive assets from an affiliate of Carolina
and the assumption of related borrowings.
(c) To reflect the APB 16 purchase accounting adjustments
including the financing of $3.5 million in cash paid at
closing, the issuance of 3,277,509 shares at fair market
value of the Company's common stock to the shareholders of
Capital, Service and Carolina, resulting in goodwill of
approximately $16.4 million and amortization of goodwill
recorded in connection with the acquisition over a 30-year
period.
(d) To reflect certain adjustments to salaries and
employee benefits expense resulting from the acquisition
of Carolina.
(e) To eliminate the depreciation expense associated with
certain assets not acquired in the purchases of Carolina.
(f) To reflect interest expense associated with new
borrowings acquired in connection with the acquisition at
an average annual interest rate of 8%.
(g) To eliminate the discontinued parcel delivery and
courier operations at Transit Group, Inc.
(h) To reflect the utilization of the Company's net
operating loss carryforwards to offset Capital, Service
and Carolina taxable income.