EXHIBIT 99.2
EXHIBIT 99.2-PRO-FORMA FINANCIAL INFORMATION
(IN THOUSANDS)
TRANSIT CERTIFIED
GROUP, INC TRANSPORT, PRO FORMA PRO FORMA
MARCH 31, 1998 INC. ADJUSTMENTS MARCH 31, 1998
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CURRENT ASSETS 15,039 4,202 (150) (a) 19,091
PROPERTY AND EQUIPMENT 31,432 4,076 1,550 (a) 37,058
GOODWILL 31,526 - 1,000 (a) 32,526
OTHER NONCURRENT ASSETS 774 999 1,773
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78,771 9,277 2,400 90,448
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ACCOUNTS PAYABLE AND ACCRUED EXPENSES 10,260 2,717 12,977
CURRENT PORTION OF LONG TERM DEBT 9,178 700 9,878
LONG-TERM DEBT 28,773 1,035 1,500 (a) 31,308
DEFERRED TAXES 2,357 - 2,357
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50,568 4,452 1,500 56,520
REDEEMABLE COMMON STOCK 7,127 - - 7,127
STOCKHOLDERS EQUITY 21,076 4,825 900 (a) 26,801
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78,771 9,277 2,400 90,448
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(a) TO REFLECT THE APB 16 PURCHASE ACCOUNTING ADJUSTMENTS INCLUDING THE
FINANCING OF $1.5 MILLION, THE ISSUANCE OF 1,072,000 SHARES OF THE
COMPANY'S STOCK, AND EXPENSES INCURRED IN CONNECTION WITH THE ACQUISITION
OF CERTIFIED TRANSPORT, INC. GOODWILL OF APPROXIMATELY $1 MILLION WAS
RECORDED WHICH WILL BE AMORTIZED OVER A 40 YEAR PERIOD.
EXHIBIT 99.2-PRO-FORMA FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT SHARE DATA)
TWELVE MONTH TRANSIT CAROLINA SERVICE CAPITOL CARROLL RAINBOW CERTIFIED UNAUDITED
DECEMBER 31, GROUP,INC. PACIFIC EXPRESS WAREHOUSE FULMER TRUCKING TRM,INC. TRANSPORT ADJ. PRO FORMA
- -----------------------------------------------------------------------------------------------------------------------------------
(686)(b)
REVENUES - 12,353 4,560 17,886 63,739 14,294 5,958 21,095 1,500 (c) 140,699
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SALARIES & WAGES - 4,611 1,569 5,687 8,484 3,937 2,410 4,191 (250)(e) 30,640
1,545 (c)
OPERATING EXPENSES - 5,908 1,413 8,361 50,898 8,337 2,368 12,905 (186)(b) 91,549
DEPRECIATION
& AMORTIZATION - 669 426 2,219 948 254 760 1,688 - 6,963
GOODWILL ADJUSTMENT - - - - - - - - 814 (d) 814
GENERAL
& ADMINISTRATIVE 900 87 254 244 1,660 810 99 782 - 4,836
(184)(c)
INTEREST EXPENSE 166 405 80 1,077 926 153 275 409 915 (d) 4,222
OTHER EXPENSE - 518 596 (244) (58) - - - (500)(b) 312
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TOTAL EXPENSES 1,066 12,198 4,338 17,344 62,858 13,491 5,912 19,975 2,154 139,335
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PRE-TAX INCOME (1,066) 155 222 542 881 803 46 1,120 (654) 1,364
INCOME TAXES (1,365) 62 89 217 353 321 18 448 - 144
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NET INCOME 299 93 133 325 529 482 28 672 (654) 1,220
=============================================================================================== ==========
WEIGHTED AVERAGE NO OF SHARES-BASIC 17,870,348
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WEIGHTED AVERAGE NO OF SHARES-DILUTED 19,314,457
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EARNINGS PER SHARE-BASIC 0.07
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EARNINGS PER SHARE-DILUTED 0.06
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NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(a) ON MAY 5,1998 TRANSIT GROUP, INC. (THE "COMPANY") COMPLETED THE
ACQUISITION OF CERTIFIED TRANSPORT, INC. AND ITS AFFILIATE, VENTURE
LOGISTICS, INC. ("CERTIFIED") THE COMPANY HAD COMPLETED SIX
ACQUISITIONS PRIOR TO THE ACQUISITION OF CERTIFIED. A RECAP OF THE
COMPANY'S ACQUISITIONS IS AS FOLLOWS:
DATE CASH SHARES
COMPANY ACQUIRED PAID(MIL) ISSUED
------- -------- --------- ------
CERTIFIED TRANSPORT, INC. MAY 5, 1998 $1.5 1,072,000
TRM, INC. JANUARY 31, 1998 $0.2 366,000
RAINBOW TRUCKING, INC. DECEMBER 30, 1997 - 679,000
CARROLL FULMER, INC. AUGUST 29, 1997 - 4,167,000
SERVICE EXPRESS, INC. AUGUST 15, 1997 - 903,000
CAPITOL WAREHOUSE, INC. AUGUST 15, 1997 - 641,000
CAROLINA PACIFIC
DISTRIBUTORS, INC. JULY 11, 1997 $3.7 1,733,000
THE FINANCIAL STATEMENTS OF THE COMPANY, CERTIFIED, TRM, INC. AND
SERVICE EXPRESS, INC. ARE PREPARED ON A CALENDAR YEAR-END BASIS WHILE
CARROLL FULMER INC. USED A FISCAL YEAR ENDED MAY 31, 1997, CAPITOL
WAREHOUSE, INC. USED A FISCAL YEAR ENDED FEBRUARY 29, 1997 AND
CAROLINA PACIFIC DISTRIBUTORS, INC. USED A FISCAL YEAR ENDED SEPTEMBER
30, 1997. ACCORDINGLY, THE ACCOMPANYING UNAUDITED PRO FORMA COMBINED
FINANCIAL STATEMENTS OF THE COMPANY CERTIFIED, TRM, INC. AND SERVICE
EXPRESS, INC., AND THE MAY 31,1997 AND AUGUST 31, 1997 FINANCIAL
STATEMENTS OF CARROLL FULMER, INC. AND THE FEBRUARY 29,1997 AND AUGUST
31, 1997 FINANCIAL STATEMENTS OF CAPITOL WAREHOUSE, INC., AND THE
SEPTEMBER 30, 1997 FINANCIAL STATEMENTS OF CAROLINA PACIFIC
DISTRIBUTORS, INC., 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 ELIMINATE INTERCOMPANY TRANSACTIONS.
(c) TO REFLECT THE PURCHASE BY THE COMPANY OF CERTAIN ADDITIONAL
PRODUCTIVE ASSETS FROM AN AFFILIATE OF CAROLINA PACIFIC DISTRIBUTORS,
INC. AND THE ASSUMPTION OF RELATED BORROWINGS, AND THE CAPITAL LEASE
BY THE COMPANY OF ADDITIONAL PRODUCTIVE ASSETS FROM AFFILIATES OF
CARROLL FULMER, INC.
(d) TO REFLECT THE APB 16 PURCHASE ACCOUNTING ADJUSTMENTS INCLUDING THE
FINANCING OF $5.4 MILLION IN CASH PAID AT CLOSING, THE ISSUANCE OF
APPROXIMATELY 9.6 MILLION SHARES AT FAIR MARKET VALUE OF THE COMPANY'S
COMMON STOCK TO THE SHAREHOLDERS OF THE ACQUIRED COMPANIES AND
EXPENSES ASSOCIATED WITH THE ACQUISITIONS. IN CONNECTION WITH THE
ACQUISITIONS, GOODWILL OF APPROXIMATELY $33.0 MILLION WAS RECORDED.
SUCH GOODWILL WILL BE AMORTIZED OVER A 40-YEAR PERIOD.
(e) TO REFLECT CERTAIN ADJUSTMENTS TO SALARIES AND EMPLOYEE BENEFITS
RESULTING FROM THE ACQUISITION OF CAROLINA PACIFIC DISTRIBUTORS, INC.
EXHIBIT 99.2-PRO-FORMA FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT SHARE DATA)
(A) (B) (C)
THREE MONTHS ENDED TRANSIT CERTIFIED PRO FORMA UNAUDITED
MARCH 31, GROUP,INC. TRANSPORT ADJUSTMENTS PRO FORMA
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REVENUES 26,430 3,623 (196) 138,862
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SALARIES & WAGES 5,599 1,962 7,561
OPERATING EXPENSES 17,025 661 17,686
DEPRECIATION & AMORTIZATION 1,349 265 (110) (b) 1,510
GOODWILL ADJUSTMENT 6 (c)
GENERAL & ADMINISTRATIVE 711 186 897
INTEREST EXPENSE 804 40 31 875
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TOTAL EXPENSES 25,488 3,114 (73) 28,529
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PRE-TAX INCOME 942 509 (123) 1,328
INCOME TAXES 100 51 (12)(e) 139
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NET INCOME 842 458 (111) 1,189
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WEIGHTED AVERAGE NO OF SHARES-BASIC 17,870,348
===============
WEIGHTED AVERAGE NO OF SHARES-DILUTED 19,314,457
===============
EARNINGS PER SHARE-BASIC 0.09
===============
EARNINGS PER SHARE-DILUTED 0.08
===============
(A) CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH
31, 1998 FOR TRANSIT GROUP, INC.
(B) STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1998 FOR
CERTIFIED TRANPORT, INC. ("CTI") WHICH WAS ACQUIRED BY TRANSIT GROUP
ON MAY 5, 1998.
(C) PRO FORMA ADJUSTMENTS
(a) TO ADJUST FOR GAIN ON SALE OF REVENUE EQUIPMENT REALIZED BY
CTI.
(b) TO REFLECT IMPACT OF BASIS STEP UP ON FIXED ASSETS AND ADJUSTMENT OF
USEFUL LIVES OF EQUIPMENT TO COMPLY WITH COMPANY POLICY.
(c) TO REFLECT AMORTIZATION OF GOODWILL
(d) TO REFLECT INTEREST EXPENSE ASSOCIATED WITH NEW BORROWINGS
INCURRED IN CONNECTION WITH THE ACQUISITION OF CTI AT AN AVERAGE
INTEREST RATE OF 8.20%.
(e) TO REFLECT INCOME TAX EFFECT OF PROFORMA ADJUSTMENTS.