AGRICULTURAL EXPRESS OF AMERICA, INC.
Financial Statements
June 30, 1994 and 1993
AGRICULTURAL EXPRESS OF AMERICA, INC.
Balance Sheets
June 30 December 31
1994 1993
(Unaudited) (Note)
Assets
Current assets:
Cash and cash equivalents $1,502,487 $1,000,578
Trade accounts receivable, less
allowance for doubtful accounts of
$16,826 in 1994 and $34,985 in 1993 2,077,175 1,139,262
Other receivables 274,719 234,456
Prepaid expenses 29,854 47,531
---------- ----------
Total current assets 3,884,235 2,421,827
Property and equipment, at cost:
Revenue equipment 4,055,670 3,568,136
Administrative equipment 104,610 99,024
---------- ----------
Total property and equipment 4,160,280 3,667,160
Less accumulated depreciation (1,295,394) (982,380)
---------- ----------
Net property and equipment 2,864,886 2,684,780
---------- ----------
Total Assets $6,749,121 $5,106,607
========== ==========
Liabilities and Stockholders' Equity
Current liabilities:
Current maturities of long-term debt $ 600,000 $ 300,000
Accounts payable 1,529,042 1,170,342
Accrued liabilities 199,920 197,723
---------- ----------
Total current liabilities 2,328,962 1,668,065
Long-term debt 1,200,000 700,000
Stockholders' equity:
Common stock, $1 par value. Authorized
10,000 shares; issued and outstanding
1,188 shares 1,188 1,188
Additional paid-in capital 657,155 657,155
Retained earnings 2,983,754 2,502,137
Note receivable from officer (421,938) (421,938)
---------- ----------
Total stockholders' equity 3,220,159 2,738,542
---------- ----------
Total Liabilities and
Stockholders' Equity $6,749,121 $5,106,607
========== ==========
<FN>
<F1>
Note: The balance sheet at December 31, 1993 has been derived from audited
financial statements at that date but does not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements.
<F2>
See accompanying notes to financial statements.
</FN>
AGRICULTURAL EXPRESS OF AMERICA, INC.
Statements of Earnings and Retained Earnings (Unaudited)
Six Months Ended
June 30
1994 1993
Revenue $ 7,296,059 $ 6,763,126
Purchased transportation services 6,143,216 5,547,048
----------- -----------
Gross margin 1,152,843 1,216,078
Indirect expenses:
Salaries, wages and benefits 175,860 143,179
Selling, general and administration 93,990 80,372
Insurance 3,231 1,873
Occupancy and supplies 18,689 20,310
State income taxes 27,335 37,173
Depreciation 317,241 252,764
Professional services 11,338 7,835
Other 8,609 20,908
----------- -----------
656,293 564,414
----------- -----------
Operating income 496,550 651,664
Nonoperating income (expense):
Interest income 28,781 26,155
Interest expense (48,329) --
Gain on disposal of equipment 5,034 6,813
Other, net (419) --
----------- -----------
(14,933) 32,968
----------- -----------
Net income 481,617 684,632
Retained earnings at beginning of period 2,502,137 1,436,404
----------- -----------
Retained earnings at end of period $ 2,983,754 $ 2,121,036
=========== ===========
<FN>
See accompanying notes to financial statements.
</FN>
AGRICULTURAL EXPRESS OF AMERICA, INC.
Statements of Cash Flows (Unaudited)
Six Months Ended
June 30
1994 1993
Cash flows from operating activities:
Net income $ 481,617 $ 684,632
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation 317,241 252,764
Gain on disposal of equipment (5,034) (6,813)
Increase in receivables (978,176) (1,040,820)
Decrease in prepaid expenses 17,676 8,817
Increase in accounts payable and
accrued liabilities 360,897 801,801
---------- ----------
Net cash provided by
operating activities 194,221 700,381
Cash flows from investing activities:
Purchase of equipment (508,035) (834,590)
Proceeds from sale of equipment 15,723 7,400
---------- ----------
Net cash used in
investing activities (492,312) (827,190)
Cash flows from financing activities:
Proceeds from the issuance of debt 800,000 --
Principal payment on debt -- (700,100)
---------- ----------
Net cash provided by
(used in) financing activities 800,000 (700,100)
---------- ----------
Net increase (decrease) in cash
and cash equivalents 501,909 (826,909)
Cash and cash equivalents at
beginning of period 1,000,578 1,324,657
---------- ----------
Cash and cash equivalents at end of period $1,502,487 $ 497,748
========== ==========
Supplemental disclosures of
cash flow information:
State income taxes paid $ 20,125 $ 12,500
========== ==========
Interest paid $ 52,003 $ --
========== ==========
<FN>
See accompanying notes to financial statements.
</FN>
AGRICULTURAL EXPRESS OF AMERICA, INC.
Notes to Financial Statements
June 30, 1994
Note A -- Nature and Organization of Business
Agricultural Express of America, Inc. (the Company), a Delaware
corporation, is a motor carrier specializing primarily in intermodal, long
haul, and full-load shipments of perishable exempt commodities from the West
Coast to eastern destinations with railroads as the primary source of
transportation.
Note B -- Financial Statement Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the six months ended June 30, 1994, are not necessarily
indicative of the results that may be expected for the year ended December
31, 1994. For further information, refer to the Company's financial
statements and footnotes thereto for the year ended December 31, 1993,
included elsewhere herein.
Note C -- Subsequent Event
On September 30, 1994, the Company and two affiliated companies were
purchased by Arkansas Best Corporation pursuant to a stock purchase agreement
entered into on August 18, 1994. Under the agreement, Arkansas Best
Corporation is to pay a total consideration of approximately $60 million in
cash for the Company and its affiliates, subject to certain closing audit and
other contractual adjustments.
Note D -- Long-term Debt
On May 31, 1994 the Company converted $1,800,000 borrowed under its
revolving credit line to a term loan payable in 12 equal quarterly
installments. The term loan bears interest at a variable rate (6.625% at
June 30, 1994) and is collateralized by revenue equipment.