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Investor Contact: Investor Relations
(330) 665-8814
Media Contact: Dina Gruey
(330) 665-8849
FOR IMMEDIATE RELEASE
JULY 14, 1997
CALIBER SYSTEM ANNOUNCES SECOND QUARTER RESULTS
RPS CONTINUES DOUBLE-DIGIT GROWTH; VIKING POSTS PROFIT FROM ONGOING OPERATIONS
AKRON, OHIO - Caliber System, Inc. (NYSE: CBB) today reported net
earnings from its ongoing businesses for the second quarter ended June 21, 1997,
of $24.3 million or $.62 per share. These earnings exclude $16.1 million of
transition costs attributable to operating losses at the former Central Freight
Lines and to other non-recurring costs related to the closing of the former
Coles and Spartan Divisions of Viking Freight. Including the transition costs,
the Company's net income for the quarter was $13.6 million or $.34 per share,
compared to net income of $220,000 or $.01 per share for the second quarter of
1996.
Combined revenue for RPS, Caliber Logistics and Roberts Express
increased 14% for the quarter, from $389.6 million in 1996 to $443.4 million in
1997. Second quarter 1997 revenue from Viking's ongoing operations in the West
amounted to $81.4 million. Caliber's total revenue decreased from $615.9 million
in the second quarter last year to $574.7 million in 1997 as a result of the
Viking restructuring announced on March 27, 1997.
For the first half of 1997, net income from ongoing operations was
$31.5 million or $.80 per share. First quarter restructuring costs for Viking of
$1.43 per share, discussed in Caliber's first quarter earnings release, and
second quarter transition expenses of $.28 per share reduced year-to-date
earnings per share to a loss of $.91, compared to earnings of $.25 per share for
1996. First half revenues from ongoing operations of $1.17 billion are slightly
below the $1.2 billion realized a year ago because of the restructuring.
"We are pleased with our results for the quarter and the first half of
1997," said Daniel J. Sullivan, Chairman, President and CEO of Caliber System.
"In the past six months, we have made good progress in strengthening our balance
sheet and enhancing shareholder value."
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Second Quarter Results
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RPS Continues Double-Digit Revenue and Profit Growth
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Second quarter operating income at RPS, Caliber's small-package
carrier, rose nearly 15% to $32.3 million, compared to $28.2 million in 1996.
Revenue was $338.7 million, up 12% from $302.5 million for the same quarter a
year ago.
"RPS has posted double-digit growth for the past seven months, and we
expect that momentum to continue at least through the end of the year," said
Sullivan. "Our investments in geographic expansion, new market segments,
technology and infrastructure are providing increasingly positive returns.
Productivity improved year over year, and revenue yields are stronger than last
year and the first quarter. In addition, RPS's on-time service continues to run
at record levels as we move closer to our goal of 99% by 1999."
Viking Posts Second Quarter Profit from Ongoing Operations
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Viking's ongoing operations posted an operating profit of $1.4 million
in the first full quarter since the unit's restructuring as a regional carrier
serving 12 western states. In 1996, Viking reported second quarter operating
losses of $33.3 million.
"The restructuring plan is proceeding ahead of plan," stated Sullivan.
"The sale of Viking's Southwestern Division, which is now operating under the
name Central Freight Lines, Inc., was finalized on June 30."
Caliber Logistics and Roberts Express Record Strong Performances
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Caliber Logistics experienced a 35% increase in gross revenue and a 34%
gain in net revenue in the second quarter and improved its operating income.
Roberts Express, the Company's expedited carrier, recorded revenue growth of 6%
and increased its year-over-year operating income for the quarter by 11%.
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Second Quarter Results
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Consolidated Results
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Unaudited revenue and earnings for the second quarter of 1997 and year
to date, with comparable figures for 1996, are as follows:
SECOND QUARTER YEAR TO DATE
-------------- ------------
June 21, 1997 June 15,1996 June 21,1997 June 15, 1996
------------- ------------ ------------ -------------
(dollars in thousands, except per share data)
Revenue:
RPS $ 338,715 $ 302,452 $ 677,850 $ 590,151
Viking 81,439 226,281 282,490 437,565
Other 104,650 87,168 205,660 170,259
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524,804 615,901 1,166,000 1,197,975
Transition Revenue 49,872 -- 49,872 --
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Net Revenue 574,676 615,901 1,215,872 1,197,975
Operating Expenses 549,716 614,487 1,262,386 1,178,380
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Operating Income (Loss):
RPS 32,337 28,206 71,048 55,935
Viking 1,406 (33,253) (31,658) (47,241)
Other 7,353 6,461 15,232 10,901
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41,096 1,414 54,622 19,595
Transition Operating Loss (16,136) -- (16,136) --
Restructuring Charge -- -- (85,000) --
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Operating Income (Loss) 24,960 1,414 (46,514) 19,595
Other Expense, Net (2,403) (1,370) (2,528) (2,602)
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Income (Loss) Before Income Taxes 22,557 44 (49,042) 16,993
Provision (Benefit) For Income Taxes 8,972 (176) (13,403) 7,152
--------- ----------- ----------- -----------
Net Income (Loss) $ 13,585 $ 220 (35,639) 9,841
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Earnings (Loss) Per Share $ 0.34 $ 0.01 $ (0.91) $ 0.25
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Average Shares Outstanding 39,208 39,525 39,228 39,515
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Note: The gain on the sale of investments decreased other expense, net by $2.3
million or $0.05 per share in the second quarter and by $7.6 million or $.12 per
share year to date. The Company operates in 13 four-week periods. Each of the
first three quarters contain 12 weeks and the fourth quarter contains 16 weeks.
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Second Quarter Results
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Caliber System is a leading provider of value-added transportation,
logistics and related information services. Its operating companies include RPS,
a business-to-business small-package carrier; Viking Freight, a supplier of
regional freight service in the West; Caliber Logistics, a contract logistics
provider; Roberts Express, a critical-shipment carrier; and Caliber Technology,
a producer of systemwide information services. By combining its operating units'
products and services, Caliber offers integrated, customized solutions that meet
customer demand for more comprehensive transportation and logistics programs.
This release contains forward-looking statements that are subject to
certain risks and uncertainties that could cause actual results to differ
materially. These risks and uncertainties are detailed from time to time in
reports filed by the Company with the Securities and Exchange Commission,
including Forms 8-K, 10-Q and 10-K.
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