Exhibit 99.1
Forward Air Corporation Reports Record
Second Quarter 2005 Results; 13.3% Revenue Growth; 21.7% Operating
Margin; 42.3% Fully Diluted EPS Growth
GREENEVILLE, Tenn.--(BUSINESS WIRE)--July 26, 2005--Forward Air
Corporation (NASDAQ:FWRD) today reported record results for the second
quarter ended June 30, 2005.
Operating revenue for the quarter ended June 30, 2005 increased
13.3% to a record $77.5 million from $68.4 million for the same
quarter in 2004. Income from operations was $16.8 million, compared
with $13.4 million in the prior-year quarter, an increase of 25.4%. As
a percent of operating revenue, income from operations expanded to
21.7% from 19.6% in 2004. Pre-tax income for the quarter increased to
$19.0 million from $13.6 million in the previous period. Included in
pre-tax income during 2005 is a $1.4 million ($0.9 million after-tax
or $0.03 per diluted share) gain from the settlement of a lawsuit
discussed below. Net income during the period increased 41.2% to $12.0
million from $8.5 million in the prior-year quarter. Diluted income
per share from operations for the second quarter of 2005 was $0.37
compared with $0.26 in the prior-year quarter, an increase of 42.3%.
Operating revenue for the six months ended June 30, 2005 increased
10.8% to $147.0 million from $132.7 million for the same period in
2004. Income from operations was $30.2 million, compared with $24.1
million in the prior-year period, an increase of 25.3%. As a percent
of operating revenue, income from operations expanded to 20.5% for the
first six months of 2005 from 18.2% in 2004. Pre-tax income for the
period increased to $32.9 million from $24.5 million in the previous
period. Pre-tax income during the first six months of 2005 includes a
$1.4 million ($0.9 million after-tax or $0.03 per diluted share) gain
from the settlement of a lawsuit discussed below. Net income during
the period increased 34.6% to $20.6 million from $15.3 million in the
prior-year period. Diluted income per share from operations for the
first six months of 2005 was $0.63 compared with $0.47 in the
prior-year period, an increase of 34.0%.
Commenting on the Company's second quarter 2005 results, Bruce A.
Campbell, President and CEO, said, "Congratulations to the Forward Air
team for its efforts in these record results. We were encouraged by
the positive trends we saw during the quarter and our team was able to
successfully execute the acquisition of selected assets from the
airport-to-airport operations of U.S. Xpress Enterprises, Inc. during
the last month of the second quarter. We feel our sole focus of
providing on-time, damage-free service to the time-definite freight
market has positioned us well for continued success."
Commenting further on the second quarter 2005 results, Andrew C.
Clarke, Senior Vice President and CFO, said, "During the quarter, the
Company was able to settle its lawsuit with the City of Atlanta
regarding property the Company owned adjacent to the
Hartsfield-Jackson Airport. As a result of the settlement, we
recognized a pre-tax gain of $1.4 million ($0.9 million after-tax or
$0.03 per diluted share), which is reflected in the results above.
Regarding the acquisition of certain assets of U.S. Xpress, the
Company recorded amortization expense of approximately $0.1 million
during the second quarter and expects the ongoing quarterly impact to
be approximately $0.3 million."
Review of Financial Results
Forward Air will hold a quarterly conference call to discuss
second quarter 2005 results on Wednesday, July 27, 2005, at 9:00 a.m.
EDT. The Company's conference call will be available online at
www.forwardair.com or by dialing 800-841-9385. A replay of the
conference call will be available at www.forwardair.com beginning
shortly after the completion of the live call.
About Forward Air
Forward Air is a high-service-level contractor to the air cargo
industry providing time-definite ground transportation services
through a network of 80 terminals located on or near major airports in
the United States and Canada. The Company provides these services as a
cost-effective alternative to air transportation of cargo that must be
delivered at a specific time but is relatively less time-sensitive
than traditional air freight or when air transportation is not
economical.
FORWARD AIR CORPORATION
Condensed Statements of Income (Unaudited)
(In thousands, except per share data)
Three months ended Six Months Ended
-------------------- ---------------------
6/30/05 6/30/04 (a) 6/30/05 6/30/04 (a)
-------------------- ---------------------
Operating revenue $77,488 $ 68,410 $147,021 $132,713
Operating expenses:
Purchased transportation 31,003 27,925 59,482 54,919
Salaries, wages and
employee benefits 16,367 15,110 31,819 29,783
Operating leases 3,376 3,191 6,712 6,453
Depreciation and
amortization 1,969 1,696 3,822 3,395
Insurance and claims 1,839 1,827 3,021 3,249
Other operating expenses 6,143 5,257 11,993 10,776
-------------------- ---------------------
Total operating expenses 60,697 55,006 116,849 108,575
-------------------- ---------------------
Income from operations 16,791 13,404 30,172 24,138
Other income, net 2,191 208 2,708 371
-------------------------------------------
Pre-tax income 18,982 13,612 32,880 24,509
Income taxes 7,028 5,104 12,233 9,194
-------------------- ---------------------
Net income $11,954 $ 8,508 $ 20,647 $ 15,315
==================== =====================
Income per share:
Basic $ 0.37 $ 0.26 $ 0.64 $ 0.47
Diluted $ 0.37 $ 0.26 $ 0.63 $ 0.47
Weighted average shares
outstanding:
Basic 32,277 32,246 32,282 32,255
Diluted 32,621 32,697 32,674 32,669
FORWARD AIR CORPORATION
Condensed Consolidated Balance Sheets
(In thousands)
6/30/05 12/31/04
------------ -----------
(Unaudited) Audited (b)
Assets:
Cash and short-term investments $ 93,949 $ 111,678
Other current assets 48,102 47,744
Property and equipment, net 35,602 37,286
Other assets 29,165 17,845
------------ ----------
Total assets $ 206,818 $ 214,553
============ ==========
Liabilities and Shareholders' Equity:
Current liabilities 25,854 25,657
Long-term obligations 7,467 7,893
Shareholders' equity 173,497 181,003
------------ ----------
Total liabilities and shareholders' equity $ 206,818 $ 214,553
============ ==========
(a) Income per share has been restated to give effect to a
three-for-two stock split declared in February 2005.
(b) Taken from audited financial statements, which are not presented
in their entirety.
Important Information
This press release contains "forward-looking statements," as
defined in Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements are statements other than historical
information or statements of current condition and relate to future
events or our future financial performance. Some forward-looking
statements may be identified by use of such terms as "believes,"
"anticipates," "intends," "plans," "estimates," "projects" or
"expects." Such forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different from
any future results, performance or achievements expressed or implied
by such forward-looking statements. The following is a list of
factors, among others, that could cause actual results to differ
materially from those contemplated by the forward-looking statements:
economic factors such as recessions, inflation, higher interest rates
and downturns in customer business cycles, our inability to maintain
our historical growth rate because of a decreased volume of freight
moving through our network or decreased average revenue per pound of
freight moving through our network, increasing competition and pricing
pressure, surplus inventories, loss of a major customer, the
creditworthiness of our customers and their ability to pay for
services rendered, our ability to secure terminal facilities in
desirable locations at reasonable rates, the inability of our
information systems to handle an increased volume of freight moving
through our network, changes in fuel prices, claims for property
damage, personal injuries or workers' compensation, employment matters
including rising health care costs, enforcement of and changes in
governmental regulations, environmental and tax matters, the handling
of hazardous materials, the availability and compensation of qualified
independent owner-operators and freight handlers needed to serve our
transportation needs and our inability to successfully integrate
acquisitions. As a result of the foregoing, no assurance can be given
as to future financial condition, cash flows or results of operations.
We undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise.
CONTACT: Forward Air Corporation
Andrew C. Clarke, 423-636-7000
aclarke@forwardair.com