RADIANT LOGISTICS, INC - FORM 10-Q - EX-99.1

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10-Q - RADIANT LOGISTICS, INC	v211133_10q.htm
EX-32.1 - RADIANT LOGISTICS, INC	v211133_ex32-1.htm
EX-31.1 - RADIANT LOGISTICS, INC	v211133_ex31-1.htm

Exhibit 99.1

Contact:

Bohn H. Crain

Chief Executive Officer

Radiant Logistics, Inc.

(425) 943-4599

RADIANT POSTS 63% GROWTH WITH ADJUSTED EBITDA OF $1,672,000 FOR

THE FISCAL SECOND QUARTER ENDED DECEMBER 31, 2010

Provides Upward Guidance from $5,000,000 to $5,500,000 in Adjusted EBITDA for

FYE June 30, 2011

BELLEVUE, WA, February 14, 2011 – Radiant Logistics, Inc. (OTC BB: RLGT), a domestic and international freight forwarding and logistics services company, today reported financial results for the three and six months ended December 31, 2010.

For the three months ended December 31, 2010, Radiant reported net income of $716,000 on $44.5 million of revenues, or $0.02 per basic and fully diluted share, including a charge on litigation settlement of $150,000. For the three months ended December 31, 2009, Radiant reported net income of $549,000 on $39.1 million of revenues, or $0.02 per basic and fully diluted share, including a gain on litigation settlement of $355,000.

For the six months ended December 31, 2010, Radiant reported net income of $1,499,000 on $90.9 million of revenues, or $0.05 per basic and fully diluted share, including a charge on litigation settlement of $150,000. For the six months ended December 31, 2009, Radiant reported net income of $665,000 on $73.1 million of revenues, or $0.02 per basic and fully diluted share, including a gain on litigation settlement of $355,000.

In December of 2010, the Company recorded a charge of $150,000 in connection with the settlement of a dispute with one of its competitors related to the 2007 departure of our competitor’s then Chicago operation. By agreement among the parties, without admission of any wrong doing on the part of the Company and with affirmation of the parties’ right to freely compete in the marketplace, the Company agreed to make a $150,000 donation to a mutually agreeable IRC 503(c) charitable organization. Neither the Company nor our competitor received any payment in connection with the settlement.

In December 2009, the Company recorded a gain of $355,000 in connection with the favorable settlement of a dispute with the former owner of Adcom Worldwide related to the calculation and payment of working capital and certain related post-closing items.

The Company also reported adjusted EBITDA (earnings before interest, taxes, depreciation amortization), excluding the non-recurring items, of $1,672,000 for the three months ended December 31, 2010, compared to adjusted EBITDA of $1,026,000 for the comparable prior year period.

The Company also reported adjusted EBITDA (earnings before interest, taxes, depreciation amortization), excluding the non-recurring items, of $3,381,000 for the six months ended December 31, 2010 compared to adjusted EBITDA of $1,750,000 for the comparable prior year period. A reconciliation of our adjusted EBITDA to the most directly comparable GAAP measure appears at the end of this release.

“We remain very pleased with our overall operating results,” said Bohn Crain, Chairman and CEO. “For the quarter ended December 31, 2010, our revenues increased 13.8% to $44.5 million as compared to $39.1 million for the comparable prior year period. Net transportation revenues also increased 23.3% to $14.2 million as compared to $11.5 million for the comparable prior year period. This improvement was a direct result of the improving economy and resurgence of our domestic transportation services. We also continue to focus on our personnel and general administrative costs as a function of our net revenues and the continuing positive trend surrounding our controllable costs. As a percentage of net revenues, our personnel costs decreased from 13.3% to 11.0%. Our selling, general and administrative costs, as a percentage of net revenues, decreased from 10.0% to 8.0%. We are very excited about these trends, the leverage of our scalable non-asset based business model and the anticipated margin expansion available to us as we continue to execute our growth strategy.”

Crain concluded, “As we look forward to the balance of our fiscal year ending June 30, 2011, we are cautiously optimistic as to the sustainability of the economic recovery. For the fiscal year ending June 30, 2011, we are updating our prior guidance and expect to generate approximately $5.5 million in adjusted EBITDA on $175.0 million in annual revenues. This is before considering the impact of any future acquisitions over the balance of the fiscal year. Looking forward, our strategy remains unchanged. From our current platform, we believe profitable growth can be best achieved by continuing to bring value to the agent-based forwarder community and continuing to execute our three-prong strategy of first, providing continuous improvement to our existing network participants in terms of technology, buy rates and enhanced service offerings; second, building upon the success of our organic growth initiative by on-boarding additional agent stations; and third, opportunistically pursuing acquisition opportunities, including strategic opportunities within the community of agent-based forwarders. Through this process we have identified and are in conversations with a select number of potential partners that could materially accelerate our growth. I look forward to updating you on our progress in the coming months as these opportunities continue to develop.”

Supplemental Pro Forma Information

We believe that supplemental disclosure of our adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization adjusted for stock-based compensation, goodwill impairment and other non-cash costs is a useful measure for investors because it eliminates the effect of certain non-cash costs and provides an important metric for our business. Adjusted EBITDA is a non-GAAP measure of income. A reconciliation of adjusted EBITDA amounts to Net income, the most directly comparable GAAP measure, for the three and six months ended December 31, 2010 and 2009 is shown below:

(Amounts in 000’s)	THREE MONTHS ENDED DECEMBER 31,					SIX MONTHS ENDED DECEMBER 31,
	2010		2009			2010		2009

Net income	$	716	$	549		$	1,499	$	665

Net interest expense		36		27			72		82
Income tax expense		414		337			920		408
Depreciation and amortization		327		386			652		796

EBITDA		1,493		1,299			3,413		1,951
Share-based compensation and other non-cash charges		29		82			88		154
(Gain) or loss on litigation settlement		150		(355	)		150		(355	)

Adjusted EBITDA	$	1,672	$	1,026		$	3,381	$	1,750

This supplemental pro forma financial information is presented for informational purposes only and is not a substitute for the historical financial information presented in accordance with accounting principles generally accepted in the United States. A reconciliation of adjusted EBITDA amounts to Net income, the most directly comparable GAAP measure, for the fiscal year ending June 30, 2011 is shown below:

Financial Outlook

(Amounts in 000’s)
	Outlook Fiscal Year Ended June30, 2011		Actual Fiscal Year Ended June 30, 2010

Net income	$	2,417	$	1,959

Net interest expense		200		135
Income tax expense		1,482		1,093
Depreciation and amortization		1,119		1,598

EBITDA		5,218		4,785
Stock-based compensation and other
non-cash charges		132		315
Gain on extinguishment of debt		-		(135	)
Business & Occupancy tax refund		-		(364	)
(Gain) loss on litigation settlement		150		(355	)

Adjusted EBITDA	$	5,500	$	4,246

Investor Conference Call

Radiant will host a conference call for shareholders and the investing community on Tuesday, February 15, 2011 at 4:00 pm, ET to discuss the contents of the release. The call can be accessed by dialing (877) 407-8031, or (201) 689-8031 for international participants, and is expected to last approximately 30 minutes. Callers are requested to dial in 5 minutes before the start of the call. An audio replay will be available for one week after the teleconference by dialing (877) 660-6853, or (201) 612-7415 for international callers, and using account number 286 and conference ID number 366738.

About Radiant Logistics (OTC BB: RLGT)

Radiant Logistics (www.radiantdelivers.com) is a non-asset based logistics company providing domestic and international freight forwarding and related services through a network of approximately 70 company owned and exclusive agent offices across North America. Operating under the Airgroup, Adcom Worldwide and Radiant brands, the company services a diversified account base including manufacturers, distributors and retailers using a network of independent carriers and international agents positioned strategically around the world. For more information about Radiant Logistics, please contact Bohn Crain at (425) 943-4599.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding future operating performance, events, trends and plans. All statements other than statements of historical fact contained herein, including, without limitation, statements regarding our future financial position, business strategy, budgets, projected revenues and costs, and plans and objectives of management for future operations, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expects,” “intends,” “plans,” “projects,” “estimates,” “anticipates,” or “believes” or the negative thereof or any variation thereon or similar terminology or expressions. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Important factors that could cause our actual results to differ from our expectations, include but are not limited to, our ability to: use our current infrastructure as a “platform” upon which we can build a profitable global transportation and supply chain management company; retain and build upon the relationships we have with our exclusive agency offices; continue the development of our back office infrastructure and transportation and accounting systems in a manner sufficient to service our expanding revenues and base of exclusive agency locations; continue growing our business and maintain historical or increased gross profit margins; locate suitable acquisition opportunities; secure the financing necessary to complete any acquisition opportunities we locate; assess and respond to competitive practices in the industries in which we compete, mitigate, to the best extent possible, our dependence on current management and certain of our larger exclusive agency locations; assess and respond to the impact of current and future laws and governmental regulations affecting the transportation industry in general and our operations in particular; as well as those risk factors disclosed in Item 1A of our Report on Form 10 K for the year ended June 30, 2010 other filings with the Securities and Exchange Commission and other public documents and press releases which can be found on our web-site (www.radiantdelivers.com). Readers are cautioned not to place undue reliance on our forward-looking statements, as they speak only as of the date made. Such statements are not guarantees of future performance or events and we undertake no obligation to disclose any revision to these forward-looking statements to reflect events or circumstances occurring after the date hereof.

RADIANT LOGISTICS, INC.

Consolidated Balance Sheets

	December 31,			June 30,
	2010			2010
ASSETS
Current assets -
Cash and cash equivalents	$	98,042		$	682,108
Accounts receivable, net of allowance
of $474,258 and $626,401 respectively		23,783,074			21,442,023
Current portion of employee loan receivable		18,001			13,100
Current portion of station and other receivables		110,822			195,289
Prepaid expenses and other current assets		1,779,261			1,104,211
Deferred tax asset		316,740			402,428
Total current assets		26,105,940			23,839,159

Furniture and equipment, net		880,678			881,416

Acquired intangibles, net		1,526,182			2,019,757
Goodwill		1,011,310			982,788
Employee loan receivable, net of current portion		29,526			38,000
Station and other receivables, net of current portion		136,051			151,160
Investment in real estate		40,000			40,000
Deposits and other assets		177,785			153,116
Deferred tax asset – long term		190,718			106,023
Total long term assets		3,111,572			3,490,844
Total assets	$	30,098,190		$	28,211,419

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities -
Accounts payable and accrued transportation costs		18,023,253			16,004,814
Commissions payable		1,965,506			2,119,503
Other accrued costs		684,796			538,854
Income taxes payable		212,410			76,309
Due to former Adcom shareholder		36,708			603,205
Other current liabilities		75,000			-
Total current liabilities		20,997,673			19,342,685

Long term debt		6,319,629			7,641,021
Deferred tax liability		611,024			439,905
Total long term liabilities		6,930,653			8,080,926
Total liabilities		27,928,326			27,423,611

Stockholders' equity:
Preferred stock, $0.001 par value, 5,000,000 shares authorized; no shares issued or outstanding		-			-
Common stock, $0.001 par value, 50,000,000 shares authorized. Issued and outstanding: December 31, 2010 – 29,782,721; June 30, 2010 – 31,273,461		16,157			16,157
Common stock issuable, $0.001 par value,732,038 and 0 shares, respectively		732			-
Additional paid-in capital		8,446,788			8,108,239
Treasury stock, at cost, 4,919,239 and 3,428,499 shares, respectively		(1,407,455	)		(936,190	)
Retained deficit		(4,967,738	)		(6,466,946	)
Total Radiant Logistics, Inc. stockholders’ equity		2,088,484			721,260
Non-controlling interest		81,380			66,548
Total stockholders’ equity		2,169,864			787,808
Total liabilities and stockholders’ equity	$	30,098,190		$	28,211,419

RADIANT LOGISTICS, INC.

Consolidated Statements of Income (Operations)

	THREE MONTHS ENDED DECEMBER 31,						SIX MONTHS ENDED DECEMBER 31,
	2010			2009			2010			2009

Revenue	$	44,496,820		$	39,115,845		$	90,857,877		$	73,144,179
Cost of transportation		30,314,763			27,611,567			62,557,124			51,091,017
Net revenues		14,182,057			11,504,278			28,300,753			22,053,162

Agent commissions		9,850,191			7,838,360			19,682,651			15,293,565
Personnel costs		1,561,268			1,531,465			3,118,428			2,953,862
Selling, general and administrative expenses		1,140,135			1,153,161			2,203,417			2,249,433
Depreciation and amortization		326,808			385,937			652,066			795,717
Total operating expenses		12,878,402			10,908,923			25,656,562			21,292,577

Income from operations		1,303,655			595,355			2,644,191			760,585

Other income (expense):
Interest income		5,630			9,563			11,439			3,273
Interest expense		(42,179	)		(36,756	)		(84,421	)		(85,791	)
Other		63,407			454			89,693			98,765
Gain (loss) on litigation settlement		(150,000	)		354,670			(150,000	)		354,670
Total other income (expense)		(123,142	)		327,931			(133,289	)		370,917

Income before income tax expense		1,180,513			923,286			2,510,902			1,131,502

Income tax expense		(413,319	)		(336,539	)		(918,862	)		(407,665	)

Net income		767,194			586,747			1,592,040			723,837

Less: Net income attributable to non-controlling interest		(50,929	)		(37,638	)		(92,832	)		(58,678	)

Net income attributable to Radiant Logistics, Inc.	$	716,265		$	549,109		$	1,499,208		$	665,159

Net income per common share – basic	$	.02		$	.02		$	.05		$	.02
Net income per common share – diluted	$	.02		$	.02		$	.05		$	.02

Weighted average shares outstanding:
Basic shares		30,122,700			32,533,680			30,296,880			32,950,810
Diluted shares		31,212,861			32,723,181			30,968,361			33,135,684

The accompanying notes form an integral part of these condensed consolidated financial statements.

RADIANT LOGISTICS, INC.

Reconciliation of EBITDA to Net Income and Net Cash Provided By Operating Activities

(UNAUDITED)

As used in this report, adjusted EBITDA means earnings before interest, income taxes, depreciation and amortization adjusted for stock-based compensation and other non-cash charges. We believe that adjusted EBITDA, as presented, represents a useful method of assessing the performance of our operating activities, as it reflects our earnings trends without the impact of certain non-cash charges. Adjusted EBITDA is also used by our creditors in assessing debt covenant compliance. We understand that although securities analysts frequently use EBITDA in their evaluation of companies, it is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. EBITDA is not intended as an alternative to cash flow provided by operating activities as a measure of liquidity, as an alternative to net income as an indicator of our operating performance, nor as an alternative to any other measure of performance in conformity with accounting principles generally accepted in the United States of America.

The following is a reconciliation of adjusted EBITDA to both net income and cash flow provided by operating activities:

	THREE MONTHS ENDED DECEMBER 31,						SIX MONTHS ENDED DECEMBER 31,
	2010			2009			2010			2009
Adjusted EBITDA	$	1,671,798		$	1,026,166		$	3,380,778		$	1,750,106
Stock-based compensation and other non-cash charges		(28,857	)		(82,058	)		(87,660	)		(153,717	)
Gain (loss) on litigation settlement		(150,000	)		354,670			(150,000	)		354,670
EBITDA		1,492,941			1,298,778			3,143,118			1,951,059

Depreciation and amortization		(326,808	)		(385,937	)		(652,066	)		(795,717	)
Interest expense, net		(36,549	)		(27,193	)		(72,982	)		(82,518	)
Income tax expense		(413,319	)		(336,539	)		(918,862	)		(407,665	)
Net income		716,265			549,109			1,499,208			665,159

ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
PROVIDED BY (USED FOR) OPERATING ACTIVITIES:
Non-cash compensation expense (stock options)		25,832			54,697			80,771			108,904
Amortization of intangibles		248,192			283,654			493,575			591,978
Deferred income tax expense (benefit)		119,432			(201,469	)		993			(261,532	)
Depreciation and leasehold amortization		78,616			102,282			158,491			203,739
Loss (gain) on litigation settlement		150,000			(354,670	)		150,000			(354,670	)
Change in non-controlling interest of subsidiaries		50,929			37,638			92,832			58,678
Loss on disposal of assets		11,931			-			11,931			-
Provision for (recovery of) doubtful accounts		(125,860	)		38,195			(152,143	)		143,608

CHANGE IN OPERATING ASSETS AND LIABILITIES:
Accounts receivable		112,949			(2,270,906	)		(2,188,908	)		(4,436,656	)
Employee receivables		4,073			31,266			3,573			33,266
Station and other receivables		21,688			12,528			99,576			185,475
Prepaid expenses and other assets		(679,054	)		54,913			(699,719	)		(80,091	)
Accounts payable & accrued transportation costs		1,072,032			1,561,598			2,018,439			2,383,214
Commissions payable		(715,507	)		(621,658	)		(153,997	)		(179,945	)
Other accrued costs		23,461			36,781			145,942			(172,669	)
Other long term liabilities		48,059			-			96,119			-
Income taxes payable		(95,680	)		-			136,101			-
Income tax deposit		-			374,348			-			503,556
Total adjustments		351,093			(860,803	)		293,576			(1,273,145	)

Net cash provided by (used) for operating activities	$	1,067,358		$	(311,694	)	$	1,792,784		$	(607,986	)

RADIANT LOGISTICS, INC - FORM 10-Q - EX-99.1 - February 14, 2011

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