Attached files
EXHIBIT 99
CON-WAY INC.
NEWS RELEASE
Contacts:
Investor: Patrick Fossenier 1+650-378-5353
News Media: Gary Frantz 1+650-378-5335
CON-WAY INC. REPORTS 2011 FIRST-QUARTER RESULTS
ANN ARBOR, Mich. May 4, 2011 Con-way Inc. (NYSE:CNW) today reported net
income for the first quarter of 2011 of $6.9 million, or 12 cents per diluted
share. The results compare to a first quarter 2010 net loss of $4.0 million,
or 8 cents per share.
On a non-GAAP basis, net income in the 2011 first quarter was $13.2 million,
or 24 cents per diluted share compared to a loss of $0.8 million, or 2 cents
per share in 2010, excluding the following:
* 2011: $6.3 million of increased tax expense from adjustments for discrete
and other tax items.
* 2010: A $2.8 million charge for the write-off of a customer-relationship
intangible asset and $1.2 million of increased tax expense from adjustments
for discrete and other tax items.
Revenue for the 2011 first quarter was $1.25 billion, a 7.2 percent increase
from last year's first quarter. Operating income in the 2011 first quarter
was $36.7 million compared to $14.4 million in the first quarter a year ago.
Douglas W. Stotlar, Con-way's president and CEO, noted that despite severe
winter weather, both Con-way Freight and Con-way Truckload achieved increased
profits, while Menlo Worldwide Logistics posted a good quarter against a
record performance last year.
"Con-way Freight's employees are doing a commendable job executing our
strategy," said Stotlar. "The improvement initiatives that we launched last
year at our less-than-truckload (LTL) company are beginning to influence
bottom-line results. The network is operating with high levels of efficiency
and consistency as we continue to improve the fundamentals of the business."
Menlo Worldwide Logistics delivered a solid performance in the 2011 first
quarter. "Facing a tough comparison from a record first quarter last year,
Menlo generated consistent results, growing net revenue and operating income
sequentially over the fourth quarter of 2010," Stotlar noted. "Menlo is well
positioned, particularly with its growing international business and a
strengthening sales pipeline in North America."
Con-way Truckload continued to improve, recording increases in revenue,
profits and operating efficiencies compared to last year's first quarter.
"Strong operating discipline, tighter capacity and improved pricing led to a
good quarter for Con-way Truckload," said Stotlar. "Empty miles are declining
and revenue per loaded mile is rising. Results from the first quarter bid
cycle were encouraging. Con-way Truckload continues to increase productivity
and asset utilization while maintaining its position as a premium service
carrier."
In the 2011 first quarter, Con-way Inc. recognized income tax expense of
$14.4 million, including the earlier-mentioned adjustments, on $21.4 million
of income before taxes. In the 2010 first quarter, income tax expense of
$1.1 million, including the earlier-mentioned adjustments, was reported on a
$2.9 million loss before taxes.
Segment results in the 2011 first quarter for Con-way's principal operations
were as follows:
FREIGHT
For the 2011 first quarter, Con-way Freight, the company's less-than-
truckload operation, reported:
* Revenue of $767.7 million, a 5.9 percent increase over last year's
first-quarter revenue of $725.0 million. Improved yield and higher fuel
surcharge revenue contributed to revenue growth.
* Operating income of $20.3 million compared to an operating loss of $3.2
million in the year-ago period. The quarter benefited from effective
cost controls, lower health care expense, improved balance in network
tonnages, strong operating efficiencies and improved yield.
* Revenue per hundredweight, or yield, increased 9.7 percent from the
previous-year first quarter. Excluding the fuel surcharge, yield rose
5.6 percent.
* Tonnage per day declined 4.7 percent compared to the previous-year first
quarter, reflecting efforts over the past year to moderate tonnage to
improve network efficiency.
* Operating ratio was 97.4 in the 2011 first quarter compared to 100.4 in
the previous-year period.
LOGISTICS
For the first quarter of 2011, Menlo Worldwide Logistics, the company's
global logistics and supply chain management operations, reported:
* Revenue of $370.0 million, an increase of 4.2 percent from the prior
year first-quarter revenue of $355.2 million, due to increased revenue
from transportation-management services, partially offset by lower
revenue from warehouse-management services.
* Net revenue of $142.3 million, a 1.3 percent decline from $144.2 million
in the previous year first quarter, which benefited primarily from
higher performance-based revenue compared to the current quarter.
* Operating income of $8.6 million, a 32.7 percent decline from last
year's first-quarter operating income of $12.9 million, which benefited
from higher performance-based revenue. Lower operating income in the
2011 period also was affected by lower margins on both warehouse- and
transportation-management services. First quarter 2010 included the
previously mentioned $2.8 million impairment charge.
TRUCKLOAD
For the first quarter of 2011, Con-way Truckload, the company's full-
truckload transportation operation, reported:
* Revenue of $145.2 million compared to prior-year first-quarter revenue
of $140.6 million, reflecting the positive effect of higher fuel
surcharges and improved revenue per loaded mile (excluding fuel
surcharges).
* Operating income of $7.1 million compared to $3.0 million in the
previous-year period. The increase in first-quarter operating income
resulted largely from improved pricing and operating costs that declined
as a percentage of revenue.
* Revenue per loaded mile (excluding fuel surcharges) increased 3.8
percent from the previous-year first quarter.
* Empty miles were 9.6 percent of total miles compared to 10.1 percent in
the previous-year first quarter.
* Operating ratio exclusive of fuel surcharges was 93.8, compared to 97.5
in the first quarter of 2010.
CON-WAY OTHER
Con-way Other includes the company's Road Systems, Inc. trailer manufacturing
unit as well as other corporate activities. These activities produced first-
quarter operating income of $0.6 million and $1.7 million in 2011 and 2010,
respectively.
INVESTOR CONFERENCE CALL
Con-way will host a conference call for the investment community tomorrow,
Thursday, May 5, beginning at 8:30 a.m. Eastern Daylight Time (5:30 a.m.
Pacific).
The call can be accessed by dialing (866) 264-3634 or (706) 643-3632 (for
international callers) and is expected to last approximately one hour. The
call will also be available through a live internet webcast at www.con-
way.com, in the investor relations section.
An audio replay will be available for two weeks following the call dialing
(800) 642-1687 or (706) 645-9291 (for international callers) and using access
code 57077418. An Internet replay of the presentation will also be available
at the Con-way website.
About Con-way -- Con-way Inc. (NYSE:CNW) is a $5.0 billion freight
transportation and logistics services company headquartered in Ann Arbor,
Mich. A diversified transportation company, Con-way delivers industry-leading
services through three primary operating companies: Con-way Freight, Con-way
Truckload and Menlo Worldwide Logistics. These operating units provide high-
performance, day-definite less-than-truckload and full truckload freight
transportation, as well as logistics, warehousing, multimodal and supply
chain management services, and trailer manufacturing. Con-way Inc. and its
subsidiaries operate from more than 500 locations across North America and in
20 countries. For more information about Con-way, visit us on the Web at
www.con-way.com.
FORWARD-LOOKING STATEMENTS
Certain statements in this press release constitute "forward-looking
statements" and are subject to a number of risks and uncertainties and should
not be relied upon as predictions of future events. All statements other than
statements of historical fact are forward-looking statements, including: any
projections of earnings, revenues, weight, yield, volumes, income or other
financial or operating items, all statements of the plans, strategies,
expectations or objectives of Con-way's management for future operations or
other future items, any statements concerning proposed new products or
services, any statements regarding Con-way's estimated future contributions
to pension plans, any statements as to the adequacy of reserves, any
statements regarding the outcome of any legal and other claims and
proceedings that may be brought against Con-way, any statements regarding
future economic conditions or performance, any statements regarding strategic
acquisitions, any statements of estimates or belief, and any statements or
assumptions underlying the foregoing. Specific factors that could cause
actual results and other matters to differ materially from those discussed in
such forward-looking statements include: changes in general business and
economic conditions, increasing competition and pricing pressure, the
creditworthiness of Con-way's customers and their ability to pay for services
rendered, changes in fuel prices or fuel surcharges, the possibility that
Con-way may, from time to time, be required to record impairment charges for
goodwill, intangible assets and other long-lived assets, the possibility of
defaults under Con-way's $325 million credit agreement and other debt
instruments (including without limitation defaults resulting from unusual
charges), uncertainty in the credit markets, including the effect on Con-
way's ability to refinance indebtedness as and when it becomes due, labor
matters, enforcement of and changes in governmental regulations or
legislation which potentially could result in an adverse impact on the
company, environmental and tax matters, and matters relating to Con-way's
defined benefit pension plans, including the effect on the plans of changes
in discount rates and in the value of plan assets. The factors included
herein and in Item 7 of Con-way's 2010 Annual Report on Form 10-K as well as
other filings with the Securities and Exchange Commission could cause actual
results and other matters to differ materially from those in such forward-
looking statements. As a result, no assurance can be given as to future
financial condition, cash flows, or results of operations.
****************************************************
Con-way Inc.
Consolidated Statements of Operating Results
(Dollars in thousands except per share amounts)
Three Months Ended
March 31
--------------------
2011 2010
-------- --------
REVENUE
Freight $ 767,741 725,003
Logistics [a] 369,975 355,183
Truckload 145,215 140,616
Other 11,997 11,839
Inter-segment Revenue
Eliminations (49,301) (70,730)
----------- ----------
$1,245,627 1,161,911
___________ __________
OPERATING INCOME (LOSS)
Freight $ 20,344 (3,153)
Logistics [b] 8,646 12,856
Truckload 7,083 2,975
Other 623 1,722
--------- ---------
36,696 14,400
Other Expense, net 15,335 17,314
--------- --------
Income (Loss) before Income
Tax Provision 21,361 (2,914)
Income Tax Provision 14,439 1,123
---------- --------
Net Income (Loss) 6,922 (4,037)
Applicable to Common Shareholders
---------- ---------
Weighted-Average Common Shares Outstanding
Basic 55,039,751 49,335,702
Diluted 55,725,230 49,335,702
Income (Loss) Per Common Share
Basic
$ 0.13 $ (0.08)
__________ __________
Diluted
$ 0.12 $ (0.08)
****************************************************
[a] Logistics' net revenue
Revenue $ 369,975 355,183
Purchased transportation
expense (227,654) (210,934)
---------- ---------
Net revenue $ 142,321 144,249
__________ _________
[b] Includes a $2.8 million prior-year first-quarter charge for the
write-off of a customer-relationship intangible asset.
***************************************
Con-way Inc.
Reconciliation of GAAP Financial Measure to Non-GAAP Financial Matters
(Dollars in thousands except per share amounts)
Three Months Ended
March 31
--------------------
2011 2010
-------- --------
Net Income (Loss) Applicable $ 6,922 (4,037)
to Common Shareholders
Before-Tax Reconciling Items
Impairment of goodwill and
other intangible assets - (2,767)
----------- ----------
$ - (2,767)
___________ __________
Tax-Related Reconciling Items
Tax effect of items above $ - 692
Change in annual effective tax rate 150 -
Discrete tax adjustments (6,471) (1,185)
--------- ---------
(6,321) (493)
_________ _________
Adjusted Non-GAAP Financial Measures:
Net Income (Loss) Available to --------- --------
Common Shareholders $ 13,243 (777)
_________ ________
Net Income (Loss) Per Diluted
Common Share $ 0.24 (0.08)
_________ ________
_________ ________
Diluted Common
Shares Outstanding 55,725,230 49,335,702
Information About Non-GAAP Finacial Measures:
Con-way provides adjusted net income and earnings per share as additional
information to investors. These measures are not in accordance with
generally accepted accounting principles in the United States ("GAAP").
Con-way's non-GAAP financial measures are intended to supplement, but
not substitute for, the most directly comparable GAAP measures. Con-way
believes that the non-GAAP financial measures provide meaningful
information to assist investors and analysts in understanding Con-way's
financial results because they exclude items that may not be indicative
or are unrelated to Con-way's core operating results. However, because
non-GAAP financial measures are not standardized, it may not be
possible to compare these financial measures across companies. Investors
are strongly encouraged to review Con-way's financial statements and
publicly filed reports in their entirety and not rely on any
single financial measure.
***************************************
Con-way Inc.
Consolidated Condensed Balance Sheets
(Dollars in thousands)
March 31, December 31,
2011 2010
ASSETS
Current assets $ 1,215,592 $ 1,120,077
Property, plant
and equipment, net 1,408,006 1,404,585
Other assets 418,031 419,070
------------- ----------------
Total Assets $ 3,041,629 $ 2,943,732
_____________ ________________
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 725,904 $ 651,890
Long-term debt
and capital leases 789,120 793,950
Other long-term
liabilities and
deferred credits 690,219 678,360
Shareholders'
equity 836,386 819,532
------------- ----------------
Total Liabilities and
Shareholders' Equity $ 3,041,629 $ 2,943,732
_____________ ________________
