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8-K - FORM 8-K (SECOND QUARTER FISCAL 2012 EARNINGS RELEASE AND CASH DIVIDEND) - CELADON GROUP INCform8k.htm
Exhibit 99
 
 celadon logo
 
9503 East 33rd Street
Indianapolis, IN  46235
(800) CELADON
(317) 972-7000


For more information:
Jeryl Desjarlais
Communications Manager
(800) CELADON Ext. 7070
(317) 972-7070 Direct
jdesjarlais@celadongroup.com
FOR IMMEDIATE RELEASE
January 25, 2012


CELADON GROUP REPORTS SECOND FISCAL QUARTER FINANCIAL RESULTS
AND DECLARES DIVIDEND

INDIANAPOLIS – Celadon Group Inc. (NYSE: CGI) today reported its financial and operating results for the three and six months ended December 31, 2011, the second fiscal quarter of the Company's fiscal year ending June 30, 2012.

Revenue for the quarter increased 6.3% to $141.5 million in the 2011 quarter from $133.1 million in the 2010 quarter.  Freight revenue, which excludes fuel surcharges, increased to $112.4 million in the 2011 quarter from $111.6 million in the 2010 quarter.  Net income increased 86.2% to $5.4 million in the 2011 quarter from $2.9 million for the same quarter last year.  Earnings per diluted share increased to $0.24 in the 2011 quarter from $0.13 for the same quarter last year.

For the six months ended December 31, 2011, revenue increased 3.5% to $283.0 million in 2011 from $273.4 million for the same period last year.  Freight revenue, which excludes fuel surcharges, decreased 2.7% to $224.7 million in 2011 from $231.0 million for the same period last year.  Net income increased 47.9% to $10.8 million in 2011 from $7.3 million for the same period last year.  Earnings per diluted share increased to $0.48 in 2011 from $0.32 for the period last year.

Chairman and CEO Steve Russell commented on the December 2011 quarter.  "Earnings per share of twenty four cents compared with thirteen cents in the December 2010 quarter.  Our average rate per loaded mile improved to $1.53, up approximately five cents per mile from the December 2010 quarter, or approximately four percent.  Cost controls and operating efficiencies continued to positively impact results.  Operating ratio improved to 92.5 in the December 2011 quarter from 95.0 in the December 2010 quarter."

"The truckload industry has been experiencing a significant driver shortage.  To address this situation, we completed two asset acquisitions in the December 2011 quarter, American Eagle, the non-refrigerated division of Frozen Food Express and USF Glen Moore, Inc.  As a consequence,  average seated count increased to 2,633 in the December 2011 quarter, up from 2,529 in the September 2011 quarter.  We expect our seated count to increase in the March 2012 quarter as the USF Glen Moore, Inc. acquisition was completed at the end of December."

"Our balance sheet remains solid and we retain significant liquidity to support the growth of our business.  At December 31, 2011, we had $179.6 million of stockholders' equity and $36.5 million of total balance sheet borrowings of which we had $34.5 million in bank borrowings outstanding on our $100 million bank line at December 31, 2011."

 
 

 

On January 24, 2012, our Board of Directors has approved a regular cash dividend to shareholders for the quarter ending March 31, 2012.  The quarterly cash dividend of two cents ($0.02) per share of common stock will be payable on April 16, 2012 to shareholders of record at the close of business on April 4, 2012.

Conference Call Information

An investor conference call is scheduled for Thursday, January 26, at 10:00 a.m. EST. Steve Russell and other members of management will discuss the results of the quarter.  To listen and participate in a questions-and-answers exchange, simply dial 866-551-3680 pin number 46518598 followed by the # key a few minutes prior to the start time.  A replay will be available through February 24 by dialing 866-551-4520 and entering call back code 279251 followed by the # key.

This call is being Web cast by Thomson/CCBN and can be accessed via Celadon's Web site at www.celadongroup.com.

Celadon Group Inc. (www.celadongroup.com), through its subsidiaries, primarily provides long-haul, full-truckload freight service across the United States, Canada and Mexico.  The company also owns Celadon Dedicated Services, which provides supply chain management solutions, such as warehousing and dedicated fleet services; and Celadon Brokerage Services.

This press release contains certain statements that may be considered 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.  Such statements may be identified by their use of terms or phrases such as "expects," "estimates," "projects," "believes," "anticipates," "plans," "intends," and similar terms and phrases.  Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements.  Actual results may differ from those set forth in the forward-looking statements.  The following factors, among others, could cause actual results to differ materially from those in forward-looking statements: the risk that our perception of additional capacity due to seating trucks and perceived benefits thereof are inaccurate; the risk that our perception of changes in our customer base and perceived benefits thereto are inaccurate; the risk that managing our tractor fleet age does not result in greater flexibility and lower operating expenses; excess tractor and trailer capacity in the trucking industry; decreased demand for our services or loss of one or more of our major customers; surplus inventories; recessionary economic cycles and downturns in customers' business cycles; strikes, work slow downs, or work stoppages at our facilities, or at customer, port, border crossing, or other shipping related facilities; increases in compensation for and difficulty in attracting and retaining qualified drivers and independent contractors; increases in insurance premiums and deductible amounts; elevated experience in the frequency or severity of claims relating to accident, cargo, workers' compensation, health, and other matters; fluctuations in claims expenses that result from high self-insured retention amounts and differences between estimates used in establishing and adjusting claims reserves and actual results over time; increases or rapid fluctuations in fuel prices, as well as fluctuations in hedging activities and surcharge collection, the volume and terms of diesel purchase commitment, interest rates, fuel taxes, tolls, and license and registration fees; fluctuations in foreign currency exchange rates; increases in the prices paid for new revenue equipment and changes in the resale value of our used equipment; increases in interest rates or decreased availability of capital or other sources of financing for revenue equipment; seasonal factors such as harsh weather conditions that increase operating costs; competition from trucking, rail, and intermodal competitors; regulatory requirements that increase costs or decrease efficiency, including revised hours-of-service requirements for drivers and new emissions control regulations; our ability to identify acceptable acquisition candidates, consummate acquisitions, and integrate acquired operations; the timing of, and any rules relating to, the opening of the border to Mexican drivers; challenges associated with doing business internationally; our ability to retain key employees; and the effects of actual or threatened military action or terrorist attacks or responses, including security measures that may impede shipping efficiency, especially at border crossings.

Readers should review and consider these factors along with the various disclosures by the company in its press releases, stockholder reports, and filings with the Securities Exchange Commission.  We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.

- tables follow -

 
 

 

CELADON GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars and shares in thousands except per share amounts)
(Unaudited)

   
For the three months ended
   
For the six months ended
 
   
December 31,
   
December 31,
 
   
2011
   
2010
   
2011
   
2010
 
                         
REVENUE:
                       
Freight revenue
  $ 112,379     $ 111,553     $ 224,676     $ 231,023  
Fuel surcharge revenue
    29,135       21,578       58,317       42,397  
Total revenue
    141,514       133,131       282,993       273,420  
                                 
OPERATING EXPENSES:
                               
Salaries, wages, and employee benefits
    37,562       37,574       75,122       75,701  
Fuel
    37,063       30,931       75,530       63,202  
Purchased transportation
    27,302       25,426       54,435       51,300  
Revenue equipment rentals
    6,269       6,728       12,178       14,277  
Operations and maintenance
    10,177       10,050       19,979       20,143  
Insurance and claims
    3,676       3,468       6,719       7,593  
Depreciation and amortization
    5,766       6,769       11,360       14,296  
Cost of products and services sold
    -       1,350       -       2,748  
Communications and utilities
    998       1,062       1,903       2,169  
Operating taxes and licenses
    2,595       2,432       5,104       4,825  
General and other operating
    1,668       1,705       3,297       3,449  
Total operating expenses
    133,076       127,495       265,627       259,703  
                                 
Operating income
    8,438       5,636       17,366       13,717  
                                 
Interest expense
    160       565       203       1,027  
Interest income
    (44 )     (15 )     (52 )     (31 )
Other income
    (211 )     (79 )     (498 )     (146 )
Income before income taxes
    8,533       5,165       17,713       12,867  
Income tax expense
    3,085       2,307       6,893       5,588  
Net income
  $ 5,448     $ 2,858     $ 10,820     $ 7,279  
                                 
Income per common share:
                               
Diluted
  $ 0.24     $ 0.13     $ 0.48     $ 0.32  
Basic
  $ 0.24     $ 0.13     $ 0.49     $ 0.33  
                                 
Diluted weighted average shares outstanding
    22,697       22,569       22,687       22,563  
Basic weighted average shares outstanding
    22,248       22,051       22,233       22,054  
                                 
                                 
                                 
                                 
                                 
                                 
                                 


 
 

 

Key Operating Statistics
                         
   
For the three months ended
   
For the six months ended
 
   
December 31,
   
December 31,
 
   
2011
   
2010
   
2011
   
2010
 
                         
Average revenue per loaded mile (*)
  $ 1.528     $ 1.477     $ 1.527     $ 1.474  
Average revenue per total mile (*)
  $ 1.363     $ 1.319     $ 1.363     $ 1.320  
Average revenue per tractor per week (*)
  $ 2,823     $ 2,794     $ 2,901     $ 2,880  
Average miles per seated tractor per week(**)
    2,072       2,116       2,124       2,178  
Average seated line-haul tractors(**)
    2,633       2,687       2,581       2,688  
                                 
*Freight revenue excluding fuel surcharge and our Mexican subsidiary Jaguar.
 
**Total seated fleet, including equipment operated by independent contractors and our Mexican subsidiary, Jaguar.
 

CELADON GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, 2011 and June 30, 2011
(Dollars in thousands except par value amounts)

   
(unaudited)
       
   
December 31,
   
June 30,
 
ASSETS
 
2011
   
2011
 
Current assets:
           
Cash and cash equivalents
  $ 1,418     $ 25,673  
Trade receivables, net of allowance for doubtful accounts of $1,057 and $1,045 at December 31, 2011 and June 30, 2011, respectively
    60,615       64,723  
Prepaid expenses and other current assets
    13,808       14,403  
Tires in service
    6,793       6,594  
Assets held for sale
    25,653       ---  
Income tax receivable
    2,131       ---  
Deferred income taxes
    3,868       3,940  
Total current assets
    114,286       115,333  
Property and equipment
    247,991       213,222  
Less accumulated depreciation and amortization
    76,319       80,592  
Net property and equipment
    171,672       132,630  
Tires in service
    3,182       2,914  
Goodwill
    16,702       16,702  
Investment in unconsolidated companies
    3,153       2,902  
Other assets
    6,582       1,701  
Total assets
  $ 315,577     $ 272,182  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
               
Current liabilities:
               
Accounts payable
  $ 13,629     $ 10,475  
Accrued salaries and benefits
    11,871       13,192  
Accrued insurance and claims
    10,853       13,360  
Accrued fuel expense
    9,468       11,113  
Other accrued expenses
    18,499       15,729  
Current maturities of capital lease obligations
    363       354  
Income taxes payable
    ---       1,778  
Total current liabilities
    64,683       66,001  
Long-term debt
    34,531       ---  
Capital lease obligations, net of current maturities
    1,556       1,740  
Deferred income taxes
    35,229       31,740  
Stockholders' equity:
               
Common stock, $0.033 par value, authorized  40,000,000 shares; issued and outstanding  23,875,833 and 23,886,601 shares at December 31, 2011 and June 30, 2011, respectively
      788       788  
Treasury stock at cost; 1,258,319 and 1,364,364 shares at December 31, 2011 and June 30, 2011, respectively
    (8,677 )     (9,408 )
Additional paid-in capital
    100,250       99,906  
Retained earnings
    92,297       82,367  
Accumulated other comprehensive loss
    (5,080 )     (952 )
Total stockholders' equity
    179,578       172,701  
Total liabilities and stockholders' equity
  $ 315,577     $ 272,182