Attached files
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EX-99.2 - EX-99.2 - Horizon Lines, Inc. | g24163exv99w2.htm |
EX-99.3 - EX-99.3 - Horizon Lines, Inc. | g24163exv99w3.htm |
EX-99.4 - EX-99.4 - Horizon Lines, Inc. | g24163exv99w4.htm |
8-K - FORM 8-K - Horizon Lines, Inc. | g24163e8vk.htm |
Exhibit 99.1
PRESS RELEASE
For information contact:
Jim Storey
Director, Investor Relations & Corporate Communications
704.973.7107
jstorey@horizonlines.com
Jim Storey
Director, Investor Relations & Corporate Communications
704.973.7107
jstorey@horizonlines.com
HORIZON LINES REPORTS IMPROVED SECOND-QUARTER FINANCIAL RESULTS
| Revenue, Net Income and EBITDA Up from Year Ago | ||
| Container Volumes Increase Slightly; Rate, Net of Fuel, Marginally Lower | ||
| Full-Year Expectations Remain In Line with Prior Year |
Comparison of GAAP and Non-GAAP Earnings (in millions, except per share data)*
Quarters Ended | ||||||||
6/20/10 | 6/21/09 | |||||||
GAAP: |
||||||||
Operating revenue |
$ | 305.6 | $ | 278.5 | ||||
Net income (loss) |
$ | 3.7 | $ | (31.1 | ) | |||
Net income (loss) per share |
$ | 0.12 | $ | (1.02 | ) | |||
Non-GAAP: |
||||||||
EBITDA |
$ | 28.4 | $ | 3.5 | ||||
Adjusted EBITDA* |
$ | 29.6 | $ | 28.5 | ||||
Adjusted net income * |
$ | 4.8 | $ | 4.1 | ||||
Adjusted net income per share* |
$ | 0.15 | $ | 0.13 |
* | See attached schedules for reconciliation of second-quarter 2010 and 2009 reported GAAP results to adjusted Non-GAAP results. |
CHARLOTTE, NC, July 23, 2010 Horizon Lines, Inc. (NYSE: HRZ) today reported improved
financial results for its fiscal second quarter ended June 20, 2010.
On a GAAP basis, Horizon achieved second-quarter net income of $3.7 million, or $0.12 per fully
diluted share, on revenue of $305.6 million. This compares with a net loss of $31.1 million, or
$1.02 per share, on revenue of $278.5 million for the second quarter of 2009.
On an adjusted basis, second-quarter net income rose to $4.8 million, or $0.15 per fully diluted
share, from $4.1 million, or $0.13 per fully diluted share, a year ago. The 2010 second-quarter
adjusted net income excludes charges of $1.1 million, or $0.03 per diluted share, for
antitrust-related legal expenses and a voluntary separation program for certain union employees.
The 2009 adjusted net income excludes expenses totaling $35.2 million, or $1.15 per share,
consisting primarily of a $20 million pretax charge related to the class-
Horizon Lines 2nd Quarter 2010 | Page 2 of 12 |
action legal settlement in Puerto Rico, a $10.6 million tax valuation allowance, and $4.1
million in pretax antitrust-related legal expenses.
Conditions improved somewhat, but remained challenging during the second quarter as the pace of
our business continued to be impacted by the slow, uneven global economic recovery, said Chuck
Raymond, Chairman, President and Chief Executive officer. We nevertheless achieved improved
financial results by focusing on profitable revenue growth and continued diligent cost management.
Free cash flow and debt paydown were ahead of expectations and we finished the quarter with
adequate liquidity.
The quarters financial results were positively impacted by improved contributions from our Alaska
tradelane, terminal services provided to third parties, and logistics, as well as from increased
overhead savings, Mr. Raymond said. Overall volume trends continued to improve slowly, resulting
in very modest quarterly volume growth from a year ago. Although this trend is encouraging, the
rate and degree of volume change in our GDP-driven domestic ocean freight business is historically
slower and more muted than in many other transportation sectors. We expect the pace and
sustainability of this trend will depend largely on the strength of the ongoing economic recovery
in our markets and the corresponding impact on consumer confidence.
Container rates, net of fuel, decreased slightly for the quarter, largely reflecting rate
pressures in Puerto Rico, where capacity was added to the market in the second quarter, despite the
ongoing recession there, Mr. Raymond said. We expect rates to remain under pressure in Puerto
Rico.
Second-Quarter 2010 Financial Highlights
Operating Revenue Second-quarter operating revenue increased 9.7% to $305.6 million from $278.5 million a year ago. The largest factor in the $27.1 million revenue gain was an $18.5 million increase in fuel surcharges to help partially mitigate higher fuel costs. Terminal services and other revenue contributed $7.7 million of the improvement, while logistics added $6.9 million. Increased container volume accounted for $1.4 million of the revenue growth. Alaska registered a volume increase for the quarter, relative to a year ago, while volume in Hawaii/Guam and Puerto Rico declined slightly. Alaska and Hawaii/Guam have begun showing signs of modest economic recovery. Puerto Rico remains in recession, but has shown signs of stabilization, with overall industry ocean freight volumes to the island firming in recent months. However, vessel capacity was added to the Puerto Rico tradelane by a competitor in the second quarter, further pressuring pricing and contributing to an overall rate decline that decreased revenue by $1.1 million. Also partially offsetting the operating revenue increase was a $6.3 million decline related to the expiration of vessel management contracts with the federal government. | ||
Operating Income (Loss) GAAP operating income for the second quarter totaled $13.9 million, compared with an operating loss of $11.2 million for the second quarter of 2009. The 2010 GAAP operating income includes expenses of $1.1 million, consisting |
Horizon Lines 2nd Quarter 2010 | Page 3 of 12 |
of $1.0 million in antitrust-related legal expenses and $0.1 million in union severance charges. The 2009 GAAP operating loss includes a $20.0 million charge related to the class-action legal settlement in Puerto Rico, $4.1 million in antitrust-related legal expenses and $0.9 million in impairment and restructuring charges. Excluding these items, the second-quarter 2010 adjusted operating income totaled $15.0 million, compared with adjusted operating income of $13.7 million for the prior years second quarter. Second-quarter adjusted operating income improved from last year primarily due to better results from the Alaska tradelane, terminal services and logistics revenue gains, overhead savings, and lower costs related to new terminal services agreements. These favorable variances were partially offset primarily by higher expenses associated with crane repairs, tugboat usage, incremental maintenance and the inability to fully recover fuel price increases. | ||
EBITDA EBITDA totaled $28.4 million for the 2010 second quarter, compared with $3.5 million for the same period a year ago. Adjusted EBITDA for the second quarter of 2010 was $29.6 million, compared with $28.5 million for 2009. EBITDA and adjusted EBITDA for the 2010 and 2009 second quarters were impacted by the same factors affecting operating income (loss). | ||
Shares Outstanding The company had a weighted daily average of 30.9 million diluted shares outstanding for the second quarter of 2010, compared with 30.4 million outstanding for the second quarter of 2009. | ||
Six-Month Results For the six months ended June 20, 2010, operating revenue increased 7.4% to $591.7 million from $550.8 million for the same period in 2009. EBITDA totaled $39.5 million compared with $17.5 million a year ago. Adjusted EBITDA for the first six months of 2010 totaled $41.9 million, after excluding $2.4 million in antitrust-related legal expenses and union severance charges. Adjusted EBITDA for the first six months of 2009 totaled $47.7 million, after excluding $20 million for the Puerto Rico class-action settlement, $8.5 million in antitrust-related legal expenses, and $1.7 million for impairment, restructuring and other charges. The 2010 six-month net loss totaled $9.6 million, or $0.31 per share, compared with a net loss of $41.0 million, or $1.35 per share for the same period a year earlier. The adjusted net loss for the first six months of 2010 totaled $7.3 million, or $0.24 per share, compared with an adjusted net loss of $0.6 million, or $0.02 per share, a year ago. | ||
Liquidity, Credit Facility Compliance & Debt Structure As of June 20, 2010, the company had total liquidity of $68.1 million, consisting of $4.6 million in cash and $63.5 million of effective revolver availability. The companys trailing 12-month interest coverage and senior secured leverage ratios were 3.81 times and 2.16 times, respectively, as compared to the credit agreement requirement of above 3.5 times and below 2.75 times, respectively. Funded debt outstanding totaled $563.1 million, consisting of $233.1 million in senior secured debt and $330.0 million in convertible notes, at a weighted average interest rate of 4.46%. The companys senior secured debt matures in August 2012, but the maturity will accelerate to February 2012 if the |
Horizon Lines 2nd Quarter 2010 | Page 4 of 12 |
convertible notes are not refinanced or if arrangements are not being made for their refinancing by that date. |
Please see attached schedules for the reconciliation of second-quarter 2010 and 2009 reported GAAP
results and Non-GAAP adjusted results.
Outlook
We continue to expect our 2010 adjusted EBITDA performance to be in the range of 2009 results,
Mr. Raymond said. We are experiencing some economic stabilization and recovery in our markets,
evidenced in part by the ongoing modest volume firming trend. But we also face continuing high
fuel prices and ongoing rate pressure in Puerto Rico. To help mitigate these rate pressures, we are
focusing on schedule integrity, customer service and cost management.
We are making steady progress in preparation for the launch of our transpacific Asia liner
service, Mr. Raymond continued. We have chosen Ningbo and Shanghai in Central China as our ports
of call and continue to receive enthusiastic customer response to our service launch in December.
Webcast & Conference Call Information
Company executives will provide additional perspective on the companys financial results during a
conference call beginning at 11:00 a.m. Eastern Time today. Those interested in participating in
the call may do so by dialing 1-866-394-6819, and providing the operator with conference number
88026736. A copy of the presentation materials may be obtained from the Horizon Lines website,
http://www.horizonlines.com, shortly before the start of the call. Alternatively, a live audio
webcast of the call may be accessed at http://www.horizonlines.com. In order to access the live
audio webcast, please allow at least 15 minutes before the start of the call to visit Horizon
Lines website and download and install any necessary audio/video software for the webcast.
Use of Non-GAAP Measures
Horizon Lines reports its financial results in accordance with U.S. generally accepted accounting
principles (GAAP). The company also believes that the presentation of certain non-GAAP measures,
i.e., EBITDA, free cash flow and results excluding certain costs and expenses, provides useful
information for the understanding of its ongoing operations and enables investors to focus on
period-over-period operating performance without the impact of significant special items. The
company further feels these non-GAAP measures enhance the users overall understanding of the
companys current financial performance relative to past performance and provide a better baseline
for modeling future earnings expectations. Non-GAAP measures are reconciled in the financial tables
accompanying this
news release. The company cautions that non-GAAP measures should be considered in addition to, but
not as a substitute for, the companys reported GAAP results.
Horizon Lines 2nd Quarter 2010 | Page 5 of 12 |
About Horizon Lines
Horizon Lines, Inc., is the nations leading domestic ocean shipping and integrated logistics
company. The company owns or leases a fleet of 20 U.S.-flag containerships and operates five port
terminals linking the continental United States with Alaska, Hawaii, Guam, Micronesia and Puerto
Rico. The company also manages a domestic and overseas service partner network and provides
integrated, reliable and cost competitive logistics solutions. Horizon Lines, Inc., is based in
Charlotte, NC, and trades on the New York Stock Exchange under the ticker symbol HRZ.
Forward Looking Statements
The information contained in this press release should be read in conjunction with our filings made
with the Securities and Exchange Commission. This press release contains forward-looking
statements within the meaning of the federal securities laws. These forward-looking statements
are intended to qualify for the safe harbor from liability established by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are those that do not relate solely to
historical fact. They include, but are not limited to, any statement that may predict, forecast,
indicate or imply future results, performance, achievements or events. Words such as, but not
limited to, believe, expect, anticipate, estimate, intend, plan, target, projects,
likely, will, would, could, and similar expressions or phrases identify forward-looking
statements.
All forward-looking statements involve risk and uncertainties. In light of these risks and
uncertainties, expected results or other anticipated events or circumstances discussed in this
press release might not occur. We undertake no obligation, and specifically decline any
obligation, to publicly update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise. See the section entitled Risk Factors in our Form 10-K
filed with the SEC on February 4, 2010, and in our Form 10-Q to be filed on July 23, 2010, for a
more complete discussion of these risks and uncertainties and for other risks and uncertainties.
Those factors and the other risk factors described therein are not necessarily all of the important
factors that could cause actual results or developments to differ materially from those expressed
in any of our forward-looking statements. Other unknown or unpredictable factors also could harm
our results. Consequently, there can be no assurance that actual results or developments
anticipated by us will be realized or, even if substantially realized, that they will have the
expected consequences.
(Tables Follow)
Horizon Lines 2nd Quarter 2010 | Page 6 of 12 |
Horizon Lines, Inc.
Unaudited Condensed Consolidated Balance Sheets
(in thousands, except per share data)
Unaudited Condensed Consolidated Balance Sheets
(in thousands, except per share data)
June 20, | December 20, | |||||||
2010 | 2009 | |||||||
Assets |
||||||||
Current assets |
||||||||
Cash |
$ | 4,572 | $ | 6,419 | ||||
Accounts receivable, net of allowance of $8,082 and $7,578 at
June 20, 2010 and December 20, 2009, respectively |
130,811 | 123,536 | ||||||
Prepaid vessel rent |
12,512 | 4,580 | ||||||
Materials and supplies |
27,991 | 30,254 | ||||||
Deferred tax asset |
2,929 | 2,929 | ||||||
Other current assets |
10,251 | 9,027 | ||||||
Total current assets |
189,066 | 176,745 | ||||||
Property and equipment, net |
190,020 | 193,438 | ||||||
Goodwill |
317,068 | 317,068 | ||||||
Intangible assets, net |
93,385 | 105,405 | ||||||
Other long-term assets |
30,655 | 25,854 | ||||||
Total assets |
$ | 820,194 | $ | 818,510 | ||||
Liabilities and Stockholders Equity |
||||||||
Current liabilities |
||||||||
Accounts payable |
$ | 40,981 | $ | 43,257 | ||||
Current portion of long-term debt |
18,750 | 18,750 | ||||||
Accrued vessel rent |
| 4,339 | ||||||
Other accrued liabilities |
105,319 | 110,473 | ||||||
Total current liabilities |
165,050 | 176,819 | ||||||
Long-term debt, net of current portion |
522,043 | 496,105 | ||||||
Deferred rent |
20,349 | 22,585 | ||||||
Deferred tax liability |
4,248 | 4,248 | ||||||
Other long-term liabilities |
17,212 | 17,475 | ||||||
Total liabilities |
728,902 | 717,232 | ||||||
Stockholders equity |
||||||||
Preferred stock, $.01 par value, 30,500 shares authorized; no shares
issued or outstanding |
| | ||||||
Common stock, $.01 par value, 100,000 shares authorized, 34,470
shares issued and 30,670 shares outstanding as of June 20, 2010
and 34,091 shares issued and 30,291 shares outstanding as of
December 20, 2009 |
345 | 341 | ||||||
Treasury stock, 3,800 shares at cost |
(78,538 | ) | (78,538 | ) | ||||
Additional paid in capital |
195,802 | 196,900 | ||||||
Accumulated deficit |
(25,469 | ) | (15,874 | ) | ||||
Accumulated other comprehensive loss |
(848 | ) | (1,551 | ) | ||||
Total stockholders equity |
91,292 | 101,278 | ||||||
Total liabilities and stockholders equity |
$ | 820,194 | $ | 818,510 | ||||
Horizon Lines 2nd Quarter 2010 | Page 7 of 12 |
Horizon Lines, Inc.
Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
Quarters Ended | Six Months | |||||||||||||||
June 20, | June 21, | June 20, | June 21, | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Operating revenue |
$ | 305,585 | $ | 278,484 | $ | 591,718 | $ | 550,835 | ||||||||
Operating expense: |
||||||||||||||||
Cost of services (excluding
depreciation expense) |
256,013 | 226,339 | 508,800 | 455,998 | ||||||||||||
Depreciation and amortization |
11,203 | 11,165 | 22,218 | 22,140 | ||||||||||||
Amortization of vessel dry-docking |
3,318 | 3,609 | 6,371 | 7,407 | ||||||||||||
Selling, general and administrative |
21,890 | 28,006 | 43,591 | 55,774 | ||||||||||||
Settlement of class action lawsuit |
| 20,000 | | 20,000 | ||||||||||||
Restructuring charge |
| 213 | | 1,001 | ||||||||||||
Impairment charge |
| 659 | | 659 | ||||||||||||
Miscellaneous income, net |
(753 | ) | (300 | ) | (190 | ) | (119 | ) | ||||||||
Total operating expense |
291,671 | 289,691 | 580,790 | 562,860 | ||||||||||||
Operating income (loss) |
13,914 | (11,207 | ) | 10,928 | (12,025 | ) | ||||||||||
Other expense: |
||||||||||||||||
Interest expense, net |
10,283 | 9,254 | 20,566 | 18,686 | ||||||||||||
Loss on modification of debt |
| 50 | | 50 | ||||||||||||
Other expense, net |
6 | 11 | 6 | 10 | ||||||||||||
Income (loss) before income tax
(benefit) expense |
3,625 | (20,522 | ) | (9,644 | ) | (30,771 | ) | |||||||||
Income tax (benefit) expense |
(25 | ) | 10,561 | (50 | ) | 10,264 | ||||||||||
Net income (loss) |
$ | 3,650 | $ | (31,083 | ) | $ | (9,594 | ) | $ | (41,035 | ) | |||||
Net income (loss) per share: |
||||||||||||||||
Basic |
$ | 0.12 | $ | (1.02 | ) | $ | (0.31 | ) | $ | (1.35 | ) | |||||
Diluted |
$ | 0.12 | $ | (1.02 | ) | $ | (0.31 | ) | $ | (1.35 | ) | |||||
Number of shares used in calculation: |
||||||||||||||||
Basic |
30,595 | 30,438 | 30,558 | 30,431 | ||||||||||||
Diluted |
30,942 | 30,438 | 30,558 | 30,431 | ||||||||||||
Dividends declared per common share |
$ | 0.05 | $ | 0.11 | $ | 0.10 | $ | 0.22 | ||||||||
Horizon Lines 2nd Quarter 2010 | Page 8 of 12 |
Horizon Lines, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(in thousands)
Unaudited Condensed Consolidated Statements of Cash Flows
(in thousands)
Six Months Ended | ||||||||
June 20, | June 21, | |||||||
2010 | 2009 | |||||||
Cash flows from operating activities: |
||||||||
Net loss |
$ | (9,594 | ) | $ | (41,035 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
Depreciation |
11,899 | 11,824 | ||||||
Amortization of other intangible assets |
10,319 | 10,316 | ||||||
Amortization of vessel dry-docking |
6,371 | 7,407 | ||||||
Amortization of deferred financing costs |
1,700 | 1,209 | ||||||
Impairment charge |
| 659 | ||||||
Restructuring charge |
| 1,001 | ||||||
Loss on modification of debt |
| 50 | ||||||
Deferred income taxes |
| 10,357 | ||||||
Gain on equipment disposals |
| (291 | ) | |||||
Gain on sale of interest in joint venture |
(724 | ) | | |||||
Stock-based compensation |
1,563 | 1,919 | ||||||
Accretion of interest on 4.25% convertible notes |
5,313 | 4,905 | ||||||
Changes in operating assets and liabilities: |
||||||||
Accounts receivable |
(7,276 | ) | 663 | |||||
Materials and supplies |
2,263 | (3,070 | ) | |||||
Other current assets |
(1,224 | ) | 150 | |||||
Accounts payable |
(2,276 | ) | (3,106 | ) | ||||
Accrued liabilities |
(9,016 | ) | 12,780 | |||||
Vessel rent |
(14,115 | ) | (13,361 | ) | ||||
Vessel dry-docking payments |
(10,764 | ) | (8,593 | ) | ||||
Other assets/liabilities |
322 | (992 | ) | |||||
Net cash used in operating activities |
(15,239 | ) | (7,208 | ) | ||||
Cash flows from investing activities: |
||||||||
Purchases of property and equipment |
(5,577 | ) | (7,154 | ) | ||||
Proceeds from the sale of interest in joint venture |
1,100 | | ||||||
Proceeds from the sale of property and equipment |
234 | 853 | ||||||
Net cash used in investing activities |
(4,243 | ) | (6,301 | ) | ||||
Cash flows from financing activities: |
||||||||
Borrowing under revolving credit facility |
75,500 | 45,000 | ||||||
Payments on revolving credit facility |
(45,500 | ) | (20,000 | ) | ||||
Payments on long-term debt |
(9,375 | ) | (3,275 | ) | ||||
Dividends to stockholders |
(3,060 | ) | (6,694 | ) | ||||
Common stock issued under employee stock purchase plan |
70 | 75 | ||||||
Payments of financing costs |
| (3,406 | ) | |||||
Net cash provided by financing activities |
17,635 | 11,700 | ||||||
Net decrease in cash |
(1,847 | ) | (1,809 | ) | ||||
Cash at beginning of period |
6,419 | 5,487 | ||||||
Cash at end of period |
$ | 4,572 | $ | 3,678 | ||||
Horizon Lines 2nd Quarter 2010 | Page 9 of 12 |
Horizon Lines, Inc.
Adjusted Operating Income Reconciliation
($ in Thousands)
Adjusted Operating Income Reconciliation
($ in Thousands)
Quarter Ended | Quarter Ended | Six Months Ended | Six Months Ended | |||||||||||||
June 20, 2010 | June 21, 2009 | June 20, 2010 | June 21, 2009 | |||||||||||||
Operating Income (Loss) |
$ | 13,914 | $ | (11,207 | ) | $ | 10,928 | $ | (12,025 | ) | ||||||
Adjustments: |
||||||||||||||||
Antitrust Legal Expenses |
1,030 | 4,062 | 1,988 | 8,486 | ||||||||||||
Union Severance |
97 | | 360 | | ||||||||||||
Legal Settlement |
| 20,000 | | 20,000 | ||||||||||||
Impairment Charge |
| 659 | | 659 | ||||||||||||
Restructuring Charge |
| 213 | | 1,001 | ||||||||||||
Total Adjustments |
1,127 | 24,934 | 2,348 | 30,146 | ||||||||||||
Adjusted Operating Income |
$ | 15,041 | $ | 13,727 | $ | 13,276 | $ | 18,121 | ||||||||
Horizon Lines 2nd Quarter 2010 | Page 10 of 12 |
Horizon Lines, Inc.
Adjusted Net Income (Loss) Reconciliation
($ in Thousands)
Adjusted Net Income (Loss) Reconciliation
($ in Thousands)
Quarter Ended | Quarter Ended | Six Months Ended | Six Months Ended | |||||||||||||
June 20, 2010 | June 21, 2009 | June 20, 2010 | June 21, 2009 | |||||||||||||
Net Income (Loss) |
$ | 3,650 | $ | (31,083 | ) | $ | (9,594 | ) | $ | (41,035 | ) | |||||
Adjustments: |
||||||||||||||||
Antitrust Legal Expenses |
1,030 | 4,062 | 1,988 | 8,486 | ||||||||||||
Union Severance |
97 | | 360 | | ||||||||||||
Legal Settlement |
| 20,000 | | 20,000 | ||||||||||||
Impairment Charge |
| 659 | | 659 | ||||||||||||
Restructuring Charge |
| 213 | | 1,001 | ||||||||||||
Loss on Modification of Debt |
| 50 | | 50 | ||||||||||||
Tax Valuation Allowance |
| 10,561 | | 10,561 | ||||||||||||
Tax Impact of Adjustments |
(7 | ) | (339 | ) | (5 | ) | (302 | ) | ||||||||
Total Adjustments |
1,120 | 35,206 | 2,343 | 40,455 | ||||||||||||
Adjusted Net Income (Loss) |
$ | 4,770 | $ | 4,123 | $ | (7,251 | ) | $ | (580 | ) | ||||||
Horizon Lines 2nd Quarter 2010 | Page 11 of 12 |
Horizon Lines, Inc.
Adjusted Net Income (Loss) Per Share Reconciliation
Adjusted Net Income (Loss) Per Share Reconciliation
Quarter Ended | Quarter Ended | Six Months Ended | Six Months Ended | |||||||||||||
June 20, 2010 | June 21, 2009 | June 20, 2010 | June 21, 2009 | |||||||||||||
Net Income (Loss) Per Share |
$ | 0.12 | $ | (1.02 | ) | $ | (0.31 | ) | $ | (1.35 | ) | |||||
Adjustments Per Share: |
||||||||||||||||
Antitrust Legal Expenses |
0.03 | 0.14 | 0.06 | 0.29 | ||||||||||||
Union Severance |
| | 0.01 | | ||||||||||||
Legal Settlement |
| 0.65 | | 0.66 | ||||||||||||
Impairment Charge |
| 0.02 | | 0.02 | ||||||||||||
Restructuring Charge |
| 0.01 | | 0.03 | ||||||||||||
Tax Valuation Allowance |
0.34 | | 0.34 | |||||||||||||
Tax Impact of Adjustments |
| (0.01 | ) | | (0.01 | ) | ||||||||||
Total Adjustments |
0.03 | 1.15 | 0.07 | 1.33 | ||||||||||||
Adjusted Net Income (Loss)
Per Share |
$ | 0.15 | $ | 0.13 | $ | (0.24 | ) | $ | (0.02 | ) | ||||||
Horizon Lines 2nd Quarter 2010 | Page 12 of 12 |
Horizon Lines, Inc.
EBITDA and Adjusted EBITDA Reconciliation
($ in Thousands)
EBITDA and Adjusted EBITDA Reconciliation
($ in Thousands)
Quarter Ended | Quarter Ended | Six Months Ended | Six Months Ended | |||||||||||||
June 20, 2010 | June 21, 2009 | June 20, 2010 | June 21, 2009 | |||||||||||||
Net Income (Loss) |
$ | 3,650 | $ | (31,083 | ) | $ | (9,594 | ) | $ | (41,035 | ) | |||||
Interest Expense, Net |
10,283 | 9,254 | 20,566 | 18,686 | ||||||||||||
Tax (Benefit) Expense |
(25 | ) | 10,561 | (50 | ) | 10,264 | ||||||||||
Depreciation and
Amortization |
14,521 | 14,774 | 28,589 | 29,547 | ||||||||||||
EBITDA |
28,429 | 3,506 | 39,511 | 17,462 | ||||||||||||
Antitrust Legal Fees |
1,030 | 4,062 | 1,988 | 8,486 | ||||||||||||
Union Severance |
97 | | 360 | | ||||||||||||
Legal Settlement |
| 20,000 | | 20,000 | ||||||||||||
Impairment Charge |
| 659 | | 659 | ||||||||||||
Restructuring Charge |
| 213 | | 1,001 | ||||||||||||
Loss on Modification of Debt |
| 50 | | 50 | ||||||||||||
Adjusted EBITDA |
$ | 29,556 | $ | 28,490 | $ | 41,859 | $ | 47,658 | ||||||||
Note: EBITDA is defined as net income plus net interest expense, income taxes, depreciation
and amortization. We believe that EBITDA is a meaningful measure for investors as (i) EBITDA is a
component of the measure used by our board of directors and management team to evaluate our
operating performance, (ii) the senior credit facility contains covenants that require the Company
to maintain certain interest expense coverage and leverage ratios, w hich contain EBITDA, and (iii)
EBITDA is a measure used by our management team to make day-to-day operating decisions. Adjusted
EBITDA excludes certain charges in order to evaluate our operating performance, for making
day-to-day operating decisions and w hen determining the payment of discretionary bonuses.
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