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8-K - FORM 8-K - Roadrunner Transportation Systems, Inc. | c24108e8vk.htm |
Exhibit 99.1
FOR IMMEDIATE RELEASE
ROADRUNNER TRANSPORTATION SYSTEMS REPORTS
2011 THIRD QUARTER RESULTS
2011 THIRD QUARTER RESULTS
Cudahy, WI November 2, 2011 Roadrunner Transportation Systems, Inc. (NYSE: RRTS), a leading
asset-light transportation and logistics services provider, today reported financial results for
the three and nine months ended September 30, 2011.
Roadrunners summary financial results for the three and nine months ended September 30 are
highlighted below. Third quarter diluted income per share available to common stockholders
increased 64.3% over the prior year. Excluding acquisition transaction expenses of $0.6 million
related to the August 2011 acquisition of Prime Logistics Corporation (Prime), diluted income per
share would have been $0.24.
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(In thousands, except per share data) | 2011 | 2010 | 2011 | 2010 (1) | ||||||||||||
Total revenues |
$ | 226,193 | $ | 163,690 | $ | 605,622 | $ | 466,222 | ||||||||
Net revenues (total revenues less
purchased transportation costs) |
$ | 60,672 | $ | 35,061 | $ | 153,336 | $ | 102,490 | ||||||||
Depreciation and amortization |
1,499 | 747 | 3,381 | 2,364 | ||||||||||||
Other operating expenses |
45,761 | 26,328 | 116,157 | 75,137 | ||||||||||||
Acquisition transaction expenses |
618 | 57 | 938 | 389 | ||||||||||||
IPO related expenses |
| 1,500 | ||||||||||||||
Operating income |
$ | 12,794 | $ | 7,929 | $ | 32,860 | $ | 23,100 | ||||||||
Net income (loss) available to common
stockholders |
$ | 7,175 | $ | 4,384 | $ | 19,006 | $ | (1,051 | ) | |||||||
Weighted average diluted shares
outstanding |
31,758 | 31,089 | 31,576 | 24,316 | ||||||||||||
Diluted income (loss) per share available
to common stockholders |
$ | 0.23 | $ | 0.14 | $ | 0.60 | $ | (0.04 | ) |
(1) | Results for the nine months ended September 30, 2010 include a one-time loss on early
extinguishment of debt of $15.9 million and $1.5 million of expenses related to our initial public
offering in May 2010. |
2011 Third Quarter Results
In discussing third quarter performance, Mark DiBlasi, President and CEO of Roadrunner, said,
Revenues increased 38.2% and net revenues expanded 73.1% from the prior year, resulting primarily
from new customer growth, pricing initiatives, fuel increases, and the inclusion of the
acquisitions of Morgan Southern and Prime. Our operating income growth of 61.4% outpaced revenue
growth despite the effects of higher fuel prices on revenues and operating costs. Record third
quarter revenue and operating income was achieved in all three operating segments.
LTL revenues increased $19.0 million, or 17.7%, from the prior year as a result of new customer
growth and expansion into new markets. This new customer growth and market expansion during the
third quarter also drove a tonnage increase of 6.0% over the prior year. Tonnage growth was flat
during July as a result of sluggish freight demand, but rebounded during August and September with
increases in excess of 8.0%. Revenue per hundredweight increased 10.6% over the prior year,
including 6.4% related to fuel. During the third quarter our LTL operating expenses increased $2.6
million over prior year primarily due to: (i) higher insurance costs, (ii) increased dock labor
costs due to increased tonnage and (iii) expanded infrastructure costs to support our new business
initiatives. Our LTL operating ratio improved to 94.8% in the third quarter from 95.2% in the prior
year quarter but our third quarter operating ratio rose slightly from 94.4% in the second quarter
of 2011. While our initiatives to penetrate new customers and expand into new geographic regions
impacted our operating ratio in the quarter primarily as a result of building density in specific
lanes, we expect these initiatives to improve our operating ratio and drive positive tonnage growth
in future quarters.
TL revenues grew by $40.2 million, or 102.9%, from the prior year. Revenues from Morgan Southern
(acquired in early February), Bruenger Trucking (acquired at the end of May) and Prime (acquired at
the end of August) accounted for $33.5 million of the increase, with the balance of $6.7 million
representing organic growth of 17.1%. The impact of the acquisitions and operating leverage
associated with our revenue growth led to nearly a three-fold increase in our TL operating income
and an improvement in our TL operating ratio to 92.9% from 96.0% in the third quarter of 2010.
For our TMS business, continued organic growth during the quarter generated a $3.7 million, or
20.6%, increase in revenues and a 33.6% increase in operating income from the prior year. This
growth drove improvement in our TMS operating ratio to 89.0% from 90.0% in the prior year.
2011 Third Quarter Segment Information
Roadrunner has three operating segments: less-than-truckload (LTL), truckload and logistics (TL)
and transportation management solutions (TMS). The following highlights exclude intercompany
eliminations and corporate expenses.
LTL revenues including fuel increased 17.7% to $126.2 million for the third quarter of 2011 from
$107.2 million for the third quarter of 2010. LTL net revenues for the third quarter of 2011 were
$29.6 million, or 23.4% of LTL revenues, compared to $25.6 million, or 23.9% of LTL revenues, for
the third quarter of 2010. The decline in net revenue margin was a result of rising fuel prices and
the impact of market expansion initiatives. LTL operating income was $6.5 million, or 5.2% of LTL
revenues, for the third quarter of 2011 compared to $5.2 million, or 4.8% of revenues, for the
third quarter of 2010.
Summary LTL operating statistics for the three and nine months ended September 30 are shown below.
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||
% | % | |||||||||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | |||||||||||||||||||
Operating ratio |
94.8 | % | 95.2 | % | (0.4 | %) | 94.5 | % | 94.3 | % | 0.3 | % | ||||||||||||
Tonnage (in thousands of tons) |
337.2 | 318.1 | 6.0 | % | 949.5 | 917.6 | 3.5 | % | ||||||||||||||||
Shipments (in thousands) |
512.5 | 481.9 | 6.3 | % | 1,434.5 | 1,373.8 | 4.4 | % | ||||||||||||||||
Revenue per hundredweight (incl. fuel) |
$ | 18.34 | $ | 16.58 | 10.6 | % | $ | 18.10 | $ | 16.36 | 10.6 | % | ||||||||||||
Revenue per hundredweight (excl. fuel) |
$ | 15.01 | $ | 14.41 | 4.2 | % | $ | 14.87 | $ | 14.18 | 4.9 | % | ||||||||||||
Weight per shipment (lbs.) |
1,316 | 1,320 | (0.3 | %) | 1,324 | 1,336 | (0.9 | %) | ||||||||||||||||
Linehaul cost per mile (excl. fuel) |
$ | 1.25 | $ | 1.26 | (0.8 | %) | $ | 1.24 | $ | 1.21 | 2.5 | % |
Note: Other than operating ratio, the statistics above do not include (i) adjustments for
undelivered freight required for financial statement purposes in accordance with RRTS revenue
recognition policy; and (ii) non-LTL related business captured within the LTL segment.
For the TL segment, revenues increased 102.9% to $79.3 million for the third quarter of 2011 from
$39.1 million for the third quarter of 2010. The improvement was primarily due to increases in
market pricing and load growth, the expansion of the companys TL brokerage agent network, and the
acquisitions of Morgan Southern, Bruenger Trucking and Prime. For the third quarter, Morgan
Southern, Bruenger Trucking and Prime collectively contributed revenues of $33.5 million to the TL
segment. Overall, TL net revenues for the third quarter of 2011 were $25.6 million, or 32.3% of TL
revenues, compared to $4.5 million, or 11.6% of TL revenues, for the third quarter of 2010. TL
operating income was $5.6 million, or 7.1% of TL revenues, for the third quarter of 2011 compared
to $1.6 million, or 4.0% of revenues, for the third quarter of 2010.
For the TMS segment, revenues for the third quarter of 2011 increased 20.6% to $21.70 million from
$18.0 million for the third quarter of 2010. TMS net revenues for the third quarter of 2011 were
$5.4 million, or 25.1% of TMS revenues, compared to $5.0 million, or 27.6% of TMS revenues, for the
third quarter of 2010. The improvement in TMS revenue growth during the quarter was primarily
attributable to new and existing customer growth. The decline in net revenue margin was a result of
rising fuel prices and increased carrier costs. TMS operating income was $2.4 million, or 11.0% of
TMS revenues, for the third quarter of 2011, compared to $1.8 million, or 10.0% of TMS revenues,
for the third quarter of 2010.
Conference Call
A conference call is scheduled for Wednesday, November 2, 2011 at 4:30 p.m. Eastern Time. To access
the conference call, please dial 866-783-2140 (U.S.) or 857-350-1599 (International) approximately
10 minutes prior to the start of the call. Callers will be prompted for passcode 26717647. The
conference call will also be available via live webcast under the Investor Relations section of the
Companys website, www.rrts.com.
If you are unable to listen to the live call, a replay will be available through November 9, 2011,
and can be accessed by dialing 888-286-8010 (U.S.) or 617-801-6888 (International). Callers will be
prompted for passcode 25619192. An archived version of the webcast will also be available under the
Investor Relations section of the Companys website, www.rrts.com.
About Roadrunner Transportation Systems, Inc.
Roadrunner is a leading asset-light transportation and logistics services provider offering a full
suite of solutions, including customized and expedited less-than-truckload, truckload and
logistics, transportation management solutions, intermodal solutions, and domestic and
international air. For more information, please visit RRTS
website, www.rrts.com.
Safe Harbor Statement
This release contains forward-looking statements that relate to future events or performance. These
statements reflect the companys current expectations, and the company does not undertake to update
or revise these forward-looking statements, even if experience or future changes make it clear that
any projected results expressed or implied in this or other company statements will not be
realized. Furthermore, readers are cautioned that these statements involve risks and uncertainties,
many of which are beyond the companys control, which could cause actual results to differ
materially from the forward-looking statements. These risks and uncertainties include, but are not
limited to, risks related to the integration of acquired companies, competition in the
transportation industry, the impact of the current economic environment, the companys dependence
upon purchased power, the unpredictability of and potential fluctuation in the price and
availability of fuel, the effects of governmental and environmental regulations, and other Risk
Factors set forth in the companys most recent SEC filings.
(Tables Follow)
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Revenues |
$ | 226,193 | $ | 163,690 | $ | 605,622 | $ | 466,222 | ||||||||
Operating expenses: |
||||||||||||||||
Purchased transportation costs |
165,521 | 128,629 | 452,286 | 363,732 | ||||||||||||
Personnel and related benefits |
23,598 | 15,826 | 61,656 | 45,514 | ||||||||||||
Other operating expenses |
22,163 | 10,502 | 54,501 | 29,623 | ||||||||||||
Depreciation and amortization |
1,499 | 747 | 3,381 | 2,364 | ||||||||||||
Acquisition transaction expenses |
618 | 57 | 938 | 389 | ||||||||||||
IPO related expenses |
| | | 1,500 | ||||||||||||
Total operating expenses |
213,399 | 155,761 | 572,762 | 443,122 | ||||||||||||
Operating income |
12,794 | 7,929 | 32,860 | 23,100 | ||||||||||||
Interest expense: |
||||||||||||||||
Interest on long-term debt |
1,172 | 504 | 2,056 | 7,752 | ||||||||||||
Dividends on preferred stock subject to mandatory redemption |
50 | 50 | 150 | 150 | ||||||||||||
Total interest expense |
1,222 | 554 | 2,206 | 7,902 | ||||||||||||
Loss on early extinguishment of debt |
| | | 15,916 | ||||||||||||
Income (loss) before (benefit) provision for income taxes |
11,572 | 7,375 | 30,654 | (718 | ) | |||||||||||
Provision (benefit) for income taxes |
4,397 | 2,991 | 11,648 | (432 | ) | |||||||||||
Net income (loss) |
7,175 | 4,384 | 19,006 | (286 | ) | |||||||||||
Accretion of Series B preferred stock |
| | | 765 | ||||||||||||
Net income (loss) available to common stockholders |
$ | 7,175 | $ | 4,384 | $ | 19,006 | $ | (1,051 | ) | |||||||
Earnings (loss) per share available to common stockholders: |
||||||||||||||||
Basic |
$ | 0.23 | $ | 0.15 | $ | 0.63 | $ | (0.04 | ) | |||||||
Diluted |
$ | 0.23 | $ | 0.14 | $ | 0.60 | $ | (0.04 | ) | |||||||
Weighted average common stock outstanding: |
||||||||||||||||
Basic |
30,562 | 30,052 | 30,340 | 24,316 | ||||||||||||
Diluted |
31,758 | 31,089 | 31,576 | 24,316 | ||||||||||||
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands, except share amounts)
September 30, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS |
||||||||
CURRENT ASSETS: |
||||||||
Cash and cash equivalents |
$ | 2,347 | $ | 996 | ||||
Accounts receivable, net |
107,581 | 73,222 | ||||||
Deferred income taxes |
4,038 | 6,367 | ||||||
Prepaid expenses and other current assets |
13,375 | 10,414 | ||||||
Total current assets |
127,341 | 90,999 | ||||||
PROPERTY AND EQUIPMENT, NET |
24,265 | 6,894 | ||||||
OTHER ASSETS: |
||||||||
Goodwill |
368,698 | 246,888 | ||||||
Other noncurrent assets |
12,110 | 3,516 | ||||||
Total other assets |
380,808 | 250,404 | ||||||
TOTAL ASSETS |
$ | 532,414 | $ | 348,297 | ||||
LIABILITIES AND STOCKHOLDERS INVESTMENT |
||||||||
CURRENT LIABILITIES: |
||||||||
Current maturities of long-term debt |
$ | 14,000 | $ | | ||||
Accounts payable |
52,220 | 37,241 | ||||||
Accrued expenses and other liabilities |
23,997 | 11,375 | ||||||
Total current liabilities |
90,217 | 48,616 | ||||||
LONG-TERM DEBT, net of current maturities |
131,636 | 20,500 | ||||||
OTHER LONG-TERM LIABILITIES |
16,628 | 8,492 | ||||||
PREFERRED STOCK SUBJECT TO MANDATORY REDEMPTION |
5,000 | 5,000 | ||||||
Total liabilities |
243,481 | 82,608 | ||||||
STOCKHOLDERS INVESTMENT: |
||||||||
Common stock $.01 par value; 100,000 shares authorized;
30,705 and 30,147 shares issued and outstanding |
301 | 301 | ||||||
Additional paid-in capital |
266,326 | 262,088 | ||||||
Retained earnings |
22,306 | 3,300 | ||||||
Total stockholders investment |
288,933 | 265,689 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS INVESTMENT |
$ | 532,414 | $ | 348,297 | ||||
Contact
Roadrunner Transportation Systems, Inc.
Peter Armbruster
Chief Financial Officer
414-615-1648
Peter Armbruster
Chief Financial Officer
414-615-1648
Vollrath Associates, Inc.
Marilyn Vollrath
414-221-0210
ir@rrts.com
Marilyn Vollrath
414-221-0210
ir@rrts.com