Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - TRAILER BRIDGE INC | d259934d8k.htm |
| EX-10.1 - DEBTOR IN POSSESSION TERM LOAN AND SECURITIY AGREEMENT - TRAILER BRIDGE INC | d259934dex101.htm |
Exhibit 99.1
FOR IMMEDIATE RELEASE
TRAILER BRIDGE REPORTS 2011 THIRD QUARTER AND NINE MONTH FINANCIAL RESULTS
Reports Significantly Improved Operating Trends in the Second Half of 2011
Company Continues to Implement Restructuring Plan
Jacksonville, FL – November 21, 2011 — Trailer Bridge, Inc. (Nasdaq: TRBR) today announced unaudited financial results for its third quarter and nine months ended September 30, 2011 (see attached tables).
Operational Review
The Company’s primary business is to transport freight from its origination point in the continental United States to San Juan, Puerto Rico and Puerto Plata, Dominican Republic (“Southbound”) and from San Juan, Puerto Rico and Puerto Plata, Dominican Republic to its destination point in the continental United States (“Northbound”).
The Company’s Southbound vessel capacity utilization improved to 93.6% for the three months ended September 30, 2011, compared to 90.3% for the three months ended September 30, 2010 and 91.2% for the three months ended June 30, 2011. Southbound vessel capacity thus far in the fourth quarter is 103.2% with the past 5 weeks above the 100% mark.
The Company operates in an unbalanced trade lane, with the majority of freight moving Southbound from the continental United States to its two island destinations. Vessel capacity utilization Northbound to the United States was 24.8% for the three months ended September 30, 2011, compared to 25.6% for the three months ended September 30, 2010 and 24.1% for the three months ended June 30, 2011.
Comments from Management
William G. Gotimer, Jr. and Mark A. Tanner, the Company’s co-Chief Executive Officers, jointly stated, “Trailer Bridge remains committed to our employees and our shipping customers. Our recent decision to restructure the balance sheet of the Company will strengthen our ability to provide consistent service between the mainland, Puerto Rico, and the Dominican Republic. We are also seeing operating trends moving in the right direction. Through the first seven weeks in the current fourth quarter, we have seen marked improvement in all aspects of our operations, including higher revenues, and volume increases. We have achieved this in what has been a period of perceived uncertainty regarding our refinancing efforts. Our entire Company is focusing on what has made Trailer Bridge successful since its founding 20 years ago; reliably and efficiently moving freight for our customers. We have the most modern fleet in the Caribbean, and believe our value proposition to shippers provides cost-efficiencies that are valued in this economic climate. Upon the completion of this process, we expect to emerge a stronger company financially. Thanks to the support of our employees, vendors, and customers, we had no disruptions of any kind in the past week and expect to continue providing quality service to our shipper clientele.”
2011 Third Quarter Financial Review
| • | The Company had revenue of $31.1 million during the quarter, a 6.1% increase compared to $29.3 million in the prior year period, and up approximately 7.2% sequentially from the second quarter of 2011. |
| • | Trailer Bridge’s operating income for the three month period ended September 30, 2011, was $0.7 million compared to $2.5 million in the same period of the previous year. The decrease was largely due to higher inland purchased transportation, fuel, and operating and maintenance expenses during the period. |
| • | The Company reported a net loss of $1.9 million, or $0.16 per basic share and diluted share for the three months ended September 30, 2011, compared to net income of approximately $6,900, or $0.00 per basic share and diluted share, in the same period in 2010. However, this was a substantial improvement over a net loss of $3.6 million reported sequentially in the second quarter of 2011. |
| Trailer Bridge, Inc. | Page 2 | |
| November 21, 2011 |
| • | Adjusted EBITDA, as detailed in the accompanying table, was $2.4 million in the third quarter of 2011. |
Strategic Restructuring
As announced on November 16, 2011, the Company filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code upon its $82.5 million 9.25% Senior Secured Notes (“Notes”) becoming due. The Company hopes to complete this reorganization by the end of the first quarter of 2012. The Company believes that this action is the quickest and most efficient way to restructure its balance sheet and ensure the long-term strength of its operations.
Trailer Bridge has received approval from the bankruptcy court to receive $15 million in debtor-in-possession, or DIP, financing to meet its post filing obligations, and will continue operating under its usual course of business throughout the process. Trailer Bridge management again reiterates that it does not expect any reduction in its workforce or vessel deployment and will continue to provide its reliable weekly sailings between Jacksonville, Florida, and San Juan, Puerto Rico, weekly sailings between Jacksonville, Florida, and the Dominican Republic, as well as weekly inter-island service between Puerto Rico and the Dominican Republic.
The petition was filed in the U.S. Bankruptcy Court for the Middle District of Florida. Additional information and court documents related to the bankruptcy can be located at www.kccllc.net/TrailerBridge. Throughout this process, the Company is available to answer any questions that its shareholders, employees, or customers may have throughout this process.
As previously announced, the Company expects to cease trading on the Nasdaq Stock Market as of the opening of the stock market on November 28, 2011. With the filing of these financial reports, the Company now believes that it will begin trading on the OTC Bulletin Board (“OTC BB”) under the ticker symbol “TRBR”.
The Company will continue to file periodic reports with the SEC pursuant to the requirements of the Securities Exchange Act of 1934 as amended.
About Trailer Bridge, Inc.
Trailer Bridge provides integrated trucking and marine freight service to and from all points in the lower 48 states and Puerto Rico and Dominican Republic, bringing efficiency, service, security and environmental and safety benefits to domestic cargo in that traffic lane. This total transportation system utilizes its own trucks, drivers, trailers, containers and U.S. flag vessels to link the mainland with Puerto Rico via marine facilities in Jacksonville, San Juan and Puerto Plata. Additional information on Trailer Bridge is available at the www.trailerbridge.com website.
This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The matters discussed in this press release include statements regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to the future operating performance of the Company and its asset utilization. Investors are cautioned that any such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward looking statements as a result of various factors. Without limitation, these risks and uncertainties include the risks of changes in demand for transportation services offered by the Company, the Company’s ability to successfully operate its business, the Company’s ability to successfully operate and emerge from bankruptcy, maintenance of its revolving credit facility, changes in rate levels for transportation services offered by the Company, changes in the cost of fuel, unfavorable outcomes from the United States Department of Justice (“DOJ”) investigation and related individual actions, economic recessions, de-listing from the Nasdaq stock exchange, equipment and driver condition and availability and severe weather as well the ability to retain and/or attract the necessary personnel and maintain necessary vendor relationships.
(Tables to Follow)
| Trailer Bridge, Inc. | Page 3 | |
| November 21, 2011 |
TRBR INVESTOR RELATIONS COUNSEL:
The Equity Group Inc.
www.theequitygroup.com
Adam Prior
Vice President
(212) 836-9606
###
| Trailer Bridge, Inc. | Page 4 | |
| November 21, 2011 |
TRAILER BRIDGE, INC.
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
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| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| OPERATING REVENUES |
$ | 31,140,013 | $ | 29,287,787 | $ | 84,954,896 | $ | 89,789,405 | ||||||||
| OPERATING EXPENSES: |
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| Salaries, wages, and benefits |
3,657,048 | 3,554,055 | 11,287,671 | 11,767,887 | ||||||||||||
| Purchased transportation and other rent |
9,660,942 | 7,741,389 | 25,515,171 | 22,807,055 | ||||||||||||
| Fuel |
5,597,303 | 4,268,648 | 16,327,463 | 12,969,122 | ||||||||||||
| Operating and maintenance (exclusive of depreciation & dry-docking shown separately below) |
7,325,729 | 6,836,686 | 20,847,078 | 20,985,162 | ||||||||||||
| Dry-docking |
— | — | 6,900,293 | — | ||||||||||||
| Taxes and licenses |
139,123 | 183,231 | 389,853 | 498,700 | ||||||||||||
| Insurance and claims |
818,232 | 776,395 | 2,355,909 | 2,345,953 | ||||||||||||
| Communications and utilities |
215,062 | 215,431 | 602,636 | 564,975 | ||||||||||||
| Depreciation and amortization |
1,547,020 | 1,556,747 | 4,699,850 | 4,649,850 | ||||||||||||
| (Gain) loss on sale of property and equipment |
(8,950 | ) | 1,201 | (12,370 | ) | 27,398 | ||||||||||
| Other operating expenses |
1,532,012 | 1,691,974 | 4,529,147 | 5,089,746 | ||||||||||||
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| 30,483,521 | 26,825,757 | 93,442,701 | 81,705,848 | |||||||||||||
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| OPERATING INCOME (LOSS) |
656,492 | 2,462,030 | (8,487,805 | ) | 8,083,557 | |||||||||||
| NONOPERATING (EXPENSE) INCOME: |
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| Interest expense |
(2,536,143 | ) | (2,481,159 | ) | (7,418,783 | ) | (7,507,047 | ) | ||||||||
| Interest income |
1,274 | 33,205 | 4,014 | 42,127 | ||||||||||||
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| (LOSS) INCOME BEFORE PROVISION FOR INCOME TAXES |
(1,878,377 | ) | 14,076 | (15,902,574 | ) | 618,637 | ||||||||||
| PROVISION FOR INCOME TAXES |
(7,200 | ) | (7,200 | ) | (21,600 | ) | (21,870 | ) | ||||||||
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| NET (LOSS) INCOME |
$ | (1,885,577 | ) | $ | 6,876 | $ | (15,924,174 | ) | $ | 596,767 | ||||||
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| PER SHARE AMOUNTS: |
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| NET (LOSS) INCOME PER SHARE BASIC |
$ | (0.16 | ) | $ | 0.00 | $ | (1.33 | ) | $ | 0.05 | ||||||
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| NET (LOSS) INCOME PER SHARE DILUTED |
$ | (0.16 | ) | $ | 0.00 | $ | (1.33 | ) | $ | 0.05 | ||||||
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| Trailer Bridge, Inc. | Page 5 | |
| November 21, 2011 |
TRAILER BRIDGE, INC.
CONDENSED BALANCE SHEETS
(unaudited)
| September 30, 2011 |
December 31, 2010 |
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| ASSETS |
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| Current Assets: |
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| Cash and cash equivalents |
$ | — | $ | 11,481,965 | ||||
| Trade receivables, less allowance for doubtful accounts of $1,210,159 and $1,065,955 |
15,810,393 | 13,022,057 | ||||||
| Prepaid and other current assets |
4,802,462 | 2,397,948 | ||||||
| Reserve fund for debt |
4,642,006 | — | ||||||
| Deferred income taxes, net |
225,645 | 225,645 | ||||||
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| Total current assets |
25,480,506 | 27,127,615 | ||||||
| Property and equipment, net |
79,645,848 | 82,631,050 | ||||||
| Reserve fund for long-term debt |
— | 4,638,215 | ||||||
| Other assets |
439,103 | 2,004,426 | ||||||
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| TOTAL ASSETS |
$ | 105,565,457 | $ | 116,401,306 | ||||
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| LIABILITIES AND STOCKHOLDERS’ DEFICIT |
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| Current Liabilities: |
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| Accounts payable |
$ | 5,804,421 | $ | 7,411,181 | ||||
| Accrued liabilities |
5,016,278 | 4,725,030 | ||||||
| Unearned revenue |
1,870,333 | 1,410,963 | ||||||
| Current portion of long-term debt |
108,511,873 | 85,374,700 | ||||||
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| Total current liabilities |
121,202,905 | 98,921,874 | ||||||
| Long-term debt, less current portion |
— | 17,795,827 | ||||||
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| TOTAL LIABILITIES |
121,202,905 | 116,717,701 | ||||||
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| Commitments and Contingencies |
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| Stockholders’ Deficit: |
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| Preferred stock, $.01 par value, 1,000,000, shares authorized; no shares issued or outstanding |
— | — | ||||||
| Common stock, $.01 par value, 20,000,000 shares authorized; 12,102,587 shares issued; 12,016,681 shares outstanding at September 30, 2011 and December 31, 2010 |
121,026 | 121,026 | ||||||
| Treasury stock, at cost, 85,906 shares at September 30, 2011 and December 31, 2010 |
(318,140 | ) | (318,140 | ) | ||||
| Additional paid-in capital |
55,216,764 | 54,613,643 | ||||||
| Capital deficit |
(70,657,098 | ) | (54,732,924 | ) | ||||
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| TOTAL STOCKHOLDERS’ DEFICIT |
(15,637,448 | ) | (316,395 | ) | ||||
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| TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
$ | 105,565,457 | $ | 116,401,306 | ||||
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| Trailer Bridge, Inc. | Page 6 | |
| November 21, 2011 |
TRAILER BRIDGE, INC.
CONDENSED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30,
(unaudited)
| 2011 | 2010 | |||||||
| Operating activities: |
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| Net (loss) income |
$ | (15,924,174 | ) | $ | 596,767 | |||
| Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: |
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| Depreciation and amortization |
4,699,850 | 4,649,850 | ||||||
| Amortization of loan costs |
719,282 | 681,904 | ||||||
| Non-cash stock compensation expense |
603,121 | 678,214 | ||||||
| Provision for doubtful accounts |
666,864 | 686,225 | ||||||
| (Gain) loss on sale of property and equipment |
(12,370 | ) | 27,398 | |||||
| (Increase) decrease in: |
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| Trade receivables |
(3,455,201 | ) | (1,340,181 | ) | ||||
| Prepaid and other current assets |
(363,910 | ) | 227,895 | |||||
| Other assets |
12,947 | (24,925 | ) | |||||
| (Decrease) increase in: |
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| Accounts payable |
(1,606,760 | ) | 1,892,115 | |||||
| Accrued liabilities |
291,252 | (138,083 | ) | |||||
| Unearned revenue |
459,371 | (61,676 | ) | |||||
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| Net cash (used in) provided by operating activities |
(13,909,728 | ) | 7,875,503 | |||||
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| Investing activities: |
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| Purchases of property and equipment |
(1,805,989 | ) | (1,757,322 | ) | ||||
| Proceeds from sale of property and equipment |
121,819 | 96,462 | ||||||
| Additions to other assets |
— | (385,999 | ) | |||||
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| Net cash used in investing activities |
(1,684,170 | ) | (2,046,859 | ) | ||||
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| Financing activities: |
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| Proceeds from revolving line of credit |
53,699,237 | — | ||||||
| Payments on revolving line of credit |
(46,504,091 | ) | — | |||||
| Principal payments on notes payable |
(1,853,804 | ) | (3,474,695 | ) | ||||
| Payments for refinancing costs |
(1,229,409 | ) | — | |||||
| Exercise of stock options |
— | (1,013 | ) | |||||
| Purchase of treasury stock |
— | (161,113 | ) | |||||
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| Net cash provided by (used in) financing activities |
4,111,933 | (3,636,821 | ) | |||||
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| Net (decrease) increase in cash and cash equivalents |
(11,481,965 | ) | 2,191,823 | |||||
| Cash and cash equivalents, beginning of the period |
11,481,965 | 10,987,379 | ||||||
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| Cash and cash equivalents, end of period |
$ | — | $ | 13,179,202 | ||||
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| Supplemental cash flow information: |
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| Cash paid for interest |
$ | 5,746,468 | $ | 5,901,133 | ||||
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| Trailer Bridge, Inc. | Page 7 | |
| November 21, 2011 |
TRAILER BRIDGE, INC.
RECONCILIATION OF GAAP NET (LOSS) INCOME, TO EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION & AMORTIZATION; AND ADJUSTED EARNINGS BEFORE INTEREST, TAXES,
DEPRECIATION & AMORTIZATION (1)
(UNAUDITED)
| Three months ended | Three months ended | Nine months ended | Nine months ended | |||||||||||||
| September 30, 2011 | September 30, 2010 | September 30, 2011 | September 30, 2010 | |||||||||||||
| GAAP, Net (loss) income |
$ | (1,885,577 | ) | $ | 6,876 | $ | (15,924,174 | ) | $ | 596,767 | ||||||
| Net interest expense |
2,534,869 | 2,447,954 | 7,414,769 | 7,464,920 | ||||||||||||
| Provision for income taxes |
7,200 | 7,200 | 21,600 | 21,870 | ||||||||||||
| Depreciation and amortization |
1,547,020 | 1,556,747 | 4,699,850 | 4,649,850 | ||||||||||||
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| Non-GAAP, EBITDA |
$ | 2,203,512 | $ | 4,018,777 | $ | (3,787,955 | ) | $ | 12,733,407 | |||||||
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| Adjustments: |
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| Dry-docking |
— | — | 6,900,293 | — | ||||||||||||
| Stock compensation |
169,991 | 226,071 | 603,121 | 678,214 | ||||||||||||
| Severance, including officers |
— | — | 213,046 | — | ||||||||||||
| Anti-trust related legal expense |
31,842 | 116,513 | 66,471 | 641,944 | ||||||||||||
| (Gain) loss on asset sales |
(8,950 | ) | 1,201 | (12,370 | ) | 27,398 | ||||||||||
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| Total Adjustments |
192,883 | 343,785 | 7,770,561 | 1,347,556 | ||||||||||||
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| Non-GAAP, Adjusted EBITDA |
$ | 2,396,395 | $ | 4,362,562 | $ | 3,982,606 | $ | 14,080,963 | ||||||||
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| Other financial measures: |
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| EBITDA margin |
7.1 | % | 13.7 | % | (4.5 | )% | 14.2 | % | ||||||||
| Adjusted EBITDA margin |
7.7 | % | 14.9 | % | 4.7 | % | 15.7 | % | ||||||||
| Net debt to adjusted EBITDA |
17.3 | x | 4.1 | x | 17.3 | x | 4.1 | x | ||||||||
| Adjusted EBITDA to interest expense |
0.9 | x | 1.8 | x | 0.5 | x | 1.9 | x | ||||||||
Use of Non-GAAP measures
(1) The Company 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., results excluding certain costs and expenses, provides useful information for the understanding of its ongoing operations and enables investors to focus on comparisons of operating performance from period to period without the impact of significant special items. Non-GAAP measures are reconciled in the accompanying financial table. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for the Company’s reported GAAP results.
Adjusted EBITDA is calculated by adding back legal expenses associated with dry-docking, non-recurring severance charges, non-cash compensation charges, the anti-trust litigation, and loss/gain on asset sales. Adjusted EBITDA was calculated on a twelve month trailing rate for purposes of calculating net debt to adjusted EBITDA. Adjusted EBITDA for the twelve months trailing September 30, 2011 and 2010 was $6,011,962 and $20,903,032, respectively.