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Forward Air Corporation Reports Second Quarter 2011 Results

Dépèche transmise le 20 juillet 2011 par Business Wire

Forward Air Corporation Reports Second Quarter 2011 Results

Forward Air Corporation Reports Second Quarter 2011 Results

GREENEVILLE, Tenn.--(BUSINESS WIRE)--Forward Air Corporation (NASDAQ:FWRD) today reported revenue, operating income, net income and diluted earnings per share for the second quarter and six months ended June 30, 2011.

“We anticipate that our third quarter 2011 revenues will increase in the range of 6% to 10% over the comparable 2010 period, and we expect income per diluted share to be between $0.38 and $0.42 per share. This compares to $0.31 per share in the third quarter of 2010.”

Operating revenue for the quarter ended June 30, 2011 increased 8.3% to $132.2 million from $122.1 million for the same quarter in 2010. Income from operations was $19.9 million, compared with $13.5 million in the prior-year quarter. As a percent of operating revenue, income from operations increased to 15.1% from 11.1% for the same quarter last year. Net income during the period increased to $12.0 million from $7.9 million in the prior-year quarter. Income per diluted share for the second quarter of 2011 was $0.40 compared with $0.27 in the prior-year quarter.

Operating revenue for the six months ended June 30, 2011 increased 10.2% to $252.4 million from $229.1 million for the same period in 2010. Income from operations was $33.2 million, compared with $19.6 million in the prior-year period. As a percent of operating revenue, income from operations increased to 13.1% for the first six months of 2011 from 8.6% for the same period in 2010. Net income during the period was $19.8 million compared to $11.3 million in the prior-year period. Income per diluted share from operations for the first six months of 2011 was $0.67 compared with $0.39 in the prior-year period.

Bruce A. Campbell, Chairman, President, and CEO, commenting on the second quarter said, “We are pleased to announce that the hard work and dedication of our employees and independent contractors has once again produced outstanding quarterly results. In our core airport-to-airport business, our yield remained strong, which was driven in part by our June 6, 2011 general rate increase along with continued pricing discipline. Our tonnage volumes, while positive each month of the quarter, saw some periodic softness. This softness, which we view as a function of the macroeconomic environment, appears to be persisting somewhat into the third quarter.”

Commenting further, Mr. Campbell said, “Our Forward Air Solutions team continues to make steady progress by nearly cutting in half the $0.02 earnings per share deficit from a year ago. With a solid cost model and the full benefit of new business wins we fully expect Solutions to be a positive contributor to earnings in the third quarter.”

Also commenting on the quarter, Rodney L. Bell, Senior Vice President and CFO said, “On the strength of an impressive $17.3 million in cash provided by operating activities we were able to increase our cash balance by $10.4 million in the quarter. We ended the quarter with $96.1 million in cash, $50 million outstanding on our line of credit and $38.2 million of availability on our credit facility.”

Commenting on the Company’s guidance for the second quarter, Mr. Bell said, “We anticipate that our third quarter 2011 revenues will increase in the range of 6% to 10% over the comparable 2010 period, and we expect income per diluted share to be between $0.38 and $0.42 per share. This compares to $0.31 per share in the third quarter of 2010.”

Review of Financial Results

Forward Air will hold a conference call to discuss second quarter 2011 results on Thursday, July 21, 2011 at 9:00 a.m. EDT. The Company’s conference call will be available online at www.forwardair.com or by dialing 800.841.9385, pass code 15649968. A replay of the conference call will be available at www.forwardair.com beginning shortly after the completion of the live call.

About Forward Air Corporation

Forward Air Corporation operates two business segments, Forward Air, Inc. and Forward Air Solutions, Inc.

Forward Air, Inc. is a high-service-level contractor to the air cargo industry providing time-definite ground transportation services through a network of terminals located on or near major airports in 84 cities in the United States and Canada. It provides these services as a cost-effective alternative to air transportation of cargo that must be delivered at a specific time but is relatively less time-sensitive than traditional air freight or when air transportation is not economical.

Forward Air Solutions, Inc. is a provider of pool distribution services. Pool distribution involves the consolidation and shipment of several smaller less-than-truckload shipments to a common area or region. Once at the regional destination, the loads are deconsolidated, then grouped with other shipments with common delivery points, and delivered in a very precise, time-sensitive manner. Our pool distribution network consists of terminals and service locations in 19 cities within the Mid-Atlantic, Southeast, Midwest and Southwestern United States.

 
Forward Air Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
   
  Three months ended Six months ended
June 30,   June 30, June 30, June 30,
2011 2010 2011 2010
Operating revenue:
Forward Air
Airport-to-airport $ 91,493 $ 81,741 $ 173,640 $ 152,628
Logistics 18,005 17,160 34,500 31,015
Other 6,871 6,389 13,274 12,264
Forward Air Solutions
Pool distribution   15,823   16,842   30,980   33,201
Total operating revenue 132,192 122,132 252,394 229,108
 
Operating expenses:
Purchased transportation
Forward Air
Airport-to-airport 35,675 32,501 68,269 61,300
Logistics 13,373 13,071 26,173 23,839
Other 1,659 1,616 3,132 3,108
Forward Air Solutions
Pool distribution   3,502   3,503   6,958   6,945
Total purchased transportation 54,209 50,691 104,532 95,192
Salaries, wages and employee benefits 31,439 33,167 61,934 63,837
Operating leases 6,705 6,252 13,411 12,880
Depreciation and amortization 5,222 5,107 10,304 10,055
Insurance and claims 1,845 2,106 4,020 4,437
Fuel expense 2,564 2,044 4,952 4,102
Other operating expenses   10,332   9,263   20,079   19,048
Total operating expenses   112,316   108,630   219,232   209,551
Income from operations 19,876 13,502 33,162 19,557
 
Other income (expense):
Interest expense (141 ) (181 ) (336 ) (366 )
Other, net   31   (19 )   47   11
Total other expense   (110 )   (200 )   (289 )   (355 )
Income before income taxes 19,766 13,302 32,873 19,202
Income taxes   7,797   5,390   13,035   7,871
Net income $ 11,969 $ 7,912 $ 19,838 $ 11,331
 
Net income per share:
Basic $ 0.41 $ 0.27 $ 0.68 $ 0.39
Diluted $ 0.40 $ 0.27 $ 0.67 $ 0.39
Weighted average shares outstanding:
Basic 29,337 28,973 29,236 28,962
Diluted 29,851 29,119 29,618 29,093
 
Dividends per share: $ 0.07 $ 0.07 $ 0.14 $ 0.14
 

 
Forward Air Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
       
June 30, December 31,
2011 2010 (a)
Assets
Current assets:
Cash $ 96,119 $ 74,504
Accounts receivable, net 69,779 62,763
Other current assets   10,053   8,696
Total current assets 175,951 145,963
 
Property and equipment 221,715 213,704
Less accumulated depreciation and amortization   88,517   87,272
Total property and equipment, net 133,198 126,432
Goodwill and other acquired intangibles:
Goodwill 43,332 43,332
Other acquired intangibles, net   28,963   31,259
Total goodwill and other acquired intangibles 72,295 74,591
Other assets   1,535   1,810
Total assets $ 382,979 $ 348,796
 
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable $ 15,354 $ 10,687
Accrued expenses 17,933 16,280
Current portion of debt and capital lease obligations   583   638
Total current liabilities 33,870 27,605
 
Debt and capital lease obligations, less current portion 50,611 50,883
Other long-term liabilities 7,782 8,106
Deferred income taxes 7,980 6,116
 
Shareholders’ equity:
Common stock 294 290
Additional paid-in capital 35,231 24,300
Retained earnings   247,211   231,496
Total shareholders’ equity   282,736   256,086
Total liabilities and shareholders’ equity $ 382,979 $ 348,796
 

(a) Taken from audited financial statements, which are not presented in their entirety.

 

 
Forward Air Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
   
Three months ended
June 30, June 30,
2011 2010
Operating activities:
Net income $ 11,969 $ 7,912
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization 5,222 5,107
Share-based compensation 1,512 1,618
Gain on disposal of property and equipment (21 ) (8 )
Provision for loss on receivables 22 134
Provision for revenue adjustments 449 414
Deferred income taxes 1,919 (791 )
Tax benefit for stock options exercised (131 ) (5 )
Changes in operating assets and liabilities
Accounts receivable (1,863 ) (5,664 )
Prepaid expenses and other current assets (864 ) (2,400 )
Accounts payable and accrued expenses (874 ) 2,402
Net cash provided by operating activities 17,340 8,719
 
Investing activities:
Proceeds from disposal of property and equipment 388 22
Purchases of property and equipment (8,112 ) (3,313 )
Other   (7 )   (69 )
Net cash used in investing activities (7,731 ) (3,360 )
 
Financing activities:
Payments of debt and capital lease obligations (157 ) (229 )
Proceeds from exercise of stock options 2,793 106
Payments of cash dividends (2,066 ) (2,028 )
Common stock issued under employee stock purchase plan 128 91
Tax benefit for stock options exercised   131   5
Net cash provided by (used in) financing activities   829   (2,055 )
Net increase in cash 10,438 3,304
Cash at beginning of period   85,681   44,612
Cash at end of period $ 96,119 $ 47,916
 

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Forward Air Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
   
Six Months Ended
June 30, June 30,
2011 2010
Operating activities:
Net income $ 19,838 $ 11,331
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization 10,304 10,055
Share-based compensation 2,955 3,381
Gain on disposal of property and equipment -- (7 )
Provision for (recovery) loss on receivables (28 ) 224
Provision for revenue adjustments 933 837
Deferred income taxes 1,939 (1,664 )
Tax benefit for stock options exercised (219 ) (9 )
Changes in operating assets and liabilities
Accounts receivable (7,921 ) (8,882 )
Prepaid expenses and other current assets (1,745 ) (614 )
Accounts payable and accrued expenses 6,503 4,259
Net cash provided by operating activities 32,559 18,911
 
Investing activities:
Proceeds from disposal of property and equipment 667 42
Purchases of property and equipment (15,441 ) (8,739 )
Other   301   (30 )
Net cash used in investing activities (14,473 ) (8,727 )
 
Financing activities:
Payments of debt and capital lease obligations (328 ) (490 )
Proceeds from exercise of stock options 7,631 144
Payments of cash dividends (4,121 ) (4,057 )
Common stock issued under employee stock purchase plan