EX-99.1 27 v089077_ex99-1.htm
EXHIBIT 99.1
 
Contact:
Bohn H. Crain
    Chief Executive Officer
    Radiant Logistics, Inc.
    (425) 943-4599
 
RADIANT LOGISTICS ANNOUNCES FOURTH QUARTER
AND YEAR END 2007 RESULTS
 

Double-Digit Growth Continues With Record Revenues of $75.5 Million:
38.3% and $20.9 Million Increase Over Pro Forma Prior Year Period
________________________________________________________________________ 

BELLEVUE, WA, October 1, 2007 - Radiant Logistics, Inc. (OTC BB: RLGT), a domestic and international freight forwarding and logistics services company, today reported financial results for the three months and year ended June 30, 2007.

For the three months ended June 30, 2007, Radiant reported a net loss of $86,000 on $23.4 million of revenues, or $0.00 per basic and fully diluted share. For the three months ended June 30, 2006, the Company had $14.7 million in revenues and net income of $98,000.

For the year ended June 30, 2007, Radiant reported net income of $163,000 on $75.5 million of revenues, or $0.00 per basic and fully diluted share. For the year ended June 30, 2006, the Company had $26.5 million in revenues and net income of $71,000. The year ended June 30, 2007 has twelve months of Airgroup operations compared to six months for the same comparable period last year as Airgroup was acquired January 1, 2006.

The Company also reported adjusted EBITDA (earnings before interest, taxes, depreciation amortization) of $347,000 for the three months ended June 30, 2007 which includes $179,000 in start-up costs associated with the launch of the Company’s international service offering, compared to adjusted EBITDA of $430,000 for the comparable prior year period. A reconciliation of our adjusted EBITDA to the most directly comparable GAAP measure appears at the end of this release.


The Company also reported adjusted EBITDA (earnings before interest, taxes, depreciation amortization) of $1,412,000 for the year ended June 30, 2007 which includes $263,000 in international start-up costs, compared to adjusted EBITDA of $552,000 for the comparable prior year period. A reconciliation of our adjusted EBITDA to the most directly comparable GAAP measure appears at the end of this release.

The Company has also provided additional prior period analysis using pro forma results of operations presented as if Radiant had acquired Airgroup as of July 1, 2005 which is included on the Company’s Form 10-K for the fiscal year ended June 30, 2007 and filed October 1, 2007.

The Company completed its platform acquisition effective January 1, 2006, when it purchased Airgroup Corporation (“Airgroup”), a Seattle, Washington-based, company providing a full range of domestic and international freight forwarding services. Founded in 1987, Airgroup services a diversified account base including manufacturers, distributors and retailers through its extensive network of exclusive agent offices across North America.

According to Company CEO, Bohn H. Crain, “Since our acquisition of Airgroup in January 2006, we have made significant progress in the build-out of our network of exclusive agency offices (growing from 34 to 42 offices), as well as enhancing our back-office infrastructure and transportation and accounting systems. We expect this trend to continue. At the same time, we continue to look for opportunities to accelerate our growth through strategic acquisitions that can add shareholder value, be comfortably financed, and offer the appropriate operating synergies and cost benefits.”

Mr. Crain continued, “We continued our trend of solid revenue growth finishing the year with another record quarter”. We posted record revenues of $23.4 million during our fourth quarter, an improvement of 59.8% over the comparable prior year period. For the same quarter ended June 30, 2007, we also posted $347,000 in adjusted EBITDA which includes $179,000 in cost incurred in the launch of our international services group. Excluding our start-up costs for the international program, our adjusted EBITDA for the most recent quarter would have been $526,000 compared to $430,000 for the quarter ended June 30, 2006.

For our fiscal year ended June 30, 2007, we generated $1.4 million of adjusted EBITDA (including $263,000 in start-up costs for international) on $75.5 million in revenues. We


generated $552,000 in adjusted EBITDA on $26.5 million in revenues for the comparable prior year period which includes only six months of Airgroup operations. On a pro forma basis, assuming we had had the benefit of Airgroup for the full twelve months for the fiscal year ended June 30, 2006, we would have generated $1.0 million of adjusted EBITDA on $54.6 million in revenues with revenue growth of $20.9 million and 38.3%; and growth in adjusted EBITDA of $400,000 and 40.0%. Excluding our start-up costs for the international program, our growth in adjusted EBITDA would have been $663,000 and 66.3%.”

Crain continued: “In addition to our progress in growing the Airgroup operations, in May of 2007 we also launched our automotive services group based in Detroit, Michigan. As part of this strategy, we entered into an agreement with Mass Financial to acquire, subject to various pre-closing conditions, certain assets formerly used in the operation of the automotive division of Stonepath Group, Inc. (the "Purchased Assets"). Concurrent with this agreement, we also entered into a Management Services Agreement (“MSA”) with Mass Financial (Mass) whereby we agreed to operate the Purchased Assets within our automotive services division during the interim period pending the ultimate closing of the transaction.

Shortly after commencing operation of the Purchased Assets pursuant to the MSA, a judgment creditor of Stonepath (the “Stonepath Creditor”) issued garnishment notices to the automotive customers being serviced by us disputing the priority of the underlying security interest of Mass in the Purchased Assets. As further detailed in our 10-K filing, although the garnishment action has been brought to a standstill, the dispute has created significant disruption within the automotive customer base and created uncertainty as to Detroit’s relative contribution moving forward. In the interim we have continued to service the automotive customers under the MSA and believe that there is a profitable core of business available to us pending resolution of the dispute as between Mass and the Stonepath Creditor. Through June 30, 2007 Radiant has incurred a loss of $196,000 in its operation of the Purchase Assets which is classified as “other long term assets” on our balance sheet which we expect to take as an offset against future payments for the Purchased Assets or we will seek reimbursement as an indemnity claim pursuant to the MSA.

In summary, the core business that we enjoy through the operation of Airgroup continues to gain strength as a result of our organic growth strategy. With Airgroup as the base, we continue to look for, and invest in new areas that we believe will add value to the platform. We expect our international program to become net contributor over the course of 2008 and we remain


optimistic that we can unlock the value of our Detroit operations. We will provide additional updates as these initiatives develop.”

Supplemental Pro Forma Information

We believe that supplemental disclosure of our adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization adjusted for stock-based compensation and other non-cash costs is a useful measure for investors because it eliminates the effect of certain non-cash costs and provides an important metric for our business. A reconciliation of adjusted EBITDA amounts to the most directly comparable GAAP measure for the three and twelve months ended June 30, 2007 and 2006 is shown below:
 
(Amounts in 000’s)  
THREE MONTHS ENDED
JUNE 30,
  
YEAR ENDED
JUNE 30,
  
SIX MONTHS ENDED
JUNE 30,
  
   
2007
  
2006
  
2007
  
2006
  
                      
Net income (loss)
  
$
(86
)
$
98
  
$
163
  
$
71
  
                           
Depreciation and amortization
    
230
   
217
    
830
    
423
  
Interest expense (income), net
    
(3
)
  
9
    
6
    
11
  
Income tax expense (benefit)
    
138
    
63
    
156
    
(39
)
                           
EBITDA
    
279
    
387
    
1,155
    
466
  
Stock-based compensation and other non-cash charges
    
68
    
43
    
257
    
86
  
  Adjusted EBITDA
 
$
347
  
$
430
  
$
1,412
  
$
552
  
                           
This supplemental pro forma financial information is presented for informational purposes only and is not a substitute for the historical financial information presented in accordance with accounting principles generally accepted in the United States.

Investor Conference Call

Radiant will host a conference call for shareholders and the investing community on Tuesday October 2 at 4:00 pm, ET to discuss the contents of the release. The call can be accessed by dialing (877) 407-8031, or (201) 689-8031 for international participants, and is expected to last


approximately 30 minutes. Callers are requested to dial in 5 minutes before the start of the call. An audio replay will be available for one week after the teleconference by dialing (877) 660-6853, or (201) 612-7415 for international callers, and using account number 286 and conference ID number 255411.
 
About Radiant Logistics (OTC BB: RLGT)
 
Radiant Logistics (www.radiant-logistics.com) is executing a strategy to build a global transportation and supply chain management company through organic growth and the strategic acquisition of regional best-of-breed non-asset based transportation and logistics providers, to offer its customers domestic and international freight forwarding and an expanding array of value added supply chain management services, including asset recovery/reverse logistics, order fulfillment, inventory management and warehousing. For more information about Radiant Logistics, please contact Bohn Crain at (425) 943-4599.

This press release includes 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, regarding future operating performance, events, trends and plans. We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions about us that may that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. While it is impossible to identify all of the factors that may cause our actual operating performance, events, trends or plans to differ materially from those set forth in such forward looking statements, we have identified certain of the more salient risk factors such factors include, but are not limited to, the level of economic activity of our current customers, our ability to attract and retain new and existing customers, competitive conditions in our industry, our ability to successfully integrate newly established stations into our network, our ability to maintain relationships with our exclusive agents, our ability to identify and secure additional financing to execute our growth strategy, and those other factors disclosed in our Report on Form 10-K under the caption "Risk Factors" and other filings with Securities and Exchange Commission and other public documents and press releases which can be found on our web-site (www.radiant-logistics.com). Readers are cautioned not to place undue reliance on our forward- looking statements, as they speak only as of the date made. Such statements are not guarantees of future performance or events and we undertake no obligation to disclose any revision to these forward-looking statement to reflect events or circumstances occurring after the date hereof.
 
 
RADIANT LOGISTICS, INC.
(f/k/a Golf Two, Inc.)
Consolidated Balance Sheets
(UNAUDITED)
 
   
June 30,
  
June 30,
  
   
2007
  
2006
  
ASSETS
          
Current assets -
      
 
  
Cash and cash equivalents
  
$
719,575
  
$
510,970
  
Accounts receivable, net of allowance for doubtful accounts of $259,960 at June 30, 2007 and $202,830 at June 30, 2006
    
15,062,910
    
8,487,899
  
Current portion of employee loan receivables and other Receivables
    
42,800
    
40,329
  
Prepaid expenses and other current assets
    
59,328
    
93,087
  
Deferred tax asset
    
234,656
    
277,417
  
Total current assets
    
16,119,269
    
9,409,702
  
 
            
Technology, furniture and equipment, net
    
844,919
    
258,119
  
Acquired intangibles, net
    
1,789,773
    
2,401,600
  
Goodwill
    
5,532,223
    
4,712,062
  
Employee loan receivable
    
80,000
    
120,000
  
Investment in real estate
    
40,000
    
40,000
  
Deposits and other assets
    
618,153
    
103,376
  
   
$
25,024,337
  
$
17,044,859
  
 
            
           
Current liabilities -
            
Notes payable
  
$
800,000
  
$
-
  
Accounts payable
    
11,619,579
    
4,096,538
  
Accrued transportation costs
    
1,651,177
    
1,501,374
  
Commissions payable
    
700,020
    
429,312
  
Other accrued costs
    
344,305
    
303,323
  
Income taxes payable
    
224,696
    
1,093,996
  
Total current liabilities
    
15,339,777
    
7,424,543
  
 
              
Long term debt
    
1,974,214
    
2,469,936
  
Deferred tax liability
    
608,523
    
816,544
  
Total liabilities
    
17,922,514
    
10,711,023
  
 
            
Minority Interest
    
57,482
    
-
  
Commitments & contingencies
    
-
    
-
  
               
Stockholders' equity:
            
Preferred stock, $0.001 par value, 5,000,000 shares authorized; no shares issued or outstanding
    
-
    
-
 
Common stock, $0.001 par value, 50,000,000 shares authorized:
issued and outstanding: 33,961,639 at June 30, 2007 and
33,611,639 at June 30, 2006
   
15,417
    
15,067
  
Additional paid-in capital
    
7,137,774
    
6,590,355
  
Accumulated deficit
    
(108,850
)
  
(271,586
)
Total Stockholders’ equity
   
7,044,341
    
6,333,836
  
   
$
25,024,337
  
$
17,044,859
  
 


 
RADIANT LOGISTICS, INC.
(f/k/a Golf Two, Inc.)
Consolidated Statements of Income (Operations)
(unaudited)
 
 
THREE MONTHS ENDED
JUNE 30,
  
TWELVE MONTHS ENDED
JUNE 30,
  
SIX MONTHS ENDED
JUNE 30,
  
   
2007
  
2006
  
2007
  
2006
  
                      
Revenue
  
$
23,371,733
  
$
14,626,332
  
$
75,526,788
  
$
26,469,049
  
Cost of transportation
    
15,455,623
    
9,486,259
    
48,812,662
    
16,965,966
  
Net revenues
    
7,916,110
    
5,140,073
    
26,714,126
    
9,503,083
  
 
                          
Agent commissions
    
5,657,820
    
3,839,654
    
20,047,536
    
7,037,363
  
Personnel costs
    
1,168,822
    
515,362
    
2,916,073
    
1,154,449
  
Selling, general and administrative expenses
    
746,757
    
395,383
    
2,507,317
    
842,391
  
Depreciation and amortization
    
230,191
    
217,362
    
830,486
    
423,465
  
  Total operating expenses
    
7,803,590
    
4,967,761
    
26,301,412
    
9,457,668
  
                           
Income (loss) from operations
    
112,520
    
172,312
    
412,714
    
45,415
  
 
                          
Other income (expense):
                          
Interest income
    
9,470
    
3,334
    
16,272
    
14,800
  
Interest expense
    
(6,366
)
  
(12,527
)
  
(22,215
)
  
(25,851
)
Other
   
(18,218
)
  
(2,773
)
  
(42,686
)
  
(2,773
)
Total other (expense)
    
(15,114
)
  
(11,966
)
  
(48,629
)
  
(13,824
)
                           
Income before income tax benefit and minority interest
    
97,406
    
160,346
    
364,085
    
31,591
  
 
                          
Income tax expense (benefit)
    
137,542
    
62,550
    
155,867
    
(39,095
)
 
                          
Income (loss) before minority interest
    
(40,136
)
  
97,796
    
208,218
    
70,686
  
                           
Minority Interest
    
45,464
    
-
    
45,482
    
-
  
                           
Net income (loss)
  
$
(85,600
)
$
97,796
  
$
162,736
  
$
70,686
  
 
                          
Net income (loss) per common share - basic
  
$
-
  
$
-
  
$
-
  
$
-
  
Net income (loss) per common share - diluted
  
$
-
  
$
-
  
$
-
  
$
-
  
                           
Weighted average shares outstanding:
                          
Basic shares
    
33,961,639
    
32,754,957
    
33,882,872
    
33,185,665
  
Diluted share
    
34,209,915
    
32,754,957
    
34,324,736
    
34,584,836
  
 
 
RADIANT LOGISTICS, INC.
Reconciliation of EBITDA to Net Income and Net Cash Provided By (Used In) Operating Activities
(UNAUDITED)

As used in this report, adjusted EBITDA means earnings before interest, income taxes, depreciation and amortization adjusted for stock-based compensation and other non-cash charges. We believe that adjusted EBITDA, as presented, represents a useful method of assessing the performance of our operating activities, as it reflects our earnings trends without the impact of certain non-cash charges. Adjusted EBITDA is also used by our creditors in assessing debt covenant compliance. We understand that although securities analysts frequently use EBITDA in their evaluation of companies, it is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. EBITDA is not intended as an alternative to cash flow provided by (used in) operating activities as a measure of liquidity, as an alternative to net income as an indicator of our operating performance, nor as an alternative to any other measure of performance in conformity with accounting principles generally accepted in the United States of America.

The following is a reconciliation of adjusted EBITDA to both net income and cash flow provided by (used in) operating activities:
 
     
THREE MONTHS ENDED
JUNE 30,
    
TWELVE MONTHS ENDED
JUNE 30,
    
SIX MONTHS ENDED
JUNE 30,
  
     
2007
    
2006
    
2007
    
2006
  
Adjusted EBITDA
  
$
347,428
  
$
429,710
  
$
1,412,213
  
$
551,726
  
Stock-based compensation and other non-cash charges
    
68,402
   
42,809
    
257,181
    
85,619
  
EBITDA
    
279,026
    
386,901
    
1,155,032
    
466,107
  
                           
Depreciation and amortization
    
230,190
    
217,362
    
830,486
    
423,465
  
Interest (income) expense, net
    
(3,104
)
  
9,193
    
5,943
    
11,051
  
Income tax expense (benefit)
    
137,540
    
62,550
    
155,867
    
(39,095
)
Net income (loss)
    
(85,600
)
  
97,796
    
162,736
    
70,686
  
                           
ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO NET CASH
                         
PROVIDED BY OPERATING ACTIVITIES:
                          
Non-cash contribution to capital (rent)
    
-
    
-
    
-
    
-
  
Non-cash contribution to common stock
   
-
    
-
    
-
    
-
  
Non-cash compensation expense (stock options)
    
52,393
    
42,809
    
194,269
    
85,619
  
Amortization of intangibles
    
152,956
    
170,200
    
611,827
    
340,400
  
Depreciation and amortization
    
77,234
    
47,162
    
218,658
    
83,065
  
Amortization of deferred tax liability
    
(51,999
)
  
(57,867
)
  
(208,015
)
  
(115,735
)
Minority interest in income of subsidiaries
    
45,465
    
-
    
45,482
    
-
 
Deferred income tax benefit
    
14,142
    
-
    
14,142
    
-
  
Amortization of employee receivable
    
-
    
-
    
40,000
    
-
 
Provision for doubtful accounts
    
33,761
    
(135,000
)
  
57,130
    
-
  
Change in purchased accounts receivable
    
-
    
225,271
    
(6,127
)
  
225,271
  
 
                          
CHANGE IN OPERATING ASSETS AND LIABILITIES:
                          
Accounts receivable
    
(3,449,239
)
  
(1,730,640
)
  
(6,632,141
)
  
1,739
  
Other receivables
    
(1,200
)
  
9,201
    
(2,471
)
  
12,230
  
Prepaid expenses and other current assets
    
(198,366
)
  
(53,223
)
  
(238,128
)
  
(116,446
)
Accounts payable
   
4,965,251
    
(285,199
)
  
7,309,007
    
(2,590,831
)
Accrued transportation costs
    
(964,921
)
  
439,012
    
149,803
    
1,501,374
  
Commissions payable
    
(276,459
)
  
521,286
    
270,708
    
9,280
  
Other current liabilities
   
189,949
    
(232,688
)
  
141,983
    
(182,677
)
Income tax payable
    
11,265
    
219,845
    
(869,300
)
  
(298,388
)
Total adjustments
    
600,232
    
(819,831
)
  
1,096,827
    
(1,045,099
)
 
                          
Net cash provided (used) by operating activities
  
$
514,632
  
$
(722,035
)
$
1,259,563
  
$
(974,413
)