EX-99.1 2 c99400exv99w1.htm PRESS RELEASE exv99w1
 

Exhibit 99.1
(SCS LOGO)
October 25, 2005
SCS Transportation, Inc. Reports Third-Quarter EPS of $0.47
KANSAS CITY, Mo. – SCS Transportation, Inc. (NASDAQ: SCST), today reported third-quarter revenue of $284.5 million, up 11 percent from $256.8 million in the third quarter of 2004. Consolidated operating income for the third quarter was $13.9 million, up 3 percent from the prior-year quarter. Net income was $7.0 million, up 7 percent from $6.6 million in the third quarter of 2004. Earnings per share were $0.47, a 9 percent increase compared with $0.43 a year earlier.
“We achieved record consolidated revenues and earnings in the quarter, despite weather challenges in our historically important Gulf Coast markets,” said Bert Trucksess, chairman, president and chief executive officer of SCS Transportation. “We believe ongoing initiatives provide further opportunity for revenue and profitability improvements.”
The current-quarter and year-earlier operating results were subject to several unusual items:
    Hurricanes Katrina and Rita caused property damage and disrupted operations, which adversely impacted third-quarter consolidated results. The company has not completed an assessment of business interruption impact and third-quarter results do not include an estimate of insurance recovery, which we anticipate in a future period.
 
    Current-quarter results also include a charge of $0.8 million, or $0.03 per share, for executive severance costs.
 
    Third-quarter 2004 results at Jevic included a $1.9 million charge, which resulted from unfavorable development of prior-year workers’ compensation claims, partially offset by a $0.6 million gain on the sale of excess real estate, for a net unfavorable impact of $0.05 per share.
Update on Operating Companies
Saia
    Revenue increased 15 percent to $198.8 million versus the prior-year quarter.
 
    LTL tonnage increased 7 percent from the prior year.
 
    Operating income rose 27 percent to $13.4 million, for an operating ratio of 93.3 percent.
“Saia’s momentum in growth and profitability improvement continued, despite significant impact from Hurricanes Katrina and Rita,” Trucksess said. “Saia is focused on capitalizing on industry consolidation opportunities, while they continue to evaluate future geographic expansion.”

 


 

SCS Transportation Third-Quarter 2005 Earnings   October 25, 2005
Page 2 of 3    
Jevic
    Revenue was $85.7 million, up 1 percent from 2004.
 
    Tonnage weakness continued, with tonnage down 4 percent versus 2004.
 
    Operating income was $1.4 million, for an operating ratio of 98.4 percent.
“Jevic’s priority is to improve profitability and we are pleased with the early progress under Dave Gorman’s new leadership,” Trucksess said. “Key initiatives focus on the basic fundamentals of growing LTL tonnage, improving cost effectiveness and improving revenue quality.”
Financial Position and Outlook
Total debt at September 30, 2005, was $125.8 million and debt to total capital stood at 36.6 percent.
The Company expects net capital expenditures of approximately $65 to $75 million in 2005. Net capital expenditures year-to-date were $42.4 million. As of September 30, 2005, the Company has acquired 724,900 shares at a cost representing 64 percent of its $20 million stock repurchase program.
Year-to-date earnings per share are $1.10. Third-quarter trends, seasonally adjusted and without unusual items, are continuing early in the fourth quarter. Consistent with recent past practice of not providing individual quarterly guidance, the Company is not providing guidance on the fourth quarter and thus the full calendar year. Further, the Company intends to discontinue the practice of providing annual earnings guidance, in favor of offering long-term perspectives on business rather than shorter-term numerical ranges.
Conference Call
SCST will hold a conference call to discuss third-quarter results on Wednesday, October 26, 2005, at 9:30 a.m. Eastern Time (8:30 a.m. Central Time). To participate in the call, please dial 1-800-275-8866 or dial 1-706-634-4936 for international calls. Callers should dial in five to 10 minutes in advance of the conference call. This call will be webcast live via the company web site at www.scstransportation.com and will be archived on the site. A replay of the call will be available two hours after the completion of the call through November 2, 2005. The replay is available by dialing 1-800-642-1687 and using conference code 1163793.
The webcast is also being distributed over CCBN’s Investor Distribution Network to both institutional and individual investors. Individual investors can listen to the call through CCBN’s individual investor center at www.companyboardroom.com or by visiting any of the investor sites in CCBN’s Individual Investor Network. Institutional investors can access the call via CCBN’s password-protected event management site, StreetEvents (www.streetevents.com).
SCS Transportation, Inc. provides trucking transportation and supply chain solutions to a broad base of customers across the United States. With annual revenue exceeding $1 billion, the

 


 

SCS Transportation Third-Quarter 2005 Earnings   October 25, 2005
Page 3 of 3    
Company focuses on regional and interregional less-than-truckload (LTL), and selected truckload (TL) and time-definite services. Operating subsidiaries are Saia, a multi-region LTL carrier based in Duluth, Ga., and Jevic, a hybrid LTL and truckload carrier based in Delanco, N.J. Headquartered in Kansas City, Mo., SCST has approximately 9,000 employees nationwide.
The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand the future prospects of a company and make informed investment decisions. This news release contains these types of statements, which are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.
Words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “may,” “plan,” “predict,” “believe” and similar words or expressions are intended to identify forward-looking statements. We use such forward-looking statements regarding our future financial condition and results of operations and our business operations in this release. Investors should not place undue reliance on such forward-looking statements, and the Company undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements reflect the present expectation of future events of our management and are subject to a number of important factors, risks, uncertainties and assumptions that could cause actual results to differ materially from those described in the forward-looking statements. These factors and risks include, but are not limited to, general economic conditions; labor relations; cost and availability of qualified drivers, fuel, purchased transportation, insurance coverage, property, revenue equipment and other operating assets; governmental regulations, including but not limited to Hours of Service, engine emissions, compliance with recent legislation requiring companies to evaluate their internal control over financial reporting and Homeland Security; dependence on key employees; inclement weather; integration risks; effectiveness of company-specific performance improvement initiatives; competitive initiatives and pricing pressures including fuel surcharges and other accessorials; terrorism risks; insurance claim recoveries, self-insurance claims, equity-based compensation and other expense volatility; the Company’s determination from time to time whether to purchase any shares under the repurchase program; and other financial, operational and legal risks and uncertainties detailed from time to time in the Company’s SEC filings.
# # #
     
CONTACT:
  Greg Drown
 
  Treasurer
 
  SCS Transportation
 
  816-714-5906
 
  gdrown@scstransportation.com
 
   
 
  Dick Johnson
 
  Johnson Strategic Communications Inc.
 
  913-649-8885
 
  dick@johnsonstrategic.com

 


 

SCS Transportation, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Amounts in thousands)
(Unaudited)
                 
    September 30,     December 31,  
    2005     2004  
ASSETS
               
 
               
CURRENT ASSETS:
               
Cash and cash equivalents
  $ 3,943     $ 7,499  
Accounts receivable
    141,927       110,044  
Prepaid expenses and other
    34,214       35,721  
 
           
Total current assets
    180,084       153,264  
 
               
PROPERTY AND EQUIPMENT:
               
Cost
    602,037       569,526  
Less: Accumulated depreciation
    269,849       248,914  
 
           
Net property and equipment
    332,188       320,612  
 
               
GOODWILL AND OTHER ASSETS
    34,457       34,862  
 
           
Total assets
  $ 546,729     $ 508,738  
 
           
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
 
               
CURRENT LIABILITIES:
               
Accounts payable and checks outstanding
  $ 52,749     $ 33,193  
Wages and employees’ benefits
    42,401       35,761  
Other current liabilities
    35,201       28,981  
Current portion of long-term debt
    2,500       1,263  
 
           
Total current liabilities
    132,851       99,198  
 
               
OTHER LIABILITIES:
               
Long-term debt
    123,281       121,547  
Deferred income taxes
    51,951       57,662  
Claims, insurance and other
    21,110       17,789  
 
           
Total other liabilities
    196,342       196,998  
 
               
SHAREHOLDERS’ EQUITY:
               
Common stock
    15       15  
Additional paid-in capital
    207,066       205,800  
Treasury stock
    (12,721 )      
Deferred compensation trust
    (1,411 )     (1,116 )
Retained earnings
    24,587       7,843  
 
           
Total shareholders’ equity
    217,536       212,542  
 
           
Total liabilities and shareholders’ equity
  $ 546,729     $ 508,738  
 
           


 

SCS Transportation, Inc. and Subsidiaries
Consolidated Income Statements
Forthe Quarter and Nine Months Ended September 30, 2005 and 2004
(Amounts in thousands, except per share data)
(Unaudited)
                                 
    Third Quarter     Nine Months  
    2005     2004     2005     2004  
OPERATING REVENUE
  $ 284,537     $ 256,824     $ 809,711     $ 730,332  
 
                               
OPERATING EXPENSES:
                               
Salaries, wages and employees’ benefits
    152,651       143,074       440,169       408,300  
Purchased transportation
    26,656       25,241       71,473       68,817  
Operating expenses and supplies
    61,843       48,461       170,525       136,096  
Operating taxes and licenses
    10,531       9,583       31,566       28,076  
Claims and insurance
    7,107       6,074       25,789       21,071  
Depreciation and amortization
    12,253       12,180       36,129       35,957  
Operating (gains) and losses
    (378 )     (1,305 )     (1,295 )     (1,734 )
Integration charges
                      2,054  
 
                       
Total operating expenses
    270,663       243,308       774,356       698,637  
 
                       
 
                               
OPERATING INCOME
    13,874       13,516       35,355       31,695  
 
                               
NONOPERATING EXPENSES:
                               
Interest expense
    2,388       2,489       7,239       7,296  
Other, net
    (137 )     (19 )     (120 )     (146 )
 
                       
Nonoperating expenses, net
    2,251       2,470       7,119       7,150  
 
                               
INCOME BEFORE INCOME TAXES
    11,623       11,046       28,236       24,545  
Income tax provision
    4,641       4,494       11,492       9,913  
 
                       
NET INCOME
  $ 6,982     $ 6,552     $ 16,744     $ 14,632  
 
                       
 
                               
Average common shares outstanding — basic
    14,499       14,910       14,815       14,830  
 
                       
 
                               
Average common shares outstanding — diluted
    14,828       15,345       15,158       15,300  
 
                       
 
                               
Basic earnings per share
  $ 0.48     $ 0.44     $ 1.13     $ 0.99  
 
                       
 
                               
Diluted earnings per share
  $ 0.47     $ 0.43     $ 1.10     $ 0.96  
 
                       


 

SCS Transportation, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
For the Nine Months Ended September 30, 2005 and 2004
(Amounts in thousands)
(Unaudited)
                 
    2005     2004  
OPERATING ACTIVITIES:
               
Net cash from operating activities
  $ 48,181     $ 43,453  
 
               
INVESTING ACTIVITIES:
               
Acquisition of property and equipment
    (45,880 )     (35,437 )
Proceeds from disposal of property and equipment
    3,433       7,332  
Acquisition of subsidiary, net of cash received
          (23,549 )
 
           
Net cash used in investing activities
    (42,447 )     (51,654 )
 
               
FINANCING ACTIVITIES:
               
Borrowing of long-term debt
    10,886        
Repayment of long-term debt
    (8,002 )      
Repurchase of common stock
    (12,721 )      
Proceeds from stock option exercises
    547       1,118  
 
           
Net cash from (used in) financing activities
    (9,290 )     1,118  
 
           
 
               
NET DECREASE IN CASH & CASH EQUIVALENTS
    (3,556 )     (7,083 )
CASH & CASH EQUIVALENTS, BEGINNING OF PERIOD
    7,499       30,870  
 
           
CASH & CASH EQUIVALENTS, END OF PERIOD
  $ 3,943     $ 23,787  
 
           


 

Saia Motor Freight Line, Inc.
Financial Information
For the Quarter and Nine Months Ended September 30, 2005 and 2004
(Amounts in thousands)
                                                 
    Third Quarter     %     Nine Months     %  
    2005     2004     Change     2005     2004     Change  
Operating revenue (excluding fuel surcharge)
    177,984       162,341       9.6       501,398       455,062       10.2  
Operating revenue
    198,810       172,307       15.4       551,599       479,727       15.0  
Operating income
    13,406       10,526               34,876       25,734          
Integration charges*
                              2,054          
Operating income excluding integration charges*
    13,406       10,526               34,876       27,788          
Operating ratio
    93.3       93.9               93.7       94.6          
Operating ratio excluding integration charges*
    93.3       93.9               93.7       94.2          
                                                     
                                Third Quarter        
        Third Quarter     %     Amount/Workday     %  
        2005     2004     Change     2005     2004     Change  
Workdays
                                64       64          
 
                                                   
F/S Revenue
  LTL     183,929       159,672       15.2       2,873.9       2,494.9       15.2  
 
  TL     14,881       12,635       17.8       232.5       197.4       17.8  
 
  Total     198,810       172,307       15.4       3,106.4       2,692.3       15.4  
 
                                                   
Revenue excluding
  LTL     184,207       159,723       15.3       2,878.2       2,495.7       15.3  
revenue recognition
  TL     14,904       12,639       17.9       232.9       197.5       17.9  
adjustment
  Total     199,111       172,362       15.5       3,111.1       2,693.2       15.5  
 
                                                   
Tonnage
  LTL     821       764       7.4       12.82       11.93       7.4  
 
  TL     170       160       6.2       2.66       2.51       6.2  
 
  Total     991       924       7.2       15.48       14.44       7.2  
 
                                                   
Shipments
  LTL     1,477       1,398       5.6       23.07       21.84       5.6  
 
  TL     23       22       8.0       0.36       0.34       8.0  
 
  Total     1,500       1,420       5.7       23.43       22.18       5.7  
 
                                                   
Revenue/cwt.
  LTL     11.22       10.46       7.4                          
 
  TL     4.37       3.94       11.0                          
 
  Total     10.05       9.33       7.7                          
 
                                                   
Revenue/cwt.
  LTL     9.97       9.81       1.6                          
(excluding fuel surcharge)
  TL     4.29       3.90       10.0                          
 
  Total     9.00       8.79       2.4                          
 
                                                   
Revenue/shipment
  LTL     124.74       114.26       9.2                          
 
  TL     641.58       587.61       9.2                          
 
  Total     132.75       121.44       9.3                          
 
                                                   
Pounds/shipment
  LTL     1,111       1,093       1.7                          
 
  TL     14,666       14,910       (1.6 )                        
 
  Total     1,321       1,302       1.5                          
* — Integration charges consist of employee retention and stay bonuses, communications, re-logoing the fleet of Clark Bros., technology integration and other items in connection with the integration of the operations of Clark Bros. Management believes that excluding these charges more accurately reflects the core operating performance of Saia.


 

Jevic Transportation, Inc.
Financial Information
For the Quarter and Nine Months Ended September 30, 2005 and 2004
(Amounts in thousands)
                                                 
    Third Quarter     %     Nine Months     %  
    2005     2004     Change     2005     2004     Change  
Operating revenue (excluding fuel surcharge)
    76,128       79,406       (4.1 )     233,666       237,317       (1.5 )
Operating revenue
    85,727       84,517       1.4       258,112       250,605       3.0  
Operating income
    1,414       2,832               2,461       8,300          
Operating ratio
    98.4       96.6               99.0       96.7          
                                                     
                                Third Quarter        
        Third Quarter     %     Amount/Workday     %  
        2005     2004     Change     2005     2004     Change  
Workdays
                                64       64          
 
                                                   
F/S Revenue
  LTL     54,243       54,469       (0.4 )     847.5       851.1       (0.4 )
 
  TL     27,263       26,450       3.1       426.0       413.3       3.1  
 
  Other     4,221       3,598       17.3       66.0       56.2       17.3  
 
  Total     85,727       84,517       1.4       1,339.5       1,320.6       1.4  
 
                                                   
Revenue excluding
  LTL     54,420       54,663       (0.4 )     850.3       854.1       (0.4 )
revenue recognition
  TL     27,360       26,548       3.1       427.5       414.8       3.1  
adjustment
  Other     4,221       3,598       17.3       66.0       56.2       17.3  
 
  Total     86,001       84,809       1.4       1,343.8       1,325.1       1.4  
 
                                                   
Tonnage
  LTL     250       266       (6.1 )     3.90       4.16       (6.1 )
 
  TL     294       301       (2.2 )     4.59       4.70       (2.2 )
 
  Total     544       567       (4.0 )     8.49       8.86       (4.0 )
 
                                                   
Shipments
  LTL     209       221       (5.4 )     3.26       3.45       (5.4 )
 
  TL     34       36       (3.9 )     0.54       0.56       (3.9 )
 
  Total     243       257       (5.2 )     3.80       4.01       (5.2 )
 
                                                   
Revenue/cwt.
  LTL     10.89       10.28       6.0                          
 
  TL     4.66       4.42       5.4                          
 
  Total     7.52       7.17       4.9                          
 
                                                   
Revenue/cwt.
  LTL     9.62       9.63       (0.2 )                        
(excl. fuel surcharge)
  TL     4.11       4.14       (0.7 )                        
 
  Total     6.64       6.72       (1.2 )                        
 
                                                   
Revenue/shipment
  LTL     260.53       247.68       5.2                          
 
  TL     798.65       744.71       7.2                          
 
  Total     336.35       316.80       6.2                          
 
                                                   
Pounds/shipment
  LTL     2,391       2,410       (0.8 )                        
 
  TL     17,154       16,864       1.7                          
 
  Total     4,477       4,412       1.5