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Guarantor Condensed Consolidating Financial Statements
9 Months Ended
Sep. 30, 2011
Guarantor Condensed Consolidating Financial Statements [Abstract] 
Guarantor Condensed Consolidating Financial Statements
Note 15. Guarantor Condensed Consolidating Financial Statements
The payment of principal and interest on the Company’s senior second priority secured notes are guaranteed by the Company’s wholly-owned subsidiaries (the “Guarantor Subsidiaries”) other than its driver academy subsidiary, its captive insurance subsidiaries, its special-purpose receivables securitization subsidiary, and its foreign subsidiaries (the “Non-guarantor Subsidiaries”). The separate financial statements of the Guarantor Subsidiaries are not included herein because the Guarantor Subsidiaries are the Company’s wholly-owned consolidated subsidiaries and are jointly, severally, fully and unconditionally liable for the obligations represented by the senior second priority secured notes.
The condensed consolidating financial statements present consolidating financial data for (i) Swift Transportation Company (on a parent only basis), (ii) Swift Services Holdings, Inc. (on an issuer only basis), (iii) the combined Guarantor Subsidiaries, (iv) the combined Non-Guarantor Subsidiaries, (iv) an elimination column for adjustments to arrive at the information for the parent company and subsidiaries on a consolidated basis and (v) the parent company and subsidiaries on a consolidated basis as of September 30, 2011 and December 31, 2010 and for the three and nine months ended September 30, 2011 and 2010. Swift Services Holdings, Inc. was formed in November 2010 in anticipation of the issuance of the senior second priority secured notes, and as such, there is no financial activity for this entity prior to this date.
Investments in subsidiaries are accounted for by the respective parent company using the equity method for purposes of this presentation. Results of operations of subsidiaries are therefore reflected in the parent company’s investment accounts and earnings. The principal elimination entries set forth below eliminate investments in subsidiaries and intercompany balances and transactions.
Condensed consolidating balance sheet as of September 30, 2011
                                                 
    Swift     Swift                          
    Transportation     Services                          
    Company     Holdings,     Guarantor     Non-Guarantor     Eliminations for        
    (Parent)     Inc. (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
Cash and cash equivalents
  $ 23,592     $ —     $ 8,351     $ 8,234     $ —     $ 40,177  
Restricted cash
    —       —       —       74,574       —       74,574  
Accounts receivable, net
    —       —       18,646       319,178       (3,320 )     334,504  
Intercompany receivable (payable)
    427,101       467,953       (951,275 )     56,221       —       —  
Other current assets
    3,804       48       110,555       9,926       —       124,333  
 
                                   
Total current assets
    454,497       468,001       (813,723 )     468,133       (3,320 )     573,588  
 
                                   
 
                                               
Property and equipment, net
    —       —       1,260,737       31,250       —       1,291,987  
Other assets
    (529,685 )     2,790       295,846       6,485       295,009       70,445  
Intangible assets, net
    —       —       343,483       11,408       —       354,891  
Goodwill
    —       —       246,977       6,279       —       253,256  
 
                                   
Total assets
  $ (75,188 )   $ 470,791     $ 1,333,320     $ 523,555     $ 291,689     $ 2,544,167  
 
                                   
 
                                               
Current portion of long-term debt and obligations under capital leases
  $ —     $ —     $ 53,604     $ 47,947     $ (47,548 )   $ 54,003  
Other current liabilities
    1,668       18,889       227,812       31,811       (3,320 )     276,860  
 
                                   
Total current liabilities
    1,668       18,889       281,416       79,758       (50,868 )     330,863  
 
                                   
 
                                               
Long-term debt and obligations under capital leases
    —       490,982       1,042,230       5,639       (5,140 )     1,533,711  
Deferred income taxes
    (104,569 )     (13,685 )     446,244       3,616       —       331,606  
Securitization of accounts receivable
    —       —       —       180,000       —       180,000  
Other liabilities
    —       —       74,437       47,561       —       121,998  
 
                                   
Total liabilities
    (102,901 )     496,186       1,844,327       316,574       (56,008 )     2,498,178  
 
                                   
 
                                               
Total stockholders’ equity (deficit)
    27,713       (25,395 )     (511,007 )     206,981       347,697       45,989  
 
                                   
 
                                               
Total liabilities and stockholders’ equity (deficit)
  $ (75,188 )   $ 470,791     $ 1,333,320     $ 523,555     $ 291,689     $ 2,544,167  
 
                                   
Condensed consolidating balance sheet as of December 31, 2010
                                                 
    Swift     Swift                            
    Transportation     Services             Non-     Eliminations        
    Company     Holdings,     Guarantor     Guarantor     for        
    (Parent)     Inc. (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
Cash and cash equivalents
  $ 1,561     $ —     $ 35,844     $ 10,089     $ —     $ 47,494  
Restricted cash
    —       —       —       84,568       —       84,568  
Accounts receivable, net
    —       —       16,398       261,175       (694 )     276,879  
Intercompany receivable (payable)
    324,359       487,942       (861,300 )     48,999       —       —  
Other current assets
    9,104       44       82,247       11,980       —       103,375  
 
                                   
Total current assets
    335,024       487,986       (726,811 )     416,811       (694 )     512,316  
 
                                   
 
                                               
Net property and equipment
    —       —       1,309,453       30,185       —       1,339,638  
Other assets
    (588,713 )     2,051       301,472       7,966       371,165       93,941  
Intangible assets, net
    —       —       356,696       12,048       —       368,744  
Goodwill
    —       —       246,977       6,279       —       253,256  
 
                                   
Total assets
  $ (253,689 )   $ 490,037     $ 1,487,787     $ 473,289     $ 370,471     $ 2,567,895  
 
                                   
 
                                               
Current portion of long-term debt and obligations under capital leases
  $ —     $ —     $ 65,672     $ 3,757     $ (3,359 )   $ 66,070  
Other current liabilities
    3,848       1,389       226,623       28,948       (694 )     260,114  
 
                                   
Total current liabilities
    3,848       1,389       292,295       32,705       (4,053 )     326,184  
 
                                   
 
                                               
Long-term debt and obligations under capital leases
    —       490,035       1,217,197       2,537       (1,739 )     1,708,030  
Deferred income taxes
    (162,856 )     (486 )     463,183       3,708       —       303,549  
Securitization of accounts receivable
    —       —       —       171,500       —       171,500  
Other liabilities
    —       —       91,565       50,238       —       141,803  
 
                                   
Total liabilities
    (159,008 )     490,938       2,064,240       260,688       (5,792 )     2,651,066  
 
                                   
 
                                               
Total stockholders’ equity (deficit)
    (94,681 )     (901 )     (576,453 )     212,601       376,263       (83,171 )
 
                                   
 
                                               
Total liabilities and stockholders’ equity (deficit)
  $ (253,689 )   $ 490,037     $ 1,487,787     $ 473,289     $ 370,471     $ 2,567,895  
 
                                   
Condensed consolidating statement of operations for the three months ended September 30, 2011
                                                 
    Swift                                  
    Transportation     Swift Services             Non-     Eliminations        
    Company     Holdings, Inc.     Guarantor     Guarantor     for        
    (Parent)     (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
 
Operating revenue
  $ —     $ —     $ 849,677     $ 15,916     $ (1,767 )   $ 863,826  
 
                                   
 
                                               
Operating expenses:
                                               
Salaries, wages and employee benefits
    781       —       189,784       6,481       —       197,046  
Operating supplies and expenses
    480       2       61,010       2,505       (2,203 )     61,794  
Fuel
    —       —       155,054       4,665       —       159,719  
Purchased transportation
    —       —       244,416       2,366       (12,039 )     234,743  
Rental expense
    —       —       23,559       311       (185 )     23,685  
Insurance and claims
    —       —       19,195       (10,603 )     12,660       21,252  
Depreciation and amortization of property and equipment
    —       —       50,289       769       —       51,058  
Amortization of intangibles
    —       —       4,301       208       —       4,509  
Impairments
    —       —       —       —       —       —  
(Gain) loss on disposal of property and equipment
    —       —       (2,942 )     (4 )     —       (2,946 )
Communication and utilities
    —       —       6,563       256       —       6,819  
Operating taxes and licenses
    —       —       14,465       1,985       —       16,450  
 
                                   
Total operating expenses
    1,261       2       765,694       8,939       (1,767 )     774,129  
 
                                   
Operating income (loss)
    (1,261 )     (2 )     83,983       6,977       —       89,697  
 
                                   
Interest expense, net
    —       12,912       25,251       1,288       —       39,451  
Other (income) expenses
    (33,404 )     —       4,383       (2,228 )     30,869       (380 )
 
                                   
Income (loss) before income taxes
    32,143       (12,914 )     54,349       7,917       (30,869 )     50,626  
Income tax expense (benefit)
    1,193       (4,738 )     20,945       2,276       —       19,676  
 
                                   
Net income (loss)
  $ 30,950     $ (8,176 )   $ 33,404     $ 5,641     $ (30,869 )   $ 30,950  
 
                                   
Condensed consolidating statement of operations for the three months ended September 30, 2010
                                                 
    Swift                                  
    Transportation     Swift Services             Non-     Eliminations        
    Company     Holdings, Inc.     Guarantor     Guarantor     for        
    (Parent)     (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
 
Operating revenue
  $ —     $ —     $ 747,296     $ 37,036     $ (26,051 )   $ 758,281  
 
                                   
 
                                               
Operating expenses:
                                               
Salaries, wages and employee benefits
    —       —       180,909       6,390       —       187,299  
Operating supplies and expenses
    2,664       —       47,426       9,792       (783 )     59,099  
Fuel
    —       —       113,035       3,864       —       116,899  
Purchased transportation
    —       —       208,271       2,926       (12,287 )     198,910  
Rental expense
    —       —       19,052       322       (187 )     19,187  
Insurance and claims
    —       —       18,190       17,502       (12,794 )     22,898  
Depreciation and amortization
    —       —                                  
of property and equipment
    —       —       47,382       645       —       48,027  
Amortization of intangibles
    —       —       4,725       230       —       4,955  
Impairments
    —       —       —       —       —       —  
(Gain) loss on disposal of property and equipment
    —       —       (1,836 )     28       —       (1,808 )
Communication and utilities
    —       —       6,173       235       —       6,408  
Operating taxes and licenses
    —       —       12,575       1,732       —       14,307  
 
                                   
Total operating expenses
    2,664       —       655,902       43,666       (26,051 )     676,181  
 
                                   
Operating income (loss)
    (2,664 )     —       91,394       (6,630 )     —       82,100  
 
                                   
Interest expense, net
    —       —       78,992       1,769       —       80,761  
Other (income) expenses
    (662 )     —       9,166       (9,450 )     334       (612 )
 
                                   
Income (loss) before income taxes
    (2,002 )     —       3,236       1,051       (334 )     1,951  
Income tax expense (benefit)
    (983 )     —       2,574       1,379       —       2,970  
 
                                   
Net income (loss)
  $ (1,019 )   $ —     $ 662     $ (328 )   $ (334 )   $ (1,019 )
 
                                   
Condensed consolidating statement of operations for the nine months ended September 30, 2011
                                                 
    Swift                                  
    Transportation     Swift Services             Non-     Eliminations        
    Company     Holdings, Inc.     Guarantor     Guarantor     for        
    (Parent)     (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
 
Operating revenue
  $ —     $ —     $ 2,429,342     $ 99,467     $ (55,624 )   $ 2,473,185  
 
                                   
 
                                               
Operating expenses:
                                               
Salaries, wages and employee benefits
    5,524       —       569,780       19,774       —       595,078  
Operating supplies and expenses
    2,653       2       160,849       18,983       (4,823 )     177,664  
Fuel
    —       —       463,668       14,869       —       478,537  
Purchased transportation
    —       —       680,612       7,241       (35,393 )     652,460  
Rental expense
    —       —       60,509       947       (558 )     60,898  
Insurance and claims
    —       —       57,633       29,070       (14,850 )     71,853  
Depreciation and amortization of property and equipment
    —       —       150,787       2,182       —       152,969  
Amortization of intangibles
    —       —       13,213       640       —       13,853  
Impairments
    —       —       —       —       —       —  
(Gain) loss on disposal of property and equipment
    —       —       (5,956 )     55       —       (5,901 )
Communication and utilities
    —       —       18,870       744       —       19,614  
Operating taxes and licenses
    —       —       40,631       6,536       —       47,167  
 
                                   
Total operating expenses
    8,177       2       2,210,596       101,041       (55,624 )     2,264,192  
 
                                   
Operating income (loss)
    (8,177 )     (2 )     218,746       (1,574 )     —       208,993  
 
                                   
Interest expense, net
    —       38,687       78,083       4,558       —       121,328  
Other (income) expenses
    (58,782 )     (22,277 )     11,846       (21,061 )     88,719       (1,555 )
 
                                   
Income (loss) before income taxes
    50,605       (16,412 )     128,817       14,929       (88,719 )     89,220  
Income tax expense (benefit)
    (3,133 )     (14,195 )     47,759       5,051       —       35,482  
 
                                   
Net income (loss)
  $ 53,738     $ (2,217 )   $ 81,058     $ 9,878     $ (88,719 )   $ 53,738  
 
                                   
Condensed consolidating statement of operations for the nine months ended September 30, 2010
                                                 
    Swift                                  
    Transportation     Swift Services             Non-     Eliminations        
    Company     Holdings, Inc.     Guarantor     Guarantor     for        
    (Parent)     (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
 
Operating revenue
  $ —     $ —     $ 2,112,918     $ 115,115     $ (78,737 )   $ 2,149,296  
 
                                   
 
                                               
Operating expenses:
                                               
Salaries, wages and employee benefits
    —       —       533,523       18,497       —       552,020  
Operating supplies and expenses
    5,121       —       131,653       26,737       (2,361 )     161,150  
Fuel
    —       —       326,028       12,447       —       338,475  
Purchased transportation
    —       —       599,848       6,236       (33,683 )     572,401  
Rental expense
    —       —       57,184       976       (577 )     57,583  
Insurance and claims
    —       —       60,835       53,865       (42,116 )     72,584  
Depreciation and amortization of property and equipment
    —       —       154,411       2,038       —       156,449  
Amortization of intangibles
    —       —       14,924       708       —       15,632  
Impairments
    —       —       1,274       —       —       1,274  
(Gain) loss on disposal of property and equipment
    —       —       (5,041 )     28       —       (5,013 )
Communication and utilities
    —       —       18,304       658       —       18,962  
Operating taxes and licenses
    —       —       35,542       5,755       —       41,297  
 
                                   
Total operating expenses
    5,121       —       1,928,485       127,945       (78,737 )     1,982,814  
 
                                   
Operating income (loss)
    (5,121 )     —       184,433       (12,830 )     —       166,482  
 
                                   
Interest expense, net
    —       —       242,504       5,124       —       247,628  
Other (income) expenses
    73,806       —       19,865       (28,146 )     (67,977 )     (2,452 )
 
                                   
Income (loss) before income taxes
    (78,927 )     —       (77,936 )     10,192       67,977       (78,694 )
Income tax expense (benefit)
    (1,828 )     —       (4,130 )     4,363       —       (1,595 )
 
                                   
Net income (loss)
  $ (77,099 )   $ —     $ (73,806 )   $ 5,829     $ 67,977     $ (77,099 )
 
                                   
Condensed consolidating statement of cash flows for the nine months ended September 30, 2011
                                                 
    Swift                                  
    Transportation     Swift Services             Non-     Eliminations        
    Company     Holdings, Inc.     Guarantor     Guarantor     for        
    (Parent)     (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
Net cash provided by (used in) operating activities
  $ —     $ —     $ 265,079     $ (47,858 )   $ —     $ 217,221  
 
                                               
Cash flows from investing activities:
                                               
Decrease in restricted cash
    —       —       —       9,994       —       9,994  
Proceeds from sale of property and equipment
    —       —       46,737       132       —       46,869  
Capital expenditures
    —       —       (164,616 )     (3,430 )     —       (168,046 )
Payments received on notes receivable
    —       —       5,118       —       —       5,118  
Expenditures on assets held for sale
    —       —       (6,093 )     —       —       (6,093 )
Payments received on assets held for sale
    —       —       9,089       —       —       9,089  
Funding of intercompany notes
    —       —       (4,306 )     —       4,306       —  
Payments received on intercompany notes
    —       —       2,541       —       (2,541 )     —  
Dividend from subsidiary
    —       —       15,600       —       (15,600 )     —  
 
                                   
Net cash (used in) provided by investing activities
    —       —       (95,930 )     6,696       (13,835 )     (103,069 )
 
                                   
 
                                               
Cash flows from financing activities:
                                               
Proceeds from issuance of class A common stock, net of issuance costs
    62,994       —       —       —       —       62,994  
Payment of deferred loan costs
    —       (979 )     (1,848 )     (884 )     —       (3,711 )
Borrowings under accounts receivable securitization
    —       —       —       164,000       —       164,000  
Repayment of accounts receivable securitization
    —       —       —       (155,500 )     —       (155,500 )
Repayment of long-term debt and capital leases
    —       —       (189,091 )     (299 )     —       (189,390 )
Proceeds from intercompany notes
    —       —       —       4,306       (4,306 )     —  
Repayment of intercompany notes
    —       —       —       (2,541 )     2,541       —  
Dividend to parent
    —       —       —       (15,600 )     15,600       —  
Other financing activities
    138       —       —       —       —       138  
Net funding (to) from affiliates
    (41,101 )     979       (5,703 )     45,825       —       —  
 
                                   
Net cash provided by (used in) financing activities
    22,031       —       (196,642 )     39,307       13,835       (121,469 )
 
                                   
Net increase (decrease) in cash and cash equivalents
    22,031       —       (27,493 )     (1,855 )     —       (7,317 )
 
                                   
Cash and cash equivalents at beginning of period
    1,561       —       35,844       10,089       —       47,494  
Cash and cash equivalents at end of period
  $ 23,592     $ —     $ 8,351     $ 8,234     $ —     $ 40,177  
 
                                   
Condensed consolidating statement of cash flows for the nine months ended September 30, 2010
                                                 
    Swift                                  
    Transportation     Swift Services             Non-     Eliminations        
    Company     Holdings, Inc.     Guarantor     Guarantor     for        
    (Parent)     (Issuer)     Subsidiaries     Subsidiaries     Consolidation     Consolidated  
    (In thousands)  
Net cash provided by (used in) operating activities
  $ —     $ —     $ 119,259     $ (5,174 )   $ —     $ 114,085  
 
                                   
 
                                               
Cash flows from investing activities:
                                               
Increase in restricted cash
    —       —       —       (47,616 )     —       (47,616 )
Proceeds from sale of property and equipment
    —       —       30,370       166       —       30,536  
Capital expenditures
    —       —       (106,116 )     (2,059 )     —       (108,175 )
Payments received on notes receivable
    —       —       4,179       —       —       4,179  
Expenditures on assets held for sale
    —       —       (1,929 )     —       —       (1,929 )
Payments received on assets held for sale
    —       —       2,365       —       —       2,365  
Payments received on intercompany notes
    —       —       11,750       —       (11,750 )     —  
Dividend from subsidiary
    —       —       8,000       —       (8,000 )     —  
Capital contribution to subsidiary
    —       —       (11,350 )     —       11,350       —  
Other investing activities
    —       —       196       —       12       208  
 
                                   
Net cash used in investing activities
    —       —       (62,535 )     (49,509 )     (8,388 )     (120,432 )
 
                                   
 
                                               
Cash flows from financing activities:
                                               
Borrowings under accounts receivable securitization
    —       —       —       117,000       —       117,000  
Repayment of accounts receivable securitization
    —       —       —       (125,000 )     —       (125,000 )
Repayment of long-term debt and capital leases
    —       —       (42,599 )     —       —       (42,599 )
Repayment of intercompany notes
    —       —       —       (11,750 )     11,750       —  
Dividend to parent
    —       —       —       (8,000 )     8,000       —  
Capital contribution
    —       —       —       11,350       (11,350 )     —  
Other financing activities
    —       —       (980 )     12       (12 )     (980 )
Net funding (to) from affiliates
    (20,063 )     —       (38,095 )     58,158       —       —  
 
                                   
Net cash (used in) provided by financing activities
    (20,063 )     —       (81,674 )     41,770       8,388       (51,579 )
 
                                   
Net decrease in cash and cash equivalents
    (20,063 )     —       (24,950 )     (12,913 )     —       (57,926 )
 
                                   
Cash and cash equivalents at beginning of period
    21,114       —       70,438       24,310       —       115,862  
Cash and cash equivalents at end of period
  $ 1,051     $ —     $ 45,488     $ 11,397     $ —     $ 57,936