EX-99.2 4 t08873exv99w2.htm PRESS RELEASE DATED FEBRUARY 19, 2003 exv99w2
 

     
(VITRAN-LOGO)   News Announcement

REMINDER:
Vitran management will conduct a conference call today, February 19th at 10:00 a.m. (Eastern), to discuss the Company’s 2002 fourth quarter and year-end results.
Conference call dial-in: 888/813-7831
Webcast: http://www.vcall.com/EventPage.asp?ID=83141

     
CONTACT:
Richard E. Gaetz, President/CEO
Kevin Glass, VP Finance/CFO
Vitran Corporation Inc.
416/596-7664
   
Robert L. Rinderman
Purdy R. Tran
Jaffoni & Collins Incorporated
212/835-8500 or VVN@jcir.com

FOR IMMEDIATE RELEASE

VITRAN REPORTS RECORD 2002 FOURTH QUARTER RESULTS,
DILUTED Q4 EPS OF $0.34 AND $1.11 FOR FY 2002

TORONTO, ONTARIO (February 19, 2003) — Vitran Corporation Inc. (TSX: VTN.A, AMX: VVN), a North American transportation and logistics firm, today announced record net income for the fourth quarter and a 193% improvement in net income from continuing operations for the year ended December 31, 2002 (all figures reported in Canadian dollars).

Revenues from continuing operations for the 2002 fourth quarter were $117,187,000, compared to $118,502,000 in the 2001 three-month period. For the quarter, Vitran’s net income from continuing operations rose 53.8% to $3,405,000, or $0.36 per basic share ($0.34 per diluted share), compared to net income from continuing operations of $2,214,000, or $0.22 per basic and diluted shares in the year-ago three-month period. The Company recorded a foreign exchange gain of $0.05 per basic and diluted shares in the 2002 fourth quarter, compared to a $0.10 gain per basic and diluted shares in the 2001 fourth quarter. Per share results are based on 9,582,252 and 9,859,330 shares outstanding during the 2002 and 2001 three-month periods, respectively. The reduced number of shares outstanding in the current period is primarily the result of Vitran’s stock repurchases pursuant to its Normal Course Issuer Bid on the Toronto Stock Exchange (TSX).

Revenues from continuing operations for the twelve-month period ended December 31, 2002 were $476,016,000, compared to $481,673,000 in 2001. Vitran’s income from continuing operations before depreciation (“EBITD”) increased 24.1% to $28,351,000, compared to $22,854,000 in the year-earlier period. For 2002, Vitran reported a significant increase in net income from continuing

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Vitran Q4 2002, 2/19/03   page 2 of 6

operations to $10,854,000, 193.3% above its net income from continuing operations of $3,701,000 in 2001.

The Company reported net income of $10,854,000 in 2002, compared to a net loss of $1,913,000 in 2001. The 2001 results included a $5,614,000 loss from discontinued operations related to its non-core environmental business, which was subsequently divested in January 2002. In 2002, Vitran posted net earnings of $1.12 per basic share ($1.11 per diluted share), versus a net loss of $0.19 per basic and diluted shares a year ago. Included in the 2002 net earnings was the $0.05 per basic and diluted share impact of the retirement of the founding President and Chief Executive Officer, more than offset by a $0.10 per basic and diluted share foreign exchange gain in 2002. The 2001 net earnings also included a $0.10 per basic and diluted share foreign exchange gain. Per share results are based on 9,691,041 and 9,859,296 shares outstanding during 2002 and 2001, respectively. The difference in the share count is a result of the aforementioned share buyback program.

Operating income for Vitran’s LTL segment in 2002 increased 49% to $20,419,000, compared to $13,702,000 in 2001, resulting in an operating ratio improvement to 94.6% for 2002, down from 96.4% for 2001. The improvement can be attributed to operating efficiencies achieved in both Canada and the US, highlighted by a 7.5% increase in US LTL gross profit. While both the US LTL and CDN LTL business units increased shipments year-over-year, the CDN LTL unit also achieved an improvement in revenue per hundredweight.

Revenues for the Logistics business unit in 2002 were down 23.5%, primarily the result of a 30.3% reduction in revenue at Vitran’s Freight Brokerage operation where the business was merged with Vitran Logistics and restructured to focus on more profitable long-term business. The successful merger under a common management team and the continued superior performance at the rest of the Logistics segment improved the operating ratio to 96.6% in 2002 from 99.8% in 2001, and income from operations increased significantly to $1.5 million from $0.1 million.

Revenue for the Truckload (TL) segment increased 7.9% in 2002 to $53.3 million, from $49.4 million in 2001. The revenue gains were offset by significant increases in liability and healthcare insurance resulting in an operating income decline of 8.6% to $1,386,000 for the year, compared with $1,517,000 in 2001.

As a result of the new accounting standard applicable to goodwill, the 2002 fourth quarter and annual results do not include amortization expense that otherwise accounted for $0.05 and $0.21 per

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Vitran Q4 2002, 2/19/03   page 3 of 6

basic and diluted shares in the corresponding 2001 periods, respectively. Also required by the new accounting standard, the Company completed its initial goodwill impairment test and concluded that the fair value of Vitran’s LTL business units exceeded the carrying value. However, the Company has determined that charges of $1.3 million and $3.5 million respectively were required in the Freight Brokerage and the Truckload reporting units. The total amount of $4.8 million has been reflected as a direct charge to retained earnings effective January 1, 2002.

Commenting on Vitran’s strong fourth quarter and full-year results, President and Chief Executive Officer Richard E. Gaetz, stated, “Posting a record fourth quarter of $0.34 per diluted share, our second successive record quarter, was a direct reflection of the outstanding efforts achieved by all of Vitran’s employees and associates, especially during this challenging period for North American and world economies.

“Our core LTL operation recorded increases in total shipments and tonnage, while maintaining Vitran’s sharp focus on efficiency resulted in a 27.7% improvement in the business units’ income from operations. The Logistics operation, with its merged management group and operating systems, recorded an outstanding quarter compared to 2001. Together, these operating units contributed to a solid turnaround year for Vitran. With further efficiency gains to be made in 2003, and expected improvements at our Truckload operation, Vitran is poised for a successful 2003 campaign.”

About Vitran Corporation Inc.

Vitran Corporation Inc. is a North American group of transportation companies offering less-than-truckload, logistics, truckload, and freight brokerage services. To find out more about Vitran Corporation Inc. (TSX: VTN.A, AMX: VVN), visit the website at www.vitran.com.

Information in this news announcement relating to projected growth, improvements in productivity and future results constitutes forward-looking statements. Actual results in future periods may differ materially from the forward-looking statements because of a number of risks and uncertainties, including but not limited to economic factors, demand for the Company’s services, fuel price fluctuations, the availability of employee drivers and independent contractors, risks associated with geographic expansion, capital requirements, claims exposure and insurance costs, competition and environmental hazards. Additional information about these and other factors that could affect the Company’s business is set forth in the Company’s Annual Report on Form 20-F and other filings with the Securities and Exchange Commission.

(tables follow)


 

     
Vitran Q4 2002, 2/19/03   page 4 of 6

Vitran Corporation Inc.

Balance Sheet
December 31, 2002 and 2001 (audited)
(in thousands of Canadian dollars)

                       
          2002   2001
         
 
Assets
               
 
Current assets:
               
     
Cash
  $ 12,624     $ 12,879  
     
Accounts Receivable
    46,748       49,999  
     
Net assets of discontinued operation
          3,000  
     
Inventory, deposits & prepaids
    9,774       8,702  
     
Income taxes recoverable
          4,505  
     
Future income tax assets
    4,602       4,597  
 
   
     
 
 
    73,748       83,682  
     
Fixed Assets
    48,570       51,021  
     
Goodwill
    69,208       74,661  
 
   
     
 
 
  $ 191,526     $ 209,364  
 
   
     
 
Liabilities and Shareholders’ Equity
               
 
Current liabilities:
               
     
Revolving credit facility
  $     $ 4,936  
     
Account payable & accrued liabilities
    43,091       40,083  
     
Income and other taxes payable
    2,747       4,527  
     
Current portion of long-term debt
    11,052       10,970  
 
   
     
 
 
    56,890       60,516  
     
Long-term debt
    48,124       63,733  
     
Future income tax liabilities
    4,366       5,737  
 
Shareholders’ equity:
               
     
Capital Stock
    37,655       38,794  
     
Retained earnings
    44,528       39,204  
     
Cumulative translation adjustment
    (37 )     1,380  
 
   
     
 
 
    82,146       79,378  
 
   
     
 
 
  $ 191,526     $ 209,364  
 
   
     
 

(statements of income follows)


 

     
Vitran Q4 2002, 2/19/03   page 5 of 6

VITRAN CORPORATION INC.
Statements Of Income

(in thousands, except share and per share amounts) (Canadian dollars)

                                   
      Three Months   Year
      Ended Dec. 31,   Ended Dec. 31,
      (unaudited)   (audited)
     
 
      2002   2001   2002   2001
     
 
 
 
Revenues
  $ 117,187     $ 118,502     $ 476,016     $ 481,673  
Operating expenses
    99,317       100,494       398,919       408,808  
 
   
     
     
     
 
Gross profit
    17,870       18,008       77,097       72,865  
 
   
     
     
     
 
Selling, general and administrative expenses
    10,051       10,974       48,746       50,011  
 
   
     
     
     
 
Income from continuing operations before depreciation
    7,819       7,034       28,351       22,854  
Depreciation
    2,038       2,287       8,327       9,852  
 
   
     
     
     
 
Income from continuing operations
    5,781       4,747       20,024       13,002  
Net interest expense
    (1,095 )     (1,263 )     (5,157 )     (5,941 )
Gain/(loss) on sale of assets
    34       (873 )     (453 )     (1,160 )
 
   
     
     
     
 
 
    (1,061 )     (2,136 )     (5,610 )     (7,101 )
Income from continuing operations before taxes, minority interest & amortization
    4,720       2,611       14,414       5,901  
Income taxes/(recovery)
    1,315       (126 )     3,560       238  
 
   
     
     
     
 
Income from continuing operations before minority interest & amortization
    3,405       2,737       10,854       5,663  
Minority interest
                      132  
 
   
     
     
     
 
Income from continuing operations before amortization
    3,405       2,737       10,854       5,795  
Amortization, net of taxes
          523             2,094  
 
   
     
     
     
 
Income from continuing operations
    3,405       2,214       10,854       3,701  
Income (loss) from discontinued operations
          (388 )           (5,614 )
 
   
     
     
     
 
Net (loss) income
  $ 3,405     $ 1,826     $ 10,854     $ (1,913 )
 
   
     
     
     
 
Earnings (loss) per share:
                               
 
Basic — before amortization expense
  $ 0.36     $ 0.28     $ 1.12     $ 0.59  
 
   
     
     
     
 
 
Basic — continuing operations
  $ 0.36     $ 0.22     $ 1.12     $ 0.38  
 
   
     
     
     
 
 
Basic — discontinued operations
  $     $ (0.04 )   $     $ (0.57 )
 
   
     
     
     
 
 
Basic — net income
  $ 0.36     $ 0.19     $ 1.12     $ (0.19 )
 
   
     
     
     
 
 
Diluted — before amortization expense
  $ 0.34     $ 0.28     $ 1.11     $ 0.59  
 
   
     
     
     
 
 
Diluted — continuing operations
  $ 0.34     $ 0.12     $ 1.11     $ 0.38  
 
   
     
     
     
 
 
Diluted — discontinued operations
  $     $ (0.04 )   $     $ (0.57 )
 
   
     
     
     
 
 
Diluted — net income
  $ 0.34     $ 0.19     $ 1.11     $ (0.19 )
 
   
     
     
     
 
Weighted average number of shares:
                               
 
Basic
    9,582,252       9,859,330       9,691,041       9,859,296  
 
   
     
     
     
 
 
Diluted
    9,913,889       9,859,330       9,784,066       9,859,296  
 
   
     
     
     
 

Vitran’s financial statements are prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP)

Vitran’s 2001 financial results at its ETL environmental business were restated to reflect the results as discontinued operations

(additional financial information follows)

 


 

     
Vitran Q4 2002, 2/19/03   page 6 of 6

LTL Statistical Information

                                         
For the quarter ended           For the year ended            
December 31, 2002           December 31, 2002            
    LTL   Q. over Q.           LTL   Yr. over Yr.
    Segment   % Change           Segment   % Change
   
 
         
 
Revenue (000’s)
  $ 94,938       2.6     Revenue (000's)   $ 379,309       1.0  
No. of Shipments
    559,027       3.7     No. of Shipments     2,238,119       1.5  
Weight (000’s lbs)
    877,400       4.7     Weight (000's lbs)     3,536,005       1.5  
Revenue per shipment
  $ 169.83       (1.0 )   Revenue per shipment   $ 169.48       (0.5 )
Weight per shipment
    1,570       1.0     Weight per shipment     1,580       0.1  
Revenue per CWT
  $ 10.46       (3.1 )   Revenue per CWT   $ 10.48       0.2  

Supplementary Divisional Financial Information
(000’s of $CDN)

                                                         
For the quarter
ended December 31,
2002           2001
   
         
            Inc. from                           Inc. from        
    Revenue   Cont. Ops.   OR%           Revenue   Cont. Ops.   OR%
   
 
 
         
 
 
LTL
    94,938       5,226       94.5     LTL     92,531       4,093       95.6  
LOG
    9,365       608       93.5     LOG     13,184       (117 )     100.9  
TL
    12,884       (93 )     100.7     TL     12,787       4       100.0  
                                                         
For the year ended
December 31,
2002           2001
   
         
            Inc. from                           Inc. from        
    Revenue   Cont. Ops.   OR%           Revenue   Cont. Ops.   OR%
   
 
 
         
 
 
LTL
    379,309       20,418       94.6     LTL     375,551       13,702       96.4  
LOG
    43,376       1,496       96.6     LOG     56,688       102       99.8  
TL
    53,331       1,386       97.4     TL     49,434       1,517       96.9  

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