EX-99.1.1 2 exhibit1.htm EX-99.1.1 EX-99.1.1
     
CONTACT:    
Richard Gaetz, President/CEO
Sean Washchuk, VP Finance/CFO
Vitran Corporation Inc.
416/596-7664
  Robert Rinderman
Karin Oloffson
Jaffoni & Collins Incorporated
212/835-8500 or VTNC@jcir.com
 
   

VITRAN REPORTS RECORD $0.38 DILUTED EPS IN 2005 Q2
ON 12 PERCENT REVENUE RISE

- Extends Earnings Increase Streak to 15 Consecutive Quarters -

TORONTO, ONTARIO (July 21, 2005) – Vitran Corporation Inc. (NASDAQ: VTNC, TSX: VTN), a North American transportation and logistics firm, today announced record quarterly financial results for the 2005 second quarter ended June 30, 2005 (all figures reported in $U.S.).

Vitran achieved net income of $4.8 million, or 0.38 per diluted share, on revenue of $105.1 million in the second quarter of 2005. In the comparable 2004 quarter, Vitran recorded net income of $4.4 million, or $0.34 per diluted share, on revenue of $93.9 million.

“The second quarter was another record for Vitran, with the Company achieving diluted earnings of $0.38 per share, yet perhaps the most important development during the quarter was the closing of our Chris Truck Line (CTL) acquisition on May 31, 2005. CTL further expands our U.S. freight coverage in the Midwestern and Southwestern U.S. by four new states and an additional 19 terminals. As previously stated, we expect CTL’s contribution to be accretive to Vitran’s 2005 full-year earnings results. Subsequent to the acquisition, we continue to maintain a strong financial position, with $12.7 million in cash and $29.8 million in available credit,” stated Vitran President and Chief Executive Officer Rick Gaetz.

During the six-month period ended June 30, 2005, Vitran recorded net income of $7.6 million, or $0.59 per diluted share, on revenue of $199.0 million. In the prior year period, the Company achieved net income of $6.0 million, or $0.47 per diluted share, on revenue of $181.1 million.

Segmented Results
Income from operations at Vitran’s LTL (less-than-truckload) segment rose 20 percent during the 2005 second quarter to $6.6 million, highlighted by a 12 percent revenue increase at the U.S. business unit and a seven percent rise in revenue from the Canadian business unit. The LTL segment’s consolidated OR (operating ratio) improved to 92.3, versus 92.7 in the year ago quarter. The U.S. LTL unit achieved an eight percent quarter over prior year quarter improvement in revenue per hundredweight and a five percent increase in revenue per shipment. The Canadian LTL operation also recorded solid Q2 results with a 12 percent increase in revenue per shipment and revenue per hundredweight jumping 10 percent.

Vitran’s Truckload segment achieved a 47 percent income from operations increase during the quarter, and lowered its OR to 92.0. The Logistics segment achieved 41 percent higher operating income, improving its OR to 93.6.

Following the close of the quarter, in early July, Vitran Logistics commenced operations of a 125,000 square foot dedicated distribution facility in Calgary on behalf a leading Canadian retail apparel and footwear company.

Guidance Update
Following the closure of the Chris Truck Line acquisition on May 31, 2005, management raised its 2005 diluted earnings per share guidance for the year to $1.35 to $1.47.

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. (NASDAQ:VTNC, TSX:VTN), visit the website at www.vitran.com.

Statements in the press release regarding management’s future expectation, beliefs, goals, plans, or prospects constitute forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. For this purpose, any statements that are contained herein that are not statements or historical fact may be deemed to be forward-looking statements made pursuant to the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, the words “believes”, “anticipates”, “plans” “intends”, “will”, “should”, ”expects”, “projects”, and similar expressions are intended to identify forward-looking statements. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause actual result, future circumstances or events to differ materially from those projected in the forward-looking statements. These risks include, but are 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, government regulation changes, environmental hazards and other risks detailed from time-to-time in the Company’s public disclosure documents or other
filing with the Canadian and United States securities commissions or other securities regulatory
bodies. The forward-looking statements are made as of the date hereof, and the Company disclaims any intention and has no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

(tables follow)

1

VITRAN CORPORATION INC.
CONSOLIDATED BALANCE SHEETS

(in thousands of United States dollars)

                 
    June 30, 2005   Dec. 31, 2004
Assets                
Current assets:
  $ 9,536     $ 7,375  
Marketable securities
    3,193       33,087  
Accounts receivable
    46,999       40,124  
Inventory, deposits and prepaid expenses
    7,888       5,924  
Future income tax assets
    3,269       3,667  
 
               
 
    70,885       90,177  
Capital assets
    53,500       37,563  
Goodwill
    61,901       45,304  
 
               
 
  $ 186,286     $ 173,044  
 
               
Liabilities and Shareholders’ Equity
               
 
               
Current liabilities:
               
Accounts payable & accrued liabilities
  $ 39,377     $ 33,377  
Income and other taxes payable
    2,315       2,399  
Current portion of long-term debt
    4,531       3,030  
 
               
 
    46,223       38,806  
Long-term debt
    8,866       11,507  
Future income tax liabilities
    3,814       3,546  
 
               
Shareholders’ equity:
               
Common shares
    63,367       60,798  
Contributed surplus
    616       323  
Retained earnings
    61,964       54,972  
Cumulative translation adjustment
    1,436       3,092  
 
               
 
    127,383       119,185  
 
               
 
  $ 186,286     $ 173,044  
 
               

(Statements of Income follows)

2

VITRAN CORPORATION INC.
CONSOLIDATED STATEMENTS OF INCOME

(unaudited) (in thousands of $U.S., except share and per share amounts)

                                 
    Three Months   Three Months   Six Months   Six Months
    Ended   Ended   Ended   Ended
    June 30, 2005   June 30, 2004   June 30, 2005   June 30, 2004
Revenues
  $ 105,050     $ 93,931     $ 198,991     $ 181,077  
Operating expenses
    86,742       78,665       166,886       154,239  
Selling, general and administrative
                               
expenses
    9,795       8,201       18,612       16,364  
Other expense (income)
    (17 )     (37 )     (27 )     (113 )
 
                               
 
    96,520       86,829       185,471       170,490  
Income from operations before
                               
depreciation
    8,530       7,102       13,520       10,587  
Depreciation expense
    1,517       1,232       2,848       2,540  
 
                               
Income from operations before undernoted
    7,013       5,870       10,672       8,047  
Interest expense, net
    86       37       38       80  
Income from operations before income taxes
    6,927       5,833       10,634       7,967  
Income taxes
    2,131       1,446       3,084       1,931  
 
                               
Net income
  $ 4,796     $ 4,387     $ 7,550     $ 6,036  
 
                               
 
                               
Earnings per share:
                               
Basic
  $ 0.39     $ 0.36     $ 0.61     $ 0.50  
 
                               
Diluted
  $ 0.38     $ 0.34     $ 0.59     $ 0.47  
 
                               
Weighted average number of shares
                               
Basic
    12,447,300       12,266,703       12,429,732       12,190,998  
 
                               
Diluted
    12,778,285       12,771,784       12,767,134       12,716,553  
 
                               

(Statement of Cash Flows follows)

3

VITRAN CORPORATION INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)
(In thousands of United States dollars)

                                 
    Three months   Three months   Six months   Six months
    Ended   Ended   Ended   Ended
    Jun. 30, 2005   Jun. 30, 2004   Jun. 30, 2005   Jun. 30, 2004
 
                               
Cash provided by (used in):
                               
Operations:
                               
Net income
  $ 4,796     $ 4,387     $ 7,550     $ 6,036  
Items not involving cash from operations
                               
Depreciation expense
    1,517       1,232       2,848       2,540  
Future income taxes
    82       (465 )     647       (169 )
Stock based compensation expense
    164       58       293       58  
Gain on sale of capital assets
    (17 )     (37 )     (27 )     (113 )
 
                               
 
    6,542       5,175       11,311       8,352  
Change in non-cash working capital components
    254       3,448       (1,995 )     (6,741 )
 
                               
 
    6,796       8,623       9,316       1,611  
Investments:
                               
Purchase of capital assets
    (623 )     (1,443 )     (6,845 )     (3,078 )
Proceeds on sale of capital assets
    24       79       38       214  
Acquisition of subsidiary
    (26,499 )           (26,499 )      
Marketable securities
    27,412       (146 )     28,781       (291 )
 
                               
 
    314       (1,510 )     (4,525 )     (3,155 )
Financing:
                               
Repayment of long-term debt
    (570 )     (2,168 )     (1,140 )     (3,977 )
Issue of Common Shares upon exercise of
                               
stock options
    25       548       42       899  
Repurchase of Common Shares
    (164 )           (856 )      
 
                               
 
    (709 )     (1,620 )     (1,954 )     (3,078 )
Effect of translation adjustment on cash
    (630 )     108       (676 )     166  
 
                               
Increase (decrease) in cash position
    5,771       5,601       2,161       (4,456 )
Cash position, beginning of period
    3,765       2,360       7,375       12,417  
 
                               
Cash position, end of period
    9,536       7,961       9,536       7,961  
 
                               
 
                               
Change in non-cash working capital components:
                               
Accounts receivable
    (386 )     (1,832 )     (3,747 )     (6,836 )
Inventory, deposits and prepaid expenses
    (1,779 )     690       (1,455 )     684  
Income and other taxes recoverable/payable
    349       1,226       (412 )     (59 )
Accounts payable and accrued liabilities
    2,070       3,364       3,619       (530 )
 
                               
 
  $ 254     $ 3,448     $ (1,995 )   $ (6,741 )
 
                               

(additional financial information follows)

4

LTL Statistical Information — U.S. and CDN Divisions

For the quarter ended June 30, 2005

                                         
    U.S. LTL   Q. over Q.           CDN LTL   Q. over Q.
($U.S.)   Division   % Change   ($CDN)   Division   % Change
Revenue (000’s)
  $ 50,017       12.3     Revenue (000's)   $ 45,370       6.5  
No. of Shipments
    420,734       7.0     No. of Shipments     222,661       (5.0 )
Weight (000’s lbs)
    579,630       3.6     Weight (000's lbs)     439,136       (3.1 )
Revenue per shipment
  $ 118.88       4.9     Revenue per shipment   $ 203.76       12.1  
Revenue per CWT
  $ 8.63       8.4     Revenue per CWT   $ 10.33       9.9  

For six months ended June 30,2005

                                         
    U.S. LTL   Yr. over Yr.           CDN LTL   Yr. over Yr.
($U.S.)   Division   % Change   ($CDN)   Division   % Change
Revenue (000’s)
  $ 92,636       9.0     Revenue (000's)   $ 86,458       5.3  
No. of Shipments
    791,160       5.5     No. of Shipments     424,227       (6.4 )
Weight (000’s lbs)
    1,093,598       1.2     Weight (000's lbs)     826,605       (5.8 )
Revenue per shipment
  $ 117.09       3.3     Revenue per shipment   $ 203.80       12.6  
Revenue per CWT
  $ 8.47       7.8     Revenue per CWT   $ 10.46       11.9  

Supplementary Segmented Financial Information
(000’s of $U.S.)

                                                         
For the quarter
                          For the quarter
                       
ended June 30, 2005
                          ended June 30, 2004
                       
 
  Revenue
  Inc. from   OR%           Revenue   Inc. from   OR%
 
          Operations                           Operations        
LTL
  86,429   6,625   92.3   LTL   75,958   5,533   92.7
LOG
  9,615   615   93.6   LOG   8,768   436   95.0
TL
  9,006   716   92.0   TL   9,205   487   94.7
                                                         
For the six months ended June
                          For the six months
                       
30, 2005
                          ended June 30, 2004
                       
 
  Revenue
  Inc. from   OR%           Revenue   Inc. from   OR%
 
          Operations                           Operations        
LTL
    162,533       9,887       93.9     LTL     146,217       7,564       94.8  
LOG
    18,492       980       94.7     LOG     16,935       773       95.4  
TL
    17,966       1,458       91.9     TL     17,925       933       94.8  

# # #

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