TAMPA, Fla., Feb. 25, 2009 (GLOBE NEWSWIRE) -- Quality Distribution, Inc. (Nasdaq:QLTY) (the "Company" or "QDI") today reported the results for its fourth quarter and year ended December 31, 2008. Total revenue for the fourth quarter of 2008 was $168.1 million, a decrease of 9.9% from $186.6 million for the same quarter in 2007. Total revenue for 2008 was $815.3 million, an increase of 8.5% from $751.6 million for 2007. The addition of Boasso, acquired in December 2007, contributed $22.8 million of revenue in the fourth quarter 2008 and $87.1 million for fiscal 2008 compared to $2.5 million in the fourth quarter and fiscal year 2007.
Net income for the fourth quarter of 2008 was $13.0 million, or $0.66 per diluted share, compared to a net loss of $11.2 million, or $(0.58) per diluted share, for the same quarter in 2007. As previously reported, the fourth quarter of 2008 results include a pre-tax restructuring charge of $1.3 million, primarily related to the closure of tank wash and trucking terminals, a net pre-tax gain of $16.2 million on early debt extinguishment and related write-off of debt issuance costs, and a pretax gain of $3.4 million for the early settlement of a multiemployer pension obligation. The fourth quarter of 2007 results contained net aggregate pretax charges of $3.6 million related to adverse insurance developments, write-off of debt issuance costs and acquisition costs. Applying a normalized tax rate of 39% and excluding adjustment items, the Company would have had an adjusted loss per diluted share of $(0.01) for the fourth quarter of 2008, compared to a loss of $(0.22) for the same quarter in 2007, and $0.02 adjusted earnings per diluted share for fiscal 2008 compared to an adjusted loss per diluted share of $(0.04) for fiscal 2007.
Net income for 2008 was $12.1 million, or $0.62 per diluted share, compared to a net loss of $7.6 million, or $(0.39) per diluted share, for 2007.
Gary Enzor, President and Chief Executive Officer, commented, "Trucking volume declined roughly 20% year-over-year, yet we generated $9 million of operating cash flow in the fourth quarter and produced near break-even results in one of the most challenging quarters in our company's history. The addition of Boasso and the positive impact of our vital few cost initiatives enabled us to post positive full year adjusted pre-tax earnings despite the current economic turbulence. We enter 2009 with a stronger company than we had in 2008, and we will continue to aggressively focus on cost reduction, debt reduction and cash conservation."
Steve Attwood, Chief Financial Officer, commented further, "Another thing that was particularly significant in the fourth quarter is that we reduced our overall debt by $42 million, which included a $24.2 million reduction in our 9% Subordinated Notes and an $18 million reduction in the outstanding balance on our revolving credit facility. At year-end 2008, we had over $40 million of borrowing availability under our revolving credit facility."
The Company will host a conference call for investors to discuss these results on February 26, 2009 at 10:00 a.m. Eastern Time. The toll free dial-in number is 877-440-5788; the toll number is 719-325-4920; the passcode is 2529452. A replay of the call will be available until March 28, 2009, by dialing 888-203-1112; passcode 2529452. A webcast of the conference call can be accessed at http://investor.shareholder.com/qualitydistribution/events.cfm. Copies of this earnings release and other financial information about the Company may be accessed in the Investor Relations section of the Company's website at www.qualitydistribution.com. The Company regularly posts or otherwise makes available information in the Investor Relations section that may be important to investors.
Headquartered in Tampa, Florida, QDI, through its subsidiaries, Quality Carriers, Inc. and Boasso America Corporation, and through its affiliates and owner-operators, provides bulk transportation and related services. QDI also provides tank cleaning services to the bulk transportation industry through its QualaWash(r) facilities. QDI is an American Chemistry Council Responsible Care(r) Partner and is a core carrier for many of the Fortune 500 companies that are engaged in chemical production and processing.
The Quality Distribution, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5285
This release contains certain forward-looking information that is subject to the safe harbor provisions created by the Private Securities Litigation Reform Act of 1995 and is subject to certain risks and uncertainties that could cause actual results to differ materially from those expected or projected in the forward-looking statements. This forward-looking information includes estimated financial information for the fourth quarter and full year 2008. Without limitation, additional risks and uncertainties regarding forward-looking statements include the Company's substantial leverage and restrictions contained in our debt instruments; economic factors; turmoil in the credit and capital markets; downturns in customers' business cycles or in the national economy; the cyclical nature of the transportation industry; claims exposure and insurance costs; adverse weather conditions; dependence on affiliates and owner-operators; changes in government regulation including transportation, environmental and anti-terrorism laws; the Company's environmental remediation costs; fluctuations in fuel pricing or availability; increases in interest rates; potential disruption at U.S. ports of entry; changes in senior management; the Company's ability to achieve projected operating objectives and debt reduction in 2009; its ability to successfully integrate acquired businesses or integrate affiliate businesses converted to Company-controlled operations; the Company's ability to achieve projected reductions in payroll-related costs; increased unionization, which could increase our operating costs or constrain operating flexibility, the potential loss of our ability to use net operating losses to offset future income due to a change of control and the Company's ability to attract and retain qualified drivers. Readers are urged to carefully review and consider the various disclosures, including but not limited to risk factors contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2007 and its Quarterly Reports on Form 10-Q, as well as other reports filed with the Securities and Exchange Commission. The Company disclaims any obligations to update any forward-looking statement as a result of developments occurring after the date of this release.
QLTYE
QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In 000's) Except Per Share Data
Unaudited
Three months ended Year ended
December 31, December 31,
------------------ ------------------
2008 2007 2008 2007
-------- -------- -------- --------
OPERATING REVENUES:
Transportation $120,016 $138,020 $565,814 $580,676
Other service revenue 25,123 21,374 104,039 76,221
Fuel surcharge 22,947 27,178 145,437 94,661
--------------------------------------
Total operating revenues 168,086 186,572 815,290 751,558
--------------------------------------
OPERATING EXPENSES:
Purchased transportation 90,445 113,504 466,823 471,531
Compensation 25,592 23,262 109,110 85,820
Fuel, supplies and maintenance 21,152 24,771 114,351 81,316
Depreciation and amortization 5,567 4,584 21,002 17,544
Selling and administrative 9,321 9,977 35,836 31,291
Insurance claims 3,370 9,562 14,999 23,883
Taxes and licenses 1,200 1,251 5,242 3,980
Communications and utilities 2,607 3,300 12,716 11,381
(Gain) loss on disposal of
property and equipment (260) 541 (3,092) 959
Restructuring costs 1,250 -- 5,325 --
--------------------------------------
Total operating expenses 160,244 190,752 782,312 727,705
--------------------------------------
Operating income 7,842 (4,180) 32,978 23,853
Interest expense 9,300 7,939 35,546 31,342
Interest income (93) (245) (426) (818)
Gain on early extinguishment
of debt (16,532) -- (16,532) --
Write-off of debt issuance
costs 283 2,031 283 2,031
Other (income) expense (3,116) 1,578 (2,945) 940
--------------------------------------
Income (loss) before taxes 18,000 (15,483) 17,052 (9,642)
Provision for (benefit from)
income taxes 5,038 (4,308) 4,940 (2,079)
--------------------------------------
Net income (loss) $ 12,962 $(11,175) $ 12,112 $ (7,563)
======================================
PER SHARE DATA:
Net income (loss) per common
share
Basic $ 0.67 $ (0.58) $ 0.63 $ (0.39)
======================================
Diluted $ 0.66 $ (0.58) $ 0.62 $ (0.39)
======================================
Weighted average number of
shares
Basic 19,387 19,335 19,379 19,336
Diluted 19,523 19,335 19,539 19,336
QUALITY DISTRIBUTION, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In 000's)
Unaudited
December 31, December 31,
2008 2007
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $ 6,787 $ 9,711
Accounts receivable, net 81,612 99,081
Prepaid expenses 12,922 8,150
Deferred tax assets, net 14,707 20,483
Other 7,950 6,258
---------- ----------
Total current assets 123,978 143,683
Property and equipment, net 148,692 121,992
Goodwill 173,519 173,575
Intangibles, net 22,698 24,167
Non-current deferred tax
assets, net 22,636 16,203
Other assets 10,580 14,356
---------- ----------
Total assets $ 502,103 $ 493,976
========== ==========
LIABILITIES, MINORITY INTEREST
AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of
indebtedness $ 8,361 $ 413
Current maturities of capital
lease obligations 7,994 1,451
Accounts payable 16,126 17,428
Affiliates and independent
owner-operators payable 7,649 12,597
Accrued expenses 25,357 25,957
Environmental liabilities 4,819 4,751
Accrued loss and damage claims 8,705 13,438
Income taxes payable -- 555
---------- ----------
Total current liabilities 79,011 76,590
Long-term indebtedness, less
current maturities 330,409 343,575
Capital lease obligations, less
current maturities 15,822 3,832
Environmental liabilities 6,035 6,418
Accrued loss and damage claims 12,815 18,474
Other non-current liabilities 25,158 15,954
---------- ----------
Total liabilities 469,250 464,843
Minority interest in subsidiary 1,833 1,833
SHAREHOLDERS' EQUITY
Common stock 362,945 361,617
Treasury stock (1,580) (1,564)
Accumulated deficit (114,034) (126,146)
Stock recapitalization (189,589) (189,589)
Accumulated other comprehensive
loss (26,488) (16,748)
Stock subscriptions receivable (234) (270)
---------- ----------
Total shareholders' equity 31,020 27,300
---------- ----------
Total liabilities, minority
interest and shareholders'
equity $ 502,103 $ 493,976
========== ==========
RECONCILIATION OF NET INCOME (LOSS) TO TAX EFFECTED AND ADJUSTED NET
INCOME (LOSS) AND RECONCILIATION OF NET INCOME (LOSS) PER SHARE TO
TAX EFFECTED AND ADJUSTED NET INCOME (LOSS) PER SHARE
For the Three Months and Year Ended December 31, 2008 and 2007
(In 000's)
Unaudited
Tax Effected and Adjusted Net Income (Loss) and Tax Effected and Adjusted Net Income (Loss) Per Share (as defined) are presented herein because they are important metrics used by management to evaluate and understand the performance of the ongoing operations of the Company's business. Management uses a 39% tax rate for calculating the provision for (benefit from) income taxes to normalize the Company's tax rate to that of comparable transportation companies, and to compare Company periods with different effective tax rates. In addition, we adjust Net Income (Loss) for significant items that are not regularly recurring. Tax Effected and Adjusted Net Income (Loss) and Tax Effected and Adjusted Net Income (Loss) Per Share are not measures of financial performance or liquidity under United States Generally Accepted Accounting Principles ("GAAP"). Tax Effected and Adjusted Net Income (Loss) and Tax Effected and Adjusted Net Income (Loss) Per Share should not be considered in isolation or as a substitute for the consolidated statements of operations and cash flow data prepared in accordance with GAAP as an indication of the Company's operating performance or liquidity.
Net Income (Loss) Three months ended Year ended
Reconciliation: December 31, December 31,
------------------- ------------------
2008 2007 2008 2007
-------- --------- -------- --------
Net income (loss) $ 12,962 $ (11,175) $ 12,112 $ (7,563)
Net income (loss)
per common share:
Basic $ 0.67 $ (0.58) $ 0.63 $ (0.39)
=======================================
Diluted $ 0.66 $ (0.58) $ 0.62 $ (0.39)
=======================================
Adjustments to net
income (loss):
Provision for
(benefit from)
income taxes 5,038 (4,308) 4,940 (2,079)
Gain on early debt
extinguishment (16,532) -- (16,532) --
Write off of debt
issuance costs 283 2,031 283 2,031
Gain on pension
settlement (3,410) -- (3,410) --
Restructuring costs 1,250 -- 5,325 --
Gains on property sales -- -- (2,128) --
Adverse insurance
claims development -- 4,800 -- 4,800
Costs related to
unconsummated acquisition -- 1,556 -- 1,556
---------------------------------------
Adjusted income (loss)
before income taxes (409) (7,096) 590 (1,255)
Provision for (benefit
from) income taxes at 39% (160) (2,767) 230 (489)
---------------------------------------
Tax effected and
adjusted net income (loss) $ (249) $ (4,329) $ 360 $ (766)
=======================================
Tax effected and adjusted
net income (loss) per
common share:
Basic $ (0.01) $ (0.22) $ 0.02 $ (0.04)
=======================================
Diluted $ (0.01) $ (0.22) $ 0.02 $ (0.04)
=======================================
Weighted average number
of shares:
Basic 19,387 19,335 19,379 19,336
Diluted 19,523 19,335 19,539 19,336