JACKSONVILLE, Fla., March 25, 2009 (GLOBE NEWSWIRE) -- Trailer Bridge, Inc. (Nasdaq:TRBR) today reported final financial results for the fourth quarter ended December 31, 2008 (see attached tables), highlighted by a 5.7% increase in revenue from the fourth quarter of 2007 to $33.3 million, an operating ratio of 95.7% and a net loss of $1.1 million, or $0.09 per share, including a one time compensation charge of $830,000 related to the departure of the Company's Chief Executive Officer. Exclusive of the compensation charge, the Company reported a net loss of $292,000, or $0.02 per share. For the year ended December 31, 2008, revenue increased 14.5% to $133.0 million. The Company had an operating ratio of 94.8% and a net loss of $3.2 million, or $0.27 per share.
The Company's fourth quarter results were impacted by reduced southbound volume in the latter part of the quarter as well as unusual operating expenses. During November and December, the Company's revenue was negatively impacted by softened volume coupled with weather related schedule disruptions. These disruptions resulted in one less voyage than anticipated, and increased inland transportation, equipment and marine terminal expenses. Improvement in Dominican Republic volume mitigated the reduced volume to Puerto Rico.
2008 Fourth Quarter Financial Review
Total revenue for the fourth quarter was $33.3 million, an increase of 5.7% compared to the $31.5 million reported in the same quarter of 2007 and a decrease of 5.9% compared sequentially to the third quarter. Revenue in the Dominican Republic market was $2.4 million, compared to $0.4 million in the year earlier period and $2.2 million in the third quarter of 2008. Exclusive of fuel surcharges, total revenue was $27.2 million, an increase of 2.5% compared to the $26.5 million in the prior year period, but a decrease of 1.1% compared sequentially to the $27.5 million in the third quarter. Trailer Bridge reported operating income of $1.4 million, compared with operating income of $2.4 million in the fourth quarter of 2007, and $2.6 million in the third quarter of 2008.
Earnings before interest, taxes, depreciation, and amortization (EBITDA, see attached tables) totaled $3.0 million for the fourth quarter of 2008, compared to $3.9 million for the previous year. Adjusted EBITDA, which excludes stock compensation expenses, losses and gains on asset sales, legal expenses related to the Anti-trust investigation, and a one-time compensation charge related to the departure of the Company's Chief Executive Officer, for the fourth quarter of 2008 totaled $4.4 million, compared to $4.1 million for the previous year.
Trailer Bridge's southbound volume for the fourth quarter of 2008 declined 0.9% over the same quarter last year and 8.4% below the third quarter of 2008. The Company's fourth quarter typically has the highest revenue in the year and generally is above third quarter levels. Northbound volume increased 4.3% from the prior year period but declined 12.1% from the third quarter of 2008. The reduced northbound volume was primarily related to the temporary suspension of shipments of recycled materials, whose movement is dependent upon funding from the government of Puerto Rico. These shipments began moving again in the first quarter of 2009.
Car and other vehicle volume declined by 10.9% from the prior year quarter, but improved 19.6% from the third quarter of 2008. Increased used vehicle volume to the Dominican Republic helped offset declines in both new and used vehicle volume to Puerto Rico.
The Company's vessel capacity utilization during the fourth quarter of 2008 was 92.9% southbound and 23.7% northbound, compared to 75.9% and 20.4%, respectively, in the comparable quarter in 2007, when a fifth vessel was in liner service. The comparable vessel capacity utilization during the third quarter of 2008 was 97.0% southbound and 28.4% northbound.
In Trailer Bridge's third quarter financial results, the Company referred to an expected fourth quarter benefit relative to the third quarter of $3.5 million from four highlighted items. The actual benefit from those items totaled $2.5 million, with the difference related to less reduction in net fuel costs as a result of reduced fuel surcharge revenue in the latter part of the quarter. Legal fees related to the anti-trust investigation and related class action lawsuit were $341,000, compared to $921,000 in the third quarter of 2008.
Ralph W. Heim, Trailer Bridge's President stated, "We finished 2008 with our sailing schedule and operating costs once again back in line with our expectations. This is fundamental for us as it can impact everything from customer satisfaction to a number of important operating efficiencies. We also believe that the tightened economic conditions currently in the market only make our value proposition more attractive to shippers and will continue efforts to deliver that value to more and more customers in both Puerto Rico and Dominican Republic, while building long-term value for shareholders."
2008 Financial Review
Total revenue for the year ended December 31, 2008 was $133.0 million, an increase of 14.5% compared to the $116.2 million in 2007. The Company's operating ratio, or operating expenses expressed as a percentage of revenue, went from 87.8% in 2007 to 94.8% in 2008. Revenue to and from the Dominican Republic was $6.2 million during 2008, compared to approximately $475,000 in 2007, when service commenced. Exclusive of fuel surcharges, total revenue for 2008 was $106.9 million, an increase of $8.1 million compared to the $98.9 million in 2007.
Vessel capacity utilization southbound was 86.3% during 2008, compared to 80.0% during 2007.
Operating expenses increased by $24.1 million, or 23.7%, from $101.9 million for 2007 to $126.1 million for 2008. This increase was due primarily to fuel expenses in 2008, which increased $9.7 million, or 51.2% due to increased consumption related to the Dominican Republic service that started in August of 2007 and increases in fuel prices. The Company also incurred additional expenses during 2008 as a result of additional volume and an additional bi-weekly sailing to the Dominican Republic during the first half of the year. The Company's extra Triple Stack Box Carrier vessel ("TBC") was removed from liner service in the second half of 2008 due to increased fuel prices, and has since been chartered to a third-party. Salaries and benefits increased by $1.6 million, or 9.8%, primarily due to the $830,000 compensation expense related to the departure of the Chief Executive Officer and salary increases, partially offset by a decrease in incentive based compensation. Rent and purchased transportation, which primarily consists of tug charter costs, increased by $5.3 million, or 18.7%, due partially to the additional TBC in service during the first half of 2008 and increased inland purchased transportation related to increases in volume. Operating and maintenance expense increased $3.2 million, or 13.8%, primarily due to increased terminal costs related to the overall increase in volume and an increase in expenses related to the Company's stevedores, or dockside workers. Depreciation and amortization expense increased by $0.5 million, or 9.2%, due to the Company's container and chassis purchase in 2007 that were depreciated for a full year in 2008. Other operating expenses increased due to higher security expenses and legal fees of $1.7 million primarily due to the DOJ investigation, which began on April 22, 2008. As a result, the Company's operating ratio of expenses compared to revenue was higher during 2008, at 94.8% as compared to 87.8% during 2007.
EBITDA for the year ended December 31, 2008 is $13.1 million, compared to $19.8 million for the previous year. Adjusted EBITDA, which excludes stock compensation expenses, strategic alternatives expenses, losses and gains on asset sales, legal expenses related to the Anti-trust investigation, and a one-time compensation charge related to the departure of the Company's Chief Executive Officer, was $16.4 million for the year ending December 31, 2008, compared to $20.2 million for the previous year.
Financial Position
At December 31, 2008, the Company had cash and cash equivalents of $7.2 million and working capital of $10.0 million. In addition, the Company had $4.1 million in a cash reserve fund that secures long term debt and is classified as a long term asset. Trailer Bridge also has the full amount available under its $10 million revolving credit facility. During the quarter, the Company also drew $4.1 million available to it under an existing term-loan facility, secured by equipment. The funds were used for the purchase of 200 new 53 foot roll-door containers and general working capital.
Conference Call
Trailer Bridge will discuss fourth quarter results in a conference call tomorrow at 11:00 AM (Eastern Time). The dial-in numbers are:
(888) 737-9834 (US) (706) 643-9215 (International)
The call will also be simultaneously broadcast over the Internet. To listen to the live webcast, please go to www.trailerbridge.com and click on the conference call link, or go directly to: http://investor.shareholder.com/media/eventdetail.cfm?mediaid=35727&c=TRBR&mediakey=5D2DF016E446E31EE134AAFE1EA8D076&e=0.
The webcast will be archived and accessible for approximately 30 days if you are unable to listen to the live call.
Trailer Bridge provides integrated trucking and marine freight service to and from all points in the lower 48 states and Puerto Rico and Dominican Republic, bringing efficiency, service, security and environmental and safety benefits to domestic cargo in that traffic lane. This total transportation system utilizes its own trucks, drivers, trailers, containers and U.S. flag vessels to link the mainland with Puerto Rico via marine facilities in Jacksonville, San Juan and Puerto Plata. Additional information on Trailer Bridge is available at the www.trailerbridge.com website.
This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The matters discussed in this press release include statements regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to the future operating performance of the Company and its asset utilization. Investors are cautioned that any such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward looking statements as a result of various factors. Without limitation, these risks and uncertainties include the risks of economic recessions, severe weather, changes in the price of fuel, changes in demand for transportation services offered by the Company, capacity conditions in the Puerto Rico trade lane and changes in rate levels for transportation services offered by the Company.
TRAILER BRIDGE, INC.
CONDENSED STATEMENTS OF OPERATIONS
Three Months Twelve Months
Ended December 31, Ended December 31,
-------------------------- --------------------------
2008 2007 2008 2007
(Unaudited) (Unaudited)
------------ ------------ ------------ ------------
OPERATING
REVENUES $ 33,308,694 $ 31,527,042 $133,029,672 $116,152,794
OPERATING
EXPENSES:
Salaries,
wages, and
benefits 5,310,911 4,219,781 18,345,791 16,702,856
Rent and
purchased
transport-
ation 8,290,174 8,199,083 33,582,188 28,284,876
Fuel 5,621,794 6,524,700 28,510,000 18,851,635
Operating
and main-
tenance
(exclusive
of dep-
reciation
& dry-
docking
shown
separately
below) 7,076,416 6,229,416 26,174,043 23,009,628
Dry-Docking 735,589 -- 972,113 4,544
Taxes and
licenses 150,929 123,748 565,470 432,285
Insurance
and claims 887,158 834,438 3,221,112 3,226,439
Communica-
tions and
utilities 182,609 169,602 759,589 672,739
Deprecia-
tion and
amortiza-
tion 1,545,336 1,523,592 6,160,384 5,640,543
Loss (Gain)
on sale of
assets 123,048 (10,173) 232,397 55,421
Other
operating
expenses 1,936,006 1,293,867 7,546,744 5,064,093
------------ ------------ ------------ ------------
31,859,970 29,108,054 126,069,831 101,945,059
------------ ------------ ------------ ------------
OPERATING
INCOME 1,448,724 2,418,988 6,959,841 14,207,735
NONOPERATING
(EXPENSE)
INCOME:
Interest
expense (2,594,738) (2,578,794) (10,354,015) (10,274,249)
Interest
income 33,907 90,572 164,479 589,263
-------------------------- --------------------------
(LOSS) INCOME
BEFORE
(PROVISION)
BENEFIT FOR
INCOME TAXES (1,112,107) (69,234) (3,229,695) 4,522,749
(PROVISION)
BENEFIT FOR
INCOME TAXES (9,261) 1,900 (9,046) (4,773,359)
------------ ------------ ------------ ------------
NET LOSS $ (1,121,368) $ (67,334) $ (3,238,741) $ (250,610)
============ ============ ============ ============
PER SHARE
AMOUNTS:
NET LOSS PER
SHARE BASIC $ (0.09) $ (0.01) $ (0.27) $ (0.02)
============ ============ ============ ============
NET LOSS PER
SHARE
DILUTED $ (0.09) $ (0.01) $ (0.27) $ (0.02)
============ ============ ============ ============
TRAILER BRIDGE, INC.
CONDENSED BALANCE SHEET
December 31, December 31,
2008 2007
(Unaudited)
------------ ------------
ASSETS
Current Assets:
Cash and cash equivalents $ 7,216,283 $ 1,932,535
Trade receivables, less allowance for
doubtful accounts of $599,017 and
$1,010,341 16,818,259 15,794,534
Prepaid and other current assets 1,883,942 2,719,522
Deferred income taxes, net 278,856 202,001
------------ ------------
Total current assets 26,197,340 20,648,592
Property and equipment, net 89,304,822 93,762,574
Reserve fund for long-term debt 4,125,995 4,077,726
Other assets 3,704,490 4,357,554
------------ ------------
TOTAL ASSETS $123,332,647 $122,846,446
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable 5,259,355 $ 6,918,764
Accrued liabilities 7,694,690 5,961,347
Unearned revenue 385,458 446,774
Current portion of long-term debt 2,874,700 2,008,220
------------ ------------
Total current liabilities 16,214,203 15,335,105
Other accrued liabilities 414,910 --
Long-term debt, less current portion 108,545,228 106,098,506
------------ ------------
TOTAL LIABILITIES 125,174,341 121,433,611
------------ ------------
Commitments and Contingencies -- --
Stockholders' Equity:
Preferred stock, $.01 par value,
1,000,000, shares authorized; no
shares issued or outstanding -- --
Common stock, $.01 par value,
20,000,000 shares authorized;
11,938,921 and 11,931,564 shares
issued; 11,838,921 and 11,931,564
shares outstanding 119,389 119,316
Additional paid-in capital 53,460,783 53,076,644
Deficit (55,021,866) (51,783,125)
Less treasury stock at cost, 100,000
shares at 2008 (400,000) --
------------ ------------
TOTAL STOCKHOLDERS' (DEFICIT) EQUITY (1,841,694) 1,412,835
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS'
(DEFICIT) EQUITY $123,332,647 $122,846,446
============ ============
TRAILER BRIDGE, INC.
STATEMENT OF CASH FLOWS
December 31, December 31,
2008 2007
(Unaudited)
------------ ------------
Operating activities:
Net loss $ (3,238,741) $ (250,610)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 6,160,384 5,636,298
Amortization of loan costs 745,439 747,479
Non-cash stock compensation expense 399,600 397,239
Provision for doubtful accounts 913,009 1,662,918
Deferred tax expense (76,855) 4,666,761
Loss (gain) on sale of fixed assets 232,397 55,421
Decrease (increase) in:
Trade receivables (1,936,734) (1,381,282)
Prepaid and other current assets 835,580 (343,050)
Other assets (38,579) (298,176)
Increase (decrease) in:
Accounts payable (1,698,434) 1,512,984
Accrued liabilities 2,148,253 (319,114)
Unearned revenue (61,316) (118,420)
--------------------------
Net cash provided by operating
activities 4,384,003 11,968,448
--------------------------
Investing activities:
Purchases of property and equipment (2,094,797) (19,820,356)
Proceeds from sale of property and
equipment 181,761 347,666
Additions to other assets (124,058) (261,325)
------------ ------------
Net cash used in investing
activities (2,037,094) (19,734,015)
------------ ------------
Financing activities:
Payments on borrowing from affiliate -- (888,132)
Exercise of stock options - cashless &
traditional method (15,388) 323,491
Purchase of Treasury Stock (400,000) --
Cash received from notes payable 5,433,030 4,561,760
Principal payments on notes payable (2,080,803) (1,208,902)
------------ ------------
Net cash provided by (used in)
financing activities 2,936,839 2,788,217
------------ ------------
Net increase (decrease) in cash and cash
equivalents 5,283,748 (4,977,350)
Cash and cash equivalents, beginning of
the period 1,932,535 6,909,885
------------ ------------
Cash and cash equivalents, end of the
period 7,216,283 1,932,535
============ ============
TRAILER BRIDGE, INC.
RECONCILIATION OF GAAP NET LOSS, TO EARNINGS BEFORE INTEREST TAXES
DEPRECIATION & AMORTIZATION AND
ADJUSTED EARNINGS BEFORE INTEREST TAXES DEPRECIATION &
AMORTIZATION (1)
Three Months Twelve Months
Ended December 31, Ended December 31,
-------------------------- --------------------------
2008 2007 2008 2007
-------------------------- --------------------------
GAAP, Net
loss (1,121,368) (67,334) (3,238,741) (250,610)
Net
interest
expense 2,560,831 2,488,222 10,189,536 9,684,986
Provision
for income
taxes 9,261 (1,900) 9,046 4,773,359
Deprecia-
tion and
amortiza-
tion 1,545,336 1,523,592 6,160,384 5,640,543
------------------------------------------------------
Non-GAAP
EBITDA 2,994,060 3,942,580 13,120,225 19,848,278
------------------------------------------------------
Adjustments:
Stock
compensa-
tion 99,900 151,680 399,601 397,239
Strategic
altrerna-
tive fees 390,231
Loss (gain)
on asset
sales 123,048 (10,173) 232,397 55,421
Anti-trust
related
legal
expense 340,682 1,464,347
CEO sever-
ance pack-
age 829,820 829,820
------------------------------------------------------
Non-GAAP
Adjusted
EBITDA 4,387,510 4,084,087 16,436,621 20,300,938
======================================================
Other
financial
measures
EBITDA
margin 9.0% 12.5% 9.9% 17.1%
Adjusted
EBITDA
margin 13.2% 13.0% 12.4% 17.5%
Net Debt to
adjusted
EBITDA NA NA 6.5x 5.1x
Adjusted
EBITDA to
interest
expense 1.7 1.6 1.6 2.0
Use of Non-GAAP measures
------------------------
(1) The Company reports its financial results in accordance with
U.S. generally accepted accounting principles (GAAP). The Company
also believes that the presentation of certain non-GAAP measures,
i.e., results excluding certain costs and expenses, provides useful
information for the understanding of its ongoing operations and
enables investors to focus on comparisons of operating performance
from period to period without the impact of significant special
items. Non-GAAP measures are reconciled in the accompanying financial
table. The Company cautions that non-GAAP measured should be
considered in addition to, but not as a substitute for the Company's
reported GAAP results.