DALLAS, April 29, 2013 (GLOBE NEWSWIRE) -- Frozen Food Express Industries, Inc. (Nasdaq:FFEX) today announced its financial and operating results for the quarter ended March 31, 2013. Highlights from first quarter 2013 financial results include:
- 1Q13 total operating revenue was $97.8 million, an 11.3% increase versus 1Q12
- 1Q13 revenue per truck per week increased 2.0% to $3,339, compared to $3,275 during 1Q12
- 1Q13 operating ratio improved to 104.1%, compared to 105.9% during 1Q12
- 1Q13 net loss improved to $3.3 million, compared to a $5.6 million loss during 1Q12
- 1Q13 net loss per share of diluted common stock was ($0.18), compared to ($0.32) during 1Q12
| Revenue (in $ millions) from: | 1Q13 | 1Q12 | % Change |
| Total Truckload ("TL") | 37.9 | 34.8 | 9.0% |
| Less-than-truckload ("LTL") | 33.4 | 28.3 | 17.8% |
| Brokerage, Logistics and Equipment Rental | 6.7 | 7.0 | (4.2%) |
| Operating Revenue (Excluding Fuel Surcharges) | 78.0 | 70.1 | 11.2% |
| Fuel Surcharges | 19.8 | 17.8 | 11.3% |
| Total Operating Revenue | 97.8 | 87.9 | 11.3% |
"The execution of our strategic plan continues to deliver solid growth in revenue and improvement in operating profitability. During the first quarter, TL and LTL revenue grew 9.0% and 17.8% respectively, keeping pace with a 12.0% growth in the number of trucks in service. Volumes and pricing trends were favorable and were only slightly offset by an increase in the empty mile ratio," said Russell Stubbs, the Company's President and Chief Executive Officer. "Brokerage, logistics and equipment rental revenue was relatively unchanged from the prior year at approximately $7 million, as the effect of exiting an unprofitable dedicated service relationship last year was offset by a $0.6 increase in equipment rental revenue and slight growth in water transport services."
During the first quarter of 2013, total operating expenses increased $8.7 million, or 9.4%, to $101.9 million compared to $93.1 million during the first quarter of 2012. The primary factor related to the year-over-year increase in operating expenses was the increase in TL linehaul miles of 12.0% and LTL tonnage of 9.9% versus the first quarter of 2012. To handle this volume, the Company increased the number of weekly average trucks in service to 1,660, versus 1,482 during the same period last year. A significant part of this increase in trucks came from independent owner operators as the Company focused on growing its fleet by utilizing this resource. During the same time period, salaries, wages and related expenses, which includes both drivers and non-driver compensation, decreased $218,000, or 0.7%. The Company experienced excellent claims and insurance results in the first quarter of 2012, thus the Company expected the increase in claims and insurance expense in 2013 of $1.5 million, which actually was below budget for the quarter. Operating expense also compared negatively in the first quarter of 2013 versus the first quarter of 2012 due to a $1.5 million decline in gain on equipment sales, year over year.
During the first quarter, the operating ratio improved to 104.1% compared to 105.9% last year, as the pace of revenue growth outpaced growth in expenses. The operating ratio improvement was primarily related to strategic decisions implemented over the past 18 months to exit less profitable businesses, refresh the average age of the fleet and increase efficiencies.
The Company expects 2013 capital expenditures will not exceed $3 million, net of proceeds from dispositions.
"During the first quarter, we achieved cost savings from our younger and more fuel efficient fleet. We improved yields and grew volumes in our temperature control services. While we still have progress to make, we have successfully repositioned our Company, and I am confident that we have the right plan in place to restore the Company to profitability during 2013 and restore more meaningful profitability in the years to come," Mr. Stubbs concluded.
About FFEX
Frozen Food Express Industries, Inc. is one of the leading temperature-controlled truckload and less-than-truckload carriers in the United States with core operations in the transport of temperature-controlled products and perishable goods including food, health care and confectionery products. Service is offered in over-the-road and intermodal modes for temperature-controlled truckload and less-than-truckload, as well as dry truckload on a non-dedicated fleet basis. We also provide bulk tank water transportation, brokerage/logistics and dedicated services to our customers. Additional information about Frozen Food Express Industries, Inc. can be found at http://www.ffeinc.com. To join our email alert list, please click on the following link: http://financials.ffex.net/alerts.cfm. The Company's common stock is traded on the Nasdaq Global Select market under the symbol FFEX.
Forward-Looking Statements
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements relating to plans, strategies, objectives, expectations, intentions, and adequacy of resources, and may be identified by words such as "will", "could", "should", "believe", "expect", "intend", "plan", "schedule", "estimate", "project", and similar expressions. Those statements are based on current expectations and are subject to uncertainty and change. Although our management believes that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized. Should one or more of the risks or uncertainties underlying such expectations not materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. Among the key factors that are not within our management's control and that may cause actual results to differ materially from those projected in such forward-looking statements are demand for the Company's services and products, and its ability to meet that demand, which may be affected by, among other things, competition, weather conditions and the general economy, the availability and cost of labor and owner-operators, the ability to negotiate favorably with lenders and lessors, the continued growth of hydraulic fracturing techniques for oil and gas drilling in West Texas, the effects of terrorism and war, the availability and cost of equipment, fuel and supplies, the market for previously-owned equipment, the impact of changes in the tax and regulatory environment in which the Company operates, operational risks and insurance, risks associated with the technologies and systems used and the other risks and uncertainties described in our filings with the Securities and Exchange Commission. Given the volatility in fuel prices and the impact fuel surcharge revenues have on total operating revenues, we often make reference to total operating revenue excluding fuel surcharges to provide a more consistent basis for comparison of operating revenue without the impact of fluctuating fuel prices. Readers should review and consider these factors along with the various disclosures by the Company in its press releases, stockholder reports and filings with the Securities and Exchange Commission. The Company does not assume, and specifically disclaims, any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.
| Frozen Food Express Industries, Inc. and Subsidiaries | ||
| Consolidated Condensed Balance Sheets | ||
| (Unaudited and in thousands, except per-share amounts) | ||
| Assets |
March 31, 2013 |
December 31, 2012 |
| Current assets | ||
| Cash and cash equivalents | $ 1,006 | $ 2,907 |
| Accounts receivable, net of allowance for doubtful accounts of $1,171 and $1,565, respectively | 40,876 | 40,069 |
| Tires on equipment in use, net | 8,674 | 8,176 |
| Equipment held for sale | -- | 832 |
| Other current assets | 6,441 | 7,840 |
| Total current assets | 56,997 | 59,824 |
| Property and equipment, net | 52,589 | 54,680 |
| Deferred income taxes | 3,039 | 3,039 |
| Other assets | 4,241 | 6,096 |
| Total assets | $ 116,866 | $ 123,639 |
| Liabilities and Shareholders' Equity | ||
| Current liabilities | ||
| Accounts payable | $ 24,778 | $ 26,178 |
| Insurance and claims accruals | 8,397 | 10,033 |
| Accrued payroll and deferred compensation | 4,214 | 3,951 |
| Accrued liabilities | 1,263 | 1,429 |
| Current maturities of notes payable and capital lease obligations | 3,102 | 3,040 |
| Deferred income taxes | 2,727 | 2,727 |
| Total current liabilities | 44,481 | 47,358 |
| Borrowings under credit facility | 25,839 | 26,215 |
| Long-term notes payable and capital lease obligations | 16,095 | 16,891 |
| Insurance and claims accruals | 5,275 | 4,904 |
| Total liabilities | 91,690 | 95,368 |
| Shareholders' equity | ||
| Common stock, $1.50 par value per share; 75,000 shares authorized; 18,572 shares issued | 27,858 | 27,858 |
| Additional paid-in capital | 863 | 1,165 |
| Accumulated other comprehensive loss | (77) | (79) |
| Retained earnings | 3,261 | 6,516 |
| Total common shareholders' equity | 31,905 | 35,460 |
| Treasury stock (962 and 1,026 shares), at cost | (6,729) | (7,189) |
| Total shareholders' equity | 25,176 | 28,271 |
| Total liabilities and shareholders' equity | $ 116,866 | $ 123,639 |
| Frozen Food Express Industries, Inc. and Subsidiaries | ||
| Consolidated Condensed Statements of Operations | ||
| (Unaudited and in thousands, except per-share amounts) | ||
| Three Months | ||
| Ended March 31, | ||
| 2013 | 2012 | |
| Total operating revenue | $ 97,831 | $ 87,935 |
| Operating expenses | ||
| Salaries, wages and related expenses | 29,007 | 29,225 |
| Purchased transportation | 19,646 | 15,833 |
| Fuel | 18,949 | 19,017 |
| Supplies and maintenance | 12,953 | 12,404 |
| Revenue equipment rent | 12,200 | 10,212 |
| Depreciation | 2,882 | 3,059 |
| Communications and utilities | 1,007 | 933 |
| Claims and insurance | 3,412 | 1,905 |
| Operating taxes and licenses | 960 | 1,087 |
| Gain on sale of property and equipment | (266) | (1,760) |
| Miscellaneous | 1,111 | 1,233 |
| Total operating expenses | 101,861 | 93,148 |
| Loss from operations | (4,030) | (5,213) |
| Interest and other (income) expense | ||
| Interest expense | 626 | 371 |
| Equity in loss (earnings) of limited partnership | 10 | (235) |
| Gain on sale of investment in limited partnership | (1,649) | -- |
| Other | 186 | 242 |
| Total interest and other (income) expense | (827) | 378 |
| Loss before income taxes | (3,203) | (5,591) |
| Income tax expense | 52 | 58 |
| Net loss | $ (3,255) | $ (5,649) |
| Net loss per share of common stock | ||
| Basic | $ (0.18) | $ (0.32) |
| Diluted | $ (0.18) | $ (0.32) |
| Weighted average shares outstanding | ||
| Basic | 17,924 | 17,727 |
| Diluted | 17,924 | 17,727 |
The following table summarizes and compares the significant components of revenue and presents our operating ratio and revenue per truck per week for each of the three-month periods ended March 31:
| Revenue from: (a) | 2013 | 2012 |
| Temperature-controlled services | $ 28,136 | $ 24,502 |
| Dry-freight services | 6,168 | 5,445 |
| Total truckload linehaul services | 34,304 | 29,947 |
| Dedicated services | 3,605 | 4,836 |
| Total truckload | 37,909 | 34,783 |
| Less-than-truckload linehaul services | 33,358 | 28,306 |
| Fuel surcharges | 19,811 | 17,794 |
| Brokerage and logistics services | 5,224 | 6,116 |
| Equipment rental | 1,529 | 936 |
| Total operating revenue | 97,831 | 87,935 |
| Operating expenses | 101,861 | 93,148 |
| Loss from operations | $ (4,030) | $ (5,213) |
| Operating ratio (b) | 104.1% | 105.9% |
| Total truckload revenue | $ 37,909 | $ 34,783 |
| Less-than-truckload linehaul revenue | 33,358 | 28,306 |
| Total linehaul and dedicated services revenue | $ 71,267 | $ 63,089 |
| Weekly average trucks in service | 1,660 | 1,482 |
| Revenue per truck per week (c) | $ 3,339 | $ 3,275 |
| Computational notes: | ||
| (a) Revenue and expense amounts are stated in thousands of dollars. | ||
| (b) Operating expenses divided by total revenue. | ||
| (c) Average daily revenue times seven divided by weekly average trucks in service. | ||
The following table summarizes and compares selected statistical data relating to our freight operations for each of the three-month periods ended March 31:
| Truckload | 2013 | 2012 |
| Total linehaul miles (a) | 23,009 | 20,550 |
| Loaded miles (a) | 20,142 | 18,156 |
| Empty mile ratio (b) | 12.5% | 11.6% |
| Linehaul revenue per total mile (c) | $ 1.49 | $ 1.46 |
| Linehaul revenue per loaded mile (d) | $ 1.70 | $ 1.65 |
| Linehaul shipments (a) | 22.0 | 19.6 |
| Loaded miles per shipment (e) | 917 | 929 |
| Less-than-truckload | ||
| Hundredweight (a) | 2,201 | 2,004 |
| Shipments (a) | 75.9 | 67.1 |
| Linehaul revenue per hundredweight (f) | $ 15.16 | $ 14.13 |
| Linehaul revenue per shipment (g) | $ 440 | $ 422 |
| Average weight per shipment (h) | 2,901 | 2,986 |
| Computational notes: | ||
| (a) In thousands. | ||
| (b) Total truckload linehaul miles less truckload loaded miles divided by total truckload linehaul miles. | ||
| (c) Revenue from truckload linehaul services divided by truckload total linehaul miles. | ||
| (d) Revenue from truckload linehaul services divided by truckload loaded miles. | ||
| (e) Total truckload loaded miles divided by number of truckload linehaul shipments. | ||
| (f) LTL revenue divided by LTL hundredweight. | ||
| (g) LTL revenue divided by number of LTL shipments. | ||
| (h) LTL hundredweight times one hundred divided by number of LTL shipments. | ||
The following table summarizes and compares the makeup of our fleet between company-provided tractors and tractors provided by owner-operators as of March 31:
| 2013 | 2012 | |
| Total company tractors available for freight operations | 1,342 | 1,312 |
| Total owner-operator tractors available for freight operations | 384 | 250 |
| Total tractors available for freight operations | 1,726 | 1,562 |
| Total trailers available for freight operations | 3,237 | 3,118 |