DALLAS, April 27, 2011 (GLOBE NEWSWIRE) -- Frozen Food Express Industries, Inc. (Nasdaq:FFEX) today announced its financial and operating results for the quarter ended March 31, 2011. Highlights for the quarter include:
- Total operating revenue increased $6.3 million to $92.1 million in the first quarter of 2011 compared to $85.8 million in the same period of 2010.
- Total operating revenue, net of fuel surcharges, increased slightly to $73.4 million, compared to $73.3 million during the first quarter of 2010.
- Favorable pricing and improving demand were offset by unusually severe weather and increased fuel costs, resulting in a $7.9 million loss during the first quarter of 2011, compared to a $3.7 million loss in the same period of 2010.
- Net loss per share of diluted common stock was ($0.45) in the first quarter of 2011 compared to ($0.22) in the same period of 2010.
- New four year, $50 million credit facility increases liquidity and long-term financial flexibility.
For the first quarter ended March 31, 2011, total operating revenue increased $6.3 million to $92.1 million compared to $85.8 million in the same period of last year. Total operating revenue, net of fuel surcharges, increased slightly to $73.4 million, compared to $73.3 million in the same period of 2010. The net loss for the first quarter ended March 31, 2011 was $7.9 million, or ($0.45) per diluted share, compared to $3.7 million, or ($0.22) per diluted share in the same quarter a year ago.
| Total Operating Revenue (in $000s) from: | 1Q11 | 1Q10 | % Change |
| Total Truckload | 45,141 | 44,916 | 0.5% |
| Less-than-truckload | 26,201 | 25,267 | 3.7% |
| Brokerage and Equipment Rental | 2,082 | 3,125 | (33.4%) |
| Total Operating Revenue (Excluding Fuel Surcharges) | 73,424 | 73,308 | 0.4% |
| Fuel Surcharges | 18,683 | 12,534 | 49.1% |
| Total Operating Revenue | 92,107 | 85,842 | 7.3% |
"Despite severe weather that curtailed many customer operations in January and February, truckload revenue during the first quarter of 2011 was relatively flat in comparison with the same period a year ago. Continued capacity constraint in the truckload sector provided pricing strength in this segment that was able to offset the 5.7% decline in loaded miles that was influenced by the bad weather," said Russell Stubbs, the Company's President and Chief Executive Officer. "Demand for our less-than-truckload services continued to improve during the first quarter with a 6.3% increase in tonnage. This more than offset competitive pricing pressures that this segment continues to face, and resulted in a 3.7% increase in sales from this segment. This growth, year over year, was remarkable considering our major less-than-truckload markets of Dallas-Fort Worth, Atlanta, Chicago and the Northeast, served by our Burlington, New Jersey facility, lost numerous revenue days in January and February due to heavy winter storms."
During the first quarter of 2011, total operating expenses increased $9.5 million, or 10.4% to $100.9 million compared to $91.4 million during the first quarter of 2010. "U.S. diesel fuel prices increased approximately 34% compared to last year's first quarter and 30% since the beginning of 2011. Our fuel surcharge program is typically able to recapture most of the increasing costs of fuel prices, but we shoulder more of the burden in an environment with rapidly rising fuel prices, as was the case during first quarter of 2011. Our fuel costs increased by $6.6 million versus a $6.1 million increase in fuel surcharges. Operating costs were also negatively affected by approximately $800,000 of increased maintenance and repair costs attributable to inclement weather," continued Mr. Stubbs. "Excluding the effects of fuel, increased maintenance and additional expenses resulting from inclement weather, the change in our other operating costs were in line with the change in revenue, which is indicative of our cost control measures and efficiency programs."
"A shortage of qualified drivers in the market continues to challenge the industry. We opened the FFE Driver Academy during the first quarter, which has been a cost effective way to attract and retain qualified drivers. Pricing strength in our truckload segment, improving demand, and fuel surcharges were not enough to offset the significant increase in diesel fuel costs and the severe weather conditions, which resulted in disappointing results for the first quarter of 2011. However, we experienced improvement in financial performance during March, as weather patterns normalized and demand and yield continued to improve. We are encouraged by the response to our new driving academy as this will help address the driver shortage, which is one of our most significant challenges. Combined with our continued emphasis on a strong service offering, strength in pricing in the truckload market and solid LTL growth, we believe we will see improved results in the coming quarters, "concluded Mr. Stubbs.
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. We also provide 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.
The Frozen Food Express Industries, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3209
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 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, 2011 |
December 31, 2010 |
| Current assets | ||
| Cash and cash equivalents | $ 2,090 | $ 1,203 |
| Accounts receivable, net | 43,614 | 41,921 |
| Tires on equipment in use, net | 5,858 | 5,982 |
| Deferred income taxes | 1,150 | 1,150 |
| Other current assets | 4,764 | 6,575 |
| Total current assets | 57,476 | 56,831 |
| Property and equipment, net | 70,146 | 72,993 |
| Other assets | 4,550 | 5,081 |
| Total assets | $ 132,172 | $ 134,905 |
| Liabilities and Shareholders' Equity | ||
| Current liabilities | ||
| Accounts payable | $ 25,722 | $ 27,443 |
| Insurance and claims accruals | 8,850 | 8,697 |
| Accrued payroll and deferred compensation | 4,248 | 5,032 |
| Accrued liabilities | 813 | 709 |
| Total current liabilities | 39,633 | 41,881 |
| Long-term debt | 13,668 | 5,689 |
| Deferred income taxes | 2,180 | 3,153 |
| Insurance and claims accruals | 5,511 | 5,373 |
| Total liabilities | 60,992 | 56,096 |
| 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 | 1,145 | 1,353 |
| Retained earnings | 50,305 | 58,242 |
| 79,308 | 87,453 | |
| Treasury stock (1,081 and 1,146 shares), at cost | (8,128) | (8,644) |
| Total shareholders' equity | 71,180 | 78,809 |
| Total liabilities and shareholders' equity | $ 132,172 | $ 134,905 |
| 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, |
||
| 2011 | 2010 | |
| Total operating revenue | $ 92,107 | $ 85,842 |
| Operating expenses | ||
| Salaries, wages and related expenses | 29,460 | 28,109 |
| Purchased transportation | 16,216 | 18,117 |
| Fuel | 22,467 | 15,844 |
| Supplies and maintenance | 12,622 | 10,613 |
| Revenue equipment rent | 8,604 | 8,781 |
| Depreciation | 4,496 | 3,987 |
| Communications and utilities | 1,299 | 1,174 |
| Claims and insurance | 3,309 | 2,834 |
| Operating taxes and licenses | 1,035 | 1,097 |
| Loss (gain) on sale of property and equipment | 1 | (331) |
| Miscellaneous | 1,380 | 1,179 |
| Total operating expenses | 100,889 | 91,404 |
| Loss from operations | (8,782) | (5,562) |
| Interest and other (income) expense | ||
| Interest income | (2) | (11) |
| Interest expense | 96 | 42 |
| Equity in earnings of limited partnership | (99) | (40) |
| Life insurance and other | 100 | 146 |
| Total interest and other expense | 95 | 137 |
| Loss before income taxes | (8,877) | (5,699) |
| Income tax benefit | (940) | (1,976) |
| Net loss | $ (7,937) | $ (3,723) |
| Net loss per share of common stock | ||
| Basic | $ (0.45) | $ (0.22) |
| Diluted | $ (0.45) | $ (0.22) |
| Weighted average shares outstanding | ||
| Basic | 17,446 | 17,092 |
| Diluted | 17,446 | 17,092 |
| Dividends declared per common share | $ -- | $ -- |
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) | 2011 | 2010 |
| Temperature-controlled services | $ 29,416 | $ 25,423 |
| Dry-freight services | 11,420 | 15,268 |
| Total truckload linehaul services | 40,836 | 40,691 |
| Dedicated fleets | 4,305 | 4,225 |
| Total truckload | 45,141 | 44,916 |
| Less-than-truckload linehaul services | 26,201 | 25,267 |
| Fuel surcharges | 18,683 | 12,534 |
| Brokerage | 1,138 | 2,011 |
| Equipment rental | 944 | 1,114 |
| Total operating revenue | 92,107 | 85,842 |
| Operating expenses | 100,889 | 91,404 |
| Loss from freight operations | $(8,782) | $(5,562) |
| Operating ratio (b) | 109.5% | 106.5% |
| Total truckload revenue | $ 45,141 | $ 44,916 |
| Less-than-truckload revenue | 26,201 | 25,267 |
| Total linehaul and dedicated services revenue | $ 71,342 | $ 70,183 |
| Weekly average trucks in service | 1,774 | 1,751 |
| Revenue per truck per week (c) | $ 3,128 | $ 3,118 |
| 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 | 2011 | 2010 | |
| Total linehaul miles (a) | 29,891 | 31,630 | |
| Loaded miles (a) | 26,636 | 28,238 | |
| Empty mile ratio (b) | 10.9% | 10.7% | |
| Linehaul revenue per total mile (c) | $ 1.37 | $ 1.29 | |
| Linehaul revenue per loaded mile (d) | $ 1.53 | $ 1.44 | |
| Linehaul shipments (a) | 29.2 | 30.7 | |
| Loaded miles per shipment (e) | 912 | 921 | |
| LTL | |||
| Hundredweight | 1,934 | 1,820 | |
| Shipments (a) | 61.0 | 59.1 | |
| Linehaul revenue per hundredweight (f) | $ 13.55 | $ 13.89 | |
| Linehaul revenue per shipment (g) | $ 430 | $ 427 | |
| Average weight per shipment (h) | 3,172 | 3,079 | |
| Computational notes: | |||
| (a) Amounts are stated 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 total truckload 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 shipments. | |||
The following table summarizes and compares the makeup of our fleet between company-provided tractors and tractors provided by independent contractors as of March 31:
| 2011 | 2010 | |
| Total company tractors available | 1,529 | 1,461 |
| Total owner-operator tractors available | 294 | 393 |
| Total tractors available | 1,823 | 1,854 |
| Total trailers available | 3,367 | 3,493 |