1997 Second Quarter ResultsTrailer Bridge, Inc. Press Release Contact: Mark A. Tanner Trailer Bridge Reports Second Quarter Results JACKSONVILLE, Fla. -- Trailer Bridge, Inc. reported total revenue of $16,170,687 for the three months ended June 30, 1997, an increase of 13.3% compared to the second quarter of 1996. Puerto Rico revenue of $14,746,313 represented an increase of 19.8% from the year earlier period during which only one of the Company’s vessels was in service along with a smaller substitute vessel while mid-bodies were being inserted. Second quarter operating income prior to a non-recurring, non-cash charge was $1,795,240, an improvement of $2.0 million from the $187,342 operating loss in the year earlier period when the company had reduced revenue and additional costs associated with the mid-body project. As a result, Trailer Bridge’s operating ratio was 88.9% during the second quarter of 1997, a significant improvement over the 101.3% operating ratio during the year earlier quarter. Interest expense of $259,565 represented a 5.7% increase compared to the year earlier period. After a pro forma expense for federal and state income taxes (Trailer Bridge operated as an S Corporation until its July 24, 1997 initial public offering), net income prior to a non-recurring, non-cash charge was $933,786 or $.14 per share compared to a net loss of $199,468 or $.03 per share. In connection with the grant of an option by the company's majority stockholder to its Chairman and CEO, a non-recurring, non-cash charge for compensation expense and an offsetting credit to additional paid-in-capital of $8.5 million was recorded during the second quarter. The charge, which represents the difference between the exercise price and the deemed fair market value of the option, has not resulted in any impairment in the book value or financial condition of the company. This charge has resulted in a net loss of $5.3 million or $.79 per share during the second quarter of 1997 as shown in the attached table. Because the option does not involve the issuance of additional shares of stock by the company, any subsequent purchase of shares under the option will not have a dilutive effect on the company's book value or earnings per share amounts. On July 24, 1997, Trailer Bridge completed the initial public offering of its common stock, raising approximately $25.1 million, which will be utilized to purchase revenue equipment, reduce indebtedness and increase working capital. John D. McCown, Chairman and CEO said: "With this offering, we are in a better position to extend the benefits of our proven transportation system to more customers. The competitive strengths of our unique integrated truckload and vessel system allow us to offer both sustainable value and enhanced service. We will grow by leveraging on those strengths in current and new traffic lanes." Trailer Bridge provides truckload service to and from all points in the lower 48 states and Puerto Rico. This total transportation system utilizes its own trucks, drivers, trailers, vessels and marine facilities in Jacksonville and San Juan. Trailer Bridge's founder and majority stockholder is Malcom P. McLean, the transportation pioneer who invented containerization forty years ago.
(a) Includes an $8,528,670 non-recurring, non-cash charge for compensation expense and credit to paid-in-capital relating to an option granted by the majority shareholder to the company's Chairman and CEO; net income includes proforma income taxes as a C corporation including a $2,340,894 deferred tax benefit from the foregoing option.
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