1997 Fourth Quarter ResultsTrailer Bridge, Inc. Press Release Contact: Mark A. Tanner Trailer Bridge Reports Fourth Quarter Results JACKSONVILLE, Fla. -- Trailer Bridge, Inc. reported total revenue of $17,095,725 for the three months ended December 31, 1997, a decrease of $922,488 or 5.1% compared to the fourth quarter of 1996. While core trailer volume to Puerto Rico increased 12.0% compared to the year earlier period, total car and other vehicle volume was down 17.3% compared to the year earlier period. As a result, core trailer revenue to Puerto Rico increased $610,999 or 7.2% compared to the year earlier period and car and other vehicle revenue decreased $1.1 million or 22.5% compared to the year earlier period. This reduction in vehicle revenue was due primarily to a 35.9% reduction in the level of used car shipments during the quarter as sales of used cars in Puerto Rico were soft due to several factors, including attractive new car and repossessed car pricing. New car shipments were 1.7% lower. During the forth quarter, approximately two-thirds of Trailer Bridge’s car volume was represented by new cars. Compared to the third quarter of 1997, total car and other vehicle volume increased 64.2%. Revenue from shipper owned or leased equipment moving to Puerto Rico decreased $245,620 or 19.6% primarily due to a reduction in flatbed volume. While trailer volume from Puerto Rico increased 2.2%, related revenue decreased $245,329 or 11.5% compared to the year earlier period due to continued rate pressure on the limited volumes moving inbound from Puerto Rico. Non-Puerto Rico revenue of $1,442,103 represented an increase of 2.2% Fourth quarter operating income was $1,653,154, a decrease of $662,074 or 28.6% from the $2,315,228 operating income in the year earlier period. Operating income was lower primarily due to the weakness in used car volume to Puerto Rico. Competitive pressures on overall freight rates were also a contributing factor. As a result, Trailer Bridge's operating ratio was 90.3% during the fourth quarter of 1997 compared to the 87.2% operating ratio during the year earlier quarter. Net interest expense was down substantially as a result of a reduction in debt and an increase in earnings from temporary investments. Income before income taxes for the fourth quarter was $1,696,621, a decrease of $272,195 or 13.8% from the year earlier period. After income taxes, net income for the fourth quarter was $1,103,015, or 7.6% below proforma net income of $1,193,675 for the year earlier period during which Trailer Bridge operated as an S Corporation. After the 47% increase in average shares outstanding, net income per share was .11 for the fourth quarter compared to .18 for the year earlier period. The Company's financial condition remained strong at the end of the year. At December 31, 1997, available cash amounted to $14.2 million, working capital was $14.5 million and stockholders equity was equal to $33.9 million. During the quarter, the Company completed its second Title XI bond offering which is being utilized to fund the construction of Triplestack Box CarriersTM . These Title XI bonds have an average fixed interest rate of 6.74% payable over a twenty five year term. John D. McCown, Chairman and CEO, said "Despite a shortfall in the number of used cars moving to Puerto Rico and heightened rate activity, we maintained a respectable operating ratio. The third quarter drop in new car volume has proven to be temporary and we are encouraged that the used car market is improving. The first Triplestack Box CarrierTM entered service in mid-Janaury and our first two voyages have demonstrated the superior sea speed and efficient cargo operations that result from deployment of these vessels. Preferred 53' equipment at lower linehaul cost with more frequency is a winning combination that further improves the service and value we offer to our customers." 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, containers, 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.
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