1999 Fourth Quarter ResultsTrailer Bridge, Inc. Press Release Contact: John D. McCown Trailer Bridge Reports Fourth Quarter Results JACKSONVILLE, Fla. --
Trailer Bridge,
Inc. (TRBR)
reported
total revenue of $22,489,269 for the three months ended December 31, 1999, a
decrease of $1,143,673 or 4.8% compared to the fourth quarter of 1998 when
market volumes swelled in the aftermath of Hurricane Georges.
Compared to the third quarter of 1999, revenue increased $1,863,470
or 9.0%. Based primarily upon a
change in itinerary involving the same number of deployed vessels, Trailer
Bridge had 10.0% more overall vessel capacity deployed to Puerto Rico
compared to the fourth quarter of 1998 and 28.1% more overall vessel
capacity deployed to Puerto Rico compared to the third quarter of 1999. Fourth quarter operating income was $353,297, an increase of $3,698,068 from the $3,344,771 operating loss in the year earlier period and an increase of $2,599,123 in operating income from the third quarter of 1999 prior to the recognition of a $3,710,000 non-recurring benefit. Compared to the fourth quarter of 1998, operating income was higher primarily due to the absence of additional costs estimated at $3,358,709 related to the disruption resulting from the loss of use of the San Juan ramp due to Hurricane Georges. Compared to the third quarter of 1999 prior to the recognition of the non-recurring benefit, operating income was higher due to added revenue generated from volume increases across most sectors and lower costs per unit. As a result of the above, the operating ratio was 98.4% during the fourth quarter of 1999 compared to the 114.2% operating ratio during the year earlier period and the 110.9% during the third quarter of 1999 prior to the non-recurring benefit. Net interest expense of $980,271 was up $638,224 from the year earlier period that included less debt, lower interest rates and more interest income on short-term investments. Loss
before income taxes for the fourth quarter was $628,766, an improvement of
$3,041,362 from the year earlier period and an improvement of $2,502,475
from the third quarter of 1999 prior to the recognition of the
non-recurring benefit. After
income taxes, net loss for the fourth quarter was $398,977 compared to the
net loss of $2,298,679 for the year earlier period.
Net loss per share was $.04 for the fourth quarter compared to net
loss per share of $.24 for the year earlier period. At December 31, 1999, cash amounted to $2.4 million. Trailer Bridge was not in compliance with certain financial covenants related to its revolving credit at December 31, 1999 but has received a proposal from its lender to waive and amend those financial covenants and is in discussions with that lender. Trailer Bridge expects to obtain a satisfactory waiver or amendment. The Company believes that it presently has sufficient capital resources and liquidity and it is current on all payments related to all of its financial obligations and anticipates remaining so in the future without any extension of scheduled payments necessary or requested. For the fourth quarter of 1999, comparing total volume and total revenue by direction, Trailer Bridge’s effective yield to and from Puerto Rico increased 2.3% and 6.4%, respectively, compared to the same period last year. The recent nature of most of this yield improvement is evident by another comparison. Compared to the third quarter of 1999, the effective average yield on Trailer Bridge’s business to Puerto Rico increased 3.8% and the effective average yield on business from Puerto Rico increased 12.3%. The Company’s Puerto Rico deployed vessel capacity utilization during the fourth quarter was 73.2% to Puerto Rico and 24.4% from Puerto Rico. These were below comparable figures of 87.8% to Puerto Rico and 25.5% from Puerto Rico during the fourth quarter of 1998 when market volumes swelled in the aftermath of Hurricane Georges. Compared to third quarter of 1999 capacity utilization of 82.7% to Puerto Rico and 32.8% from Puerto Rico, the fourth quarter represented a meaningful decline in both the southbound and northbound lanes as a result of the added capacity deployed to Puerto Rico from the change in itinerary of the same number of vessels. All of these capacity utilization figures are based upon vessels deployed in service and exclude the effect of two Triplestack Box CarriersÔ that are presently laid-up. Total net expenses related to these two vessels, consisting primarily of depreciation and interest, were $268,176 during the fourth quarter. When deployed, these two vessels will increase Trailer Bridge’s in service fleet capacity by approximately 31%. Trailer Bridge’s business model involves a high degree of operating leverage with changes in volume having a disproportionate effect on overall results. Based upon its cost structure and the fixed versus variable nature of those costs, Trailer Bridge believes that its present incremental cost to handle additional volume within its system is lower than that of any of its competitors. For January, 2000, deployed vessel capacity utilization was 66.3% to Puerto Rico and 24.4% from Puerto Rico, for February it was 74.9% to Puerto Rico and 26.0% from Puerto Rico and for the first two weeks of March, 2000, it was 79.0% to Puerto Rico and 30.3% from Puerto Rico. Each of the two laid-up vessels referenced above have been chartered out for a portion of the first quarter of 2000. John D. McCown, Chairman and CEO, said: “We drove down our operating costs per unit 6% compared to the third quarter. That and improvement in our yield led to a 12.5 percentage point improvement in our operating ratio. The Puerto Rico freight market has significant excess capacity but our unique transportation system puts us in the best position to weather this unsustainable competitive storm. I believe a defining characteristic of this market, beyond the advancing age of our competitors’ vessels which are now 28.4 years old on average, will be Trailer Bridge’s success relative to those same competitors. As 2000 progresses, it will be clear to others what is already clear to us: we have the best business model for competing in this market, now and particularly in the future.” Trailer Bridge will discuss fourth quarter results in a conference call at 4:00 P.M. (Eastern Time) on Tuesday, March 21, 2000 that will simultaneously be broadcast over the Internet through Investor Broadcast Networks’ Vcall website, located at www.vcall.com. To listen to the live call please go to the website at least fifteen minutes early to register, download and install any necessary audio software. Trailer Bridge provides integrated trucking and marine freight service to and from all points in the lower 48 states and Puerto Rico, bringing efficiency, environmental and safety benefits to domestic cargo in that traffic lane. This total transportation system utilizes its own trucks, drivers, trailers, containers, U.S. flag vessels and marine facilities in Jacksonville, New York and San Juan. Trailer Bridge’s founder and majority stockholder is Malcom P. McLean, the transportation pioneer who invented containerization forty years ago. 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. 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, changes in demand for transportation services offered by the Company, and changes in rate levels for transportation services offered by the Company.
TRAILER BRIDGE, INC.
STATEMENT OF OPERATIONS
(Unaudited)
Three Months
Ended December 31,
1999 1998
OPERATING REVENUES.................... $22,489,269 $23,632,942
OPERATING EXPENSES:
Salaries, wages, and benefits........ 4,164,087 4,310,434
Rent and purchased transportation:
Related Party....................... 1,849,200 1,849,200
Other............................... 6,292,136 7,615,091
Fuel................................. 1,901,479 1,620,093
Operating and maintenance
(exclusive of depreciation shown
separately below).................. 4,867,634 8,249,368
Taxes and licenses................... 45,069 216,298
Insurance and claims................. 565,191 615,144
Communications and utilities......... 150,272 260,376
Depreciation and amortization........ 1,263,066 1,015,561
Other operating expenses............. 1,037,836 1,226,148
---------- ----------
22,135,972 26,977,713
---------- ----------
OPERATING (LOSS) INCOME............... 353,297 (3,344,771)
NON OPERATING INCOME (EXPENSE):
Interest expense, net (980,271) (342,047)
Gain on sale of equipment, net (1,792) 16,690
---------- ----------
(982,063) (325,357)
---------- ----------
(LOSS) INCOME BEFORE BENEFIT
(PROVISION) FOR INCOME TAXES (628,766) (3,670,128)
BENEFIT (PROVISION) FOR INCOME TAXES 229,789 1,371,449
---------- ----------
NET (LOSS) INCOME (398,977) (2,298,679)
---------- ----------
NET (LOSS) INCOME PER SHARE........... $ (0.04) $ (0.24)
---------- ----------
WEIGHTED AVERAGE SHARES OUTSTANDING... 9,777,500 9,777,500
|
|
