Allied Holdings Reports Second Quarter Results
25 July 2000
Strategic Initiatives Contribute to Improved Performance
DECATUR, Ga. - Allied Holdings, Inc. today reported improved results for the
second quarter ended June 30, 2000, marking the third consecutive quarter of
revenue and earnings growth.
Net income for the second quarter of 2000 was $6.9 million, or $0.87 per
share, versus net income of $4.1 million, or $0.53 per share, in the second
quarter last year; a 68% increase in earnings. Revenues for the second quarter
of 2000 were $295.9 million, a 3% increase over revenues of $287.0 million for
the second quarter last year. Revenues for the six-month period ended June
30, 2000 were $578.8 million, an improvement of 6% over revenues of
$548.2 million for the same six-month period of 1999. Net income was
$5.9 million for the first six months of 2000 compared to $0.1 million for the
same period of 1999.
"We are pleased to announce our third consecutive period of both revenue
and earnings growth and remain committed to finding ways to trim costs and
operate our businesses in the most efficient manner possible," said A.
Mitchell Poole, Jr., Allied's vice chairman and CEO. "The automotive
marketplace is becoming increasingly competitive, and the management team will
continue to identify and execute strategies that improve performance for
Allied and the customers of our operating companies."
Commenting on the second quarter results, Poole said, "The number of total
vehicles transported declined during the same period last year, but this was
more than offset by an increase in revenue generated per unit, due to revenue
enhancements and other factors including the elimination of some non-
profitable business." He added that fuel surcharges, together with fuel
hedging gains, offset increased fuel costs in the second quarter.
In addition, Poole said, "Our operating companies continue to experience
growth in new business opportunities and seek to expand their services
throughout the automotive marketplace." The Axis Group, Allied's global
logistics services business unit, continued to be profitable. Earnings for CT
Group, Inc., best known for its vehicle inspection program and acquired by
Axis in the first quarter, were also fully accretive in its first full
reporting period.
"While our results are positive and moving in the right direction," said
Poole, "we will continue to keep our focus and implement strategies that add
value to our shareholders, employees, and to all the customers served by our
operating companies. Allied is dedicated to identifying methods to continually
improve performance and reduce expenses in every area."
Allied Holdings, Inc. is the parent company of several subsidiaries
engaged in providing logistics, distribution and transportation services to
the automotive industry. The services of Allied's subsidiaries span the
entire finished vehicle distribution continuum, and include logistics, car-
hauling, intramodal transport, inspection, accessorization, and dealer prep.
Allied, through its subsidiaries, is the largest company in North America
specializing in the delivery of new and used vehicles.
ALLIED HOLDINGS, INC. AND SUBSIDIARIES
2000 SECOND QUARTER EARNINGS RELEASE
(In Thousands, Except Per Share Data)
For the Three Months Ended
June 30
2000 1999
Revenues $295,897 $286,984
Net income $6,889 $4,132
Earnings per share-Basic and diluted $0.87 $0.53
Weighted average common shares outstanding
Basic 7,916 7,792
Diluted 7,916 7,800
For the Six Months Ended
June 30
2000 1999
Revenues $578,781 $548,233
Net income $5,854 $127
Earnings per share-Basic and diluted $0.74 $0.02
Weighted average common shares outstanding
Basic 7,901 7,791
Diluted 7,908 7,807
ALLIED HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands)
June 30 December 31
2000 1999
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $4,308 $13,984
Short-term investments 56,243 44,325
Receivables, net of allowance
for doubtful accounts 126,972 121,058
Inventories 7,880 7,949
Deferred tax assets 12,801 16,119
Prepayments and other current assets 25,218 22,182
Total current assets 233,422 225,617
PROPERTY AND EQUIPMENT, NET 267,174 287,838
OTHER ASSETS:
Goodwill, net 97,210 93,104
Other 44,495 43,361
Total other assets 141,705 136,465
Total assets $642,301 $649,920
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt $162 $185
Trade accounts payable 38,465 42,931
Accrued liabilities 93,539 85,655
Total current liabilities 132,166 128,771
LONG-TERM DEBT, less current maturities 323,029 330,101
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS 10,882 11,973
DEFERRED INCOME TAXES 33,516 37,409
OTHER LONG-TERM LIABILITIES 71,263 74,752
STOCKHOLDERS' EQUITY:
Common stock, no par value; 20,000 shares
authorized, 8,210 and 7,997 shares
outstanding at June 30, 2000 and
December 31,1999, respectively 0 0
Additional paid-in capital 45,267 44,437
Retained earnings 32,757 26,903
Cumulative other comprehensive
income, net of tax (6,111) (4,240)
Common stock in treasury, at cost, 62 and 29
shares at June 30, 2000 and December 31, 1999,
respectively (468) (186)
Total stockholders' equity 71,445 66,914
Total liabilities and
stockholders' equity $642,301 $649,920
ALLIED HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
(Unaudited)
For the For the
Three Months Ended Six Months Ended
June 30 June 30
2000 1999 2000 1999
REVENUES $295,897 $286,984 $578,781 $548,233
OPERATING EXPENSES:
Salaries, wages
and fringe benefits 154,275 150,128 309,113 294,773
Operating supplies
and expenses 48,302 49,701 99,884 94,482
Purchased
transportation 29,301 28,692 56,454 54,529
Insurance and claims 13,087 12,260 25,143 25,877
Operating taxes
and licenses 10,982 11,096 21,841 21,812
Depreciation and
amortization 15,393 14,362 30,635 28,377
Rents 2,173 2,301 4,499 4,368
Communications
and utilities 2,006 2,197 4,215 4,427
Other operating
expenses 3,091 2,770 5,749 4,926
Total operating
expenses 278,610 273,507 557,533 533,571
Operating income 17,287 13,477 21,248 14,662
OTHER INCOME (EXPENSE):
Equity in earnings of
joint ventures,
net of tax 1,798 871 2,699 97
Interest expense (8,348) (7,758) (16,749) (15,167)
Interest income 689 329 2,009 620
(5,861) (6,558) (12,041) (14,450)
INCOME BEFORE
INCOME TAXES 11,426 6,919 9,207 212
INCOME TAX PROVISION (4,537) (2,787) (3,353) (85)
NET INCOME $6,889 $4,132 $5,854 $127
PER COMMON SHARE -
BASIC AND DILUTED $0.87 $0.53 $0.74 $0.02
COMMON SHARES OUTSTANDING:
BASIC 7,916 7,792 7,901 7,791
DILUTED 7,916 7,800 7,908 7,807
ALLIED HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
For the Six Months Ended
June 30
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $5,854 $127
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization 30,635 28,377
Loss (gain) on sale of property and equipment 13 (24)
Deferred income taxes 838 (685)
Compensation expense related to
stock options and grants 408 292
Equity in earnings of joint ventures (2,699) (97)
Amortization of Teamsters Union signing bonus 1,238 0
Change in operating assets and liabilities:
Receivables, net of allowance
for doubtful accounts (4,289) (10,067)
Inventories 42 (1,406)
Prepayments and other current assets (3,117) (3,581)
Trade accounts payable (5,488) (9,980)
Accrued liabilities 3,631 (8,484)
Total adjustments 21,212 (5,655)
Net cash provided by (used in)
operating activities 27,066 (5,528)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (9,079) (26,482)
Proceeds from sale of property and equipment 112 827
Purchase of business, net of cash acquired (8,185) (1,879)
Investment in joint venture 0 (80)
(Increase) decrease in short-term investments ( 11,918) 388
(Increase) decrease in the cash surrender
value of life insurance (240) 73
Net cash used in investing activities (29,310) (27,153)
CASH FLOWS FROM FINANCING ACTIVITIES:
(Repayments) proceeds from issuance
of long-term debt, net (7,095) 34,383
Proceeds from issuance of common stock 422 0
Repurchase of common stock (282) 0
Proceeds from exercise of stock options 0 27
Other, net 164 941
Net cash (used in) provided
by financing activities (6,791) 35,351
EFFECT OF EXCHANGE RATE CHANGES ON CASH
AND CASH EQUIVALENTS (641) 177
NET (DECREASE) INCREASE IN CASH
AND CASH EQUIVALENTS (9,676) 2,847
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 13,984 21,977
CASH AND CASH EQUIVALENTS AT END OF PERIOD $4,308 $24,824
ALLIED HOLDINGS, INC. AND SUBSIDIARIES
2000 SECOND QUARTER EARNINGS RELEASE
OPERATING DATA
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
2000 1999 2000 1999
ALLIED HOLDINGS,
EXCLUDING
AAG - CANADA:
REVENUES $242,240,000 $237,431,000 $477,178,000 $455,345,000
OPERATING INCOME $9,772,000 $8,043,000 $10,852,000 $7,262,000
OPERATING RATIO 95.97% 96.61% 97.73% 98.41%
VEHICLES DELIVERED 2,426,215 2,613,090 4,938,865 5,069,030
LOADS DELIVERED 300,236 324,260 612,048 628,341
VEHICLES PER LOAD 8.08 8.06 8.07 8.07
REVENUE PER VEHICLE $99.84 $90.86 $96.62 $89.83
PERCENT DAMAGE
FREE DELIVERY 99.5% 99.5% 99.6% 99.5%
NUMBER OF
AVERAGE ACTIVE RIGS 4,051 4,377 4,096 4,356
AVERAGE EMPLOYEES
DRIVERS 4,957 4,908 5,100 4,793
OTHERS 2,319 2,489 2,401 2,357
ALLIED AUTOMOTIVE
GROUP - CANADA:
REVENUES $53,657,000 $49,553,000 $101,603,000 $92,888,000
OPERATING INCOME $7,515,000 $5,434,000 $10,396,000 $7,400,000
OPERATING RATIO 85.99% 89.03% 89.77% 92.03%
VEHICLES DELIVERED 772,001 711,869 1,460,101 1,341,305
LOADS DELIVERED 97,598 91,032 184,920 173,519
VEHICLES PER LOAD 7.91 7.82 7.90 7.73
REVENUE PER VEHICLE $69.50 $69.61 $69.59 $69.25
PERCENT DAMAGE
FREE DELIVERY 99.6% 99.6% 99.7% 99.6%
NUMBER OF
AVERAGE ACTIVE RIGS 816 856 824 860
AVERAGE EMPLOYEES
DRIVERS 1,227 1,205 1,247 1,160
OTHERS 565 576 569 577