United Road Services, Inc. Reports Third Quarter Results
16 November 2000
United Road Services, Inc. Reports Third Quarter Results
ALBANY, N.Y., Nov. 15 United Road Services, Inc.
(OTC Bulletin Board: URSI), a leading provider of national transport and
regional towing and recovery services, today reported third quarter 2000
revenues of $61.3 million and a net loss of $7.4 million, or $3.73 per diluted
common share. The net loss for the third quarter of 2000 includes non-
recurring charges of $3.9 million resulting from the Company's recent debt
refinancing and equity placement and a write-off of $1.9 million related to
the ability to realize its deferred tax asset. During the third quarter of
1999, the Company reported revenue of $64.2 million and a net loss of $3.7
million or $2.16 per diluted common share. The diluted earnings (loss) per
share calculations have been adjusted to reflect the 1 for 10 reverse stock
split effected as of May 4, 2000.
On July 20, 2000, the Company sold 662,119 shares of its Series A
Participating Convertible Preferred Stock to affiliates of KPS Special
Situations Fund, L.P. and General Electric Capital Corporation. Approximately
$2.1 million of expenses related to this transaction, which constituted a
change in control of the Company, are reflected in the third quarter results.
Excluding the effect of these expenses, EBITDA for the third quarter of 2000
was $5.3 million. The equity transaction also resulted in an Internal Revenue
Code Section 382 ownership change. Therefore, in determining the ability to
realize its deferred tax assets during the third quarter, the Company wrote
off a benefit of $1.9 million associated with net operating loss carry
forwards. During the third quarter of 1999, the Company reported EBITDA
excluding special charges of $3.5 million. During the second quarter of 2000,
the Company reported EBITDA excluding non-cash charges of $4.0 million.
Gerald Riordan, Chief Executive Officer of the Company commented, "In July
2000, the Company issued equity securities and refinanced its credit facility
with a new group of lenders which has assisted in our continuing efforts to
move forward with our turnaround initiatives. With our revenue base,
investment in new equipment, closure of certain unprofitable divisions and
profitability improvement initiatives, we continue our efforts to return to
profitability and establish a foundation for the Company's future success."
United Road Services, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except share amounts)
ASSETS September 30, December 31,
Current assets: (Unaudited)
Cash and cash equivalents $3,079 4,115
Trade receivables, net of allowance for doubtful
accounts of $1,997 at September 30, 2000
and $2,539 at December 31, 1999 20,777 23,709
Other receivables, net of allowance
for doubtful accounts of $155 at
September 30, 2000 and $262 at
December 31, 1999 1,528 1,161
Prepaid income taxes 1,543 3,534
Prepaid expenses and other current assets 2,088 2,274
Current portion of rights to
equipment under finance contracts 239 435
Total current assets 29,254 35,228
Vehicles and equipment, net 69,686 78,212
Rights to equipment under finance
contracts, excluding current portion 342 1,480
Deferred financing costs, net 5,726 4,109
Goodwill, net 78,042 203,337
Other non-current assets 257 79
Total assets $183,307 322,445
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current installments of obligations
under capital leases $203 268
Current installments of obligations
for equipment under finance contracts 239 435
Borrowings under credit facility 27,632 50,650
Accounts payable 6,677 7,464
Accrued expenses 10,022 9,489
Due to related parties -- 1,130
Total current liabilities 44,773 69,436
Obligations under capital leases,
excluding current installments 247 402
Obligations for equipment under finance
contracts, excluding
current installments 342 1,480
Long-term debt 85,851 80,876
Deferred tax liability 9,878 2,666
Other long-term liabilities 1,027 1,172
Total liabilities 142,118 156,032
Stockholders' equity:
Preferred stock; $ 0.001 par value 5,000,000
shares authorized;
662,119 shares issued or outstanding 1 --
Common stock, $0.01 par value; 35,000,000 shares
authorized; 2,093,707 and 1,759,416
shares issued and outstanding at
September 30, 2000 and
December 31, 1999, respectively 21 18
Additional paid-in capital 217,710 191,877
Accumulated deficit (176,543) (25,482)
Total stockholders' equity 41,189 166,413
Total liabilities and stockholders' equity $183,307 322,445
United Road Services, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
2000 1999 2000 1999
Net revenue $61,346 64,150 189,526 189,085
Cost of revenue,
excluding
depreciation 48,796 50,207 150,730 140,191
Amortization of goodwill 740 1,472 3,419 4,266
Depreciation 2,489 2,579 7,526 6,543
Selling, general and
administrative
expenses 11,310 11,535 30,069 29,843
Impairment charge -- -- 129,455 --
Income (loss) from
operations (1,989) (1,643) (131,673) 8,242
Other income (expense):
Interest income 93 3 262 12
Interest expense (4,669) (3,353) (11,342) (7,984)
Other (47) (7) (421) (137)
Income (loss) before
income taxes (6,612) (5,000) (143,174) 133
Income tax (benefit)
expense 813 (1,313) 7,598 1,340
Net loss $(7,425) (3,687) (150,772) (1,207)
Per share amounts:
Basic earnings(loss) $(3.73) (2.16) (80.73) (.71)
Diluted earnings(loss) (3.73) (2.16) (80.73) (.71)