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USA Truck Reports Third Quarter 2019 Results

USA Truck Reports Third Quarter 2019 Results

  • 3Q 2019 loss per diluted share of ($0.16) versus 3Q 2018 earnings per diluted share of $0.40
  • 3Q 2019 adjusted loss per diluted share(a) of ($0.13) when adjusted for acquisition related intangible amortization versus 3Q 2018 adjusted earnings per diluted share(a) of $0.43
  • 3Q 2019 Trucking operating revenue increased 7.8% to $93.6 million from $86.8 million in 3Q 2018

Category:

Thursday, October 31, 2019 3:05 pm CDT

Dateline:

VAN BUREN, Ark.

Public Company Information:

NASDAQ:
USAK

VAN BUREN, Ark.--(BUSINESS WIRE)--USA Truck Inc. (NASDAQ: USAK), a leading capacity solutions provider, today announced its financial results for the three and nine months ended September 30, 2019.

For the quarter ended September 30, 2019, consolidated operating revenue was $130.9 million compared to $132.6 million for the prior-year period. Base revenue, which excludes fuel surcharge revenue, was $114.9 million compared to $116.6 million for the 2018 period. The Company reported a net loss of ($1.4) million, or ($0.16) per diluted share for the third quarter 2019 and adjusted net loss(a) of ($1.1) million, or ($0.13) per diluted share, compared to net income of $3.3 million, or $0.40 per diluted share and adjusted net income(a) of $3.6 million, or $0.43 per diluted share for the same quarter in 2018. The Company's third quarter 2019 consolidated operating ratio was 100.0%, compared to 95.6% in the comparable 2018 quarter. The results for the three and nine months ended September 30, 2019 include Davis Transfer Company, acquired in October 2018.

President and CEO James Reed commented, "The third quarter marked a continuation of the challenging freight environment the industry has experienced in 2019. A seasonally soft market, coupled with increased trucking capacity in the market has created an environment where shippers are motivated to allocate a larger portion of their freight to the spot market and low priced carrier options. This environment continues to adversely impact results in both our Trucking and USAT Logistics segments.

We have instituted measures aimed at stabilizing our operational and financial performance for the remainder of 2019 and to set the stage for further improvements in 2020. These measures include:

  • Eliminate 5-10% of fixed costs across all departments. We have implemented approximately $5.6 million in annualized cost savings in 2019, with additional areas under review.
  • Increase actualization of bid awards. We have implemented bid award tracking procedures to more closely monitor customer commitments at the lane level. This has enabled us to identify customer-specific opportunities and impact freight realization.
  • Expand our terminal footprint to enhance alignment with our improving network. The goal of this terminal expansion is to drive further reductions in outside repair costs throughout our network, in addition to offering more accessible amenities to our drivers. We recently entered into a lease agreement to open a terminal in Carlisle, PA that will provide tractor and trailer repairs, as well as provide driver amenities. We have also opened maintenance facilities in South Holland, IL and Atlanta, GA, and are making improvements to driver amenities in several other terminals across the network.
  • Add salesforce in USAT Logistics to increase volume. We added 11 personnel to the logistics salesforce to broaden our sales pipeline and extend our customer reach at a time when freight volumes are critical.

We continue to implement the tenets of our long-term strategy outlined at our Investor Day Conference in May of this year: increasing revenue per truck, utilization improvement, cost control, unpaid mile reduction, and increasing the USAT Logistics share of our overall revenue. We remain vigilant in making the necessary structural changes required to realize the Company’s long-term strategy outlined in that meeting, and are making progress in closing the gap to our key competitors. Despite our challenges, we continue to be energized by the responsiveness of our team. They battle the myriad of challenges presented in the current freight environment every day and we strongly believe our quest for change will continue to transform USA Truck into a world-class service provider.”

Trucking: For the third quarter of 2019, Trucking operating revenue (before intersegment eliminations) increased $6.8 million, or 7.8%, to $93.6 million, compared to the third quarter of 2018. Trucking operating loss of ($0.3) million the 2019 period, reflected an operating ratio of 100.3%, compared to operating income of $2.6 million and an operating ratio of 97.0% for the third quarter of 2018. This represents a decrease of $2.9 million year over year in operating income and a 330 basis point decline in operating ratio. Adjusted operating income(a) was $0.1 million for the 2019 period, reflecting an adjusted operating ratio(a) of 99.9%, compared to an adjusted operating income(a) of $2.6 million and an adjusted operating ratio(a) of 96.5% for the comparable 2018 period. This represents a decrease of $2.5 million year over year in adjusted operating income(a) and a 340 basis point decline in adjusted operating ratio(a).

Trucking operations delivered the following results during the third quarter:

  • Base revenue per available tractor per week decreased $273 per week, or 8.0%, compared to the third quarter of 2018, and decreased $208 per week, or 6.2% sequentially, primarily due to lower volumes on committed lanes coupled with spot market pricing pressure.
  • Base revenue per loaded mile decreased $0.140, or 6.3% year over year, and $0.043, or 2.0%, sequentially. This change was the result of increased pressure in the year over year spot market which was partially offset by network realignment into the third quarter of 2019. Trucking continued to secure additional freight volume from the spot market, which negatively impacted base revenue per mile.
  • Loaded miles per available tractor per week decreased 28 miles, or 1.8%, compared to the third quarter of 2018, and sequentially by 67 miles per tractor, or 4.3%.
  • Deadhead percentage for third quarter 2019 improved 30 basis points year over year, but degraded 80 basis points sequentially.
  • The average seated tractor count for the third quarter of 2019 was 1,862, which represented a 21.4% increase compared to our third quarter 2018 average of 1,534, and a 45 tractor increase sequentially over the second quarter 2019 average of 1,817. Average unseated tractor percentage for third quarter 2019 was 6.5%, unchanged when compared to the third quarter of 2018 and up from 5.2% at the second quarter of 2019.

USAT Logistics: Operating revenue (before intersegment eliminations) was $39.4 million for the third quarter of 2019, a decrease of $9.8 million, or 19.9% year over year. Both operating income and adjusted operating income(a) were $0.2 million for the 2019 period, reflecting an operating ratio of 99.4% and an adjusted operating ratio of 99.3%, compared to operating income and adjusted operating income(a) of $3.2 million and an operating ratio of 93.5% and an adjusted operating ratio(a) of 92.9% for the comparable 2018 period. This change represented a decrease of $3.0 million year over year in operating income and adjusted operating income(a) and 590 basis points in operating ratio and 640 basis points in adjusted operating ratio(a) compared to the third quarter of 2018.

USAT Logistics operations delivered the following results during the third quarter 2019:

  • Gross margin dollars decreased 42.2%, or $3.5 million year over year, to $4.8 million for the third quarter 2019, and decreased 26.2%, or $1.7 million, sequentially.
  • Gross margin percentage for the third quarter of 2019 decreased to 12.2% from 17.0% when compared to the same quarter in 2018, and decreased 430 basis points sequentially from 16.5% for the second quarter of 2019.
  • Revenue per load decreased 25.8%, or $443 per load year over year, and 7.1%, or $98 per load, over the second quarter of 2019.
  • Load count increased 8.0%, or 2,287 loads year over year, and increased 7.1%, or 2,059 loads, over second quarter of 2019.

Segment Results

The following table includes key operating results and statistics by reportable segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

 

Trucking:

 

 

 

 

 

 

 

 

 

 

 

 

Operating revenue (before intersegment eliminations) (in thousands)

$

93,587

 

 

$

86,801

 

 

$

284,965

 

 

$

251,332

 

 

Operating (loss) income (1) (in thousands)

$

(278

)

 

$

2,605

 

 

$

2,168

 

 

$

4,294

 

 

Adjusted operating income (2) (in thousands)

$

62

 

 

$

2,605

 

$

3,530

 

$

4,191

 

Operating ratio (3)

 

100.3

%

 

97.0

%

 

99.2

%

 

98.3

%

Adjusted operating ratio (4)

 

99.9

%

 

96.5

%

 

98.6

%

 

98.0

%

Total miles (5) (in thousands)

 

44,850

 

 

 

38,171

 

 

 

132,297

 

 

 

116,274

 

 

Deadhead percentage (6)

 

13.5

%

 

13.8

%

 

13.2

%

 

13.3

%

Base revenue per loaded mile

$

2.097

 

 

$

2.237

 

 

$

2.159

 

 

$

2.130

 

 

Average number of seated tractors

 

1,862

 

 

 

1,534

 

 

 

1,815

 

 

 

1,542

 

 

Average number of available tractors (7)

 

1,991

 

 

 

1,641

 

 

 

1,941

 

 

 

1,633

 

 

Average number of in-service tractors (8)

 

2,020

 

 

 

1,672

 

 

 

1,973

 

 

 

1,664

 

 

Loaded miles per available tractor per week

 

1,498

 

 

 

1,526

 

 

 

1,517

 

 

 

1,583

 

 

Base revenue per available tractor per week

$

3,142

 

 

$

3,415

 

 

$

3,275

 

 

$

3,370

 

 

Average loaded miles per trip

 

488

 

 

 

516

 

 

 

491

 

 

 

526

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

USAT Logistics:

 

 

 

 

 

 

 

 

 

 

 

 

Operating revenue (before intersegment eliminations) (in thousands)

$

39,365

 

 

$

49,136

 

 

$

120,390

 

 

$

146,527

 

 

Operating income (1) (in thousands)

$

244

 

 

$

3,198

 

 

$

3,702

 

 

$

8,212

 

 

Adjusted operating income (2) (in thousands)

$

244

 

 

$

3,198

 

 

$

3,702

 

 

$

8,387

 

 

Gross margin (9) (in thousands)

$

4,822

 

 

$

8,338

 

 

$

19,041

 

 

$

23,735

 

 

Gross margin percentage (10)

 

12.2

%

 

17.0

%

 

15.8

%

 

16.2

%

Load count (in thousands)

 

30.9

 

 

 

28.6

 

 

 

87.4

 

 

 

85.2

 

 

1.

Operating income (loss) is calculated by deducting operating expenses (before intersegment eliminations) from operating revenue (before intersegment eliminations).

2.

Adjusted operating income(a) is calculated by deducting operating expenses (before intersegment eliminations) excluding restructuring, impairment and other costs, severance costs included in salaries, wages and employee benefits, amortization of acquisition related intangibles and transaction costs related to acquisition, net of fuel surcharge revenue from operating revenue (before intersegment eliminations), net of fuel surcharge revenue.

3.

Operating ratio is calculated as operating expenses (before intersegment eliminations) as a percentage of operating revenue (before intersegment eliminations).

4.

Adjusted operating ratio(a) is calculated as operating expenses (before intersegment eliminations) excluding severance costs included in salaries, wages and employee benefits, restructuring, impairment and other costs, amortization of acquisition related intangibles, and transaction costs related to acquisition, net of fuel surcharge revenue, as a percentage of operating revenue (before intersegment eliminations) excluding fuel surcharge revenue.

5.

Total miles include both loaded and empty miles.

6.

Deadhead percentage is calculated by dividing empty miles by total miles.

7.

Available tractors are a) all Company tractors that are available to be dispatched, including available unseated tractors, and b) all tractors in the independent contractor fleet.

8.

In-service tractors include all of the tractors in the Company fleet (Company-operated tractors) and all the tractors in the independent contractor fleet.

9.

Gross margin is calculated by deducting USAT Logistics purchased transportation expense from USAT Logistics operating revenue (before intersegment eliminations).

10.

Gross margin percentage is calculated as gross margin divided by USAT Logistics operating revenue (before intersegment eliminations).

Balance Sheet and Liquidity

As of September 30, 2019, total debt and lease liabilities was $188.9 million, total debt and lease liabilities, net of cash (“Net Debt”)(a), was $188.7 million and total stockholders' equity was $82.5 million. Net Debt to Adjusted EBITDAR(a) for the trailing twelve months ended September 30, 2019 was 3.1x. The Company had approximately $54.7 million available to borrow under its Credit Facility as of September 30, 2019.

Third Quarter 2019 Conference Call Information

USA Truck will hold a conference call to discuss its third quarter 2019 results on Friday, November 1, 2019 at 8:00 AM CT / 9:00 AM ET. To participate in the call, please dial 1-844-824-3828 (U.S./Canada) or 1-412-317-5138 (International). A live webcast of the conference call will be broadcast in the Investor Relations section of the Company's website www.usa-truck.com, under the "Events & Presentations" tab of the "Investor Relations" menu. For those who cannot listen to the live broadcast, the presentation materials and an audio replay of the call will be available at our website, www.usa-truck.com, under the "Events & Presentations" tab of the "Investor Relations" menu, or may be accessed using the following link: https://services.choruscall.com/links/usak191101.html. A telephone replay of the call will also be available through November 8, 2019, and may be accessed by calling 1-877-344-7529 (U.S.), 1-855-669-9658 (Canada), or 1-412-317-0088 (International) and by referencing conference ID #10134574.

(a) About Non-GAAP Financial Information

In addition to our GAAP results, this press release also includes certain non-GAAP financial measures, as defined by the SEC. The terms "Base Revenue", "Net Debt", "EBITDAR", "Adjusted EBITDAR", "Adjusted operating ratio", "Adjusted operating income (loss)", "Adjusted net income (loss)", and "Adjusted earnings (loss) per diluted share", as we define them, are not presented in accordance with GAAP.

The Company defines Base Revenue as operating revenue less fuel surcharge revenue and intercompany eliminations. The Company defines Net Debt as total debt, including insurance premium financing and lease liabilities, net of cash. The Company defines EBITDAR as net income (loss), plus interest expense net of interest income, provision for income tax expense (benefit), depreciation and amortization, and equipment rent. The Company defines Adjusted EBITDAR as EBITDAR plus non-cash equity compensation, severance costs included in salaries, wages and employee benefits, transaction costs related to acquisition, and impairment of assets held for sale. Adjusted operating ratio is calculated as operating expenses excluding severance costs included in salaries, wages and employee benefits, restructuring, impairment and other costs, and amortization of acquisition related intangibles, net of fuel surcharge revenue, as a percentage of operating revenue, excluding fuel surcharge revenue. Adjusted operating income (loss) is defined as operating income (loss) excluding severance costs included in salaries, wages and employee benefits, restructuring, impairment and other costs, and amortization of acquisition related intangibles. Adjusted net income (loss) is defined as net income (loss) excluding severance costs included in salaries, wages and employee benefits, restructuring, impairment and other costs, amortization of acquisition related intangibles, and transaction costs related to acquisition plus or minus the income tax effect of such adjustments using a statutory tax rate. Adjusted earnings (loss) per diluted share is defined as Adjusted net income (loss) divided by the weighted average number of diluted shares outstanding during the period. The per-share impact of each item is determined by dividing it by the weighted average diluted shares outstanding. These financial measures supplement our GAAP results in evaluating certain aspects of our business. We believe that using these measures improves comparability in analyzing our performance because they remove the impact of items from our operating results that, in our opinion, do not reflect our core operating performance. Management and the board of directors focus on Base Revenue, Net Debt, EBITDAR, Adjusted EBITDAR, Adjusted operating ratio, Adjusted operating income (loss), Adjusted net income (loss), and Adjusted earnings (loss) per diluted share as key measures of our performance and liquidity, all of which are reconciled to the most comparable GAAP financial measures and further discussed below. We believe our presentation of these non-GAAP financial measures is useful to investors and other users because it provides them the same information that we use internally for purposes of assessing our core operating performance.

Base Revenue, Net Debt, EBITDAR, Adjusted EBITDAR, Adjusted operating ratio, Adjusted operating income (loss), Adjusted net income (loss), and Adjusted earnings (loss) per diluted share are not substitutes for their comparable GAAP financial measures, such as total debt, net income, cash flows from operating activities, operating ratio, diluted earnings per share, or other measures prescribed by GAAP. There are limitations to using non-GAAP financial measures. Although we believe that they improve comparability in analyzing our period to period performance, they could limit comparability to other companies in our industry if those companies define these measures differently. Because of these limitations, our non-GAAP financial measures should not be considered measures of income generated by our business or discretionary cash available to us to invest in the growth of our business. Management compensates for these limitations by primarily relying on GAAP results and using non-GAAP financial measures on a supplemental basis.

Pursuant to the requirements of Regulation G and Regulation S-K, we have provided reconciliations of Base Revenue, Net Debt, EBITDAR, Adjusted EBITDAR, Adjusted operating ratio, Adjusted operating income (loss), Adjusted net income (loss), and Adjusted earnings (loss) per diluted share to the most comparable GAAP financial measures at the end of this press release.

Cautionary Statement Concerning Forward-Looking Statements

Financial information in this press release is preliminary and based upon information available to the Company as of the date of this press release. As such, this information remains subject to the completion of our quarterly review procedures, and the filing of the related Quarterly Report on Form 10-Q, which could result in changes, some of which could be material, to the preliminary information provided in this press release.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. These statements generally may be identified by their use of terms or phrases such as "seek," "expects," "estimates," "anticipates," "projects," "believes," "hopes," "plans," "goals," "intends," "may," "might," "likely," "will," "should," "would," "could," "potential," "predict," "continue," "strategy," "future" and terms or phrases of similar substance. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Accordingly, actual results may differ materially from those set forth in the forward-looking statements. Readers should review and consider the factors that may affect future results and other disclosures by the Company in its press releases, Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information, except as required by law. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this press release might not occur. All forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by this cautionary statement.

References to the "Company," "we," "us," "our" and words of similar expression refer to USA Truck, Inc. and its subsidiaries.

About USA Truck

USA Truck provides comprehensive capacity solutions to a broad and diverse customer base throughout North America. Our Trucking and USAT Logistics divisions blend an extensive portfolio of asset and asset-light services, offering a balanced approach for our customers supply chain management, including customized truckload, dedicated contract carriage, intermodal and third-party logistics freight management services. For more information, visit usa-truck.com or usatlogistics.com.

This press release and related information will be available to interested parties at our investor relations website, http://investor.usa-truck.com.

 

USA TRUCK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME

(UNAUDITED)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

(in thousands, except per share data)

Operating revenue

 

$

130,924

 

 

$

132,583

 

 

$

398,520

 

 

$

392,977

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Salaries, wages and employee benefits

 

 

32,846

 

 

 

31,540

 

 

 

102,742

 

 

 

95,423

 

Fuel and fuel taxes

 

 

13,842

 

 

 

13,823

 

 

 

41,575

 

 

 

41,286

 

Depreciation and amortization

 

 

9,652

 

 

 

6,735

 

 

 

27,595

 

 

 

21,392

 

Insurance and claims

 

 

6,499

 

 

 

5,946

 

 

 

20,939

 

 

 

16,889

 

Equipment rent

 

 

2,427

 

 

 

2,916

 

 

 

7,715

 

 

 

7,785

 

Operations and maintenance

 

 

8,829

 

 

 

8,237

 

 

 

24,583

 

 

 

25,111

 

Purchased transportation

 

 

51,281

 

 

 

52,640

 

 

 

148,634

 

 

 

157,495

 

Operating taxes and licenses

 

 

1,218

 

 

 

1,136

 

 

 

3,646

 

 

 

2,900

 

Communications and utilities

 

 

967

 

 

 

674

 

 

 

2,453

 

 

 

2,064

 

Gain on disposal of assets, net

 

 

(696

)

 

 

(901

)

 

 

(700

)

 

 

(1,466

)

Impairment of assets held for sale

 

 

1

 

 

 

 

 

 

368

 

 

 

 

Reversal of restructuring, impairment and other costs

 

 

 

 

 

 

 

 

 

 

 

(639

)

Other

 

 

4,092

 

 

 

4,034

 

 

 

13,100

 

 

 

12,231

 

Total operating expenses

 

$

130,958

 

 

$

126,780

 

 

$

392,650

 

 

$

380,471

 

Operating (loss) income

 

 

(34

)

 

 

5,803

 

 

 

5,870

 

 

 

12,506

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

1,615

 

 

 

811

 

 

 

4,951

 

 

 

2,462

 

Other, net

 

 

145

 

 

 

420

 

 

 

453

 

 

 

653

 

Total other expenses, net

 

 

1,760

 

 

 

1,231

 

 

 

5,404

 

 

 

3,115

 

(Loss) income before income taxes

 

 

(1,794

)

 

 

4,572

 

 

 

466

 

 

 

9,391

 

Income tax (benefit) expense

 

 

(421

)

 

 

1,272

 

 

 

337

 

 

 

2,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated net (loss) income and comprehensive (loss) income

 

$

(1,373

)

 

$

3,300

 

 

$

129

 

 

$

6,879

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Average shares outstanding (basic)

 

 

8,564

 

 

 

8,223

 

 

 

8,509

 

 

 

8,170

 

Basic (loss) earnings per share

 

$

(0.16

)

 

$

0.40

 

 

$

0.02

 

 

$

0.84

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average shares outstanding (diluted)

 

 

8,564

 

 

 

8,240

 

 

 

8,522

 

 

 

8,193

 

Diluted (loss) earnings per share

 

$

(0.16

)

 

$

0.40

 

 

$

0.02

 

 

$

0.84

 

GAAP TO NON-GAAP RECONCILIATIONS(a)

(UNAUDITED)

ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION, RENT(a)

 

 

 

Three Months Ended

 

 

9/30/2019

 

6/30/2019

 

3/31/2019

 

12/31/2018

 

 

(in thousands)

Net (loss) income

 

$

(1,373

)

 

$

1

 

$

1,501

 

$

5,325

Add:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

9,652

 

 

 

9,125

 

 

8,818

 

 

6,932

Equipment rent

 

 

2,427

 

 

 

2,568

 

 

2,720

 

 

3,055

Interest expense, net

 

 

1,615

 

 

 

1,595

 

 

1,741

 

 

1,187

Income tax (benefit) expense

 

 

(421

)

 

 

216

 

 

542

 

 

1,862

EBITDAR(a)

 

 

11,900

 

 

 

13,505

 

 

15,322

 

 

18,361

Add:

 

 

 

 

 

 

 

 

 

 

 

 

Non-cash equity compensation

 

 

(107

)

 

 

705

 

 

589

 

 

559

Severance costs included in salaries, wages and employee benefits

 

 

 

 

 

 

 

319

 

 

Transaction costs relating to acquisition

 

 

 

 

 

 

 

 

 

239

Impairment of assets held for sale

 

 

1

 

 

 

367

 

 

 

 

Adjusted EBITDAR(a)

 

$

11,794

 

 

$

14,577

 

$

16,230

 

$

19,159

ADJUSTED NET (LOSS) INCOME RECONCILIATION(a)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

(in thousands)

Net (loss) income

 

$

(1,373

)

 

$

3,300

 

 

$

129

 

 

$

6,879

 

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

Severance costs included in salaries, wages, and employee benefits

 

 

 

 

 

 

 

 

319

 

 

 

711

 

Reversal of restructuring, impairment and other costs

 

 

 

 

 

 

 

 

 

 

 

(639

)

Amortization of acquisition related intangibles

 

 

340

 

 

 

 

 

 

1,043

 

 

 

 

Transaction costs related to acquisition

 

 

 

 

 

325

 

 

 

 

 

 

325

 

Income tax effect of adjustments

 

 

(87

)

 

 

(69

)

 

 

(347

)

 

 

(83

)

Adjusted net (loss) income(a)

 

$

(1,120

)

 

$

3,556

 

 

$

1,144

 

 

$

7,193

 

ADJUSTED (LOSS) EARNINGS PER DILUTED SHARE RECONCILIATION(a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

 

(Loss) earnings per diluted share

 

$

(0.16

)

 

$

0.40

 

 

$

0.02

 

 

 

0.84

 

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

Severance costs included in salaries, wages and employee benefits

 

 

 

 

 

 

 

 

0.04

 

 

 

0.09

 

Reversal of restructuring, impairment and other costs

 

 

 

 

 

 

 

 

 

 

 

(0.08

)

Amortization of acquisition related intangibles

 

 

0.04

 

 

 

 

 

 

0.12

 

 

 

 

Transaction costs related to acquisition

 

 

 

 

 

0.04

 

 

 

 

 

 

0.04

 

Income tax effect of adjustments

 

 

(0.01

)

 

 

(0.01

)

 

 

(0.04

)

 

 

(0.01

)

Adjusted (loss) earnings per diluted share(a)

 

$

(0.13

)

 

$

0.43

 

 

$

0.14

 

 

$

0.88

 

NET DEBT RECONCILIATION(a)

 

 

 

 

 

 

 

 

 

September 30, 2019

 

December 31, 2018

 

 

(in thousands)

Total current debt and lease liabilities

 

$

28,672

 

 

$

21,727

 

Long-term debt, less current maturities

 

 

87,093

 

 

 

85,300

 

Leases, less current maturities

 

 

73,178

 

 

 

53,460

 

Total Debt

 

 

188,943

 

 

 

160,487

 

Less: Cash

 

 

(284

)

 

 

(989

)

Net Debt(a)

 

$

188,659

 

 

$

159,498

 

ADJUSTED OPERATING RATIO RECONCILIATION(a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

Consolidated

 

2019

 

2018

 

2019

 

2018

 

 

 

(in thousands)

 

Operating revenue

 

$

130,924

 

 

$

132,583

 

 

$

398,520

 

 

$

392,977

 

 

Less: fuel surcharge revenue

 

 

(16,015

)

 

 

(15,982

)

 

 

(48,357

)

 

 

(46,990

)

 

Base revenue

 

$

114,909

 

 

$

116,601

 

 

$

350,163

 

 

$

345,987

 

 

Operating expense

 

$

130,958

 

 

$

126,780

 

 

$

392,650

 

 

$

380,471

 

 

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

Severance costs included in salaries, wages, and employee benefits

 

 

 

 

 

 

 

 

(319

)

 

 

(711

)

 

Reversal of restructuring, impairment and other costs

 

 

 

 

 

 

 

 

 

 

 

639

 

 

Amortization of acquisition related intangibles

 

 

(340

)

 

 

 

 

 

(1,043

)

 

 

 

 

Fuel surcharge revenue

 

 

(16,015

)

 

 

(15,982

)

 

 

(48,357

)

 

 

(46,990

)

 

Adjusted operating expense

 

$

114,603

 

 

$

110,798

 

 

$

342,931

 

 

$

333,409

 

 

Operating (loss) income

 

$

(34

)

 

$

5,803

 

 

$

5,870

 

 

$

12,506

 

 

Adjusted operating income(a)

 

$

306

 

 

$

5,803

 

 

$

7,232

 

 

$

12,578

 

 

Operating ratio

 

 

100.0

%

 

95.6

%

 

98.5

%

 

96.8

%

Adjusted operating ratio(a)

 

 

99.7

%

 

95.0

%

 

97.9

%

 

96.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

Trucking Segment

 

2019

 

2018

 

2019

 

2018

 

 

 

(in thousands)

 

Operating revenue

 

$

93,354

 

 

$

85,529

 

 

$

283,963

 

 

$

249,831

 

 

Intersegment activity

 

 

233

 

 

 

1,272

 

 

 

1,002

 

 

 

1,501

 

 

Operating revenue (before intersegment eliminations)

 

 

93,587

 

 

 

86,801

 

 

 

284,965

 

 

 

251,332

 

 

Less: fuel surcharge revenue

 

 

(12,274

)

 

 

(12,002

)

 

 

(37,073

)

 

 

(35,324

)

 

Base revenue

 

$

81,313

 

 

$

74,799

 

 

$

247,892

 

 

$

216,008

 

 

Operating expense (before intersegment eliminations)

 

$

93,865

 

 

$

84,196

 

 

$

282,797

 

 

$

247,038

 

 

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

Severance costs included in salaries, wages, and employee benefits

 

 

 

 

 

 

 

 

(319

)

 

 

(484

)

 

Reversal of restructuring, impairment and other costs

 

 

 

 

 

 

 

 

 

 

 

587

 

 

Amortization of acquisition related intangibles

 

 

(340

)

 

 

 

 

 

(1,043

)

 

 

 

 

Fuel surcharge revenue

 

 

(12,274

)

 

 

(12,002

)

 

 

(37,073

)

 

 

(35,324

)

 

Adjusted operating expense

 

$

81,251

 

 

$

72,194

 

 

$

244,362

 

 

$

211,817

 

 

Operating (loss) income

 

$

(278

)

 

$

2,605

 

 

$

2,168

 

 

$

4,294

 

 

Adjusted operating income(a)

 

$

62

 

 

$

2,605

 

 

$

3,530

 

 

$

4,191

 

 

Operating ratio

 

 

100.3

%

 

97.0

%

 

99.2

%

 

98.3

%

Adjusted operating ratio(a)

 

 

99.9

%

 

96.5

%

 

98.6

%

 

98.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

USAT Logistics Segment

 

2019

 

2018

 

2019

 

2018

 

 

 

(in thousands)

 

Operating revenue

 

$

37,570

 

 

$

47,054

 

 

$

114,557

 

 

$

143,146

 

 

Intersegment activity

 

 

1,795

 

 

 

2,082

 

 

 

5,833

 

 

 

3,381

 

 

Operating revenue (before intersegment eliminations)

 

 

39,365

 

 

 

49,136

 

 

 

120,390

 

 

 

146,527

 

 

Less: fuel surcharge revenue

 

 

(3,991

)

 

 

(4,283

)

 

 

(11,920

)

 

 

(12,086

)

 

Base revenue

 

$

35,374

 

 

$

44,853

 

 

$

108,470

 

 

$

134,441

 

 

Operating expense (before intersegment eliminations)

 

$

39,121

 

 

$

45,938

 

 

$

116,688

 

 

$

138,315

 

 

Adjusted for:

 

 

 

 

 

 

 

 

 

 

 

 

 

Severance costs included in salaries, wages, and employee benefits

 

 

 

 

 

 

 

 

 

 

 

(227

)

 

Reversal of restructuring, impairment and other costs

 

 

 

 

 

 

 

 

 

 

 

52

 

 

Fuel surcharge revenue

 

 

(3,991

)

 

 

(4,283

)

 

 

(11,920

)

 

 

(12,086

)

 

Adjusted operating expense

 

$

35,130

 

 

$

41,655

 

 

$

104,768

 

 

$

126,054

 

 

Operating income

 

$

244

 

 

$

3,198

 

 

$

3,702

 

 

$

8,212

 

 

Adjusted operating income(a)

 

$

244

 

 

$

3,198

 

 

$

3,702

 

 

$

8,387

 

 

Operating ratio

 

 

99.4

%

 

93.5

%

 

96.9

%

 

94.4

%

Adjusted operating ratio(a)

 

 

99.3

%

 

92.9

%

 

96.6

%

 

93.8

%

 

USA TRUCK INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

 

 

 

 

 

 

 

 

September 30, 2019

 

December 31, 2018

 

 

(in thousands, except share data)

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash

 

$

284

 

 

$

989

 

Accounts receivable, net of allowance for doubtful accounts of $367 and $575, respectively

 

 

55,078

 

 

 

57,189

 

Other receivables

 

 

6,874

 

 

 

5,688

 

Inventories

 

 

718

 

 

 

722

 

Assets held for sale

 

 

4,357

 

 

 

2,611

 

Prepaid expenses and other current assets

 

 

4,816

 

 

 

7,675

 

Total current assets

 

 

72,127

 

 

 

74,874

 

Property and equipment:

 

 

 

 

 

 

Land and structures

 

 

32,818

 

 

 

32,434

 

Revenue equipment

 

 

295,790

 

 

 

280,623

 

Service, office and other equipment

 

 

30,130

 

 

 

28,094

 

Property and equipment, at cost

 

 

358,738

 

 

 

341,151

 

Accumulated depreciation and amortization

 

 

(116,698

)

 

 

(115,766

)

Property and equipment, net

 

 

242,040

 

 

 

225,385

 

Operating leases - right of use assets

 

 

12,077

 

 

 

 

Goodwill

 

 

5,231

 

 

 

4,926

 

Other intangibles, net

 

 

16,793

 

 

 

17,837

 

Other assets

 

 

1,662

 

 

 

1,003

 

Total assets

 

$

349,930

 

 

$

324,025

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

 

23,759

 

 

 

23,482

 

Current portion of insurance and claims accruals

 

 

13,512

 

 

 

15,852

 

Accrued expenses

 

 

7,313

 

 

 

9,366

 

Current finance lease obligations

 

 

19,469

 

 

 

17,292

 

Current operating lease obligations

 

 

7,556

 

 

 

 

Long-term debt, current maturities

 

 

1,647

 

 

 

 

Insurance premium financing

 

 

 

 

 

4,435

 

Total current liabilities

 

 

73,256

 

 

 

70,427

 

Deferred gain

 

 

119

 

 

 

84

 

Long-term debt, less current maturities

 

 

87,093

 

 

 

85,300

 

Long-term finance lease obligations

 

 

68,610

 

 

 

53,460

 

Long-term operating lease obligations

 

 

4,568

 

 

 

 

Deferred income taxes

 

 

23,564

 

 

 

23,518

 

Insurance and claims accruals, less current portion

 

 

10,209

 

 

 

9,963

 

Total liabilities

 

 

267,419

 

 

 

242,752

 

Stockholders' equity:

 

 

 

 

 

 

Preferred Stock, $0.01 par value; 1,000,000 shares authorized; none issued

 

 

 

 

 

 

Common Stock, $0.01 par value; 30,000,000 shares authorized; issued 11,988,480 shares, and 12,011,495 shares, respectively

 

 

120

 

 

 

120

 

Additional paid-in capital

 

 

62,585

 

 

 

66,433

 

Retained earnings

 

 

78,596

 

 

 

78,467

 

Less treasury stock, at cost (3,415,662 shares, and 3,650,060 shares, respectively)

 

 

(58,790

)

 

 

(63,747

)

Total stockholders' equity

 

 

82,511

 

 

 

81,273

 

Total liabilities and stockholders' equity

 

$

349,930

 

 

$

324,025

 

 

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Contact:

Jason Bates, EVP & CFO
(479) 471-2672
jason.bates@usa-truck.com

Chad Lane, Investor Relations
(479) 471-6680
chad.lane@usa-truck.com

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