Form 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
|
|
|
þ |
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2011
Commission file number: 001-34734
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
|
|
|
Delaware |
|
20-2454942 |
(State or other jurisdiction
|
|
(I.R.S. Employer |
of incorporation or organization)
|
|
Identification No.) |
4900 S. PENNSYLVANIA AVE.
CUDAHY, WISCONSIN 53110
(Address of principal executive offices) (Zip code)
(414) 615-1500
(Registrants telephone number, including area code)
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files).
Yes o No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act.
(Check one):
|
|
|
|
|
|
|
Large accelerated filer o
|
|
Accelerated filer o
|
|
Non-accelerated filer þ
|
|
Smaller reporting company o |
|
|
|
|
(Do not check if a smaller reporting company) |
|
|
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). Yes o No þ
Number of shares of common stock, $0.01 par value, of registrant outstanding at May 11, 2011:
30,201,889.
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 2011
TABLE OF CONTENTS
1
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
|
December 31, |
|
|
|
2011 |
|
|
2010 |
|
ASSETS |
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
523 |
|
|
$ |
996 |
|
Accounts receivable, net |
|
|
84,533 |
|
|
|
73,222 |
|
Deferred income taxes |
|
|
6,367 |
|
|
|
6,367 |
|
Prepaid expenses and other current assets |
|
|
13,119 |
|
|
|
10,414 |
|
|
|
|
|
|
|
|
Total current assets |
|
|
104,542 |
|
|
|
90,999 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY AND EQUIPMENT, NET |
|
|
8,475 |
|
|
|
6,894 |
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS: |
|
|
|
|
|
|
|
|
Goodwill |
|
|
263,362 |
|
|
|
246,888 |
|
Other noncurrent assets |
|
|
4,249 |
|
|
|
3,516 |
|
|
|
|
|
|
|
|
Total other assets |
|
|
267,611 |
|
|
|
250,404 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
380,628 |
|
|
$ |
348,297 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS INVESTMENT |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
39,969 |
|
|
$ |
37,241 |
|
Accrued expenses and other liabilities |
|
|
14,697 |
|
|
|
11,375 |
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
54,666 |
|
|
|
48,616 |
|
|
|
|
|
|
|
|
|
|
LONG-TERM DEBT |
|
|
39,602 |
|
|
|
20,500 |
|
OTHER LONG-TERM LIABILITIES |
|
|
10,861 |
|
|
|
8,492 |
|
PREFERRED STOCK SUBJECT TO MANDATORY REDEMPTION |
|
|
5,000 |
|
|
|
5,000 |
|
|
|
|
|
|
|
|
Total liabilities |
|
|
110,129 |
|
|
|
82,608 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES (NOTE 9) |
|
|
|
|
|
|
|
|
STOCKHOLDERS INVESTMENT: |
|
|
|
|
|
|
|
|
Common stock $.01 par value; 100,000 shares authorized;
30,188 and 30,147 shares issued and outstanding |
|
|
302 |
|
|
|
301 |
|
Additional paid-in capital |
|
|
262,497 |
|
|
|
262,088 |
|
Retained earnings |
|
|
7,700 |
|
|
|
3,300 |
|
|
|
|
|
|
|
|
Total stockholders investment |
|
|
270,499 |
|
|
|
265,689 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS INVESTMENT |
|
$ |
380,628 |
|
|
$ |
348,297 |
|
|
|
|
|
|
|
|
See notes to unaudited condensed consolidated financial statements.
2
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2011 |
|
|
2010 |
|
Revenues |
|
$ |
171,158 |
|
|
$ |
142,762 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Purchased transportation costs |
|
|
130,367 |
|
|
|
110,667 |
|
Personnel and related benefits |
|
|
17,735 |
|
|
|
14,268 |
|
Other operating expenses |
|
|
14,434 |
|
|
|
9,464 |
|
Depreciation and amortization |
|
|
829 |
|
|
|
851 |
|
Acquisition transaction expenses |
|
|
214 |
|
|
|
332 |
|
|
|
|
|
|
|
|
Total operating expenses |
|
|
163,579 |
|
|
|
135,582 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
7,579 |
|
|
|
7,180 |
|
|
|
|
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
|
|
|
Interest on long-term debt |
|
|
433 |
|
|
|
4,642 |
|
Dividends on preferred stock subject to mandatory redemption |
|
|
50 |
|
|
|
50 |
|
|
|
|
|
|
|
|
Total interest expense |
|
|
483 |
|
|
|
4,692 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
7,096 |
|
|
|
2,488 |
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
2,696 |
|
|
|
1,031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
4,400 |
|
|
|
1,457 |
|
|
|
|
|
|
|
|
|
|
Accretion of Series B preferred stock |
|
|
|
|
|
|
515 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income available to common stockholders |
|
$ |
4,400 |
|
|
$ |
942 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share available to common stockholders: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.15 |
|
|
$ |
0.05 |
|
|
|
|
|
|
|
|
Diluted |
|
$ |
0.14 |
|
|
$ |
0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common stock outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
30,167 |
|
|
|
18,275 |
|
|
|
|
|
|
|
|
Diluted |
|
|
31,391 |
|
|
|
19,023 |
|
|
|
|
|
|
|
|
See notes to unaudited condensed consolidated financial statements.
3
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2011 |
|
|
2010 |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net income |
|
$ |
4,400 |
|
|
$ |
1,457 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
924 |
|
|
|
1,167 |
|
Gain on disposal of buildings and equipment |
|
|
(9 |
) |
|
|
(4 |
) |
Deferred interest |
|
|
|
|
|
|
1,845 |
|
Share-based compensation |
|
|
129 |
|
|
|
147 |
|
Provision for bad debts and freight bill adjustments |
|
|
225 |
|
|
|
197 |
|
Deferred tax provision |
|
|
2,166 |
|
|
|
990 |
|
Changes in: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(6,572 |
) |
|
|
(7,411 |
) |
Prepaid expenses and other assets |
|
|
(1,923 |
) |
|
|
72 |
|
Accounts payable |
|
|
1,696 |
|
|
|
3,351 |
|
Accrued expenses and other liabilities |
|
|
2,107 |
|
|
|
1,253 |
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
3,143 |
|
|
|
3,064 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Acquisition of business, net of cash acquired |
|
|
(20,000 |
) |
|
|
(1,910 |
) |
Capital expenditures |
|
|
(1,199 |
) |
|
|
(356 |
) |
Proceeds from sale of buildings and equipment |
|
|
12 |
|
|
|
13 |
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
|
(21,187 |
) |
|
|
(2,253 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Borrowings under old revolving credit facilities |
|
|
|
|
|
|
15,540 |
|
Payments under old revolving credit facilities |
|
|
|
|
|
|
(15,280 |
) |
Borrowings under new revolving credit facility, net of issuance costs |
|
|
45,755 |
|
|
|
|
|
Payments under new revolving credit facility |
|
|
(26,653 |
) |
|
|
|
|
Payments of contingent earnouts |
|
|
(1,712 |
) |
|
|
|
|
Long-term debt borrowings, net of issuance costs |
|
|
|
|
|
|
1,184 |
|
Long-term debt payments |
|
|
|
|
|
|
(2,235 |
) |
Proceeds from issuance of common stock, net of issuance costs |
|
|
281 |
|
|
|
978 |
|
Reduction of capital lease obligation |
|
|
(100 |
) |
|
|
(88 |
) |
|
|
|
|
|
|
|
Net cash provided by financing activities |
|
|
17,571 |
|
|
|
99 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS |
|
|
(473 |
) |
|
|
910 |
|
|
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS: |
|
|
|
|
|
|
|
|
Beginning of period |
|
|
996 |
|
|
|
2,176 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End of period |
|
$ |
523 |
|
|
$ |
3,086 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH FLOWS INFORMATION: |
|
|
|
|
|
|
|
|
Cash paid for interest |
|
$ |
326 |
|
|
$ |
1,913 |
|
Cash paid (refunded) for income taxes (net) |
|
$ |
255 |
|
|
$ |
99 |
|
Noncash Series B convertible preferred stock dividend |
|
$ |
|
|
|
$ |
515 |
|
See notes to unaudited condensed consolidated financial statements.
4
Roadrunner Transportation Systems, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
1. |
|
Organization, Nature of Business and Significant Accounting Policies |
|
|
Roadrunner Transportation Systems, Inc. (the Company) is headquartered in Cudahy, Wisconsin and
has three operating segments, less-than-truckload (LTL), truckload (TL) and transportation
management solutions (TMS). Within its LTL business, the Company operates 17 service centers
throughout the United States, complemented by relationships with over 200 delivery agents.
Within its TL business, the Company operates 19 service centers, nine dispatch offices and is
augmented by 74 independent agents. The Company operates its TMS business from three service
centers throughout the United States. From pickup to delivery, the Company leverages
relationships with a diverse group of third-party carriers to provide scalable capacity and
reliable, customized service to customers in North America. The Company operates primarily in
the United States. |
|
|
On February 29, 2008, Thayer | Hidden Creek Partners II, L.P. (THCP II), through an indirect
majority-owned subsidiary, GTS Acquisition Sub, Inc. (GTS), acquired all of the outstanding
capital stock of Group Transportation Services, Inc. and all of the outstanding membership units
of GTS Direct, LLC (the Transaction). THCP II is an affiliate of Thayer Equity Investors V,
L.P., the controlling shareholder of the Company. GTS was formed on February 12, 2008 and there
were no substantive operations from date of inception until the Transaction on February 29, 2008.
On May 18, 2010, GTS merged with a wholly owned subsidiary of the Company (the GTS Merger). |
|
|
Principles of Consolidation |
|
|
The accompanying condensed consolidated financial statements include the results of operations of
each segment for all periods presented. All intercompany balances and transactions have been
eliminated in consolidation. |
|
|
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States (GAAP) requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of revenue and
expenses during the reporting period. Actual results could differ from those estimates. |
|
|
On September 15, 2009, through GTS, the Company acquired all of the outstanding membership
interests of Mesca Freight Services, LLC (Mesca) for purposes of expanding its current market
presence and service offerings in the TMS segment. Mesca operates as a non-asset based,
third-party logistics provider. Total consideration was $9.1 million, including $1.8 million of
cash acquired. A working capital adjustment in the amount of $0.1 million was paid by GTS in
2010. The acquisition price and related financing fees of approximately $0.1 million were
financed with proceeds from the issuance of common stock by GTS of $4.2 million and borrowings
under a credit facility of $4.4 million. GTS incurred $0.6 million of transaction expenses
related to this acquisition. |
|
|
In addition to cash paid at closing, the Mesca purchase agreement calls for contingent
consideration in the form of an earnout. The former owners of Mesca are entitled to receive a
payment equal to the amount by which Mescas earnings before income taxes, depreciation and
amortization, as defined in the purchase agreement, exceeds $1.6 million for the years ending
December 31, 2010 and 2011. Approximately $2.4 million has been included in goodwill and is
included in the TMS segment. The Company has paid $1.6 million for the earnout as of March 31,
2011. |
|
|
On December 7, 2009, through GTS, the Company acquired all of the outstanding stock of Great
Northern Transportation Services, Inc. (GNTS) for purposes of expanding its current market
presence and service offerings in the TMS segment. GNTS is an agent of Mesca and operates from
New Hampshire. Total consideration was $1.7 million, including $0.2 million of cash acquired.
The acquisition price was financed with proceeds from the
issuance of common stock by GTS of $0.9 million and borrowings under a credit facility of $0.9
million. GTS incurred $0.2 million of transaction expenses related to this acquisition. |
5
|
|
In addition to cash paid at closing, the GNTS purchase agreement calls for contingent
consideration in the form of an earnout. The former owner of GNTS is entitled to receive a
payment equal to the amount by which GNTS earnings before income taxes, depreciation and
amortization, as defined in the purchase agreement, exceeds $0.6 million for the years ending
December 31, 2010 and 2011. Approximately $0.2 million has been included in goodwill and is
included in the TMS segment. The Company has paid $0.1 million for the earnout as of March 31,
2011. |
|
|
On February 12, 2010, through GTS, the Company acquired all the outstanding stock of Alpha
Freight Systems, Inc. (Alpha) for purposes of expanding its current market presence and service
offerings in the TMS segment. Total consideration was $2.0 million, including $0.1 million of
cash acquired. The acquisition price was financed with proceeds from the issuance of common
stock by GTS of $1.0 million and borrowings under a credit facility of $1.2 million. GTS
incurred $0.3 million of transaction expenses related to this acquisition. |
|
|
On February 4, 2011, the Company acquired all the outstanding stock of Morgan Southern Inc.
(Morgan Southern) for purposes of expanding its current market presence and service offerings
in the TL segment. Total consideration paid was $20.0 million. The acquisition price was
financed with borrowings under the Companys existing revolving credit facility. The Company
incurred $0.3 million of transaction expenses related to this acquisition. |
|
|
The following is a summary of the allocation of the purchase price paid to the fair value of the
net assets (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Morgan |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Southern |
|
|
|
Mesca |
|
|
GNTS |
|
|
Alpha |
|
|
(Preliminary) |
|
Accounts receivable |
|
$ |
1,895 |
|
|
$ |
706 |
|
|
$ |
519 |
|
|
$ |
5,024 |
|
Other current assets |
|
|
69 |
|
|
|
|
|
|
|
8 |
|
|
|
1,414 |
|
Property and equipment |
|
|
170 |
|
|
|
|
|
|
|
25 |
|
|
|
1,041 |
|
Goodwill |
|
|
8,986 |
|
|
|
1,643 |
|
|
|
1,869 |
|
|
|
16,474 |
|
Customer relationships intangible assets |
|
|
246 |
|
|
|
|
|
|
|
|
|
|
|
500 |
|
Other noncurrent assets |
|
|
1 |
|
|
|
1 |
|
|
|
|
|
|
|
362 |
|
Accounts payable and other liabilities |
|
|
(4,010 |
) |
|
|
(819 |
) |
|
|
(511 |
) |
|
|
(4,815 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
7,357 |
|
|
$ |
1,531 |
|
|
$ |
1,910 |
|
|
$ |
20,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Mesca, GNTS, Alpha and Morgan Southern goodwill is a result of acquiring and retaining
their existing workforces and expected synergies from integrating their operations into the
Company. |
|
|
Morgan Southern contributed revenues to the Company of
$9.6 million since the acquisition on February 4, 2011 and the impact to the
Companys net income was not material. On a pro forma basis, assuming the acquisition
had closed on January 1, 2010, Morgan Southern would have contributed revenues
to the Company of $13.2 million for the three months ended March 31, 2010 and
$4.7 million for the period ended February 3, 2011. The impact of Morgan Southern
to the Companys net income during these periods would not have been material.
The Companys results of operations were not materially impacted by the acquisition of
Alpha. The results of operations and financial condition of these acquisitions have
been included in our consolidated financial statements since their acquisition dates. |
3. |
|
Goodwill and Intangible Assets |
|
|
Goodwill represents the excess of the purchase price of each acquisition over the estimated fair
value of the net assets acquired. The Company completes an annual goodwill impairment test as of
July 1. The 2010 impairment test did not result in any impairment losses. There is no goodwill
impairment for any of the periods presented in the Companyour financial statements. |
|
|
The following is a rollforward of goodwill from December 31, 2010 to March 31, 2011 by reportable
segment (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
|
TL |
|
|
TMS |
|
|
Total |
|
Goodwill balance as of December 31, 2010 |
|
$ |
185,406 |
|
|
$ |
25,776 |
|
|
$ |
35,706 |
|
|
$ |
246,888 |
|
Acquisition of Morgan Southern |
|
|
|
|
|
|
16,474 |
|
|
|
|
|
|
|
16,474 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill balance as of March 31, 2011 |
|
$ |
185,406 |
|
|
$ |
42,250 |
|
|
$ |
35,706 |
|
|
$ |
263,362 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6
|
|
Intangible assets consist of customer relationships acquired from business acquisitions.
Intangible assets at March 31, 2011 and December 31, 2010 are as follows (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2011 |
|
|
December 31, 2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross |
|
|
|
|
|
|
Net |
|
|
Gross |
|
|
|
|
|
|
Net |
|
|
|
Carrying |
|
|
Accumulated |
|
|
Carrying |
|
|
Carrying |
|
|
Accumulated |
|
|
Carrying |
|
|
|
Amount |
|
|
Amortization |
|
|
Value |
|
|
Amount |
|
|
Amortization |
|
|
Value |
|
Customer relationships TL |
|
$ |
2,300 |
|
|
$ |
1,637 |
|
|
$ |
663 |
|
|
$ |
1,800 |
|
|
$ |
1,530 |
|
|
$ |
270 |
|
Customer relationships LTL |
|
|
800 |
|
|
|
200 |
|
|
|
600 |
|
|
|
800 |
|
|
|
160 |
|
|
|
640 |
|
Customer relationships TMS |
|
|
546 |
|
|
|
259 |
|
|
|
287 |
|
|
|
546 |
|
|
|
232 |
|
|
|
314 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total customer relationships |
|
$ |
3,646 |
|
|
$ |
2,096 |
|
|
$ |
1,550 |
|
|
$ |
3,146 |
|
|
$ |
1,922 |
|
|
$ |
1,224 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The customer relationships intangible assets are amortized over a five-year useful
life. |
4. |
|
Fair Value Measurement |
|
|
Accounting guidance on fair value measurements for certain financial assets and liabilities
requires that assets and liabilities carried at fair value be classified and disclosed in one of
the following three categories: |
|
|
|
|
|
Level 1
|
|
|
|
Quoted market prices in active markets for identical assets or liabilities. |
|
|
|
|
|
Level 2
|
|
|
|
Observable market-based inputs or unobservable inputs that are corroborated by market data. |
|
|
|
|
|
Level 3
|
|
|
|
Unobservable inputs reflecting the reporting entitys own assumptions or external inputs from inactive markets. |
|
|
A financial asset or liabilitys classification within the hierarchy is determined based on the
lowest level of input that is significant to the fair value measurement. |
|
|
The following table presents information, as of March 31, 2011 and December 31, 2010, about the
Companys financial liabilities, the contingent purchase price related to acquisitions that are
measured at fair value on a recurring basis, according to the valuation techniques the Company
used to determine their fair values (in thousands): |
March 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair |
|
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Value |
|
Contingent purchase price related to acquisitions |
|
$ |
|
|
|
$ |
|
|
|
$ |
1,304 |
|
|
$ |
1,304 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities at fair value |
|
$ |
|
|
|
$ |
|
|
|
$ |
1,304 |
|
|
$ |
1,304 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair |
|
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Value |
|
Contingent purchase price related to acquisitions |
|
$ |
|
|
|
$ |
|
|
|
$ |
2,977 |
|
|
$ |
2,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities at fair value |
|
$ |
|
|
|
$ |
|
|
|
$ |
2,977 |
|
|
$ |
2,977 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In measuring the fair value of the contingent payment liability, the Company used an income
approach that considers the expected future earnings of the acquired businesses and the resulting
contingent payments, discounted at a risk-adjusted rate. |
|
|
The table below sets forth a reconciliation of the Companys beginning and ending Level 3
financial liability balance as of March 31, 2011 (in thousands): |
|
|
|
|
|
Balance as of December 31, 2010 |
|
$ |
2,977 |
|
Payment of contingent purchase obligation |
|
|
(1,712 |
) |
Adjustment to contingent purchase obligation |
|
|
39 |
|
|
|
|
|
Balance as of March 31, 2011 |
|
$ |
1,304 |
|
|
|
|
|
7
|
|
Long-term debt consisted of $39,602 and $20,500 as of March 31, 2011 and December 31, 2010,
respectively. In connection with our initial public offering (IPO), the Company entered into a
new credit agreement on May 18, 2010 with U.S. Bank National Association. The credit agreement
is a five-year, $55 million revolving credit facility collateralized by all assets of the Company
and is subject to a borrowing base equal to 85% of the Companys eligible receivables. The
credit agreement contains certain financial covenants, including a minimum fixed charge coverage
ratio and a maximum cash flow leverage ratio. As of March 31, 2011, the Company was in
compliance with all covenants contained in the credit agreement. Borrowings under the credit
agreement bear interest at either (a) the Eurocurrency Rate (as defined in the credit agreement),
plus an applicable margin in the range of 2.5% to 3.0%, or (b) the Base Rate (as defined in the
credit agreement), plus an applicable margin in the range of 1.5% to 2.0%. The revolving credit
facility also provides for the issuance of up to $8.0 million in letters of credit. As of March
31, 2011, the Company had outstanding letters of credit totaling $6.3 million. Total
availability under the revolving credit facility was $9.1 million as of March 31, 2011. At March
31, 2011, the average interest rate on the revolving credit facility was 3.22%. |
|
|
Series A Redeemable Preferred Stock |
|
|
In March 2007, the Company issued and had outstanding 5,000 shares of non-voting Series A
Preferred Stock (Series A Preferred Stock), which are mandatorily redeemable by the Company at
$1,000 per share, in cash, on November 30, 2012. The Series A Preferred Stock receives cash
dividends annually on April 30 at an annual rate equal to $40 per share, and if such dividends
are not paid when due, such annual dividend rate shall increase to $60 per share and continue to
accrue without interest until such delinquent payments are made. At March 31, 2011 and December
31, 2010, $192,000 and $142,000 is recorded as a current liability for dividends, respectively.
The holders of the Series A Preferred Stock are restricted from transferring such shares and the
Company has a first refusal right and may elect to repurchase the shares prior to the mandatory
November 30, 2012 redemption. Upon liquidation and certain transactions treated as liquidations,
as defined in the Companys Certificate of Incorporation, the Series A Preferred Stock has
liquidation preferences over the Companys common stock. The number of issued and outstanding
shares of Series A Preferred Stock, the $1,000 per share repurchase price, and the annual cash
dividends are all subject to equitable adjustment whenever there is a stock split, stock
dividend, combination, recapitalization, reclassification or other similar event. As long as
there is Series A Preferred Stock outstanding, no dividends may be declared or paid on common
stock of the Company. |
|
|
Basic earnings per common share is calculated by dividing net income available to common
stockholders by the weighted average common stock outstanding during the period. At March 31,
2011 and March 31, 2010, diluted earnings per share is calculated by dividing net income by the
weighted average common stock outstanding plus stock equivalents that would arise from the
assumed exercise of stock options and conversion of warrants using the treasury stock method.
There is no difference, for any of the periods presented, in the amount of net income available
to common stockholders used in the computation of basic and diluted earnings per share. |
8
|
|
The following table reconciles basic weighted average stock outstanding to diluted weighted
average stock outstanding (in thousands): |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
|
2011 |
|
|
2010 |
|
Basic weighted average stock outstanding |
|
|
30,167 |
|
|
|
18,275 |
|
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
Employee stock options |
|
|
504 |
|
|
|
378 |
|
Warrants |
|
|
720 |
|
|
|
370 |
|
|
|
|
|
|
|
|
Dilutive weighted average stock outstanding |
|
|
31,391 |
|
|
|
19,023 |
|
|
|
|
|
|
|
|
|
|
The Company had additional stock options and warrants outstanding of 308,698 and 3,037,727
as of March 31, 2011 and March 31, 2010, respectively. These shares were not included in the
computation of diluted earnings per share because they were not assumed to be exercised under the
treasury stock method or were anti-dilutive. |
|
|
The effective income tax rate was 38.0% for the three months ended March 31, 2011, compared with
41.4% for the three months ended March 31, 2010. In determining the quarterly provision for
income taxes, the Company used an estimated annual effective tax rate, which was based on
expected annual income, statutory tax rates, and its best estimate of non-deductible and
non-taxable items of income and expense. Income tax expense varies from the amount computed by
applying the federal corporate income tax rate of 35.0% to income before income taxes primarily
due to state income taxes, net of federal income tax effect, Canadian income taxes, and
adjustments for permanent differences. |
9. |
|
Commitments and Contingencies |
|
|
In the ordinary course of business, the Company is a defendant in several property and other
claims. In the aggregate, the Company does not believe any of these claims will have a material
impact on its consolidated financial statements. The Company maintains liability insurance
coverage for claims in excess of $500,000 per occurrence and cargo coverage for claims in excess
of $100,000 per occurrence. Management believes it has adequate insurance to cover losses in
excess of the deductible amount. As of March 31, 2011 and December 31, 2010, the Company had
reserves for estimated uninsured losses of $3.5 million and $2.6 million, respectively. |
10. |
|
Related Party Transactions |
|
|
As part of the 2007 acquisition of Big Rock Transportation, Inc., Midwest Carriers, Inc., Sargent
Trucking, Inc., B&J Transportation, Inc., and Smith Truck Brokers, Inc. (collectively,
Sargent), the Company was required to pay an earnout to the former Sargent owners and now
Series A Preferred Stock holders. At both March 31, 2011 and December 31, 2010, $0.8 million
earned in 2006 and 2007 was classified as an other long-term liability. The Companys obligation
to make further contingent payments to the former Sargent owners terminated as of December 31,
2009. |
|
|
As part of the Bullet Freight Systems, Inc. acquisition in 2009, the Company issued eight-year
warrants exercisable for an aggregate 268,765 shares of Class A common stock payable to the
former Bullet owners. These warrants were exercised in July of 2010. Additionally, certain
existing stockholders and their affiliates also received eight-year warrants exercisable for an
aggregate 1,388,620 shares of Class A common stock payable to existing stockholders and their
affiliates. These warrants are still outstanding as of March 31, 2011. |
|
|
The Company determines its operating segments based on the information utilized by the chief
operating decision maker, the Companys Chief Executive Officer, to allocate resources and assess
performance. Based on this information, the Company has determined that it has three operating
segments, which are also reportable segments: LTL, TL and TMS. |
9
|
|
These reportable segments are strategic business units through which the Company offers different
services. The Company evaluates the performance of the segments primarily based on their
respective revenues and operating income. Accordingly, interest expense and other non-operating
items are not reported in segment results. In addition, the Company has disclosed a corporate
segment, which is not an operating segment and includes public company expenses, acquisition
transaction expenses, corporate salaries and stock-based compensation expense. |
|
|
The following table reflects certain financial data of the Companys reportable segments (in
thousands): |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
|
2011 |
|
|
2010 |
|
Revenues: |
|
|
|
|
|
|
|
|
LTL |
|
$ |
100,654 |
|
|
$ |
91,326 |
|
TL |
|
|
54,576 |
|
|
|
38,191 |
|
TMS |
|
|
16,515 |
|
|
|
13,738 |
|
Eliminations |
|
|
(587 |
) |
|
|
(493 |
) |
|
|
|
|
|
|
|
Total |
|
$ |
171,158 |
|
|
$ |
142,762 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income: |
|
|
|
|
|
|
|
|
LTL |
|
$ |
4,879 |
|
|
$ |
5,166 |
|
TL |
|
|
2,493 |
|
|
|
1,543 |
|
TMS |
|
|
1,319 |
|
|
|
952 |
|
Corporate |
|
|
(1,112 |
) |
|
|
(481 |
) |
|
|
|
|
|
|
|
Total operating income |
|
$ |
7,579 |
|
|
$ |
7,180 |
|
Interest expense |
|
|
483 |
|
|
|
4,692 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
$ |
7,096 |
|
|
$ |
2,488 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and Amortization: |
|
|
|
|
|
|
|
|
LTL |
|
$ |
401 |
|
|
$ |
504 |
|
TL |
|
|
251 |
|
|
|
180 |
|
TMS |
|
|
177 |
|
|
|
167 |
|
|
|
|
|
|
|
|
Total |
|
$ |
829 |
|
|
$ |
851 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Expenditures: |
|
|
|
|
|
|
|
|
LTL |
|
$ |
900 |
|
|
$ |
205 |
|
TL |
|
|
267 |
|
|
|
84 |
|
TMS |
|
|
32 |
|
|
|
67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
1,199 |
|
|
$ |
356 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 30, |
|
|
December 31, |
|
|
|
2011 |
|
|
2010 |
|
Assets: |
|
|
|
|
|
|
|
|
LTL |
|
$ |
282,186 |
|
|
$ |
259,706 |
|
TL |
|
|
76,263 |
|
|
|
49,533 |
|
TMS |
|
|
44,334 |
|
|
|
44,905 |
|
Eliminations |
|
|
(22,155 |
) |
|
|
(5,847 |
) |
|
|
|
|
|
|
|
Total |
|
$ |
380,628 |
|
|
$ |
348,297 |
|
|
|
|
|
|
|
|
10
|
|
|
ITEM 2. |
|
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS |
You should read the following discussion and analysis of our financial condition and results
of operations in conjunction with our condensed consolidated financial statements and the related
notes and other financial information included in our Quarterly Report on Form 10-Q. This
discussion and analysis contains forward-looking statements that involve risks and uncertainties.
Our actual results could differ materially from the forward-looking statements. Among the factors
that could cause actual results to differ materially are the factors discussed in the section Item
1A Risk Factors of Part II below and elsewhere in this Quarterly Report. This discussion and
analysis should also be read in conjunction with Managements Discussion and Analysis of Financial
Condition and Results of Operations relating to our results for the year ended December 31, 2010,
set forth in our 10-K filed with the Securities and Exchange Commission on March 31, 2011.
Company Overview
We are a leading non-asset based transportation and logistics service provider offering a full
suite of solutions, including customized and expedited LTL, TL, TMS, intermodal solutions
(transporting a shipment by more than one mode, primarily via rail and truck), and domestic and
international air. We utilize a broad third-party network of transportation providers, comprised
of independent contractors (ICs) and purchased power providers, to serve a diverse customer base
in terms of end market focus and annual freight expenditures. Although we service large national
accounts, we primarily focus on small to mid-size shippers, which we believe represent an expansive
and underserved market. Our business model is highly scalable and flexible, featuring a variable
cost structure that requires minimal investment in transportation equipment and facilities, thereby
enhancing free cash flow generation and returns on our invested capital and assets.
We have three reportable operating segments:
Less-than-Truckload. Our LTL business involves the pickup, consolidation, linehaul,
deconsolidation, and delivery of LTL shipments throughout the United States and into Mexico, Puerto
Rico, and Canada. With a network of 17 service centers and over 200 third-party delivery agents,
we employ a point-to-point LTL model that we believe serves as a competitive advantage over the
traditional hub and spoke LTL model in terms of faster transit times, lower incidence of damage,
and reduced fuel consumption. Our LTL segment also includes domestic and international air
transportation services.
Truckload. Within our TL business, we arrange the pickup and delivery of TL freight through
our network of 19 service centers, nine company dispatch offices, and 74 independent agents
primarily located throughout the Eastern United States and Canada. We offer
temperature-controlled, dry van, intermodal drayage, and flatbed services and specialize in the
transport of refrigerated foods, poultry, and beverages. We believe this specialization provides
consistent shipping volume year-over-year.
Transportation Management Solutions. Within our TMS business, we offer a one-stop
transportation and logistics solution, including access to the most cost-effective and
time-sensitive modes of transportation within our broad network. Specifically, our TMS offering
includes pricing, contract management, transportation mode and carrier selection, freight tracking,
freight bill payment and audit, cost reporting and analysis, and dispatch. Our customized TMS
offering is designed to allow our customers to reduce operating costs, redirect resources to core
competencies, improve supply chain efficiency, and enhance customer service.
Our success principally depends on our ability to generate revenues through our network of
sales personnel and independent agents and to deliver freight in all modes safely, on time, and
cost-effectively through a suite of solutions tailored to the needs of each client. Customer
shipping demand, over-the-road freight tonnage levels, and equipment capacity, which are subject to
overall economic conditions, ultimately drive increases or decreases in our revenues. Our ability
to operate profitably and generate cash is also impacted by the average over-the-road length of
haul, pricing dynamics, customer mix, and our ability to manage costs effectively. Within our LTL
business, we typically generate revenues by charging our customers a rate based on shipment weight,
distance hauled, and commodity type. This amount is typically comprised of a base rate, a fuel
surcharge, and any applicable service fees. Within our TL business, we typically charge a flat rate
negotiated on each load based upon the industry factors noted above and in place at the time of the
freight movement. Within our TMS business, we typically charge a variable rate on each shipment in
addition to transaction or service fees appropriate for the solution we have developed for a
specific customers needs.
11
We incur costs that are directly related to the transportation of freight, including purchased
transportation costs and commissions paid to our agents. We also incur indirect costs associated
with the transportation of freight that include other operating costs, such as insurance and
claims. In addition, we incur personnel-related costs and other operating expenses, collectively
discussed herein as other operating expenses, essential to administering our operations. We
continually monitor all components of our cost structure and establish annual budgets, which are
generally used to benchmark costs incurred on a monthly basis.
Purchased transportation costs within our LTL business represent amounts we pay to ICs or
purchased power providers and are generally contractually agreed-upon rates. Purchased
transportation costs within our TL business are typically based on negotiated rates for each load
hauled. We pay commissions to each agent based on a percentage of margin generated. Within our TMS
business, purchased transportation costs include payments made to our purchased power providers,
which are generally contractually agreed-upon rates. Purchased transportation costs are the largest
component of our cost structure and are generally higher as a percentage of revenues within our TL
business than within our LTL and TMS businesses. Our purchased transportation costs typically
increase or decrease in proportion to revenues.
Our ability to maintain or grow existing tonnage levels is impacted by overall economic
conditions, shipping demand, and over-the-road freight capacity in North America, as well as by our
ability to offer a competitive solution in terms of pricing, safety, and on-time delivery.
The industry pricing environment also impacts our operating performance. Our LTL pricing is
typically measured by billed revenue per hundredweight, often referred to as yield, and is
dictated primarily by factors such as average shipment size, shipment frequency and consistency,
average length of haul, freight density, and customer and geographic mix. Pricing within our TL
business generally has fewer influential factors than pricing within our LTL business, but is also
typically driven by shipment frequency and consistency, average length of haul, and customer and
geographic mix. Since we offer both LTL and TL shipping as part of our TMS offering, pricing within
our TMS segment is impacted by similar factors. The pricing environment for all of our operations
generally becomes more competitive during periods of lower industry tonnage levels and increased
capacity within the over-the-road freight sector.
The transportation industry is dependent upon the availability of adequate fuel supplies. Our
LTL business typically charges a fuel surcharge based on changes in diesel fuel prices compared to
a national index. Although revenues from fuel surcharges generally more than offset increases in
fuel costs, other operating costs have been, and may continue to be, impacted by fluctuating fuel
prices. The total impact of higher energy prices on other nonfuel-related expenses is difficult to
ascertain. We cannot predict future fuel price fluctuations, the impact of higher energy prices on
other cost elements, recoverability of higher fuel costs through fuel surcharges, and the effect of
fuel surcharges on our overall rate structure or the total price that we will receive from our
customers. Depending on the changes in the fuel rates and the impact on costs in other fuel- and
energy-related areas, operating margins could be impacted. Whether fuel prices fluctuate or remain
constant, our operating income may be adversely affected if competitive pressures limit our ability
to recover fuel surcharges. The operating income of our TL and TMS businesses is not impacted
directly by changes in fuel rates as we are able to pass through fuel costs to our customers.
Recent Acquisitions
In February 2011, we acquired all of the outstanding stock of Morgan Southern, Inc. for
purposes of expanding our intermodal presence within our TL segment. Headquartered in Georgia,
Morgan Southern provides primarily intermodal transportation and related services. Morgan Southern
employs city drivers and leases equipment to make city deliveries along with the utilization of
ICs. See acquisition footnote 2 within the notes to the unaudited condensed consolidated financial
statements.
12
Results of Operations
The following table sets forth, for the periods indicated, summary LTL, TL, TMS, corporate,
and consolidated statement of operations data. Such revenue data for our LTL, TL, and TMS business
segments are expressed as a percentage of consolidated revenues. Other statement of operations
data for our LTL, TL, and TMS business segments are expressed as a percentage of segment revenues.
Total statement of operations data are expressed as a percentage of consolidated revenues.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
|
2011 |
|
|
2010 |
|
|
|
(In thousands, except for %s) |
|
|
|
|
|
|
|
% of |
|
|
% Growth |
|
|
|
|
|
|
% of |
|
|
|
$ |
|
|
Revenues |
|
|
Y/Y |
|
|
$ |
|
|
Revenues |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
$ |
100,654 |
|
|
|
58.8 |
% |
|
|
10.2 |
% |
|
$ |
91,326 |
|
|
|
64.0 |
% |
TL |
|
|
54,576 |
|
|
|
31.9 |
% |
|
|
42.9 |
% |
|
|
38,191 |
|
|
|
26.8 |
% |
TMS |
|
|
16,515 |
|
|
|
9.6 |
% |
|
|
20.2 |
% |
|
|
13,738 |
|
|
|
9.6 |
% |
Eliminations |
|
|
(587 |
) |
|
|
(0.3 |
%) |
|
NM |
|
|
|
(493 |
) |
|
|
(0.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
171,158 |
|
|
|
100.0 |
% |
|
|
19.9 |
% |
|
|
142,762 |
|
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased transportation costs: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
|
75,133 |
|
|
|
74.6 |
% |
|
|
11.9 |
% |
|
|
67,154 |
|
|
|
73.5 |
% |
TL |
|
|
43,760 |
|
|
|
80.2 |
% |
|
|
29.1 |
% |
|
|
33,897 |
|
|
|
88.8 |
% |
TMS |
|
|
12,061 |
|
|
|
73.0 |
% |
|
|
19.3 |
% |
|
|
10,109 |
|
|
|
73.6 |
% |
Eliminations |
|
|
(587 |
) |
|
|
100.0 |
% |
|
NM |
|
|
|
(493 |
) |
|
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
130,367 |
|
|
|
76.2 |
% |
|
|
17.8 |
% |
|
|
110,667 |
|
|
|
77.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues (1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
|
25,521 |
|
|
|
25.4 |
% |
|
|
5.6 |
% |
|
|
24,172 |
|
|
|
26.5 |
% |
TL |
|
|
10,816 |
|
|
|
19.8 |
% |
|
|
151.9 |
% |
|
|
4,294 |
|
|
|
11.2 |
% |
TMS |
|
|
4,454 |
|
|
|
27.0 |
% |
|
|
22.7 |
% |
|
|
3,629 |
|
|
|
26.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
40,791 |
|
|
|
23.8 |
% |
|
|
27.1 |
% |
|
|
32,095 |
|
|
|
22.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses (2): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
|
20,241 |
|
|
|
20.1 |
% |
|
|
9.4 |
% |
|
|
18,502 |
|
|
|
20.3 |
% |
TL |
|
|
8,072 |
|
|
|
14.8 |
% |
|
|
214.0 |
% |
|
|
2,571 |
|
|
|
6.7 |
% |
TMS |
|
|
2,958 |
|
|
|
17.9 |
% |
|
|
17.8 |
% |
|
|
2,510 |
|
|
|
18.3 |
% |
Corporate |
|
|
1,112 |
|
|
|
0.6 |
% |
|
|
131.2 |
% |
|
|
481 |
|
|
|
0.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
32,383 |
|
|
|
18.9 |
% |
|
|
34.6 |
% |
|
|
24,064 |
|
|
|
16.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
|
401 |
|
|
|
0.4 |
% |
|
|
(20.4 |
%) |
|
|
504 |
|
|
|
0.6 |
% |
TL |
|
|
251 |
|
|
|
0.5 |
% |
|
|
39.4 |
% |
|
|
180 |
|
|
|
0.5 |
% |
TMS |
|
|
177 |
|
|
|
1.1 |
% |
|
|
6.0 |
% |
|
|
167 |
|
|
|
1.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
829 |
|
|
|
0.5 |
% |
|
|
(2.6 |
%) |
|
|
851 |
|
|
|
0.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LTL |
|
|
4,879 |
|
|
|
4.8 |
% |
|
|
(5.6 |
%) |
|
|
5,166 |
|
|
|
5.7 |
% |
TL |
|
|
2,493 |
|
|
|
4.6 |
% |
|
|
61.6 |
% |
|
|
1,543 |
|
|
|
4.0 |
% |
TMS |
|
|
1,319 |
|
|
|
8.0 |
% |
|
|
38.6 |
% |
|
|
952 |
|
|
|
6.9 |
% |
Corporate |
|
|
(1,112 |
) |
|
|
|
|
|
|
|
|
|
|
(481 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
7,579 |
|
|
|
4.4 |
% |
|
|
5.6 |
% |
|
|
7,180 |
|
|
|
5.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
483 |
|
|
|
0.3 |
% |
|
|
(89.7 |
%) |
|
|
4,692 |
|
|
|
3.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
7,096 |
|
|
|
4.1 |
% |
|
|
185.2 |
% |
|
|
2,488 |
|
|
|
1.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
2,696 |
|
|
|
1.6 |
% |
|
|
161.5 |
% |
|
|
1,031 |
|
|
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
4,400 |
|
|
|
2.6 |
% |
|
|
202.0 |
% |
|
|
1,457 |
|
|
|
1.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accretion of Series B preferred stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
515 |
|
|
|
0.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income available to common stockholders |
|
$ |
4,400 |
|
|
|
2.6 |
% |
|
|
367.1 |
% |
|
$ |
942 |
|
|
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Reflects revenues less purchased transportation costs. |
|
(2) |
|
Reflects the sum of the personnel and related benefits, other operating expenses, and
acquisition transaction expenses |
13
Three Months Ended March 31, 2011 Compared to Three Months Ended March 31, 2010
Revenues
Consolidated revenues increased by $28.4 million, or 19.9%, to $171.2 million during the first
quarter of 2011 from $142.8 million during the first quarter of 2010.
LTL revenues increased by $9.4 million, or 10.2%, to $100.7 million during the first quarter
of 2011 from $91.3 million during the first quarter of 2010. This reflects quarter-over-quarter
LTL tonnage growth of 0.7%, driven by a 3.2% increase in the number of LTL shipments, slightly
offset by a 2.5% decline in weight per shipment. Our LTL tonnage increase was driven by new and
existing customer growth. In addition to growth in tonnage and shipments, our revenue per
hundredweight including fuel surcharges increased during the quarter by 10.3%. This increase in
revenue per hundredweight reflects increased fuel prices quarter-over-quarter and an increase in
revenue per hundredweight excluding fuel of 5.6%, which resulted from the stabilization in the LTL
pricing environment, our yield improvement initiatives, and a change in freight mix that provided
increased revenue per hundredweight. Our yield improvement, include, but are not limited to,
surcharges in certain geographic locations and renegotiation of accounts that have fuel caps or
waivers in effect.
TL revenues increased by $16.4 million, or 42.9%, to $54.6 million during the first quarter of
2011 from $38.2 million during the first quarter of 2010. This growth was primarily driven by a
1.2% increase in the number of loads, a quarter-over-quarter increase in revenue per load of 16.0%,
the expansion of our TL agent network, and the acquisition of Morgan Southern. During the first
quarter of 2011 the Morgan Southern acquisition contributed revenues of $9.6 million.
TMS revenues increased by $2.8 million, or 20.2%, to $16.5 million during the first quarter of
2011 from $13.7 million during the first quarter of 2010, primarily as a result new and existing
customer growth.
Purchased Transportation Costs
Purchased transportation costs increased by $19.7 million, or 17.8%, to $130.4 million during
the first quarter of 2011 from $110.7 million during the first quarter of 2010.
LTL purchased transportation costs increased by $7.9 million, or 11.9%, to $75.1 million
during the first quarter of 2011 from $67.2 million during the first quarter of 2010, and increased
as a percentage of LTL revenues to 74.6% from 73.5%. This increase was primarily the result of
rising fuel prices and an increase in linehaul cost per mile of 5.2% from the first quarter of
2010. Excluding fuel surcharges, our average linehaul cost per mile increased to $1.22 during the
first quarter of 2011 from $1.16 from the first quarter of 2010. This increase was partially
offset by our yield improvement initiatives and linehaul cost reduction initiatives that include
the utilization of our ICs on lanes most impacted by rising rates.
TL purchased transportation costs increased by $9.9 million, or 29.1%, to $43.8 million during
the first quarter of 2011 from $33.9 million during the first quarter of 2010, and decreased as a
percentage of TL revenues to 80.2% from 88.8%, primarily due to Morgan Southern city drivers and
leased equipment expenses being included in other operating expenses. Additionally, increases in
market pricing and expansion of our truckload agent network reduced the percentage of purchased
transportation costs to TL revenues.
TMS purchased transportation costs increased by $2.0 million, or 19.3%, to $12.1 million
during the first quarter of 2011 from $10.1 million during the first quarter of 2010. TMS
purchased transportation costs as a percentage of TMS revenues decreased to 73.0% from 73.6%,
primarily as a result of continued strong revenue growth in higher margin services.
Other Operating Expenses
Other operating expenses, which reflect the sum of the personnel and related benefits, other
operating expenses, and acquisition transaction expenses line items shown in our condensed
consolidated statements of operations, increased by $8.3 million, or 34.6%, to $32.4 million during
the first quarter of 2011 from $24.1 million during the first quarter of 2010.
14
Within our LTL business, other operating expenses increased by $1.7 million, or 9.4%, to $20.2
million during the first quarter of 2011 from $18.5 million during the first quarter of 2010,
primarily as a result of excessive medical and insurance claims not typically experienced, January
and February snow related removal costs, and 2011 economic increases that were not in effect during
the first quarter of 2010. Due to our scalable operating model and targeted cost reduction
initiatives, LTL other operating expenses as a percentage of LTL revenues decreased to 20.1% during
the first quarter of 2011 from 20.3% from the first quarter of 2010.
Within our TL business, other operating expenses increased by $5.5 million, or 214.0%, to $8.1
million during the first quarter of 2011 from $2.6 million during the first quarter of 2010,
primarily as a result of Morgan Southern city drivers and leased equipment expenses being included
in other operating expenses. As a percentage of TL revenues, this represents an increase to 14.8%
from 6.7%.
Within our TMS business, other operating expenses increased by $0.5 million, or 17.8%, to $3.0
million during the first quarter of 2011 from $2.5 million during the first quarter of 2010. As a
percentage of TMS revenues, this represents a decrease to 17.9% from 18.3%.
Other operating expenses that were not allocated to our LTL, TL, or TMS businesses increased
to $1.1 million during the first quarter of 2011 from $0.5 during the first quarter of 2010,
primarily a result of $0.6 million of public company cost that were not incurred during the first
quarter of 2010.
Depreciation and Amortization
Depreciation and amortization was $0.8 million for the first quarter of 2011 and $0.9 million
for the first quarter of 2010. Within our LTL business, depreciation and amortization was $0.4
million during the first quarter of 2011 and $0.5 million during the first quarter of 2010. Within
our TL business, depreciation and amortization within our TL business was $0.3 million during the
first quarter of 2011 and $0.2 million during the first quarter of 2010. Within our TMS business,
depreciation and amortization was $0.2 million during both the first quarter of 2011 and 2010.
Operating Income
Operating income increased by $0.4 million, or 5.6%, to $7.6 million during the first quarter
of 2011 from $7.2 million during the first quarter of 2010. As a percentage of revenues, operating
income decreased to 4.4% during the first quarter of 2011 from 5.0% during the first quarter of
2010.
Within our LTL business, operating income decreased by $0.3 million, or 5.6%, to $4.9 million
from $5.2 million, and also decreased as a percentage of LTL revenues to 4.8% from 5.7%, primarily
as a result from the factors discussed above.
Within our TL business, operating income increased by $1.0 million, or 61.6%, to $2.5 million
from $1.5 million, and also increased as a percentage of TL revenues to 4.6% from 4.0%, primarily
as a result from the factors discussed above.
Within our TMS business, operating income increased by $0.3 million, or 38.6%, to $1.3 million
from $1.0 million, and also increased as a percentage of TMS revenues to 8.0% from 6.9%, primarily
as a result from the factors discussed above.
Interest Expense
Interest expense decreased by $4.2 million, or 89.7%, to $0.5 million during the first quarter
of 2011 from $4.7 million during the first quarter of 2010, primarily attributable to the reduction
of our outstanding indebtedness resulting from the application of the net proceeds from our IPO.
15
Income Tax
Income tax provision was $2.7 million during the first quarter of 2011 compared to $1.0
million during the first quarter of 2010. The effective tax rate was 38.0% during the first
quarter of 2011 compared to 41.4% during the first quarter of 2010. The effective income tax rate
varies from the federal statutory rate of 35.0% primarily due to state and Canadian income taxes as
well as the impact of items causing permanent differences.
Net Income Available to Common Stockholders
Net income available to common stockholders was $4.4 million during the first quarter of 2011
compared to $0.9 million during the first quarter of 2010. In addition the factors discussed above
for operating income net income available to common stockholders during the first quarter of 2011
was impacted by a $4.2 million reduction of interest expense and $1.7 million increase in income
taxes during the first quarter of 2011 compared to the first quarter of 2010.
Liquidity and Capital Resources
Historically, our primary sources of cash have been borrowings under our revolving credit
facility, sale of subordinated notes, equity contributions, and cash flows from operations. Our
primary cash needs are to fund normal working capital requirements, finance capital expenditures,
and repay our indebtedness. As of March 31, 2011, we had $0.5 million in cash and cash
equivalents, $9.1 million of availability under our credit facility, and $49.4 million in net
working capital.
Although we can provide no assurances, amounts available under our credit facility, net cash
provided by operating activities, and available cash and cash equivalents should be adequate to
finance working capital and planned capital expenditures for at least the next twelve months.
Thereafter, we may find it necessary to obtain additional equity or debt financing as we continue
to execute our business strategy.
Our current credit facility consists of a revolving line of credit, up to a maximum aggregate
amount of $55.0 million, of which up to $5.0 million may be used for Swing Line Loans (as defined
in the credit facility agreement) and up to $8.0 million may be used for letters of credit. The
credit facility matures on May 18, 2015.
Advances under our credit facility agreement bear interest at either (a) the Eurocurrency Rate
(as defined in the credit facility agreement), plus an applicable margin in the range of 2.5% to
3.0%, or (b) the Base Rate (as defined in the credit facility agreement), plus an applicable margin
in the range of 1.5% to 2.0%.
Our credit facility agreement requires us to meet financial tests, including a minimum fixed
charge coverage ratio and a maximum cash flow leverage ratio. In addition, our credit facility
agreement contains negative covenants limiting, among other things, additional indebtedness,
capital expenditures, transactions with affiliates, additional liens, sales of assets, dividends,
investments and advances, prepayments of debt, mergers and acquisitions, and other matters
customarily restricted in such agreements. Our credit facility agreement also contains customary
events of default, including payment defaults, breaches of representations and warranties, covenant
defaults, events of bankruptcy and insolvency, failure of any guaranty or security document
supporting the credit agreement to be in full force and effect, and a change of control of our
business. As of March 31, 2011, we were in compliance with all debt covenants.
16
Cash Flows
A summary of operating, investing and financing activities are shown in the following table
(in thousands):
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2011 |
|
|
2010 |
|
Net Cash provided by (used in): |
|
|
|
|
|
|
|
|
Operating activities |
|
$ |
3,143 |
|
|
$ |
3,064 |
|
Investing activities |
|
|
(21,187 |
) |
|
|
(2,253 |
) |
Financing activities |
|
|
17,571 |
|
|
|
99 |
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents |
|
$ |
(473 |
) |
|
$ |
910 |
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities
Cash provided by our operating activities primarily consists of net income adjusted for
certain non-cash items, including depreciation and amortization, deferred interest, share-based
compensation, provision for bad debts, deferred taxes and the effect of changes in working capital
and other activities.
The difference between our $4.4 million net income and the $3.1 million cash provided by
operating activities during the three months ended March 31, 2011 was primarily attributable to a
$6.6 million increase in our accounts receivable and a $1.9 million increase in prepaid expenses
and other assets, partially offset by a $1.7 million increase in accounts payable, $2.1 million
increase in accrued expenses and other liabilities, and a variety of non-cash charges, including
$2.2 million of deferred income taxes, and $0.9 million of depreciation and amortization.
Cash Flows from Investing Activities
Cash used in investing activities was $21.2 million during the three months ended March 31,
2011, which primarily reflects $20.0 million used for our acquisition of Morgan Southern and $1.2
million of capital expenditures made to support our operations.
Cash Flows from Financing Activities
Cash provided by financing activities was $17.6 million during the three months ended March
31, 2011, which primarily reflects net borrowings of $19.1 million under our credit facilities,
payments of $1.7 million for contingent earnouts, proceeds from the issuance of common stock of
$0.3 million relating to employees stock option exercises and payments of $0.1 million for our
capital leases obligations.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires that we make estimates and assumptions. In certain
circumstances, those estimates and assumptions can affect amounts reported in the accompanying
consolidated financial statements and related footnotes. In preparing our financial statements, we
have made our best estimates and judgments of certain amounts included in the financial statements,
giving due consideration to materiality. We base our estimates on historical experience and on
various other assumptions that we believe to be reasonable. Application of the accounting policies
described below involves the exercise of judgment and use of assumptions as to future uncertainties
and, as a result, actual results could differ from these estimates. The following is a brief
discussion of our critical accounting policies and estimates.
17
Goodwill and Other Intangibles
Goodwill represents the excess of purchase price over the estimated fair value assigned to the
net tangible and identifiable intangible assets of a business acquired. Goodwill is tested for
impairment at least annually using a two-step process that begins with an estimation of the fair
value at the reporting unit level. Our reporting units are our operating segments as this is the
lowest level for which discrete financial information is prepared and regularly reviewed by
management. The impairment test for goodwill involves comparing the fair value of a reporting unit
to its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds
its fair value, a second step is required to measure the goodwill impairment loss. The second step
includes hypothetically valuing all the tangible and intangible assets of the reporting unit as if
the reporting unit had been acquired in a business combination. Then, the implied fair value of
the reporting units goodwill is compared to the carrying amount of that goodwill. If the carrying
amount of the reporting units goodwill exceeds the implied fair value of the goodwill, we
recognize an impairment loss in an amount equal to the excess, not to exceed the carrying amount.
For purposes of our impairment test, the fair value of our reporting units are calculated based
upon an average of an income fair value approach and market fair value approach.
Other intangible assets recorded consist of definite lived customer relationships. We
evaluate our other intangible assets for impairment when current facts or circumstances indicate
that the carrying value of the assets to be held and used may not be recoverable.
Income Taxes
Income taxes are accounted for under the asset and liability method. Under this method,
deferred tax assets and liabilities are recognized for the future tax consequences attributable to
differences between the financial reporting basis and the tax basis of assets and liabilities at
enacted tax rates expected to be in effect when such amounts are recovered or settled. The use of
estimates by management is required to determine income tax expense, deferred tax assets and any
related valuation allowance and deferred tax liabilities. The determination of a valuation
allowance is based on estimates of future taxable income by jurisdiction in which the deferred tax
assets will be recoverable. In making such a determination, all available positive and negative
evidence, scheduled reversals of deferred tax liabilities, projected future taxable income, tax
planning strategies and recent financial operations, is considered. When evaluating the need for a
valuation allowance as of December 31, 2010, we considered that we achieved cumulative net income
before provision for income taxes for the most recent two years. Further, we achieved cost savings
from a reduction of interest expense related to the IPO that will further increase our ability to
realize the benefits of the net operating loss carry forwards. The tax deductibility of the
goodwill related to our acquisitions will reduce taxable income in future years. We estimate that
we will utilize all existing net operating losses carry forwards before their expiration. These
estimates can be affected by a number of factors, including possible tax audits or general economic
conditions or competitive pressures that could affect future taxable income. Although management
believes that the estimates are reasonable, the deferred tax asset and any related valuation
allowance will need to be adjusted if managements estimates of future taxable income differ from
actual taxable income. An adjustment to the deferred tax asset and any related valuation allowance
could materially impact the consolidated results of operations. At March 31, 2011 and December 31,
2010, there was no valuation allowance recorded.
At December 31, 2010 we had $41.6 million of gross federal net operating losses which are
available to reduce federal income taxes in future years and expire in the years 2025 through 2029.
We are subject to federal and state tax examinations for all tax years subsequent to December 31,
2005. Although the pre-2006 years are no longer subject to examinations by the Internal Revenue
Service and various state taxing authorities, NOL carryforwards generated in those years may still
be adjusted upon examination by the IRS or state taxing authorities if they have been or will be
used in the future.
Revenue Recognition
LTL revenue is recorded when all of the following have occurred: an agreement of sale exists;
pricing is fixed or determinable; and collection of revenue is reasonably assured. We use a
percentage of completion method to recognize revenue, which results in an allocation of revenue
between reporting periods based on the distinctive phases of each LTL transaction completed in each
reporting period, with expenses recognized as incurred. Management believes that this is the most
appropriate method for LTL revenue recognition based on the multiple distinct phases of a typical
LTL transaction, which is in contrast to the single phase of a typical TL transaction.
18
TL revenue is recorded when all of the following have occurred: an agreement of sale exists;
pricing is fixed or determinable; delivery has occurred; and our obligation to fulfill a
transaction is complete and collection of revenue is reasonable assured. This occurs when we
complete the delivery of a shipment.
TMS transportation revenue and related transportation costs are recognized when the shipment
has been delivered by a third-party carrier. Fee for services revenue is recognized when the
services have been rendered. At the time of delivery or rendering of services, as applicable, our
obligation to fulfill a transaction is complete and collection of revenue is reasonably assured.
We offer volume discounts to certain customers. Revenue is reduced as discounts are earned.
We typically recognize revenue on a gross basis, as opposed to a net basis, because we bear
the risks and benefits associated with revenue-generated activities by, among other things, (1)
acting as a principal in the transaction, (2) establishing prices, (3) managing all aspects of the
shipping process, and (4) taking the risk of loss for collection, delivery and returns. Certain
TMS transactions to provide specific services are recorded at the net amount charged to the client
due to the following factors: (A) we do not have latitude in establishing pricing, and (B) we do
not bear the risk of loss for delivery and returns; these items are the risk of the carrier.
|
|
|
ITEM 3. |
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Commodity Risk
In our LTL, TL, and TMS businesses, our primary market risk centers on fluctuations in fuel
prices, which can affect our profitability. Diesel fuel prices fluctuate significantly due to
economic, political, and other factors beyond our control. Our ICs and purchased power providers
pass along the cost of diesel fuel to us, and we in turn attempt to pass along some or all of these
costs to our customers through fuel surcharge revenue programs. There can be no assurance that our
fuel surcharge revenue programs will be effective in the future. Market pressures may limit our
ability to pass along our fuel surcharges.
Interest Rate Risk
We have exposure to changes in interest rates on our revolving credit facility. The interest
rate on our revolving credit facility fluctuates based on the base rate or Eurocurrency rate plus
an applicable margin. Assuming our $55.0 million revolving credit facility was fully drawn, a 1.0%
increase in the borrowing rate would increase our annual interest expense by $0.5 million. We do
not use derivative financial instruments for speculative trading purposes and are not engaged in
any interest rate swap agreements.
|
|
|
ITEM 4. |
|
CONTROLS AND PROCEDURES |
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial
Officer, conducted an evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act).
Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that,
as of March 31, 2011, our disclosure controls and procedures (as defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act) were effective to ensure that information required to be
disclosed by us in the reports we file or submit under the Exchange Act is (i) recorded, processed,
summarized, and reported within the time periods specified in the SEC rules and forms, and (ii) is
accumulated and communicated to our management, including our Chief Executive Officer and Chief
Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There was no change in our internal control over financial reporting during our most recent
fiscal quarter that has materially affected, or is reasonably likely to materially affect, our
internal control over financial reporting.
19
Inherent Limitations on Effectiveness of Controls
Our management, including our Chief Executive Officer and Chief Financial Officer, does not
expect that our disclosure controls and procedures or our internal controls over financial
reporting will prevent all error and all fraud. A control system, no matter how well conceived and
operated, can provide only reasonable, not absolute, assurance that the objectives of the control
system are met. Further, the design of a control system must reflect the fact that there are
resource constraints, and the benefits of controls must be considered relative to their costs.
Because of the inherent limitations in all control systems, no evaluation of controls can provide
absolute assurance that all control issues, misstatements, errors, and instances of fraud, if any,
within our company have been or will be prevented or detected. These inherent limitations include
the realities that judgments in decision-making can be faulty and that breakdowns can occur because
of simple error or mistake. Controls also can be circumvented by the individual acts of some
persons, by collusion of two or more people, or by management override of the controls. The design
of any system of controls is based in part on certain assumptions about the likelihood of future
events, and there can be no assurance that any design will succeed in achieving its stated goals
under all potential future conditions. Projections of any evaluation of controls effectiveness to
future periods are subject to risks. Over time, internal controls may become inadequate as a
result of changes in conditions, or through the deterioration of the degree of compliance with
policies or procedures.
20
PART II OTHER INFORMATION
|
|
|
ITEM 1. |
|
LEGAL PROCEEDINGS. |
From time to time, we are involved in litigation and proceedings in the ordinary course of our
business. We are not currently involved in any legal proceeding that we believe would have a
material adverse effect on our business or financial condition.
An investment in our common stock involves a high degree of risk. You should carefully
consider the factors described in our 10-K filed with the SEC on March 31, 2011 in analyzing an
investment in our common stock. If any of such risks occur, our business, financial condition, and
results of operations would likely suffer, the trading price of our common stock could fall, and
you could lose all or part of the money you paid for our common stock.
In addition, the risk factors and uncertainties could cause our actual results to differ
materially from those projected in our forward-looking statements, whether made in this report or
other documents we file with the SEC, or our annual or quarterly reports to stockholders, future
press releases, or orally, whether in presentations, responses to questions, or otherwise.
|
|
|
|
|
|
31.1 |
|
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer |
|
|
|
|
|
|
31.2 |
|
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer |
|
|
|
|
|
|
32.1 |
|
|
Section 1350 Certification of Chief Executive Officer |
|
|
|
|
|
|
32.2 |
|
|
Section 1350 Certification of Chief Financial Officer |
21
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
|
|
|
Roadrunner Transportation Systems, Inc.
|
|
Date: May 13, 2011 |
By: |
/s/ Mark A. DiBlasi
|
|
|
|
Name: |
Mark A. DiBlasi |
|
|
|
Title: |
President and Chief Executive Officer |
|
|
|
|
|
Date: May 13, 2011 |
By: |
/s/ Peter R. Armbruster
|
|
|
|
Name: |
Peter R. Armbruster |
|
|
|
Title: |
Vice President Finance,
Chief Financial Officer,
Secretary, and Treasurer |
|
|
22