PACR Earnings....
Pacer International Reports Second Quarter 2009 Results
4:17p ET August 5, 2009 (Business Wire)
Pacer International, Inc. (Nasdaq: PACR), a leading North American freight transportation and logistics services provider, today reported financial results for the three- and six-month periods ended June 30, 2009.
SECOND QUARTER RESULTS
Revenues decreased $139.9 million to $376.7 million compared to $516.6 million for the quarter ended June 27, 2008.
Income from operations declined $34.7 million to a loss of $11.8 million compared to an income of $22.9 million in the 2008 quarter.
Net income declined from $13.4 million in the 2008 quarter to a net loss of $7.3 million in the 2009 quarter.
During the quarter the company entered into an amendment to its credit agreement which, among other things, waived compliance with the leverage ratio covenant for the second quarter through August 31, 2009, and also received $22.5 million from SAP America, Inc. as part of an amendment to the software license agreement with SAP.
Intermodal segment income from operations decreased $37.3 million from the 2008 quarter to a loss of $5.7 million compared to an operating income of $31.6 million in the 2008 quarter. Volumes showed improvement from the first quarter of 2009, but are still below the 2008 quarter.
Logistics segment income from operations improved by $0.3 million to a loss of $1.4 million compared to a loss of $1.7 million in the 2008 quarter. Increased warehousing business and reduced truck services losses were the main contributors.
Corporate costs for the 2009 quarter were $2.3 million less than the 2008 quarter principally due to the lack of a performance incentive accrual in the 2009 quarter.
Sale of Truck Services - On July 24, 2009, the company entered into an agreement with Universal Truckload Services, Inc. and UTS Leasing, Inc. to sell certain assets of its truck services business. The completion of the transaction is subject to customary closing conditions and is expected to occur in August 2009.
"While demand and economic conditions in general remained very difficult leading to a second quarter loss, there were some positive signs that our business levels were stabilizing and even improving in some key areas during the quarter," said Brian C. Kane, Chief Financial Officer of Pacer. "We continue to take the steps necessary to reduce our costs to benchmark competitive levels and provide the financial resources needed to position Pacer for future growth. Operating cash flows were much improved for the second quarter compared to the first quarter, and we anticipate returning to positive cash flow and earnings during the second half of 2009."
"Additional organizational simplification and workforce reduction initiatives were implemented during the quarter moving Pacer significantly closer to the organizational integration, process improvement, and cost reduction goals we have established," added Michael E. Uremovich, Chairman and CEO of Pacer. "We are continuing to implement a number of key initiatives supporting these goals, including actions that will further integrate our Cartage and Intermodal Operations teams that will result in improved door-to-door service delivery while reducing costs through increased density and improved driver coordination."
"Though these remain extremely challenging times, we are very encouraged with the progress of our organizational improvement initiatives. Also encouraging is the number of new customers and new business opportunities with existing customers that we are winning, particularly in our retail intermodal services area where both volume and market share improved year-over-year in the second quarter."
YEAR-TO-DATE RESULTS
Revenues for the six months ended June 30, 2009 decreased $284.1 million to $735.3 million compared to $1,019.4 million for the six months ended June 27, 2008.
Income from operations, which includes a $200.4 million pre-tax, non-cash goodwill impairment charge (of which $31.4 million related to our logistics segment and $169.0 million related to our intermodal segment), was a loss of $234.9 million compared to income of $46.0 million in the 2008 period. Excluding the first quarter impairment charge, income from operations was a loss of $34.5 million.
Net income declined from $26.8 million in the 2008 period to a net loss of $184.7 million in the 2009 period. Net income includes the impact of the goodwill impairment charge ($162.1 million after-tax, or $4.67 per share). Excluding the impairment charge, net income was a loss of $22.6 million, or $0.65 per diluted share.
Intermodal segment income from operations decreased $251.4 million from the 2008 period to a loss of $189.4 million (including a $169.0 million goodwill impairment charge) compared to an operating income of $62.0 million in the 2008 period. Excluding the impairment charge, the intermodal segment recorded a $20.4 million operating loss.
Logistics segment income from operations decreased $33.6 million to a loss of $36.1 million (including a $31.4 million goodwill impairment charge) compared to a loss of $2.5 million in the 2008 period. Excluding the impairment charge, the logistics segment recorded a $4.7 million operating loss.
Corporate costs for the 2009 period were $4.1 million less than the 2008 period principally due to the lack of a performance incentive accrual in the 2009 period.
Note: A tabular reconciliation detailing the adjustments made to arrive at the adjusted financial results set forth above and elsewhere in this press release from financial results determined in accordance with accounting principles generally accepted in the United States of America ("GAAP") is contained in the financial summary statements attached to this press release.
