Roadrunner Transportation Systems Reports 2012 Fourth Quarter and Year-End Results and Announces First Quarter 2013 Guidance Business Wire CUDAHY, Wis. -- February 6, 2013 Roadrunner Transportation Systems, Inc. (NYSE: RRTS), a leading asset-light transportation and logistics service provider, today reported financial results for the three and twelve months ended December31, 2012. Roadrunner's summary financial results for the three and twelve months ended December31 are highlighted below. Fourth quarter 2012 net income available to common stockholders increased 38.8% over the prior year quarter to $9.5 million. Fourth quarter 2012 diluted income per share available to common stockholders increased 31.8% over the prior year quarter to $0.29. Three Months Ended Twelve Months Ended (In thousands, except December 31, December 31, per share data) 2012 2011 2012 2011 Total revenues $ 295,069 $ 238,005 $ 1,073,354 $ 843,627 Net revenues (total revenues less $ 90,558 $ 69,948 $ 319,895 $ 223,284 purchased transportation costs) Depreciation and 2,990 1,597 9,499 4,978 amortization Other operating 69,751 54,646 240,673 170,803 expenses Acquisition 85 430 773 1,368 transaction expenses Operating income $ 17,732 $ 13,275 $ 68,950 $ 46,135 Net income available 9,527 6,865 37,530 25,871 to common stockholders Weighted average diluted shares 33,101 31,765 32,425 31,545 outstanding Diluted income per share available to $ 0.29 $ 0.22 $ 1.16 $ 0.82 common stockholders 2012 Fourth Quarter and Year-end Results In discussing the company's fourth quarter performance, Mark DiBlasi, President and CEO of Roadrunner, said, “Strong performance across all of our business segments generated fourth quarter revenue growth of 24.0% and net revenue growth of 29.5%. Due to sales and operational initiatives, our operating income growth of 33.6% outpaced revenue. Our operating ratio improved 40 basis points to 94.0% compared to 94.4% in the fourth quarter of 2011, despite additional costs incurred related to Hurricane Sandy. The impact of additional shares related to our December common stock offering, lost revenue and additional costs incurred related to Hurricane Sandy, and transaction costs related to the fourth quarter acquisitions of Central Cal Transportation (Central Cal), A&A Express (A&A) and Direct Connection Transportation (DCT) negatively impacted our fourth quarter diluted earnings per share by approximately $0.02. “Our LTL operating ratio improved to 94.9% in the fourth quarter of 2012 from 95.5% in the fourth quarter of 2011. Our continued initiatives to expand into new geographic regions, build density, improve pricing and enhance productivity, as well as the addition of Expedited Freight Systems (EFS) in August 2012, resulted in a net revenue margin improvement from 24.8% in the fourth quarter of 2011 to 28.1% in the fourth quarter of 2012. We are pleased with the improvement in our operating ratio over last year, despite experiencing load inefficiencies due to Hurricane Sandy and incurring integration costs on a non-recurring basis associated with the consolidation of certain EFS operations. “Our continued performance initiatives, as well as improvement in our insurance claims experience led to our TL operating ratio improving sequentially to 92.8% in the fourth quarter 2012 from 94.1% in the third quarter of 2012. TL revenues grew by $44.7 million, or 45.3%, from the prior year quarter. Incremental revenues from our 2012 acquisitions accounted for $34.3 million of the increase, with the balance of $10.4 million representing organic growth of 10.5%. The positive impact of the acquisitions and operating leverage associated with our revenue growth led to a 33.9% increase in our TL operating income quarter-over-quarter. “TMS revenue grew $1.8 million, or 8.3%, in the fourth quarter of 2012 from the prior year quarter. Organic growth, pricing and our late February 2012 acquisition of Capital Transportation Logistics accounted for the 8.3% increase. The operating leverage associated with this growth led to a 29.6% increase in TMS operating income quarter-over-quarter. Our TMS operating ratio improved to 88.2% compared to 90.1% in the fourth quarter of 2011. "Overall, we are extremely pleased with our 2012 performance. In 2012, total company revenue increased 27.2% to $1,073.4 million from $843.6 million in 2011. This revenue growth was a combination of both organic- and acquisition-related growth. Our total company operating income increased 49.5% to $69.0 million in 2012 from $46.1 million in 2011. Our total company operating ratio improved to 93.6% in 2012 from 94.5% in 2011. Finally, our diluted income per share available to common stockholders increased 41.5% to $1.16 in 2012 from $0.82 in 2011." 2013 First Quarter Guidance In commenting on guidance for the first quarter of 2013, Peter Armbruster, CFO of Roadrunner, said, “We anticipate our revenues for the first quarter to be in the range of $285 million to $310 million, representing an increase of 20% to 31% from the first quarter of 2012. Further, we expect diluted income per share available to common stockholders to be between $0.27 and $0.29, compared to diluted income per share available to common stockholders of $0.25 in the prior year quarter. The impact on diluted income per share from our December 2012 stock offering of 3,925,000 shares will be approximately $0.03 between years. On an adjusted basis, our diluted income per share guidance of $0.27 to $0.29 represents an increase of 23% to 32% from the first quarter of 2012 diluted income per share of $0.22. 2012 Fourth Quarter Segment Information Roadrunner has three operating segments: less-than-truckload (LTL), truckload and logistics (TL) and transportation management solutions (TMS). The following highlights exclude intercompany eliminations and corporate expenses. LTL revenues, including fuel, increased 9.6% to $129.9 million for the fourth quarter of 2012 from $118.5 million for the fourth quarter of 2011. LTL net revenues for the fourth quarter of 2012 were $36.4 million, or 28.1% of LTL revenues, compared to $29.4 million, or 24.8% of LTL revenues, for the fourth quarter of 2011. LTL operating income was $6.6 million, or 5.1% of LTL revenues, for the fourth quarter of 2012 compared to $5.3 million, or 4.5% of LTL revenues, for the fourth quarter of 2011. Summary LTL operating statistics for the three and twelve months ended December31 are shown below. Three Months Ended Twelve Months Ended December 31, December 31, 2012 2011 % 2012 2011 % Change Change Operating 94.9 95.5 93.1 94.8 ratio Tonnage (in thousands of 354.3 306.8 15.5 % 1,368.0 1,256.3 8.9 % tons) Shipments (in 540.4 471.4 14.6 % 2,090.4 1,905.9 9.7 % thousands) Revenue per hundredweight $ 17.92 $ 18.81 (4.7 %) $ 18.46 $ 18.27 1.0 % (incl. fuel) Revenue per hundredweight $ 14.61 $ 15.42 (5.3 %) $ 15.08 $ 15.00 0.5 % (excl. fuel) Weight per shipment 1,311 1,302 0.7 % 1,309 1,318 (0.7 %) (lbs.) Linehaul cost per mile $ 1.24 $ 1.24 0.0 % $ 1.24 $ 1.24 0.0 % (excl. fuel) Note: Other than operating ratio, the statistics above do not include (i) adjustments for undelivered freight required for financial statement purposes in accordance with Roadrunner's revenue recognition policy; and (ii) non-LTL related business captured within the LTL segment. Operating statistics include EFS beginning as of the date of acquisition, August 10, 2012. TL revenues increased 45.3% to $143.4 million for the fourth quarter of 2012 from $98.7 million for the fourth quarter of 2011. The improvement was primarily due to increases in market pricing and load growth, increased utilization of Roadrunner's TL brokerage agent network, and the acquisitions of D&E Transport, CTW Transport, R&M/Sortino, Central Cal, A&A and DCT. For the fourth quarter, these acquisitions collectively contributed incremental TL revenues of $34.3 million. Overall, TL net revenues for the fourth quarter of 2012 were $47.2 million, or 32.9% of TL revenues, compared to $34.8 million, or 35.3% of TL revenues, for the fourth quarter of 2011. TL operating income was $10.3 million, or 7.2% of TL revenues, for the fourth quarter of 2012 compared to $7.7 million, or 7.8% of TL revenues, for the fourth quarter of 2011. TMS revenues for the fourth quarter of 2012 increased 8.3% to $23.8 million from $22.0 million for the fourth quarter of 2011. TMS net revenues for the fourth quarter of 2012 were $6.9 million, or 29.1% of TMS revenues, compared to $5.7 million, or 26.0% of TMS revenues, for the fourth quarter of 2011. TMS revenue growth during the quarter was primarily attributable to new and existing customer growth and the acquisition of Capital Transportation Logistics. TMS operating income was $2.8 million, or 11.8% of TMS revenues, for the fourth quarter of 2012, compared to $2.2 million, or 9.9% of TMS revenues, for the fourth quarter of 2011. Conference Call A conference call is scheduled for Wednesday, February6, 2013 at 4:30 p.m. Eastern Time. To access the conference call, please dial 866-383-8003 (U.S.) or 617-597-5330 (International) approximately 10 minutes prior to the start of the call. Callers will be prompted for passcode 64552489. The conference call will also be available via live webcast under the Investor Relations section of Roadrunner's website, www.rrts.com. If you are unable to listen to the live call, a replay will be available through February13, 2013, and can be accessed by dialing 888-286-8010 (U.S.) or 617-801-6888 (International). Callers will be prompted for passcode 66287729. An archived version of the webcast will also be available under the Investor Relations section of Roadrunner's website, www.rrts.com. About Roadrunner Transportation Systems, Inc. Roadrunner is a leading asset-light transportation and logistics service provider offering a full suite of solutions, including customized and expedited less-than-truckload, truckload and logistics, transportation management solutions, intermodal solutions, and domestic and international air. For more information, please visit Roadrunner's website, www.rrts.com. Safe Harbor Statement This release contains forward-looking statements that relate to future events or performance, including statements regarding Roadrunner's performance, Roadrunner's sales and operational initiatives, Roadrunner's initiatives to expand into new geographic regions, build density, improve pricing and enhance productivity, the impact of Roadrunner's December 2012 stock offering, the impact of Hurricane Sandy, Roadrunner's acquisitions, and Roadrunner's expected revenues and diluted earnings per share available to common stockholders for the first quarter of 2013. These statements reflect Roadrunner's current expectations, and Roadrunner does not undertake to update or revise these forward-looking statements, even if experience or future changes make it clear that any projected results expressed or implied in this or other company statements will not be realized. Furthermore, readers are cautioned that these statements involve risks and uncertainties, many of which are beyond Roadrunner's control, which could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties include, but are not limited to, risks related to the integration of acquired companies, competition in the transportation industry, the impact of the current economic environment, Roadrunner's dependence upon purchased power, the unpredictability of and potential fluctuation in the price and availability of fuel, the effects of governmental and environmental regulations, insurance in excess of prior experience levels, and other "Risk Factors" set forth in Roadrunner's most recent SEC filings. (Tables Follow) ROADRUNNER TRANSPORTATION SYSTEMS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, December 31, 2012 2011 2012 2011 Revenues $ 295,069 $ 238,005 $ 1,073,354 $ 843,627 Operating expenses: Purchased 204,511 168,057 753,459 620,343 transportation costs Personnel and related 33,928 25,522 119,955 87,178 benefits Other operating 35,823 29,124 120,718 83,625 expenses Depreciation and 2,990 1,597 9,499 4,978 amortization Acquisition 85 430 773 1,368 transaction expenses Total operating 277,337 224,730 1,004,404 797,492 expenses Operating income 17,732 13,275 68,950 46,135 Interest expense: Interest on long-term 2,169 2,079 7,981 4,135 debt Dividends on preferred stock subject to — 50 49 200 mandatory redemption Total interest expense 2,169 2,129 8,030 4,335 Income before provision for income 15,563 11,146 60,920 41,800 taxes Provision for income 6,036 4,281 23,390 15,929 taxes Net income available $ 9,527 $ 6,865 $ 37,530 $ 25,871 to common stockholders Earnings per share available to common stockholders: Basic $ 0.30 $ 0.22 $ 1.21 $ 0.85 Diluted $ 0.29 $ 0.22 $ 1.16 $ 0.82 Weighted average common stock outstanding: Basic 31,732 30,706 31,040 30,432 Diluted 33,101 31,765 32,425 31,545 ROADRUNNER TRANSPORTATION SYSTEMS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands) December 31, December 31, 2012 2011 ASSETS Current assets: Cash and cash equivalents $ 11,908 $ 3,315 Accounts receivable, net of allowances of $1,490 122,947 102,358 and $1,461, respectively Deferred income taxes 3,800 9,497 Prepaid expenses and other current assets 26,461 16,400 Total current assets 165,116 131,570 Property and equipment, net of accumulated depreciation of $20,100 and $13,303, 68,576 28,447 respectively Other assets: Goodwill 442,143 364,687 Intangible assets, net 12,710 10,381 Other noncurrent assets 12,263 8,633 Total other assets 467,116 383,701 Total assets $ 700,808 $ 543,718 LIABILITIES AND STOCKHOLDERS’ INVESTMENT Current liabilities: Current maturities of long-term debt $ 17,000 $ 14,000 Accounts payable 54,887 50,245 Accrued expenses and other liabilities 29,132 19,480 Preferred stock subject to mandatory redemption — 5,000 Total current liabilities 101,019 88,725 Long-term debt, net of current maturities 144,500 122,500 Other long-term liabilities 63,210 36,540 Total liabilities 308,729 247,765 Stockholders’ investment: Common stock $.01 par value; 100,000 shares authorized; 34,371 and 30,707 shares issued and 344 307 outstanding Additional paid-in capital 325,034 266,475 Retained earnings 66,701 29,171 Total stockholders’ investment 392,079 295,953 Total liabilities and stockholders’ investment $ 700,808 $ 543,718 Contact: Roadrunner Transportation Systems, Inc. Peter Armbruster, 414-615-1648 Chief Financial Officer or Vollrath Associates, Inc. Marilyn Vollrath, 414-221-0210 firstname.lastname@example.org
Roadrunner Transportation Systems Reports 2012 Fourth Quarter and Year-End Results and Announces First Quarter 2013 Guidance
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