TRBR Trailer Bridge, Inc. (MM)

Trailer Bridge, Inc. (NASDAQ Global Market: TRBR) today announced unaudited financial results for its first quarter ended March 31, 2011 (see attached tables).

Operational Review The Company's deployed vessel capacity utilization during the first quarter was 88.8% southbound and 22.6% northbound, compared to 96.5% and 30.2%, respectively, during the first quarter of 2010, and 97.5% and 22.2%, respectively, sequentially from the fourth quarter of 2010.

Completion of Two Ro/Ro Vessel Five-Year Regulatory Dry Docking / Resumes Weekly Service During the first quarter, each of the Company’s two roll-on, roll-off vessels was sequentially out of service as work related to five-year regulatory requirements was being performed. The Company resumed its regular deployment in late April. Trailer Bridge incurred $6.6 million of expense in the first quarter of 2011 related to the dry-docking of this vessel as compared to $445,000 in the fourth quarter of 2010 and no such expense in the prior year period.

First Quarter Financial Review

• The Company had revenue of $24.8 million during the quarter, compared to $28.8 million in the prior year. Charter revenues were lower during the period at $50,000, compared to $1.3 million in the prior year period, and lower by $0.05 million sequentially from the fourth quarter of 2010.
• The Company reported an operating loss of $8.0 million in the first quarter of 2011, including dry-docking expenses of $6.6 million, compared to operating income of $2.2 million in the prior year period and an operating loss of $0.4 million in the fourth quarter of 2010.
• Net loss for the first quarter of 2011 was $10.4 million, or $0.86 per basic and diluted share, compared to a net loss of $0.3 million, or $0.03 per basic and diluted share, in the prior-year period. Increased fuel prices drove the net fuel expense to $2.7 million, up $1.2 million over the prior period. Adjusted EBITDA, as detailed in the accompanying table, was $0.4 million in the first quarter of 2011.

Refinancing Status The Company’s previously discussed refinancing effort has not come to completion. The Company continues actively working with interested lenders and its advisors to refinance the $82.5 million in public notes due in November 2011. The Company is exploring a number of options and might involve the private or public lending market and may include an equity component. The interest rate the Company pays on its overall debt may be higher under such refinancing than previously anticipated.

Financial Position At March 31, 2011, the Company had cash balances of $3.1 million and working capital deficit of $83.1 million due to the inclusion of the $82.5 million in Notes due in November 2011. As of March 31, 2011, the Company had no outstanding amount on its $10.0 million revolving credit facility, and, based upon eligible receivables, had $6.6 million of availability under this facility. During the twelve months ended March 31, 2011, net cash used in operating activities was $5.6 million.

Conference Call The Company will discuss these results in a conference call on Monday, May 16, 2011 at 10:00 AM ET.

Participant Dial-In Numbers:

(In the United States):   877-407-9210 (International): 201-689-8049  

Webcast The call will also be simultaneously broadcast over the Internet. To listen to the live webcast, please go to www.trailerbridge.com and click on the conference call link, or go directly to: http://www.investorcalendar.com/IC/CEPage.asp?ID=164285

 

Phone Replay Information A recorded replay of the call will be available until May 23, 2011. Listeners may dial:

(In the United States):

  877-660-6853

(International):

  201-612-7415

  The following replay passcodes are both required for playback: Account #: 286 Conference ID #: 371511  

About Trailer Bridge, Inc. Trailer Bridge provides integrated trucking and marine freight service to and from all points in the lower 48 states and Puerto Rico and Dominican Republic, bringing efficiency, service, security and environmental and safety benefits to domestic cargo in that traffic lane. This total transportation system utilizes its own trucks, drivers, trailers, containers and U.S. flag vessels to link the mainland with Puerto Rico via marine facilities in Jacksonville, San Juan and Puerto Plata. Additional information on Trailer Bridge is available at the www.trailerbridge.com website.

This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The matters discussed in this press release include statements regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to the future operating performance of the Company and its asset utilization. Investors are cautioned that any such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those in the forward looking statements as a result of various factors. Without limitation, these risks and uncertainties include the risks of changes in demand for transportation services offered by the Company, the Company’s ability to refinance its existing maturing debt, maintenance of its revolving credit facility, changes in rate levels for transportation services offered by the Company, changes in the cost of fuel, unfavorable outcomes from the United States Department of Justice (“DOJ”) investigation and related class or individual actions, economic recessions, de-listing from the Nasdaq stock exchange, equipment and driver condition and availability and severe weather as well the ability to retain and/or attract the necessary personnel and maintain necessary vendor relationships.

   

TRAILER BRIDGE, INC.

CONDENSED STATEMENTS OF OPERATIONS

(unaudited)

      Three Months Ended March 31, 2011     2010 OPERATING REVENUES $ 24,813,947 $ 28,844,964 OPERATING EXPENSES: Salaries, wages, and benefits 3,512,894 4,039,755 Purchased transportation and other rent 7,270,339 7,175,202 Fuel 5,077,919 4,293,654

Operating and maintenance (exclusive of depreciation & dry-docking shown separately below)

6,305,477 6,558,082 Dry-Docking 6,610,263 - Taxes and licenses 138,299 178,824 Insurance and claims 768,314 771,933 Communications and utilities 185,570 171,789 Depreciation and amortization 1,563,025 1,540,742 (Gain) loss on sale of property & equipment (778 ) 21,344 Other operating expenses   1,397,767     1,862,933     32,829,089     26,614,258   OPERATING (LOSS) INCOME (8,015,142 ) 2,230,706   NONOPERATING (EXPENSE) INCOME: Interest expense (2,368,980 ) (2,535,191 ) Interest income   1,444         4,386     LOSS BEFORE PROVISION FOR INCOME TAXES (10,382,678 ) (300,099 )   PROVISION FOR INCOME TAXES (7,200 ) (7,470 )     NET LOSS $ (10,389,878 ) $ (307,569 )   PER SHARE AMOUNTS:   NET LOSS PER SHARE BASIC $ (0.86 ) $ (0.03 ) NET LOSS PER SHARE DILUTED $ (0.86 ) $ (0.03 )   WEIGHTED AVERAGE SHARES OUTSTANDING BASIC AND DILUTED   12,016,681     12,013,788      

TRAILER BRIDGE, INC.

CONDENSED BALANCE SHEETS

          March 31, December 31, 2011 2010 (uaudited) ASSETS Current Assets: Cash and cash equivalents $ 3,125,474 $ 11,481,965 Trade receivables, less allowance for doubtful accounts of $982,843 and $1,065,955 13,825,733 13,022,057 Prepaid and other current assets 2,558,185 2,397,948 Deferred income taxes, net   225,645     225,645   Total current assets 19,735,037 27,127,615   Property and equipment, net 82,774,629 82,631,050 Reserve fund for long-term debt 4,639,479 4,638,215 Other assets   1,961,541     2,004,426   TOTAL ASSETS $ 109,110,686   $ 116,401,306     LIABILITIES AND STOCKHOLDERS' DEFICIT Current Liabilities: Accounts payable $ 6,488,774 $ 7,411,181 Accrued liabilities 9,930,236 4,725,030 Unearned revenue 1,023,315 1,410,963 Current portion of long-term debt   85,374,700     85,374,700   Total current liabilities 102,817,025 98,921,874   Long-term debt, less current portion   16,774,927     17,795,827   TOTAL LIABILITIES   119,591,952     116,717,701     Commitments and Contingencies   Stockholders' Deficit: Preferred stock, $.01 par value, 1,000,000, shares authorized; no shares issued or outstanding - - Common stock, $.01 par value, 20,000,000 shares authorized; 12,102,587 shares issued; 12,016,681 shares outstanding at March 31, 2011 and December 31, 2010 121,026 121,026 Treasury stock, at cost, 85,906 shares at March 31, 2011 and December 31, 2010 (318,140 ) (318,140 ) Additional paid-in capital 54,838,650 54,613,643 Capital deficit   (65,122,802 )   (54,732,924 ) TOTAL STOCKHOLDERS' DEFICIT   (10,481,266 )   (316,395 ) TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 109,110,686   $ 116,401,306              

TRAILER BRIDGE, INC.

CONDENSED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31,

  2011 2010 (unaudited) (unaudited) Operating activities: Net loss $ (10,389,878 ) $ (307,569 ) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Depreciation and amortization 1,563,025 1,540,742 Amortization of loan costs 234,739 236,334 Non-cash stock compensation expense 225,007 226,071 Provision for doubtful accounts 114,734 194,024 (Gain) loss on sale of property and equipment (778 ) 21,344 (Increase) decrease in: Trade receivables (918,411 ) (2,179,429 ) Prepaid and other current assets (160,237 ) 486,778 Other assets (199,153 ) 3,392 (Decrease) increase in: Accounts payable (922,407 ) 870,140 Accrued liabilities 5,205,206 1,908,706 Unearned revenue (387,648 ) 115,567     Net cash (used in) provided by operating activities   (5,635,801 )   3,116,100     Investing activities: Purchases of property and equipment (1,712,335 ) (290,660 ) Proceeds from sale of property and equipment 12,546 46,600 Additions to other assets   -     (385,999 ) Net cash used in investing activities   (1,699,789 )   (630,059 )   Financing activities: Exercise of stock options - 12,999 Principal payments on notes payable   (1,020,901 )   (2,037,346 ) Net cash used in financing activities   (1,020,901 )   (2,024,347 )   Net (decrease) increase in cash and cash equivalents (8,356,491 ) 461,694 Cash and cash equivalents, beginning of the period   11,481,965     10,987,379     Cash and cash equivalents, end of period $ 3,125,474   $ 11,449,073     Supplemental cashflow information: Cash paid for interest $ 738,756   $ 921,887      

TRAILER BRIDGE, INC.

RECONCILIATION OF GAAP NET LOSS, TO EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION &

AMORTIZATION; AND ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION &

AMORTIZATION (1)

(UNAUDITED)

      Three months ended Three months ended March 31, 2011 March 31, 2010   GAAP, Net loss $ (10,389,878 ) $ (307,569 ) Net interest expense 2,367,536 2,530,805 Depreciation and amortization 1,563,025 1,540,742 Provision for income taxes   7,200       7,470   Non-GAAP, EBITDA $ (6,452,117 )   $ 3,771,448   Adjustments: Dry-docking 6,610,263 - Stock compensation 225,007 226,071 Anti-trust related legal expense 25,260 379,902 (Gain) loss on asset sales   (778 )     21,344   Total Adjustments   6,859,752       627,317   Non-GAAP, Adjusted EBITDA $ 407,635     $ 4,398,765     Other financial measures: EBITDA margin (26.0 )% 13.1 % Adjusted EBITDA margin 1.6 % 15.2 % Net debt to adjusted EBITDA

7.9

x

3.9

x

Adjusted EBITDA to interest expense

0.2

x

1.7

x

 

Use of Non-GAAP measures

(1) The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). The Company also believes that the presentation of certain non-GAAP measures, i.e., results excluding certain costs and expenses, provides useful information for the understanding of its ongoing operations and enables investors to focus on comparisons of operating performance from period to period without the impact of significant special items. Non-GAAP measures are reconciled in the accompanying financial table. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for the Company’s reported GAAP results.

Adjusted EBITDA is calculated by adding back legal expenses associated with the anti-trust litigation, dry-docking, non-cash compensation charges, and loss/gain on asset sales. Adjusted EBITDA was calculated on a twelve month trailing rate for purposes of calculating net debt to adjusted EBITDA. Adjusted EBITDA for the twelve months trailing March 31, 2011 and 2010 was $11,932,573 and $23,062,368, respectively.