Patriot Transportation Holding, Inc. (NASDAQ:PATI)
Third Quarter Results for Fiscal Year
2016.
The Company reported net income of $1,379,000,
or $0.42 per share, compared to net income of $1,003,000, or $0.31
per share, in the same quarter last year.
Total revenues for the quarter were $31,362,000,
up $263,000 from $31,099,000 in the same quarter last year.
Fuel surcharge revenues were lower by $1,315,000 as the
average price of diesel fuel was lower ($.54 per gallon) this
quarter versus the same quarter last year. Transportation revenues
(excluding fuel surcharges) were up $1,578,000 (or 5.5%) to
$30,187,000 on 134,000 more revenue miles and an increase of 4.3%
revenue per mile versus the same quarter last year.
Compensation and benefits costs were up $482,000
(or $.04 per mile) versus the third quarter of fiscal 2015 due
primarily to driver pay enhancements and increased miles.
The Company’s gross cost of fuel was down
$1,064,000 over the same quarter last year which was not enough to
off-set the $1,315,000 decline in fuel surcharge revenues resulting
in a negative margin impact of $251,000 (or $.02 per mile) this
quarter. In the first and second quarters of this
fiscal year we experienced a negative margin impact of $883,000 (or
$.09 per mile) and $719,000 (or $.07 per mile), respectively, as a
result of declining fuel surcharges outpacing the decline in our
gross fuel cost. During the fiscal year we were able to
negotiate positive adjustments to the fuel surcharge tables of some
of our customers and those adjustments have contributed to the
positive trend of less margin erosion resulting from lower diesel
prices.
SG&A was up $261,000 as we have increased
staff to help better manage and support our people in the field, to
resolve issues with driver hiring and turnover and to support our
safety performance. Corporate expense was $280,000 lower
compared to the same quarter last year due mainly to reduced
airplane expenses following the sale of a 75% interest in the
corporate airplane last quarter.
Operating profit this quarter was $2,290,000, an
increase of $617,000 or 37% compared to $1,673,000 in the same
quarter last year. Our operating ratio improved to 92.7%
compared to 94.6% in the same quarter last year.
First Nine Months’ Results
for Fiscal Year 2016.
The Company reported net income of $3,617,000,
or $1.10 per share compared to net income of $1,754,000, or $0.54
per share in the same period last year. The current year
income includes $1,029,000, or $0.31 per share, of net income from
the settlement of a claim with BP for $1,687,000 in connection with
the 2010 Deepwater Horizon event. The prior year included a
$2,074,000 intangible asset impairment charge with an after tax
impact to net income of $1,265,000 or $0.39 per share, related to
the Pipeline Transportation acquisition.
Total revenues were $89,781,000 down from
$92,553,000 last year as a result of $6,488,000 lower fuel
surcharges. Transportation revenues (excluding fuel
surcharges) were up $3,716,000 to $86,710,000 on 118,000 fewer
miles and an increase of 5.1% revenue per mile versus the same
period last year.
The Company’s gross cost of fuel was down
$4,635,000 over the same period last year which was not enough to
off-set the $6,488,000 reduction in fuel surcharge revenues
resulting in a negative margin impact of $1,853,000 (or $.06 per
mile) this period versus the same period last year.
Compensation and benefits costs were up
$2,050,000 (or $.06 per mile) versus the same period last year due
primarily to driver pay enhancements and increased driver
training.
Corporate expense was lower by $545,000 compared
to the same period last year due mainly to the sale of a 75%
interest in the corporate airplane during the last
quarter.
We had $663,000 less in gains on equipment sales
this period versus the same period last year.
Operating profit this period was $4,336,000
versus an operating profit of $2,953,000 in the same period last
year. The prior year included the $2,074,000 intangible asset
impairment charge.
Adjusted operating profit was $4,336,000 versus
adjusted operating profit of $5,027,000 in the same period last
year. Adjusted net income was $2,588,000 compared to adjusted
net income of $3,019,000 in the same period last year. These
non-GAAP financial measures exclude the BP Settlement gain realized
in the first quarter of fiscal 2016 and the intangible asset
impairment charge incurred in the second quarter of fiscal
2015. Management believes these adjusted measures better
reflect our operating performance during the periods discussed and
reflect how management evaluates our operational results.
Refer to “Non-GAAP Financial Measures” below in this press release
for a more detailed discussion, including reconciliations of these
non-GAAP financial measures to their most directly comparable GAAP
financial measures”.
Summary and Outlook.
We have been successful the past several
quarters in growing our per mile transportation revenue while
adding revenue miles through new business opportunities. We
were pleased to see the improvements in our operating margin during
the 3rd quarter and are optimistic that we can retain that margin
in the 4th quarter. The substantial improvement in net fuel
expense this quarter was encouraging and we will continue to work
to neutralize the negative margin effects of lower fuel prices but
this effort at neutralization will take some time to resolve as it
is an industry wide issue.
We operate in many of the best markets in the
country and are known in those markets, and beyond, as a top rated
carrier for both safety and customer satisfaction. We are
committed to continuing our focus on safety and customer
satisfaction and are confident that execution of that focus will
enable us to continue our growth in our excellent markets. We
plan to maintain a strong balance sheet as we work to achieve our
targeted operating ratio in the low nineties and double digit
returns on after tax capital employed.
Conference Call.
The Company will host a conference call on
Wednesday, July 27, 2016 at 2:00 p.m. (EDT). Analysts, stockholders
and other interested parties may access the teleconference live by
calling 1-800-933-4911 (pass code 94564) for domestic or
1-334-323-7224 (pass code 94564) for international. Computer audio
live streaming is available via the Internet through the Company’s
website at www.patriottrans.com at the Investor Relations tab. You
may click on this link for the live streaming
http://stream.conferenceamerica.com/pth072716. Click on the
following link
http://archive.conferenceamerica.com/archivestream/pth072716.mp3 to
access the archived internet audio replay. A telephonic audio
replay will be available for sixty days following the conference
call and is accessible by dialing toll free 877-919-4059 domestic
or 334-323-0140 international. The passcode of the audio replay is
31774712. Replay options: “1” begins playback, “4” rewind 30
seconds, “5” pause, “6” fast forward 30 seconds, “0” instructions,
and “9” exits recording. There may be a short delay until the
archive is available following the conclusion of the conference
call.
Investors are cautioned that any statements in
this press release which relate to the future are, by their nature,
subject to risks and uncertainties that could cause actual results
and events to differ materially from those indicated in such
forward-looking statements. These include general economic
conditions; competitive factors; political, economic,
regulatory and climatic conditions; driver availability and cost;
the impact of future regulations regarding the transportation
industry; freight demand for petroleum product and levels of
construction activity in the Company's markets; fuel costs; risk
insurance markets; pricing; energy costs and technological
changes. Additional information regarding these and other
risk factors and uncertainties may be found in the Company’s
filings with the Securities and Exchange Commission.
Patriot Transportation Holding, Inc. is engaged
in the transportation business. The Company’s transportation
business is conducted through Florida Rock & Tank Lines, Inc.
which is a Southeastern transportation company concentrating in the
hauling by motor carrier of liquid and dry bulk commodities.
PATRIOT TRANSPORTATION HOLDING, INC. AND
SUBSIDIARIES |
CONSOLIDATED AND COMBINED STATEMENTS OF
INCOME |
(In thousands) |
(Unaudited) |
|
|
|
|
|
|
|
|
THREE MONTHS ENDED |
|
NINE MONTHS ENDED |
|
|
|
JUNE 30, |
|
JUNE 30, |
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transportation
revenues |
|
$ |
30,187 |
|
|
|
28,609 |
|
|
$ |
86,710 |
|
|
|
82,994 |
|
Fuel surcharges |
|
|
1,175 |
|
|
|
2,490 |
|
|
|
3,071 |
|
|
|
9,559 |
|
Total
revenues |
|
|
31,362 |
|
|
|
31,099 |
|
|
|
89,781 |
|
|
|
92,553 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits |
|
|
13,034 |
|
|
|
12,552 |
|
|
|
38,358 |
|
|
|
36,308 |
|
Fuel
expenses |
|
|
4,031 |
|
|
|
5,095 |
|
|
|
11,326 |
|
|
|
15,961 |
|
Repairs &
tires |
|
|
2,061 |
|
|
|
2,019 |
|
|
|
5,806 |
|
|
|
5,739 |
|
Other
operating |
|
|
1,195 |
|
|
|
1,090 |
|
|
|
3,464 |
|
|
|
3,215 |
|
Insurance and
losses |
|
|
2,736 |
|
|
|
2,681 |
|
|
|
7,972 |
|
|
|
8,298 |
|
Depreciation
expense |
|
|
2,245 |
|
|
|
2,098 |
|
|
|
6,518 |
|
|
|
6,330 |
|
Rents, tags &
utilities |
|
|
949 |
|
|
|
987 |
|
|
|
2,853 |
|
|
|
2,882 |
|
Sales, general
& administrative |
|
|
2,404 |
|
|
|
2,143 |
|
|
|
7,016 |
|
|
|
6,779 |
|
Corporate
expenses |
|
|
502 |
|
|
|
782 |
|
|
|
2,288 |
|
|
|
2,833 |
|
Intangible asset
impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,074 |
|
Gain on equipment
sales |
|
|
(85 |
) |
|
|
(21 |
) |
|
|
(156 |
) |
|
|
(819 |
) |
Total cost
of operations |
|
|
29,072 |
|
|
|
29,426 |
|
|
|
85,445 |
|
|
|
89,600 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
operating profit |
|
|
2,290 |
|
|
|
1,673 |
|
|
|
4,336 |
|
|
|
2,953 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BP claim
settlement |
|
|
— |
|
|
|
— |
|
|
|
1,687 |
|
|
|
— |
|
Interest
income and other |
|
|
1 |
|
|
|
— |
|
|
|
4 |
|
|
|
— |
|
Interest
expense |
|
|
(31 |
) |
|
|
(29 |
) |
|
|
(98 |
) |
|
|
(78 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
before income taxes |
|
|
2,260 |
|
|
|
1,644 |
|
|
|
5,929 |
|
|
|
2,875 |
|
Provision
for income taxes |
|
|
881 |
|
|
|
641 |
|
|
|
2,312 |
|
|
|
1,121 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
$ |
1,379 |
|
|
|
1,003 |
|
|
$ |
3,617 |
|
|
|
1,754 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
|
$ |
1,379 |
|
|
|
1,003 |
|
|
$ |
3,617 |
|
|
|
1,754 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
0.42 |
|
|
|
0.31 |
|
|
|
1.10 |
|
|
|
0.54 |
|
Diluted |
|
|
0.42 |
|
|
|
0.31 |
|
|
|
1.10 |
|
|
|
0.54 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares (in thousands)used in
computing: |
|
|
|
|
|
-basic earnings per common
share |
|
|
3,287 |
|
|
|
3,268 |
|
|
|
3,281 |
|
|
|
3,265 |
|
-diluted earnings per common
share |
|
|
3,289 |
|
|
|
3,276 |
|
|
|
3,284 |
|
|
|
3,273 |
|
Non-GAAP Financial
Measures.
To supplement the financial results presented in
accordance with GAAP, Patriot presents certain non-GAAP financial
measures within the meaning of Regulation G promulgated by the
Securities and Exchange Commission. The non-GAAP financial measures
included in this press release are adjusted net income, adjusted
operating profit and adjusted operating ratio. Patriot uses these
non-GAAP financial measures to analyze its continuing operations
and to monitor, assess, and identify meaningful trends in its
operating and financial performance. These measures are not, and
should not be viewed as, substitutes for GAAP financial
measures.
Adjusted Net Income
Adjusted net income excludes the impact of the
BP settlement and intangible asset impairment charge. Adjusted net
income is presented to provide additional perspective on underlying
trends in Patriot’s core operating results. A reconciliation
between net income and adjusted net income is as follows:
|
|
Nine months ended |
|
Nine months ended |
|
|
|
June 30, 2016 |
|
June 30, 2015 |
|
Net Income |
|
$ |
3,617 |
|
|
|
1,754 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
Intangible asset impairment
charge |
|
|
|
— |
|
|
|
2,074 |
|
Provision for deferred income
taxes |
|
|
|
— |
|
|
|
(809 |
) |
BP claim settlement |
|
|
|
(1,687 |
) |
|
|
— |
|
Provision for cash income
taxes |
|
|
|
658 |
|
|
|
|
|
— |
|
Adjusted net
income |
|
$ |
2,588 |
|
|
|
3,019 |
|
Adjusted Operating Ratio
Adjusted operating ratio excludes the impact of the intangible
asset impairment charge. Adjusted operating ratio is presented to
provide additional perspective on underlying trends in Patriot’s
core operating results. A reconciliation between operating ratio
and adjusted operating ratio is as follows:
|
|
Nine months ended |
|
Nine months ended |
|
|
|
June 30, 2016 |
|
June 30, 2015 |
|
Operating ratio |
|
95.2 |
% |
|
96.8 |
% |
|
Adjustments: |
|
|
|
|
|
Intangible asset impairment
charge |
|
— |
|
|
(2.2 |
% |
) |
Adjusted operating
ratio |
|
95.2 |
% |
|
94.6 |
% |
|
Adjusted Operating Profit
Adjusted operating profit excludes the impact of the intangible
asset impairment charge. Adjusted operating profit is presented to
provide additional perspective on underlying trends in Patriot’s
core operating results. A reconciliation between operating profit
and adjusted operating profit is as follows:
|
|
Nine months ended |
|
Nine months ended |
|
|
June 30, 2016 |
|
June 30, 2015 |
Operating profit |
|
$ |
4,336 |
|
|
2,953 |
Adjustments: |
|
|
|
|
|
|
|
Intangible asset impairment
charge |
|
|
|
— |
|
|
|
|
2,074 |
Adjusted operating
profit |
|
$ |
4,336 |
|
|
5,027 |
Contact:
John D. Milton, Jr.
Chief Financial Officer
904/858-9100
Patriot Transportation (NASDAQ:PATI)
Historical Stock Chart
From Jun 2024 to Jul 2024
Patriot Transportation (NASDAQ:PATI)
Historical Stock Chart
From Jul 2023 to Jul 2024