HOUSTON, May 9 /PRNewswire-FirstCall/ -- EGL, Inc. (Nasdaq: EAGL) today
reported net income for the first quarter of 2007 of $17.3 million, or
$0.42 cents per diluted share. The results compare to first quarter 2006
net income of $11.1 million, or $0.27 cents per diluted share. Operating
income in the first quarter of 2007 was $26.2 million, an increase of 20%
from $21.9 million earned in the first quarter a year ago.
The first quarter of 2007 diluted earnings per share of $0.42 included
net expenses of $0.08 cents per diluted share ($3.1 million after tax)
related to costs incurred associated with the previously-announced
proposals to acquire the Company. The first quarter of 2006 diluted
earnings per share of $0.27 included a net gain of $0.04 per share ($1.5
million after tax) related to the resolution of business interruption and
related claims filed in 2005 resulting from a fire at the Company's
Thurrock facility in the United Kingdom. Q1 Financial Highlights:
* Gross revenues increased 6% to $799 million compared with $752 million
in the first quarter of 2006;
* Net revenues increased 14% to $270 million compared with $237 million
in the first quarter of 2006;
* Net revenue margin improved to 33.8% compared with 31.5% in the first
quarter of 2006.
Three Months Ended
$ millions (except EPS) 3/31/07 3/31/06
Gross revenues $798.8 $752.4
% change + 6%
Net revenues $270.1 $237.2
% change + 14%
Net revenue margin 33.8% 31.5%
Operating expenses $243.9 215.3
Operating income $26.2 $21.9
Net income $17.3 $11.1
Diluted EPS $0.42 $0.27
EGL Chief Executive Officer Jim Crane commented, "Our first quarter
results reflect increased gross and net revenues, improvements in operating
expenses and solid cash flow from operations. Our global team quickly
reacted to our weak fourth quarter results and delivered solid results in
the first quarter of 2007. I want to thank our entire staff for this
improved performance."
Gross revenues of $798.8 million in the first quarter of 2007 increased
6% from the same quarter last year, with increases in airfreight forwarding
of 2%, ocean freight forwarding of 11%, and customs brokerage, logistics
and other of 15%. Gross revenues outside of North America accounted for 54%
of first quarter activity and increased 2% over the same quarter last year
due to higher volumes in Europe and Latin America. North America gross
revenues accounted for 46% of first quarter activity and increased 12% over
the same quarter last year.
Net revenues of $270.1 million in the first quarter of 2007 increased
14% from the same quarter last year driven by a 8% increase in airfreight
forwarding, a 9% increase in ocean freight forwarding and a 27% increase in
customs brokerage, logistics and other. The Company's first quarter net
revenue margin increased to 33.8% compared with 31.5% in the same quarter
last year.
Operating income increased 20% to $26.2 million, as compared with the
first quarter of 2006. Operating expenses included $3.5 million of expenses
($3.1 million after-tax or $0.08 per share) related to costs associated
with the proposed acquisition. Operating income as a percent of net
revenues was 9.7% compared with 9.2% in the same quarter last year.
Non-operating income in the first quarter of 2007 was $1.3 million
compared with non-operating expense of $3.5 million in the same quarter
last year. The improvement was primarily due to the first quarter 2007 gain
of $1.9 million from the final release of escrow funds related to the
previous sale of the Company's interest in TDS, $1.0 million of lower net
interest expense due to a reduction in borrowings and first quarter 2007
foreign exchange losses of $0.2 million compared with $0.8 million of
foreign exchange losses in the same quarter last year.
Cash Position
EGL closed the quarter with $131 million in cash, restricted cash and
short-term investments and total debt of $136 million. Cash flow from
operating activities was $37 million for the first quarter compared with
$65 million in the same quarter last year. Capital expenditures for the
first quarter were $5.8 million compared with $7.5 million in the first
quarter of 2006.
EGL, Inc. will not hold a conference call to review results for the
first quarter ended March 31, 2007.
Founded in 1984, Houston-based EGL, Inc. operates under the name EGL
Eagle Global Logistics. EGL is a leading global transportation, supply
chain management and information services company dedicated to providing
superior flexibility and fewer shipping restrictions on a price competitive
basis. With 2006 revenues of $3.2 billion, EGL's services include air and
ocean freight forwarding, customs brokerage, local pickup and delivery
service, materials management, warehousing, trade facilitation and
procurement, and integrated logistics and supply chain management services.
The Company's shares are traded on the NASDAQ Global Select Market under
the symbol "EAGL".
CAUTIONARY STATEMENTS
The statements in this press release that are not historical facts are
forward looking statements. These statements involve risks and
uncertainties including, but not limited to, market conditions, the
Company's financial results and performance, the effect, timing and events
arising out of pending or proposed merger transactions, our ability to
manage and continue growth, risks associated with operating in
international markets, events impacting the volume of international trade,
our ability to comply with rules relating to the performance of U.S.
government contracts, fuel shortages and price volatility of fuel, seasonal
trends in our business, currency devaluations and fluctuations in foreign
markets, our effective income tax rate, our ability to upgrade our
information technology systems, protecting our intellectual property
rights, heightened global security measures, availability of cargo space,
increases in the prices charged by our suppliers, competition in the
freight industry and our ability to maintain market share, material
weaknesses within our internal controls, control by and dependence on our
founder, liability for loss or damage to goods, the results of litigation,
exposure to fines and penalties if our owner/operators are deemed to be
employees, failure to comply with environmental, health and safety, and
criminal laws and regulations and governmental permit and licensing
requirements, laws and regulations that decrease our ability to change our
charter and bylaws, the impact of goodwill impairments, the successful
deployment of our global IT infrastructure, estimated expenses associated
with stock option practices and other factors detailed in the Risk Factors
and elsewhere in the Company's most recent Annual Report on Form 10-K and
other filings with the Securities and Exchange Commission. Should one or
more of these risks or uncertainties materialize (or the consequences of
such a development worsen), or should underlying assumptions prove
incorrect, actual outcomes may vary materially from those forecasted or
expected. The Company disclaims any intention or obligation to update
publicly or revise such statements, whether as a result of new information,
future events or otherwise.
EGL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(in thousands, except per share amounts)
Three Months Ended
March 31,
2007 2006
Revenues $798,760 $752,363
Cost of transportation 528,668 515,162
Net revenues 270,092 237,201
Operating expenses:
Personnel costs 151,556 134,596
Other selling, general and
administrative expenses 88,861 80,724
Merger costs 3,504 ---
Operating income 26,171 21,881
Nonoperating income (expense), net 1,267 (3,482)
Income before provision for income taxes 27,438 18,399
Provision for income taxes 10,132 7,295
Net income $17,306 $11,104
Basic earnings per share $0.42 $0.28
Diluted earnings per share $0.42 $0.27
Basic weighted-average common
shares outstanding 40,751 40,096
Diluted weighted-average common
shares outstanding 41,000 40,649
EGL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands)
March 31, December 31,
2007 2006
ASSETS
Current assets:
Cash, cash equivalents, restricted cash
and short-term investments $130,685 $141,422
Trade accounts receivable, net of
allowance 586,762 623,558
Other current assets 74,112 70,570
Total current assets 791,559 835,550
Property and equipment, net 187,550 188,498
Goodwill, net 112,771 112,498
Other assets, net 42,105 43,892
Total assets $1,133,985 $1,180,438
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $17,113 $12,739
Trade payables and accrued
transportation costs 330,580 373,970
Accrued expenses and other liabilities 175,627 161,341
Total current liabilities 523,320 548,050
Long-term debt 118,892 157,157
Other noncurrent liabilities 52,318 55,417
Minority interest 1,527 1,761
Stockholders' equity 437,928 418,053
Total liabilities and stockholders' equity $1,133,985 $1,180,438
EGL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
Three Months Ended
March 31,
2007 2006
Cash flows from operating activities:
Net income $17,306 $11,104
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 8,388 8,911
Bad debt expense 746 716
Other (1,499) 2,338
Net effect of changes in working
capital, net of assets acquired 11,823 41,806
Net cash provided by operating activities 36,764 64,875
Cash flows from investing activities:
Capital expenditures (5,774) (7,469)
(Increase) decrease in restricted cash 1,097 (618)
Proceeds from sales of other assets 172 203
Proceeds from property insurance --- 517
Acquisitions of businesses,
net of cash acquired --- (1,444)
Cash received from disposal of affiliates 2,895 1,254
Other 1,008 271
Net cash used in investing activities (602) (7,286)
Cash flows from financing activities:
Proceeds from issuance of debt 78,005 88,025
Repayment of debt (116,915) (134,055)
Repayment of short-term debt with
maturities of less than three months, net (8,070) (1,844)
Repayment of financed insurance
premiums and software, net (830) (1,306)
Payment on capital lease obligations (338) (662)
Payment of financing fees --- (68)
Proceeds from exercise of stock options 1,421 9,336
Excess tax benefit of employee stock plans 419 2,889
Other --- (128)
Net cash used in financing activities (46,308) (37,813)
Effect of exchange rate changes on cash 492 580
Increase (decrease) in cash
and cash equivalents (9,654) 20,356
Cash and cash equivalents, beginning
of the period 131,915 111,507
Cash and cash equivalents, end of the period $122,261 $131,863
SOURCE EGL, Inc.
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Related links:
http://www.eaglegl.com
CONTACT:
Mike Slaughter, Chief Accounting Officer of
EGL, Inc., +1-281-618-3428
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