Texas
(State or other jurisdiction of
incorporation or organization)
|
75-1301831
(IRS Employer Identification No.)
|
|
1145 Empire Central Place
Dallas, Texas 75247-4305
(Address of principal executive offices)
|
(214) 630-8090
(Registrant's telephone number,
including area code)
|
Large accelerated filer o
|
Accelerated Filer o
|
Non-accelerated filer x
|
Smaller Reporting Company o
|
Class
|
Number of Shares Outstanding
|
|||
Common stock, $1.50 par value
|
17,743,382 at October 21, 2011
|
PART I Financial Information
|
Page No.
|
|
Item 1
|
Financial Statements
|
|
Consolidated Condensed Balance Sheets (unaudited)
September 30, 2011 and December 31, 2010
|
1
|
|
Consolidated Condensed Statements of Operations (unaudited)
Three and nine months ended September 30, 2011 and 2010
|
2
|
|
Consolidated Condensed Statements of Cash Flows (unaudited)
Nine months ended September 30, 2011 and 2010
|
3
|
|
Consolidated Condensed Statements of Shareholders’ Equity (unaudited)
Nine months ended September 30, 2011 and year ended December 31, 2010
|
4
|
|
Notes to Consolidated Condensed Financial Statements (unaudited)
|
5
|
|
Item 2
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
8
|
Item 3
|
Quantitative and Qualitative Disclosures about Market Risk
|
24
|
Item 4
|
Controls and Procedures
|
24
|
PART II Other Information
|
||
Item 1
|
Legal Proceedings
|
24
|
Item 1A
|
Risk Factors
|
25
|
Item 2
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
25
|
Item 3
|
Defaults Upon Senior Securities
|
25
|
Item 4
|
Removed and Reserved
|
25
|
Item 5
|
Other Information
|
25
|
Item 6
|
Exhibits
|
26
|
Signatures
|
27
|
|
Exhibit Index
|
28
|
Assets
|
September 30, 2011
|
December 31, 2010
|
||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$
|
2,148
|
$
|
1,203
|
||||
Accounts receivable, net
|
46,695
|
41,921
|
||||||
Tires on equipment in use, net
|
6,999
|
5,982
|
||||||
Deferred income taxes
|
1,150
|
1,150
|
||||||
Other current assets
|
8,307
|
6,575
|
||||||
Assets held for sale, net of accumulated depreciation
|
10,818
|
-
|
||||||
Total current assets
|
76,117
|
56,831
|
||||||
Property and equipment, net
|
63,507
|
72,993
|
||||||
Other assets
|
6,185
|
5,081
|
||||||
Total assets
|
$
|
145,809
|
$
|
134,905
|
||||
Liabilities and Shareholders' Equity
|
||||||||
Current liabilities
|
||||||||
Accounts payable
|
$
|
26,986
|
$
|
27,443
|
||||
Insurance and claims accruals
|
11,160
|
8,697
|
||||||
Accrued payroll and deferred compensation
|
4,959
|
5,032
|
||||||
Accrued liabilities
|
1,196
|
709
|
||||||
Current maturities of notes payable and capital lease obligations
|
1,407
|
-
|
||||||
Total current liabilities
|
45,708
|
41,881
|
||||||
Long-term debt
|
28,352
|
5,689
|
||||||
Long-term notes payable and capital lease obligations
|
8,146
|
-
|
||||||
Deferred income taxes
|
1,506
|
3,153
|
||||||
Insurance and claims accruals
|
7,541
|
5,373
|
||||||
Total liabilities
|
91,253
|
56,096
|
||||||
Shareholders’ equity
|
||||||||
Common stock, $1.50 par value per share; 75,000 shares authorized;
|
||||||||
18,572 shares issued
|
27,858
|
27,858
|
||||||
Additional paid-in capital
|
188
|
|
1,353
|
|||||
Accumulated other comprehensive loss
|
(69
|
)
|
-
|
|||||
Retained earnings
|
33,332
|
58,242
|
||||||
Total common shareholders’ equity
|
61,309
|
87,453
|
||||||
Treasury stock (960 and 1,146 shares), at cost
|
(6,753
|
)
|
(8,644
|
)
|
||||
Total shareholders’ equity
|
54,556
|
78,809
|
||||||
Total liabilities and shareholders’ equity
|
$
|
145,809
|
$
|
134,905
|
Three Months
Ended September 30,
|
Nine Months
Ended September 30,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Total operating revenue
|
$
|
102,834
|
$
|
93,870
|
$
|
296,270
|
$
|
274,669
|
||||||||
Operating expenses
|
||||||||||||||||
Salaries, wages and related expenses
|
31,766
|
30,243
|
90,868
|
87,288
|
||||||||||||
Purchased transportation
|
18,357
|
18,132
|
51,856
|
55,972
|
||||||||||||
Fuel
|
25,854
|
18,469
|
73,654
|
51,782
|
||||||||||||
Supplies and maintenance
|
15,710
|
13,447
|
42,561
|
36,010
|
||||||||||||
Revenue equipment rent
|
9,200
|
9,353
|
26,553
|
27,116
|
||||||||||||
Depreciation
|
4,827
|
4,216
|
13,875
|
12,114
|
||||||||||||
Communications and utilities
|
1,171
|
1,287
|
3,518
|
3,658
|
||||||||||||
Claims and insurance
|
7,476
|
3,486
|
13,204
|
10,764
|
||||||||||||
Operating taxes and licenses
|
985
|
1,003
|
3,089
|
3,209
|
||||||||||||
Gain on sale of property and equipment
|
(661
|
)
|
(12
|
)
|
(1,234
|
)
|
(592
|
)
|
||||||||
Miscellaneous
|
1,626
|
1,109
|
4,352
|
3,101
|
||||||||||||
Total operating expenses
|
116,311
|
100,733
|
322,296
|
290,422
|
||||||||||||
Loss from operations
|
(13,477
|
)
|
(6,863
|
)
|
(26,026
|
)
|
(15,753
|
)
|
||||||||
Interest and other expense (income)
|
||||||||||||||||
Interest income
|
-
|
(15
|
)
|
-
|
(30
|
)
|
||||||||||
Interest expense
|
247
|
105
|
479
|
308
|
||||||||||||
Equity in earnings of limited partnership
|
(192
|
)
|
(246
|
)
|
(551
|
)
|
(443
|
)
|
||||||||
Life insurance and other
|
63
|
(43
|
)
|
432
|
84
|
|||||||||||
Total interest and other expense (income)
|
118
|
(199
|
)
|
360
|
(81
|
)
|
||||||||||
Loss before income taxes
|
(13,595
|
)
|
(6,664
|
)
|
(26,386
|
)
|
(15,672
|
)
|
||||||||
Income tax expense (benefit)
|
73
|
(4,383
|
)
|
(1,476
|
)
|
(5,241
|
)
|
|||||||||
Net loss
|
$
|
(13,668
|
)
|
$
|
(2,281
|
)
|
$
|
(24,910
|
)
|
$
|
(10,431
|
)
|
||||
Net loss per share of common stock
|
||||||||||||||||
Basic
|
$
|
(0.77
|
)
|
$
|
(0.13
|
)
|
$
|
(1.42
|
)
|
$
|
(0.61
|
)
|
||||
Diluted
|
$
|
(0.77
|
)
|
$
|
(0.13
|
)
|
$
|
(1.42
|
)
|
$
|
(0.61
|
)
|
||||
Weighted average shares outstanding
|
||||||||||||||||
Basic
|
17,663
|
17,384
|
17,557
|
17,223
|
||||||||||||
Diluted
|
17,663
|
17,384
|
17,557
|
17,223
|
Nine Months
Ended September 30,
|
||||||||
2011
|
2010
|
|||||||
Cash flows from operating activities
|
||||||||
Net loss
|
$
|
(24,910
|
)
|
$
|
(10,431
|
)
|
||
Non-cash items included in net loss
|
||||||||
Gain on sale of property and equipment
|
(1,234
|
)
|
(592
|
)
|
||||
Depreciation and amortization
|
17,029
|
14,963
|
||||||
Provision for losses on accounts receivable
|
1,061
|
678
|
||||||
Deferred income tax
|
(1,647
|
)
|
(5,619
|
)
|
||||
Deferred compensation
|
152
|
492
|
||||||
Postretirement benefits
|
(69
|
)
|
-
|
|||||
Investment income
|
(551
|
)
|
(443
|
)
|
||||
Changes in operating assets and liabilities
|
||||||||
Accounts receivable
|
(5,835
|
)
|
(1,854
|
)
|
||||
Tires on equipment in use
|
(4,184
|
)
|
(2,861
|
)
|
||||
Other current assets
|
(1,327
|
)
|
6,521
|
|||||
Accounts payable
|
(122
|
)
|
7,251
|
|||||
Other assets
|
(1,536
|
)
|
(467
|
)
|
||||
Insurance and claims accruals
|
4,631
|
(2,441
|
)
|
|||||
Accrued liabilities, payroll and other
|
995
|
1,796
|
||||||
Net cash (used in) provided by operating activities
|
(17,547
|
)
|
6,993
|
|||||
Cash flows from investing activities
|
||||||||
Expenditures for property and equipment
|
(19,683
|
)
|
(16,719
|
)
|
||||
Proceeds from sale of property and equipment
|
4,969
|
6,531
|
||||||
Cash distributions from investment
|
999
|
1,016
|
||||||
Other
|
-
|
76
|
||||||
Net cash used in investing activities
|
(13,715
|
)
|
(9,096
|
)
|
||||
Cash flows from financing activities
|
||||||||
Proceeds from borrowings
|
98,273
|
15,272
|
||||||
Payments against borrowings
|
(75,610
|
)
|
(15,272
|
)
|
||||
Proceeds from notes payable and capital lease obligations
|
9,685
|
-
|
||||||
Repayments of notes payable and capital lease obligations
|
(132
|
)
|
-
|
|||||
Income tax benefit (expense) of stock options and restricted stock
|
22
|
(6
|
)
|
|||||
Proceeds from capital stock transactions, net
|
604
|
671
|
||||||
Purchases of treasury stock
|
(635
|
)
|
(71
|
)
|
||||
Net cash provided by financing activities
|
32,207
|
594
|
||||||
Net increase (decrease) in cash and cash equivalents
|
945
|
(1,509
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
1,203
|
3,667
|
||||||
Cash and cash equivalents at end of period
|
$
|
2,148
|
$
|
2,158
|
Common Stock
|
Additional
|
|||||||||||||||||||||||||||||||
Shares
|
Par
|
Paid-in
|
Retained
|
Accumulated other
|
Treasury Stock
|
|||||||||||||||||||||||||||
Issued
|
Value
|
Capital
|
Earnings
|
Comprehensive loss
|
Shares
|
Cost
|
Total
|
|||||||||||||||||||||||||
January 1, 2010
|
18,572 | $ | 27,858 | $ | 2,923 | $ | 70,172 | $ | - | 1,477 | $ | (11,218 | ) | $ | 89,735 | |||||||||||||||||
Net loss
|
- | - | - | (11,930 | ) | - | - | - | (11,930 | ) | ||||||||||||||||||||||
Treasury stock reacquired
|
- | - | - | - | - | 21 | (76 | ) | (76 | ) | ||||||||||||||||||||||
Retirement plans
|
- | - | (12 | ) | - | - | (1 | ) | 4 | (8 | ) | |||||||||||||||||||||
Exercise of stock options
|
- | - | (1,146 | ) | - | - | (241 | ) | 1,817 | 671 | ||||||||||||||||||||||
Restricted stock
|
- | - | (352 | ) | - | - | (110 | ) | 829 | 477 | ||||||||||||||||||||||
Tax expense of stock options
|
- | - | (60 | ) | - | - | - | - | (60 | ) | ||||||||||||||||||||||
December 31, 2010
|
18,572 | 27,858 | 1,353 | 58,242 | - | 1,146 | (8,644 | ) | 78,809 | |||||||||||||||||||||||
Net loss
|
- | - | - | (24,910 | ) | - | - | (24,910 | ) | |||||||||||||||||||||||
Treasury stock reacquired
|
- | - | - | - | - | 168 | (635 | ) | (635 | ) | ||||||||||||||||||||||
Retirement plans
|
- | - | (137 | ) | - | (69 | ) | (28 | ) | 200 | (6 | ) | ||||||||||||||||||||
Exercise of stock options
|
- | - | (1,362 | ) | - | - | (278 | ) | 1,966 | 604 | ||||||||||||||||||||||
Restricted stock
|
- | - | 312 | - | - | (48 | ) | 360 | 672 | |||||||||||||||||||||||
Tax benefit of stock options
|
- | - | 22 | - | - | - | - | 22 | ||||||||||||||||||||||||
September 30, 2011
|
18,572 | $ | 27,858 | $ | 188 | $ | 33,332 | $ | (69 | ) | 960 | $ | (6,753 | ) | $ | 54,556 |
(in thousands)
|
||||||||
|
September 30, 2011
|
December 31, 2010
|
||||||
Borrowings under credit facility
|
|
$
|
28,352
|
|
$
|
5,689
|
||
Notes payable
|
|
6,601
|
|
-
|
||||
Capitalized lease obligations
|
|
2,952
|
|
-
|
||||
Total long-term debt
|
|
37,905
|
|
5,689
|
||||
Less: Current maturities
|
|
(1,407
|
)
|
-
|
||||
Total maturities due after one year
|
|
$
|
36,498
|
|
$
|
5,689
|
(in thousands, except per-share amounts)
|
||||||||||||||||
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Numerator:
|
||||||||||||||||
Net loss
|
$
|
(13,668
|
)
|
$
|
(2,281
|
)
|
$
|
(24,910
|
)
|
$
|
(10,431
|
)
|
||||
Denominator:
|
||||||||||||||||
Basic-weighted average shares
|
17,663
|
17,384
|
17,557
|
17,223
|
||||||||||||
Effect of dilutive stock options
|
-
|
-
|
-
|
-
|
||||||||||||
Diluted-weighted average shares
|
17,663
|
17,384
|
17,557
|
17,223
|
||||||||||||
Basic loss per common share
|
$
|
(0.77
|
)
|
$
|
(0.13
|
)
|
$
|
(1.42
|
)
|
$
|
(0.61
|
)
|
||||
Diluted loss per common share
|
$
|
(0.77
|
)
|
$
|
(0.13
|
)
|
$
|
(1.42
|
)
|
$
|
(0.61
|
)
|
Three Months
|
Nine Months
|
|||||||||||||||
Revenue from: (a)
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Temperature-controlled fleet
|
$
|
29,875
|
$
|
29,776
|
$
|
90,231
|
$
|
85,935
|
||||||||
Dry-freight fleet
|
10,444
|
12,906
|
33,567
|
42,197
|
||||||||||||
Total truckload linehaul services
|
40,319
|
42,682
|
123,798
|
128,132
|
||||||||||||
Dedicated fleets
|
4,140
|
4,374
|
13,051
|
12,985
|
||||||||||||
Total truckload
|
44,459
|
47,056
|
136,849
|
141,117
|
||||||||||||
Less-than-truckload linehaul services
|
30,740
|
29,408
|
85,908
|
82,412
|
||||||||||||
Fuel surcharges
|
21,298
|
14,382
|
62,683
|
41,886
|
||||||||||||
Brokerage and logistics services
|
5,585
|
1,623
|
8,269
|
5,388
|
||||||||||||
Equipment rental
|
752
|
1,401
|
2,561
|
3,866
|
||||||||||||
Total operating revenue
|
102,834
|
93,870
|
296,270
|
274,669
|
||||||||||||
Operating expenses
|
116,311
|
100,733
|
322,296
|
290,422
|
||||||||||||
Loss from operations
|
$
|
(13,477
|
)
|
$
|
(6,863
|
)
|
$
|
(26,026
|
)
|
$
|
(15,753
|
)
|
||||
Operating ratio (b)
|
113.1
|
%
|
107.3
|
%
|
108.8
|
%
|
105.7
|
%
|
||||||||
Total truckload revenue
|
$
|
44,459
|
$
|
47,056
|
$
|
136,849
|
$
|
141,117
|
||||||||
Less-than-truckload revenue
|
30,740
|
29,408
|
85,908
|
82,412
|
||||||||||||
Total linehaul and dedicated fleet revenue
|
$
|
75,199
|
$
|
76,464
|
$
|
222,757
|
$
|
223,529
|
||||||||
Weekly average trucks
|
1,772
|
1,813
|
1,772
|
1,779
|
||||||||||||
Revenue per truck per week (c)
|
$
|
3,229
|
$
|
3,209
|
$
|
3,223
|
$
|
3,222
|
Computational notes:
|
|
Revenue and expense amounts are stated in thousands of dollars.
|
|
(b)
|
Operating expenses divided by total operating revenue.
|
(c)
|
Average daily revenue, times seven, divided by weekly average trucks.
|
Three Months
|
Nine Months
|
|||||||||||||||
Truckload
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
Total linehaul miles (a)
|
27,994
|
30,923
|
87,748
|
94,843
|
||||||||||||
Loaded miles (a)
|
24,809
|
27,294
|
77,889
|
83,805
|
||||||||||||
Empty mile ratio (b)
|
11.4
|
%
|
11.7
|
%
|
11.2
|
%
|
11.6
|
%
|
||||||||
Linehaul revenue per total mile (c)
|
$
|
1.44
|
$
|
1.38
|
$
|
1.41
|
$
|
1.35
|
||||||||
Linehaul revenue per loaded mile (d)
|
$
|
1.63
|
$
|
1.56
|
$
|
1.59
|
$
|
1.53
|
||||||||
Linehaul shipments (a)
|
27.8
|
31.0
|
86.4
|
93.5
|
||||||||||||
Loaded miles per shipment (e)
|
891
|
882
|
902
|
896
|
||||||||||||
LTL
|
||||||||||||||||
Hundredweight
|
2,128,575
|
2,126,278
|
6,194,980
|
5,990,371
|
||||||||||||
Shipments (a)
|
70.3
|
68.6
|
198.3
|
191.6
|
||||||||||||
Linehaul revenue per hundredweight (f)
|
$
|
14.44
|
$
|
13.83
|
$
|
13.87
|
$
|
13.76
|
||||||||
Linehaul revenue per shipment (g)
|
$
|
437
|
$
|
429
|
$
|
433
|
$
|
430
|
||||||||
Average weight per shipment (h)
|
3,026
|
3,098
|
3,124
|
3,126
|
Computational notes:
|
|
(a)
|
Amounts are stated in thousands.
|
(b)
|
Total truckload linehaul miles less truckload loaded miles, divided by total truckload linehaul miles.
|
(c)
|
Revenue from truckload linehaul services divided by total truckload linehaul miles.
|
(d)
|
Revenue from truckload linehaul services divided by truckload loaded miles.
|
(e)
|
Total truckload loaded miles divided by number of truckload linehaul shipments.
|
(f)
|
LTL revenue divided by LTL hundredweight.
|
(g)
|
LTL revenue divided by number of LTL shipments.
|
(h)
|
LTL hundredweight times one hundred divided by number of shipments.
|
2011
|
2010
|
|||||
Total company tractors available
|
1,613
|
1,507
|
||||
Total independent contractor tractors available
|
286
|
312
|
||||
Total tractors available
|
1,899
|
1,819
|
||||
Total trailers available
|
3,826
|
3,600
|
Revenue from (a)
|
2011
|
2010
|
Dollar Change
2011 vs. 2010
|
Percentage Change
2011 vs. 2010
|
|||||||||||
Temperature-controlled fleet
|
$
|
29,875
|
$
|
29,776
|
$
|
99
|
0.3
|
%
|
|||||||
Dry-freight fleet
|
10,444
|
12,906
|
(2,462
|
)
|
(19.1
|
)
|
|||||||||
Total truckload linehaul services
|
40,319
|
42,682
|
(2,363
|
)
|
(5.5
|
)
|
|||||||||
Dedicated fleets
|
4,140
|
4,374
|
(234
|
)
|
(5.3
|
)
|
|||||||||
Total truckload
|
44,459
|
47,056
|
(2,597
|
)
|
(5.5
|
)
|
|||||||||
Less-than-truckload linehaul services
|
30,740
|
29,408
|
1,332
|
4.5
|
|||||||||||
Fuel surcharges
|
21,298
|
14,382
|
6,916
|
48.1
|
|||||||||||
Brokerage and logistics services
|
5,585
|
1,623
|
3,962
|
244.1
|
|||||||||||
Equipment rental
|
752
|
1,401
|
(649
|
)
|
(46.3
|
)
|
|||||||||
Total operating revenue
|
102,834
|
93,870
|
8,964
|
9.5
|
|||||||||||
Operating expenses
|
116,311
|
100,733
|
15,578
|
15.5
|
|||||||||||
Loss from operations
|
$
|
(13,477
|
)
|
$
|
(6,863
|
)
|
$
|
(6,614
|
)
|
96.4
|
%
|
||||
Operating ratio (b)
|
113.1
|
%
|
107.3
|
%
|
|||||||||||
Total truckload revenue
|
$
|
44,459
|
$
|
47,056
|
$
|
(2,597
|
)
|
(5.5
|
)
|
%
|
|||||
Less-than-truckload revenue
|
30,740
|
29,408
|
1,332
|
4.5
|
|||||||||||
Total linehaul and dedicated fleet revenue
|
$
|
75,199
|
$
|
76,464
|
$
|
(1,265
|
)
|
(1.7
|
)
|
%
|
|||||
Weekly average trucks
|
1,772
|
1,813
|
(41
|
)
|
(2.3
|
)
|
%
|
||||||||
Revenue per truck per week (c)
|
$
|
3,229
|
$
|
3,209
|
$
|
20
|
0.6
|
%
|
Computational notes:
|
|
(a)
|
Revenue and expense amounts are stated in thousands of dollars.
|
(b)
|
Operating expenses divided by total operating revenue.
|
(c)
|
Average daily revenue, times seven, divided by weekly average trucks in service.
|
(in thousands)
Dollar Change
|
Percentage Change
|
Percentage of Revenue
|
||||||||
2011 vs. 2010
|
2011 vs. 2010
|
2011
|
2010
|
|||||||
Total operating revenue
|
$
|
8,964
|
9.5
|
%
|
100.0
|
%
|
100.0
|
%
|
||
Operating expenses
|
||||||||||
Salaries, wages and related expenses
|
1,523
|
5.0
|
30.9
|
32.2
|
||||||
Purchased transportation
|
225
|
1.2
|
17.9
|
19.3
|
||||||
Fuel
|
7,385
|
40.0
|
25.1
|
19.7
|
||||||
Supplies and maintenance
|
2,263
|
16.8
|
15.3
|
14.3
|
||||||
Revenue equipment rent
|
(153
|
)
|
(1.6
|
)
|
8.9
|
10.0
|
||||
Depreciation
|
611
|
14.5
|
4.7
|
4.5
|
||||||
Communications and utilities
|
(116
|
)
|
(9.0
|
)
|
1.1
|
3.7
|
||||
Claims and insurance
|
3,990
|
114.5
|
7.3
|
1.4
|
||||||
Operating taxes and licenses
|
(18
|
)
|
(1.8
|
)
|
1.0
|
1.1
|
||||
Gain on sale of property and equipment
|
(649
|
)
|
5408.3
|
(0.6
|
)
|
0.0
|
||||
Miscellaneous
|
517
|
46.6
|
1.6
|
1.1
|
||||||
Total operating expenses
|
$
|
15,578
|
15.5
|
%
|
113.1
|
%
|
107.3
|
%
|
Revenue from (a)
|
2011
|
2010
|
Dollar Change
2011 vs. 2010
|
Percentage Change
2011 vs. 2010
|
|||||||||||
Temperature-controlled fleet
|
$
|
90,231
|
$
|
85,935
|
$
|
4,296
|
5.0
|
%
|
|||||||
Dry-freight fleet
|
33,567
|
42,197
|
(8,630
|
)
|
(20.5
|
)
|
|||||||||
Total truckload linehaul services
|
123,798
|
128,132
|
(4,334
|
)
|
(3.4
|
)
|
|||||||||
Dedicated fleets
|
13,051
|
12,985
|
66
|
0.5
|
|||||||||||
Total truckload
|
136,849
|
141,117
|
(4,268
|
)
|
(3.0
|
)
|
|||||||||
Less-than-truckload linehaul services
|
85,908
|
82,412
|
3,496
|
4.2
|
|||||||||||
Fuel surcharges
|
62,683
|
41,886
|
20,797
|
49.7
|
|||||||||||
Brokerage and logistics services
|
8,269
|
5,388
|
2,881
|
53.5
|
|||||||||||
Equipment rental
|
2,561
|
3,866
|
(1,305
|
)
|
(33.8
|
)
|
|||||||||
Total operating revenue
|
296,270
|
274,669
|
21,601
|
7.9
|
|||||||||||
Operating expenses
|
322,296
|
290,422
|
31,874
|
11.0
|
|||||||||||
Loss from operations
|
$
|
(26,026
|
)
|
$
|
(15,753
|
)
|
$
|
(10,273
|
)
|
65.2
|
%
|
||||
Operating ratio (b)
|
108.8
|
%
|
105.7
|
%
|
|||||||||||
Total truckload revenue
|
$
|
136,849
|
$
|
141,117
|
$
|
(4,268
|
)
|
(3.0
|
)
|
%
|
|||||
Less-than-truckload revenue
|
85,908
|
82,412
|
3,496
|
4.2
|
|||||||||||
Total linehaul and dedicated fleet revenue
|
$
|
222,757
|
$
|
223,529
|
$
|
(772
|
)
|
(0.3
|
)
|
%
|
|||||
Weekly average trucks
|
1,772
|
1,779
|
(7
|
)
|
(0.4
|
)
|
%
|
||||||||
Revenue per truck per week (c)
|
$
|
3,223
|
$
|
3,222
|
$
|
1
|
-
|
%
|
Computational notes:
|
|
(a)
|
Revenue and expense amounts are stated in thousands of dollars.
|
(b)
|
Operating expenses divided by total operating revenue.
|
(c)
|
Average daily revenue, times seven, divided by weekly average trucks.
|
(in thousands)
Dollar Change
|
Percentage Change
|
Percentage of Revenue
|
||||||||
2011 vs. 2010
|
2011 vs. 2010
|
2011
|
2010
|
|||||||
Total operating revenue
|
$
|
21,601
|
7.9
|
%
|
100
|
%
|
100.0
|
%
|
||
Operating expenses
|
||||||||||
Salaries, wages and related expenses
|
3,580
|
4.1
|
30.7
|
31.8
|
||||||
Purchased transportation
|
(4,116
|
)
|
(7.4
|
)
|
17.5
|
20.4
|
||||
Fuel
|
21,872
|
42.2
|
24.9
|
18.9
|
||||||
Supplies and maintenance
|
6,551
|
18.2
|
14.4
|
13.1
|
||||||
Revenue equipment rent
|
(563
|
)
|
(2.1
|
)
|
9.0
|
9.9
|
||||
Depreciation
|
1,761
|
14.5
|
4.7
|
4.4
|
||||||
Communications and utilities
|
(140
|
)
|
(3.8
|
)
|
1.2
|
1.3
|
||||
Claims and insurance
|
2,440
|
22.7
|
4.5
|
3.9
|
||||||
Operating taxes and licenses
|
(120
|
)
|
(3.7
|
)
|
1.1
|
1.2
|
||||
Gain on sale of property and equipment
|
(642
|
)
|
108.4
|
(0.4
|
)
|
(0.2
|
)
|
|||
Miscellaneous
|
1,251
|
40.3
|
1.5
|
1.1
|
||||||
Total operating expenses
|
$
|
31,874
|
11.0
|
%
|
108.8
|
%
|
105.7
|
%
|
Level
|
Ratio
|
Base Rate Revolver Loans (other than Base Rate Equipment Loans)
|
LIBOR Revolver Loans (other than LIBOR Equipment Loans)
|
Base Rate Equipment Loans
|
LIBOR Equipment Loans
|
||||||
I
|
> 2.00 to 1.00
|
1.00 %
|
2.00 %
|
1.50 %
|
2.50 %
|
||||||
II
|
> 1.15 to 1.00 and < 2.00 to 1.00
|
1.25 %
|
2.25 %
|
1.75 %
|
2.75 %
|
||||||
III
|
< 1.15 to 1.00
|
1.50 %
|
2.50 %
|
2.00 %
|
3.00 %
|
(in thousands)
|
||||||||
Nine Months Ended September 30,
|
||||||||
2011
|
2010
|
|||||||
Net cash flows (used in) provided by operating activities
|
$
|
(17,547
|
)
|
$
|
6,993
|
|||
Net cash flows used in investing activities
|
(13,715
|
)
|
(9,096
|
)
|
||||
Net cash flows provided by financing activities
|
32,207
|
594
|
||||||
Borrowings under credit facility
|
28,352
|
-
|
(in thousands)
|
||||||||||||||||||||
Total
|
2011
|
2012-2013
|
2014-2015
|
After 2015
|
||||||||||||||||
Letters of credit
|
$
|
4,045
|
$
|
-
|
$
|
4,045
|
$
|
-
|
$
|
-
|
||||||||||
Purchase obligations
|
13,739
|
13,739
|
-
|
-
|
-
|
|||||||||||||||
Borrowings under credit facility
|
28,352
|
-
|
-
|
28,352
|
-
|
|||||||||||||||
Capital lease obligations, including interest
|
3,661
|
139
|
1,110
|
1,110
|
1,302
|
|||||||||||||||
Notes payable
|
6,601
|
253
|
2,168
|
2,434
|
1,746
|
|||||||||||||||
Operating leases obligations
|
||||||||||||||||||||
Rentals
|
97,190
|
9,035
|
52,039
|
20,026
|
16,090
|
|||||||||||||||
Residual guarantees
|
23,049
|
849
|
10,316
|
10,534
|
1,350
|
|||||||||||||||
$
|
176,637
|
$
|
24,015
|
$
|
69,678
|
$
|
62,456
|
$
|
20,488
|
Period
|
Total Number of Shares Purchased
(a)
|
Average Price Paid per Share
(b)
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(c)
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
(d)
|
||||
July 2011
|
-
|
$
|
-
|
-
|
752,900
|
|||
August 2011
|
5,700
|
3.30
|
5,700
|
747,200
|
||||
September 2011
|
- |
|
-
|
-
|
747,200
|
|||
Total
|
5,700
|
$
|
3.30
|
5,700
|
747,200
|
3.1
|
Restated Articles of Incorporation of Frozen Food Express Industries, Inc. (filed as Exhibit 3(i) to the Company’s Current Report on Form 8-K on May 29, 2007 and incorporated herein by reference).
|
3.2
|
Amended and Restated Bylaws of Frozen Food Express Industries, Inc., as amended (filed as Exhibit 99.1 to Registrant's Current Report on Form 8-K filed on March 3, 2011 and incorporated herein by reference).
|
31.1
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
|
|
32.1
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
101
|
The following financial statements from Frozen Food Express Industries, Inc. Form 10-Q for the quarter ended September 30, 2011, filed on October 28, 2011, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Condensed Balance Sheets, (ii) Consolidated Condensed Statement of Operations, (iii) Consolidated Condensed Statement of Cash Flows, (iv) Consolidated Condensed Statement of Shareholder’s Equity and (v) Notes to Consolidated Condensed Financial Statements, tagged as blocks of text.
|
FROZEN FOOD EXPRESS INDUSTRIES, INC.
|
||
(Registrant)
|
||
Dated: October 28, 2011
|
By
|
/s/ S. Russell Stubbs
|
S. Russell Stubbs
President and Chief Executive Officer
(Principal Executive Officer)
|
||
Dated: October 28, 2011
|
By
|
/s/ John R. McManama
|
John R. McManama
Senior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
|
3.1
|
Restated Articles of Incorporation of Frozen Food Express Industries, Inc. (filed as Exhibit 3(i) to the Company’s Current Report on Form 8-K on May 29, 2007 and incorporated herein by reference).
|
3.2
|
Amended and Restated Bylaws of Frozen Food Express Industries, Inc., as amended (filed as Exhibit 99.1 to Registrant's Current Report on Form 8-K filed on March 3, 2011 and incorporated herein by reference).
|
31.1
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
|
|
32.1
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
|
101
|
The following financial statements from Frozen Food Express Industries, Inc. Form 10-Q for the quarter ended September 30, 2011, filed on October 28, 2011, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Condensed Balance Sheets, (ii) Consolidated Condensed Statement of Operations, (iii) Consolidated Condensed Statement of Cash Flows, (iv) Consolidated Condensed Statement of Shareholder’s Equity and (v) Notes to Consolidated Condensed Financial Statements, tagged as blocks of text.
|
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1.
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I have reviewed this quarterly report on Form 10-Q for the period ended September 30, 2011 of Frozen Food Express Industries, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;
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5.
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The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Dated: October 28, 2011
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/s/ S. Russell Stubbs
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S. Russell Stubbs
President and Chief Executive Officer
(Principal Executive Officer)
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1.
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I have reviewed this quarterly report on Form 10-Q for the period ended September 30, 2011 of Frozen Food Express Industries, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;
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5.
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The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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Dated: October 28, 2011
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/s/ John R. McManama
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John R. McManama
Senior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
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(a)
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the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(b)
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the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Dated: October 28, 2011
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/s/ S. Russell Stubbs
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S. Russell Stubbs
President and Chief Executive Officer
(Principal Executive Officer)
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Dated: October 28, 2011
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/s/ John R. McManama
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John R. McManama
Senior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
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Consolidated Condensed Balance Sheets Parenthetical (USD $) | Sep. 30, 2011 | Dec. 31, 2010 |
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Shareholders' equity | ||
Common Stock, par value per share | $ 1.5 | $ 1.5 |
Common Stock, shares authorized | 75,000 | 75,000 |
Common Stock, shares issued | 18,572 | 18,572 |
Treasury Stock, shares | 960 | 1,146 |
Consolidated Condensed Statements of Operations (USD $) In Thousands, except Share data | 3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Consolidated Condensed Statements of Operations [Abstract] | ||||
Total operating revenue | $ 102,834 | $ 93,870 | $ 296,270 | $ 274,669 |
Operating expenses | ||||
Salaries, wages and related expenses | 31,766 | 30,243 | 90,868 | 87,288 |
Purchased transportation | 18,357 | 18,132 | 51,856 | 55,972 |
Fuel | 25,854 | 18,469 | 73,654 | 51,782 |
Supplies and maintenance | 15,710 | 13,447 | 42,561 | 36,010 |
Revenue equipment rent | 9,200 | 9,353 | 26,553 | 27,116 |
Depreciation | 4,827 | 4,216 | 13,875 | 12,114 |
Communications and utilities | 1,171 | 1,287 | 3,518 | 3,658 |
Claims and insurance | 7,476 | 3,486 | 13,204 | 10,764 |
Operating taxes and licenses | 985 | 1,003 | 3,089 | 3,209 |
Gain on sale of property and equipment | (661) | (12) | (1,234) | (592) |
Miscellaneous | 1,626 | 1,109 | 4,352 | 3,101 |
Total operating expenses | 116,311 | 100,733 | 322,296 | 290,422 |
Loss from operations | (13,477) | (6,863) | (26,026) | (15,753) |
Interest and other expense (income) | ||||
Interest income | (15) | (30) | ||
Interest expense | 247 | 105 | 479 | 308 |
Equity in earnings of limited partnership | (192) | (246) | (551) | (443) |
Life insurance and other | 63 | (43) | 432 | 84 |
Total interest and other expense (income) | 118 | (199) | 360 | (81) |
Loss before income taxes | (13,595) | (6,664) | (26,386) | (15,672) |
Income tax expense (benefit) | 73 | (4,383) | (1,476) | (5,241) |
Net loss | $ (13,668) | $ (2,281) | $ (24,910) | $ (10,431) |
Net loss per share of common stock | ||||
Basic | $ (0.77) | $ (0.13) | $ (1.42) | $ (0.61) |
Diluted | $ (0.77) | $ (0.13) | $ (1.42) | $ (0.61) |
Weighted average shares outstanding | ||||
Basic | 17,663 | 17,384 | 17,557 | 17,223 |
Diluted | 17,663 | 17,384 | 17,557 | 17,223 |
Document And Entity Information (USD $) | 9 Months Ended | ||
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Sep. 30, 2011 | Oct. 21, 2011 | Jun. 30, 2010 | |
Entity Registrant Name | Frozen Food Express Industries Inc | ||
Entity Central Index Key | 0000039273 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Public Float | $ 54,368,353 | ||
Entity Common Stock, Shares Outstanding | 17,743,382 | ||
Document Fiscal Year Focus | 2011 | ||
Document Fiscal Period Focus | Q3 | ||
Document Type | 10-Q | ||
Amendment Flag | false | ||
Document Period End Date | Sep. 30, 2011 |
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Related Party Transactions | 9 Months Ended |
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Sep. 30, 2011 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 6. Related Party Transactions The Company purchases trailers and trailer refrigeration units that are used in our operations from W&B Service Company, L.P. (“W&B”), an entity in which we own a 19.9% equity interest. The Company accounts for that investment under the equity method of accounting. As of September 30, 2011 and 2010, our equity investment in W&B was $1.5 million, which is included in "Other Assets" in the accompanying consolidated condensed balance sheets. For the nine months ended September 30, 2011 and 2010, our equity in the earnings of W&B before profit elimination was $0.7 million and $0.4 million, respectively. Cash distributions to us from W&B’s earnings were $1.0 million for the same period in 2011 and 2010, respectively. During the three months ended September 30, 2011 and 2010, the Company’s purchases from W&B for trailers and refrigeration units totaled $19.5 million and $11.5 million, respectively. During the nine month periods ended September 30, 2011 and 2010, the purchases were $23.1 million and $11.5 million, respectively. The Company also utilizes W&B to provide routine maintenance and warranty repair of trailers and refrigeration units. During the three months ended September 30, 2011 and 2010, W&B invoiced the Company $0.2 million and $0.3 million, respectively, for maintenance and repair services, accessories and parts. During the nine months ended September 30, 2011 and 2010, W&B invoiced the Company $0.8 million and $0.9 million, respectively, for maintenance and repair services, accessories and parts. |
Revenue Recognition | 9 Months Ended |
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Sep. 30, 2011 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | 2. Revenue Recognition Revenue and associated direct operating expenses are recognized on the date freight is picked up from the shipper. One of the preferable methods outlined in US GAAP provides for the recognition of revenue and direct costs when the shipment is completed. Changing to this method would not have a material impact on the interim financial statements. The Company is the sole obligor with respect to the performance of our freight services provided by owner operators or through our brokerage and logistics services business and we assume all related credit risk. Accordingly, our revenue and the related direct expenses are recognized on a gross basis on the date the freight is picked up from the shipper. Revenue from equipment rental is recognized ratably over the term of the associated rental agreements. |
Recent Accounting Pronouncements | 9 Months Ended |
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Sep. 30, 2011 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | 8. Recent Accounting Pronouncements We have reviewed recently issued accounting pronouncements and determined that they do not have a material impact on our consolidated financial statements. |
Assets held for sale | 9 Months Ended |
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Sep. 30, 2011 | |
Notes to Financial Statements [Abstract] | |
Assets held for sale | 9. Assets held for sale Revenue equipment categorized as assets held for sale, net of accumulated depreciation on the Consolidated Condensed Balance Sheet at September 30, 2011 totaled $10.8 million. Assets held for sale are no longer subject to depreciation, and are recorded at the lower of depreciated carrying value or fair market value less selling costs. We expect to sell these assets by the end of 2011 as stated below in Note 10, Subsequent Events. |
Commitments and Contingencies | 9 Months Ended |
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Sep. 30, 2011 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 7. Commitments and Contingencies The Company is involved in legal actions that arise in the ordinary course of business. Although the outcomes of any such legal actions cannot be predicted, in the opinion of management, the resolution of any currently pending or threatened actions will not have a material adverse effect upon our financial position or results of operations. The Company accrues for costs related to public liability, cargo, employee health insurance and work-related injury claims. When a loss occurs, we record a reserve for the estimated outcome. As additional information becomes available, adjustments are made. Accrued claims liabilities include all such reserves and our estimate for incidents that have been incurred but not reported. |
Long-term Debt | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term debt [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term debt | 3. Long-term Debt Long-term debt consisted of the following:
As of September 30, 2011, the Company had a secured committed credit facility with an aggregate availability of $50 million that matures in March 2015. At September 30, 2011, $28.4 million was borrowed under the credit facility and $4.0 million of standby letters of credit were issued under the credit facility, which are used primarily for our self-insurance programs and legal matters, reducing the availability under our credit facility to $17.6 million. As of September 30, 2011, loans outstanding under the credit facility were categorized as either LIBOR loans, which had an interest rate of 2.5%, or bank base rate loans which had an interest rate of 4.5%. 5 The obligations under the credit facility are guaranteed by our parent company and certain named subsidiaries and secured by a pledge of substantially all of our assets. The obligations shall bear interest (i) if a Base Rate Loan (as defined in the credit facility), at the Base Rate (as defined in the credit facility) in effect from time to time, plus the Applicable Margin (as defined in the credit facility); (ii) if a LIBOR loan, at LIBOR for the applicable interest period, plus the Applicable Margin; and (iii) if any other obligation (including, to the extent permitted by law, interest not paid when due), at the Base Rate in effect from time to time, plus the Applicable Margin for Base Rate Revolver Loans (as defined in the credit facility). Interest shall accrue from the date the Loan is advanced or the obligation is incurred or payable, until paid by the borrowers. If a loan is repaid on the same day made, one day's interest shall accrue. We are obligated to comply with certain covenants under the credit facility. During the third quarter of 2011 and in the normal course of business, the Company chose to enter into various master security agreements and a capital lease agreement as a different option from off-balance sheet operating leases to finance the purchase of revenue equipment at more favorable rates. The master security agreements provide for funding structured as promissory notes. The Company entered into these master security agreements to finance $6.7 million of revenue equipment in the third quarter of 2011. The effective interest rates on the promissory notes range from 5.5% to 6.4%. The capital lease obligation for approximately $3.0 million of revenue equipment is structured as a 60- month rental agreement with a fixed price purchase option. The effective interest rate on the lease is approximately 6.8%. The capital lease agreement requires us to pay personal property taxes, maintenance, and operating expenses. |
Income Taxes | 9 Months Ended |
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Sep. 30, 2011 | |
Income Taxes [Abstract] | |
Income Taxes | 4. Income Taxes The Company’s income is taxed in the United States of America and various state jurisdictions. Our federal returns for 2008 and each subsequent year are presently subject to further examination by the Internal Revenue Service. State returns are filed in most state jurisdictions, with varying statutes of limitations. The Company calculates income taxes in accordance with US GAAP which requires that, for interim periods, we project full-year income and permanent differences between book income and taxable income in order to calculate an effective tax rate for the entire year. The projected effective tax rate is used to calculate our income tax provision or benefit for the interim periods’ year-to-date financial results. Deferred tax assets and liabilities are measured using the tax rates, based on certain judgments regarding enacted tax laws and published guidance, in effect in the years when those temporary differences are expected to reverse. A valuation allowance is established against the deferred tax assets when it is more likely than not that some portion or all of the deferred taxes may not be realized. The calculation of the deferred tax assets and liabilities, as well as the decision to recognize a tax benefit from an uncertain position and to establish a valuation allowance require management to make estimates and assumptions. We believe that our assumptions and estimates are reasonable, although actual results may have a positive or negative material impact on the balances of deferred tax assets and liabilities, valuation allowances or net income (loss). Only the assumptions and estimates for the calendar year 2011 are used to determine the reasonableness of the Company’s deferred tax assets and liabilities as of the period ended September 30, 2011. Due to the operating results in the third quarter of 2011 and our projections for 2011, an adjustment to our valuation allowance was determined to be necessary. Therefore, for the nine months ended September 30, 2011, the Company recorded a valuation allowance totaling $7.2 million relating to federal and state deferred tax assets. For the nine months ended September 30, 2011, our effective tax benefit rate was 5.6% compared to 33.4% in the same period of 2010. This rate approximates our expected tax benefit rate for the entire year and has been applied to year-to-date results from operations. The difference between our effective tax rate and the federal statutory rate of 35% is primarily attributable to valuation allowances, non-deductible driver related expenses and state income taxes. |
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Loss per common share | 5. Loss per common share Basic and diluted loss per common share was computed as follows:
For the three months ended September 30, 2011 and 2010, options totaling 452,000 and 554,000, respectively, were outstanding, but were not included in the calculation of diluted weighted average shares as their exercise prices were greater than the average market price of the common shares. For the nine months ended September 30, 2011 and 2010, options totaling 443,000 and 552,000, respectively, were outstanding but were not included in the calculation of diluted weighted average shares as their exercise prices were greater than the average market price of the common shares. As of September 30, 2011, the Company has granted 366,000 deferred stock units which have a contractual participation right to share in current earnings and voting rights. These deferred stock units are included in basic weighted average shares outstanding. |
Basis of Presentation | 9 Months Ended |
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Sep. 30, 2011 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The accompanying unaudited consolidated condensed financial statements include Frozen Food Express Industries, Inc., a Texas corporation, and our subsidiary companies, all of which are wholly-owned (collectively, the “Company”). Our statements have been prepared by management in accordance with generally accepted accounting principles in the United States of America (“US GAAP”) for interim financial statements, and therefore do not include all information and disclosures required by US GAAP for complete financial statements. In the opinion of management, such statements reflect all adjustments consisting of normal recurring adjustments considered necessary to fairly present our consolidated financial position, results of operations, shareholders’ equity and cash flows for the interim periods presented. The results of operations for any interim period do not necessarily indicate the results for the full year. The unaudited interim consolidated condensed financial statements should be read with reference to the consolidated financial statements and notes to consolidated financial statements in our 2010 Annual Report on Form 10-K. All intercompany balances and transactions have been eliminated in consolidation. |
Subsequent Events | 9 Months Ended |
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Sep. 30, 2011 | |
Notes to Sinancial Statements [Abstract] | |
Subsequent Events | 10. Subsequent Events On October 5, 2011, the Company announced that it will restructure its dry-freight service offerings to improve operating efficiencies. The Company will continue to offer dry-freight options in certain lanes via the Company’s temperature-controlled trailers; however, it will no longer provide dry freight services via a dedicated fleet of dry van trailers. The Company will use the proceeds of these sales, which it anticipates to be approximately $15.5 million, to reduce debt. On October 20, 2011, the Company announced an agreement to sell substantially all trailers and most of the tractors related to our dry-freight services to a major transportation company specializing in these services. Further restructuring associated with this business decision are under review, which will include a reduction in back office work force and will be recorded in the fourth quarter of 2011 along with any additional costs related to the restructuring. |