-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UNqb4piE/93rC2ytyE4y9qVkNOtf3Csbmz5oI2c+3+Tk7WfzUDbBmaLXHSLpcUNU GKrCqHlDMzApolsnfyibRA== 0000700674-97-000009.txt : 19971117 0000700674-97-000009.hdr.sgml : 19971117 ACCESSION NUMBER: 0000700674-97-000009 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: AIR EXPRESS INTERNATIONAL CORP /DE/ CENTRAL INDEX KEY: 0000700674 STANDARD INDUSTRIAL CLASSIFICATION: ARRANGEMENT OF TRANSPORTATION OF FREIGHT & CARGO [4731] IRS NUMBER: 362074327 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-08306 FILM NUMBER: 97718550 BUSINESS ADDRESS: STREET 1: 120 TOKENEKE RD PO BOX 1231 CITY: DARIEN STATE: CT ZIP: 06820 BUSINESS PHONE: 2036557900 MAIL ADDRESS: STREET 1: 120 TOKENEKE RD STREET 2: P O BOX 1231 CITY: DARIEN STATE: CT ZIP: 06820 10-Q 1 3RD QUARTER 1997-10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 1997 Commission file number: 1-8306 AIR EXPRESS INTERNATIONAL CORPORATION (Exact name of registrant as specified in its charter) Delaware 36-2074327 (State or Other Jurisdiction of (I.R.S. Employer Identification No.) Incorporation or Organization) 120 Tokeneke Road, Darien, Connecticut 06820 (203) 655-7900 (Address of, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices) NONE Former name, former address and former fiscal year, if changed since last report Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 3 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date (applicable only to corporate registrants). The number of shares of common stock outstanding as of November 12, 1997 was 34,526,143 (Net of 132,388 Treasury Shares). AIR EXPRESS INTERNATIONAL CORPORATION September 1997 Form 10-Q Quarterly Report Table of Contents Part I - Financial Information Page Item 1. Financial Statements Condensed Consolidated Balance Sheets as at September 30, 1997 and December 31, 1996............ 2 Condensed Consolidated Statements of Operations - three months and nine months ended September 30, 1997 and 1996............................................ 3 Consolidated Statements of Cash Flows - nine months ended September 30, 1997 and 1996....... 4 Notes to Condensed Consolidated Financial Statements.......................................... 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations............................ 8 Part II - Other Information Item 1. Legal Proceedings.............................................. 11 Item 6. Exhibits and Reports on Form 8-K............................... 11 Page 2 AIR EXPRESS INTERNATIONAL CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands) Sept 30, 1997 Dec 31, 1996 (Unaudited) Assets Current Assets: Cash and cash equivalents ......................... $ 64,346 $ 46,516 Accounts receivable, (less allowance for doubtful accounts of $4,302 and $4,721) .......... 372,355 346,323 Other current assets .............................. 7,460 6,295 Total current assets ........................ 444,161 399,134 Investment in unconsolidated affiliates .............. 18,821 13,991 Restricted funds ..................................... 18,692 -- Property, plant and equipment (less accumulated depreciation and amortization of $55,703 and $53,455) ........................................ 59,453 61,112 Deposits and other assets ............................ 16,758 15,226 Goodwill (less accumulated amortization of $11,982 and $10,673) ............................. 85,684 91,866 Total assets ................................ $ 643,569 $ 581,329 Liabilities and stockholders' investment Current Liabilities: Current portion of long-term debt ................. $ 3,010 $ 3,915 Bank overdrafts payable ........................... 1,580 2,058 Transportation payables ........................... 192,935 166,686 Accounts payable .................................. 51,562 50,201 Accrued liabilities ............................... 62,066 61,347 Income taxes payable .............................. 8,735 14,691 Total current liabilities ................... 319,888 298,898 Long-term debt .................................... 32,914 16,616 Other liabilities ................................. 6,454 6,729 Total liabilities ........................... 359,256 322,243 Stockholders' Investment: Capital stock- Preferred (authorized 1,000,000 shares, none outstanding) ................................ -- -- Common, $.01 par value (authorized 40,000,000 shares, issued 34,617,938 and 34,179,227 shares .. 346 342 Capital surplus ................................... 141,988 137,060 Cumulative translation adjustments ................ (22,776) (15,633) Retained earnings ................................. 168,106 137,989 287,664 259,758 Less: 131,451 and 40,958 shares of treasury stock, at cost ....................................... (3,351) (672) Total stockholders' investment .................... 284,313 259,086 Total liabilities and stockholders' investment .... $ 643,569 $ 581,329
The accompanying notes are an integral part of these financial statements. Page 3 AIR EXPRESS INTERNATIONAL CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share data) Three Months Ended Nine Months Ended September 30, September 30, 1997 1996 1997 1996 Revenues .................. $ 395,405 $ 340,928 $1,133,151 $ 956,375 Operating expenses: Transportation .......... 270,401 228,614 773,450 645,185 Terminal ................ 68,008 61,317 196,521 169,458 Selling, general and administrative ......... 37,258 35,457 111,744 100,411 Operating profit .......... 19,738 15,540 51,436 41,321 Other income (expense): Interest, net ........... 375 258 853 (1,557) Other, net .............. 1,179 1,060 3,531 3,087 1,554 1,318 4,384 1,530 Income before provision for income taxes ......... 21,292 16,858 55,820 42,851 Provision for income taxes 7,929 6,232 20,876 16,369 Net income ................ $ 13,363 $ 10,626 $ 34,944 $ 26,482 Income per common share: Primary ............... $ .38 $ .32 $ 1.00 $ .85 Fully diluted ......... $ .38 $ .31 $ .99 $ .81 Weighted average number of common shares (000's): Primary ............... 35,446 33,537 35,034 31,097 Fully diluted ......... 35,628 34,685 35,354 34,611
The accompanying notes are an integral part of these financial statements. Page 4 AIR EXPRESS INTERNATIONAL CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996 (Dollars in thousands) 1997 1996 Cash flows from operating activities: Net income ......................................... $ 34,944 $ 26,482 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization .................... 9,868 7,214 Amortization of goodwill ......................... 1,935 1,754 Amortization of bond discount .................... -- 115 Deferred income taxes ............................ (85) 357 Equity in earnings of unconsolidated affiliates .. (1,834) (983) Losses (gains) on sales of assets ................ 12 (129) Changes in assets and liabilities, net of business acquisitions: (Increase) in accounts receivable, net ............ (31,143) (16,079) (Increase) decrease in other current assets ....... (557) 55 (Increase) decrease in other assets ............... (1,456) 1,764 Increase (decrease) in transportation payables ... 28,357 (12,744) Increase (decrease) in accounts payable .......... 2,620 (5,902) Increase in accrued liabilities .................. 816 4,732 (Decrease) increase in income taxes payable ....... (5,229) 1,979 (Decrease) in other liabilities ................... (75) (1,181) Total adjustments ............................ 3,229 (19,048) Net cash provided by operating activities ....... 38,173 7,434 Cash flows from investing activities: Business acquisitions, net of cash acquired ....... -- (7,386) Restricted funds .................................. (18,692) -- Other investing activities ........................ 700 (1,320) Proceeds from sales of assets ..................... 624 381 Capital expenditures .............................. (12,038) (8,959) Investment in unconsolidated affiliates ........... (3,776) (71) Net cash used in investing activities ........... (33,182) (17,355) Cash flows from financing activities: Net (repayments) borrowings in bank overdrafts payable ............................................ (418) 627 Additions to long-term debt ......................... 19,055 290 Payment of long-term debt ........................... (1,564) (1,297) Issuance of common stock ............................ 4,932 1,479 Payment of cash dividends ........................... (4,466) (3,218) Purchase of treasury stock .......................... (2,679) (55) Net cash provided (used) by financing activities ..................................... 14,860 (2,174) Effect of foreign currency exchange rates on cash ....... (2,021) (907) Net increase (decrease) in cash and cash equivalents .... 17,830 (13,002) Cash and cash equivalents at beginning of period ........ 46,516 54,463 Cash and cash equivalents at end of period .............. $ 64,346 $ 41,461
The accompanying notes are an integral part of these financial statements. Page 5 AIR EXPRESS INTERNATIONAL CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS A. The consolidated balance sheet at September 30, 1997, the consolidated statements of operations for the three-month and nine-month periods ended September 30, 1997 and 1996, and the consolidated statements of cash flows for the nine-month periods ended September 30, 1997 and 1996 were prepared by the Company without audit. In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations, and cash flows for the interim periods were made. Certain items in the September 30, 1996 financial statements were reclassified to conform to the classification of September 30, 1997 financial statements. Certain information and footnote disclosures, normally included in financial statements prepared in accordance with generally accepted accounting principles, were condensed or omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's annual report to stockholders for the year ended December 31, 1996. Statements included herein which are not historical facts are forward-looking statements. These statements are based upon information available to the Company on the date hereof. Inherent in these statements are a variety of risks and other factors, both known and unknown, which may cause the Company's actual results to differ materially from those in forward-looking statements. Accordingly, the realization of forward-looking statements is not certain, and all such statements should be evaluated based upon the applicable risks and uncertainties affecting the Company. Consequently, the results of operations for the three and nine month periods ended September 30, 1997 are not necessarily indicative of the results of operations expected for the full year ending December 31, 1997. B. Interest, net was as follows: Three Months Ended Nine Months Ended September 30, September 30, 1997 1996 1997 1996 Interest expense ........ $ (310) $ (355) $(1,089) $(3,367) Interest income ......... 685 613 1,942 1,810 $ 375 $ 258 $ 853 $(1,557)
C. Other, net was as follows: Three Months Ended Nine Months Ended September 30, September 30, 1997 1996 1997 1996 Equity in earnings of unconsolidated affiliates ............. $ 986 $ 600 $ 2,603 $ 1,780 Foreign exchange gains .. 171 431 940 1,178 Other ................... 22 29 (12) 129 $ 1,179 $ 1,060 $ 3,531 $ 3,087
Page 6 D. Supplemental disclosures of cash flow information: Three Months Ended Nine Months Ended September 30, September 30, 1997 1996 1997 1996 Interest and income taxes paid: Interest ............... $ 101 $ 216 $ 652 $ 2,776 Income taxes ........... 5,014 3,703 19,458 9,825 $ 5,115 $ 3,919 $ 20,110 $12,601
Non-cash investing and financing activities: On July 8, 1996, as a result of conversions of the 6.0% Convertible Subordinated Debentures ("Debentures"), the Company issued 4,936,134 shares of its Common Stock valued at approximately $74.5 million. E. Common Stock Split: On June 19, 1997, the Company's Board of Directors declared a three-for-two split of the Company's Common Stock, payable in the form of a stock dividend. The additional shares were distributed on July 25, 1997 to shareholders of record on July 11, 1997. Accordingly, all share and per share information throughout the consolidated financial statements have been restated to reflect this split. F. Long-Term Debt: The Company entered into a ground lease agreement dated July 1, 1997 with the Port Authority of New York/New Jersey in conjunction with a lease development agreement entered into with the New York City Industrial Development Agency for the construction of a 135,000 square foot air cargo facility terminal building at John F. Kennedy International Airport. The Company will finance the development in part through the issuance of tax-exempt New York City Industrial Development Agency Special Facility Revenue Bonds (1997 Air Express International Corporation Project), Series 1997, in aggregate principal amount of $19.0 million due July 1, 2024 (the "Series 1997 Bonds"). Interest shall initially be payable at a weekly rate set by the Remarketing Agent using the minimum rate necessary (as determined by the Remarketing Agent based on the examination of tax-exempt obligations comparable to the Series 1997 Bonds known by the Remarketing Agent to have been priced or traded under then-prevailing market conditions) for the Remarketing Agent to sell the Series 1997 Bonds on the effective date of such weekly rate at a price equal to 100% of their principal amount (without regard to accrued interest). The Company may from time to time change the method of determining the interest rate on the Series 1997 Bonds to a daily, weekly, Page 7 commercial paper or long-term interest rate. If the appropriate interest rate is not or cannot be determined for whatever reason, the method of determining interest on the Series 1997 Bonds shall be equal to the Public Securities Association Municipal Index or such other weekly high-grade index comprised of seven-day, tax-exempt variable rate demand notes produced by Municipal Market Data, Inc. In no event shall the interest rate on the Series 1997 Bonds exceed the maximum annual interest rate of 15.0%. The Series 1997 Bonds are fully secured by an irrevocable direct-pay letter of credit issued by a U.S. Bank with a termination date of July 16, 2002. The Company is obligated to reimburse the U.S. Bank for amounts drawn under the letter of credit in accordance with a reimbursement agreement between the Company and the U.S. Bank (the "Reimbursement Agreement"). The Series 1997 Bonds may be redeemed in whole or in part at the direction of the Company. Among the various covenants contained in the Reimbursement Agreement, the Company is to maintain certain ratios and balances as to minimum stockholders' investment, debt to stockholders' investment and fixed charge coverage. The Company is in compliance with all conditions of the Reimbursement Agreement. G. Restricted Funds: The restricted funds consist of cash and investments held in trust and committed for the construction of an air cargo facility terminal building in accordance with the Company's bond indenture (See Note F). Investments are stated at cost as it is the intent of the Company to hold the investments until maturity. The funds are invested in compliance with the Company's bond indenture which restricts the type, quality and maturity of investments. H. Subsequent Event: During October 1997, the Company sold its 60.0% interest in a foreign subsidiary for cash of approximately $3.2 million. The sale will result in a nonrecurring pre-tax gain of approximately $1.9 million, or $1.5 million after tax, which will be included in the fourth quarter 1997 results of operations. Page 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations The Company considers its total business to represent a single segment comprised of three major services: airfreight forwarding, ocean freight forwarding, and customs brokerage and other services, all of which are fully integrated. The following table sets forth the gross revenues and net revenues (gross revenues minus transportation expenses) for each of these three service categories, as well as the Company's internal operating expenses (terminal, selling, general and administrative expenses) and operating profit: Three Months Nine Months Ended September 30, Ended September 30, 1997 1996 1997 1996 Gross Revenues: Airfreight ........................... $305.9 $257.5 $ 875.2 $733.5 Ocean freight ........................ 54.3 50.4 152.0 139.9 Customs brokerage and other .......... 35.2 33.0 106.0 83.0 Total Gross Revenues ............... $395.4 $340.9 $1,133.2 $956.4 Net Revenues: Airfreight ........................... $ 79.7 $ 69.4 $ 226.2 $198.9 Ocean freight ........................ 15.4 13.3 43.9 37.8 Customs brokerage and other .......... 29.9 29.6 89.6 74.5 Total Net Revenues ................. 125.0 112.3 359.7 311.2 Internal Operating Expenses: Terminal ............................. 68.0 61.3 196.5 169.5 Selling, general and administrative... 37.3 35.5 111.8 100.4 Total Internal Operating Expenses... 105.3 96.8 308.3 269.9 Operating Profit ....................... $ 19.7 $ 15.5 $ 51.4 $ 41.3
Consolidated gross revenues for the third quarter and nine months ended September 30, 1997 increased 16.0% to $395.4 million and 18.5% to $1,133.2 million, respectively, over the comparable periods in 1996. Additionally, the increase in gross revenues for the quarter and nine months included the negative effect of approximately $15.3 million and $26.0 million, respectively, resulting from a stronger U.S. dollar when converting foreign currency revenues into U.S. dollars for financial reporting purposes. Consolidated net revenues for the third quarter and first nine months of 1997 increased 11.3% to $125.0 million and 15.6% to $359.7 million, respectively, over the comparable 1996 periods. Gross airfreight revenues for the third quarter and first nine months of 1997 increased 18.8% to $305.9 million and 19.3% to $875.2 million, respectively, over the comparable 1996 periods. Airfreight net revenues for the third quarter and first nine months of 1997 increased 14.8% to $79.7 million and 13.7% to $226.2 million, respectively, over the comparable 1996 periods. The increases in gross and net revenues from airfreight services for both the Page 9 quarter and nine months were attributable to increases in shipments and the total weight of cargo shipped. For the quarter, shipments increased 18.8% and the weight of cargo shipped increased 15.0% over the third quarter of 1996. The significant increase in the number of shipments in the quarter was due to a large increase in United States domestic shipments (the United States domestic business accounted for only 3.0% of consolidated revenues for the third quarter). Excluding United States domestic shipments, the increase in airfreight shipments was 8.0% for the quarter. For the nine month period, shipments increased 15.3% and the weight of cargo shipped increased 17.7% over the first nine months of 1996. The gross margin (net revenues as a percentage of gross revenues) for the third quarter and first nine months of 1997 decreased .9% from 27.0% to 26.1% and 1.3% from 27.1% to 25.8%, respectively, when compared to the comparable 1996 periods. The decreases were mainly due to reduced yields associated with the increases in the weight of cargo shipped. Ocean freight gross revenues for the third quarter and first nine months of 1997 increased 7.7% to $54.3 million and 8.6% to $152.0 million, respectively, over the comparable 1996 periods. Ocean freight net revenues for the third quarter and first nine months of 1997 increased 15.8% to $15.4 million and 16.1% to $43.9 million, respectively, over the comparable 1996 periods. The increases in both the gross and net ocean freight revenues were due to increased shipping volumes from existing customers and the Company's continuing penetration into the ocean freight market. Customs brokerage and other gross revenues for both the third quarter and first nine months of 1997 increased 6.7% to $35.2 million and 27.7% to $106.0 million, respectively, over the comparable 1996 periods. Customs brokerage and other net revenues for the third quarter and first nine months of 1997 increased 1.0% to $29.9 million and 20.3% to $89.6 million, respectively, over the comparable 1996 periods. The slight increase in customs brokerage and other net revenues in the third quarter reflected the increase in foreign activity which was offset by a decrease in the United States. The decrease in the United States was due to a decline in the Canadian border activity. The increases for the first nine months of 1997 for both the gross and net customs brokerage and other revenues were mainly attributable to the Company's continuing efforts to expand its customs brokerage activities to existing and new customers. Internal operating expenses increased $8.5 million or 8.8% for the third quarter and $38.4 million or 14.2% for the first nine months of 1997 over the comparable periods in 1996. These increases were mainly attributable to the additional expenses incurred in connection with greater shipping volumes. Operating profit for the third quarter of 1997 increased $4.2 million or 27.1% over the third quarter of 1996. For the first nine months of 1997, operating profit increased $10.1 million or 24.5% over the comparable 1996 period. Interest expense for the third quarter of 1997 was marginally lower than the comparable 1996 period. For the first nine months of 1997, interest expense decreased approximately $2.3 million when compared to the comparable 1996 period. The decrease was due primarily to the elimination of interest expense associated with the Debentures (See Note D) which were converted on or before July 8, 1996. Page 10 The effective income tax rate for the third quarter of 1997 was marginally higher than the comparable 1996 period. For the first nine months of 1997, the effective income tax rate decreased to 37.4% from 38.2% for the comparable 1996 period. The decrease was largely the result of a shift in the mix of worldwide earnings to countries with lower effective income tax rates, along with a reduction in the total of nondeductible expenses as a percentage of pre-tax income. During October 1997, the Company sold its 60.0% interest in a foreign subsidiary (See Note H). As a result, the Company will record a nonrecurring pre-tax gain of approximately $1.9 million, or $1.5 million after tax, in the fourth quarter of 1997. In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, Earnings Per Share ("FASB 128"), which establishes standards for computing and presenting earnings per share. FASB 128 will be effective for periods ending after December 15, 1997. Adoption of this accounting standard is not expected to have a material impact upon the Company's earnings per share computations assuming the current capital structure. Liquidity and Capital Resources At September 30, 1997, cash and cash equivalents increased approximately $17.8 million to $64.3 million from $46.5 million at December 31, 1996. For the first nine months of 1997, the Company's primary source of cash was approximately $38.2 million from operating activities, while its primary uses were for: capital expenditures of $12.0 million, investment in unconsolidated affiliates of $3.8 million and dividend payments of $4.5 million. Cash flow provided by operating activities increased approximately $30.7 million over the first nine months of 1996. This increase was impacted by the on-going integration of prior years' acquisitions which has resulted in improvements in the management of working capital. Working capital increased approximately $24.0 million in the nine months to $124.3 million. The increase was mainly due to the increase in profits. Capital expenditures increased approximately $3.0 million from $9.0 million for the nine months of 1996 to $12.0 million for the nine months of 1997. The capital expenditures were primarily for improvement and expansion of facilities and management information services. At September 30, 1997, the Company had available for future borrowings approximately $71.8 million of its $75.0 million revolving credit facility. The Company utilized approximately $3.2 million under this facility mainly for letters of credit issued in connection with its insurance programs. Additionally, various of the Company's foreign subsidiaries maintained overdraft facilities with foreign banks, aggregating approximately $18.1 million, of which approximately $1.6 million was outstanding. Page 11 In July 1997, with the issuance of the Industrial Development Revenue Bonds (See Note F), the Company's long-term debt increased $19.0 million and correspondingly its debt to equity ratio (total long-term debt as a percentage of stockholders' investment) was 12.6% at September 30, 1997 as compared to 7.9% at December 31, 1996. In June 1997, the Company's Board of Directors authorized an increase in the quarterly cash dividend from four cents ($.04) to five cents ($.05) per share. Management believes that the Company's available cash and sources of credit, together with expected future sources of credit and cash generated from operations, will be sufficient to satisfy its anticipated needs for working capital, capital expenditures and dividends. PART II - OTHER INFORMATION Item 1. - Legal Proceedings The Company believes that there are no legal proceedings, other than ordinary routine litigation incidental to the business of the Company, to which the Company or any of its subsidiaries is a party. Management is of the opinion that the ultimate outcome of existing legal proceedings, if adverse, would not have a material effect on the Company's consolidated financial position. Item 6. - Exhibits and Reports on Form 8-K a) Exhibits: Exhibit 11 - Computation of Earnings Per Common Share. Exhibit 27 - Financial Data Schedule. b) Reports on Form 8-K: None. Page 12 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Air Express International Corporation (Registrant) Date: November 14, 1997 /s/ Dennis M. Dolan Dennis M. Dolan Vice President and Chief Financial Officer (Principal Financial Officer) Date: November 14, 1997 /s/ Walter L. McMaster Walter L. McMaster Vice President - Controller (Principal Accounting Officer) EX-11 2 COMPUTE EARNINGS PER COMMON SHARE
Exhibit 11 AIR EXPRESS INTERNATIONAL CORPORATION AND SUBSIDIARIES COMPUTATION OF EARNINGS PER COMMON SHARE (Unaudited) (In thousands, except per share amounts) Three Months Ended Nine Months Ended September 30, September 30, 1997 1996 1997 1996 Primary: Net income applicable to common shares .................... $13,363 $10,626 $34,944 $26,482 Weighted average of common shares outstanding ............... 34,428 32,904 34,302 30,560 Common share equivalents ........... 1,018 633 732 537 Average common shares out- standing ......................... 35,446 33,537 35,034 31,097 Earnings per common share .......... $ .38 $ .32 $ 1.00 $ .85 Fully diluted: Weighted average of common shares outstanding ............... 34,428 32,904 34,302 30,560 Common share equivalents ........... 1,200 663 1,052 641 Common shares issuable upon assumed conversion of subor- dinated debentures ............... -- 1,118 -- 3,410 Average common shares outstanding ...................... 35,628 34,685 35,354 34,611 Earnings per common share .......... $ .38 $ .31 $ .99 $ .81 Primary earnings per share was computed by dividing net income by the weighted average common and common share equivalents outstanding during the period. For the quarter and nine months ended September 30, 1996, fully diluted earnings per share was calculated assuming the conversion of the Debentures and the elimination of the associated interest expense, net of tax, of approximately $.73 million and $1.46 million, respectively. Effective July 8, 1996, the Company completed the redemption for all of its Debentures. Therefore, the Debentures and related interest expense were not a component of the Company's fully diluted earnings per share calculation for the quarter and nine months ended September 30, 1997.
EX-27 3
5 1000 9-MOS DEC-31-1997 SEP-30-1997 64,346 0 376,657 4,302 0 444,161 115,156 55,703 643,569 319,888 32,914 346 0 0 310,094 643,569 0 1,133,151 0 773,450 196,521 805 1,089 55,820 20,876 34,944 0 0 0 34,944 1.00 .99
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