-----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, Hx5AtsJLrCzBV8DPJE2psSqLpwrZPtsYcOR0XbpMIfg30vay+ShacEN8FXQcd1im q6GycE5qH547C5B16nkzXw== 0000700674-99-000009.txt : 19990517 0000700674-99-000009.hdr.sgml : 19990517 ACCESSION NUMBER: 0000700674-99-000009 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990514 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: 99622122 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 1ST QUARTER 1999-10-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 March 31, 1999 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 May 10, 1999 was 33,403,494 (Net of 1,807,502 Treasury Shares). AIR EXPRESS INTERNATIONAL CORPORATION March 1999 Form 10-Q Quarterly Report Table of Contents Part I - Financial Information Page Item 1. Financial Statements Condensed Consolidated Balance Sheets as at March 31, 1999 and December 31, 1998................. 2 Condensed Consolidated Statements of Operations - Three Months ended March 31, 1999 and 1998........... 3 Consolidated Statements of Cash Flows - Three Months ended March 31, 1999 and 1998........... 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.............................................. 12 Item 6. Exhibits and Reports on Form 8-K............................... 12 Page 2 AIR EXPRESS INTERNATIONAL CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands) March 31,1999 Dec 31,1998 (Unaudited) Assets Current Assets: Cash and cash equivalents .......................... $ 63,312 $ 60,246 Accounts receivable (less allowance for doubtful accounts of $5,218 and $5,112) ........... 356,859 366,417 Marketable securities .............................. -- 7,188 Other current assets ............................... 4,961 7,096 Total current assets ......................... 425,132 440,947 Investment in unconsolidated affiliates ............... 31,145 29,507 Restricted funds ...................................... 1,188 2,126 Property, plant and equipment (less accumulated depreciation of $70,914 and $70,515) ................. 82,713 81,178 Deposits and other assets ............................. 15,753 13,937 Goodwill (less accumulated amortization of $15,694 and $15,331) ................................. 104,593 107,783 Total assets ................................. $ 660,524 $ 675,478 Liabilities and stockholders' investment Current Liabilities: Current portion of long-term debt .................. $ 4,044 $ 4,337 Bank overdrafts payable ............................ 2,561 4,432 Transportation payables ............................ 166,056 157,763 Accounts payable ................................... 62,353 66,023 Accrued liabilities ................................ 62,202 72,780 Income taxes payable ............................... 10,851 6,644 Total current liabilities .................... 308,067 311,979 Long-term debt ..................................... 41,672 42,578 Other liabilities .................................. 6,906 10,050 Total liabilities ............................ 356,645 364,607 Stockholders' Investment: Capital stock- Preferred (authorized 1,000,000 shares, none outstanding) ..................................... -- -- Common, $.01 par value (authorized 100,000,000 shares, issued 35,195,996 and 35,028,154 shares) . 352 350 Additional paid-in capital ......................... 149,577 147,544 Accumulative other comprehensive income ............ (38,537) (28,192) Retained earnings .................................. 228,384 216,763 339,776 336,465 Less: 1,807,502 and 1,217,586 shares of treasury stock, at cost................................... (35,897) (25,594) Total stockholders' investment ..................... 303,879 310,871 Total liabilities and stockholders' investment ..... $ 660,524 $ 675,478 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 March 31, 1999 1998 Revenues ......................................... $354,684 $372,376 Operating expenses: Transportation .................................. 234,306 254,523 Terminal ........................................ 69,520 67,126 Selling, general and administrative ............. 38,954 37,571 Operating profit ................................. 11,904 13,156 Other income: Interest, net ................................... 76 357 Other, net ...................................... 9,645 2,055 9,721 2,412 Income before provision for income taxes ......... 21,625 15,568 Provision for income taxes ....................... 8,001 5,838 Net income ....................................... $ 13,624 $ 9,730 Income per common share: Basic ....................................... $ .40 $ .28 Diluted ..................................... $ .40 $ .28 Weighted average number of common shares: Basic ....................................... 33,690 34,639 Diluted ..................................... 33,892 35,381
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 THREE MONTHS ENDED MARCH 31, 1999 AND 1998 (Dollars in thousands) 1999 1998 Cash flows from operating activities: Net Income .......................................... $ 13,624 $ 9,730 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense ............................ 4,118 3,436 Amortization of goodwill ........................ 766 622 Deferred income taxes ........................... (948) (1,493) Equity in earnings of unconsolidated affiliates . (536) (1,069) (Gains) on sales of assets, net .................. (50) (8) (Gain) on sale of marketable securities .......... (7,852) -- Changes in assets and liabilities: (Increase) decrease in accounts receivable, net .. (708) 2,117 Decrease in other current assets ................ 1,906 862 (Increase) in other assets ....................... (681) (619) Increase (decrease) in transportation payables .. 11,764 (536) (Decrease) increase in accounts payable .......... (533) 1,939 (Decrease) in accrued liabilities ................ (9,072) (2,429) Increase (decrease) in income taxes payable ..... 4,932 (1,498) Increase in other liabilities ................... 68 78 Total adjustments ............................. 3,174 1,402 Net cash provided by operating activities ....... 16,798 11,132 Cash flows from investing activities: Restricted funds ................................... 938 3,808 Proceeds from sales of assets ...................... 84 283 Proceeds from sale of marketable securities ........ 7,877 -- Capital expenditures ............................... (6,903) (6,787) Investment in unconsolidated affiliates ............ (1,676) (7,040) Net cash provided (used) by investing activities 320 (9,736) Cash flows from financing activities: Net repayments in bank overdrafts payable .......... (1,679) (366) Additions to long-term debt ........................ 992 -- Payment of long-term debt .......................... (787) (39) Issuance of common stock ........................... 905 1,847 Payment of cash dividends .......................... (2,029) (1,728) Purchase of treasury stock ......................... (9,692) (96) Net cash used by financing activities ........... (12,290) (382) Effect of foreign currency exchange rates on cash ...... (1,762) (223) Net increase in cash and cash equivalents .............. 3,066 791 Cash and cash equivalents at beginning of period ....... 60,246 67,576 Cash and cash equivalents at end of period ............. $ 63,312 $ 68,367
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 March 31, 1999, the consolidated statements of operations for the three-month periods ended March 31, 1999 and 1998, and the consolidated statements of cash flows for the three-month periods ended March 31, 1999 and 1998 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 March 31, 1998 financial statements were reclassified to conform to the classification of March 31, 1999 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, 1998. 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-month period ended March 31, 1999 are not necessarily indicative of the results of operations expected for the full year ending December 31, 1999. B. Marketable securities: During the first quarter of 1999, the Company sold 30% of its investment in the equity securities of Equant, N.V., an international data network service provider, for a pre-tax gain of approximately $7.9 million (See Note D) and an after-tax gain of approximately $4.9 million or $.14 per diluted share. The remaining shares are not currently marketable and are carried at a cost of approximately $.1 million in the accompanying balance sheet. C. Interest, net was as follows: Three Months Ended March 31, 1999 1998 Interest expense ................ $(610) $(323) Interest income ................. 686 680 $ 76 $ 357
Page 6 D. Other, net was as follows: Three Months Ended March 31, 1999 1998 Gain on the sale of marketable securities ............................... $7,852 $ -- Equity in earnings of unconsolidated affiliates .............................. 1,143 1,574 Foreign exchange gains .................... 600 473 Other ..................................... 50 8 $9,645 $2,055
E. Comprehensive income: Three Months Ended March 31, 1999 1998 Net income ................................. $ 13,624 $ 9,730 Other comprehensive income, net of tax: Translation of foreign currency financial statements (income tax benefit of $387 and $138) ................ (6,218) (1,723) Reclassification adjustment for gain on sale of marketable securities included in net income(income tax expense of $3,061) ....................... (4,127) -- Comprehensive income ....................... $ 3,279 $ 8,007
F. Supplemental disclosures of cash flow information: Three Months Ended March 31, 1999 1998 Interest and income taxes paid: Interest.................................... $ 329 $ 222 Income taxes................................ 4,410 4,465 $ 4,739 $ 4,687
Page 7 G. Regional Operations: The Company operates its integrated logistics business as 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. Three Months Ended March 31, 1999 1998 Revenues by service: Airfreight ................................... $268,276 $291,530 Ocean freight ................................ 49,252 43,155 Customs brokerage & other .................... 37,156 37,691 Total revenues ............................... $354,684 $372,376 Revenues by geographic area: U.S.A ........................................ $141,395 $159,481 United Kingdom .............................. 34,956 39,279 Other ....................................... 74,129 75,727 Europe ....................................... 109,085 115,006 Asia and Others .............................. 104,204 97,889 Total foreign .............................. 213,289 212,895 Total revenues ............................... $354,684 $372,376 Operating profit by geographic area: U.S.A ........................................ $ 4,819 $ 2,814 Europe ....................................... 1,656 5,660 Asia and Others .............................. 5,429 4,682 Total foreign .............................. 7,085 10,342 Total operating profit ....................... $ 11,904 $ 13,156
Page 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations The Company operates its integrated logistics business as 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 Ended March 31, 1999 1998 Gross Revenues: Airfreight ....................................... $ 268.3 $ 291.5 Ocean freight .................................... 49.3 43.2 Customs brokerage and other ...................... 37.1 37.7 Total Gross Revenues ........................... $ 354.7 $ 372.4 Net Revenues: Airfreight ....................................... $ 76.0 $ 74.6 Ocean freight .................................... 15.4 12.5 Customs brokerage and other ...................... 29.0 30.8 Total Net Revenues ............................. 120.4 117.9 Internal Operating Expenses: Terminal ......................................... 69.5 67.1 Selling, general and administrative .............. 39.0 37.6 Total Internal Operating Expenses .............. 108.5 104.7 Operating Profit ................................... $ 11.9 $ 13.2
Consolidated gross revenues for the first quarter of 1999 decreased $17.7 million (4.8%) to $354.7 million compared with the first quarter of 1998. Consolidated net revenues increased $2.5 million (2.1%) to $120.4 million compared to the first quarter of 1998. The decrease in gross revenues was comprised of a $23.2 million (8.0%) decline in airfreight revenues, a $.6 million (1.6%) decline in customs brokerage and other revenues, and a $6.1 million (14.1%) increase in ocean freight revenues. The increase in net revenues was the result of increases in airfreight and ocean freight net revenues of $1.4 million (1.9%) and $2.9 million (23.2%), respectively, offset by a $1.8 million (5.8%) decline in customs brokerage and other net revenues. The decrease in airfreight gross revenues resulted from reduced shipping volumes and pricing pressures in certain markets. The increase in airfreight net revenues resulted from improvement in both the mix and routing of cargo and cost of transportation. As a result, the airfreight gross margin (net revenues as a percentage of gross revenues) increased 2.7% over the first quarter of 1998 to 28.3%. The increase in both gross and net ocean freight revenues was attributable to increased shipping activity, particularly from the United States and Far East, and lower ocean freight costs in certain markets. The decrease in customs brokerage and other net revenues was primarily due to a decline in warehouse and distribution activity and selling rates in several markets. Page 9 Internal operating expenses for the first quarter of 1999 increased $3.8 million (3.6%) over the first quarter of 1998. The increase was primarily the result of expenses related to acquisitions made subsequent to the first quarter of 1998, which contributed positively to the first quarter 1999 results, combined with an increase in information systems expenses including Year 2000 remediation and testing. Consolidated operating profit for the first quarter of 1999 decreased $1.3 million (9.8%) compared to the first quarter of 1998. Interest, net decreased $.3 million in the first quarter of 1999 compared to the first quarter of 1998. The decline resulted from higher interest expense associated with the increase in long-term debt. Other, net increased $7.6 million in the first quarter of 1999 compared to the first quarter of 1998. The increase resulted primarily from a $7.9 million gain on the sale of marketable securities (See Note B). The effective income tax rate for the first quarter of 1999 decreased to 37.0% compared to 37.5% for the first quarter of 1998. The decrease was largely the result of a change in the geographic composition of worldwide earnings to countries with lower effective income tax rates. United States gross revenues decreased $18.1 million (11.3%) to $141.4 million for the first quarter of 1999 compared to the first quarter of 1998. The decrease was comprised of a $18.6 million (14.6%) decline in airfreight revenues, a $1.3 million (8.9%) increase in ocean freight revenues and a $.8 million (5.1%) decrease in customs brokerage and other revenues. The decrease in airfreight revenues resulted from reduced domestic and export shipment activity. The increase in ocean freight revenues was due to increase shipments to new and existing customers. The decrease in customs brokerage and other revenues resulted from declines in both brokerage and warehousing activity. The United States gross margin in the first quarter of 1999 increased 5.7% over the first quarter of 1998 to 39.1%. The increase was mainly the result of improvement in the mix of cargo and lower transportation costs. The improved margin, coupled with a marginal increase in internal operating expenses, resulted in operating profit increasing $2.0 million over the first quarter of 1998 to $4.8 million. Foreign gross revenues increased marginally in the first quarter of 1999 to $213.3 million compared to the first quarter of 1998. European gross revenues decreased $5.9 million (5.1%) to $109.1 million. The decrease was comprised of a $7.2 million (7.9%) decline in airfreight revenues, a $1.2 million (9.2%) increase in ocean freight revenues and a marginal increase in customs brokerage and other revenues. The decrease in airfreight gross revenues was due to lower shipment activity and selling rates in certain markets. The increase in ocean freight gross revenues was attributable to greater shipping volumes from new and existing customers. Asia and Others gross revenues increased $6.3 million (6.5%) to $104.2 million. The increase was comprised of a $2.5 million (3.5%) increase in airfreight revenues, a $3.5 million (24.5%) increase in ocean freight revenues, and a $.3 million (2.9%) increase in customs brokerage and other Page 10 revenues. The increases in airfreight and ocean freight gross revenues were attributable to greater shipping volumes from existing and new customers. The increase in customs brokerage and other gross revenues resulted from acquisitions made subsequent to the first quarter of 1998. Foreign operating profit for the first quarter of 1999 decreased $3.3 million (31.5%) to $7.1 million compared with the first quarter of 1998. The European region's operating profit decreased $4.0 million (70.7%) compared to the first quarter of 1998. The decrease resulted primarily from weakness in both the United Kingdom and The Netherlands which experienced declines in airfreight shipments and selling rates. The Asia and Others region's operating profit increased $.7 million (16.0%) over the first quarter of 1998. Liquidity and Capital Resources At March 31,1999, cash and cash equivalents increased approximately $3.1 million to $63.3 million from $60.2 million at December 31, 1998. For the first quarter of 1999, the Company's primary sources of cash consisted of $16.8 million from operating activities and $7.9 million from the sale of marketable securities, while the primary uses of cash consisted of $9.7 million for the purchase of treasury stock and $6.9 million for capital expenditures. Cash flow from operating activities increased approximately $5.7 million over the first quarter of 1998. The increase was primarily from the increase in transportation payables and income taxes payable. Working capital decreased approximately $11.9 million in the quarter to $117.1 million. The decrease resulted primarily from the purchase of treasury stock. Capital expenditures for the quarter increased marginally over the first quarter of 1998 to $6.9 million. The $6.9 million of capital expenditures was primarily for improvement and expansion of facilities and management information services. At March 31, 1999, 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 $23.3 million, of which approximately $2.6 million was outstanding. The Company's Board of Directors has authorized the purchase from time to time in the open market of up to two million shares of the Company's common stock. During the first quarter of 1999, the Company purchased 557,500 of its common shares at a cost of approximately $9.7 million. As of March 31, 1999, the Company has purchased 1,635,000 of the two million shares authorized at a cost of approximately $31.7 million. 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. Page 11 Year 2000 In 1997, the Company undertook an assessment to determine the impact of Year 2000 compliance on its computer systems. This assessment resulted in preliminary plans to prepare the Company for Year 2000 readiness. These plans include remediation, upgrading or replacement of the Company's various systems including those utilizing embedded technology. In accordance with Issue 96-14 of the Emerging Issues Task Force of the Financial Accounting Standards Board, which requires the costs associated with modifying computer software for the Year 2000 to be expensed as incurred, the Company will expense the costs incurred to remediate the applicable systems. For 1998, the Company incurred approximately $3.6 million of expense and approximately $1.0 million of expense in 1997. Year 2000 expense for 1999 is anticipated to be approximately $2.5 million with approximately $1.1 million expended in the first quarter of 1999. The remediation of the Company's systems was approximately 99% completed by the end of the first quarter of 1999. Systems testing is scheduled to be completed by the end of June 1999. The systems testing will verify existing functionality and system operation before, during and after January 1, 2000. The testing will place particular emphasis on the high risk dates of December 31, 1999, January 1, 2000, February 29, 2000, March 1, 2000, and March 1, 2001. The Company believes that the remediation, upgrade and replacement of its systems will be ready for Year 2000 prior to any impact on its operations. If, however, the remediation, upgrade or replacement of the Company's systems is not completed timely, and negatively impacts the Company's Year 2000 readiness, the Company's operations may be materially adversely affected. In connection with this effort, the Company has initiated a program to communicate with its many customers and suppliers to determine the level of Year 2000 readiness of these entities and the potential impact on the Company's operations if these entities' computer systems are not ready. This program encompasses contacting the Company's major customers and its major suppliers - airlines, steamship lines, trucking companies, handling agents, customs authorities and other governmental agencies and financial institutions. During the third quarter and early fourth quarter of 1998, questionnaires were sent to the Company's significant suppliers. As of April 23, 1999, the Company surveyed approximately 1,400 of its significant suppliers - approximately 77% of those suppliers surveyed have advised the Company that they are currently Year 2000 compliant or expect compliance by September 30, 1999. Those suppliers who advised the Company of compliance after April 23, 1999 or who have not responded to the Company, will receive additional communication from the Company. Based upon responses, these suppliers will be evaluated for their level of compliance. For those suppliers deemed "at risk" for non-compliance, the Company will develop contingency plans wherever necessary. Contingency plans will include: redeployment of existing personnel and employing additional personnel to processes that were automated and will require manual intervention due to Year 2000 non-compliance, selection of alternative air carriers, steamship lines, trucking companies etc., customer notification of possible service disruptions in markets where carriers, aviation and/or customs authorities may not be Year 2000 compliant. Page 12 The Company's Year 2000 compliance evaluation of customers and suppliers is ongoing and the potential impact of non-compliance by the Company's customers and suppliers has not been determined. However, the Company does not warrant as true and accurate any assurance it receives from customers and suppliers regarding the compliance of its systems. The Company relies entirely on its transportation suppliers' airlines, steamship lines and independent trucking firms to transport its customers' cargo throughout its network. To the degree that the operations of any number of transportation providers are adversely effected by Year 2000, disruptions in the Company's business may occur which may have a material adverse effect on the Company's operations. New Accounting Standard In June 1998, the Financial Accounting Standards Board issued Statement No. 133, "Accounting for Derivative Instruments and Hedging Activities," which is required to be adopted in years beginning after June 15, 1999. The Statement establishes accounting and financial reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. The Company does not anticipate that the adoption of this Statement will have a material impact on either its results of operations or financial position. PART II - OTHER INFORMATION Item 1. - Legal Proceedings The Company is involved in various legal proceedings generally incidental to its business. While the result of any litigation contains an element of uncertainty, the Company presently believes that the outcome of any known pending or threatened legal proceeding or claim, or all of them combined, will not have a material adverse effect on its results of operations or 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 13 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: May 14, 1999 /s/ Dennis M. Dolan Dennis M. Dolan Executive Vice President and Chief Financial Officer (Principal Financial Officer) Date: May 14, 1999 /s/ Martin J. McDonnell Martin J. McDonnell 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 March 31, 1999 1998 Net income applicable to common shares ............. $13,624 $ 9,730 Earnings per share: Basic ............................................ $ .40 $ .28 Diluted .......................................... $ .40 $ .28 Common share and common share equivalents: Weighted average of common shares outstanding .............................. 33,690 34,639 Basic shares ..................................... 33,690 34,639 Common share equivalents (stock options) ......... 202 742 Diluted equivalent shares ........................ 33,892 35,381 Basic earnings per share is computed by dividing net income by the weighted average common shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted-average of common shares and common share equivalents outstanding during the period.
EX-27 3
5 1000 3-MOS DEC-31-1999 MAR-31-1999 63,312 0 362,077 5,218 0 425,132 153,627 70,914 660,524 308,067 41,672 352 0 0 377,961 660,524 0 354,684 0 234,306 69,520 306 610 21,625 8,001 13,624 0 0 0 13,624 .40 .40
-----END PRIVACY-ENHANCED MESSAGE-----