-----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, FEWNQbz28qzGsrvD6fwIrIaZcp7aKb2l1+gByV50lIwRi5Yv6MIpMGwLXZgJ10ru 9TaUqRsufdnmYkOegsv+Kw== 0000846729-99-000017.txt : 19990806 0000846729-99-000017.hdr.sgml : 19990806 ACCESSION NUMBER: 0000846729-99-000017 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19990805 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN FREIGHTWAYS CORP CENTRAL INDEX KEY: 0000846729 STANDARD INDUSTRIAL CLASSIFICATION: TRUCKING (NO LOCAL) [4213] IRS NUMBER: 742391754 STATE OF INCORPORATION: AR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-17570 FILM NUMBER: 99678032 BUSINESS ADDRESS: STREET 1: 2200 FORWARD DR CITY: HARRISON STATE: AR ZIP: 72601 BUSINESS PHONE: 5017419000 MAIL ADDRESS: STREET 1: 2200 FORWARD DR CITY: HARRISON STATE: AR ZIP: 72601 10-Q 1 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1999 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File No. 34-0-17570 AMERICAN FREIGHTWAYS CORPORATION (Exact name of registrant as specified in its charter) Arkansas 74-2391754 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 2200 Forward Drive, Harrison, Arkansas 72601 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (870) 741-9000 Not Applicable (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 Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 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. [X] Yes [ ] No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Number of shares of common stock outstanding at June 30, 1999: 31,930,933. PART I. FINANCIAL INFORMATION Item 1. Financial Statements AMERICAN FREIGHTWAYS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (000's omitted)
JUNE 30, December 31, 1999 1998 --------- --------- (UNAUDITED) (Note) ASSETS Current assets Cash and cash equivalents $ 6,251 $ 3,274 Trade receivables, less allowance for doubtful accounts (1999-$2,385; 1998-$1,937) 120,112 94,464 Operating supplies and inventories 4,796 4,139 Prepaid expenses 8,970 11,318 Deferred income taxes 26,191 19,089 Income taxes receivable 3,238 2,763 --------- --------- Total current assets 169,558 135,047 Property and equipment 818,756 777,705 Accumulated depreciation and amortization (295,049) (272,960) --------- --------- 523,707 504,745 Other assets 2,129 2,269 --------- --------- $ 695,394 $ 642,061 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Trade accounts payable $ 14,428 $ 16,766 Accrued expenses 98,362 70,809 Current portion of long-term debt 11,772 19,679 --------- --------- Total current liabilities 124,562 107,254 Long-term debt, less current portion (Note B) 222,060 206,115 Deferred income taxes 70,419 72,678 Shareholders' equity Common stock, par value $.01 per share--authorized 250,000 shares; issued and outstanding 31,931 in 1999 and 31,695 in 1998 319 317 Additional paid-in capital 108,493 106,053 Retained earnings 169,666 149,769 Treasury stock, at cost, 15 shares in 1999 and 1998 (125) (125) --------- --------- 278,353 256,014 --------- --------- $ 695,394 $ 642,061 ========= =========
Note: The condensed consolidated balance sheet at December 31, 1998, has been derived from the audited consolidated financial statements at that date. See notes to condensed consolidated financial statements. AMERICAN FREIGHTWAYS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (000's omitted, except per share data)
Three Months Ended Six Months Ended June 30, June 30, 1999 1998 1999 1998 -------------------- -------------------- OPERATING REVENUE $ 291,173 $ 246,402 $ 556,577 $ 477,051 OPERATING EXPENSES AND COSTS Salaries, wages and benefits 175,497 149,547 337,941 292,977 Operating supplies and expenses 22,027 20,163 42,271 40,180 Operating taxes and licenses 11,115 10,446 21,926 20,441 Insurance 9,351 7,376 18,650 14,517 Communications and utilities 4,863 4,756 9,239 8,711 Depreciation and amortization 14,301 13,772 29,811 27,581 Rents and purchased transportation 17,120 14,416 34,265 27,435 Other 12,126 10,039 22,875 20,017 --------- --------- --------- --------- 266,400 230,515 516,978 451,859 --------- --------- --------- --------- OPERATING INCOME 24,773 15,887 39,599 25,192 OTHER INCOME (EXPENSE) Interest expense (3,802) (3,925) (7,488) (8,013) Interest income 101 65 184 129 Gain on disposal of assets 969 820 1,120 841 Other, net 13 24 25 52 --------- --------- --------- --------- (2,719) (3,016) (6,159 (6,991) INCOME BEFORE INCOME TAXES 22,054 12,871 33,440 18,201 --------- --------- --------- --------- FEDERAL AND STATE INCOME TAXES Current 13,328 4,156 22,905 5,383 Deferred (credit) (4,396) 1,057 (9,362) 1,988 --------- --------- --------- --------- 8,932 5,213 13,543 7,371 --------- --------- --------- --------- NET INCOME $ 13,122 $ 7,658 $ 19,897 $ 10,830 ========= ========= ========= ========= PER SHARE (NOTE D) Net income-basic $ 0.41 $ 0.24 $ 0.63 $ 0.34 Net income-assuming dilution $ 0.40 $ 0.24 $ 0.61 $ 0.34 ========= ========= ========= ========= AVERAGE SHARES OUTSTANDING (NOTE D) Basic 31,860 31,612 31,799 31,590 Assuming dilution 32,643 31,752 32,436 31,688 ========= ========= ========= =========
See notes to condensed consolidated financial statements. AMERICAN FREIGHTWAYS CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (000's omitted)
Six Months Ended June 30, 1999 1998 -------- -------- NET CASH PROVIDED BY OPERATING ACTIVITIES $ 40,664 $ 39,892 INVESTING ACTIVITIES Proceeds from sales of assets 1,630 1,963 Capital expenditures (49,418) (38,223) -------- -------- Net cash used by investing activities (47,788) (36,260) FINANCING ACTIVITIES Principal payments on long-term debt (27,962) (15,665) Proceeds from notes payable and long-term borrowings 36,000 15,208 Proceeds from issuance of common stock 2,063 668 -------- -------- Net cash provided by financing activities 10,101 211 -------- -------- NET INCREASE IN CASH AND CASH EQUIVALENTS $ 2,977 $ 3,843 ======== ========
See notes to condensed consolidated financial statements. AMERICAN FREIGHTWAYS CORPORATION AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) June 30, 1999 NOTE A - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of Management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results of the six month period ended June 30, 1999, are not necessarily indicative of the results that may be expected for the year ending December 31, 1999. For further information, refer to the Company's consolidated financial statements and footnotes thereto included in Form 10-K for the year ended December 31, 1998. NOTE B - LONG-TERM DEBT As of June 30, 1999, the Company has outstanding borrowings of $89,000,000 under its existing $160,000,000 unsecured revolving line of credit. The proceeds of these borrowings were used for the purchase of revenue equipment and for the purchase and construction of customer center facilities. At June 30, 1999, the amount available for borrowing under the line of credit was $71,000,000. In addition to this credit facility, the Company has obtained letters of credit totaling $4,095,000 to provide collateral on its self-insurance plan. As of June 30, 1999, the Company has outstanding borrowings of $123,250,000 under an unsecured and uncommitted Master Shelf Agreement which provides for the issuance of up to $140,000,000 of senior promissory notes with an average life not to exceed twelve years. In addition, the Company has outstanding an unsecured senior note for $15,000,000 payable in equal annual installments of $5,000,000 through November 2001. NOTE C - COMMITMENTS Commitments for the purchase of revenue equipment and the purchase or construction of customer centers aggregated approximately $68,951,000 at June 30, 1999. NOTE D - EARNINGS PER SHARE Net income for purposes of basic earnings per share and earnings per share--assuming dilution was $13,122,000 and $7,658,000 for the three month periods ended June 30, 1999 and 1998, respectively. For the six month periods ended June 30, 1999 and 1998, net income for purposes of basic earnings per share and earnings per share-- assuming dilution was $19,897,000 and $10,830,000, respectively. A reconciliation of average shares outstanding for these periods is presented below:
Three Months Ended Six Months Ended June 30, June 30, 1999 1998 1999 1998 --------------- --------------- (In Thousands) (In Thousands) Average shares outstanding-basic 31,860 31,612 31,799 31,590 Effect of dilutive stock options 783 140 637 98 Average shares outstanding- assuming dilution 32,643 31,752 32,436 31,688
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations The following table sets forth, for the periods indicated, the percentages of operating expenses and other items to operating revenue:
Three Months Six Months Ended Ended June 30, June 30, 1999 1998 1999 1998 ------------- -------------- Operating revenue 100.0% 100.0% 100.0% 100.0% Operating expenses and costs: Salaries, wages and benefits 60.3% 60.7% 60.7% 61.4% Operating supplies and expenses 7.6% 8.2% 7.6% 8.4% Operating taxes and licenses 3.8% 4.2% 3.9% 4.3% Insurance 3.2% 3.0% 3.4% 3.0% Communications and utilities 1.7% 1.9% 1.7% 1.8% Depreciation and amortization 4.9% 5.6% 5.4% 5.8% Rents and purchased transportation 5.9% 5.9% 6.2% 5.8% Other 4.1% 4.1% 4.0% 4.2% ------------------------------ Total operating expenses and costs 91.5% 93.6% 92.9% 94.7% ------------------------------ Operating income 8.5% 6.4% 7.1% 5.3% Interest expense 1.3% 1.6% 1.3% 1.7% Other income, net 0.4% 0.4% 0.2% 0.2% ------------------------------ Income before income taxes 7.6% 5.2% 6.0% 3.8% Income taxes 3.1% 2.1% 2.4% 1.5% ------------------------------ Net income 4.5% 3.1% 3.6% 2.3% ==============================
RESULTS OF OPERATIONS Operating Revenue - ----------------- Operating revenue for the six months ended June 30, 1999 was $556,577,000, up 16.7%, compared to $477,051,000 for the six months ended June 30, 1998. Operating revenue for the three months ended June 30, 1999 was $291,173,000, up 18.2%, compared to $246,402,000 for the three months ended June 30, 1998. The growth in operating revenue was primarily the result of increased tonnage from new and existing customers and increased revenue per hundred weight. Tonnage handled by the Company during the six and three months ended June 30, 1999, increased 10.9% and 12.2%, respectively, over the same time periods of 1998. This increase in tonnage was mainly a result of the following: - - On April 19, 1999, the Company expanded its all-points coverage to the states of New Jersey and Pennsylvania with the opening of eleven new customer centers. - - During 1997, 1998 and the first quarter of 1999, the Company's geographic expansion slowed, with an emphasis instead placed on improving the shipment density within the existing service territory. The Company revamped its freight flow and handling systems in order to reduce transit times. During the fourth quarter of 1996, the Company introduced its improved regional service with dramatically reduced transit times. During January 1999, the Company introduced its new interregional service product, which resulted in reduced transit times for most previously 3 or 4 day service points. The focus on improved service standards has allowed the Company to successfully add market penetration within its service territory resulting in additional tonnage. - - Freight volumes handled with marketing partners in Alaska, Canada, Guam, Hawaii, Mexico and Puerto Rico continued to increase at a rapid pace. On June 14, 1999, the Company expanded its service through marketing partnerships to Central America, South America and the Caribbean Islands. The initial marketing partnership commenced in 1996 with service to Canada and Mexico. Puerto Rico was added in 1997, with service to Alaska, Guam, and Hawaii added in 1998. Revenue per hundred weight for the six months ended June 30, 1999 was up 5.2% from levels experienced in the first six months of 1998. The factors which most impacted revenue per hundred weight were: - - A general rate increase of approximately 5.5% to 5.9% effective November 1, 1998. The increase applied to the Company's interstate and intrastate common carrier freight rates published in its 5000 series tariff. The Company derives approximately 50% of its revenue from the 5000 tariff. The remaining revenue is derived from contracts and guarantees, which are negotiated throughout the year. - - During the six months ended June 30, 1999, 13.3% of the total tonnage was derived from truckload shipments, an increase from 11.4% during the six months ended June 30, 1998. Rates on truckload tonnage are generally lower than less than truckload rates. Management expects that growth in operating revenue is sustainable in the near term. The major sources of growth in operating revenue in the near term should be the further penetration of existing markets, including the most recent expansion areas of Michigan, New Jersey and Pennsylvania. The Company's success in realizing future growth will be partially dependent upon the continued strength of the U.S. economy and the LTL pricing environment. Operating Expenses - ------------------ Operating expenses as a percentage of operating revenue improved to 92.9% for the six months ended June 30, 1999 from 94.7% in the six months ended June 30, 1998. Operating expenses as a percentage of operating revenue improved to 91.5% in the three months ended June 30, 1999 from 93.6% in the three months ended June 30, 1998. This overall improvement was primarily attributable to: - - Salaries, wages and benefits as a percentage of operating revenue improved to 60.7% in the six months ended June 30, 1999 from 61.4% in the six months ended June 30, 1998. This improvement resulted from ongoing educational programs and changes in operations which have led to productivity gains in the form of improved pickup and delivery density, increased line haul load factor and more direct line haul schedules. This improvement was partially offset by increased costs in the areas of workmen's compensation and health care. - - Operating supplies and expenses as a percentage of operating revenue improved to 7.6% in the six months ended June 30, 1999 from 8.4% in the six months ended June 30, 1998. This improvement was due to reduced fuel costs resulting from lower fuel prices and the increased use of purchased transportation. Although the diesel fuel prices for the first half of 1999 have been lower than those of the first half of 1998, prices at the end of June 1999 were slightly higher than those at the end of June 1998. Diesel fuel prices declined during the last half of 1998, therefore higher fuel costs relative to 1998 levels are believed likely. The costs of maintaining equipment and facilities were relatively constant. - - Operating taxes and licenses as a percentage of operating revenue improved to 3.9% in the six months ended June 30, 1999 from 4.3% in the six months ended June 30, 1998. The primary contributor to the improvement was the increased utilization of purchased transportation. - - Depreciation and amortization as a percentage of operating revenue improved to 5.4% in the six months ended June 30, 1999 from 5.8% in the six months ended June 30, 1998. This improvement was largely due to increased usage of purchased transportation and operating lease financing of revenue equipment. These improvements in operating expenses as a percentage of operating revenue were partially offset by increases in the following areas: - - Insurance as a percentage of operating revenue increased to 3.4% in the six months ended June 30, 1999 from 3.0% in the six months ended June 30, 1998. The increase was primarily a result of the Company's increased costs of accidents, particularly in the area of liability insurance. - - Rents and purchased transportation as a percentage of operating revenue increased to 6.2% in the six months ended June 30, 1999 from 5.8% in the six months ended June 30, 1998. This increase was primarily a result of increased utilization of purchased transportation and the increased usage of operating lease financing. These increases were partially offset by decreased utilization of owner operators in pick up and delivery operations beginning in the third quarter of 1998. Other - ----- Interest expense as a percentage of operating revenue decreased to 1.3% in the six months ended June 30, 1999, compared to 1.7% in the six months ended June 30, 1998. This improvement is primarily the result of lower interest rates and lower average debt balances outstanding relative to the higher revenue levels. The effective tax rate of the Company was 40.5% for the six months ended June 30, 1999 and 1998. Net income for the six months ended June 30, 1999, was $19,897,000, up 83.7%, from $10,830,000 for the six months ended June 30, 1998. Net income for the three months ended June 30, 1999, was $13,122,000, up 71.4%, from $7,658,000 for the three months ended June 30, 1998. LIQUIDITY AND CAPITAL RESOURCES Capital requirements during the six months ended June 30, 1999 consisted primarily of $47,788,000 in investing activities. The Company invested $49,418,000 in capital expenditures during the six months ended June 30, 1999 comprised of $12,399,000 in additional revenue equipment, $27,615,000 in new customer center facilities or the expansion of existing facilities and $9,404,000 in other equipment. Management expects capital expenditures for the full year of 1999 will be approximately $100,000,000, consisting primarily of anticipated investments in new and existing customer center facilities. However, the actual amount of capital expenditures required in 1999 will be dependent on: 1) the growth rate of the Company, 2) site selection and construction progress on numerous customer center projects and 3) economic benefits of operating lease financing versus ownership. At June 30, 1999 the Company had commitments for land, customer centers, revenue and other equipment of approximately $68,951,000. The Company provided for its capital resource requirements in the six months ended June 30, 1999 primarily with cash from operations. Cash from operations totaled $40,664,000 in the six months ended June 30, 1999 compared to $39,892,000 provided by operations in the six months ended June 30, 1998. Net financing activities provided an additional $10,101,000 of cash flow in the six months ended June 30, 1999. Two primary sources of credit financing were available to the Company: the revolving line of credit and the Master Shelf facility. - - The Company experiences periodic cash flow fluctuations common to the industry. Cash outflows are heaviest during the first part of any given year while cash inflows are normally weighted towards the last two quarters of the year. To smooth these fluctuations and to provide flexibility to fund future growth, the Company utilizes a variable-rate, unsecured revolving line of credit of $160,000,000 provided by Bank of America (agent), Chase Bank of Texas, N.A., Wachovia Bank, N.A., ABN-AMRO Bank N.V. and Bank One. At June 30, 1999, $89,000,000 was outstanding on the revolving line of credit, leaving $71,000,000 available for borrowing. The Company also had $15,000,000 available under its short-term, unsecured revolving $15,000,000 line of credit with Bank of America. This line of credit is also used to obtain letters of credit for its self-insurance program. At June 30, 1999 the Company had obtained letters of credit totaling $4,095,000 for this purpose. - - To assist in financing longer-lived assets, the Company has an uncommitted Master Shelf Agreement with the Prudential Insurance Company of America which provides for the issuance of up to $140,000,000 in medium to long-term unsecured notes at an interest rate calculated at issuance. At June 30, 1999, the Company had $123,250,000 outstanding under this facility. Management expects that the Company's existing working capital and its available lines of credit are sufficient to meet the Company's commitments as of June 30, 1999, and to fund current operating and capital needs. However, if additional financing is required, management believes it will be available. The Company uses off-balance sheet financing in the form of operating leases primarily in the following areas; land and structures, revenue equipment and other equipment. At June 30, 1999, future rental commitments on operating leases were $124,674,000. The Company prefers to utilize operating leases for these areas and plans to use them in the future when such financing is available and suitable. Future rental commitments on operating leases are as follows:
Land and Revenue Other (In thousands) Total Structures Equipment Equipment --------- --------- --------- --------- 1999 $ 20,302 $ 3,831 $ 8,015 $ 8,456 2000 33,489 5,577 16,030 11,882 2001 23,720 3,864 15,254 4,602 2002 20,152 3,063 15,501 1,588 2003 13,716 2,420 11,296 --- Thereafter 13,295 6,772 6,523 --- --------- --------- --------- --------- Total $ 124,674 $ 25,527 $ 72,619 $ 26,528 ========= ========= ========= =========
YEAR 2000 ISSUES The Company recognizes the Year 2000 problem and has developed a Board of Director sponsored Project Plan that identifies all date related issues relating to the Company's Information Technology (IT) applications, end user supported applications, IT infrastructure, embedded devices and business partners. At June 30, 1999, all mission critical application modifications and infrastructure upgrades were completed. Testing and production implementation had been completed at June 30, 1999. The Company's mission critical systems written in-house are already Year 2000 ready. Year 2000 ready upgrades have been installed for all purchased software. The costs incurred specifically to address Year 2000 readiness have not been and are not expected to become material to the Company because many of the systems 1) did not require significant modifications to make them Year 2000 ready, 2) were replaced for other business reasons or 3) were already year 2000 ready. The Company has initiated discussions with its significant customers and suppliers to determine the extent to which the Company would be vulnerable to those third parties' failure to remediate their own Year 2000 issues. The Company is in the process of receiving written assurances from its significant customers and suppliers that they will be Year 2000 ready, that their systems will be timely converted and that they will not have a material adverse affect on the Company. It is not possible at this time to quantify the amount of business that might be lost or the costs that could be incurred by the Company as a result of the Company's significant customers' and suppliers' failure to remediate their Year 2000 issues. The Company will establish, where needed, contingency plans based on our testing experience and responses from significant customers and suppliers. While the Company believes its efforts to address the Year 2000 issue will be successful in avoiding any material adverse effect on the Company's operations, it recognizes that failure to resolve Year 2000 issues on a timely basis could significantly limit its ability to process its daily business transactions for a period of time, especially if such failure is coupled with third party or infrastructure failures. Similarly, the Company could be significantly affected by the failure of one or more significant business partners or components of the infrastructure to conduct their respective operations after 1999. Adverse effects could include, but are not limited to, loss of communication links with customer centers, inability to process transactions or engage in similar normal business activities. The foregoing statements regarding the Company's state of readiness, costs of conversion, risks and contingency plans for Year 2000 are based on management's current estimates and evaluations using available information. There can be no assurances that management's estimates and evaluations will prove to be accurate, and actual results could differ materially from those currently anticipated. Factors which might cause material changes include, but are not limited to, the availability of Year 2000 personnel, the readiness of third parties and the Company's ability to respond to unforeseen Year 2000 complications. MARKET RISK Market risks relating to the Company's operations result primarily from changes in interest rates. The Company does not use financial instruments for trading purposes and is not a party to any derivatives. The following table provides information about the Company's financial instruments that are sensitive to changes in interest rates. The table presents the Company's debt obligations, principal cash flows, related weighted-average interest rates by expected maturity dates and fair values. INTEREST RATE SENSITIVITY PRINCIPAL AMOUNT BY EXPECTED MATURITY AVERAGE INTEREST RATE
(DOLLARS IN THOUSANDS) There- Fair Value 1999 2000 2001 2002 2003 after Total 6/30/99 - ------------------------------------------------------------------------------ Liabilities Long-Term Debt, Including Current Portion Fixed Rate $9,117 $13,029 $14,735 $12,681 $12,620 $82,650 $144,832 $147,828 Avg. Interest Rate 7.72% 7.76% 7.72% 7.75% 7.78% 8.03% Variable Rate $ - $ - $ - $ - $89,000 $ - $ 89,000 $ 89,000 Avg. Interest Rate 5.15% 5.75% 5.80% 5.83% 5.85%
ENVIRONMENTAL At June 30, 1999, the Company had no outstanding inquiries with any state or federal environmental agency. FORWARD-LOOKING STATEMENTS The Management's Discussion and Analysis Section of this report contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward- looking statements rely on a number of assumptions concerning future events, and are subject to a number of uncertainties and other factors, many of which are outside of AF's control, that could cause actual results to differ materially from such statements. These include, but are not limited to: general economic and industry conditions and demand for goods, particularly such competition on pricing, revenues, and margins; the acceptance of service offerings that offer higher margins than traditional service offerings, costs of fuel and equipment and interest costs. Item 3. Quantitative and Qualitative Disclosures About Market Risk Market Risk under Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations is incorporated herein by reference. INDEX AMERICAN FREIGHTWAYS CORPORATION AND SUBSIDIARIES PART I. FINANCIAL INFORMATION - ------------------------------ Item 1. Financial Statements (unaudited) - ------- Condensed consolidated balance sheets--June 30, 1999 and December 31, 1998 Condensed consolidated statements of income-Three months ended June 30, 1999 and 1998; Six months ended June 30, 1999 and 1998 Condensed consolidated statements of cash flows--Six months ended June 30, 1999 and 1998 Notes to condensed consolidated financial statements--June 30, 1999 Item 2. Management's Discussion and Analysis of Financial Condition and - ------- Results of Operations Item 3. Quantitative and Qualitative Disclosures about Market Risk - ------- PART II. OTHER INFORMATION - --------------------------- Item 6. Exhibits and Reports on Form 8-K - ------- (a) Exhibits: -------- (27) Financial Data Schedule (b) Reports on Form 8-K ------------------- The Company did not file any reports on Form 8-K during the three month period ended June 30, 1999. 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. AMERICAN FREIGHTWAYS CORPORATION -------------------------------- (Registrant) Date: August 4, 1999 /s/Frank Conner -------------- -------------------------------- Frank Conner Executive Vice President- Accounting & Finance and Chief Financial Officer EX-27 2 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the June 30, 1999 quarterly consolidated financial statements and is qualified in its entirety by reference to such financial statements. 1,000 6-MOS DEC-31-1999 JAN-01-1999 JUN-30-1999 6,251 0 122,497 2,385 4,796 169,558 818,756 295,049 695,394 124,562 222,060 0 0 319 278,034 695,394 0 556,577 0 516,978 0 0 7,488 33,440 13,543 19,897 0 0 0 19,897 .63 .61 Provision for Doubtful accounts included in costs and expenses applicable to revenues.
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