10-Q 1 e-8483.txt QUARTERLY REPORT FOR QTR. ENDED 03/31/2002 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549-1004 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 March 31, 2002 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-18605 SWIFT TRANSPORTATION CO., INC. (Exact name of registrant as specified in its charter) Nevada 86-0666860 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number) 2200 South 75th Avenue Phoenix, AZ 85043 (602) 269-9700 (Address, including zip code, and telephone number, including area code, of registrant's principal executive office) 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 the filing requirements for at least the past 90 days. YES [X] NO [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date (May 13, 2002) Common stock, $.001 par value: 86,398,336 shares PART I FINANCIAL INFORMATION PAGE NUMBER ------ Item 1. Financial Statements Condensed Consolidated Balance Sheets as of March 31, 2002 (unaudited) and December 31, 2001 3-4 Condensed Consolidated Statements of Earnings (unaudited) for the Three Month Periods Ended March 31, 2002 and 2001 5 Condensed Consolidated Statements of Cash Flows (unaudited) for the Three Month Periods Ended March 31, 2002 and 2001 6-7 Notes to Condensed Consolidated Financial Statements 8-9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10-13 Item 3. Quantitative and Qualitative Disclosures about Market Risk 13 PART II OTHER INFORMATION Items 1, 2, 3, 4 and 5. Not applicable Item 6. Exhibits and Reports on Form 8-K 14 2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE DATA) MARCH 31, DECEMBER 31, 2002 2001 ---------- ---------- (UNAUDITED) ASSETS Current assets: Cash $ 5,261 $ 14,151 Accounts receivable, net 276,735 248,725 Equipment sales receivable 14,552 2,107 Inventories and supplies 12,364 11,682 Prepaid taxes, licenses and insurance 31,494 26,881 Deferred income taxes 13,932 13,932 ---------- ---------- Total current assets 354,338 317,478 ---------- ---------- Property and equipment, at cost: Revenue and service equipment 1,388,682 1,401,646 Land 42,808 42,852 Facilities and improvements 207,197 197,681 Furniture and office equipment 66,958 66,319 ---------- ---------- Total property and equipment 1,705,645 1,708,498 Less accumulated depreciation and amortization 506,557 501,853 ---------- ---------- Net property and equipment 1,199,088 1,206,645 ---------- ---------- Investment in Transplace 6,324 7,517 Notes receivable from Trans-Mex 5,695 3,475 Other assets 15,654 12,081 Goodwill 8,900 8,900 ---------- ---------- $1,589,999 $1,556,096 ========== ========== See accompanying notes to condensed consolidated financial statements. CONTINUED 3 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE DATA) MARCH 31, DECEMBER 31, 2002 2001 ---------- ---------- (UNAUDITED) LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 54,343 $ 57,229 Accrued liabilities 68,947 58,925 Current portion of claims accruals 45,370 48,416 Current portion of long-term debt 3,468 3,546 Current portion of obligations under capital leases 69,837 57,661 Borrowings under line of credit 136,500 Securitization of accounts receivable 118,000 116,000 ---------- ---------- Total current liabilities 496,465 341,777 ---------- ---------- Borrowings under line of credit 117,000 Long-term debt, less current portion 9,730 16,340 Obligations under capital leases 65,616 90,146 Claims accruals, less current portion 63,775 55,975 Deferred income taxes 201,520 195,605 Fair value of interest rate swaps 2,693 4,050 Stockholders' equity: Preferred stock, par value $.001 per share Authorized 1,000,000 shares; none issued Common stock, par value $.001 per share Authorized 150,000,000 shares; 89,539,567 and 89,049,519 shares issued at March 31, 2002 and December 31, 2001, respectively 89 89 Additional paid-in capital 254,744 249,410 Retained earnings 533,302 523,892 ---------- ---------- 788,135 773,391 Less: Treasury stock, at cost (3,157,850 shares) 37,935 37,935 Other equity items 253 ---------- ---------- Total stockholders' equity 750,200 735,203 ---------- ---------- Commitments and contingencies $1,589,999 $1,556,096 ========== ========== See accompanying notes to condensed consolidated financial statements. 4 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) (IN THOUSANDS, EXCEPT SHARE DATA) THREE MONTHS ENDED MARCH 31, ---------------------------- 2002 2001 --------- --------- Operating revenue $ 475,780 $ 509,594 Operating expenses: Salaries, wages and employee benefits 180,905 192,724 Operating supplies and expenses 41,652 44,384 Fuel 54,316 71,030 Purchased transportation 83,738 91,782 Rental expense 22,194 23,862 Insurance and claims 19,380 17,193 Depreciation and amortization 36,717 35,006 Communication and utilities 7,171 6,890 Operating taxes and licenses 11,955 13,046 --------- --------- Total operating expenses 458,028 495,917 --------- --------- Operating income 17,752 13,677 Other (income) expenses: Interest expense 2,307 12,996 Interest income (287) (290) Other 407 509 --------- --------- Other (income) expenses, net 2,427 13,215 --------- --------- Earnings before income taxes 15,325 462 Income taxes 5,915 203 --------- --------- Net earnings $ 9,410 $ 259 ========= ========= Basic earnings per share $ .11 $ .00 ========= ========= Diluted earnings per share $ .11 $ .00 ========= ========= See accompanying notes to condensed consolidated financial statements. 5 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (IN THOUSANDS)
THREE MONTHS ENDED MARCH 31, ---------------------------- 2002 2001 -------- -------- Cash flows from operating activities: Net earnings $ 9,410 $ 259 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 36,646 35,159 Deferred income taxes 5,915 851 Provision for losses on accounts receivable 2,629 300 Amortization of deferred compensation 209 141 Fair market value of interest rate swaps (1,357) 3,040 Increase (decrease) in cash resulting from changes in: Accounts receivable (30,019) (5,165) Inventories and supplies (682) (21) Prepaid expenses (4,613) 160 Other assets 7,891 3,665 Accounts payable, accrued liabilities and claims accruals 9,605 5,458 -------- -------- Net cash provided by operating activities 35,634 43,847 -------- -------- Cash flows from investing activities: Proceeds from sale of property and equipment 22,074 12,778 Capital expenditures (65,683) (40,392) Repayment of note receivable 1,000 3,200 Notes receivable (11,604) Payments received on equipment sale receivables 2,107 5,799 -------- -------- Net cash used in investing activities (52,106) (18,615) -------- --------
See accompanying notes to condensed consolidated financial statements. CONTINUED 6 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (IN THOUSANDS)
THREE MONTHS ENDED MARCH 31, ---------------------------- 2002 2001 -------- -------- Cash flows from financing activities: Repayments of long-term debt (19,043) (9,463) Borrowings under line of credit 75,500 Repayments of borrowings under line of credit (56,000) (18,545) Change in borrowings under accounts receivable securitization 2,000 (12,000) Proceeds from issuance of common stock under stock option and stock purchase plans 5,125 1,473 -------- -------- Net cash provided by (used in) financing activities 7,582 (38,535) -------- -------- Net decrease in cash (8,890) (13,303) Cash at beginning of period 14,151 19,638 -------- -------- Cash at end of period $ 5,261 $ 6,335 ======== ======== Supplemental disclosure of cash flow information: Cash paid during the period for: Interest $ 3,919 $ 5,358 Income taxes $ 3,099 Supplemental schedule of noncash investing and financing activities: Equipment sales receivables $ 14,552 $ 2,749 Note receivable from property sale $ 1,715 Direct financing for purchase of equipment $ 2,421
See accompanying notes to condensed consolidated financial statements. 7 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1. Basis of Presentation The condensed consolidated financial statements include the accounts of Swift Transportation Co., Inc., a Nevada holding company, and its wholly-owned subsidiaries (the Company). All significant intercompany balances and transactions have been eliminated. These consolidated financial statements include the accounts of M.S. Carriers, Inc. ("M.S. Carriers"), which merged with a subsidiary of the Company on June 29, 2001 (the "Merger"). Upon completion of the Merger, M.S. Carriers became a wholly owned subsidiary of the Company. The Merger was accounted for as a pooling of interests. Accordingly, the historical financial statements presented herein have been restated to include the financial position, results of operations, and cash flows of M.S. Carriers. The financial statements have been prepared in accordance with generally accepted accounting principles, pursuant to rules and regulations of the Securities and Exchange Commission. In the opinion of management, the accompanying financial statements include all adjustments which are necessary for a fair presentation of the results for the interim periods presented. Certain information and footnote disclosures have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2001. Results of operations in interim periods are not necessarily indicative of results to be expected for a full year. Note 2. Contingencies The Company is involved in certain claims and pending litigation arising from the normal course of business. Based on the knowledge of the facts and, in certain cases, opinions of outside counsel, management believes the resolution of claims and pending litigation will not have a material adverse effect on the financial condition of the Company. Note 3. Receivable - Trans-Mex The Company has advanced $5.7 million to Trans-mex, Inc. S.A. de C. V., a Mexican corporation of which the Company owns 49%. These loans, which are secured by equipment, bear interest at prime plus 2% with monthly payments of interest plus amortization of the principal over five years. 8 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 4. Earnings Per Share The computation of basic and diluted earnings per share is as follows:
THREE MONTHS ENDED MARCH 31, ---------------------------- 2002 2001 ------- ------- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Net earnings $ 9,410 $ 259 ======= ======= Weighted average shares: Common shares outstanding for basic earnings per share 86,108 82,335 Equivalent shares issuable upon exercise of stock options 1,860 2,217 ------- ------- Diluted shares 87,968 84,552 ======= ======= Basic earnings per share $ .11 $ .00 ======= ======= Diluted earnings per share $ .11 $ .00 ======= =======
Note 5. Accounting Standards Adopted by the Company The Company adopted Statement of Financial Standards No. 142 "Goodwill and Other Intangible Assets" on January 1, 2002. This standard eliminates amortization of goodwill and replaces it with a test for impairment. The Company has $8.9 million of goodwill. The Company amortized $359,000 of goodwill for the three months ended March 31, 2001. 9 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FORWARD-LOOKING STATEMENTS This Report on Form 10-Q contains forward-looking statements. The words "believe," "expect," "anticipate," and "project," and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements may include, but are not limited to, projections of revenues, income, or loss, capital expenditures, plans for future operations, financing needs or plans, the impact of inflation and plans relating to the foregoing. Statements in Exhibit 99 to this Quarterly Report on Form 10-Q and in the Company's Annual Report on Form 10-K, including Notes to the Consolidated Financial Statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations," describe factors, among others, that could cause actual results or events to differ materially from those expressed in forward-looking statements. Additional factors that could contribute to or cause such differences are set forth in "Business" and "Market for the Registrant's Common Stock and Related Stockholder Matters" in the Company's Annual Report on Form 10-K. POOLING OF INTERESTS On June 29, 2001, the Company acquired M.S. Carriers, Inc. ("M.S. Carriers") through the merger of a wholly owned subsidiary of the Company with and into M.S. Carriers (the "Merger"). Upon completion of the Merger, M.S. Carriers became a wholly owned subsidiary of the Company. The Merger has been accounted for as a pooling of interests. Accordingly, all historical financial data discussed below has been restated to include the financial position, results of operations, and cash flows of M.S. Carriers. OVERVIEW See Note 5 to the financial statements for discussion of accounting standards adopted by the Company. Although the trend in the truckload segment of the motor carrier industry over the past several years has been towards consolidation, the truckload industry remains highly fragmented. Management believes the industry trend towards financially stable "core carriers" will continue and result in continued industry consolidation. The Company expanded its fleet with an increase of 95 tractors to 15,486 tractors as of March 31, 2002 up from 15,391 tractors as of March 31, 2001. The owner operator portion of the Company's fleet decreased to 3,204 as of March 31, 2002 from 3,463 as of March 31, 2001. RESULTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2002 COMPARED TO THREE MONTHS ENDED MARCH 31, 2001 Operating revenue decreased $33.8 million or 6.6% to $475.8 million for the three months ended March 31, 2002 from $509.6 million for the corresponding period of 2001. The first quarter of 2002 includes $2.7 million of fuel surcharge revenue versus $18.5 million in 2001. Excluding this fuel surcharge revenue, the decrease in revenues would have been 3.7%. The decrease in operating revenue, net of the impact of surcharge revenue, primarily resulted from the reduced number of trucks operated by the Company during the first quarter of 2002 as compared to the same period in 2001. The Company began the 10 first quarter of 2002 with approximately 650 trucks without drivers. The number of unmanned trucks has since been reduced to approximately 300. In addition, the Company operated during the first quarter of 2002 with more than 300 fewer owner operators than the first quarter of 2001. The Company's operating ratio (operating expenses expressed as a percentage of operating revenue) for the first quarter of 2002 was 96.3% compared to 97.3% in the comparable period of 2001. The Company's operating ratio for the three months ended March 31, 2002 decreased as a result of decreases in certain components of operating expenses as a percentage of operating revenue as discussed below. The Company's empty mile factor for linehaul operations was 14.95% and 15.72% and average loaded linehaul revenue per mile (excluding fuel surcharge) was $1.4171 and $1.4178 in the first quarter of 2002 and 2001, respectively. Salaries, wages and employee benefits represented 38.0% of operating revenue for the three months ended March 31, 2002 compared with 37.8% in 2001. Although the majority of our salaries, wages and employee benefits are variable, the fixed portion will cause an increase in this percentage when operating revenue decreases. From time to time the industry has experienced shortages of qualified drivers. If such a shortage were to occur over a prolonged period and increases in driver pay rates were needed in order to attract and retain drivers, the Company's results of operations would be negatively affected to the extent that corresponding freight rate increases were not obtained. Fuel as a percentage of operating revenue was 11.4% for the first quarter of 2002 versus 13.9% in 2001. The decrease is primarily due to actual fuel cost per gallon decreasing by approximately 28 cents per gallon (21%) in the first quarter of 2002 versus the first quarter of 2001. Increases in fuel costs, to the extent not offset by rate increases or fuel surcharges, would have an adverse effect on the operations and profitability of the Company. Management believes the most effective protection against fuel cost increases is to maintain a fuel efficient fleet and to implement fuel surcharges when such option is necessary and available. The Company currently does not use derivative-type hedging products. Purchased transportation as a percentage of operating revenue was 17.6% for the three months ended March 31, 2002 compared to 18.0% in 2001. The decrease is primarily due to a reduction in the owner operator portion of the fleet. Rental expense as a percentage of operating revenue was 4.7% for the first quarter of 2002 and 2001. At March 31, 2002 and 2001, leased tractors represented 44% and 48%, respectively, of the fleet of Company tractors. When it is economically advantageous to do so, the Company will purchase then sell tractors that it currently leases by exercising the purchase option contained in the lease. Gains on these activities are recorded as a reduction of rent expense. The Company recorded gains of $403,000 in the first quarter of 2002 and $19,000 during the first quarter of 2001 from the sale of leased tractors. Depreciation and amortization expense as a percentage of operating revenue was 7.7% in the first quarter of 2002 versus 6.9% in the first quarter of 2001. The Company includes gains and losses from the sale of owned revenue equipment in depreciation and amortization expense. During the three month period ended March 31, 2002, net gains from the sale of revenue equipment reduced depreciation and amortization expense by approximately $1.4 million compared to approximately $1.1 million in the first quarter of 2001. Exclusive of gains, which reduced this expense, depreciation and amortization expense, as a percentage of operating revenue was 8.0% and 7.1% in the first quarter of 2002 and 2001, respectively. This increase is primarily due to a greater percentage of the Company tractors in 2002 being owned versus leased. 11 Insurance and claims expense represented 4.1% and 3.4% of operating revenue in the first quarter of 2002 and 2001, respectively. Included in the first quarter of 2002 are $4.0 million of increased insurance premiums over the same quarter of the prior year, approximately .8% of operating revenue. The Company expects this percentage will range between 4% and 5% this year. The Company's insurance program for liability, physical damage and cargo damage involves self-insurance with varying risk retention levels. Claims in excess of these risk retention levels are covered by insurance in amounts which management considers adequate. The Company accrues the estimated cost of the uninsured portion of pending claims. These accruals are estimated based on management's evaluation of the nature and severity of individual claims and an estimate of future claims development based on historical claims development trends. Insurance and claims expense will vary as a percentage of operating revenue from period to period based on the frequency and severity of claims incurred in a given period as well as changes in claims development trends. Interest expense decreased to $2.3 million in 2002 from $13.0 million in 2001. This decrease was due to lower interest rates, a shift in borrowings from more costly M.S. Carriers debt to less costly Swift debt, and decreased borrowings under long term debt and capital lease obligations. In addition, the first quarter of 2002 includes the benefit of a $1.3 million reduction in market value of interest rate derivative agreements of M.S. Carriers while the first quarter of 2001 includes a $3.0 million expense for the increase in the market value of the interest rate derivative agreements. LIQUIDITY AND CAPITAL RESOURCES The continued growth in the Company's business requires significant investment in new revenue equipment, upgraded and expanded facilities, and enhanced computer hardware and software. The funding for this expansion has been from cash provided by operating activities, proceeds from the sale of revenue equipment, long-term debt, borrowings on the Company's line of credit, proceeds from the accounts receivable securitization, the use of operating leases to finance the acquisition of revenue equipment and from periodic public offerings of common stock. Net cash provided by operating activities was $35.6 million in the first three months of 2002 compared to $43.8 million in 2001. The decrease is primarily attributable to a larger increase in accounts receivable offset by an increase in net earnings, an increase in deferred taxes, a positive change in the fair market value of the interest rate swaps, and an increase in accounts payable, accrued liabilities and claims accruals. Net cash used in investing activities increased to $52.1 million in the first three months of 2002 from $18.6 million in 2001. The increase is primarily due to increased capital expenditures and an increase in notes receivable offset by increased proceeds from the sale of property and equipment. As of March 31, 2002, the Company had commitments outstanding to acquire replacement and additional revenue equipment for approximately $390 million. The Company has the option to cancel such commitments upon 60 days notice. The Company believes it has the ability to obtain debt and lease financing and generate sufficient cash flows from operating activities to support these acquisitions of revenue equipment. During the first three months of 2002, the Company incurred approximately $10.5 million of non-revenue equipment capital expenditures. These expenditures were primarily for facilities and equipment. The Company anticipates that it will expend approximately $46 million during the remainder of the year for various facilities upgrades and acquisition and development of terminal facilities. Factors such as costs and opportunities for future terminal expansions may change the amount of such expenditures. 12 The funding for capital expenditures has been and is anticipated to continue to be from a combination of cash provided by operating activities, amounts available under the Company's line of credit, accounts receivable securitization and debt and lease financing. The availability of capital for revenue equipment and other capital expenditures will be affected by prevailing market conditions and the Company's financial condition and results of operations. Net cash provided by financing activities amounted to $7.6 million in the first three months of 2002 compared to $38.5 million used in financing activities in 2001. This increase is primarily due to increased borrowings under the line of credit and increased proceeds under the accounts receivable securitization, offset by increased repayments of long-term debt. Management believes it will be able to finance its needs for working capital, facilities improvements and expansion, as well as anticipated fleet growth, with cash flows from future operations, borrowings available under the line of credit, accounts receivable securitization and with long-term debt and operating lease financing believed to be available to finance revenue equipment purchases. Over the long term, the Company will continue to have significant capital requirements, which may require the Company to seek additional borrowings or equity capital. The availability of debt financing or equity capital will depend upon the Company's financial condition and results of operations as well as prevailing market conditions, the market price of the Company's common stock and other factors over which the Company has little or no control. INFLATION Inflation can be expected to have an impact on the Company's operating costs. A prolonged period of inflation would cause interest rates, fuel, wages and other costs to increase and would adversely affect the Company's results of operations unless freight rates could be increased correspondingly. However, the effect of inflation has been minimal over the past three years. SEASONALITY In the transportation industry, results of operations generally show a seasonal pattern as customers reduce shipments after the winter holiday season. The Company's operating expenses also tend to be higher in the winter months primarily due to colder weather, which causes higher fuel consumption from increased idle time. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company has interest rate exposure arising from the Company's line of credit, approximately $79 million of capital lease obligations and accounts receivable securitization, all of which have variable interest rates. These variable interest rates are impacted by changes in short-term interest rates. The Company manages interest rate exposure through its mix of variable rate debt, fixed rate lease financing and $70 million notional amount of interest rate swaps. The fair value of the Company's long-term debt approximates carrying values. Assuming the current level of borrowings, a hypothetical one-percentage point increase in interest rates would increase the Company's interest expense by $2.6 million. 13 SWIFT TRANSPORTATION CO., INC. & SUBSIDIARIES PART II. OTHER INFORMATION ITEMS 1, 2, 3, 4 AND 5. Not applicable ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibit 3.1 - Amended and Restated Articles of Incorporation of the Registrant (Incorporated by reference to Exhibit 4.1 of the Registrant's Registration Statement No. 333-85940 on Form S-8) Exhibit 3.2 - Bylaws of the Registrant (Incorporated by reference to Exhibit 3.2 of the Registrant's Registration Statement No. 33-66034 on Form S-3) Exhibit 10.18 - Swift Transportation Corporation Deferred Compensation Plan Exhibit 99 - Private Securities Litigation Reform Act of 1995 Safe Harbor Compliance Statement for Forward-Looking Statements (b) No Current Reports on Form 8-K were filed during the three months ended March 31, 2002. SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. SWIFT TRANSPORTATION CO., INC. Date: May 14, 2002 /s/ William F. Riley III ---------------------------------------- (Signature) William F. Riley III Senior Executive Vice President and Chief Financial Officer 14