EX-99.1 2 g88892exv99w1.txt EX-99.1 PRESS RELEASE ISSUED MAY 4, 2004 EXHIBIT 99.1 CONTACT David A. Rawden Exec. Vice President & CFO 404/687-5905 ALLIED HOLDINGS REPORTS FIRST QUARTER RESULTS DECATUR, GEORGIA, MAY 4, 2004 - ALLIED HOLDINGS, INC. (AMEX:AHI) TODAY REPORTED RESULTS FOR THE FIRST QUARTER ENDED MARCH 31, 2004. The Company reported revenues of $212.2 million in the first quarter of 2004, versus revenues of $213.6 million in the first quarter of 2003. The Company experienced a net loss of $9.0 million in the first quarter of 2004, versus a net loss of $5.7 million in the first quarter of 2003. The increase in the Company's net loss in first quarter of 2004 versus the first quarter of 2003 was caused by a decrease in the Company's Adjusted EBITDA, foreign exchange losses and the Company no longer recording tax benefits related to net losses. These items were partially offset by lower depreciation expense and gains on the sale of property during the quarter. Earnings before interest, taxes, depreciation and amortization, and gains and losses on disposal of assets (Adjusted EBITDA) for the first quarter of 2004 were $7.8 million compared to $10.6 million of Adjusted EBITDA reported during the first quarter last year. Adjusted EBITDA provides useful information to investors regarding the Company's ability to generate cash flows that can be used to service debt and provide for capital expenditures. A reconciliation of Adjusted EBITDA to net loss is provided in the financial schedules attached to this press release. The decline in Adjusted EBITDA in the first quarter of 2004 was caused in part by a 1.7% reduction in quarterly vehicle deliveries caused primarily by lower OEM shipment levels in the month of January. The Company experienced a 15.4% decline in vehicle deliveries in January 2004 versus January 2003 and a 12.3% drop in January 2004 revenues versus the prior year January period. During the quarter the Company also experienced higher risk management expenses related to costs for worker injuries, increased costs for benefit and pension contributions related to its U. S. Teamster contract, and certain operating inefficiencies caused by adverse weather conditions and unexpected OEM production variability. The Company also recorded severance costs related to ongoing efforts to eliminate non-strategic positions. In addition, Adjusted EBITDA declined in the first quarter as a result of the financial impact of the terms of the previously disclosed General Motors' contract renewal. These increased costs were partially offset by lower operating expenses including general and administrative costs, lower cargo claims expense and organic growth in both the new car and used car sectors. Hugh E. Sawyer, Allied's President and Chief Executive Officer, said, "Although revenues and vehicle deliveries were down slightly in the first quarter, our financial performance was also adversely impacted by other significant external events during the first quarter. Volumes in the month of January were unexpectedly soft and OEM production levels were sporadic and difficult to forecast with a high degree of accuracy. Inclement weather conditions also adversely affected terminal productivity. While lost time days and lost time injuries improved slightly compared to the first quarter of 2003, medical and benefit costs relating to workers' injuries increased $2.2 million in the first quarter of 2004 compared to 2003 due to inflationary trends in medical costs and an increase in the costs required to settle certain prior year claims. This combination of factors made the first quarter particularly challenging although our operations did ultimately improve as volumes increased during the quarter." Allied Holdings, Inc. April 29, 2003 During the first quarter of 2004, the Company borrowed $11.7 million under its revolving credit facility, compared to borrowings of $6.6 million in the first quarter of 2003. The increase in borrowings resulted in part from lower Adjusted EBITDA compared to the first quarter last year and increased working capital requirements, which were partially offset by lower capital spending in 2004 related to the Company's fleet remanufacturing program. Capital expenditures were $4.8 million in the first quarter of 2004 compared to $5.9 million in the first quarter last year. Mr. Sawyer added, "Although we are not satisfied with the results of our first quarter, the Company is financially stable and there are signs of progress in the underlying business. We are hopeful that external conditions will be more favorable in 2004. Our aspiration is to build upon the good work that has already been done." About Allied Holdings Allied Holdings, Inc. is the parent company of several subsidiaries engaged in providing distribution and transportation services of new and used vehicles to the automotive industry. The services of Allied's subsidiaries span the finished vehicle distribution continuum, and include car-hauling, intramodal transport, inspection, accessorization, and dealer prep. Allied, through its subsidiaries, is the leading company in North America specializing in the delivery of new and used vehicles. Statements in this press release that are not strictly historical are "forward looking" statements. Such statements include, without limitations, any statements containing the words "believe," "anticipate," "estimate," "expect," "intend," "plan," "seek," "hopeful," "potentially," and similar expressions. Investors are cautioned that such statements, including statements regarding improvement in the Company's underlying business or the impact of external events on the Company's financial performance, are subject to certain risks and uncertainties that could cause actual results to differ materially. Without limitation, these risks and uncertainties include economic recessions or extended or more severe downturns in new vehicle production or sales, increases in light truck and sport utility vehicles delivered, increases in medical and benefit costs, operating inefficiencies, OEM production variability and the highly competitive nature of the automotive distribution industry, the ability of the Company to comply with the terms of its current debt agreements, the ability of the Company to obtain financing in the future and the Company's highly leveraged financial position. Investors are urged to carefully review and consider the various disclosures made by the Company in this press release and in the Company's reports filed with the Securities and Exchange Commission. NOTE: The information in this press release will be discussed by management today on a conference call that can be accessed at the following links: www.companyboardroom.com or www.alliedholdings.com beginning at 10:30 a.m. EST. ALLIED HOLDINGS, INC. AND SUBSIDIARIES 2004 FIRST QUARTER EARNINGS RELEASE (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, ---------------------------- 2004 2003 --------- --------- Revenues $ 212,244 $ 213,592 Net income $ (9,048) $ (5,664) Earnings per share: Basic $ (1.03) $ (0.67) Diluted $ (1.03) $ (0.67) Weighted average common shares outstanding: Basic 8,789 8,409 Diluted 8,789 8,409
ALLIED HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
MARCH 31, DECEMBER 31, 2004 2003 --------- ------------ (UNAUDITED) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 8,441 $ 2,148 Restricted cash and cash equivalents 28,902 $ 26,267 Receivables, net of allowance for doubtful accounts of $2,228 and $3,575 respectively 63,570 55,110 Inventories 5,046 4,983 Deferred income taxes 19,460 20,213 Prepayments and other current assets 18,284 12,644 --------- --------- Total current assets 143,703 121,365 --------- --------- PROPERTY AND EQUIPMENT, NET 148,944 155,573 --------- --------- GOODWILL, NET 89,922 90,203 --------- --------- OTHER ASSETS: Restricted cash and cash equivalents 61,416 55,817 Other non-current assets 33,513 32,777 --------- --------- Total other assets 94,929 88,594 --------- --------- Total assets $ 477,498 $ 455,735 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Current maturities of long-term debt $ 16,374 $ 16,374 Borrowings under revolving credit facility 16,870 -- Trade accounts payable 46,478 34,272 Accrued liabilities 89,493 80,937 --------- --------- Total current liabilities 169,215 131,583 --------- --------- LONG-TERM DEBT, LESS CURRENT MATURITIES 224,959 230,126 --------- --------- POSTRETIREMENT BENEFITS OTHER THAN PENSIONS 5,232 5,302 --------- --------- DEFERRED INCOME TAXES 19,460 20,213 --------- --------- OTHER LONG-TERM LIABILITIES 58,771 59,697 --------- --------- STOCKHOLDERS' EQUITY: Preferred stock, no par value; 5,000 shares authorized, none outstanding -- -- Common stock, no par value; 20,000 shares authorized, 8,848 and 8,764 shares outstanding at March 31, 2004 and December 31, 2003, respectively -- -- Additional paid-in capital 48,009 47,511 Treasury stock at cost, 139 shares at March 31, 2004 and December 31, 2003, respectively (707) (707) Accumulated deficit (44,072) (35,024) Accumulated other comprehensive loss, net of tax (3,369) (2,966) --------- --------- Total stockholders' equity (139) 8,814 --------- --------- Total liabilities and stockholders' equity $ 477,498 $ 455,735 ========= =========
ALLIED HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, --------------------------- 2004 2003 --------- --------- REVENUES $ 212,244 $ 213,592 --------- --------- OPERATING EXPENSES: Salaries, wages and fringe benefits 119,947 117,575 Operating supplies and expenses 37,046 37,180 Purchased transportation 25,906 24,713 Insurance and claims 9,163 9,357 Operating taxes and licenses 6,559 7,838 Depreciation and amortization 10,386 12,024 Rents 1,716 1,620 Communications and utilities 1,954 1,888 Other operating expenses 2,186 2,849 (Gain) loss on disposal of operating assets, net (1,137) 264 --------- --------- Total operating expenses 213,726 215,308 --------- --------- Operating Loss (1,482) (1,716) --------- --------- OTHER INCOME (EXPENSE): Interest expense (7,368) (7,381) Investment income 57 326 Foreign exchange (loss) gain, net (155) 1,018 Other, net (100) -- --------- --------- (7,566) (6,037) --------- --------- LOSS BEFORE INCOME TAXES (9,048) (7,753) INCOME TAX BENEFIT -- 2,089 --------- --------- NET LOSS $ (9,048) $ (5,664) ========= ========= BASIC AND DILUTED LOSS PER COMMON SHARE: BASIC $ (1.03) $ (0.67) ========= ========= DILUTED $ (1.03) $ (0.67) ========= ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: BASIC 8,789 8,409 ========= ========= DILUTED 8,789 8,409 ========= =========
ALLIED HOLDINGS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS)
FOR THE THREE MONTHS ENDING MARCH 31, 2004 2003 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (9,048) $ (5,664) Adjustments to reconcile net loss to net cash (used in) provided by operating activities: Interest expense paid in kind -- 369 Amortization of deferred financing costs 704 1,012 Depreciation and amortization 10,386 12,024 (Gain)/loss on disposal of operating assets, net (1,137) 264 Foreign exchange (gains) loss, net 155 (1,018) Deferred income taxes -- (4,401) Compensation expense related to stock options and grants 195 60 Amortization of Teamsters Union contract costs -- 600 Change in operating assets and liabilities: Receivables, net of allowance for doubtful accounts (8,541) 2,810 Inventories (74) (226) Prepayments and other current assets (7,117) (2,039) Trade accounts payable 12,250 (3,810) Accrued liabilities 7,637 (2,146) -------- -------- Net cash (used in) provided by operating activities 5,410 (2,165) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (4,847) (5,878) Increase in Restricted cash and cash equivalents (8,234) (2,686) Increase in Restricted investments -- (2,442) Proceeds from sale of property and equipment 1,826 11 Decrease in the cash surrender value of life insurance -- 1 -------- -------- Net cash used in investing activities (11,255) (10,994) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Additions to revolving credit facilities, net 16,870 8,471 Repayment of long-term debt (5,167) (2,226) Payment of deferred financing costs -- (407) Proceeds from issuance of common stock 303 57 Other, net -- (12) -------- -------- Net cash provided by financing activities 12,006 5,883 -------- -------- EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 132 85 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 6,293 (7,191) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 2,148 9,448 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 8,441 $ 2,257 ======== ========
ALLIED HOLDINGS, INC. AND SUBSIDIARIES 2004 FIRST QUARTER EARNINGS RELEASE OPERATING DATA (UNAUDITED)
THREE MONTHS ENDED MARCH 31, ------------------------------------ 2004 2003 ------------- ------------- AAG, INCLUDING ALLIED HOLDINGS REVENUES $ 205,667,000 $ 206,202,000 OPERATING INCOME $ (2,138,000) $ (2,387,000) OPERATING RATIO 101.04% 101.16% VEHICLES DELIVERED 2,176,748 2,213,276 LOADS DELIVERED 283,064 289,081 VEHICLES PER LOAD 7.69 7.66 REVENUE PER VEHICLE $ 94.48 $ 93.17 PERCENT DAMAGE FREE DELIVERY 99.7% 99.7% NUMBER OF AVERAGE ACTIVE RIGS 3,692 3,803 AVERAGE EMPLOYEES DRIVERS 3,761 4,235 OTHERS 1,877 2,013 AXIS GROUP: REVENUES $ 6,577,000 $ 7,390,000 OPERATING INCOME $ 656,000 $ 671,000
ALLIED HOLDINGS, INC. AND SUBSIDIARIES 2004 FIRST QUARTER EARNINGS RELEASE NON-GAAP FINANCIAL INFORMATION (UNAUDITED)
THREE MONTHS ENDED MARCH 31, ------------------------- 2004 2003 -------- -------- RECONCILIATION OF NET (LOSS) TO ADJUSTED EBITDA: NET (LOSS) $ (9,048) $ (5,664) INCOME TAX (BENEFIT) -- (2,089) INTEREST EXPENSE 7,368 7,381 INVESTMENT INCOME (57) (326) FOREIGN EXCHANGE LOSSES (GAINS), NET 155 (1,018) OTHER, NET 100 -- LOSS ON DISPOSAL OF OPERATING ASSETS (1,137) 264 DEPRECIATION AND AMORTIZATION 10,386 12,024 -------- -------- ADJUSTED EBITDA $ 7,767 $ 10,572 ======== ========
ADJUSTED EBITDA IS PRESENTED BECAUSE MANAGEMENT BELIEVES IT PROVIDES USEFUL INFORMATION TO INVESTORS REGARDING THE COMPANY'S ABILITY TO GENERATE CASH FLOWS THAT CAN BE USED TO SERVICE DEBT AND PROVIDE FOR CAPITAL EXPENDITURES. THE COMPANY'S NET INCOME IS THE CLOSEST MEASURE IN THE COMPANY'S FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("GAAP"), IN TERMS OF COMPARABILITY TO ADJUSTED EBITDA. BECAUSE ADJUSTED EBITDA IS NOT A MEASURE DETERMINED IN ACCORDANCE WITH GAAP AND IS THUS SUSCEPTIBLE TO VARYING CALCULATIONS, ADJUSTED EBITDA AS PRESENTED MAY NOT BE COMPARABLE TO OTHER SIMILARLY TITLED MEASURES USED BY OTHER COMPANIES.