EX-99 3 earnq403.htm EXHIBIT 99 FOURTH QUARTER 2003 EARNINGS RELEASE
Contact:           Ray Harlin
          Chief Financial Officer 
          (423) 510-3323 

U.S. XPRESS ENTERPRISES REPORTS EIGHTH CONSECUTIVE QUARTER OF
EARNINGS IMPROVEMENT ON HIGHER FOURTH QUARTER
AND YEAR-END RESULTS

CHATTANOOGA, Tenn. (February 2, 2004) — U.S. Xpress Enterprises, Inc. (NASDAQ/NM: XPRSA) today reported higher operating revenues and earnings for the fourth quarter ended December 31, 2003. Revenues increased 4.4% to $239.6 million, compared with $229.4 million in the fourth quarter of 2002. For the year ended December 31, 2003, revenues increased 7.9% to $930.5 million compared with $862.3 million in 2002.

        Net income for the fourth quarter of 2003 was $2.6 million, or $0.19 per diluted share, compared with net income (before a charge of $1.7 million related to settlement of litigation matter) of $1.4 million, or $0.10 per share, in the fourth quarter of 2002. Net income for the fourth quarter of 2002 after the litigation charge was $522,000, or $0.04 per diluted share. For the year ended December 31, 2003, net income was $7.6 million, or $0.54 per diluted share, compared with net income (before the litigation charge discussed above and an extraordinary charge for the early extinguishment of debt of $1.8 million) of $3.2 million, or $0.23 per diluted share, in 2002. Net income in 2002 after the charges for the litigation settlement and the early extinguishment of debt was $1.1 million, or $0.08 per share.

        Co-Chairman, Pat Quinn, stated, “A primary focus during the past year has been on enhancing the performance of each of our operating units. For the second consecutive year, we were able to post year-over-year improvements in operating results in each quarter. Pre-tax margins of the U.S. Xpress truckload business improved in the fourth quarter on the strength of a 4.6% increase in revenue per mile, improved freight demand, and continued controls over the growth in fixed expenses. Xpress Global Systems increased revenues 13.8% in the quarter as we experienced year-over-year growth in both our floorcovering distribution and airport-to-airport operations. Operating income of Xpress Global improved to $492,000 in the fourth quarter of 2003, compared with $38,000 in 2002, driven by improved results in the airport-to-airport operations.

        “Consistent with our strategy to focus resources on truckload services that offer opportunity for greater returns, regional and dedicated fleets grew from approximately 19% of our fleet in the fourth quarter of 2002 to over 30% in the fourth quarter of 2003 with a corresponding reduction in the medium to long haul fleet. The regional and dedicated fleets tend to have lower miles per trip, a higher rate per loaded mile and lower miles per truck which has impacted the comparative operating statistics reported in the accompanying financial results. During 2004, we expect that the regional, dedicated and team fleets will grow as a percentage of our total fleet.

        “During the second half of 2003, we experienced an increasingly difficult environment for recruiting drivers and owner-operators, which adversely impacted our seated truck capacity during the fourth quarter. This, in turn, reduced the anticipated rate of growth in our truckload revenue. We have addressed this issue by aggressively focusing on our recruiting and retention efforts and by announcing a driver and owner-operator pay increase which will take effect during the first quarter of 2004. These actions have enabled us to add to our seated tractor capacity throughout January 2004.

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XPRSA Reports Fourth Quarter and Year-end Results
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February 2, 2004


        “Our industry faces a number of challenges as we enter 2004, including the new hours of service regulations, higher truck prices and operating cost of the EPA-compliant truck engines, and a difficult driver and owner-operator recruiting environment. We have taken aggressive actions to mitigate the potential negative impact of each of these challenges. Further, with the ongoing economic recovery, freight demand continues to accelerate providing substantial opportunity to improve our overall productivity and increase our rate per mile. We continue to allocate our tractor capacity to those services and customers that provide us with the opportunity to earn a satisfactory rate of return.

        “The Company’s financial position continues to strengthen. During the year we reduced our outstanding debt by $21.3 million, while generating approximately $58 million in cash flow from operations and investing approximately $23 million in capital expenditures. Stockholder equity grew by $8.8 million to $167.2 million, or $11.90 per share, and our liquidity remains strong with over $50 million in available borrowings under our long-term revolving credit agreement. We expect to continue the trend of significant year-over-year improvements in quarterly earnings performance in 2004. Our minimum goals include achieving consolidated operating revenue of over one billion dollars in 2004 and significantly improving operating margins in each of our business segments. We believe U.S. Xpress is well positioned to achieve these goals.”

Investor Conference Call and Simulcast
        U.S. Xpress Enterprises, Inc. will conduct a conference call, at 11:00 am EST on February 3, 2004, to discuss the fourth quarter and year end results. The number to call for this interactive teleconference is (719) 457-2600. A seven-day replay of the conference call will be available by dialing (719) 457-0820 and entering the passcode 769029.

        The Company will also provide an online Web simulcast and rebroadcast of its 2003 fourth quarter earnings release conference call. The live broadcast of U.S. Xpress’ quarterly conference call will be available online at the Company’s website, www.usxpress.com, as well as www.firstcallevents.com/service/ajwz397741874gf12.html on February 3, 2004, beginning at 11:00 a.m. EST. The online replay will follow shortly after the call and continue through February 17, 2004.

    U.S. Xpress Enterprises, Inc. is the fifth-largest publicly owned truckload carrier in the United States. The Company provides regional, dedicated and expedited truckload services throughout North America, with regional capabilities in the West, Midwest and Southeastern United States. The Company is one of the largest providers of expedited and time-definite services in the truckload sector. U.S. Xpress focuses on customers operating in dedicated, just-in-time or deferred airfreight market segments, while utilizing one of the largest team-operated fleets in the industry. Xpress Global Systems, Inc., a wholly owned subsidiary, is the leading provider of transportation, warehousing and distribution services to the floor coverings industry and provides airport-to-airport transportation services to the airfreight and airfreight forwarding industries through a network of 81 locations in North America. Xpress Global Systems also provides distribution-related services to a number of other industries, including retail, automotive and building materials. The Company also offers logistic services through its joint ownership of Transplace, an Internet-based global transportation logistics company.

        This press release contains certain forward-looking information that is subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Without limitation, these risks and uncertainties include economic recession or downturns in customers’ business cycles, rapid fluctuations in fuel pricing or availability, increases in interest rates, the availability of adequate sources of financing and the availability of qualified drivers. Readers are urged to carefully review and consider the various disclosures made by the Company in this press release and in the Company’s periodic reports on forms 10-K and 10-Q.

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XPRSA Reports Fourth Quarter and Year-end Results
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February 2, 2004

U.S. XPRESS ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
(Unaudited)

Three Months Ended
December 31,
 Twelve Months Ended
December 31,
2003
 2002
 2003
 2002
Operating Revenue     $ 239,586   $ 229,427   $ 930,509   $ 862,348  
Operating Expenses:  
  Salaries, wages and benefits    85,765    81,864    325,767    310,439  
  Fuel and fuel taxes    33,553    33,362    135,895    119,090  
  Vehicle rents    18,922    16,377    75,490    68,894  
  Depreciation and amortization    9,779    10,025    37,273    37,461  
  Purchased transportation    41,975    40,034    157,212    143,935  
  Operating expense and supplies    14,592    14,814    63,978    60,091  
  Insurance premiums and claims    13,190    10,549    48,614    40,459  
  Operating taxes and licenses    3,716    3,247    14,160    12,910  
  Communications and utilities    2,356    2,796    11,210    11,238  
  General and other operating    8,999    11,748    36,494    38,930  
  Early extinguishment of debt    --    --    --    1,776  
   Total operating expenses    232,847    224,816    906,093    845,223  
Income from Operations    6,739    4,611    24,416    17,125  
Interest Expense, net    2,188    3,253    9,873    13,384  
Income Before Income Taxes    4,551    1,358    14,543    3,741  
Income Tax Provision    1,904    836    6,900    2,642  
Net Income   $ 2,647   $ 522   $ 7,643   $ 1,099  
Earnings Per Share - basic   $ 0.19   $ 0.04   $ 0.55   $ 0.08  
Weighted average shares - basic    14,017    13,915    13,966    13,888  
Earnings Per Share - diluted   $ 0.19   $ 0.04   $ 0.54   $ 0.08  
Weighted average shares - diluted    14,165    14,026    14,067    14,043  

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XPRSA Reports Fourth Quarter and Year-end Results
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February 2, 2004

U.S. XPRESS ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Per Share Data)
(Unaudited)

Three Months Ended
December 31,
 Twelve Months Ended
December 31,
2003
 2002
 2003
 2002
Operating Revenue      100.0 %  100.0 %  100.0 %  100.0 %
Operating Expenses:  
  Salaries, wages and benefits    35.8    35.7    35.0    36.0  
  Fuel and fuel taxes    14.0    14.5    14.6    13.8  
  Vehicle rents    7.9    7.1    8.1    8.0  
  Depreciation and amortization    4.1    4.4    4.0    4.3  
  Purchased transportation    17.5    17.4    16.9    16.7  
  Operating expense and supplies    6.1    6.5    6.9    7.0  
  Insurance premiums and claims    5.5    4.6    5.2    4.7  
  Operating taxes and licenses    1.6    1.4    1.5    1.5  
  Communications and utilities    1.0    1.2    1.2    1.3  
  General and other operating    3.7    5.2    4.0    4.5  
  Early extinguishment of debt    0.0    0.0    0.0    0.2  
   Total operating expenses    97.2    98.0    97.4    98.0  
Income from Operations    2.8    2.0    2.6    2.0  

Interest Expense, net		    0.9    1.4    1.1    1.6  
Income Before Income Taxes    1.9    0.6    1.5    0.4  

Income Tax Provision		    0.8    0.4    0.7    0.3  
Net Income    1.1 %  0.2 %  0.8 %  0.1 %

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XPRSA Reports Fourth Quarter and Year-end Results
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February 2, 2004

U.S. XPRESS ENTERPRISES, INC.
KEY OPERATING FACTORS

Three Months Ended
December 31,		 Twelve Months Ended
December 31,
2003
 2002
 %
Change
 2003
 2002
 %
Change
OPERATING RATIO (1)      97.2 %  97.3 %  -0.1 %  97.4 %  97.6 %  -0.2 %
                           
OPERATING REVENUE:                          
  US Xpress, net of fuel surcharge   $ 204,576   $ 200,618    2.0 % $ 793,884   $ 762,322    4.1 %
  Fuel Surcharge    7,814    6,636    17.8 %  33,976    15,565    118.3 %
  Xpress Global Systems    36,142    31,762    13.8 %  137,842    114,806    20.1 %
  Inter-company    (8,946 )  (9,589 )  -6.7 %  (35,193 )  (30,345 )  16.0 %
Total Operating Revenue   $ 239,586   $ 229,427    4.4 % $ 930,509   $ 862,348    7.9 %
                           
OPERATING INCOME:                          
  US Xpress   $ 6,247   $ 6,267    -0.3 % $ 21,915   $ 20,022    9.5 %
  Xpress Global Systems    492    38    1194.7 %  2,501    573    336.5 %
  Early extinguishment of debt    --    --    --    --    (1,776 )  --  
  Litigation charge    --    (1,694 )  --    --    (1,694 )  --  
Total Operating Income   $ 6,739   $ 4,611    46.2 % $ 24,416   $ 17,125    42.6 %
                           
TRUCKLOAD STATISTICS:                          
Revenue Per Mile (2)    $ 1.329   $ 1.270    4.6 % $ 1.298   $ 1.257    3.3 %
Revenue Per Total Mile (2)    $ 1.195   $ 1.146    4.3 % $ 1.166   $ 1.131    3.1 %
Tractors (at end of period)-                          
     Company Owned    4,469    4,491    -0.5 %  4,469    4,491    -0.5 %
     Owner Operators    869    1,039    -16.4 %  869    1,039    -16.4 %
Total Tractors (at end of period)    5,338    5,530    -3.5 %  5,338    5,530    -3.5 %
                           
Average Number of Tractors                          
 in Fleet During Period    5,342    5,436    -1.7 %  5,433    5,331    1.9 %
                           
Average Revenue Miles Per                          
 Tractor Per Period    28,553    28,605    -0.2 %  111,564    112,804    -1.1 %
                           
Average Revenue Per Tractor                          
  Per Period   $ 37,953   $ 36,334    4.5 % $ 144,857   $ 141,790    2.2 %
                           
Empty Mile Percentage    10.12 %  9.75 %  3.8 %  10.18 %  9.98 %  2.0 %


December 31, 2003
 December 31, 2002
BALANCE SHEET DATA:                    
  Total Assets   $ 438,335      $ 438,539     
  Total Equity    167,239       158,432     
  Long-term Debt, including    146,579       167,863     
    Current Maturities  


  (1) Excludes litigation charge of $1.7 million related to a litigation settlement for the three months and year ended December 31, 2002, and the early extinguishment of debt for the year ended December 31, 2002.
  (2) Net of Fuel Surcharges

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