Nevada
|
000-24960
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88-0320154
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(State or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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400 Birmingham Hwy., Chattanooga, TN
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37419
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(Address of principal executive offices)
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(Zip Code)
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[ ]
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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|
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[ ]
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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|
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[ ]
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ]
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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|
[ ]
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Emerging growth company
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[ ]
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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Item 2.02
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Results of Operations and Financial Condition.
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|
On January 29, 2018, Covenant Transportation Group, Inc., a Nevada corporation (the "Company"), issued a press release announcing its financial and operating results for the quarter and year ended December 31, 2017. A copy of the press release is attached to this report as Exhibit 99.
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||
Item 9.01
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Financial Statements and Exhibits.
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|
(d)
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Exhibits.
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EXHIBIT
NUMBER
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EXHIBIT DESCRIPTION
|
|
Covenant Transportation Group, Inc. press release announcing financial and operating results for the quarter and year ended December 31, 2017
|
||
The information contained in Items 2.02 and 9.01 of this report and the exhibit hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
|
||
The information in Items 2.02 and 9.01 of this report and the exhibit hereto may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements are made based on the current beliefs and expectations of the Company's management and are subject to significant risks and uncertainties. Actual results or events may differ from those anticipated by forward-looking statements. Please refer to the italicized paragraph at the end of the attached press release and various disclosures by the Company in its press releases, stockholder reports, and filings with the Securities and Exchange Commission for information concerning risks, uncertainties, and other factors that may affect future results.
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COVENANT TRANSPORTATION GROUP, INC.
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||
Date: January 29, 2018
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By:
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/s/ Richard B. Cribbs
|
Richard B. Cribbs
|
||
Executive Vice President and Chief Financial Officer
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EXHIBIT
NUMBER
|
EXHIBIT DESCRIPTION
|
Covenant Transportation Group, Inc. press release announcing financial and operating results for the quarter and year ended December 31, 2017
|
·
|
Total revenue of $203.3 million, an increase of 6.5% compared with the fourth quarter of 2016.
|
·
|
Freight revenue of $181.6 million (excludes revenue from fuel surcharges), an increase of 4.7% compared with the fourth quarter of 2016.
|
·
|
Operating income of $14.8 million and an operating ratio of 91.8%, compared with operating income of $12.3 million and an operating ratio of 92.9% in the fourth quarter of 2016. Operating ratio is defined as: total operating expenses minus fuel surcharge revenue, divided by freight revenue.
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·
|
Net income of $49.3 million, or $2.68 per diluted share, compared with net income of $6.0 million, or $0.33 per diluted share in the fourth quarter of 2016.
|
·
|
In the fourth quarter of 2017, net income includes $40.1 million, or $2.18 per diluted share, of income tax benefit resulting primarily from our reasonable estimate of the revaluation of our net deferred tax balances at December 31, 2017 as a result of the recently enacted Tax Cuts and Jobs Act.
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·
|
The fourth quarter effective income tax rates were (261.8%) and 44.6% for 2017 and 2016, respectively. On a non-GAAP basis, excluding the $40.1 million reduction in income tax expense as a result of the Tax Cuts and Jobs Act, the fourth quarter of 2017 effective income tax rate was 32.7%. Primarily as a result of tax-planning strategies implemented during the fourth quarter of 2017, we were able to remove valuation allowances on certain state tax net operating losses providing for additional favorable impact to the effective income tax rate.
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Covenant Transportation Group, Inc
|
||||||||||||||||||||||||
Key Financial and Operating Statistics
|
||||||||||||||||||||||||
INCOME STATEMENT DATA
|
INCOME STATEMENT DATA
|
|||||||||||||||||||||||
Three Months Ended Dec 31,
|
Year Ended Dec 31,
|
|||||||||||||||||||||||
($000s, except per share data)
|
2017
|
2016
|
% Change
|
2017
|
2016
|
% Change
|
||||||||||||||||||
Freight revenue
|
$
|
181,597
|
$
|
173,501
|
4.7
|
%
|
$
|
626,809
|
$
|
610,845
|
2.6
|
%
|
||||||||||||
Fuel surcharge revenue
|
21,709
|
17,477
|
24.2
|
%
|
78,198
|
59,806
|
30.8
|
%
|
||||||||||||||||
Total revenue
|
$
|
203,306
|
$
|
190,978
|
6.5
|
%
|
$
|
705,007
|
$
|
670,651
|
5.1
|
%
|
||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Salaries, wages, and related expenses
|
63,145
|
62,860
|
241,784
|
234,526
|
||||||||||||||||||||
Fuel expense
|
26,829
|
27,118
|
103,139
|
103,108
|
||||||||||||||||||||
Operations and maintenance
|
11,270
|
11,637
|
48,774
|
45,864
|
||||||||||||||||||||
Revenue equipment rentals and purchased transportation
|
51,235
|
37,165
|
141,954
|
117,472
|
||||||||||||||||||||
Operating taxes and licenses
|
2,681
|
3,308
|
9,878
|
11,712
|
||||||||||||||||||||
Insurance and claims
|
8,843
|
10,611
|
33,155
|
32,596
|
||||||||||||||||||||
Communications and utilities
|
1,857
|
1,569
|
6,938
|
6,057
|
||||||||||||||||||||
General supplies and expenses
|
3,864
|
4,220
|
14,783
|
14,413
|
||||||||||||||||||||
Depreciation and amortization, including gains and losses on disposition of property and equipment
|
18,740
|
20,224
|
76,447
|
72,456
|
||||||||||||||||||||
Total operating expenses
|
188,464
|
178,712
|
676,852
|
638,204
|
||||||||||||||||||||
Operating income
|
14,842
|
12,266
|
28,155
|
32,447
|
||||||||||||||||||||
Interest expense, net
|
2,042
|
2,016
|
8,258
|
8,226
|
||||||||||||||||||||
Income from equity method investment
|
(825
|
)
|
(550
|
)
|
(3,400
|
)
|
(3,000
|
)
|
||||||||||||||||
Income before income taxes
|
13,625
|
10,800
|
23,297
|
27,221
|
||||||||||||||||||||
Income tax expense (benefit)
|
(35,673
|
)
|
4,818
|
(32,142
|
)
|
10,386
|
||||||||||||||||||
Net income
|
$
|
49,298
|
$
|
5,982
|
$
|
55,439
|
$
|
16,835
|
||||||||||||||||
Basic earnings per share
|
$
|
2.70
|
$
|
0.33
|
$
|
3.03
|
$
|
0.93
|
||||||||||||||||
Diluted earnings per share
|
$
|
2.68
|
$
|
0.33
|
$
|
3.02
|
$
|
0.92
|
||||||||||||||||
Basic weighted average shares outstanding (000s)
|
18,291
|
18,195
|
18,279
|
18,182
|
||||||||||||||||||||
Diluted weighted average shares outstanding (000s)
|
18,368
|
18,291
|
18,372
|
18,266
|
||||||||||||||||||||
Three Months Ended Dec 31,
|
Year Ended Dec 31,
|
|||||||||||||||||||||||
2017
|
2016
|
% Change
|
2017
|
2016
|
% Change
|
|||||||||||||||||||
($000s)
|
SEGMENT REVENUES
|
SEGMENT REVENUES
|
||||||||||||||||||||||
Asset-based truckload revenues
|
$
|
144,804
|
$
|
147,694
|
-2.0
|
%
|
$
|
534,636
|
$
|
541,420
|
-1.3
|
%
|
||||||||||||
Covenant Transport Solutions non-asset based revenues
|
36,793
|
25,807
|
42.6
|
%
|
92,173
|
69,425
|
32.8
|
%
|
||||||||||||||||
Freight revenue
|
$
|
181,597
|
$
|
173,501
|
4.7
|
%
|
$
|
626,809
|
$
|
610,845
|
2.6
|
%
|
||||||||||||
OPERATING STATISTICS
|
OPERATING STATISTICS
|
|||||||||||||||||||||||
Average freight revenue per loaded mile
|
$
|
2.081
|
$
|
2.027
|
2.6
|
%
|
$
|
1.890
|
$
|
1.859
|
1.7
|
%
|
||||||||||||
Average freight revenue per total mile
|
$
|
1.883
|
$
|
1.823
|
3.3
|
%
|
$
|
1.702
|
$
|
1.666
|
2.1
|
%
|
||||||||||||
Average freight revenue per tractor per week
|
$
|
4,234
|
$
|
4,280
|
-1.1
|
%
|
$
|
3,917
|
$
|
3,881
|
0.9
|
%
|
||||||||||||
Average miles per tractor per period
|
29,555
|
30,856
|
-4.2
|
%
|
120,043
|
121,782
|
-1.4
|
%
|
||||||||||||||||
Weighted avg. tractors for period
|
2,558
|
2,559
|
0.0
|
%
|
2,557
|
2,593
|
-1.4
|
%
|
||||||||||||||||
Tractors at end of period
|
2,559
|
2,535
|
0.9
|
%
|
2,559
|
2,535
|
0.9
|
%
|
||||||||||||||||
Trailers at end of period
|
7,134
|
7,389
|
-3.5
|
%
|
7,134
|
7,389
|
-3.5
|
%
|
||||||||||||||||
SELECTED BALANCE SHEET DATA
|
||||||||||||||||||||||||
($000s, except per share data)
|
12/31/2017
|
12/31/2016
|
||||||||||||||||||||||
Total assets
|
$
|
649,668
|
$
|
620,538
|
||||||||||||||||||||
Total stockholders' equity
|
$
|
295,201
|
$
|
236,414
|
||||||||||||||||||||
Total balance sheet debt, net of cash
|
$
|
198,443
|
$
|
208,075
|
||||||||||||||||||||
Net Debt to Capitalization Ratio
|
40.2
|
%
|
46.8
|
%
|
||||||||||||||||||||
Tangible book value per basic share
|
$
|
16.11
|
$
|
12.95
|