Dynamex Announces Second Quarter Results.DALLAS--(BUSINESS WIRE)--March 17, 1999--Dynamex Inc. (Nasdaq:DYMX) today announced a net loss of $2.3 million, or $0.23 per share, on revenues of $57.8 million for its second fiscal quarter ended January January: see month. 31, 1999. This compares with net income of $1.0 million, or $0.14 per share, on revenues of $48.7 million for the second quarter of fiscal 1998. For the six months ended January 31, 1999, the company reported a net loss of $1.4 million, or $0.13 per share, on revenues of $117.2 million. This compares with net income of $2.0 million, or $0.27 per share, on revenues of $95.3 million for the same period last year. Results for 1999 were negatively impacted by second quarter unusual items. Unusual items include $1,135,000 pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta ($0.07 per share after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. ) for the pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of costs associated with the previously announced termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. of the proposed acquisition of Q International Courier A monospaced typeface originating from the typewriter that is commonly used for letters. It is still considered by many to be the "appropriate" typeface for business correspondence. , Inc. and $598,000 pre-tax ($0.04 per share after-tax), primarily for severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when costs. In addition, the second quarter cost of sales includes an additional adjustment for bad debts of $427,000 pre-tax ($0.03 per share after-tax); selling, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. includes a charge of $699,000 pre-tax ($0.04 per share after-tax), primarily for professional fees and $203,000 pre-tax ($0.01 per share after-tax) of foreign currency losses related to inter-company debt transactions. Effective as of January 31, 1999, the Company amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. its bank credit agreement. Under the terms of the amended agreement, the Company may borrow Borrow To obtain or receive money on loan with the promise or understanding that it will be repaid. up to $65 million on a revolving basis through May 1, 2001. As of January 31, 1999, the outstanding balance under the credit agreement was $49.4 million. Certain covenants were amended to accommodate the unusual items in the second quarter. Interest expense includes a charge of $207,000 pre-tax ($0.01 per share after-tax) related to debt costs written off in association with the amendment of the bank credit agreement. Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a K. McClelland McClelland is the surname of:
Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. potential of the Company. Management began an in-depth in-depth adj. Detailed; thorough: an in-depth study. in-depth Adjective detailed or thorough: an in-depth analysis review of all corporate, regional, and branch costs in the second quarter with the express goal of streamlining operations and reducing costs. We have made it a corporate priority to return to our historical levels of profitability and to achieve a gross profit percentage of at least 33.0% of sales based on the current product mix and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become of at least 10.0% of sales. "We have undertaken a number of strategic initiatives to help ensure our success in this endeavor See Endevor. . A new financial executive team was put in place as of January 25th. General and administrative costs were reduced by approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $500,000 per year during the last 15 days of the second quarter. An additional $300,000 per year of administrative expense has been eliminated in the third quarter. Management also has identified over $1 million per year in administrative costs which will be phased out in the third and fourth quarters of this fiscal year. McClelland continued, "We have made significant investments in technology over the last year that will enhance our productivity and enable the Company to reduce costs further. The backbone backbone: see spinal column. The part of a network that handles the major traffic. It employs the highest-speed transmission paths in the network and may also run the longest distances. of this technology investment is our fully functional wide area network that connects our 50 operating sites in the U.S. and Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of . This internal network is enhancing our financial and operating controls and accelerating our internal and external reporting capabilities. Our branches are becoming more fully integrated and are sharing real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. corporate and marketing information through our intranet, dxNET. In addition, our online delivery system, dxNOW, is operational in five markets with company-wide rollout planned by calendar year end. "We remain committed to our goal of solidifying so·lid·i·fy v. so·lid·i·fied, so·lid·i·fy·ing, so·lid·i·fies v.tr. 1. To make solid, compact, or hard. 2. To make strong or united. v.intr. our leadership position within the same-day delivery and logistics logistics In military science, all the activities of armed-force units in support of combat units, including transport, supply, communications, and medical aid. The term, first used by Henri Jomini, Alfred Thayer Mahan, and others, was adopted by the U.S. services industry, and we anticipate a much stronger financial position for Dynamex going forward." Dynamex is a leading provider of same-day delivery and logistics services in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Canada. A copy of the Company's second quarter 10Q may be obtained at www.dynamex.com/10Q. This release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. which involve assumptions regarding Company operations and future prospects. Although the Company believes its expectations are based on reasonable assumptions, such statements are subject to risk and uncertainty, including, among other things, acquisition strategy, competition, foreign exchange, and risks associated with the local delivery industry. These and other risks are mentioned from time to time in the Company's filings with the Securities and Exchange Commission. Caution should be taken that these factors could cause the actual results to differ from those stated or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in this and other Company communications. -0-
DYNAMEX INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands except per share data)
January 31, July 31,
1999 1998
--------- ---------
(Unaudited)
ASSETS
CURRENT
Cash and cash equivalents $ 1,476 $ 1,361
Accounts receivable (net of allowance for
doubtful accounts of $1,199
and $967, respectively) 29,414 27,171
Prepaid and other current assets 7,764 5,932
Deferred income taxes 1,298 888
---------- ---------
TOTAL CURRENT ASSETS 39,952 35,352
Property and equipment - net 11,372 9,890
Intangibles - net 91,117 81,955
Deferred income taxes 206 670
Other assets 385 687
---------- ---------
TOTAL ASSETS $ 143,032 $ 128,554
---------- ---------
---------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
CURRENT
Accounts payable trade $ 6,336 $ 4,294
Accrued liabilities 12,995 12,254
Current portion of long-term debt 452 777
---------- ---------
TOTAL CURRENT LIABILITIES 19,783 17,325
Long-term debt 49,382 36,287
---------- ---------
TOTAL LIABILITIES 69,165 53,612
---------- ---------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock; $0.01 par value, 10,000 shares
authorized; none outstanding -- --
Common stock; $0.01 par value, 50,000 shares
authorized; 10,069 and 10,069 outstanding,
respectively 101 101
Receivable from stockholder (153) (204)
Additional paid-in capital 72,307 72,307
Retained earnings 2,274 3,628
Unrealized foreign currency translation
adjustment (662) (890)
---------- ---------
TOTAL STOCKHOLDERS' EQUITY 73,867 74,942
---------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 143,032 $ 128,554
---------- ---------
---------- ---------
CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three months ended Six months ended
January 31, January 31,
------------- -------------
1999 1998 1999 1998
---- ---- ---- ----
Sales $ 57,760 $ 48,712 $ 117,228 $ 95,262
Cost of sales 39,746 32,623 79,575 64,137
------ ------ ------ ------
Gross profit 18,014 16,089 37,653 31,125
Selling, general and
administrative expenses 17,067 11,773 32,306 22,887
Unusual items 1,733 -- 1,733 --
Depreciation and amortization 1,863 1,453 3,694 2,857
------ ------ ------ ------
Operating income (loss) (2,649) 2,863 (80) 5,381
Interest expense 1,232 1,071 2,175 1,899
------ ------ ------ ------
Income (loss) before taxes (3,881) 1,792 (2,255) 3,482
Income tax expense (benefit) (1,580) 753 (901) 1,475
------ ------ ------ ------
Net income (loss) $ (2,301) $ 1,039 $ (1,354) $ 2,007
------ ------ ------ ------
------ ------ ------ ------
Earnings (loss) per common
share -- basic: $ (0.23) $ 0.14 $ (0.13) $ 0.27
------ ------ ------ ------
------ ------ ------ ------
Earnings (loss) per common
share -- assuming dilution: $ (0.23) $ 0.14 $ (0.13) $ 0.27
------ ------ ------ ------
------ ------ ------ ------
Weighted average shares:
Common shares outstanding 10,069 7,412 10,069 7,387
Adjusted common shares --
assuming exercise of stock
options 10,069 7,616 10,069 7,558
DYNAMEX INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
(In thousands)
(Unaudited)
Six months ended
January 31,
-----------
1999 1998
---- ----
OPERATING ACTIVITIES
Net income (loss) $ (1,354) $ 2,007
Adjustments to reconcile net income (loss) to
net cash provided by (used in) operating
activities:
Depreciation and amortization 3,899 2,857
Deferred income taxes 54 --
Write-down of deferred banking fees 207 --
Changes in current operating assets and
liabilities:
Accounts receivable (1,670) (2,026)
Prepaids and other assets (1,804) 122
Accounts payable and accrued liabilities 2,419 (3,474)
------ -------
Net cash provided by (used in) operating
activities 1,751 (514)
------ -------
INVESTING ACTIVITIES
Payments for acquisitions (11,496) (18,963)
Purchase of property and equipment (2,851) (1,857)
------ -------
Net cash used in investing activities (14,347) (20,820)
------ -------
FINANCING ACTIVITIES
Principal payments on long-term debt (229) --
Net borrowings under line of credit 13,000 22,004
Proceeds from shareholder's note 51 --
Other assets and deferred offering costs (111) (513)
------ -------
Net cash provided by financing activities 12,711 21,491
------ -------
NET INCREASE IN CASH 115 157
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,361 1,326
------ -------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 1,476 $ 1,483
------ -------
------ -------
SUPPLEMENTAL DISCLOSURE ON NON-CASH INFORMATION
Cash paid for interest $ 1,766 $ 1,636
------ -------
------ -------
Cash paid for taxes $ 1,953 $ 3,716
------ -------
------ -------
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING
AND FINANCING ACTIVITIES
In conjunction with the acquisitions described,
liabilities were assumed as follows:
Fair value of assets acquired $ 11,577 $ 20,809
Cash paid (11,496) (18,963)
------ -------
Liabilities assumed and incurred $ 81 $ 1,846
------ -------
------ -------
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