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THIRD QUARTER AND FISCAL YEAR END RESULTS NEGATIVELY IMPACTED BY TRANSITION TO 'CLOSED LOOP' STRATEGY IN MNX'S TRUCKLOAD SUBSIDIARY

 THIRD QUARTER AND FISCAL YEAR END RESULTS NEGATIVELY IMPACTED BY
 TRANSITION TO 'CLOSED LOOP' STRATEGY IN MNX'S TRUCKLOAD SUBSIDIARY
 ST. JOSEPH, Mo., Sept. 23 /PRNewswire/ -- MNX Incorporated (NASDAQ: MNXI), a nationwide transportation company, announced today that the previously announced conversion of the company's truckload subsidiary to a "closed loop" operating strategy will negatively impact both third quarter and 1992 year end results for the company.
 Roger Crouch, vice chairman of MNX, commented, "This new strategy is designed to provide a premium level of service to our largest customers while improving our overall revenue per mile. Our new focus on a limited number of customer 'closed loops' will allow us to operate with far less management overhead and at greater margins than were possible in our traditional truckload operation. It also represents a major improvement in the quality of jobs we can offer our drivers. While it has negatively impacted short-term earnings, the transition is going very well and our customer response has been excellent. We remain very optimistic about what this change will bring in the future for the earnings potential of our trucking operation, as well as the service we offer our customers.
 "The change did require the elimination of four senior management positions in our truckload operation and the promotion of new line managers with individual profit responsibility for each closed loop. We believe the toughest part of this transaction will be behind us in the fourth quarter and that the benefits have already begun to materialize."
 Mike Head, president of MNX further commented, "This transition began in June and at that time it was difficult to estimate, with precision, its impact on 1992 earnings in several areas. For example:
 1. Our recruiting costs have been high as we now focus on hiring drivers with home domiciles in closed loop proximity. We estimate that 1992 driver recruiting costs will be approximately $500,000 over normal levels.
 2. During this transition, we continued to meet some past customer commitments not located in the closed loops and to slowly build reliable backhauls where needed. These factors reduced our total revenue mile in the third quarter by approximately 1.6 million miles over the same period last year. This will negatively impact earnings by approximately $500,000 in this quarter.
 3. Our new closed loop customer miles are at a higher revenue per mile, but the empty miles and low priced backhaul incurred during this transition period caused our overall revenue per mile to drop roughly 1.8 cents per mile from the same period last year. This will negatively impact third quarter results by an additional $450,000. Long-term we believe the shorter length of haul and improved service created by this strategy will improve our traditional revenue per mile.
 4. The transition has caused us to maintain extra trailer pools and delay normal asset turnovers that have cost approximately $300,000 for 1992.
 5. The significant management and administrative changes required have resulted in overtime, severance, and other one time costs that will significantly impact 1992 earnings.
 "While all of these factors are now improving, they will continue to impact the earnings of our truckload operations in the fourth quarter. Meanwhile, the growth of our Transportation Services Group (Mark VII), our Refrigerated Trailer Operations (TemStar), and the results of the MNX Logistics Management Group (ERX), appear to be in line with our expectations for the year. While it is difficult to calculate the short-term earnings impact of these changes for the remainder of the year, we believe our year end 1992 results may be slightly below last year's consolidated results. Third quarter results are expected to be positive, but significantly below last year's 15 cents per share."
 -0- 9/23/92
 /CONTACT: Janet K. Pullen of MNX Incorporated, 816-233-3158/
 (MNXI) CO: MNX Incorporated ST: Missouri IN: TRN SU:


LR-TS -- NY006 -- 2478 09/23/92 08:35 EDT
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Publication:PR Newswire
Date:Sep 23, 1992
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