Express-1 Expediting Solutions Executes Strategy

Express-1 Expedited Solutions, Inc. today reported its earnings for the second quarter, ended June 30, 2009.

During the second quarter of 2009, Express-1 Expedited Solutions, Inc. reported a net income of $288,000 compared to $774,000 for the same quarter in 2008. The Company's performance was impacted by a soft economy that resulted in a 25% reduction in total revenue as compared to the same quarter in 2008. The net income generated in the quarter was primarily attributable to operating cost reductions put in place during the first quarter. Michael R. Welch, the Company's CEO, shared these thoughts, "We are cautiously optimistic that both revenue and net income will increase for the remainder of the year as we are beginning to see increased freight volumes."

Selling, General, and Administrative costs decreased by $383,000 in the second quarter of 2009 compared to the same quarter in 2008. The second quarter represented the first period in which the full impact of these cuts was recognized and reduced the Company's overall SG&A expense from 16% of gross revenues in the first quarter of 2009 to 13.5% of gross revenues in the second quarter of 2009. "We anticipate this percentage being further reduced as the economy improves and we gain additional efficiencies. Our ability to manage our SG&A costs will continue to be a critical component of our financial strategy in 2009," stated Welch.

Express-1 Expedited Solutions, Inc. continues to maintain a strong balance sheet by successfully administering its accounts receivables. "Our support team has done a tremendous job of managing our accounts receivables; we have not realized any major write-offs during the first 6 months of 2009," said Welch. The Company's concentration of risk also remains healthy as it doesn't have any one customer that represents over 5% of its outstanding receivables. Additionally, the combined receivables of the Big Three automotive manufacturers represent only 4% of the Company's outstanding accounts receivables as of June 30, 2009.

Overall, cash flow remains healthy as the Company has additional available capacity of $4.7 million on its line of credit and no immediate capital expenditure plans. The Company remains in compliance with all of its debt covenants as of June 30, 2009.

Conference Call/Webcast Information

Management will conduct a conference call Tuesday, August 11, 2009, at 10:00 a.m. Eastern to discuss the Company's second quarter financial results. Those interested in accessing a live or archived Webcast of the call should visit the Company's Website at www.express-1.com. Those wishing to take part in the live teleconference call can dial 877-407-0782, with international participants dialing 201-689-8567. A playback will be available until midnight on August 18, 2009. To listen to the playback, please call 877-660-6853 or 201-612-7415 for international callers. Use account number 286 and conference ID number 329293. Additionally, the webcast will be available for 12 months on the corporate website under the Vcall caption.

Forward-Looking Statements

This press release contains forward-looking statements that may be subject to various risks and uncertainties. Such forward-looking statements are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and are made based on management's current expectations or beliefs, as well as assumptions made by and information currently available to management. These forward-looking statements, which may include statements regarding our future financial performance or results of operations, including expected revenue growth, cash flow growth, future expenses, future operating margins and other future or expected performance are subject to risks. These risks include: the acquisition of businesses or the launch of new lines of business, which could increase operating expenses and dilute operating margins; increased competition, which could lead to negative pressure on our pricing and the need for increased marketing; the inability to maintain, establish or renew relationships with customers, whether due to competition or other factors; the inability to comply with regulatory requirements governing our business operations; and to the general risks associated with our businesses.

In addition to the risks and uncertainties discussed above, you can find additional information concerning risks and uncertainties that would cause actual results to differ materially from those projected or suggested in the forward-looking statements in the reports that we have filed with the Securities and Exchange Commission. The forward-looking statements contained in this press release represent our judgment as of the date of this release and you should not unduly rely on such statements. Unless otherwise required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise after the date of this press release. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in the filing may not occur, and actual results could differ materially from those anticipated or implied in the forward-looking statements.

Express-1 Expedited Solutions
Consolidated Balance Sheet
 

 

   
 

(Unaudited)
June 30, 2009

  December 31, 2008
ASSETS      
Current assets:      
Cash $ 1,526,000     $ 1,107,000  
Accounts receivable, net of allowances of $195,000 and $133,000, respectively 12,340,000     12,202,000  
Prepaid expenses 224,000     372,000  
Deferred tax asset, current 518,000     493,000  
Other current assets 472,000     650,000  
Total current assets 15,080,000     14,824,000  
       
Property and equipment, net of $2,369,000 and $2,220,000 in accumulated depreciation, respectively 2,931,000     3,141,000  
Goodwill 15,602,000     14,915,000  
Identifiable intangible assets, net of $1,906,000 and $1,682,000 in accumulated amortization, respectively 7,617,000     7,631,000  
Loans and advances 45,000     63,000  
Other long term assets 1,178,000     1,108,000  
Total long term assets 27,373,000     26,858,000  
Total assets $ 42,453,000     $ 41,682,000  
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
Current liabilities:      
Accounts payable $ 5,483,000     $ 6,578,000  
Accrued salaries and wages 296,000     691,000  
Accrued expenses, other 1,753,000     862,000  
Line of credit 4,715,000     -  
Current maturities of long-term debt 1,215,000     1,235,000  
Other current liabilities 415,000     1,030,000  
Total current liabilities 13,877,000     10,396,000  
       
       
Line of credit -     2,320,000  
Notes payable and capital leases, net of current maturities 820,000     1,400,000  
Deferred tax liability, long-term 443,000     583,000  
Other long-term liabilities 401,000     456,000  
Total long-term liabilities 1,664,000     4,759,000  
       
Stockholders' equity:      
Preferred stock, $.001 par value; 10,000,000 shares; no shares issued or outstanding -     -  
Common stock, $.001 par value; 100,000,000 shares authorized; 32,215,218 and 32,215,218 shares issued; and 32,035,218      
and 32,035,218 shares outstanding, respectively 32,000     32,000  
Additional paid-in capital 26,408,000     26,316,000  
Treasury stock, at cost, 180,000 shares held (107,000 )   (107,000 )
Accumulated earnings 579,000     286,000  
Total stockholders' equity 26,912,000     26,527,000  
  $ 42,453,000     $ 41,682,000  

 

               
Express-1 Expedited Solutions
Consolidated Statements of Operation
               
  Three Months Ended   Six Months Ended
  June 30, 2009   June 30, 2008   June 30, 2009   June 30, 2008
Revenues              
Operating revenue $ 22,243,000     $ 29,675,000   $ 42,315,000   $ 53,391,000
Expenses              
Direct expense 18,606,000     24,925,000   35,462,000   44,531,000
Gross margin 3,637,000     4,750,000   6,853,000   8,860,000
Sales general and administrative expense 3,006,000     3,389,000   6,249,000   6,539,000
Operating income from continuing operations 631,000     1,361,000   604,000   2,321,000
Other expense 19,000     12,000   9,000   15,000
Interest expense 26,000     99,000   48,000   179,000
Income from continuing operations before income tax 586,000     1,250,000   547,000   2,127,000
Income tax provision 273,000     509,000   259,000   856,000
Income from continuing operations 313,000     741,000   288,000   1,271,000
Income (loss) from discontinued operations, net of tax (25,000 )   33,000   5,000   146,000
Net income $ 288,000     $ 774,000   $ 293,000   $ 1,417,000
               
               
               
Basic income per share              
Income from continuing operations $ 0.01     $ 0.02   $ 0.01   $ 0.05
Income from discontinued operations -     -   -   -
Net income 0.01     0.02   0.01   0.05
Diluted income per share              
Income from continuing operations 0.01     0.02   0.01   0.05
Income from discontinued operations -     -   -   -
Net income $ 0.01     $ 0.02   $ 0.01   $ 0.05
Weighted average common shares outstanding              
Basic weighted average common shares outstanding 32,035,218     31,723,787   32,035,218   30,883,946
Diluted weighted average common shares outstanding 32,147,648     32,067,972   32,139,842   31,225,376

 

   
Express-1 Expedited Solutions, Inc.
Summary Financial Table
For the Three Months Ended June 30,
(Unaudited)
                    Percent of
    Quarter to Date   Quarter to Quarter Change   Business Unit Revenue
    2009   2008   In Dollars   In Percentage   2009   2008
Revenues                        
Express-1   $ 10,090,000     $ 14,609,000     $ (4,519,000 )   -30.9 %   45.4 %   49.2 %

Concert Group Logistics

10,155,000     14,492,000     (4,337,000 )   -29.9 %   45.7 %   48.8 %

Bounce Logistics

2,232,000     1,045,000     1,187,000     113.6 %   10.0 %   3.5 %
Intercompany eliminations (234,000 )   (471,000 )   237,000     50.3 %   -1.1 %   -1.5 %
Total revenues 22,243,000     29,675,000     (7,432,000 )   -25.0 %   100.0 %   100.0 %
                         
Direct expenses                      
Express-1   7,793,000     11,250,000     (3,457,000 )   -30.7 %   77.2 %   77.0 %

Concert Group Logistics

9,174,000     13,232,000     (4,058,000 )   -30.7 %   90.3 %   91.3 %

Bounce Logistics

1,873,000     914,000     959,000     104.9 %   83.9 %   87.5 %
Intercompany eliminations (234,000 )   (471,000 )   237,000     50.3 %   100.0 %   100.0 %
Total direct expenses 18,606,000     24,925,000     (6,319,000 )   -25.4 %   83.6 %   84.0 %
                         
Gross margin                      
Express-1   2,297,000     3,359,000     (1,062,000 )   -31.6 %   22.8 %   23.0 %

Concert Group Logistics

981,000     1,260,000     (279,000 )   -22.1 %   9.7 %   8.7 %
Bounce Logistics 359,000     131,000     228,000     174.0 %   16.1 %   12.5 %
Total gross margin 3,637,000     4,750,000     (1,113,000 )   -23.4 %   16.4 %   16.0 %
                         
Selling, general & administrative                      
Express-1   1,600,000     1,918,000     (318,000 )   -16.6 %   15.9 %   13.1 %

Concert Group Logistics

630,000     866,000     (236,000 )   -27.3 %   6.2 %   6.0 %
Bounce Logistics 273,000     198,000     75,000     37.9 %   12.2 %   18.9 %
Corporate   503,000     407,000     96,000     23.6 %   2.3 %   1.4 %
Total selling, general & administrative 3,006,000     3,389,000     (383,000 )   -11.3 %   13.5 %   11.4 %
                         
Operating income from continuing operations                    
Express-1   697,000     1,441,000     (744,000 )   -51.6 %   6.9 %   9.9 %

Concert Group Logistics

351,000     394,000     (43,000 )   -10.9 %   3.5 %   2.7 %
Bounce Logistics 86,000     (67,000 )   153,000     228.4 %   3.9 %   -6.4 %
Corporate   (503,000 )   (407,000 )   (96,000 )   -23.6 %   -2.3 %   -1.4 %
Operating income from continuing operations 631,000     1,361,000     (730,000 )   -53.6 %   2.8 %   4.6 %
                         
Interest expense 26,000     99,000     (73,000 )   -73.7 %   0.1 %   0.3 %
Other expense 19,000     12,000     7,000     58.3 %   0.1 %   0.0 %
Income from continuing operations before tax 586,000     1,250,000     (664,000 )   -53.1 %   2.6 %   4.2 %
                         
Tax provision 273,000     509,000     (236,000 )   -46.4 %   1.2 %   1.7 %
Income from continuing operations 313,000     741,000     (428,000 )   -57.8 %   1.4 %   2.5 %
                         
Income (loss) from discontinued operations, net of tax (25,000 )   33,000     (58,000 )   -175.8 %   -0.1 %   0.1 %
Net income   $ 288,000     $ 774,000     $ (486,000 )   -62.8 %   1.3 %   2.6 %

 

 
Express-1 Expedited Solutions, Inc.
Summary Financial Table
For the Six Months Ended June 30,
(Unaudited)
                    Percent of
    Year to Date   Year to Year Change   Business Unit Revenue
    2009   2008   In Dollars   In Percentage   2009   2008
Revenues                        
Express-1   $ 18,978,000     $ 27,777,000     $ (8,799,000 )   -31.7 %   44.8 %   52.0 %

Concert Group Logistics

  19,794,000     24,963,000     (5,169,000 )   -20.7 %   46.8 %   46.8 %
Bounce Logistics   4,012,000     1,228,000     2,784,000     226.7 %   9.5 %   2.3 %
Intercompany eliminations   (469,000 )   (577,000 )   108,000     18.7 %   -1.1 %   -1.1 %
Total revenues   42,315,000     53,391,000     (11,076,000 )   -20.7 %   100.0 %   100.0 %
                         
Direct expenses                        
Express-1   14,669,000     21,305,000     (6,636,000 )   -31.1 %   77.3 %   76.7 %

Concert Group Logistics

  17,926,000     22,716,000     (4,790,000 )   -21.1 %   90.6 %   91.0 %
Bounce Logistics   3,336,000     1,087,000     2,249,000     206.9 %   83.2 %   88.5 %
Intercompany eliminations   (469,000 )   (577,000 )   108,000     18.7 %   100.0 %   100.0 %
Total direct expenses   35,462,000     44,531,000     (9,069,000 )   -20.4 %   83.8 %   83.4 %
                         
Gross margin                        
Express-1   4,309,000     6,472,000     (2,163,000 )   -33.4 %   22.7 %   23.3 %

Concert Group Logistics

  1,868,000     2,247,000     (379,000 )   -16.9 %   9.4 %   9.0 %
Bounce Logistics   676,000     141,000     535,000     379.4 %   16.8 %   11.5 %
Total gross margin   6,853,000     8,860,000     (2,007,000 )   -22.7 %   16.2 %   16.6 %
                         
Selling, general & administrative                        
Express-1   3,452,000     3,780,000     (328,000 )   -8.7 %   18.2 %   13.6 %

Concert Group Logistics

  1,317,000     1,608,000     (291,000 )   -18.1 %   6.7 %   6.4 %
Bounce Logistics   549,000     334,000     215,000     64.4 %   13.7 %   27.2 %
Corporate   931,000     817,000     114,000     14.0 %   2.2 %   1.5 %
Total selling, general & administrative   6,249,000     6,539,000     (290,000 )   -4.4 %   14.8 %   12.2 %
                         
Operating income from continuing operations                        
Express-1   857,000     2,692,000     (1,835,000 )   -68.2 %   4.5 %   9.7 %

Concert Group Logistics

  551,000     639,000     (88,000 )   -13.8 %   2.8 %   2.6 %
Bounce Logistics   127,000     (193,000 )   320,000     165.8 %   3.2 %   -15.7 %
Corporate   (931,000 )   (817,000 )   (114,000 )   -14.0 %   -2.2 %   -1.5 %
Operating income from continuing operations   604,000     2,321,000     (1,717,000 )   -74.0 %   1.4 %   4.3 %
                         
Interest expense   48,000     179,000     (131,000 )   -73.2 %   0.1 %   0.3 %
Other expense   9,000     15,000     (6,000 )   -40.0 %   0.0 %   0.0 %
Income from continuing operations before tax   547,000     2,127,000     (1,580,000 )   -74.3 %   1.3 %   4.0 %
                         
Tax provision   259,000     856,000     (597,000 )   -69.7 %   0.6 %   1.6 %
Income from continuing operations   288,000     1,271,000     (983,000 )   -77.3 %   0.7 %   2.4 %
                         
Income from discontinued operations, net of tax   5,000     146,000     (141,000 )   -96.6 %   0.0 %   0.3 %
Net income   $ 293,000     $ 1,417,000     $ (1,124,000 )   -79.3 %   0.7 %   2.7 %