<PAGE> 1
Filed by: EGL, Inc.
Pursuant to Rule 425 under the Securities Act of 1933 and
deemed filed pursuant to Rule 14a-12 of
the Securities Exchange Act of 1934
Subject Company: Circle International Group, Inc.
Commission File No.: 000-08664
Subject Company: EGL, Inc.
Commission File No.: 000-27288
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AT THE COMPANY |
Elijio V. Serrano | Michael D. Slaughter
Chief Financial Officer | Vice President
| Investor Relations
(281) 618-3665 | (281) 618-3428
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FOR IMMEDIATE RELEASE
JULY 25, 2000
EGL, INC. REPORTS STRONG DOMESTIC GROWTH
REVENUES INCREASED 43% TO A RECORD HIGH
THIRD QUARTER HIGHLIGHTS:
o DOMESTIC AIRFREIGHT FORWARDING REVENUES INCREASED 39% OVER THE PRIOR YEAR
o HIGHEST DOMESTIC FORWARDING REVENUE GROWTH RATE IN NINE QUARTERS
o NET REVENUES INCREASED 38% OVER THE PRIOR YEAR
o PROPOSED MERGER WITH CIRCLE PROCEEDING ON SCHEDULE FOR FALL CLOSE
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QUARTER ENDED
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FINANCIAL & OPERATING DATA 6/30/00 6/30/99 CHANGE
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<S> <C> <C> <C> <C>
Revenues (000's) $213,739 $149,826 43%
Operating Income (000's) $ 13,601 $ 11,072 23%
Net Income (000's) $ 8,461 $ 7,295 16%
Diluted Earnings Per Share $ 0.29 $ 0.25 16%
OPERATING DATA
Freight Forwarding Shipments 653,792 362,331 80%
Total Weight (lbs.) Shipped (000's) 376,698 249,747 51%
Freight Forwarding Terminals 92 78 18%
Local Delivery Locations 77 67 15%
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Chairman and CEO James R. Crane commented: "Our strong results in the quarter
were driven in large part by a significant increase in our domestic business.
Our focused marketing efforts and flexible service model, coupled with excellent
growth in business activity among our customers in the technology and
telecommunication industries, contributed to domestic airfreight forwarding
revenue growth of 39 percent over the prior year. The tremendous work of our
entire staff helped us achieve our highest domestic airfreight forwarding
revenue growth rate in nine quarters. Our international business continues to
show strong results, increasing 76 percent in the quarter. Upon completion of
our previously-announced merger with Circle International Group, we will
strengthen our ability to take advantage of the opportunities we have outside
the U.S."
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<PAGE> 2
EGL, INC
ADD 1
HOUSTON, TEXAS, JULY 25, 2000 - EGL, INC. (NASDAQ: EAGL) today announced
revenues and earnings for the third quarter ended June 30, 2000. Revenues for
the third quarter increased 43 percent to $213.7 million, a record high for EGL,
from $149.8 million in the same period of fiscal 1999. Same terminal revenue
growth for the quarter was 34 percent.
Net income for the quarter totaled $8.5 million, a 16 percent increase over $7.3
million in the third quarter of fiscal 1999. Diluted earnings per share for the
third quarter increased 16 percent to $0.29 from $0.25 in the same period of
fiscal 1999. The current quarter results included approximately $800,000 of
after tax recurring expenses, or $0.03 cents per diluted share, related to the
previously announced program to increase expenditures for international staff
and infrastructure costs.
"Our strong results in the quarter were driven in large part by a significant
increase in our domestic business," said Chairman and CEO James R. Crane. "Our
focused marketing efforts and flexible service model, coupled with excellent
growth in business activity among our customers in the technology and
telecommunication industries, contributed to domestic airfreight forwarding
revenue growth of 39 percent over the prior year. The tremendous work of our
entire staff helped us achieve our highest domestic airfreight forwarding
revenue growth rate in nine quarters."
"Our international business continues to show strong results, increasing 76
percent in the quarter," Crane added. "Upon completion of our
previously-announced merger with Circle International Group, we will strengthen
our ability to take advantage of the opportunities we have outside the U.S."
On July 3, 2000, the Company announced a proposed merger with Circle
International Group under which each of Circle's approximate 17.65 million
shares of common stock will be converted into one share of EGL common stock. The
merger effectively ends the Company's previously announced program to increase
expenditures for international staff and infrastructure costs. EGL expects to
utilize the staff and infrastructure related to this program subsequent to the
completion of the merger.
Also on July 3, 2000, the Company announced that it would change from a fiscal
year to a calendar year in order to facilitate comparisons with its peer
companies and to match its reporting requirements to those of its merger
partner, Circle International Group.
Revenues for the nine months ended June 30, 2000 increased 38 percent to $589.9
million from $428.4 million in the same period of fiscal 1999. Net income
totaled $23.7 million, a 15 percent increase over $20.6 million in the first
nine months of fiscal 1999. Diluted earnings per share of $0.79 increased 11
percent from $0.71 in the same period of fiscal 1999.
During the third quarter, the Company spent approximately $8.8 million on share
repurchases. As a result of the Circle transaction, the Company has discontinued
its share repurchase program. At June 30, 2000, the Company had cash on hand of
$20.0 million and no long-term debt.
<PAGE> 3
EGL, INC
ADD 2
EGL, Inc. operates under the name EGL Eagle Global Logistics. Eagle's dedication
to providing superior flexibility and fewer shipping restrictions on a price
competitive basis has made it a leading provider of heavy-weight airfreight
forwarding and other transportation and logistics services. The Company's
network of 92 terminals in nine countries features state-of-the-art information
systems designed to maximize cargo management efficiency and customer
satisfaction. The Company's shares are traded on the NASDAQ National Market
under the symbol "EAGL."
FORWARD LOOKING STATEMENT AND INVESTOR NOTICE
The statements in this press release regarding future growth, results and
expansion plans, timing and effects of the Circle merger, future business,
operations or results and any other statements, which are not historical facts,
are forward looking statements. Such statements involve risks and uncertainties,
including, but not limited to, competition, costs and difficulties relating to
the Circle merger and the integration of Circle, risks that the merger will be
delayed or not occur, general economic conditions, ability to manage and
continue growth, risks of international operations and other factors detailed in
the Company's filings with the Securities and Exchange Commission. Should one or
more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual outcomes may vary materially from those
indicated.
EGL plans to file with the Securities and Exchange Commission ("SEC") a
registration statement on Form S-4. In the connection with the merger, EGL and
Circle expect to mail a joint proxy statement/prospectus, which will be part of
the registration statement, to shareholders of EGL and Circle containing
information about the merger. Shareholders of EGL and Circle are urged to read
the joint proxy statement/prospectus included in the registration statements
when it is filed and any other relevant documents filed with the SEC. The joint
proxy statement/prospectus will contain important information about EGL, Circle,
the merger, the persons soliciting proxies related to the merger, and related
matters that should be considered by shareholders before making any decision
regarding the merger and related transactions. Once they are filed with the SEC,
the registration statement, joint proxy statement/prospectus and other documents
will be available free of charge on the SEC's web site at http://sec.gov and
from EGL and Circle. In addition to the registration statement and the joint
proxy statement/prospectus, EGL and Circle file annual, quarterly and special
reports, proxy statements and other information with the SEC that are also
available free of charge at the SEC's web site and from EGL and Circle.
In addition, the identity of the people who, under SEC rules, may be considered
"participants in the solicitation" of EGL shareholders and Circle shareholders
in connection with the proposed merger, and any description of their interests,
is available in an SEC filing under Schedule 14A made by both EGL and Circle on
July 3, 2000.
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FOR MORE INFORMATION ABOUT EAGLE:
---------------------------------
CONTACT EAGLE INVESTOR RELATIONS VIA THE INTERNET AT [email protected]
OR BY TELEPHONE AT 281/618-3428, MICHAEL SLAUGHTER, VICE PRESIDENT OF
INVESTOR RELATIONS.
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<PAGE> 4
EGL, INC
ADD 3
EGL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
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<CAPTION>
Three Months Nine Months
Ended June 30, Ended June 30,
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2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Revenues $ 213,739 $ 149,826 $ 589,855 $ 428,424
Cost of transportation 125,807 86,133 346,695 243,455
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Net revenue 87,932 63,693 243,160 184,969
Personnel costs 45,831 32,012 128,605 93,955
Other selling, general and admin. costs 28,500 20,609 77,106 59,411
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Operating income 13,601 11,072 37,449 31,603
Interest and other income 469 751 1,745 1,934
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Income before provision for income taxes 14,070 11,823 39,194 33,537
Provision for income taxes 5,609 4,528 15,495 12,961
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Net income $ 8,461 $ 7,295 $ 23,699 $ 20,576
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Basic earnings per share (1) $ 0.30 $ 0.26 $ 0.83 $ 0.73
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Diluted earnings per share (1) $ 0.29 $ 0.25 $ 0.79 $ 0.71
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Basic weighted-average common
Shares outstanding (1) 28,646 28,401 28,676 28,218
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Diluted weighted-average common
Shares outstanding (1) 29,451 29,585 29,828 28,925
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(1) - Adjusted for a 3-for-2 stock split effective August 30, 1999.
<PAGE> 5
EGL, INC
ADD 4
EGL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
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<CAPTION>
June 30, September 30,
2000 1999
(unaudited) (audited)
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<S> <C> <C>
ASSETS
Current assets :
Cash, cash equivalents and short-term
Investments $ 19,977 $ 52,388
Accounts receivable, net 134,447 109,003
Prepaid expenses and other 8,587 6,529
-----------------------------------
Total current assets 163,011 167,920
Property and equipment, net 38,481 28,184
Goodwill and other assets 42,293 12,887
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Total assets $ 243,785 $ 208,991
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued transportation $ 40,299 $ 34,552
Other current liabilities 30,309 27,532
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Total current liabilities 70,608 62,084
Other liabilities 6,425 3,097
Minority interest (12) 183
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Shareholders' equity 166,764 143,627
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Total liabilities and shareholders' equity $ 243,785 $ 208,991
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