SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q/A
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 0-24908
TRANSPORT CORPORATION OF AMERICA, INC.
--------------------------------------
(Exact name of registrant as specified in its charter)
MINNESOTA 41-1386925
- --------------------------------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1769 YANKEE DOODLE ROAD
EAGAN, MINNESOTA 55121
----------------------
(Address of principal executive offices and zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (651) 686-2500
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days: YES _X_ NO ___
As of February 11, 2000, the Company had outstanding 8,318,546 shares of Common
Stock, $.01 par value.
---------------------------------
<PAGE>
TRANSPORT CORPORATION OF AMERICA, INC.
Quarterly Report on Form 10-Q/A
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements and Notes
Consolidated Balance Sheets as of
September 30, 1999 and December 31, 1998---------------------Page 3
Consolidated Statements of Earnings for the three and
nine months ended September 30, 1999 and 1998----------------Page 4
Consolidated Statements of Cash Flows for the
nine months ended September 30, 1999 and 1998----------------Page 5
Notes to Consolidated Financial Statements--------------------Page 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations------------------------------------Page 7
Item 3. Quantitative and Qualitative Disclosures about Market Risk----Page 14
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K------------------------------Page 14
2
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
Transport Corporation of America, Inc.
Consolidated Balance Sheets
(In thousands)
<TABLE>
<CAPTION>
September 30, December 31,
1999 1998
------------ ------------
(unaudited)
(as restated)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 1,168 $ 448
Trade accounts receivable, net 34,552 27,403
Other receivable 2,664 1,593
Operating supplies - inventory 1,575 1,378
Deferred income tax benefit 6,383 5,443
Prepaid expenses and tires 3,513 2,212
------------ ------------
Total current assets 49,855 38,477
Property and equipment:
Land, buildings, and improvements 21,263 18,759
Revenue equipment 224,682 179,042
Other equipment 13,615 9,905
------------ ------------
Total property and equipment 259,560 207,706
Less accumulated depreciation (53,667) (46,946)
------------ ------------
Property and equipment, net 205,893 160,760
Other assets, net 26,265 25,315
------------ ------------
Total assets $ 282,013 $ 224,552
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $ 15,753 $ 13,717
Accounts payable 6,513 7,207
Checks issued in excess of cash balances 4,448 426
Due to independent contractors 2,987 2,126
Accrued expenses 13,993 11,795
------------ ------------
Total current liabilities 43,694 35,271
Long term debt, less current maturities 106,809 79,531
Deferred income taxes 35,939 27,749
1,200,000 shares of common stock with non-detachable put 20,268 20,268
Stockholders' equity:
Common stock 71 67
Additional paid-in capital 28,977 24,093
Retained earnings 46,255 37,573
------------ ------------
Total stockholders' equity 75,303 61,733
------------ ------------
Total liabilities and stockholders' equity $ 282,013 $ 224,552
============ ============
</TABLE>
3
<PAGE>
Transport Corporation of America, Inc.
Consolidated Statements of Earnings
(In thousands, except share and per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
--------------------------- ---------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
(as restated) (as restated)
<S> <C> <C> <C> <C>
Operating revenues $ 70,722 $ 74,087 $ 212,901 $ 176,650
Operating expenses:
Salaries, wages, and benefits 19,667 18,497 59,083 49,662
Fuel, maintenance, and other expenses 7,778 7,175 22,855 20,377
Purchased transportation 24,459 27,786 72,640 57,183
Revenue equipment leases 497 907 2,199 2,822
Depreciation and amortization 6,690 5,473 18,707 14,577
Insurance, claims and damage 1,477 2,139 5,350 5,054
Taxes and licenses 1,344 1,194 3,944 2,944
Communications 838 792 2,424 2,057
Other general and administrative expenses 2,001 2,419 6,487 6,491
Gain on sale of equipment (395) (180) (535) (239)
----------- ----------- ----------- -----------
Total operating expenses 64,356 66,202 193,154 160,928
----------- ----------- ----------- -----------
Operating income 6,366 7,885 19,747 15,722
Interest expense 2,040 1,429 5,538 3,616
Interest income (8) (5) (35) (118)
----------- ----------- ----------- -----------
Interest expense, net 2,032 1,424 5,503 3,498
----------- ----------- ----------- -----------
Earnings before income taxes 4,334 6,461 14,244 12,224
Provision for income taxes 1,690 2,521 5,562 4,770
----------- ----------- ----------- -----------
Net earnings $ 2,644 $ 3,940 $ 8,682 $ 7,454
=========== =========== =========== ===========
Net earnings per share:
Basic $ 0.32 $ 0.50 $ 1.07 $ 1.05
=========== =========== =========== ===========
Diluted $ 0.31 $ 0.48 $ 1.02 $ 1.03
=========== =========== =========== ===========
Average common shares outstanding:
Basic 8,244,409 7,914,611 8,085,156 7,099,019
Diluted 8,501,913 8,225,272 8,503,673 7,259,381
</TABLE>
4
<PAGE>
Transport Corporation of America, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
<TABLE>
<CAPTION>
Nine months ended
September 30,
-----------------------------
1999 1998
------------ ------------
(as restated)
<S> <C> <C>
Operating activities:
Net earnings $ 8,682 $ 7,454
Adjustments to reconcile net earnings to net cash provided
by operating activities:
Depreciation and amortization 18,707 14,577
Gain on sale of equipment (535) (239)
Deferred income taxes 5,563 3,549
Changes in operating assets and liabilities,
net of acquisitions:
Trade receivable (4,384) (4,208)
Other receivable (1,010) 3,295
Operating supplies (197) (261)
Prepaid expenses and tires (959) (125)
Accounts payable (1,811) (645)
Due to independent contractors 823 1,257
Accrued expenses 269 5,294
------------ ------------
Net cash provided by operating activities 25,148 29,948
------------ ------------
Investing activities:
Purchases of revenue equipment (53,333) (36,919)
Purchases of property and other equipment (6,213) (3,230)
Payments for other assets (346) 0
Acquisition of business, net of cash acquired (2,611) (15,555)
Proceeds from sales of equipment 17,943 3,767
------------ ------------
Net cash used in investing activities (44,560) (51,937)
------------ ------------
Financing activities:
Proceeds from issuance of common stock,
and exercise of options and warrants 988 559
Payments for repurchase and retirement of common stock 0 (66)
Proceeds from issuance of long-term debt 165 10,577
Principal payments on long-term debt (18,043) (33,968)
Proceeds from issuance of notes payable to bank 114,866 61,350
Principal payments on notes payable to bank (81,866) (21,350)
Change in net checks issued in excess of cash balances 4,022 3,711
------------ ------------
Net cash provided by financing activities 20,132 20,813
------------ ------------
Net increase (decrease) in cash 720 (1,176)
Cash and cash equivalents, beginning of period 448 1,383
------------ ------------
Cash and cash equivalents, end of period $ 1,168 $ 207
============ ============
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 5,439 $ 3,501
Income taxes, net 634 254
</TABLE>
5
<PAGE>
TRANSPORT CORPORATION OF AMERICA, INC.
Notes to Consolidated Financial Statements
1. Interim Financial Statements (unaudited)
The unaudited interim consolidated financial statements contained
herein reflect all adjustments which, in the opinion of management,
are necessary for a fair presentation of the interim periods. They
have been prepared in accordance with the instructions to Form 10-Q,
Article 10 of Regulation S-X and, accordingly, do not include all the
information and footnotes required by generally accepted accounting
principles for complete financial statements. These financial
statements should be read in conjunction with the audited financial
statements and footnotes included in the Company's Annual Report on
Form 10-K for the year ended December 31, 1998. The policies described
in that report are used in preparing interim reports. Certain balances
from prior periods have been reclassified to conform to current
presentation.
The Company's business is seasonal. Operating results for the
nine month period ended September 30, 1999 are not necessarily
indicative of the results that may be expected for the year ending
December 31, 1999.
2. Commitments
As of September 30, 1999, the Company had commitments to purchase
approximately $13.5 million of revenue equipment, net of anticipated
proceeds from the disposition of used equipment.
In April of 1999, the Company entered into a five-year operating
lease for the construction of a new headquarters facility in Eagan,
Minnesota. Construction is expected to be complete in the first
quarter of 2000. The aggregate lease payments are contingent on the
final construction costs, which are currently estimated to be $13
million.
3. Acquisition
Effective May 1, 1999, the Company issued 350,000 shares of its
common stock as a portion of the purchase price to acquire Robert
Hansen Trucking, Inc. ("RHT") The purchase price consists of $2.2
million in cash and shares of the Company's common stock. Based upon
the final determination of post acquisition adjustments to the
purchase price, the Company retired 40,000 of the previously issued
shares in the fourth quarter of 1999.
6
<PAGE>
4. Restatement of Results
The Company has restated its results for the three and nine month
periods ended September 30, 1999. As a result, revenues, operating
expenses, net income, and diluted earnings per share for the three
month period ended September 30, 1999 were restated from $72,022,000,
$65,058,000, $2,976,000, and $0.35 to $70,722,000, $64,356,000,
$2,644,000, and $0.31, respectively. Correspondingly, revenues,
operating expenses, net income, and diluted earnings per share for the
nine month period ended September 30, 1999 were restated from
$214,201,000, $193,856,000, $9,014,000, and $1.06 to $212,901,000,
$193,154,000, $8,682,000, and $1.02, respectively.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Three Months Ended September 30, 1999 and 1998
During the third quarter of 1999, the Company's results were
negatively impacted by computer database problems associated with an
information systems upgrade, which limited the Company's ability to
handle approximately 2,000 normally scheduled loads during the
quarter. The lost loads contributed to fluctuations in revenue and
several expense categories when compared to the third quarter of 1998.
Operating revenues decreased 4.5% to $70.7 million for the
quarter ended September 30, 1999 from $74.1 million for the quarter
ended September 30, 1998. The decrease in revenue was primarily due to
computer database problems associated with the information systems
upgrade and a shortage of drivers. Revenue per mile, excluding fuel
surcharges, decreased to $1.25 in the third quarter of 1999, compared
to $1.28 for the same period of 1998. The decline in revenue per mile
reflects changes in the Company's freight mix. Equipment utilization,
as measured by average revenue per tractor per week, was $2,590 during
the third quarter of 1999, compared to $2,879 in the third quarter of
1998. The decline reflects decreased equipment utilization resulting
from the historically lower utilization of the RHT business, which was
acquired in May, 1999, a higher percentage of empty miles driven, and
the computer database problems associated with the information systems
upgrade.
7
<PAGE>
Pre-tax margin (earnings before income taxes as a percentage of
operating revenues) was 6.1% in the third quarter of 1999, compared to
8.7% in the same period of 1998. Efficiency, as measured by average
annualized revenues per non-driver employee was $536,800 for the third
quarter of 1999, compared to $645,300 for the same period of 1998. The
decline is attributable to the computer database problems associated
with the information systems upgrade and increased headcount.
Salaries, wages, and benefits as a percentage of operating revenues
increased to 27.8% in the third quarter of 1999, compared to 25.0% for
the same period of 1998. The increased percentage in 1999 is primarily
a result of the combination of the decline of revenues, a greater
proportion of miles driven by employee drivers, as well as increased
wages resulting from addressing the computer database problems
associated with the information systems upgrade. The increased wages
included employee overtime and additional non-revenue-generating
driver pay. Fuel maintenance and other expenses, as a percentage of
operating revenues, increased to 11.0% in the third quarter of 1999
from 9.7% for the third quarter of 1998 primarily as a result of
increased fuel prices in 1999 and an increase in the percentage of
miles driven by company drivers in 1999 when compared to 1998. The
decline in the percentage of miles driven by independent contractors
resulted in a decrease in purchased transportation as a percentage of
operating revenues to 34.6% in the third quarter of 1999 compared to
37.5% in 1998. Taxes and licenses as a percentage of operating
revenues was 1.9% in the third quarter of 1999 compared to 1.6% in the
third quarter of 1998. Revenue equipment leases decreased as a
percentage of operating revenues to 0.7% in the third quarter of 1999
from 1.2% for the same period of 1998, primarily as a result of a
decrease in the use of leases. Depreciation and amortization for the
third quarter of 1999 was 9.5% of operating revenues, compared to 7.4%
for the same period of 1998, primarily resulting from a smaller
portion of revenue equipment supplied by independent contractors
during the third quarter of 1999. Improved accident and claims
experience resulted in a decrease of insurance, claims, and damage
expense as a percentage of operating revenues to 2.1% in the third
quarter of 1999 from 2.9% for the same quarter in 1999. Other general
and administrative expenses as a percentage of operating revenues were
2.8% in the third quarter of 1999, compared to 3.2% for the same
period of 1998.
Net interest expense in the third quarter of 1999 was 2.9% of
operating revenues, compared to 1.9% for the same period of 1998,
resulting from increased debt balances relating to the acquisition of
RHT and purchases of revenue equipment to replace older, less
efficient equipment obtained in the acquisition.
Gain on the disposition of equipment was $395,000 in the third
quarter of 1999, compared to a gain on $180,000 in the same quarter of
1998. The effective tax rate for the third quarters of 1999 and 1998
was 39.0%.
8
<PAGE>
As a consequence of the items discussed above, net earnings
decreased to $2.6 million, or 3.7 % of operating revenues for the
quarter ended September 30, 1999 from $3.9 million, or 5.3% of
operating revenues for the quarter ended September 30, 1998.
Nine Months Ended September 30, 1999 and 1998
Operating revenues increased 20.5% to $212.9 million for the nine
months ended September 30, 1999 from $176.7 million for the first nine
months of 1998. This increase resulted from revenue growth from
existing customers as well as additional revenues attributable to the
North Star Transport, Inc. ("North Star") and RHT acquisitions,
partially offset by the computer database problems associated with the
information systems upgrade encountered in the third quarter of 1999.
North Star was acquired July 1, 1998. Revenue per mile was $1.27 for
both nine month periods of 1999 and 1998. Equipment utilization, as
measured by average revenue per tractor per week, declined to $2,674
during the first nine months of 1999 from $2,851 for the same period
of 1998. The decline reflects decreased equipment utilization
resulting from the historically lower utilization in the North Star
and RHT businesses.
Pre-tax margin (earnings before income taxes as a percentage of
operating revenues) was 6.7% and 6.9% in the first nine months of 1999
and 1998, respectively. Efficiency, as measured by average annualized
revenues per non-driver employee was $567,400 for the first nine
months of 1999 compared to $589,100 for the same period of 1998.
Salaries, wages, and benefits, as a percentage of operating revenues,
declined to 27.8% in the first nine months of 1999, compared to 28.1%
for the same period of 1998, resulting primarily from a decrease in
the percentage of miles driven by employee drivers in the first nine
months of 1999, compared to the same period of 1998. Correspondingly,
purchased transportation increased as a percentage of operating
revenues to 34.1% in the first nine months of 1999 from 32.4% for the
same period of 1998. Fuel, maintenance, and other expenses decreased
as a percentage of operating revenues to 10.8% in the first nine
months of 1999 from 11.5% for the same period of 1998, reflecting an
increased percentage of miles driven by independent contractors in the
first nine months of 1999, partially offset by higher fuel prices in
1999 when compared to 1998. Revenue equipment leases decreased as a
percentage of operating revenues to 1.0% in the first nine months of
1999 from 1.6% for the same period of 1998, primarily as a result of a
decrease in the use of leases. Depreciation and amortization increased
as a percentage of operating revenues to 8.8% in the first nine months
of 1999, compared to 8.2% for the same period of 1998, primarily
resulting from amortization of goodwill obtained in the North Star and
RHT acquisitions and increases in company owned revenue equipment
during the first nine months of 1999. Other general and administrative
expenses as a percentage of operating revenues were 3.0% in the first
nine months
9
<PAGE>
of 1999, compared to 3.7% for the same period of 1998, reflecting
the Company's ability to absorb the operations of RHT and North Star
without significantly increasing its non-wage related indirect
costs.
In the first nine months of 1999, gain on the disposition of
equipment was $535,000, compared to a gain of $239,000 in the first
nine months of 1998.
Net interest expense in the first nine months of 1999 was 2.6% of
operating revenues, compared to 2.0% for the same period of 1998,
primarily a reflection of the higher average outstanding debt
associated with the acquisition of North Star and RHT. In addition,
the Company increased its purchases of revenue equipment to replace
older, less efficient equipment obtained in the acquisition.
The effective tax rates for the first nine months of 1999 and
1998 were 39.0%.
As a consequence of the items discussed above, net earnings
increased to $8.7 million, or 4.1% of operating revenues, for the nine
months ended September 30, 1999 from $7.5 million, or 4.2% of
operating revenues, for the nine months ended September 30, 1998.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities was $25.1 million in
the first nine months of 1999. Working capital as of September 30,
1999 was $6.2 million, compared to $3.2 million as of December 31,
1998. Accrued liabilities include normal provisions for accident and
workers' compensation claims associated with the Company's
self-insured retention insurance program, less claim payments actually
made. The Company believes that its reserves and liquidity are
adequate for expected future claim payments.
Investing activities in the first nine months of 1999 consumed
net cash of $44.6 million, primarily for the purchase of 343 new
tractors and 1,013 new trailers, less proceeds from the disposition of
used equipment. This purchase activity is a result of the Company's
strategy to replace older, less efficient equipment acquired in the
North Star and RHT acquisitions. The Company expects capital spending
on revenue equipment to decrease in the last quarter of the year.
Also, included in investing activities is $2.6 million consumed for
the acquisition of RHT. As of September 30, 1999, the Company had
commitments for the purchase of approximately $13.5 million of revenue
equipment and real estate. The Company expects to use cash provided by
operating activities to purchase the revenue equipment.
10
<PAGE>
Net cash provided by financing activities was $20.1 million in
the first nine months of 1999, including $33.0 million representing
net proceeds from the Company's credit facility less a net reduction
of other long term debt by $17.9 million.
In April of 1999, the Company entered into a five-year operating
lease for the construction of a new headquarters facility in Eagan,
Minnesota. Construction is expected to be complete in the first
quarter of 2000. The aggregate lease payments are contingent on the
final construction costs, which are currently estimated to be $13
million.
The Company has a credit agreement with seven major banks for an
unsecured credit facility with maximum combined borrowings and letters
of credit of $100 million. Amounts actually available under the credit
facility are limited by the Company's accounts receivable and
unencumbered revenue equipment. The credit facility, which was
extended one year during the quarter, expires in March 2002. The
facility is used to meet working capital needs, purchase revenue
equipment and other assets, satisfy letter of credit requirements
associated with the Company's self-insured retention arrangements, and
for acquisitions. At September 30, 1999, there were outstanding
borrowings of $86.0 million under this credit facility. The Company
expects to continue to fund its liquidity needs and anticipated
capital expenditures with cash flows from operations and the credit
facility.
RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998, The FASB issued Statement of Financial Accounting
Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities" ("Statement No. 133"). Statement No. 133 requires that an
enterprise recognize all derivatives as either assets or liabilities
in the consolidated balance sheet and measure those instruments at
fair value. Statement No. 133 is effective for all fiscal quarters of
all fiscal years beginning after June 15, 2000. The Company is
currently assessing the effect, if any, of Statement No. 133 on its
financial statements.
11
<PAGE>
YEAR 2000
GENERAL STATE OF READINESS:
The Company has instituted a Steering Committee (the "Committee")
to assess the readiness and take remedial action to correct the
Company's systems to accommodate Year 2000 ("Y2K") issues. The
Committee, consisting of senior management representing both technical
and operating departments, is charged with developing a project plan,
detailed management and remediation plans, as well as execution of
these plans.
Under the guidance of the Committee, an inventory and assessment
of all systems has been completed. Remediation for non-compliant
systems has also been completed, with the exception of two
non-critical applications. These remaining two applications are being
tested and certified, with completion expected in November 1999.
The Company is dependent upon system-based relationships with
outside parties, including customers, banks, payroll processors,
suppliers, communication service providers, and other business
partners. The Company has outlined its core business processes and
identified customers and vendors who are critical to these processes.
As a result of a series of phone and printed surveys of its business
partners, the Company has determined the degree of impact on Company
operations, should any of these outside parties fail to achieve Y2K
compliance. Remediation actions and alternate procedures have been
developed to overcome any significant business partner issues
discovered as a result of the surveys.
COSTS TO ADDRESS THE COMPANY'S Y2K ISSUES
The Company believes that the costs of addressing internal Y2K
issues will not have a material adverse effect upon its results of
operations or financial condition. To date, internal costs associated
with Y2K compliance have been approximately $450,000.
RISKS ASSOCIATED WITH THE COMPANY'S Y2K ISSUES
The Company believes that it has substantially implemented the
necessary changes to its internal systems to achieve Y2K compliance,
except for two non-critical systems, which will be made compliant in
November 1999. Should unanticipated systems failures occur, the
Company believes that alternative manual procedures exist that could
minimize the disruption caused by a Y2K failure until changes are made
to resolve such a disruption. However, such manual procedures would
not likely be effective for an extended period of time.
12
<PAGE>
The Company is dependent upon third party resources, which are
outside its direct control. Among the more critical of these is the
telecommunication system, upon which the Company depends to receive
customer orders and direct driver movements. Daily activities are very
dependent upon voice-based phone systems and satellite-based
communication systems. Failure of the voice-based phone system would
pose a critical loss of capabilities, only partially offset by
satellite communication options. The Company believes that its third
party resources are substantially Y2K compliant.
Several critical relationships exist between the Company and its
customers, particularly those who electronically initiate order
transactions with the Company or interact directly with the Company's
systems. Failure of the Company's customers to achieve Y2K compliance
could jeopardize the Company's ability to transact business
electronically with those customers. In the event of a customer's Y2K
failure, the success of manual interim processes will be largely out
of the Company's control. The Company has actively coordinated with
its major customers the assessment and remediation of Y2K compliance
issues and believes that its electronic business transactions with
these customers are substantially Y2K compliant.
CONTINGENCY PLANS
The Company has developed and implemented a comprehensive Y2K
Contingency Plan. The plan includes alternative manual and electronic
procedures. Successful contingency tests were completed in August
1999. The Company expects to perform a second contingency test in
December 1999.
FORWARD-LOOKING STATEMENTS
The Company has included various statements in this Management's
Discussion and Analysis and Results Of Operations which may be
considered as forward-looking statements of expected future results of
operations or events made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. Such statements,
based upon management's interpretation of currently available
information, are subject to risks and uncertainties that could cause
future financial results or events to differ materially from those
which are presented. Such risks and factors include general economic
conditions, competition in the transportation industry, governmental
regulation, the Company's ability to recruit, train and retain
qualified drivers, the cost of fuels, customer decisions to meet their
transportation needs, the ability of the Company to maintain a higher
level of service than its competitors, the integration of its
acquisition of RHT, adverse weather conditions, and other factors
outside the Company's control. The Company wishes to caution readers
not to place undue
13
<PAGE>
reliance on any such forward-looking statements, which speak only as
of the date made.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Company is exposed to certain market risks with its $100
million credit agreement, of which $86.0 million outstanding at
September 30, 1999. The agreement bears interest at a variable rate,
which was 6.3% at September 30, 1999. In addition, the Company has
outstanding 1.2 million shares of common stock with a non-detachable
Put option. The Put gives the shareholders the right to sell some or
all of the 1.2 million shares back to the Company at $16.89 per share,
payable in cash, during a 60-day period commencing June 30, 2001.
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K:
(a) Exhibits:
Exhibit
Number Description
------ -----------
11.1 Statement re: Computation of Net Earnings per Share
27 Financial Data Schedule
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the quarter ended
September 30, 1999.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRANSPORT CORPORATION OF AMERICA, INC.
Date: February 16, 2000 /s/ Robert J. Meyers
----------------- ----------------------------------------
Robert J. Meyers
President and Chief Operating Officer
/s/ Keith R. Klein
----------------------------------------
Keith R. Klein
Chief Financial Officer
15
EXHIBIT 11.1
Transport Corporation of America, Inc.
Computation of Earnings per Common Share
(In thousands, except share and per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
------------------------ ------------------------
1999 1998 1999 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net earnings $ 2,644 $ 3,940 $ 8,682 $ 7,454
========== ========== ========== ==========
Average number of common
shares outstanding 7,044,409 6,714,611 6,885,156 6,699,019
Average number of common shares outstanding,
non-detachable put 1,200,000 1,200,000 1,200,000 400,000
---------- ---------- ---------- ----------
Average number of common shares outstanding,
including non-detachable put 8,244,409 7,914,611 8,085,156 7,099,019
Dilutive effect of outstanding stock
options and warrants 41,053 49,167 36,622 73,197
Dilutive effect of non-detachable put option 216,451 261,494 381,895 87,165
---------- ---------- ---------- ----------
Average number of common and dilutive potential
common shares outstanding 8,501,913 8,225,272 8,503,673 7,259,381
========== ========== ========== ==========
Basic earnings per share $ 0.32 $ 0.50 $ 1.07 $ 1.05
========== ========== ========== ==========
Diluted earnings per share $ 0.31 $ 0.48 $ 1.02 $ 1.03
========== ========== ========== ==========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,168
<SECURITIES> 0
<RECEIVABLES> 34,552
<ALLOWANCES> 0
<INVENTORY> 1,575
<CURRENT-ASSETS> 49,855
<PP&E> 259,560
<DEPRECIATION> 53,667
<TOTAL-ASSETS> 282,013
<CURRENT-LIABILITIES> 43,694
<BONDS> 106,809
0
0
<COMMON> 71
<OTHER-SE> 75,232
<TOTAL-LIABILITY-AND-EQUITY> 282,013
<SALES> 0
<TOTAL-REVENUES> 212,901
<CGS> 0
<TOTAL-COSTS> 193,154
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,538
<INCOME-PRETAX> 14,244
<INCOME-TAX> 5,562
<INCOME-CONTINUING> 8,682
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,682
<EPS-BASIC> 1.07
<EPS-DILUTED> 1.02
</TABLE>
