FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended December 23, 1995
Commission file number 1-2936
SCHWERMAN TRUCKING CO.
(Exact name of registrant as specified in its charter)
Wisconsin 39-0767397
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P. O. Box 1601, 611 South 28 Street, Milwaukee, WI 53201
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(Address of principal executive offices) (Zip Code)
414/671-1600
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(Registrant's telephone number, including area code)
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
--- ---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Outstanding at
Class January 31, 1996
----- ----------------
Common, $1 par value 422,089
<PAGE>
SCHWERMAN TRUCKING CO. AND SUBSIDIARIES
INDEX
Page No.
PART I. Financial Information:
Consolidated Condensed Balance Sheet at
December 23, 1995 and March 25, 1995 3
Consolidated Condensed Statements of Income
for the three months and nine months ended
December 23, 1995 and December 24, 1994 4
Consolidated Condensed Statements of Cash Flows
for the nine months ended December 23, 1995
and December 24, 1994 5
Notes to Consolidated Condensed Financial Statements 6
Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II. Other Information 8
<PAGE>
<TABLE>
SCHWERMAN TRUCKING CO. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<CAPTION>
DECEMBER 23, MARCH 25,
ASSETS 1995 1995
------------ ---------
(Unaudited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 151,649 $ 87,702
Accounts receivable (less allowances of
$40,000) 3,945,896 4,133,229
Other accounts and notes receivable 115,387 1,262,769
Operating supplies and parts 1,063,864 1,042,136
Tires in service 760,842 745,540
Prepaid expenses 343,753 615,367
Other current assets 200,709 218,319
---------- ---------
6,582,100 8,105,062
---------- -----------
Property, plant and equipment at cost 54,367,542 48,899,216
Less accumulated depreciation and amortization (33,876,393) (31,839,996)
----------- -----------
20,491,149 17,059,220
----------- -----------
Receivable from parent and affiliates 915,325 1,248,363
Other non-current assets 1,384,073 1,145,008
----------- -----------
$29,372,647 $27,557,653
=========== ===========
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current Liabilities:
Current portion of long-term debt $ 3,060,874 $ 2,226,147
Accounts payable 1,418,205 2,291,342
Accrued liabilities 3,028,639 3,499,759
Income taxes payable 441,702 84,128
Deferred income taxes - current 367,659 367,659
----------- -----------
8,317,079 8,469,035
----------- -----------
Long-term debt 9,527,411 9,485,233
Deferred income taxes 1,629,096 1,174,596
Other non-current liabilities 1,155,027 1,089,518
Stockholders' Equity
Preferred stock 1,497,470 1,497,470
Common stock 422,089 422,089
Additional paid-in capital 232,792 232,792
Retained earnings 6,591,683 5,186,920
----------- -----------
8,744,034 7,339,271
----------- -----------
$29,372,647 $27,557,653
=========== ===========
<FN>
The accompanying notes are an integral part of the
condensed consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
SCHWERMAN TRUCKING CO. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
<CAPTION>
--Three Months Ended-- --Nine Months Ended--
Dec. 23, Dec. 24, Dec. 23, Dec. 24,
1995 1994 1995 1994
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenues
Operating revenues $13,459,793 $15,146,799 $44,595,672 $46,827,190
Equipment and other rentals 224,595 176,712 647,383 585,309
Other 553,749 568,123 1,727,616 1,780,057
----------- ----------- ----------- ----------
14,238,137 15,891,634 46,970,671 49,192,556
----------- ----------- ----------- ----------
Operating Expenses
Salaries, wages and fringe
benefits 6,591,321 7,047,228 21,179,390 21,165,700
Fuel and fuel taxes 1,333,586 1,507,909 4,409,186 4,620,628
Parts, repairs and tires 969,198 991,550 2,936,486 2,929,095
Insurance and workers'
compensation 949,159 1,094,129 3,122,120 3,635,653
Depreciation & amort. 930,712 783,806 2,733,601 2,340,979
Purchased transportation 1,215,955 1,419,342 3,955,775 4,459,796
Rent expense 284,696 342,313 873,957 1,073,764
Other operating expenses 1,407,338 1,402,374 4,407,756 4,303,748
(Gain) loss on disposal
of property, plant and
equipment, net 10,620 (850) (16,132) (340,423)
----------- ----------- ----------- ----------
13,692,585 14,587,801 43,602,139 44,188,940
----------- ----------- ----------- -----------
Operating income 545,552 1,303,833 3,368,532 5,003,616
Interest expense, net 301,409 239,174 976,152 807,777
----------- ----------- ----------- -----------
Income before income taxes &
extraordinary item 244,143 1,064,659 2,392,380 ,195,839
Federal and state income taxes 93,000 426,000 909,000 1,678,000
----------- ----------- ----------- ----------
Income before extraordinary
item 151,143 638,659 1,483,380 2,517,839
Extraordinary item - write off
of operating rights, net -- -- -- 367,034
----------- ----------- ----------- -----------
Net Income 151,143 638,659 1,483,380 2,150,805
Dividends on preferred shares (26,205) (26,205) (78,617) (78,617)
----------- ---------- ----------- -----------
Net income applicable common
shares $ 124,938 $ 612,454 $ 1,404,763 $ 2,072,188
=========== ========== =========== ===========
Weighted Average Number of
Common Shares Outstanding 422,089 422,089 422,089 422,089
=========== =========== =========== ===========
Net Income Per Common Share $ .30 $ 1.45 $ 3.33 $ 4.91
=========== =========== =========== ===========
<FN>
The accompanying notes are an integral part of the
condensed consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
SCHWERMAN TRUCKING CO. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
--Nine Months Ended--
December 23, December 24,
1995 1994
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 1,483,380 $ 2,150,805
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities:
Depreciation and amortization 2,733,601 2,340,979
Provision for deferred income taxes 454,500 839,000
Provision for Doubtful accounts 15,558 --
(Gain) loss on disposal of
property, plant and equipment (16,132) (340,423)
Extraordinary item -- 367,034
Change in assets and liabilities:
Accounts and notes receivable 1,319,157 (543,760)
Operating supplies and parts (21,728) (66,377)
Tires in service, prepaid expenses
and other current assets 273,922 249,599
Receivable from parent and affiliates 333,038 (142,905)
Other noncurrent assets (239,065) 37,046
Accounts payable (873,137) (227,062)
Accrued liabilities (471,120) 1,017,001
Income taxes payable 357,574 256,891
Other noncurrent liabilities 65,509 (5,200)
----------- -----------
Net cash provided by (used in)
operating activities 5,415,057 5,932,628
----------- -----------
Cash flows from investing activities:
Proceeds from sale of property,
plant and equipment 119,570 458,871
Payments for property, plant and equipment (2,666,149) (812,730)
----------- -----------
Net cash provided by (used in)
investing activities (2,546,579) (353,859)
----------- -----------
Cash flows from financing activities:
Proceeds from long-term debt 1,593,323 788,000
Payments of long-term debt (4,319,237) (6,020,065)
Redemption of preferred stock -- (12,477)
Preferred stock dividends (78,617) (419,293)
----------- -----------
Net cash provided by (used in)
financing activities (2,804,531) (5,663,835)
----------- -----------
Increase(decrease) in cash & cash equivalents 63,947 (85,066)
Cash and cash equivalents:
Beginning of year 87,702 92,151
----------- -----------
End of year $ 151,649 $ 7,085
=========== ===========
Cash paid during the year for:
Interest $ 974,637 $ 803,776
Income taxes $ 96,926 $ 582,109
<FN>
The accompanying notes are an integral part of the
condensed consolidated financial statements.
</TABLE>
<PAGE>
SCHWERMAN TRUCKING CO. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. CONDENSED FINANCIAL STATEMENTS
In the opinion of management, the accompanying unaudited consolidated
condensed financial statements contain all adjustments (consisting of
only normal recurring accruals) necessary to present fairly the
consolidated financial position of Schwerman Trucking Co. and
Subsidiaries as of December 23, 1995 and March 25, 1995, and the
consolidated results of operations for the three months and nine months
ended December 23, 1995 and December 24, 1994 and changes in financial
position for the nine months then ended.
The results of operations for the three months and nine months ended
December 23, 1995 and December 24, 1994 are not necessarily indicative
of the results to be expected for a full year.
Certain information and financial statement disclosures normally
included in financial statements prepared in accordance with Generally
Accepted Accounting Principles have been condensed or omitted pursuant
to S.E.C. rules and regulations. The Company believes that the
disclosures made are adequate to make the information not misleading.
These financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's Form 10-
K for the year ended March 25, 1995.
2. STATEMENT OF CASH FLOW
The Company had non-cash property, plant and equipment additions
totaling $3,602,819 and $5,482,546 for the nine months ended December
23, 1995 and December 24, 1994, respectively, which were financed
through capital leases and equipment obligations.
<PAGE>
Management's Discussion and Analysis of Financial Condition
and Results of Operations
RESULTS OF OPERATIONS
Revenues for the three months ended December 23, 1995 were approximately
$1,653,000 or 10.4% lower than the comparable three-month period of 1994.
Revenues for the nine months ended December 23, 1995 decreased
approximately $2,222,000 or 4.5% compared to the same period of 1994. The
decrease in revenue is due to a decrease in the number of loads hauled and
miles run for the quarter, and year to date, as compared to the same
periods last year. There has been a general weakness in the markets served
by the Company's customers, especially in the construction industry.
The Company's customers are shippers or consignees of dry and liquid
commodities. During fiscal 1995, 65% of the Company's shipments were dry
cement and, consequently, the Company's business is very seasonal. Dry and
liquid chemicals, fertilizers and food products account for a large portion
of the remaining commodities.
Operating expenses decreased by approximately $895,000 or 6.1% in the
current quarter and decreased by $586,000 or 1.3% for the nine months
ended year to date compared to the same periods of 1994. The change in
operating expenses is result of: (1) the decrease in volume; (2) the
increase in depreciation expense as a result of acquiring new tractors and
trailers; and (3) the decrease in insurance and workers' compensation
expense as the Company continues to experience a decline in accidents and
workers' compensation claims. In addition, the reduction in the number of
loads hauled by owner operators in the current year resulted in a decrease
in purchased transportation expense and an increase in salaries, wages, and
fringe benefits expense.
FINANCIAL CONDITION
Total notes payable and long-term debt was $12,588,000 and $11,711,000 at
December 23, 1995 and March 25, 1995, respectively. The $877,000 net
increase in debt is the result of $5,196,000 in new obligation to finance
the equipment additions offset by the reduction in debt resulting from
making the scheduled debt payments and a $1,230,000 reduction in the
borrowing on our revolver.
CASH FLOWS
The Company had a net increase in cash of $152,000 for the nine months
ended December 23, 1995 versus a $85,000 net decrease for the nine months
ended December 24, 1994. The Company has paid $79,000 in preferred stock
dividends for the nine months ended December 23, 1995, representing the
required dividends for three quarters.
<PAGE>
PART II - OTHER INFORMATION
Item 3. Defaults Upon Senior Securities
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - Exhibit 27. Financial Data Schedule
(b) Reports on Form 8-K - None
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SCHWERMAN TRUCKING CO.
(Registrant)
DATE: February 2, 1996 BY: Jack F. Schwerman
Jack F. Schwerman
Chairman of the Board,
President and Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Mar-25-1995
<PERIOD-START> Mar-26-1995
<PERIOD-END> Dec-23-1995
<CASH> 151649
<SECURITIES> 0
<RECEIVABLES> 4101283
<ALLOWANCES> (40000)
<INVENTORY> 1063864
<CURRENT-ASSETS> 6582100
<PP&E> 54367542
<DEPRECIATION> (33876393)
<TOTAL-ASSETS> 29372647
<CURRENT-LIABILITIES> 8317079
<BONDS> 9527411
<COMMON> 422089
0
1497470
<OTHER-SE> 6824475
<TOTAL-LIABILITY-AND-EQUITY> 29372647
<SALES> 46970671
<TOTAL-REVENUES> 46970671
<CGS> 0
<TOTAL-COSTS> 43602139
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 976152
<INCOME-PRETAX> 2392380
<INCOME-TAX> 909000
<INCOME-CONTINUING> 1483380
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1483380
<EPS-PRIMARY> 3.33
<EPS-DILUTED> 3.33
</TABLE>
