<PAGE>
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999
Commission file number 1-11862
INTERPOOL, INC.
(Exact name of registrant as specified in the charter)
Delaware 13-3467669
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
211 College Road East, Princeton, New Jersey 08540
(Address of principal executive office) (Zip Code)
(609) 452-8900
(Registrant's telephone number including area code)
As of August 13, 1999, 27,579,952 shares of common stock, $.001 par value were
outstanding.
Indicate by check [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 for the past 90 days Yes [check mark] No
<PAGE>
INTERPOOL, INC. AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
Page No.
<S> <C>
Part I - Financial Information:
Introduction to Financial Statements 3
Condensed Consolidated Balance Sheets
June 30, 1999 and December 31, 1998 4
Condensed Consolidated Statements of Income
For the Three Months and Six Months ended June 30, 1999 and 1998 5
Condensed Consolidated Statements of Cash Flows
For the Six Months ended June 30, 1999 and 1998 6
Condensed Consolidated Statements of Stockholders' Equity
For the Year Ended December 31, 1998 and the Six Months ended June 30, 1999 7
Notes to Condensed Consolidated Financial Statements 8 - 11
Management's Discussion and Analysis of
Financial Condition and Results of Operations 12 - 15
Part II - Other Information:
Item 6: Exhibits and Reports on Form 8-K 16
Signatures 17
Exhibits 18
</TABLE>
2
<PAGE>
PART I - FINANCIAL INFORMATION
INTERPOOL, INC. AND SUBSIDIARIES
FINANCIAL STATEMENTS
The condensed financial statements of Interpool, Inc. and Subsidiaries
(the "Company") included herein have been prepared by the registrant, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations, although the Registrant believes that the disclosures are adequate
to make the information presented not misleading. It is suggested that these
condensed financial statements be read in conjunction with the financial
statements and the notes thereto included in the Company's latest Annual Report
on Form 10-K. These condensed financial statements reflect, in the opinion of
management, all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the results for the interim periods. The results of
operations for such interim periods are not necessarily indicative of the
results for the full year.
3
<PAGE>
INTERPOOL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
---- ----
ASSETS (Unaudited)
<S> <C> <C>
CASH AND SHORT-TERM INVESTMENTS $140,265 $107,226
MARKETABLE SECURITIES 1,143 5,072
ACCOUNTS AND NOTES RECEIVABLE, less allowance of $8,677 and
$4,632, respectively 32,896 32,746
NET INVESTMENT IN DIRECT FINANCING LEASES 101,165 356,369
OTHER RECEIVABLES 54,357 56,758
LEASING EQUIPMENT, at cost 984,094 905,173
Less - Accumulated depreciation and amortization (195,687) (169,079)
---------- ----------
LEASING EQUIPMENT, net 788,407 736,094
---------- ----------
OTHER ASSETS 116,939 67,969
---------- ----------
TOTAL ASSETS $1,235,172 $1,362,234
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $30,238 $50,098
INCOME TAXES 20,007 19,609
DEFERRED INCOME 899 1,531
DEBT AND CAPITAL LEASE OBLIGATIONS:
Due within one year 84,786 77,776
Due after one year 727,288 854,381
---------- ----------
812,074 932,157
---------- ----------
COMPANY-OBLIGATED MANDATORILY REDEEMABLE PREFERRED SECURITIES IN SUBSIDIARY
GRANTOR TRUSTS (holding solely junior Subordinated Deferrable interest
debentures of the Company) (75,000 shares 9-7/8% Capital Securities
Outstanding, liquidation preference $75,000) 75,000 75,000
MINORITY INTEREST IN EQUITY OF SUBSIDIARIES 681 624
STOCKHOLDERS' EQUITY:
Preferred stock, par value $.001 per share; 1,000,000 authorized, none
issued --- ---
Common stock, par value $.001 per share; 100,000,000 shares authorized,
27,579,952 outstanding at June 30, 1999 and 27,566,452 outstanding at
December 31, 1998 28 28
Additional paid-in capital 124,184 124,046
Retained earnings 172,052 159,138
Accumulated other comprehensive income 9 3
---------- ----------
Total stockholders' equity 296,273 283,215
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,235,172 $1,362,234
========== ==========
</TABLE>
The accompanying notes to condensed consolidated financial statements are an
integral part of these balance sheets.
4
<PAGE>
INTERPOOL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES $44,154 $44,506 $100,725 $87,338
COST AND EXPENSES:
Lease operating and administrative expenses 11,634 10,451 30,523 21,370
Depreciation and amortization of leasing equipment 12,872 10,349 25,551 20,076
Other (income)/expense, net 438 (113) 834 (331)
Interest expense, net 12,634 12,845 27,485 26,039
------ ------ ------ ------
37,578 33,532 84,393 67,154
------ ------ ------ ------
Income before provision for income taxes 6,576 10,974 16,332 20,184
Provision for income taxes 850 1,600 1,350 2,700
--- ----- ----- -----
NET INCOME $5,726 $9,374 $14,982 $17,484
====== ====== ======= =======
Net income per share:
Basic $0.21 $0.34 $0.54 $0.63
===== ===== ===== =====
Diluted $0.20 $0.33 $0.52 $0.61
===== ===== ===== =====
WEIGHTED AVERAGE SHARES OUTSTANDING (in thousands):
Basic 27,575 27,561 27,571 27,556
====== ====== ====== ======
Diluted 28,621 28,629 28,737 28,569
====== ====== ====== ======
</TABLE>
The accompanying notes to condensed consolidated financial statements are
an integral part of these statements.
5
<PAGE>
INTERPOOL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1999 1998
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $14,982 $17,484
Adjustments to reconcile net income to net cash provided by operating activities --
Depreciation and amortization 26,436 20,970
Loss (gain) on sale of leasing equipment 515 (107)
Collections on net investment in direct financing leases 46,149 60,689
Income recognized on direct financing leases (11,146) (17,806)
Provision for uncollectible accounts 5,275 1,020
Gain on securitized lease receivables (7,942) ---
Changes in assets and liabilities -
Accounts and notes receivable (5,270) (2,471)
Other receivables 2,401 1,852
Other assets and non-cash transactions 9,461 (7,794)
Accounts payable and accrued expenses (3,013) 1,222
Income taxes payable 389 2,937
Deferred income (632) (493)
Minority interest in equity of subsidiaries 57 25
--------- --------
Net cash provided by operating activities 77,662 77,528
--------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of leasing equipment (75,048) (56,286)
Proceeds from dispositions of leasing equipment 9,241 2,472
Investment in loan receivable --- (5,698)
Investment in direct financing leases (26,362) (49,692)
Investment in and advances to unconsolidated subsidiary (6,625) (46,476)
Changes in marketable securities and other investing activities 3,953 5,223
Reduction in accrued equipment purchases (16,856) ---
--------- --------
Net cash used for investing activities (111,697) (150,457)
--------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt 24,548 121,423
Payment of long-term debt and capital lease obligations (46,450) (33,402)
Borrowings of revolving credit lines 58,056 186,735
Repayment of revolving credit lines (156,237) (201,221)
Proceeds from issuance of common stock 138 ---
Proceeds from securitized lease receivables 189,087 ---
Dividends paid (2,068) (2,066)
--------- --------
Net cash provided by financing activities 67,074 71,469
--------- --------
Net increase (decrease) in cash and short-term investments 33,039 (1,460)
CASH AND SHORT-TERM INVESTMENTS, beginning of period 107,226 30,402
--------- --------
CASH AND SHORT-TERM INVESTMENTS, end of period $ 140,265 $ 28,942
========= ========
</TABLE>
The accompanying notes to condensed consolidated financial statements are
an integral part of these statements.
6
<PAGE>
INTERPOOL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEAR ENDED DECEMBER 31, 1998 AND SIX MONTHS ENDED JUNE 30, 1999
(Dollars and shares in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Preferred Stock Common Stock Accumulated
--------------- -------------- Additional Other
Par Par Paid-in Retained Comprehensive Comprehensive
Shares Value Shares Value Capital Earnings Income Income
------ ----- ------ ----- ------- -------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1997 0 $0 27,552 $28 $124,046 $125,657 $715
Net income --- --- --- --- --- 37,614 --- 37,614
Other comprehensive loss --- --- --- --- --- --- (712) (712)
-------
Comprehensive Income $36,902
=======
Shares issued on exercise of
Stock option --- --- 37 --- 363 --- ---
Shares surrendered in
Satisfaction of stock option
Purchase price --- --- (23) --- (363) --- ---
Cash dividends declared:
Common stock --- --- --- --- --- (4,133) ---
----- ----- ------ ----- -------- -------- -----
Balance, December 31, 1998 0 $0 27,566 $28 $124,046 $159,138 $3
Net income 14,982 $14,982
Other comprehensive income 6 6
-------
Comprehensive Income $14,988
=======
Shares issued on exercise of
Stock option 14 138
Cash dividends declared:
Common stock (2,068)
----- ----- ------ ----- -------- -------- -----
Balance, June 30, 1999 0 $0 27,580 $28 $124,184 $172,052 $9
===== ===== ====== ===== ======== ======== =====
</TABLE>
The accompanying notes to condensed consolidated financial statements
are an integral part of these statements.
7
<PAGE>
INTERPOOL, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share amounts)
(Unaudited)
Note 1 -- Nature of operations and accounting policies:
A. Nature of operations:
The Company and its subsidiaries conduct business principally in a
single industry, the leasing of intermodal dry freight standard containers,
chassis and other transportation related equipment. Within this single industry,
the Company has two reportable segments: container leasing and domestic
intermodal equipment. The container leasing segment specializes in the leasing
of intermodal dry freight standard containers, while the domestic intermodal
equipment segment specializes in the leasing of intermodal container chassis and
other equipment, namely freight rail cars and intermodal trailers. The Company
leases its containers principally to international container shipping lines
located throughout the world. The customers for the Company's chassis are a
large number of domestic companies, many of which are domestic subsidiaries or
branches of international shipping lines. Equipment is purchased directly or
acquired through conditional sales contracts and lease agreements, many of which
qualify as capital leases.
The Company's accounting records are maintained in United States
dollars and the consolidated financial statements are prepared in accordance
with accounting principles generally accepted in the United States.
B. Basis of consolidation:
The consolidated financial statements include the accounts of the
Company and subsidiaries more than 50% owned. All significant intercompany
transactions have been eliminated.
C. Net income per share:
Basic net income per share is computed by deducting preferred dividends
from net income to arrive at income attributable to common stockholders. This
amount is then divided by the weighted average number of shares outstanding
during the period. Diluted income per share reflects the potential dilution that
could occur if securities or other contracts to issue common stock were
exercised or converted into common stock. The dilutive effect of stock options
have been added to the weighted shares outstanding and interest expense net of
tax effect on the notes has been added to net income in the diluted earnings per
share computation.
A reconciliation of weighted average common shares outstanding to
weighted average common shares outstanding assuming dilution follows:
<TABLE>
<CAPTION>
(in thousands)
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Average common shares outstanding 27,575 27,561 27,571 27,556
Common shares issuable (1) 1,046 1,068 1,166 1,013
Average common shares outstanding assuming dilution 28,621 28,629 28,737 28,569
</TABLE>
(1) Issuable under stock option plans.
8
<PAGE>
(Dollars in thousands, except per share amounts)
D. Comprehensive income:
The tax effect of comprehensive income is as follows:
<TABLE>
<CAPTION>
Before-Tax Tax Net of Tax
Amount Effect Amount
---------- ------ ----------
<S> <C> <C> <C>
Six Months Ended June 30, 1999
Unrealized gains (losses) on securities -
Unrealized holding gains (losses) arising during period $(121) $ 42 $(79)
Less: Reclassification adjustments for gains (losses)
Realized in net income (130) 45 (85)
----- ---- ----
Unrealized gain (loss) on marketable securities $9 $(3) $6
===== ==== ====
Six Months Ended June 30, 1998
Unrealized gains (losses) on securities -
Unrealized holding gains (losses) arising during period $1,062 $(318) $744
Less: Reclassification adjustments for gains (losses)
Realized in net income 1,358 (407) 951
------ ----- -----
Unrealized gain (loss) on marketable securities $ (296) $ 89 $(207)
====== ===== =====
</TABLE>
Note 2 -- Cash flow information:
For the six months ended June 30, 1999 and 1998, cash paid for interest
was approximately $32,659 and $29,618, respectively. Cash paid for income taxes
was approximately $1,863 and $823, respectively.
Note 3 -- Segment and geographic data:
The Company has two reportable segments: container leasing and domestic
intermodal equipment. The container leasing segment specializes in the leasing
of intermodal dry freight standard containers, while the domestic intermodal
equipment segment specializes in the leasing of intermodal container chassis and
other equipment, namely freight rail cars and intermodal trailers. Segments
below the quantitative threshold are included in other and specialize in the
leasing of microcomputers and other related equipment.
The accounting policies of the segments are the same as those described
in Note 1. The Company evaluates performance based on profit or loss from
operations before income taxes and extraordinary items. The Company's reportable
segments are strategic business units that offer different products and
services.
Segment Information:
<TABLE>
<CAPTION>
Domestic
Container Intermodal
Six Months ended 1999: Leasing Equipment Other Totals
---------------------- --------- ---------- ----- ------
<S> <C> <C> <C> <C>
Revenues from external customers $51,177 $44,840 $4,708 $100,725
Lease operating and administrative expenses 9,612 19,524 1,387 30,523
Depreciation and amortization 12,724 10,762 2,065 25,551
Other income/(expense), net (984) 180 (30) (834)
Interest income 2,042 3,420 --- 5,462
Interest expense 12,668 19,510 769 32,947
Income before taxes and extraordinary item $17,231 $(1,356) $457 $16,332
Net investment in DFL's $51,098 $28,196 $21,871 $101,165
Leasing equipment, net 384,260 398,962 5,185 788,407
Equipment purchases 48,973 43,337 9,100 101,410
Total segment assets $569,926 $637,869 $27,377 $1,235,172
</TABLE>
9
<PAGE>
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
Domestic
Container Intermodal
Six Months ended 1998: Leasing Equipment Other Totals
---------------------- --------- ---------- ----- ------
<S> <C> <C> <C> <C>
Revenues from external customers $44,368 $39,414 $3,556 $87,338
Lease operating and administrative expenses 4,767 15,592 1,011 21,370
Depreciation and amortization 10,093 8,181 1,802 20,076
Other income/(expense), net (41) 350 22 331
Interest income 2,491 2,553 --- 5,044
Interest expense 15,405 15,050 628 31,083
Income before taxes and extraordinary item $16,553 $3,494 $137 $20,184
Net investment in DFL's $323,825 $30,277 $14,398 $368,500
Leasing equipment, net 298,507 338,092 7,810 644,409
Equipment purchases 47,538 47,512 10,928 105,978
Total segment assets $655,188 $528,081 $23,988 $1,207,257
</TABLE>
The Company's shipping line customers utilize international containers in world
trade over many varied and changing trade routes. In addition, most large
shipping lines have many offices in various countries involved in container
operations. The Company's revenue from international containers is earned while
the containers are used in service carrying cargo around the world, while
certain other equipment is utilized in the United States. Accordingly, the
information about the business of the Company by geographic area is derived from
either international sources or from United States sources. Such presentation is
consistent with industry practice.
Geographic Information:
1999 1998
---- ----
REVENUES:
United States $ 57,544 $ 44,603
International 43,181 42,735
---------- ----------
$100,725 $87,338
========== ==========
ASSETS:
United States 665,246 552,069
International 569,926 655,188
---------- ----------
$1,235,172 $1,207,257
========== ==========
Note 4 -- Other contingencies and commitments:
At June 30, 1999, the Company had outstanding purchase commitments for
equipment of approximately $100.0 million.
Under certain of the Company's leasing agreements, the Company, as
lessee, may be obligated to indemnify the lessor for loss, recapture or
disallowance of certain tax benefits arising from the lessor's ownership of the
equipment.
The Company is engaged in various legal proceedings from time to time
incidental to the conduct of its business. In the opinion of management, the
Company is adequately insured against the claims relating to such proceedings,
and any ultimate liability arising out of such proceedings will not have a
material adverse effect on the financial condition or results of operations of
the Company.
10
<PAGE>
(Dollars in thousands, except per share amounts)
Note 5 -- Lease securitization program:
On March 30, 1999, the Company established a securitization facility of
$250.0 million. This program provides the Company with a lower cost of capital
for its finance lease business and access to an additional source of funding. On
March 31, 1999, the Company securitized approximately $235.5 million of lease
receivables through utilization of $190.0 million of this facility and recorded
a pre-tax gain of $7.9 million which is included in revenues; other costs and
associated tax effect brought the net gain to $5.5 million. A portion of the
gain has been deferred to record an estimate of the losses under recourse
provisions for the lease receivables securitized. The estimate for losses was
based on the Company's historical loss experience with such default rate
approximating 1.5% of contractual payments.
Included in other assets at June 30, 1999, is approximately $42.6
million of retained interests in the securitized lease receivables. The fair
value of such retained interests were calculated using a fair market discount
rate of approximately 11%.
11
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
General
The Company generates revenues through leasing transportation
equipment, primarily intermodal dry freight standard containers and container
chassis. Most of the Company's revenues are derived from payments under
operating leases and income earned under finance leases, under which the lessee
has the right to purchase the equipment at the end of the lease term. For the
six months ended June 30, 1999 and 1998 revenues from direct financing leases
were $11.1 million (12% of leasing revenues) and $17.8 million (20% of leasing
revenues), respectively. For the three months ended June 30, 1999 and 1998
revenues from direct financing leases were $3.1 million (7% of leasing revenues)
and $8.8 million (20% of leasing revenues), respectively.
Three Months Ended June 30, 1999 compared to Three Months Ended June 30, 1998
Revenues
The Company's revenues decreased to $44.2 million for the three months
ended June 30, 1999, from $44.5 million in the three months ended June 30, 1998,
a decrease of $.3 million or 1%. The decrease was primarily due to a $5.5
million decrease in finance lease revenues as a result of the March 31, 1999
securitization of approximately $235.5 million of lease receivables, partially
offset by increased operating lease revenues generated by an expanded container
and chassis fleet. Utilization rates of the container and chassis operating
lease fleet at June 30, 1999 were 97% and 92% respectively, and at June 30, 1998
were 97% and 96%, respectively.
Lease Operating and Administrative Expenses
The Company's lease operating and administrative expenses increased to
$11.6 million for the three months ended June 30, 1999 from $10.5 million in the
three months ended June 30, 1998, an increase of $1.1 million. The increase was
primarily due to higher operating and administrative costs resulting from
expanded operations generating increased commission, insurance and salary
expense.
Depreciation and Amortization of Leasing Equipment
The Company's depreciation and amortization expenses increased to $12.9
million in the three months ended June 30, 1999 from $10.3 million in the three
months ended June 30, 1998, an increase of $2.6 million. The increase was due to
an increased fleet size.
Other (Income)/Expense, Net
The decrease in other (income)/expense, net was due to a decrease in
the Company's income from unconsolidated subsidiaries of $.1 million.
Additionally, the Company's net loss on sale of leasing equipment increased $.5
million in the three months ended June 30, 1999.
Interest Expense, Net
The Company's net interest expense decreased to $12.6 million in the
three months ended June 30, 1999 from $12.8 million in the three months ended
June 30, 1998, a decrease of $.2 million. The decrease in net interest expense
was primarily due to reduced borrowing costs resulting in interest expense
savings of $.3 million, partially offset by increased borrowings to fund capital
expenditures resulting in incremental interest expense of $.1 million.
Provision for Income Taxes
The Company's provision for income taxes decreased to $.9 million from
$1.6 million primarily due to a lower effective tax rate resulting from greater
income contribution from the international container division.
Net Income
As a result of the factors described above, the Company's net income
was $5.7 million in the three months ended June 30, 1999 versus net income of
$9.4 million in the three months ended June 30, 1998.
12
<PAGE>
Six Months Ended June 30, 1999 compared to Six Months Ended June 30, 1998
Revenues
The Company's revenues increased to $100.7 million for the six months
ended June 30, 1999, from $87.3 million in the six months ended June 30, 1998,
an increase of $13.4 million or 15%. The increase was primarily due to increased
operating lease revenues generated by an expanded container and chassis fleet,
as well as a gain of $7.9 million recognized from the securitization completed
during the three months ended March 31, 1999, partially offset by a decrease in
finance lease revenues of $5.5 million during the second quarter of 1999 as a
result of the above-mentioned securitization.
Lease Operating and Administrative Expenses
The Company's lease operating and administrative expenses increased to
$30.5 million for the six months ended June 30, 1999 from $21.4 million in the
six months ended June 30, 1998, an increase of $9.1 million. The increase was
primarily due to additional bad debt reserves for specific losses incurred
during the three months ended March 31, 1999, as well as higher operating and
administrative costs resulting from expanded operations generating increased
commission, insurance and salary expense.
Depreciation and Amortization of Leasing Equipment
The Company's depreciation and amortization expenses increased to $25.6
million in the six months ended June 30, 1999 from $20.1 million in the six
months ended June 30, 1998, an increase of $5.5 million. The increase was due to
an increased fleet size.
Other (Income)/Expense, Net
The decrease in other (income)/expense, net was due to a decrease in
the Company's income from unconsolidated subsidiaries of $.6 million, which
included a $1.0 million write down of an investment in an unconsolidated
subsidiary of the Company. Additionally the Company's net loss on sale of
leasing equipment increased $.6 million in the six months ended June 30, 1999.
Interest Expense, Net
The Company's net interest expense increased to $27.5 million in the
six months ended June 30, 1999 from $26.0 million in the six months ended June
30, 1998, an increase of $1.5 million. The increase in net interest expense was
due to increased interest expense of $1.9, partially offset by increased
investment income of $.4 million. The increase in interest expense was primarily
due to increased borrowings to fund capital expenditures resulting in
incremental interest expense of $2.9 million, partially offset by reduced
borrowing costs resulting in interest expense savings of $1.0 million.
Provision for Income Taxes
The Company's provision for income taxes decreased to $1.4 million from
$2.7 million primarily due to a lower effective tax rate resulting from greater
income contribution from the international container division.
Net Income
As a result of the factors described above, the Company's net income
was $15.0 million in the six months ended June 30, 1999 versus net income of
$17.5 million in the six months ended June 30, 1998.
Liquidity and Capital Resources
The Company uses funds from various sources to finance the acquisition
of equipment for lease to customers. The primary funding sources are cash
provided by operations, borrowings, generally from banks, securitization of
lease receivables, the issuance of capital lease obligations and the sale of the
Company's debt securities. In addition, the Company generates cash from the sale
of equipment being retired from the Company's fleet. In general, the Company
seeks to meet debt service requirements from the leasing revenue generated by
its equipment.
The Company generated cash flow from operations of $77.7 million and
$77.5 million in the first six months of 1999 and 1998, respectively, and net
cash provided by financing activities was $67.1 million and $71.5 million for
the first six months of 1999 and 1998, respectively. The Company has purchased
the following amounts of equipment: $101.4 million for the six months ended June
30, 1999 and $106.0 million for the six months ended June 30, 1998.
13
<PAGE>
On March 30, 1999, the Company established a securitization facility of
$250.0 million. This program provides the Company with a lower cost of capital
for its finance lease business and access to an additional source of funding. At
June 30, 1999, $190.0 million of this facility was utilized. Subsequent to the
securitization, the Company no longer recognizes revenue from the lease
receivables that have been securitized.
The Company has a $215.0 million revolving credit facility with a group
of commercial banks; on June 30, 1999, $30.0 million was outstanding. The term
of this facility extends until May 31, 2000 (unless the lender elects to renew
the facility) at which time a maximum of 10% of the amount then outstanding
becomes due, with the remainder becoming payable in equal monthly installments
over a five year period. In addition, as of June 30, 1999, the Company had
available lines of credit of $71.0 million under various facilities, under which
$53.0 million was outstanding. Interest rates under these facilities ranged from
5.4% to 6.2%. At June 30, 1999, the Company had total debt outstanding of $812.1
million. Subsequent to June 30, 1999 the Company has continued to incur and
repay debt obligations in connection with financing its equipment leasing
activities.
As of June 30, 1999, commitments for capital expenditures totaled
approximately $100.0 million. The Company expects to fund such capital
expenditures through some combination of cash flow from the Company's
operations, borrowings under its available credit facilities and additional
funds raised through the sale of its debt securities in the private and/or
public markets.
The Company is currently exploring the separation of its Microtech and
Poolstat businesses into a separate entity under the Microtech name, and a
possible spin-off of Microtech to Interpool shareholders. Because a spin-off of
Microtech and Poolstat would be subject to various conditions, there can be no
assurance it will be completed.
The Company believes that cash generated by continuing operations,
together with existing short-term credit facilities, the issuance of debt
securities in the appropriate markets and the portion of the proceeds remaining
from recent debt security sales will be sufficient to finance the Company's
working capital needs for its existing business, planned capital expenditures,
investments and expected debt repayments over the next twelve months. The
Company anticipates that long-term financing will continue to be available for
the purchase of equipment to expand its business in the future. In addition,
from time to time, the Company explores new sources of capital both at the
parent and subsidiary levels.
In June 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 133, Accounting for Derivative Instruments
and Hedging Activities. The Statement establishes accounting and reporting
standards requiring that every derivative instrument (including certain
derivative instruments embedded in other contracts) be recorded in the balance
sheet as either an asset or liability measured at its fair value. The Statement
requires that changes in the derivative's fair value be recognized currently in
earnings unless specific hedge accounting criteria are met. Special accounting
for qualifying hedges allows a derivative's gain and losses to offset related
results on the hedge item in the income statement, and requires that a company
must formally document, designate, and assess the effectiveness of transactions
that receive hedge accounting.
Statement 133 is effective for fiscal years beginning after June 15,
2000. A company may also implement the Statement as of the beginning of any
fiscal quarter after issuance (that is, fiscal quarters beginning June 16, 1998
and thereafter). Statement 133 cannot be applied retroactively. Statement 133
must be applied to (a) derivative instruments and (b) certain derivative
instruments embedded in hybrid contracts that were issued, acquired, or
substantively modified after December 31, 1997 (and, at the company's election
before January 1, 1998). The Company has not yet quantified the impacts of
adopting Statement 133 on its financial statements and has not determined the
timing or method of our adoption of Statement 133. However, the Statement could
increase volatility in earnings and other comprehensive income.
14
<PAGE>
Year 2000
The Company has undertaken a program to address the issues associated with the
onset of the calendar year 2000 ("Y2K"). During 1998, a working group comprised
of senior management and members from potentially affected departments formed to
determine the full scope and related costs of Y2K issues to insure that the
Company's systems continue to meet its internal needs and those of its
customers. The Y2K Working Group meets periodically and reports its findings and
plans to the Company's Board of Directors.
The assessment phase of the Y2K project was completed on August 31, 1998. All
internal systems, hardware, software, and embedded clocks and calendars were
evaluated for Y2K compliance. Software source code for in-house developed
systems was analyzed to determine program cognizance of Y2K. The analysis
resulted in the need to upgrade or replace three of the Company's four software
systems: the fleet management system, the accounting system for accounts payable
and general ledger, and the overseas data input program. The fleet management
system was upgraded to achieve Y2K compliance on June 30, 1999. The accounting
system was replaced with a verified Y2K compliant commercial package on April 1,
1999. The overseas data input program was completed on July 7, 1999. The fourth
program, PoolStattm, has been developed over the past two years using Y2K coding
practices. Testing of PoolStattm was carried out against software developed
in-house, resulting in demonstrated compliance.
Testing resulted in demonstrated compliance of all data servers, however, it
also indicated the need to replace a specified number of personal computers of a
specific age and model. All non Y2K compliant personal computers were replaced
as of May 15, 1999. Testing was also carried out on internal systems with
embedded clocks and calendars, including the telephone PBX system. The result
also indicated that the PBX in both headquarters needed replacing. The New York
office PBX was replaced on December 18, 1998 and the Princeton office PBX was
replaced on July 9, 1999.
The budget for the Y2K project is $210,000. The 1998 allocation of $75,000
included time and tools associated with assessment, and the purchase of a
replacement accounting system, and a new PBX phone system for the Company's New
York office. The 1999 budget of $125,000 was primarily associated with the
purchase of new desktop computer systems, a new telephone PBX phone system for
the Company's Princeton office, and the cost of in-house labor for modification
of date portions of internal software. The budget for the year 2000 is $10,000
and covers additional documentation work and cosmetic work for display of dates
as either "2000' or "00" as users request. The Company's expenditures to date
have been on target. In addition, many of the hardware purchases covered under
the Y2K budget were slated to occur regardless of the Y2K issue.
The Company recognizes that there are additional Y2K factors related to its
dependence on other business partners, including customers, suppliers, and
service providers. Because our business partners' Y2K projects are beyond the
Company's control, it is necessary to determine the level of risk currently
posed by these dependencies. The Company developed a questionnaire requesting
Y2K project information, which was sent to over 400 business partners, including
100% of all customers and all key suppliers and service providers. To date
approximately 40% of suppliers have responded and approximately 25% of customers
have responded. The returned questionnaires are being complied. Updated requests
and second notices have been sent out.
Potential risk from Y2K failures by outside companies can be categorized by type
of business partner. Risk from customer failure is two fold: potential inability
to pay invoices in a timely manner, and potential loss of effective tracking of
the Company's assets on lease and in their possession. There is some concern
that Asian headquartered shipping lines have been focussing on the effects of
the "Asian crisis" and therefore may not be giving the Y2K problem sufficient
attention. The Y2K Working Group will be paying special attention to the
questionnaire responses from this customer segment. Key suppliers are those
which would require significant effort to replace if the flow of goods were
affected. Particular companies of concern are manufacturers and re-manufacturers
of chassis, and manufacturers of containers. Two container manufacturers account
for over 40% of new container purchases. Alternate sources will be examined as
part of a contingency plan. Service providers of primary concern are banks and
financial institutions with which the Company has lines of credit.
The responses to the questionnaire will help determine the extent to which
contingency plans must be made to deal with possible interruptions in the flow
of goods, services and/or funds. The contingency planning process requires
distribution of an extra set of questionnaires due to the lack of information
provided by key suppliers and customers. The contingency plan is in process
while awaiting these updated questionnaires. The Company plans to have
sufficient funds available that would allow it to continue to operate if
customers deviate from their scheduled payment obligations as a result of the
Y2K situation. The Company also plans on sending out requests for updated
questionnaires during the last half of 1999 to companies who have disclosed a
high degree of risk, and who could significantly impact the Company's business.
At that time, the Company, if necessary, would being implementation of its
contingency plan.
15
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
On May 26, 1999, the Company's Annual Meeting of Stockholders was held
in New York, New York for the purposes of electing three Class III
directors for a three year term and to ratify the appointment of Arthur
Andersen LLP as the Company's independent accountants for the 1999
fiscal year. Each of the director nominees, Martin Tuchman, Arthur L.
Burns and Peter D. Halstead were elected and the appointment of Arthur
Andersen LLP was ratified by an affirmative vote of a majority of the
common shares of the Company.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit 99: (1) Press Release dated May 12, 1999
(incorporated by reference to the
Company's Form 10-Q for the quarter
ended March 31, 1999
(2) Press Release dated May 19, 1999
(3) Press Release dated June 21, 1999
(4) Press Release dated August 9, 1999
(b) Reports on Form 8-K:
None
16
<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.
INTERPOOL, INC.
Dated: August 13, 1999 \s\Martin Tuchman
--------------------------------
Martin Tuchman
Chief Executive Officer
Dated: August 13, 1999 \s\William Geoghan
--------------------------------
William Geoghan
Senior Vice President
17
<PAGE>
INDEX TO EXHIBITS
Filed with Interpool, Inc.
Report on Form 10-Q for the Quarter Ended June 30, 1999
Exhibit No.
99: (1) Press Release dated May 12, 1999 (incorporated by
reference to the Company's Form 10-Q for the quarter
ended March 31, 1999
(2) Press Release dated May 19, 1999
(3) Press Release dated June 21, 1999
(4) Press Release dated August 9, 1999
18
<PAGE>
FOR: INTERPOOL, INC.
FOR IMMEDIATE RELEASE
CONTACT: Raoul J. Witteveen
President, Chief Operating Officer
and Chief Financial Officer
(212) 916-3261
Morgen-Walke Associates
Gordon McCoun, Jennifer Angell
Media contact: Merridith Ingram
(212) 850-5600
INTERPOOL, INC. REPORTS 1ST QUARTER INCOME PER DILUTED SHARE OF
$0.32 AS COMPARED WITH $0.28 FOR PRIOR YEAR
-------------------------------------------
PRINCETON, NJ, MAY 12, 1999 -- Interpool, Inc. (NYSE:IPX) reported today that
its 1999 first quarter net income was $9,256,000, or $0.32 per diluted share, as
compared with net income of $8,110,000, or $0.28 per diluted share, for the same
period in 1998. Revenues during the first quarter of 1999 were $56,571,000, up
32% from $42,832,000 in the first quarter of 1998.
At the end of the first quarter, the company's container fleet was approximately
500,000 TEUs (twenty-foot-equivalent units), with container utilization at 98%,
while the chassis fleet has grown to approximately 78,000 units, with chassis
utilization at 92%.
Martin Tuchman, Chairman and Chief Executive Officer, commented: "Our first
quarter results reflect the Company's focus on the expansion of our intermodal
equipment fleet, and our container and chassis leasing businesses are operating
at close to full capacity. We continue to place substantial emphasis on our
chassis management segment; and while still performing below expectations, we
expect to begin to see incremental revenue growth from this business during the
second half of 1999."
- MORE -
19
<PAGE>
Interpool 1Q99 5/12/99 Page 2
Mr. Tuchman continued: "We recently completed a securitization facility of $250
million with First Union Capital Markets and BancBoston Robertson Stephens. This
type of program not only provides Interpool with a lower cost of capital for its
finance lease business and access to an additional source of funding, but also
allows for the most efficient use of the Company's equity."
Interpool, originally founded in 1968, is one of the world's leading lessors of
cargo containers used in international trade and is the second largest lessor of
intermodal container chassis in the United States. Interpool leases its
containers and chassis to over 200 customers, including nearly all of the
world's 20 largest international container shipping lines.
This Press Release contains certain forward-looking statements
regarding future circumstances. These forward-looking statements are
subject to risks and uncertainties that could cause actual results to
differ materially from those contemplated in such forward-looking
statements, including in particular the risks and uncertainties
described in the company's SEC filings. The company undertakes no
obligation to publicly release any revisions to these forward-looking
statements to reflect events or circumstances after the date hereof.
Note: This press release and other press releases and information can be viewed
at the Company's website at www.interpool.com.
------------------
- TABLE FOLLOWS -
20
<PAGE>
INTERPOOL, INC.
CONSOLIDATED STATEMENT OF INCOME
(In thousands, except amounts per share)
(Unaudited)
THREE MONTHS
ENDED
MARCH 31,
1999 1998
---- ----
REVENUES $56,571 $42,832
LEASE OPERATING AND ADMINISTRATIVE EXPENSES 18,889 10,919
DEPRECIATION AND AMORTIZATION OF LEASING EQUIPMENT 12,679 9,727
OTHER (INCOME)/EXPENSE, NET 396 (218)
------- -------
EARNINGS BEFORE INTEREST AND TAXES 24,607 22,404
INTEREST EXPENSE, NET 14,851 13,194
------- -------
INCOME BEFORE TAXES 9,756 9,210
PROVISION FOR INCOME TAXES 500 1,100
------- -------
NET INCOME $ 9,256 $ 8,110
======= =======
NET INCOME PER SHARE:
BASIC $0.34 $0.29
DILUTED $0.32 $0.28
WEIGHTED AVERAGE SHARES OUTSTANDING:
BASIC 27,566 27,552
DILUTED 28,853 28,510
21
<PAGE>
FOR: INTERPOOL, INC.
FOR IMMEDIATE RELEASE
CONTACT: Raoul J. Witteveen
President, Chief Operating Officer
and Chief Financial Officer
(212) 916-3261
Morgen-Walke Associates
Gordon McCoun, Jennifer Angell
Media contact: Merridith Ingram
(212) 850-5600
INTERPOOL HONORED AS PART OF THE INC./CISCO
GROWING WITH TECHNOLOGY AWARDS PROGRAM
Awards Recognize Small and Medium-Size Businesses that are Networked for Growth
Princeton, NJ, May 19, 1999 -- Interpool, Inc. (NYSE:IPX) today announced that
it has been honored with the Grand prize in the category of Fully Established
companies, as part of the Inc./Cisco Growing with Technology awards program.
Sponsored by Cisco Systems, Inc., the worldwide leader in networking for the
Internet, in conjunction with Inc., the magazine for growing companies, the 1999
Growing with Technology Awards recognize small and mid-size business that
demonstrate the innovative use of networking and the Internet can increase
profits, provide the competitive advantage and drive company growth.
Interpool, Inc., an established lessor of freight containers and the chassis
used to move these containers, was chosen for its innovative use of computer
technology to turn a relatively small company into an extremely profitable
business, capable of competing with the so-called giants in the transportation
equipment leasing industry.
Interpool will be honored at the Strategy Summit '99: Growing your Company
through Technology conference (the week of May 18), in San Francisco, CA, and
will be featured in a special section of the June 15 issue of Inc., as well as
on Inc. and Cisco's Small/Medium business web sites.
"As we move into the 21st century, Interpool will not be resting on our past
accomplishments," said Martin Tuchman, CEO and Chairman of the Board at
Interpool, Inc. "We recognize that our prime differentiating factors against our
larger counterparts is our use of cutting edge technology. Technology and
networking has helped us predict the needs of our customers giving us a
competitive advantage."
- MORE -
22
<PAGE>
INTERPOOL HONORED AS PART OF THE INC./CISCO
GROWING WITH TECHNOLOGY AWARDS PROGRAM PAGE 2
"Cisco Systems is proud to recognize Interpool with the grand prize award," said
Eugene Lee, Vice President of Marketing for Cisco's Small/Medium
line-of-business. "Interpool has demonstrated how networking technology and the
Internet have helped them create a winning business through the use of
Electronic Data Interchange allowing its customers to securely access
Interpool's databases from remote facilities around the world via the Internet."
About the Inc./Cisco Growing with Technology Awards
Interpool, Inc. was chosen by a panel of seven judges that reviewed more than
700 entries to pick 45 finalists in three company categories: Fully Established,
Start-Up, and Internet/Virtual. Grand prize winners and two runners-up were
chosen in each category. Criteria for selection was based on companies that had:
o Spiked revenues by entering new markets, introducing new products, or
reaching new prospects
o Adopted a new business model or reengineered their operations to cut costs or
spark growth
o Put new meaning into the terms customer support, customer feedback, supplier
relations, or strategic partnership
o Overcome boundaries of size, time and space
o Moved from a local or regional market into a national or international market
About Interpool, Inc.
Interpool, originally founded in 1968, is one of the world's leading lessors of
cargo containers used in international trade and is the second largest lessor of
intermodal container chassis in the United States. Interpool leases its
containers and chassis to over 200 customers, including nearly all of the
world's 20 largest international container shipping lines.
Note: This press release and other press releases and information can be viewed
at the Company's website at www.interpool.com.
------------------
# # #
23
<PAGE>
FOR: INTERPOOL, INC.
FOR IMMEDIATE RELEASE
CONTACT: Raoul J. Witteveen
President, Chief Operating Officer
and Chief Financial Officer
(212) 916-3261
Morgen-Walke Associates
Gordon McCoun, Jennifer Angell
Media contact: Merridith Ingram
(212) 850-5600
INTERPOOL, INC. TO PAY CASH DIVIDEND ON COMMON STOCK
PRINCETON, N.J., June 21, 1999 - Interpool, Inc. (NYSE: IPX) announced today
that it will pay a cash dividend of 3.75 cents per share for the second quarter
of 1999. The dividend will be payable on July 15, 1999 to shareholders of record
on July 1, 1999. The aggregate amount of the dividend is expected to be
approximately $1,034,000.00. The amount of the quarterly dividend is based on a
1999 annualized dividend rate of 15 cents per share.
Interpool, originally founded in 1968, is one of the world's leading lessors of
cargo containers used in international trade and is the second largest lessor of
intermodal container chassis in the United States. Interpool leases its
containers and chassis to over 200 customers, including nearly all of the
world's 20 largest international container shipping lines.
###
Note: This press release and other press releases and information can be viewed
at the Company's website at www.interpool.com.
------------------
24
<PAGE>
FOR: INTERPOOL, INC.
FOR IMMEDIATE RELEASE
CONTACT: Raoul J. Witteveen
President, Chief Operating Officer
and Chief Financial Officer
(212) 916-3261
Morgen-Walke Associates:
Gordon McCoun, Jennifer Angell
Media contacts: Merridith Ingram,
Heather Fox
(212) 850-5600
INTERPOOL, INC. REPORTS 2ND QUARTER NET INCOME
PER DILUTED SHARE OF $0.20 AS COMPARED WITH $0.33 FOR PRIOR YEAR
----------------------------------------------------------------
- Company to Explore Spin-off of Microtech and PoolStat -
PRINCETON, NJ, August 9, 1999 -- Interpool, Inc. (NYSE:IPX) reported today that
its 1999 second quarter net income was $5,726,000, or $0.20 per diluted share,
as compared with net income of $9,374,000, or $0.33 per diluted share, for the
same period in 1998. Revenues during the second quarter of 1999 were
$44,154,000, as compared to $44,506,000 in the second quarter of 1998.
For the first six months of 1999, net income was $14,982,000 or $0.52 per
diluted share, as compared with net income of $17,484,000, or $0.61 per diluted
share, for the same period in 1998. Revenues for the first half of 1999 were
$100,725,000, as compared to $87,338,000 in the same period last year.
Results in the recent quarter were negatively affected by the transfer of a
significant portion of the Company's finance lease portfolio under the
securitization facility in the first quarter of 1999. The sale caused a decline
in revenues from finance leases from $9.4 million in the second quarter of 1998
to $3.1 million in the recent quarter, and a decline in pretax income from $5.0
million to $0.9 million for the same periods.
- MORE -
25
<PAGE>
Interpool 2Q99 8/9/99 Page 2
Revenues and pretax income from Interpool's operating leases, which include both
containers and chassis on long-term lease, rose year over year as a result of
increases in the size of the fleets. The Company's container operating lease
fleet at the end of the second quarter was approximately 260,000 TEUs
(twenty-foot-equivalent units), up from 244,000 TEUs at the beginning of the
quarter. The chassis operating lease fleet at June 30th was 75,000, up from
72,000 in the previous quarter. Utilization of the container and chassis fleets
in the quarter were 97% and 92%, respectively.
Martin Tuchman, Chairman and Chief Executive Officer, commented: "While it is
clear that the securitization of the finance lease portfolio had a large effect
on our reported results in the second quarter, we believe the securitization
program makes strategic sense for Interpool by enabling the Company to raise
substantial funds at favorable rates. With the current tightness of credit
available for investment in the container and chassis businesses, we are very
optimistic regarding our ability to gain market share using over $400 million in
available cash and committed credit resources to acquire additional equipment
going into the market at what will be attractive rates of return."
Interpool also announced the Company's intention to explore the separation of
its Microtech and Poolstat businesses into a separate entity under the Microtech
name, and effect a spin-off of Microtech to Interpool shareholders.
Mr. Tuchman noted: "We believe the separation of Microtech would benefit
Interpool shareholders by allowing the Company to concentrate on its very
profitable core businesses of containers and chassis. In addition, the spin-off
would provide a pure-play vehicle for investors who wish to participate in the
tremendous growth opportunities we see in Poolstat's Internet-based
business-to-business chassis management operation. Poolstat's programs continue
to be well received, and have become instrumental in enabling us to establish
new customer relationships for both chassis management as well as our leasing
activities. Going forward, we will ensure that the managers of Poolstat are
incentivized to continue to drive the growth of Interpool's leasing business.
Interpool will continue to have exclusive rights to Poolstat's proprietary
software."
Because a spin-off of Microtech and Poolstat would be subject to various
conditions, there can be no assurance it will be completed.
Interpool, originally founded in 1968, is one of the world's leading lessors of
cargo containers used in international trade and is the second largest lessor of
intermodal container chassis in the United States. Interpool leases its
containers and chassis to over 200 customers, including nearly all of the
world's 20 largest international container shipping lines.
This Press Release contains certain forward-looking statements regarding future
circumstances. These forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ materially from those
contemplated in such forward-looking statements, including in particular the
risks and uncertainties described in the company's SEC filings. The company
undertakes no obligation to publicly release any revisions to these
forward-looking statements to reflect events or circumstances after the date
hereof.
Note: This press release and other press releases and information can be viewed
at the Company's website at www.interpool.com.
------------------
- TABLES FOLLOW -
26
<PAGE>
INTERPOOL, INC.
CONSOLIDATED STATEMENT OF INCOME
(In thousands, except amounts per share)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES $44,154 $44,506 $100,725 $87,338
COST AND EXPENSES:
Lease operating and administrative expenses 11,634 10,451 30,523 21,370
Depreciation and amortization of leasing equipment 12,872 10,349 25,551 20,076
Other (income)/expense, net 438 (113) 834 (331)
------- ------- -------- -------
Earnings before interest and taxes 19,210 23,819 43,817 46,223
Interest expense, net 12,634 12,845 27,485 26,039
------- ------- -------- -------
Income before taxes 6,576 10,974 16,332 20,184
Provision for income taxes 850 1,600 1,350 2,700
------- ------- -------- -------
NET INCOME $ 5,726 $ 9,374 $ 14,982 $17,484
======= ======= ======== =======
NET INCOME PER SHARE:
Basic $0.21 $0.34 $0.54 $0.63
Diluted $0.20 $0.33 $0.52 $0.61
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic 27,575 27,561 27,571 27,556
Diluted 28,621 28,629 28,737 28,569
CONSOLIDATED BALANCE SHEET
(In thousands) June 30, December 31,
(Unaudited) 1999 1998
---- ----
ASSETS
Cash and short-term investments and marketable securities $141,408 $112,298
Accounts and notes receivable, net 32,897 32,746
Net investment in direct financing leases 101,165 356,369
Other receivables, net 54,356 56,758
Revenue producing equipment, net 788,407 736,094
Other assets 116,939 67,969
---------- ----------
TOTAL ASSETS $1,235,172 $1,362,234
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts and notes receivable, net $30,238 $50,098
Income taxes 20,007 19,609
Deferred income 899 1,531
Debt and capital lease obligations 812,074 932,157
Capital securities 75,000 75,000
Minority interest 681 624
Stockholders' equity 296,273 283,215
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,235,172 $1,362,234
========== ==========
INTERPOOL, INC.
BUSINESS OPERATIONS BREAKDOWN
(In thousands)
PRETAX
REVENUES PROFIT/(LOSS)
-------------
Three Months Ended Three Months Ended
June 30, June 30,
1999 1998 1999 1998
---- ---- ---- ----
OPERATING LEASE BUSINESS $38,300 $32,736 $8,972 $7,958
FINANCE LEASE BUSINESS 3,119 9,414 893 4,979
OTHER OPERATIONS 2,600 2,050 (627) (380)
CORPORATE/INVESTMENT DIVISION 3,034 2,400 (2,661) (1,582)
</TABLE>
###
27
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (A)________
_______________________________________________________________________________
_______________________________________________________________________________
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH (B)______________________
_______________________________________________________________________________
_______________________________________________________________________________
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 140,265
<SECURITIES> 1,143
<RECEIVABLES> 41,573
<ALLOWANCES> 8,677
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 984,094
<DEPRECIATION> 195,687
<TOTAL-ASSETS> 1,235,172
<CURRENT-LIABILITIES> 116,923
<BONDS> 727,288
0
0
<COMMON> 28
<OTHER-SE> 124,184
<TOTAL-LIABILITY-AND-EQUITY> 1,235,172
<SALES> 100,725
<TOTAL-REVENUES> 100,725
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 56,908
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 27,485
<INCOME-PRETAX> 16,332
<INCOME-TAX> 1,350
<INCOME-CONTINUING> 14,982
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 14,982
<EPS-BASIC> .54
<EPS-DILUTED> .52
</TABLE>