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, 1998
Commission File No. 0-24946
KNIGHT TRANSPORTATION, INC.
(Exact name of registrant as specified in its charter)
Arizona 86-0649974
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5601 West Buckeye Road
Phoenix, Arizona
85043
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code: 602-269-2000
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
---------- ----------
The number of shares outstanding of registrant's Common Stock, par value $0.01
per share, as of August 7, 1998 was 14,948,197 shares.
<PAGE>
KNIGHT TRANSPORTATION, INC.
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page Number
<S> <C> <C>
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 1998 1
and December 31, 1997
Consolidated Statements of Income for the Three Months 3
and Six Months Ended June 30, 1998 and June 30, 1997
Consolidated Statements of Cash Flows for the Six Months 4
Ended June 30, 1998 and June 30, 1997
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition 8
and Results of Operations
Part II - OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 2. Changes in Securities 12
Item 3 Defaults Upon Senior Securities 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6 Exhibits and Reports on Form 8-K 12
Signatures 14
Index to Exhibits 16
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
as of June 30, 1998 and December 31, 1997
June 30, 1998 December 31, 1997
------------- -----------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 68,693 $ 512,339
Accounts receivable, net 12,986,413 11,934,364
Inventories and supplies 1,380,610 402,076
Prepaid expenses 2,624,783 694,434
Deferred tax asset 2,151,700 1,907,800
------------- -------------
Total current assets 19,212,199 15,451,013
------------- -------------
PROPERTY AND EQUIPMENT:
Land and improvements 5,299,837 4,322,837
Buildings and improvements 4,312,229 1,855,092
Furniture and fixtures 2,779,838 2,146,637
Shop and service equipment 1,119,088 1,018,636
Revenue equipment 86,741,280 75,695,123
Leasehold improvements 452,293 432,467
------------- -------------
100,704,565 85,470,792
Less: Accumulated depreciation (22,510,786) (20,025,293)
------------- -------------
PROPERTY AND EQUIPMENT, net 78,193,779 65,445,499
------------- -------------
OTHER ASSETS 948,117 1,793,284
------------- -------------
$ 98,354,095 $ 82,689,796
============= =============
The accompanying notes are an integral part of these consolidated
financial statements.
1
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (continued)
as of June 30, 1998 and December 31, 1997
<TABLE>
<CAPTION>
June 30, 1998 December 31, 1997
------------- -----------------
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 9,318,395 $ 4,847,070
Accrued liabilities 2,549,273 3,082,413
Claims accrual 3,885,067 3,463,322
Line of credit 4,326,719 2,000,000
Current portion of long-term debt -- 14,171
----------- -----------
Total current liabilities 20,079,454 13,406,976
DEFERRED INCOME TAXES 14,977,800 12,485,085
----------- -----------
Total liabilities 35,057,254 25,892,061
----------- -----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $0.01 par value;
authorized 50,000,000 shares,
none issued and outstanding -- --
Common Stock, $0.01 par value;
authorized 100,000,000 shares; issued
and outstanding 14,946,573 and 14,924,423
shares respectively 149,466 149,244
Additional paid-in capital 24,223,757 24,007,385
Retained earnings 38,923,618 32,641,106
----------- -----------
Total shareholders' equity 63,296,841 56,797,735
----------- -----------
$98,354,095 $82,689,796
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
2
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Statements of Income
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
1998 1997 1998 1997
------------ ------------ ------------ --------------
<S> <C> <C> <C> <C>
OPERATING REVENUE $ 30,369,133 $ 24,240,668 $ 58,627,639 $ 45,563,216
------------ ------------ ------------ ------------
OPERATING EXPENSES:
Salaries, wages and benefits 8,521,137 6,619,781 16,851,233 12,664,877
Fuel 2,956,150 2,506,653 5,721,656 4,682,224
Operations and maintenance 1,727,440 1,200,198 3,428,534 2,436,317
Insurance and claims 904,934 711,937 1,708,829 1,198,681
Operating taxes and licenses 1,229,298 980,668 2,355,258 1,878,313
Communications 211,767 125,821 448,176 256,595
Depreciation and amortization 3,010,396 2,267,287 5,807,250 4,392,883
Purchased transportation 5,379,958 4,852,343 10,250,779 9,025,283
Miscellaneous operating expenses 692,426 579,375 1,296,717 1,101,960
------------ ------------ ------------ ------------
24,633,506 19,844,063 47,868,432 37,637,133
------------ ------------ ------------ ------------
Income from operations 5,735,627 4,396,605 10,759,207 7,926,083
------------ ------------ ------------ ------------
OTHER INCOME (EXPENSE):
Interest income 12,001 8,651 21,138 45,179
Interest expense (34,451) (7,506) (82,833) (21,507)
------------ ------------ ------------ ------------
(22,450) 1,145 (61,695) 23,672
------------ ------------ ------------ ------------
Income before taxes 5,713,177 4,397,750 10,697,512 7,949,755
INCOME TAXES (2,360,000) (1,820,000) (4,415,000) (3,280,000)
------------ ------------ ------------ ------------
Net income $ 3,353,177 $ 2,577,750 $ 6,282,512 $ 4,669,755
============ ============ ============ ============
Net income per common share and common share
equivalent: Basic $ 0.22 $ 0.17 $ 0.42 $ 0.31
============ ============ ============ ============
Diluted $ 0.22 $ 0.17 $ 0.41 $ 0.31
============ ============ ============ ============
Weighted average number of common shares
and common share equivalents outstanding:
Basic 14,941,392 14,858,234 14,934,956 14,857,496
============ ============ ============ ============
Diluted 15,255,300 15,123,998 15,251,497 15,118,020
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
3
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
Six Months Ended
June 30
1998 1997
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 6,282,512 $ 4,669,755
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 5,807,250 4,392,883
Allowance for doubtful accounts 56,802 66,093
Deferred income taxes 2,248,815 1,773,542
Changes in assets and liabilities:
Increase in receivables (1,108,851) (685,266)
Increase in inventories and supplies (978,534) (111,102)
Increase in prepaid expenses (1,930,349) (980,611)
Decrease (increase) in other assets 827,939 (223,162)
(Decrease) increase in accounts payable (668,337) 1,623,288
(Decrease) increase in accrued liabilities and
claims accrual (111,395) 181,146
------------ ------------
Net cash provided by operating
activities 10,425,852 10,706,566
------------ ------------
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net (10,663,525) (8,859,345)
------------ ------------
Net cash used in investing activities $(10,663,525) $ (8,859,345)
------------ ------------
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
4
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (continued)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1998 1997
---- ----
<S> <C> <C>
CASH FLOW FROM FINANCING ACTIVITIES:
Borrowing on line of credit, net 2,326,719 --
Payments of debt (14,171) (332,470)
Decrease in accounts payable - equipment (2,735,115) (2,929,800)
Proceeds from exercise of stock options 216,594 196,875
----------- -----------
Net cash used in financing
Activities (205,973) (3,065,395)
----------- -----------
NET DECREASE IN CASH AND CASH
EQUIVALENTS (443,646) (1,218,174)
CASH AND CASH EQUIVALENTS,
beginning of period 512,339 1,244,745
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 68,693 $ 26,571
=========== ===========
SUPPLEMENTAL DISCLOSURES:
Noncash investing and financing transactions:
Equipment acquired by
accounts payable $ 7,874,928 $ 2,861,234
Cash Flow Information:
Income taxes paid $ 2,453,032 $ 2,053,500
Interest paid 82,886 22,856
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
5
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Financial Information
The accompanying consolidated financial statements include the parent company
Knight Transportation, Inc., and its wholly owned subsidiaries, Quad-K Leasing,
Inc.; KTTE Holdings, Inc., QKTE Holdings, Inc., Knight Management Services,
Inc., and Knight Dedicated Services Limited Partnership (hereinafter
collectively called the "Company"). All material intercompany items and
transactions have been eliminated in consolidation.
The consolidated financial statements included herein have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission.
The statements presented do not include all information and footnotes required
to be in conformity with generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring adjustments) considered necessary for a fair presentation
have been included. Results of operations in interim periods are not necessarily
indicative of results for a full year. These consolidated financial statements
and notes thereto should be read in conjunction with the Company's consolidated
financial statements and notes thereto included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1997. The preparation of financial
statements in accordance with generally accepted accounting principles requires
management to make estimates and assumptions. Such estimates and assumptions
affect the reported amounts of assets and liabilities as well as disclosure of
contingent assets and liabilities at the date of the accompanying consolidated
financial statements, and the reported amounts of the revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
Note 2. Recapitalization and Stock Split
On April 22, 1998 the Board of Directors approved a three for two stock split,
effected in the form of a 50 percent stock dividend. The stock split was paid on
May 18, 1998 to stockholders of record at the close of business on May 1, 1998.
This stock split has been given retroactive recognition for all periods
presented in the accompanying consolidated financial statements.
Note 3. Net Income Per Share
In February, 1997, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 128 (SFAS No. 128), Earnings Per
Share, which supersedes Accounting Principles Board (APB) Opinion No. 15, the
existing authoritative guidance. SFAS No. 128 modifies the calculation of
primary and fully diluted earnings per share (EPS) and replaces them with basic
and diluted EPS. SFAS No. 128 is effective for financial statements for both
interim and annual periods presented after December 15, 1997, and as a result,
all prior period EPS data presented has been restated.
6
<PAGE>
A reconciliation of the basic and diluted EPS computations for the three months
and six months ended June 30, 1998, and 1997 is as follows:
KNIGHT TRANSPORTATION, INC.
AND SUBSIDIARIES
SCHEDULE OF COMPUTATION OF NET INCOME PER SHARE
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
1998 1997 1998 1997
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Basic and diluted:
Weighted average common
shares outstanding - basic 14,941,392 14,858,234 14,934,956 14,857,496
Effect of stock options (1) 313,908 265,764 316,541 260,524
---------- ---------- ---------- ----------
Weighted average common
share and common share
equivalents outstanding -
diluted 15,255,300 15,123,998 15,251,497 15,118,020
========== ========== ========== ==========
Net Income 3,353,177 2,577,750 6,282,512 4,669,755
Net income per common share and
common share equivalent
Basic $ .22 $ .17 $ .42 $ .31
========== ========== ========== ==========
Diluted $ .22 $ .17 $ .41 $ .31
========== ========== ========== ==========
</TABLE>
Notes:
(1) Amount calculated using the treasury stock method.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Results of Operations
The Company's operating revenue for the six months ended June 30, 1998,
increased by 28.7% to $58.6 million from $45.6 million over the same period in
1997. For the three months ended June 30, 1998, operating revenue increased by
25.3% to $30.4 million from $24.2 million over the same period in 1997.
The increase in operating revenue resulted from expansion of the Company's
customer base and increased volume from existing customers, and was facilitated
by the continued expansion of the Company's fleet, including an increase in the
Company's independent contractor fleet. The Company's fleet increased by 27.9%
to 866 tractors (including 212 owned by independent contractors) as of June 30,
1998, from 677 tractors (including 185 owned by independent contractors) as of
June 30, 1997. Along with increases in revenue, the Company's revenue per mile
increased to $1.24 per mile for the six months ended June 30, 1998, from $1.22
per mile for the same period in 1997. The revenue per mile increase was
primarily the result of tightened capacity in the marketplace.
Salaries, wages and benefits increased as a percentage of operating revenue to
28.7% for the six months ended June 30, 1998, from 27.8% for the same period in
1997. For the three months ended June 30, 1998, salaries, wages and benefits
increased as a percentage of operating revenue to 28.1% from 27.3% for the same
period in 1997. These increases were primarily the result of the increase in the
ratio of company drivers to independent contractors to 76% as of June 30, 1998
from 73% as of June 30, 1997. For Company drivers, the Company records accruals
for worker's compensation as a component of its claims accrual, and the related
expense is reflected in salaries, wages and benefits expense in its consolidated
statements of income.
Fuel expense decreased as a percentage of operating revenue to 9.8% for the six
months ended June 30, 1998, from 10.3% for the same period in 1997. For the
three months ended June 30, 1998, fuel expenses as a percentage of revenue
decreased to 9.7% from 10.3% for the same period in 1997. These decreases are
primarily the result of lower fuel costs per gallon.
Operations and maintenance expense increased as a percentage of operating
revenue to 5.8% for the six months ended June 30, 1998, from 5.3% for the
corresponding period in 1997. For the three months ended June 30, 1998,
operations and maintenance expense as a percentage of operating revenue
increased to 5.7% from 5.0% for the same period in 1997. These increases
resulted from the relative increase in the ratio of company drivers to
independent contractors as well as slightly higher maintenance costs related to
the age of the Company's fleet.
Insurance and claims expense increased as a percentage of operating revenue to
2.9% for the six months ended June 30, 1998, from 2.6% for the same period in
1997. For the three months ended June 30, 1998, insurance and claims expense
increased as a percentage of operating revenue to 3.0% from 2.9% for the same
period in 1997. These increases were due to a slight increase in the amount of
claims incurred during the period.
8
<PAGE>
Operating taxes and licenses decreased as a percentage of operating revenue to
4.0% for the six months ended June 30, 1998, from 4.1% for the same period in
1997. For the three months ended June 30, 1998 and 1997, operating taxes and
licenses as a percentage of operating revenue remained consistent at 4.0%. The
decrease for the six months ended June 30, 1998 was due to improved utilization
of the Company's fleet.
Communications expense as a percentage of operating revenue for both the six
months and three months ended June 30, 1998 was slightly higher than the same
periods in 1997 as a result of an increase in the overall cost of
communications.
Depreciation and amortization expense as a percentage of operating revenue
increased to 9.9% for the six month period ended June 30, 1998, from 9.6% for
the same period in 1997. For the three months ended June 30, 1998, depreciation
and amortization expense increased as a percentage of operating revenue to 9.9%
from 9.4% for the same period in 1997. These increases were due to the increase
in the ratio of Company drivers to independent contractors.
Purchased transportation decreased as a percentage of operating revenue to 17.5%
for the six months ended June 30, 1998, from 19.8% for the same period in 1997.
For the three months ended June 30, 1998, purchased transportation decreased to
17.7% from 20.0% for the same period in 1997. These decreases were partially due
to the increase in the Company's revenue per mile. Also, these decreases were
due to the decrease in the ratio of independent contractors to company drivers
to 24% as of June 30, 1998 from 27% as of June 30, 1997. Independent contractors
are compensated at a fixed rate per mile.
Miscellaneous operating expenses, as a percentage of operating revenue, were
slightly lower for the three and six months ending June 30, 1998 compared to the
same periods in 1997. These decreases were due to improved utilization of the
Company's fleet.
The Company's operating ratio (operating expenses as a percentage of operating
revenues) for the six months ended June 30, 1998, decreased to 81.6% from 82.6%
for the same period in 1997. The Company's operating ratio for the three months
ended June 30, 1998, decreased to 81.1% from 81.9% for the same period in 1997.
Management believes the decrease in the operating ratio was mainly due to
tightened market capacity that resulted in higher utilization of the Company's
fleet and a corresponding increase in revenue per mile.
For both the six months and three months ended June 30, 1998, net interest
expense increased as a percentage of revenue compared to the same periods in
1997. These increases were primarily a result of the purchase of revenue
equipment related to the growth of the Company's fleet.
Income taxes have been provided at the statutory federal and state rates,
adjusted for certain permanent differences between financial statement and
income tax reporting.
As a result of the preceding, the Company's net income as a percentage of
operating revenue was 10.7% for the six months ended June 30, 1998, compared to
10.2% for the same period in 1997 and 11.0% for the three months ended June 30,
1998, compared to 10.6% for the same period in 1997.
9
<PAGE>
Liquidity and Capital Resources
The growth of the Company's business has required a significant investment in
new revenue equipment. The Company's primary source of liquidity has been funds
provided by operations and the Company's line of credit. Net cash provided by
operating activities was approximately $10.4 million for the first six months of
1998, compared to $10.7 million for the corresponding period in 1997.
Capital expenditures for the purchase of revenue equipment, net of trade-ins,
office equipment and leasehold improvements totaled $18.5 million for the first
six months of 1998 compared to $11.7 million for the same period in 1997.
Net cash used in financing activities and direct financing was approximately
$0.2 million for the first six months of 1998 compared to net cash provided by
financing activities of $3.0 million for the same period in 1997. Net cash used
in financing activities during the first six months of 1998 was the result of
the Company paying cash to fund the expansion of its equipment fleet.
The Company has a $10 million line of credit from its lender and uses that line
to finance the acquisition of revenue equipment and other corporate purposes to
the extent the cost of such acquisitions are not provided by funds from
operations. Under the Company's line of credit, the Company is obligated to
comply with certain financial covenants. The rate of interest on borrowings
against the line of credit will vary depending upon the interest rate elected by
the Company; the Company may elect the London Interbank Offered Rate (LIBOR),
the prime rate, or the lender's certificate of deposit rate. At June 30, 1998,
the Company had $4.3 million of outstanding borrowings under the revolving line
of credit.
Management believes the Company has adequate liquidity to meet its current
needs. The Company will continue to have significant capital requirements over
the long term, which may require the Company to incur debt or seek additional
equity capital. The availability of this capital will depend upon prevailing
market conditions, the market price of the common stock and other factors over
which the Company has no control, as well as the Company's financial condition
and results of operations.
Seasonality
To date, the Company's revenues have not shown any significant seasonal pattern.
Because the Company has operated primarily in Arizona, California and the
western United States, winter weather has not adversely affected the Company's
business. Expansion of the Company's operations into the midwest, on the east
coast, and in the Texas and Louisiana regions, could expose the Company to
greater operating variances due to seasonal weather.
Inflation
Many of the Company's operating expenses, including fuel costs and fuel taxes,
are sensitive to the effects of inflation, which could result in higher
operating costs. The effects of inflation on the Company's business during the
six months ended June 30, 1998, were not significant.
10
<PAGE>
Year 2000
The "Year 2000 Issue" arose because many existing computer programs use only the
last two digits to refer to a year. Therefore, these computer programs do not
properly recognize a year that begins with "20" instead of the familiar "19". If
not corrected, many computer applications could fail or create erroneous
results.
The Company's computer systems are year 2000 compliant, or will be made Year
2000 compliant within the next twelve months. Neither the "Year 2000 Issue" nor
the financial effects of any reviews, testing, or modifications the Company may
undertake in response to that issue are expected to have a material adverse
effect on the Company's business or its consolidated financial position, results
of operations or cash flows. At this time, the Company is unable to determine
whether the impact of the "Year 2000 issue" on its customers or suppliers will
affect the Company.
Recently Issued Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards No. 130, (SFAS No. 130), Reporting
Comprehensive Income. SFAS No. 130 establishes standards for reporting and
display of comprehensive income and its components (revenues, gains, and losses)
in a full set of general-purpose financial statements. SFAS No. 130 requires
that all items that are required to be recognized under accounting standards as
components of comprehensive income be reported in a financial statement that is
displayed with the same prominence as other financial statements.
Reclassification of financial statements for earlier periods provided for
comparative purposes is required. Total comprehensive income was $3,353,177 and
$2,577,750 for the three-month periods ending June 30, 1998 and 1997,
respectively. Total comprehensive income was $6,282,512 and $4,669,755 for the
six-month periods ending June 30, 1998 and 1997, respectively.
In June, 1997, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards No. 131 (SFAS No. 131), Disclosures About
Segments of an Enterprise and Related Information, which supersedes Statement of
Financial Accounting Standards No. 14, Reporting for Segments of a Business
Enterprise. SFAS No. 131 establishes standards for the way that business
enterprises report information about operating segments in annual financial
statements and requires that those enterprises report selected information about
operating segments in interim financial reports issued to shareholders. It also
establishes standards for related disclosures about products and services,
geographic areas, and major customers. This statement is effective for financial
statement periods beginning after December 15, 1997. However, SFAS No. 131 need
not be applied to interim financial statements in the initial year of adoption.
11
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Company is party to ordinary, routine litigation and administrative
proceedings incidental to its business. These proceedings primarily involving
personnel matters, including EEOC claims and claims for personal injury or
property damage incurred in the transportation of freight. The Company maintains
insurance to cover liabilities arising from the transportation of freight in
amounts in excess of self-insured retentions. It is the Company's policy to
comply with applicable equal employment opportunity laws and the Company
periodically reviews its policies and practices for equal employment opportunity
compliance.
Item 2. Changes in Securities
Not Applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K
No. Description
--- -----------
Exhibit 4 Instruments defining the rights of
security holders, including indentures
(a) Articles 4, 10 and 11 of the Restated
Articles of Incorporation of the
Company. (Incorporated by reference to
Exhibit 3.1 to the Company's Report on
Form 10-K for the fiscal year ended
December 31, 1994.)
12
<PAGE>
(b) Sections 2 and 5 of the Amended and
Restated By-laws of the Company.
(Incorporated by reference to Exhibit
3.2 to the Company's Report on Form
10-K for the fiscal year ended December
31, 1995.)
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K during the
three-month period ended June 30, 1998.
13
<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.
KNIGHT TRANSPORTATION, INC.
Date: August 7, 1998 By: /s/ Kevin P. Knight
--------------------------------
Kevin P. Knight
Chief Executive Officer
Date: August 7, 1998 By: /s/ Clark Jenkins
--------------------------------
Clark Jenkins
Chief Financial Officer and
Principal Financial Officer
14
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS TO
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, 1998
Commission File No. 0-24946
15
<PAGE>
KNIGHT TRANSPORTATION, INC.
INDEX TO EXHIBITS TO FORM 10-Q
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Description Numbered Pages(1)
- ----------- ----------- -----------------
<S> <C>
Exhibit 4 Instruments defining the rights of security holders,
including indentures
(a) Articles 4, 10 and 11 of the Restated Articles of
Incorporation of the Company. (Incorporated by reference
to Exhibit 3.1 to the Company's Report on Form 10-K for
the fiscal year ended December 31, 1994.)
(b) Sections 2 and 5 of the Amended and Restated By-laws of
the Company. (Incorporated by reference to Exhibit 3.2
to the Company's Report on Form 10-K for the fiscal year
ended December 31, 1995.)
</TABLE>
Exhibit 27 Financial Data Schedule
(1) The page numbers where exhibits (other than those incorporated by reference)
may be found are indicated only on the manually signed report.
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the Company's
consolidated financial statements and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> JUN-30-1998
<EXCHANGE-RATE> 1
<CASH> 68,693
<SECURITIES> 0
<RECEIVABLES> 13,500,859
<ALLOWANCES> 514,446
<INVENTORY> 1,380,610
<CURRENT-ASSETS> 19,212,199
<PP&E> 100,704,565
<DEPRECIATION> (22,510,786)
<TOTAL-ASSETS> 98,354,095
<CURRENT-LIABILITIES> 20,079,454
<BONDS> 0
0
0
<COMMON> 149,466
<OTHER-SE> 63,147,375
<TOTAL-LIABILITY-AND-EQUITY> 98,354,095
<SALES> 0
<TOTAL-REVENUES> 58,627,639
<CGS> 0
<TOTAL-COSTS> 47,868,432
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 61,695
<INCOME-PRETAX> 10,697,512
<INCOME-TAX> 4,415,000
<INCOME-CONTINUING> 6,282,512
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,282,512
<EPS-PRIMARY> .42
<EPS-DILUTED> .41
<FN>
RECAPITALIZATION AND STOCK SPLIT
On April 22,1998 the Board of Directors approved a three for two stock split,
effected in the form of a 50 percent stock dividend. The stock split was paid on
May 18, 1998 to stockholders of record at the close of business on May 1, 1998.
Prior Financial Data Schedules have not been restated for the recapitalization
and stock split.
</FN>
</TABLE>
