SOURCE: American Commercial Lines Inc.

American Commercial Lines Inc.

February 28, 2012 16:49 ET

Commercial Barge Line Company Announces Results for Quarter and Year Ended December 31, 2011

JEFFERSONVILLE, IN--(Marketwire - Feb 28, 2012) - Commercial Barge Line Company today announced results for the quarter and year ended December 31, 2011.

Highlights

  • Adjusted EBITDAR of $174.3 million for the year -- a 20.5% increase over prior year due to strength in end markets and implementation of operating improvements.

    • Implemented $63.7 million in annualized operational improvements -- $43.3 million of which were realized in 2011 Adjusted EBITDAR.
    • Run-rate Adjusted EBITDAR of $194.7 million, including the annualized impact of these operational improvements.

  • Operating income of $22.9 million in the fourth quarter improved 26.7%, after adjusting for non-cash purchase price accounting impacts and direct acquisition costs.

  • Fourth quarter cash generated from operating activities of $76.8 million.

  • Net Funded Debt to Adjusted EBITDAR ratio of 2.3 times at year-end - declines to 2.0 times based on run-rate Adjusted EBITDAR.

  • Strong liquidity with $233 million in available borrowing capacity as of December 31, 2011.

Revenues

Revenues for the year ended December 31, 2011 increased 18.0% over prior year revenues to $852.9 million. Transportation segment revenues increased 14.0% over prior year revenues to $721.1 million, with ton-mile volume increasing 2.7% to 34.8 billion ton-miles. Improvements in asset utilization enabled the Company to achieve such results while operating a barge fleet that was 5% smaller than the prior year. On a fuel-neutral basis, transportation revenues increased 5.5% for the year, driven by strength across most commodities, with particularly robust demand experienced in the Company's petroleum and chemical business. Grain revenues, however, offset much of the strength in other commodities as a result of a delay in the harvest, increased domestic demand and the Company's strategic decision to increase the diversification of its commodity mix in the fourth quarter. Demurrage revenues in the Company's dry cargo business for 2011 also increased over prior year levels by 18.2%, driven primarily by increased rates implemented by the Company specifically as part of the operating improvement initiatives discussed later in this release.

Revenues for the quarter ended December 31, 2011 increased 17.1% to $244.5 million. Transportation segment revenues increased by 9.1% in the quarter to $200.3 million while ton-mile volume compared to the same period of 2010 decreased 0.2%, with the increase in revenues attributable to higher fuel surcharges. On a fuel-neutral basis, transportation revenues were down 1.7% for the quarter. Fourth quarter volumes are generally heavily weighted to grain activity, and the delay in the 2011 harvest, increased domestic demand and the Company's strategic decision to increase the diversification of its commodity mix contributed to lower overall revenues compared to the prior year's fourth quarter.

Manufacturing segment revenues increased $41.8 million, or 46.4% for the year ended December 31, 2011, with 239 total barges sold in 2011 compared to 140 in the prior year. Manufacturing segment revenue increased $19.0 million, or 75.4%, in the quarter, reflecting the delivery of 77 barges to third-parties compared to 47 in the prior year period. The increase in volume experienced by the manufacturing segment during the year was the direct result of operating improvements implemented during the year that facilitated improved production yield from the Company's existing operations. The manufacturing segment's external revenue backlog at the end of 2011 of $101.2 million was comparable to the prior year's backlog.

Operating Results

For the year ended December 31, 2011, the Company generated operating income of $3.7 million as compared to operating income of $49.8 million for the same period in the prior year. This decline in operating income of $46.1 million between periods was the result of $65.7 million of non-comparable costs, including charges related to non-cash purchase accounting items and transition expenses directly associated with the Company's acquisition and losses associated with the extreme flooding experienced in the second quarter of 2011. For the quarter ended December 31, 2011, operating income was $22.9 million as compared to $19.7 million for the same period of the prior year. Total non-cash purchase accounting and direct acquisition expenses were $5.4 million higher in the fourth quarter of 2011 as compared to the prior year's fourth quarter.

Transportation segment operating income was $1.7 million for the year ended December 31, 2011, compared to $49.8 million for the prior year. For the manufacturing segment, operating income was $2.0 million for the year ended December 31, 2011, as compared to break-even in the prior year. Transportation segment operating income was $20.7 million for the quarter ended December 31, 2011, compared to $19.1 million for the same period in the prior year. For the manufacturing segment, operating income was $2.2 million for the quarter ended December 31, 2011, as compared to $0.5 million in the prior year period.

As a result of the magnitude of these non-comparable items, operating results of the Company are discussed herein based on Adjusted EBITDAR, which is a non-GAAP financial measure that the Company believes provides investors with a useful tool for analyzing its operating results as it eliminates the impact of certain non-comparable items. The Company has included a reconciliation of its financial results to Adjusted EBITDAR elsewhere in this release.

Adjusted EBITDAR

For the year ended December 31, 2011, Adjusted EBITDAR was $174.3 million, a 20.5% increase over $144.7 million for the prior year. The increase was predominantly driven by the realization of $43.3 million of operational improvements and by an improvement in pricing and business mix of $22.8 million. These gains were partially offset by several factors, including higher net fuel costs resulting from increased diesel prices ($7.5 million), increased fleet maintenance costs ($9.3 million) and other operating cost increases, including the impact of increased port and third-party services costs, general inflation and higher employee benefit costs ($13.2 million). In addition, the Company realized $6.5 million less in gains on the sale of assets during 2011 compared to the prior year. Year-over-year, Adjusted EBITDAR for the transportation segment was up 14.7% or $20.6 million and the manufacturing segment was up $9.0 million.

Adjusted EBITDAR for the three months ended December 31, 2011 was $60.3 million, a 6.3% increase over the prior year's total for the comparable period of $56.7 million. For the transportation segment, Adjusted EBITDAR was $55.6 million for the quarter ended December 31, 2011 compared to $54.8 million for the prior year period. For the quarter, positive earnings growth driven by strength in most commodity categories and the net benefit of operational improvements realized were partially offset by the decline in grain volumes discussed earlier. For the manufacturing segment, Adjusted EBITDAR was $4.7 million for the quarter ended December 31, 2011, compared to $1.9 million for the prior year period.

Operational Improvements

At the beginning of 2011, the Company embarked on a vigorous effort to improve its operations and profitability. Over 70 actions were identified and implemented in a wide variety of functional areas, including supply chain, logistics, operations, commercial arrangements, manufacturing processes, administration and asset management. The implementation of these operational initiatives yielded $43.3 million of earnings improvement in 2011 and $63.8 million on an annualized basis. These actions were taken not only with the objective of permanently improving the Company's cost structure but also to ensure that traffic density and asset utilization are improved upon and that the business mix is shifted further towards recurring, predictable and profitable revenues.

The Company's efforts to improve its profitability are and will remain ongoing in the future. In 2011, the operational improvements realized resulted in savings in the following categories: a reduction in personnel and support infrastructure costs of $14.6 million, a pick-up of $9.6 million due to improved commercial terms with customers, $7.7 million in improvements from renegotiating terms with vendors and other supply chain actions, $6.0 million saved by changing operating processes and implementing productivity initiatives, $4.9 million benefit from improved asset utilization and productivity levels at Jeffboat and $0.5 million in savings resulting from strategic investments made in the Company's boat fleet.

Savings associated with the specific operating improvement actions that were implemented during 2011 are expected to add an additional $20.4 million to 2012 operating results when their impact is realized during a full 12 month period. These include $4.4 million related to commercial terms, $6.2 million in supply chain savings, $2.1 million in personnel costs, $3.0 million in operating productivity and cost savings from investments made in the Company's boat fleet of $4.7 million. Giving consideration to the full annual impact of these improvements along with Adjusted EBITDAR for the year ended December 31, 2011 would have yielded a run-rate Adjusted EBITDAR of $194.7 million.

Commenting on the results, Mark Knoy, President and Chief Executive Officer, stated, "We are very pleased with the operating performance of the Company as we finished 2011. Significant improvements have been driven throughout the Company's operations and have resulted in a meaningful pick-up year-over-year in Adjusted EBITDAR and an impressive run-rate Adjusted EBITDAR. We continue to see strength in the liquids business and our export coal business ended the year strong. In addition, we further strengthened our balance sheet during the fourth quarter through the generation of $76.8 million of cash from operations. Performance at Jeffboat continues to improve, through changes in production processes and a renewed focus on business mix. As a result, we achieved higher absolute throughput in the shipyard where we produced 15 more barges in the fourth quarter and 91 more barges for the year compared to the prior year periods. These gains directly resulted in a substantial improvement in the overall earnings contribution from our Jeffboat operations.

"As we look forward, we believe that the demand for our transportation services will remain solid in 2012. Increasing domestic crude oil production and historically low natural gas prices are providing an environment that we believe will continue to drive positive market conditions for our liquids business. Coal market dynamics are also suggesting that export markets will continue to provide good demand for domestic coal producers over the long-term, which will provide the Company with a strong growth opportunity. Further, we anticipate continued pressure on the supply and demand balance of overall industry hopper barge capacity which will support our significant presence in the dry cargo transportation segment. Overall, we are monitoring market conditions closely and are maintaining a disciplined approach to our operations that will allow us to continue to realize and build upon the gains we achieved in operating efficiency in 2011.

"During 2011, we invested slightly more than $72 million in net capital to support our long-term strategic objectives, including the addition of 65 new dry covered hopper barges and two liquid tank barges. As we drive our business toward improved productivity and earnings generation, we will continue to support these efforts by replacing aging and inefficient barges and strategically investing in our boat fleet provided returns justify such investments. Opportunities currently exist to invest in our boat fleet through the repowering of existing units, which drives significant fuel savings and operating efficiencies. We have identified 14 boats in our fleet that are candidates for such investments in 2012. In addition, we are pursuing a fleet optimization and investment program that could see us add as many as 220 new dry hopper barges and 45 liquid tank barges to our fleet to allow us to pursue identified growth and productivity opportunities. The plan also calls for the scrapping of nearly 400 barges and the sale of as many as 14 boats that have been made redundant largely because of the operational improvements realized in 2011. With that said, it is important to note that this type of investment program is iterative by nature and will continually be assessed by the Company in relation to prevailing and forecasted market conditions, specific commercial opportunities as well as the outcome of other strategic activities the Company is engaged in including, but not limited to, the evaluation of potential acquisitions. As a result of the proposed investment in new barges and continued strong third-party demand, Jeffboat is expected to be fully utilized throughout 2012 and into 2013, which would provide it with a stable and predictable order book. To fund these strategic efforts, we will rely on our cash flow from operations, proceeds we expect to realize from the sale of retired and excess assets, and borrowings under our revolving credit facility. In the event changes in market conditions lead us to revise our outlook, we are prepared to reduce these strategic investment levels accordingly."

Net Income

For the year ended December 31, 2011, the Company had a net loss of $14.2 million, compared to a net loss $2.9 million in the prior year. For the quarter ended December 31, 2011, the Company had net income of $10.2 million, compared to a net loss of $3.1 million in the quarter ended December 31, 2010. Net income (loss) for the 2011 periods reflects the after-tax impact of those factors impacting operating income and Adjusted EBITDAR discussed above as well as the after-tax impact of lower interest expense of $1.2 million and $5.5 million for the quarter and year ended December 31, 2011.

Liquidity and Debt Position

As of December 31, 2011, our outstanding debt totaled $384.2 million, including the unamortized purchase accounting debt premium of $29.1 million. The Company was in compliance with all debt covenants on December 31, 2011 and had $318.0 million in remaining availability under its credit facility, of which $233.0 million was available for use. The credit facility has no maintenance financial covenants unless borrowing availability is generally less than $48.8 million. As of December 31, 2011, the present value of the lease payments associated with revenue generating equipment was approximately $38.4 million. Including the present value of these lease payments, the Company's total indebtedness was $422.6 million as of December 31, 2011. The ratio of funded net debt to Adjusted EBITDAR reflected an improvement to 2.3 times as of December 31, 2011 compared to 2.7 times as of December 31, 2010. This ratio shows further improvements to 2.0 times when the affect of operating improvements that are reflected in run-rate Adjusted EBITDAR are considered.

About the Company

Commercial Barge Line Company, headquartered in Jeffersonville, Indiana, is an integrated marine transportation and service company operating in the United States Jones Act trades. For more information about the Company, visit the Company's website at www.aclines.com.

Forward-Looking Statements

This release includes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's present expectations and beliefs about future events. As with any projection or forecast, these statements are inherently susceptible to risks, uncertainty and changes in circumstance. Important factors could cause actual results to differ materially from those expressed or implied by the forward-looking statements and should be considered in evaluating the outlook of Commercial Barge Line Company. Risks and uncertainties are detailed from time to time in Commercial Barge Line Company's filings with the SEC, including our report on Form 10-K for the year ended December 31, 2010 and our most recent Form 10-Q. Commercial Barge Line Company is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of changes, new information, subsequent events or otherwise.

COMMERCIAL BARGE LINE COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
(Unaudited)
Successor
Company
Three Months Ended
December 31, 2011
Predecessor
Company
October 1 to
December 21, 2010
Successor
Company
December 22 to
December 31, 2010
Revenues
Transportation and Services $ 200,302 $ 164,059 $ 19,602
Manufacturing 44,202 20,209 4,986
Revenues 244,504 184,268 24,588
Cost of Sales
Transportation and Services 166,964 127,659 16,830
Manufacturing 41,494 19,024 4,838
Cost of Sales 208,458 146,683 21,668
Gross Profit 36,046 37,585 2,920
Selling, General and Administrative Expenses 13,129 12,751 8,095
Operating Income (Loss) 22,917 24,834 (5,175 )
Other Expense (Income)
Interest Expense 7,318 8,489 805
Debt Retirement Expenses - 8,701 -
Other, Net (436 ) 28 (19 )
Other Expenses 6,882 17,218 786
Income (Loss) from Continuing Operations before Income Taxes 16,035 7,616 (5,961 )
Income Taxes 6,174 4,451 628
Income (Loss) from Continuing Operations 9,861 3,165 (6,589 )
Discontinued Operations, Net of Tax 367 365 (46 )
Net Income (Loss) $ 10,228 $ 3,530 $ (6,635 )
COMMERCIAL BARGE LINE COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
(Unaudited)
Successor
Company
Year Ended
December 31, 2011
Predecessor
Company
January 1 to
December 21, 2010
Successor
Company
December 22 to
December 31, 2010
Revenues
Transportation and Services $ 721,095 $ 613,065 $ 19,602
Manufacturing 131,842 85,054 4,986
Revenues 852,937 698,119 24,588
Cost of Sales
Transportation and Services 665,266 517,080 16,830
Manufacturing 127,871 82,504 4,838
Cost of Sales 793,137 599,584 21,668
Gross Profit 59,800 98,535 2,920
Selling, General and Administrative Expenses 56,095 43,554 8,095
Operating Income (Loss) 3,705 54,981 (5,175 )
Other Expense (Income)
Interest Expense 29,963 37,923 805
Debt Retirement Expenses - 8,701 -
Other, Net (968 ) (313 ) (19 )
Other Expenses 28,995 46,311 786
(Loss) Income from Continuing Operations before Income Taxes (25,290 ) 8,670 (5,961 )
Income Tax (Benefit) Expense (10,610 ) 5,540 628
(Loss) Income from Continuing Operations (14,680 ) 3,130 (6,589 )
Discontinued Operations, Net of Tax 489 620 (46 )
Net (Loss) Income $ (14,191 ) $ 3,750 $ (6,635 )
COMMERCIAL BARGE LINE COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
Successor
Company
December 31,
2011
Successor
Company
December 31,
2010 (1)
ASSETS
Current Assets
Cash and Cash Equivalents $ 938 $ 3,707
Accounts Receivable, Net 87,368 83,518
Inventory 62,483 50,834
Deferred Tax Asset 6,390 10,072
Assets Held for Sale 1,612 2,133
Prepaid and Other Current Assets 19,308 32,075
Total Current Assets 178,099 182,339
Properties, Net 935,576 979,655
Investment in Equity Investees 6,470 5,743
Accounts Receivable, Intercompany 12,021 17,400
Goodwill 17,692 20,470
Other Assets 45,521 53,665
Total Assets $ 1,195,379 $ 1,259,272
LIABILITIES
Current Liabilities
Accounts Payable $ 48,653 $ 44,782
Accrued Payroll and Fringe Benefits 20,035 27,992
Deferred Revenue 15,251 14,132
Accrued Claims and Insurance Premiums 13,823 12,114
Accrued Interest 11,708 11,667
Customer Deposits 1,165 500
Other Liabilities 29,104 25,810
Total Current Liabilities 139,739 136,997
Long Term Debt 384,225 385,152
Pension and Post Retirement Liabilities 67,531 38,615
Deferred Tax Liability 178,602 208,651
Other Long Term Liabilities 46,335 60,901
Total Liabilities 816,432 830,316
STOCKHOLDER'S EQUITY
Other Capital 424,932 435,487
Retained Deficit (20,826 ) (6,635 )
Accumulated Other Comprehensive (Loss) Income (25,159 ) 104
Total Stockholder's Equity 378,947 428,956
Total Liabilities and Stockholder's Equity $ 1,195,379 $ 1,259,272
(1) The Consolidated Balance Sheet at December 31, 2010 has been derived from the audited consolidated financial statements at that date, but does not included all the information and footnotes required by generally accepted accounting principles.
COMMERCIAL BARGE LINE COMPANY
INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDAR FROM CONTINUING OPERATIONS RECONCILIATION
(In thousands)
(Unaudited)
Quarter Ended Dec. 31, Year Ended Dec. 31,
2011 2010 (a) 2011 2010 (a)
Net Income (Loss) from Continuing Operations $ 9,861 $ (3,424 ) $ (14,680 ) $ (3,459 )
Adjustments from Continuing Operations:
Interest Income (1 ) (2 ) (163 ) (3 )
Interest Expense 7,318 9,294 29,963 38,728
Debt Retirement Expenses - 8,701 - 8,701
Depreciation and Amortization 26,924 12,969 108,944 47,835
Long-term Boat and Barge Rents 3,892 3,777 15,442 15,166
Taxes 6,174 5,079 (10,610 ) 6,168
EBITDAR from Continuing Operations 54,168 36,394 128,896 113,136
Other Non-cash or Non-comparable Charges Included in Net Income:
Share Based Compensation (1) $ 116 $ 4,357 $ 2,320 $ 7,377
Direct Merger Expenses, Strategic and Management Consulting Fees and Net Impact of Purchase Accounting (2) 5,247 11,140 21,977 11,140
Compensation Cost Savings (3) - 3,008 - 9,023
Public Company Costs (4) - 625 - 2,500
Restructuring Costs (5) 328 1,167 2,710 1,500
Weather and Claims (6) 408 - 18,351 -
Total non-comparable/non-cash charges $ 6,099 $ 20,297 $ 45,358 $ 31,540
Adjusted EBITDAR from Continuing Operations $ 60,267 $ 56,691 $ 174,254 $ 144,676
Annualized Impact of Operating Initiatives (7) - - 20,488 -
Run-rate Adjusted EBITDAR from Continuing Operations $ 60,267 $ 56,691 $ 194,742 $ 144,676
1 Non-cash share-based compensation expense
2 Includes direct merger expenses, strategic and management consulting fees and net impact of purchase accounting
3 Reflects higher annual incentive accruals in 2010 than plan in place for 2011
4 Reflects certain costs of being a company with publicly traded equity internalized in 2011, including investor relations expenses, board of director expenses and incremental audit fees.
5 Includes severance to separating executives
6 Includes the estimated margin impact of second quarter 2011 flooding and other unusual claims costs
7 Represents the annualized impact of operating improvements implemented during 2011 for which the full year impact has not been fully realized in the actual financial results, that are expected to be realized in 2012.
(a) Includes approximately $1.1 million in additional expenses resulting from new basis of accounting in the ten-day period ended December 31, 2010. This impact by line item is as follows:
Fuel $ 0.3
Depreciation and amortization 1.7
Interest expense (0.2 )
Income tax benefit 0.7
Total $ 1.1
Management considers EBITDAR to be a meaningful indicator of operating performance and uses it as a measure to assess the operating performance of the Company's business segments. EBITDAR provides us with an understanding of one aspect of earnings before the impact of investing and financing transactions and income taxes. EBITDAR should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, which is determined in accordance with generally accepted accounting principles ("GAAP"). EBITDAR excludes components that are significant in understanding and assessing our results of operations and cash flows. In addition, EBITDAR is not a term defined by GAAP and as a result our measure of EBITDAR might not be comparable to similarly titled measures used by other companies.
However, the Company believes that EBITDAR is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance.
COMMERCIAL BARGE LINE COMPANY
TRANSPORTATION SEGMENT
INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDAR FROM CONTINUING OPERATIONS RECONCILIATION
(In thousands)
(Unaudited)
Quarter Ended Dec. 31, Year Ended Dec. 31,
2011 2010 (a) 2011 2010 (a)
Income (Loss) from Continuing Operations $ 7,547 $ (3,844 ) $ (16,862 ) $ (3,291 )
Adjustments from Continuing Operations:
Interest Income (1 ) (1 ) (163 ) (2 )
Interest Expense 7,318 9,294 29,963 38,728
Debt Retirement Expenses - 8,701 - 8,701
Depreciation and Amortization 24,944 11,901 101,016 44,269
Long-term Boat and Barge Rents 3,892 3,777 15,442 15,166
Taxes 6,174 5,079 (10,610 ) 6,168
EBITDAR from Continuing Operations 49,874 34,907 118,786 109,739
Other Non-cash or Non-comparable Charges Included in Net Income:
Share Based Compensation (1) $ 116 $ 3,995 $ 2,320 $ 6,742
Direct Merger Expenses, Strategic and Management Consulting Fees and Net Impact of Purchase Accounting (2) 5,247 10,850 21,160 10,850
Compensation Cost Savings (3) - 2,918 - 8,754
Public Company Costs (4) - 625 - 2,500
Restructuring Costs (5) 328 1,457 2,710 1,790
Weather and Claims (6) - - 15,994 -
Total non-comparable/non-cash charges $ 5,691 $ 19,845 $ 42,184 $ 30,636
Adjusted EBITDAR from Continuing Operations $ 55,565 $ 54,752 $ 160,970 $ 140,375
Annualized Impact of Operating Initiatives (7) - - 19,939 -
Run-rate Adjusted EBITDAR from Continuing Operations $ 55,565 $ 54,752 $ 180,909 $ 140,375
1 Non-cash share-based compensation expense
2 Includes direct merger expenses, strategic and management consulting fees and net impact of purchase accounting
3 Reflects higher annual incentive accruals in 2010 than plan in place for 2011
4 Reflects certain costs of being a company with publicly traded equity internalized in 2011, including investor relations expenses, internal audit expenses, board of director expenses and incremental audit fees.
5 Includes severance to separating executives
6 Includes the estimated margin impact of second quarter 2011 flooding and other unusual claims costs
7 Represents the annualized impact of operating improvements implemented during 2011 for which the full year impact has not been fully realized in the actual financial results, that are expected to be realized in 2012.
(a) Includes approximately $0.9 million in additional expenses resulting from new basis of accounting in the ten-day period ended December 31, 2010. This impact by line item is as follows:
Fuel $ 0.3
Depreciation and amortization 1.5
Interest expense (0.2 )
Income tax benefit 0.7
Total $ 0.9
Management considers EBITDAR to be a meaningful indicator of operating performance and uses it as a measure to assess the operating performance of the Company's business segments. EBITDAR provides us with an understanding of one aspect of earnings before the impact of investing and financing transactions and income taxes. EBITDAR should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, which is determined in accordance with generally accepted accounting principles ("GAAP"). EBITDAR excludes components that are significant in understanding and assessing our results of operations and cash flows. In addition, EBITDAR is not a term defined by GAAP and as a result our measure of EBITDAR might not be comparable to similarly titled measures used by other companies.
However, the Company believes that EBITDAR is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance.
COMMERCIAL BARGE LINE COMPANY
MANUFACTURING SEGMENT
INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDAR FROM CONTINUING OPERATIONS RECONCILIATION
(In thousands)
(Unaudited)
Quarter Ended Dec. 31, Year Ended Dec. 31,
2011 2010 (a) 2011 2010 (a)
Income (Loss) from Continuing Operations $ 2,317 $ 418 $ 2,187 $ (164 )
Adjustments from Continuing Operations:
Depreciation and Amortization 1,980 1,068 7,928 3,566
EBITDAR from Continuing Operations 4,297 1,486 10,115 3,402
Other Non-cash or Non-comparable Charges Included in Net Income:
Share Based Compensation (1) $ - $ 362 $ - $ 635
Direct Merger Expenses, Strategic and Management Consulting Fees and Net Impact of Purchase Accounting (2) - - 817 -
Compensation Cost Savings (3) - 90 - 269
Weather and Claims (4) 408 - 2,357 -
Total non-comparable/non-cash charges $ 408 $ 452 $ 3,174 $ 904
Adjusted EBITDAR from Continuing Operations $ 4,705 $ 1,938 $ 13,289 $ 4,306
Annualized Impact of Operating Initiatives (5) - - 549 -
Run-rate Adjusted EBITDAR from Continuing Operations $ 4,705 $ 1,938 $ 13,838 $ 4,306
1 Non-cash share-based compensation expense
2 Includes direct merger expenses, strategic and management consulting fees and net impact of purchase accounting
3 Reflects higher annual incentive accruals in 2010 than plan in place for 2011
4 Includes the estimated margin impact of second quarter 2011 flooding and other unusual claims costs
5 Represents the annualized impact of operating improvements implemented during 2011 for which the full year impact has not been fully realized in the actual financial results, that are expected to be realized in 2012.
(a) Includes approximately $0.2 million in additional depreciation and amortization expenses resulting from new basis of accounting in the ten-day period ended December 31, 2010.
Management considers EBITDAR to be a meaningful indicator of operating performance and uses it as a measure to assess the operating performance of the Company's business segments. EBITDAR provides us with an understanding of one aspect of earnings before the impact of investing and financing transactions and income taxes. EBITDAR should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, which is determined in accordance with generally accepted accounting principles ("GAAP"). EBITDAR excludes components that are significant in understanding and assessing our results of operations and cash flows. In addition, EBITDAR is not a term defined by GAAP and as a result our measure of EBITDAR might not be comparable to similarly titled measures used by other companies.
However, the Company believes that EBITDAR is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance.
COMMERCIAL BARGE LINE COMPANY
Statement of Operating Income by Reportable Segment
(In thousands)
(Unaudited)
Reportable Segments All Other Intersegment
Transportation Manufacturing Segments Elimination Total
Successor Company
Three Months ended December 31, 2011
Total revenue $ 200,570 $ 49,989 $ - $ (6,055 ) $ 244,504
Intersegment revenues 268 5,787 - (6,055 ) -
Revenue from external customers 200,302 44,202 - - 244,504
Operating expense
Materials, supplies and other 58,006 - - - 58,006
Rent 6,932 - - - 6,932
Labor and fringe benefits 30,011 - - - 30,011
Fuel 44,688 - - - 44,688
Depreciation and amortization 24,944 - - - 24,944
Taxes, other than income taxes 3,137 - - - 3,137
Gain on disposition of equipment (754 ) - - - (754 )
Cost of goods sold - 41,494 - - 41,494
Total cost of sales 166,964 41,494 - - 208,458
Selling, general & administrative 12,647 479 3 - 13,129
Total operating expenses 179,611 41,973 3 - 221,587
Operating income (loss) $ 20,691 $ 2,229 $ (3 ) $ - $ 22,917
Predecessor Company
October 1, 2010 to December 21, 2010
Total revenue $ 164,429 $ 31,524 $ - $ (11,685 ) $ 184,268
Intersegment revenues 370 11,315 - (11,685 ) -
Revenue from external customers 164,059 20,209 - - 184,268
Operating expense
Materials, supplies and other 52,915 - - - 52,915
Rent 4,651 - - - 4,651
Labor and fringe benefits 30,955 - - - 30,955
Fuel 28,637 - - - 28,637
Depreciation and amortization 9,369 - - - 9,369
Taxes, other than income taxes 2,795 - - - 2,795
Gain on disposition of equipment (1,664 ) - - - (1,664 )
Cost of goods sold - 19,024 1 - 19,025
Total cost of sales 127,658 19,024 1 - 146,683
Selling, general & administrative 12,009 743 (1 ) - 12,751
Total operating expenses 139,667 19,767 - - 159,434
Operating income $ 24,392 $ 442 $ - $ - $ 24,834
COMMERCIAL BARGE LINE COMPANY
Statement of Operating Income by Reportable Segment
(In thousands)
(Unaudited)
Reportable Segments All Other Intersegment
Transportation Manufacturing Segments Elimination Total
Successor Company
December 22, 2010 to December 31, 2010
Total revenue $ 19,652 $ 4,986 $ - $ (50 ) $ 24,588
Intersegment revenues 50 - - (50 ) -
Revenue from external customers 19,602 4,986 - - 24,588
Operating expense
Materials, supplies and other 6,311 - - - 6,311
Rent 570 - - - 570
Labor and fringe benefits 3,102 - - - 3,102
Fuel 3,986 - - - 3,986
Depreciation and amortization 2,532 - - - 2,532
Taxes, other than income taxes 330 - - - 330
Cost of goods sold - 4,838 (1 ) - 4,837
Total cost of sales 16,831 4,838 (1 ) - 21,668
Selling, general & administrative 8,029 65 1 - 8,095
Total operating expenses 24,860 4,903 - - 29,763
Operating (loss) income $ (5,258 ) $ 83 $ - $ - $ (5,175 )
COMMERCIAL BARGE LINE COMPANY
Statement of Operating Income by Reportable Segment
(Dollars in thousands)
(Unaudited)
Reportable Segments All Other Intersegment
Transportation Manufacturing Segments Elimination Total
Successor Company
Year ended December 31, 2011
Total revenue $ 722,244 $ 171,477 $ - $ (40,784 ) $ 852,937
Intersegment revenues 1,149 39,635 - (40,784 ) -
Revenue from external customers 721,095 131,842 - - 852,937
Operating expense
Materials, supplies and other 239,653 - - - 239,653
Rent 27,856 - - - 27,856
Labor and fringe benefits 114,812 - - - 114,812
Fuel 171,607 - - - 171,607
Depreciation and amortization 101,016 - - - 101,016
Taxes, other than income taxes 12,344 - - - 12,344
Gain on disposition of equipment (2,022 ) - - - (2,022 )
Cost of goods sold - 127,871 - - 127,871
Total cost of sales 665,266 127,871 - - 793,137
Selling, general & administrative 54,150 1,940 5 - 56,095
Total operating expenses 719,416 129,811 5 - 849,232
Operating income (loss) $ 1,679 $ 2,031 $ (5 ) $ - $ 3,705
Predecessor Company
January 1, 2010 to December 21, 2010
Total revenue $ 613,939 $ 117,641 $ - $ (33,461 ) $ 698,119
Intersegment revenues 874 32,587 - (33,461 ) -
Revenue from external customers 613,065 85,054 - - 698,119
Operating expense
Materials, supplies and other 212,567 - - - 212,567
Rent 20,222 - - - 20,222
Labor and fringe benefits 122,462 - - - 122,462
Fuel 117,372 - - - 117,372
Depreciation and amortization 41,737 - - - 41,737
Taxes, other than income taxes 11,741 - - - 11,741
Gain on disposition of equipment (9,021 ) - - - (9,021 )
Cost of goods sold - 82,504 - - 82,504
Total cost of sales 517,080 82,504 - - 599,584
Selling, general & administrative 40,882 2,667 5 - 43,554
Total operating expenses 557,962 85,171 5 - 643,138
Operating income (loss) $ 55,103 $ (117 ) $ (5 ) $ - $ 54,981
Reportable Segments All Other Intersegment
Transportation Manufacturing Segments Elimination Total
Successor Company
December 22, 2010 to December 31, 2010
Total revenue $ 19,652 $ 4,986 $ - $ (50 ) $ 24,588
Intersegment revenues 50 - - (50 ) -
Revenue from external customers 19,602 4,986 - - 24,588
Operating expense
Materials, supplies and other 6,311 - - - 6,311
Rent 570 - - - 570
Labor and fringe benefits 3,102 - - - 3,102
Fuel 3,986 - - - 3,986
Depreciation and amortization 2,532 - - - 2,532
Taxes, other than income taxes 330 - - - 330
Cost of goods sold - 4,838 (1 ) - 4,837
Total cost of sales 16,831 4,838 (1 ) - 21,668
Selling, general & administrative 8,029 65 1 - 8,095
Total operating expenses 24,860 4,903 - - 29,763
Operating (loss) income $ (5,258 ) $ 83 $ - $ - $ (5,175 )

Contact Information

  • Kim Durbin
    Manager, Corporate Communications
    812-288-1915
    Email Contact