-- Revenues of $85.9 million, up 25.2 percent from $68.6 million
-- Transportation income of $7.4 million, up 15.6 percent from $6.4
million
-- Operating margin of 8.6 percent, down 0.7 percentage points
-- EBITDA of $16.2 million, up 26.6 percent from $12.8 million
-- Net loss of $10.3 million compared to a net loss of $5.1 million
MANAGEMENT OVERVIEW
José F. Serrano, chairman and chief executive officer of Grupo TMM, stated,
"During the past several quarters TMM has substantially exceeded
year-to-year comparisons in revenues, transportation income an EBITDA.
"We are pleased to announce the issuance in the Mexican Market of the
securities of the second tranche of our Trust Certificates Program for
$1.55 billion pesos, or approximately $136.9 million dollars, at a rate of
TIIE, or Mexico's Interbank Equilibrium Interest Rate, +195 basis points.
These Certificates will be funded Wednesday of this week.
"This accomplishment provides TMM the ability to grow through the
acquisition of new ships with long-term financing tied to the useful life
of these vessels and is non recourse to the Company. The second issuance of
this Program was rated AA- (mex) by Fitch Ratings, reflecting TMM's
continued quality operating performance, increased demand for maritime
transportation services and the Mexican Navigation Law principles.
"The proceeds from the second tranche of this Program will be used to
acquire additional offshore vessels, to repay existing debt, to fund cash
reserves required for the structure and to pay issuance related expenses.
We anticipate annual revenues from these new vessels of approximately $29.0
million and an annual EBITDA of approximately $21.8 million. With this
issuance the net debt of the Company will increase $90 million.
"We expect to close the third tranche of our Trust Certificates Program for
an estimated amount of $3.4 billion pesos in the third quarter of this
year. With these proceeds, we anticipate to acquire seven vessels, to
include product tankers and highly specialized offshore vessels.
"Pemex has published the final terms for five product tankers under bare
boat and ship management contracts. As per their last public announcement,
Pemex will receive bids at the end of May and will award these five-year
contracts in June. If we were to be awarded with any of these contracts, we
would acquire the necessary vessels with proceeds form the third tranche."
Serrano continued, "At Logistics, our trucking division showed improvement.
Gross profit improved $0.6 million from a loss of $0.3 million in the first
quarter of 2007 to a profit of $0.3 million in the first quarter of 2008.
The average age of our current trucking fleet is five years, which will
result in lower maintenance requirements and higher fuel efficiency,
thereby improving profit. Our warehousing business continues to show growth
quarter over quarter. However, overall results in the Logistics division
were impacted by operating costs and expenses in the auto hauling business
and by decreased sales in the automobile industry. As we complete the
modernization and rehabilitation of equipment in this business, we expect
to generate sustainable profit.
"On the financial costs side, the Company continues to pursue alternatives
to extend the maturity and reduce the cost of its corporate debt. We
believe every quarter we are closer to our goal."
Serrano concluded, "With continued improvement in consolidated operating
profit, the acquisition of additional vessels with contracted revenues in
our Maritime division, new equipment and new clients in place at our
Logistics division and all our efforts to reduce financial and corporate
costs throughout this year, we continue to build a solid platform for
profit and growth."
FINANCIAL RESULTS
Comparing the first quarter of 2008 with the same period of 2007,
consolidated revenues improved, specifically at Maritime and Logistics,
mainly due to higher volumes. Increased consolidated transportation income
for the first quarter of 2008 was mainly due to an improvement of $2.1
million at the Maritime division compared to the same period last year.
Costs and operating expenses of $68.8 million in the first quarter of 2008
increased 28.4 percent, from $53.6 million in the same period of last year.
The increase in the first quarter of 2008 was impacted by the appreciation
of the peso versus the dollar, by increased revenues, by an increase of
$5.9 million of costs in vessel leases due to additional vessels in
operation, and by costs related to the Company's auto hauling business.
Corporate expenses in the first quarter of 2008 were impacted by the
appreciation of the peso versus the dollar. The ratio of corporate expenses
to total revenue decreased to 5.4 percent in the first quarter of 2008
compared to 6.7 percent in the same period last year.
Other expense, net was $0.9 million in the first quarter of 2008, composed
mainly of a non-recurring restructuring cost of $0.4 million and other
related expenses.
Net financial cost in the first quarter of 2008 was $16.4 million,
increasing $5.8 million compared to $10.6 million incurred in the same
period of 2007. This increase was mainly due to a $6.8 million net increase
in interests attributable to a higher balance of debt including the first
issuance of Trust Certificates and to a $1.1 million increase in exchange
loss due to the appreciation of the peso versus the dollar in the first
quarter of 2008, partially reduced by an interest decrease of $2.1 million
resulting from a prepayment of $50 million of the securitization facility.
BALANCE SHEET
Investments in Fixed Assets
As of March 31, 2008, the Company invested $54.4 million in fixed assets,
which included: $36.5 million in the acquisition of one offshore vessel,
$14.7 million in the acquisition of two tugboats, $2.4 million in the
rehabilitation of the Company's facilities at Ciudad del Carmen and $0.8
million in Logistics related assets. As of March 31, 2008, the total market
value of the Company's maritime assets is estimated to exceed their book
value by $95 million.
Debt
As of March 31, 2008, TMM's total book value of debt was $508.6 million.
This debt is supported by approximately $412 million of long-term
contracted revenues.
Total Net Debt as of March 31, 2008 (1)
(Millions of dollars)
Trust Certificates (2) $273.5
Securitization Facility 124.2
Vessels (3) 91.1
Other Corporate Debt 19.8
Total Debt (4) 508.6
------
Cash on hand 56.8
------
Total Net Debt $451.8
(1) Book value of debt
(2) 20-year term peso denominated debt, non recourse to the Company
and rated AA (mex) by Fitch Ratings.
(3) Includes two chemical tankers, two tugboats and one offshore vessel
(4) Includes $10.8 million of accrued unpaid interest and is reduced by
$24.8 million of issuance related expenses
SEGMENT RESULTS
Maritime
Comparing the first quarter of 2008 with the first quarter of 2007:
-- Revenues improved 16.7 percent to $48.9 million compared to $41.9
million. Revenues increased at all businesses: in the offshore segment due
to an improved revenue mix -- in the product tanker segment as a result of
operating two additional vessels, in the harbor towage segment due to
increased volumes and to operating two additional vessels, and in the
chemical tanker segment due to a better freight mix and increased tonnage
per trip.
-- Transportation income improved 19.6 percent to $13.4 million compared
to $11.2 million due to profit improvements at all business segments. At
the chemical tanker segment, gross profit increased 226 percent to $1.4
million due to operating two owned vessels that were leased in the first
quarter of 2007, thereby reducing operating costs.
-- EBITDA of $18.8 million compared to $16.1 million
Logistics
Comparing the first quarter of 2008 with the first quarter of 2007:
-- Revenues improved 38.2 percent to $33.3 million compared to $24.1
million. Revenues increased at the trucking segment due to improved freight
volumes and to longer hauls, at inbound logistics attributable to higher
volumes, and in warehousing operations due to higher inventories. Auto
hauling contributed $5.7 million of revenues. Maintenance and repair
revenues decreased in the first quarter due to a reduction of container
volumes, particularly at a yard facility at Veracruz.
-- Transportation loss of $1.7 million compared to a transportation loss
of $1.3 million, impacted by $5.5 million of costs and operating expenses
at the auto hauling business segment, which mainly included fuel,
maintenance of equipment and personnel costs, and to a gross loss in
inbound logistics due to delays in assembly lines.
-- EBITDA of $0.6 million compared to a loss of $0.2 million
Ports and Terminals
Comparing the first quarter of 2008 with the first quarter of 2007:
-- Revenues decreased $0.3 million to $2.4 million compared to $2.7
million. This decrease was mainly due to a reduction of revenues in the
cruise ship segment at Acapulco due to a change of routes of two major
liners and to lower revenues at the shipping agencies segment. As a result,
transportation income decreased $0.3 million to $0.7 million.
-- EBITDA of $0.9 million compared to $1.3 million
EBITDA COMPARISON BY SEGMENT
(Millions of US dollars)
Q1 2008 Q1 2007
------- -------
Maritime $ 18.8 $ 16.1
Logistics 0.6 (0.2)
Ports 0.9 1.3
Corporate and others (4.1) (4.4)
------- -------
Total $ 16.2 $ 12.8
CONFERENCE CALL
TMM's management will host a conference call and Webcast to review
financial and operational highlights on Tuesday, April 29 at 11:00 a.m.
Eastern Time.
To participate in the conference call, please dial (877) 888-4605
(domestic) or (416) 695-6320 (international) at least five minutes prior to
the start of the event. Accompanying visuals and a simultaneous Webcast of
the meeting will be available at
http://www.visualwebcaster.com/event.asp?id=47248.
A replay of the conference call will be available through May 6 at 11:59
p.m. Eastern time, by dialing (800) 408-3053 or (416) 695-5800, and
entering conference ID 626804. On the Internet a replay will be available
for 30 days at http://www.visualwebcaster.com/event.asp?id=47248.
Headquartered in Mexico City, TMM is a Latin American intermodal
transportation company. Through its branch offices and network of
subsidiary companies, TMM provides a dynamic combination of ocean and land
transportation services. Visit TMM's Web site at www.grupotmm.com. The site
offers Spanish/English language options.
Included in this press release are certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such forward-looking statements speak only as of the date they are
made and are based on the beliefs of the Company's management as well as on
assumptions made. Actual results could differ materially from those
included in such forward-looking statements. Readers are cautioned that all
forward-looking statements involve risks and uncertainty. The following
factors could cause actual results to differ materially from such
forward-looking statements: global, US and Mexican economic and social
conditions; the effect of the North American Free Trade Agreement on the
level of
US-Mexico trade; the condition of the world shipping market; the success of
the Company's investment in new businesses; risks associated with the
Company's reorganization and restructuring; the ability of the Company to
reduce corporate overhead costs; the ability of management to manage growth
and successfully compete in new businesses; and the ability of the Company
to restructure or refinance its indebtedness. These risk factors and
additional information are included in the Company's reports on Form 6-K
and 20-F on file with the United States Securities and Exchange Commission.
Grupo TMM, S.A.B. and subsidiaries
* Balance Sheet (under discontinuing operations)
- millions of dollars -
--------------------------
March 31, December 31,
2008 2007
--------------------------
Current assets:
Cash and cash equivalents 56.830 52.235
------------ ------------
Accounts receivable
Accounts receivable - Net 50.908 44.812
------------ ------------
Other accounts receivable 39.180 32.698
------------ ------------
Prepaid expenses and others current assets 15.159 12.506
------------ ------------
Total current assets 162.077 142.251
============ ============
Property, machinery and equipment 502.937 453.069
------------ ------------
Cumulative Depreciation (114.137) (108.830)
------------ ------------
Property, machinery and equipment - Net 388.800 344.239
============ ============
Other assets 60.113 59.866
============ ============
Deferred taxes 115.818 115.818
============ ============
Total assets 726.808 662.174
============ ============
Current liabilities:
Bank loans and current maturities of long-term
liabilities 33.596 17.787
------------ ------------
Sale of accounts receivable 13.869 13.463
------------ ------------
Suppliers 35.149 28.660
------------ ------------
Other accounts payable and accrued expenses 47.044 40.127
------------ ------------
Total current liabilities 129.658 100.037
============ ============
Long-term liabilities:
Bank loans and other obligations 350.857 303.229
------------ ------------
Sale of accounts receivable 110.292 113.362
------------ ------------
Other long-term liabilities 27.303 26.684
------------ ------------
Total long-term liabilities 488.452 443.275
============ ============
Total liabilities 618.110 543.312
============ ============
Stockholders' equity
Common stock 120.998 121.094
------------ ------------
Retained earnings 1.609 11.885
------------ ------------
Initial accumulated translation loss (17.757) (17.757)
------------ ------------
Cumulative translation adjusted (1.924) (2.263)
102.926 112.959
------------ ------------
Minority interest 5.772 5.903
------------ ------------
Total stockholders' equity 108.698 118.862
============ ============
Total liabilities and stockholders' equity 726.808 662.174
============ ============
*Prepared in accordance with International Financial Reporting Standards.
Grupo TMM, S.A.B. and subsidiaries
* Statement of Income (under discontinuing operations)
- millions of dollars -
--------------------------
Three months ended
March 31,
2008 2007
--------------------------
Ports 2.431 2.734
Maritime 48.953 41.884
Logistics 33.318 24.085
Corporate and others 1.215 (0.084)
------------ ------------
Revenue from freight and services 85.917 68.619
------------ ------------
Ports (1.556) (1.529)
Maritime (31.924) (27.229)
Logistics (33.837) (24.919)
Corporate and others (1.538) 0.093
------------ ------------
Cost of freight and services (68.855) (53.584)
------------ ------------
Ports (0.216) (0.192)
Maritime (3.625) (3.403)
Logistics (1.218) (0.425)
Corporate and others (0.003) (0.004)
------------ ------------
Depreciation of vessels and equipment (5.062) (4.024)
------------ ------------
Corporate expenses (4.606) (4.616)
------------ ------------
Ports 0.659 1.013
Maritime 13.404 11.252
Logistics (1.737) (1.259)
Corporate and others (4.932) (4.611)
------------ ------------
Transportation Income 7.394 6.395
------------ ------------
Other (expenses) income - Net (0.899) 0.108
------------ ------------
Operating Income 6.495 6.503
============ ============
Financial (expenses) income - Net (14.512) (9.838)
------------ ------------
Exchange (loss) gain - Net (1.890) (0.782)
------------ ------------
Net financial cost (16.402) (10.620)
------------ ------------
Loss before taxes (9.907) (4.117)
============ ============
Provision for taxes (0.569)
------------ ------------
Net loss for the period (9.907) (4.686)
============ ============
Attributable to:
Minority interest 0.372 0.374
Equity holders of GTMM, S.A.B. (10.279) (5.060)
============ ============
Weighted average outstanding shares (millions) 56.897 56.963
Loss earnings per share (dollars / share) (0.181) (0.089)
Outstanding shares at end of period (millions) 56.888 56.963
Loss earnings per share (dollars / share) (0.181) (0.089)
============ ============
*Prepared in accordance with International Financial Reporting Standards.
Grupo TMM, S.A.B. and subsidiaries
* Statement of Cash Flow (under discontinuing operations)
- millions of dollars -
--------------------------
Three months ended
March 31,
2008 2007
--------------------------
Cash flow from operation activities:
Net loss before discontinuing operations (9.907) (4.686)
------------ ------------
Charges (credits) to income not affecting
resources:
Depreciation & amortization 8.766 6.363
------------ ------------
Other non-cash items 9.610 10.058
------------ ------------
Total non-cash items 18.376 16.421
------------ ------------
Changes in assets & liabilities 7.110 2.279
------------ ------------
Total adjustments 25.486 18.700
------------ ------------
Net cash provided by operating activities 15.579 14.014
============ ============
Cash flow from investing activities:
Proceeds from sales of assets 0.038 0.620
------------ ------------
Payments for purchases of assets (54.390) (32.445)
------------ ------------
Acquisition of shares of subsidiaries 28.275
------------ ------------
Common stock decrease of subsidiaries (0.490)
------------ ------------
Net cash used in investment activities (54.842) (3.550)
============ ============
Cash flow provided by financing activities:
Short-term borrowings (net) 2.743 5.396
------------ ------------
Sale (repurchase) of accounts receivable
(net) (7.296) (10.108)
------------ ------------
Repayment of long-term debt (4.744) (10.507)
------------ ------------
Proceeds from issuance of long-term debt 53.250
------------ ------------
Sale (Acquisition) of treasury shares, net (0.095)
------------ ------------
Net cash provided (used in) by financing
activities 43.858 (15.219)
============ ============
Net increase (decrease) in cash 4.595 (4.755)
------------ ------------
Cash at beginning of period 52.235 38.666
------------ ------------
Cash at end of period 56.830 33.911
============ ============
*Prepared in accordance with International Financial Reporting Standards.
Contact Information: TMM COMPANY CONTACT: Jacinto Marina Chief Financial Officer 011-525-55-629-8866 ext. 2901 Monica Azar Investor Relations 917-597-5361 or 011-525-55-629-8866 ext. 3421 AT DRESNER CORPORATE SERVICES: Kristine Walczak (investors, analysts, media) 312-726-3600