SOURCE: Integrated Freight Corporation

Integrated Freight Corporation

November 25, 2011 09:00 ET

Integrated Freight Announces Fiscal Second Quarter 2012 Financial Results

Strong Sales Growth and Cash Flow From Operations Driven by Successful Acquisition & Integration Strategy

SARASOTA, FL--(Marketwire - Nov 25, 2011) - Integrated Freight Corporation ("Integrated Freight" or the "Company") (OTCQB: IFCR) (OTCBB: IFCR), a rapidly growing motor freight company providing long-haul, regional and local service to its customers in the U.S., today announced its financial results for its fiscal second quarter and six months ended September 30, 2011.

Fiscal Second Quarter and Six Month Highlights

  • Revenue for the second quarter increased 144.7% to $11.8 million
  • Revenue for the six months ended September 30, 2011 increased 158.6% to $24.8 million
  • Net cash provided by operating activities for the six months ended September 30, 2011 increased sharply to $946,485 versus $109,430 for the same period last year

"We achieved strong revenue growth for the second quarter and first half of the year as we better positioned the business for growth," stated Paul Henley, Chief Executive Officer of Integrated Freight. "Our net cash flow from operations increased significantly to $946,485 in the first half compared to $109,430 in the same period last year. Our strong cash flow from operations will allow us to finance our organic growth as we evaluate strategic acquisitions in our industry. During the first half of the year, we completed the acquisition of Cross Creek Trucking, our fourth subsidiary company, and saw increases in freight revenue and are encouraged by our profitability with Integrated Freight Services, our freight brokerage that we launched in March."

Fiscal Second Quarter Results

Revenues for the fiscal second quarter ended September 30, 2011 increased 144.7% to $11.8 million from $4.8 million in the same quarter last year. The increase is due primarily to the acquisition of Cross Creek Trucking, Inc. on April 1, 2011, positive effects from the Company's growing brokerage operations, and an increase in freight revenue in correlation to the U.S. economy.

Operating expenses for the fiscal second quarter ended September 30, 2011 increased 132.5% to $11.8 million compared to $5.1 million for the three months ended September 30, 2010. The increase was less than the increase in revenue for the quarter and is due to increased fuel costs and transaction costs in connection with the acquisition of Cross Creek Trucking as well as higher wages, salaries and benefits and General and Administrative expenses. General and administrative costs for the three months ended September 30, 2011 increased 147% to $1.2 million compared to $468,902 for the same period a year ago. Fuel and fuel taxes for the three months ended September 30, 2011 increased 227.1% to $4.0 million, compared to $1.2 million for the three months ended September 30, 2010. Wages, salaries and benefits increased 188.5% to $3.8 million for the three months ended September 30, 2011 compared to $1.3 million for the same period last year.

The Company reported a net loss of $1.4 million for the fiscal second quarter ended September 30, 2011, or $0.04 per diluted share, compared to a net loss of $ 301,795, or $0.01 per diluted share, for the three months ended September 30, 2010, an increase of $1.1 million. The increase was primarily due to fuel cost increases, higher expenses associated with the acquisition of Cross Creek Trucking, Inc. and higher operating and interest expenses.

Six Month Results

Revenue for six months ended September 30, 2011 increased 158.6% to $24.8 million from $9.6 million in the six months ended September 30, 2010. Operating expenses for the six months ended September 30, 2011 increased 162.6% to $26.7 million compared to $10.2 million for the six months ended September 30, 2010. Operating loss for the six months ended September 30, 2011 widened to $1.9 million from $566,342 for the six months ended September 30, 2010. The increase was due to the acquisition of Cross Creek Trucking, Inc. and included $795,000 of transactions costs related to the acquisition as well as an increase in fuel costs. The Company reported a net loss of $4.3 million for the six months ended September 30, 2011, or $0.12 per diluted share, compared to a net loss of $854,088, or $0.04 per diluted share, for the six months ended September 30, 2010, an increase of $3.4 million.

Financial Condition

As of September 30, 2011, the Company had no cash nor cash equivalents versus cash and cash equivalents of $54,158 as of March 31, 2011. Total liabilities and stockholders' deficit was $19.1 million as of September 30, 2011 versus total liabilities and stockholders' deficit of $7.8 million for the period ended March 31, 2011. Net cash provided by operating activities for the six months ended September 30, 2011 was $946,485 compared to $109,430 for the six months ended September 30, 2010.

Business Outlook

"We are confident about the prospects for our business for the remainder of the year as we execute our growth and integration strategy," stated Mr. Henley. "We made considerable strides in the first half of the year. We are achieving cost savings and efficiencies through the elimination of overlapping lanes, better customer utilization and lowering our fleet maintenance costs through bulk buying and nationwide service contracts. Our network of subsidiary companies is benefitting from our state-of-the-art trucking technology platform, which is helping us run more efficiently while controlling overhead. We are excited by the growth prospects for our business going forward and see solid opportunities to acquire additional niche trucking players and integrate them into our growing network."

About Integrated Freight Corporation

Integrated Freight Corporation (OTCBB: IFCR) is a Sarasota, Florida headquartered motor freight company providing long-haul, regional and local service to its customers. The Company specializes in dry and refrigerated truckload services, operating primarily in well-established traffic lanes in the Upper Midwest, Pacific Northwest, Texas, California and the Atlantic seaboard. Integrated Freight was formed for the purpose of acquiring and consolidating operating motor freight companies and incorporated in the state of Florida in 2008. Integrated Freight's mission is to build a safe, reliable, high-quality national freight carrier and customized logistics service with a diverse customer base that is well-positioned in growing profitable markets. For more information, please visit http://www.integrated-freight.com.

To be added to the Company's email distribution for future news releases, please send your request to andrew@hamptongrowth.com.

Safe Harbor Statement

The foregoing press release contains forward-looking statements, including statements regarding the company's expectation of its future business and earnings, subject to the safe-harbor provisions for forward-looking statements provided in the Securities Exchange Act and the regulations there under. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond the company's control. Actual results could differ materially from these forward-looking statements. Additional risks that could affect our future operating results are more fully described in our filings with United States Securities and Exchange Commission. These filings are available at www.sec.gov.

We may, from time to time, make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statements that may be made from time to time by us or on our behalf.

INTEGRATED FREIGHT CORPORATION
Consolidated Statements of Operations
(Unaudited) (Unaudited)
Three Months Ended Six Months Ended
September 30, September 30,
2011 2010 2011 2010
Revenue $ 11,788,506 $ 4,817,249 $ 24,824,586 $ 9,598,297
Operating Expenses
Rents and transportation 1,930,753 1,226,521 3,960,234 2,262,307
Wages, salaries and benefits 3,795,945 1,315,857 7,811,498 2,641,756
Fuel and fuel taxes 4,018,311 1,228,521 8,941,850 2,649,018
Depreciation and amortization 546,246 600,959 1,807,582 1,181,739
Insurance and claims 130,478 200,621 410,049 392,243
Operating taxes and licenses 264,501 52,562 682,904 93,466
General and administrative 1,158,311 468,902 3,078,177 944,110
Total Operating Expenses 11,844,545 5,093,943 26,692,294 10,164,639
Loss from continuing operations (56,039 ) (276,694 ) (1,867,708 ) (566,342 )
(Loss)/Gain from discontinued operations (0 ) 130,938 (420,756 ) 141,920
Other Income (Expense)
Gain/(loss) on change of fair value of derivative liability 207,936 - 181,119 (60,000 )
Interest (1,196,127 ) (138,900 ) (2,129,945 ) (480,432 )
Interest - related parties (136,815 ) (47,329 ) (19,848 ) (87,227 )
Other income (expense) (220,614 ) 20,851 (21,737 ) 182,963
Total Other Income (Expense) (1,345,620 ) (165,378 ) (1,990,411 ) (444,696 )
Net loss before noncontrolling interest (1,401,659 ) (311,134 ) (4,278,875 ) (869,118 )
Noncontrolling interest share of subsidiary net income (loss) 3,804 9,339 13,247 15,030
Net loss $ (1,397,855 ) $ (301,795 ) $ (4,265,628 ) $ (854,088 )
Net loss per share - basic and diluted
Loss from continuing operations $ (0.03 ) $ (0.00 ) $ (0.11 ) $ (0.05 )
Loss from discontinued operations (0.01 ) 0.01 (0.01 ) 0.01
Net loss per common share-basic and diluted $ (0.04 ) $ (0.01 ) $ (0.12 ) $ (0.04 )
Weighted average common shares outstanding - basic and diluted 37,935,422 22,166,759 36,332,331 21,089,749
See notes to consolidated financial statements.
INTEGRATED FREIGHT CORPORATION
Consolidated Balance Sheets
September 30, 2011(Unaudited) March 31, 2011
Assets
Current assets:
Cash $ - $ 54,158
Accounts receivables, net of allowance for doubtful accounts of $50,000 4,620,823 2,564,352
Prepaid expenses and other assets 702,701 545,930
Total current assets 5,323,524 3,164,440
Property and equipment, net of accumulated depreciation 12,278,607 4,141,068
Intangible assets, net of accumulated amortization 1,425,093 268,785
Assets of discontinued operations 28,469 236,279
Total assets $ 19,055,693 $ 7,810,572
Liabilities and Stockholders' Deficit
Current liabilities:
Bank overdraft $ 453,941 $ 214,303
Accounts payable 1,991,360 1,151,337
Accrued expenses and other liabilities 4,261,978 1,112,778
Line of credit 2,237,565 895,153
Notes payable - related parties 1,150,775 1,180,987
Current portion of notes payable 5,846,300 2,709,111
Total current liabilities 15,941,919 7,263,669
Derivative liability 124,352 513,471
Notes payable - related parties 4,007,633 120,000
Notes payable, net of current portion and debt discount 4,957,667 4,235,242
Liabilities of discontinued operations 1,893,269 1,765,313
Total long-term liabilities 10,982,921 6,634,026
Total liabilities 26,924,840 13,897,695
Stockholders' deficit:
Common stock, $0.001 par value, 2,000,000,000 shares authorized, 38,472,089 and 31,574,883 shares issued and outstanding at June 30, 2011 and March 31, 2011, respectively 38,471 31,575
Additional paid-in capital 8,490,614 6,013,911
Accumulated deficit (16,754,409 ) (12,475,539 )
Total Integrated Freight Corporation stockholders' deficit (8,225,324 ) (6,430,053 )
Non controlling interest 356,177 342,930
Total stockholders' deficit (7,869,147 ) (6,087,123 )
Total liabilities and stockholders' deficit $ 19,055,693 $ 7,810,572
See notes to consolidated financial statements.
INTEGRATED FREIGHT CORPORATION
Consolidated Statements of Cash Flows
Six Months Ended
September 30,
(Unaudited)
Cash flows from operating activities: 2011 2010
Net loss $ (4,278,875 ) $ (854,088 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization 1,807,582 1,181,739
Debt discount amortization 49,597 169,012
Common stock issued in payment of derivative 208,000 -
Derivative liability (389,119 ) 60,000
Warrants issued for interest 101,280 -
Loss on asset dispositions 449,982 6,744
Noncontrolling interest in earnings of subsidiary 13,247 (15,030 )
Stock issued for stock based compensation 6,500 5,746
Warrants issued for services performed 79,600 -
Stock issued for interest 293,219 -
Stock issued for services 322,500 -
Loss from discountinued operations 420,756 -
Increases/decreases in operating assets and liabilities -
Accounts receivable 38,623 (330,013 )
Prepaid expenses and other assets (75,285 ) (26,842 )
Accounts payable (41,128 ) 57,677
Accrued and other liabilities 1,940,006 (41,093 )
Net cash (used) in/provided by operating activities 946,485 213,852
Cash flows from investing activities:
Trade-in of property and equipment - 50,760
Purchase of discontinued operations-Triple C - (100,000 )
Net cash used in investing activities - (49,240 )
Cash flows from financing activities:
Repayments of notes payable (2,734,882 ) (715,374 )
Proceeds of notes payable 796,916 559,000
Net proceeds/(repayments) from line of credit 665,185 (5,143 )
Bank overdraft 239,638 85,565
Proceeds from exercise of warrants/sale of stock 32,500 5,000
Net cash (used) in/provided by financing activities (1,000,643 ) (70,952 )
Net change in cash (54,158 ) 93,660
Cash, beginning of period 54,158 48,101
Cash, end of period $ - $ 141,761
See notes to consolidated financial statements.