SOURCE: Swift Transportation

October 09, 2006 20:58 ET

Swift Transportation Co., Inc. Updates 2006 Third Quarter Earnings Expectations

PHOENIX, AZ -- (MARKET WIRE) -- October 9, 2006 -- Swift Transportation Co., Inc. (NASDAQ: SWFT), in an update of its September 28, 2006 announcement, today increased its previous net earnings guidance for the quarter ended September 30, 2006. The Company now expects net earnings for the quarter to be between $0.50 and $0.52 per share, before taking into account one-time, pre-tax impairment charges of $9.2 million as discussed below. The Company expects net earnings for the quarter to be between $0.42 and $0.44 per share after taking into account the one-time impairment.

The increased estimate was driven primarily by two factors identified as part of the Company's closing process for the third quarter. First, the rapid decline in fuel prices in September resulted in better Company performance than previously anticipated. Secondly, due to continued benefits from the Company's workers' compensation claims management initiatives, workers' compensation expense was significantly less than expected. This improvement was confirmed based on actuarial data reviewed as part of the normal closing process. These two factors reduced expenses for the quarter by an amount sufficient to offset the negative impact of softness in the truckload freight environment and the driver shortage that we discussed in the September 28th press release.

Also, as discussed in its September 28th announcement, the Company recorded a one-time pre-tax impairment charge of $7.8 million for its translucent trailers previously designated as assets held for sale related to the deterioration in their market value. The Company plans to sell these trailers over the next twelve months. In addition, the Company recorded a pre-tax impairment of $1.4 million related to assets in Mexico.

Swift will release final earnings for the third quarter ended September 30, 2006, after the close of trading on Wednesday, October 25, 2006. The Company will hold a live conference call and webcast with a slide presentation to discuss its earnings release on Thursday, October 26, 2006, at 10:00 a.m. Eastern time. Individuals with questions in the U.S. and Canada may dial in at (866) 413-2055. International callers with questions may dial in at (706) 758-4456. The Conference ID is 7723045. For others, the conference call will be broadcast live on the Internet at http://www.earnings.com/. The slide presentation may be accessed through the company's website, http://www.swifttrans.com/ on the Investor Relations tab under the Financial Reports and Presentations link. Replays will be available on these Web sites for two weeks.

Swift is the holding company for Swift Transportation Co., Inc., a truckload carrier headquartered in Phoenix, Arizona. Swift's trucking subsidiary operates the largest fleet of truckload carrier equipment in the United States with regional operations throughout the continental United States.

Forward-looking statement disclosure:

This press release contains statements that may constitute forward-looking statements, usually identified by words such as "anticipates," "believes," "estimates," "projects," "expects," "intends" or similar expressions which speak only as of the date the statement was made. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Such statements include, but are not limited to, statements concerning our expectation of earnings for the quarter ended September 30, 2006. Such statements are based upon the current beliefs and expectations of Swift's management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements.

As to Swift's business and financial performance, the following factors, among others, could cause actual results to differ materially from those in forward-looking statements: completion of our quarterly review process; prevailing market conditions relating to our determination of the fair value of assets held for sale and related impairment charges; adverse developments in our relationship with IEL and, by extension, owner-operators whose tractors are financed by IEL; the impact of our new owner-operator fuel surcharge reimbursement program on operating results; excess capacity in the trucking industry; significant increases or rapid fluctuations in fuel prices, interest rates, fuel taxes, tolls, license and registration fees, insurance premiums and driver compensation, to the extent not offset by increases in freight rates or fuel surcharges; recessionary economic cycles and downturns in customers' business cycles, particularly in market segments and industries (such as retail and manufacturing) in which Swift has a significant concentration of customers; seasonal factors such as harsh weather conditions that increase operating costs; continuing difficulties in driver recruitment or retention issues involving Company drivers and/or owner operators; increases in driver compensation to the extent not offset by increases in freight rates; the inability of Swift to continue to secure acceptable financing arrangements; an adverse determination by the FMSCA with respect to Swift's safety rating and any resulting loss of customers or potential customers or a material increase in insurance costs; an unanticipated increase in the number or dollar amount of claims for which Swift is self insured; fluctuations in workers' compensation claims, which have benefited recent operating results due to improved claims management, but are not expected to continue at such levels in future periods; competition from trucking, rail and intermodal competitors; our ability to sell assets held for sale at or above their net book value; the potential impact of current litigation, regulatory issues, or other government actions; a possible adverse impact on the trading price of the Company's common stock as a result of the adoption of the Stockholders Protection Agreement; and a significant reduction in or termination of Swift's trucking services by a key customer.

A discussion of these and other factors that could cause Swift's results to differ materially from those described in the forward-looking statements can be found in the most recent Annual Report on Form 10-K of Swift, filed with the Securities and Exchange Commission and available at the Securities and Exchange Commission's internet site (http://www.sec.gov). Swift undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Furthermore, nothing herein shall constitute an adoption or approval of any analyst report regarding Swift, nor any undertaking to update or comment upon analysts' expectations in the future.

Contact Information

  • Contact:
    Glynis Bryan
    CFO
    Swift Transportation Co., Inc.
    (602) 269-9700