Investor: Patrick Fossenier 1+ 734-757-1557
News Media: Gary Frantz 1+ 734-757-1558
ANN ARBOR, Mich. - February 05, 2014
Con-way Inc. (NYSE:CNW) today reported 2013 fourth-quarter net income of $11.7 million, or 20 cents per diluted share, which was in line with the company’s fourth quarter update previously issued in mid-January. The results compare to fourth-quarter 2012 net income of $11.8 million, or 21 cents per diluted share.
On a non-GAAP basis, earnings per diluted share were 23 cents in the 2013 fourth quarter compared to 26 cents in last year’s fourth quarter. (Non-GAAP items, consisting solely of tax-related adjustments, are detailed in the attached reconciliation.)
Operating income in the fourth quarter was $33.4 million compared to $37.8 million earned in the fourth quarter a year ago. Revenue for the fourth quarter was $1.36 billion, unchanged from last year’s fourth quarter.
Con-way’s fourth-quarter effective tax rate was 45.3 percent, compared to 50.2 percent for the same period in 2012. The fourth-quarter tax provision in both years included increased state and foreign income taxes. Both years also included discrete tax adjustments. Excluding these items (see the attached reconciliation) the fourth-quarter effective tax rate would have been 38.9 percent in 2013 compared to 38.7 percent in 2012.
Commenting on the company’s results, Douglas W. Stotlar, Con-way’s president and CEO, said “As reported earlier, Con-way Freight and Menlo Worldwide Logistics dealt with a number of issues in the fourth quarter, which negatively affected the period’s operating results and were mostly specific to the quarter,” Stotlar explained.
“These results were not indicative of the overall progress made in 2013 to position our company for long-term success, notably at Con-way Freight and Menlo Logistics,” he continued. “At our less-than-truckload company, we deployed foundational capabilities including lane-based pricing, line-haul optimization tools, and the broader rollout of Lean methodologies. Our logistics company invested in its sales and solution capabilities, facilitating its expansion into new industries. Looking ahead, while severe winter weather has disrupted the start to the year, we expect our progress to continue and our results to improve in 2014.”
For the full-year 2013, Con-way reported net income of $99.2 million, or $1.73 per diluted share, compared to full-year 2012 net income of $104.5 million, or $1.85 per diluted share.
On a non-GAAP basis, full-year earnings per diluted share were $1.66 in 2013 compared to $1.80 in 2012 (see attached reconciliation).
Operating income of $209.0 million in 2013 declined from the $228.8 million earned in 2012. Revenue for the full-year 2013 was $5.47 billion compared to $5.58 billion in 2012.
The full-year effective tax rate was 35.8 percent in 2013, compared to 38.8 percent in 2012. Both years included tax adjustments (see the attached reconciliation). Excluding the adjustments, the effective tax rate would have been 37.5 percent in 2013 and 39.0 percent in 2012.
Segment results in the fourth quarter for Con-way’s principal operations were as follows:
For the fourth quarter of 2013, Con-way Freight, the company’s less-than-truckload (LTL) operation, reported:
“As previously noted, we completed the rollout of several transformative projects designed to improve revenue management and operating efficiencies at Con-way Freight,” Stotlar said. “We expect these foundational initiatives to contribute to improved results in 2014.”
For the fourth quarter of 2013, Menlo Worldwide Logistics, the company’s global logistics and supply chain management operation, reported:
“The operating issues which led to the losses at the warehousing accounts have been substantially addressed,” Stotlar said. “With last year’s surge in start-up expenses largely behind us, we expect Menlo to deliver improved results in 2014.”
For the fourth quarter of 2013, Con-way Truckload reported:
“Our truckload company delivered a solid fourth quarter, despite some declines in productivity due to the adverse weather in December,” Stotlar said. “Demand picked up as the quarter progressed, which aided asset utilization and network density. With improving demand trends adding stability to the pricing environment, Con-way Truckload is well positioned going into 2014,” he concluded.
Corporate and Eliminations includes the company’s trailer manufacturing unit as well as other corporate activities. These activities produced operating losses of $2.0 million in the fourth quarter of 2013 and $0.8 million in the fourth quarter of 2012.
INVESTOR CONFERENCE CALL
Con-way will host a conference call for the investment community tomorrow, Thursday, February 6, beginning at 8:30 a.m. Eastern Time. The call can be accessed by dialing (877) 874-4749 or (706) 643-3632 (for international callers) and is expected to last approximately one hour. The call will also be available through a live internet webcast at www.con-way.com, in the investors section.
An audio replay will be available for two weeks following the call by dialing (855) 859-2056 or (404) 537-3406 (for international callers) and using access code 31372668. An Internet replay and podcast of the presentation will also be available at the Con-way site.
ABOUT CON-WAY INC.
Con-way Inc. (NYSE:CNW) is a $5.5 billion freight transportation and logistics services company headquartered in Ann Arbor, Mich. Con-way delivers industry-leading services through its primary operating companies of Con-way Freight, Con-way Truckload and Menlo Worldwide Logistics. These operating units provide high-performance, day-definite less-than-truckload (LTL), full truckload and multimodal freight transportation, as well as logistics, warehousing and supply chain management services. Con-way also operates a trailer refurbishing and manufacturing company which supplies trailing equipment to the company’s trucking fleets. Con-way Inc. and its subsidiaries operate from more than 500 locations across North America and in 20 countries. For more information about Con-way, visit www.con-way.com.
Certain statements in this press release constitute "forward-looking statements" and are subject to a number of risks and uncertainties and should not be relied upon as predictions of future events. All statements other than statements of historical fact are forward-looking statements, including: any projections of earnings, revenues, weight, yield, volumes, income or other financial or operating items, all statements of the plans, strategies, expectations or objectives of Con-way’s management for future operations or other future items, any statements concerning proposed new products or services, any statements regarding Con-way's estimated future contributions to pension plans, any statements as to the adequacy of reserves, any statements regarding the outcome of any legal and other claims and proceedings that may be brought by or against Con-way, any statements regarding future economic conditions or performance, any statements regarding strategic acquisitions, any statements of estimates or belief, and any statements or assumptions underlying the foregoing. Specific factors that could cause actual results and other matters to differ materially from those discussed in such forward-looking statements include: changes in general business and economic conditions, increasing competition and pricing pressure, the creditworthiness of Con-way's customers and their ability to pay for services rendered, changes in fuel prices or fuel surcharges, the possibility that Con-way may, from time to time, be required to record impairment charges for goodwill, intangible assets and other long-lived assets, the possibility of defaults under Con-way's revolving credit agreement and other debt instruments (including without limitation defaults resulting from unusual charges), uncertainty in the credit markets, including the effect on Con-way’s ability to refinance indebtedness as and when it becomes due, labor matters, enforcement of and changes in governmental regulations or legislation which potentially could result in an adverse impact on the company, environmental and tax matters, and matters relating to Con-way's defined benefit pension plans, including the effect on the plans of changes in discount rates and in the value of plan assets. The factors included herein and in Item 1A of Con-way's 2012 Annual Report on Form 10-K as well as other filings with the Securities and Exchange Commission could cause actual results and other matters to differ materially from those in such forward-looking statements. As a result, no assurance can be given as to future financial condition, cash flows, or results of operations. Any forward-looking statements speak as of the date of this news release and are subject to change. Con-way does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as otherwise required by law.