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Knight Transportation Reports Fourth Quarter And Annual 2012 Revenue And Earnings

The company will hold a conference call on January 30, 2013, at 4:30 PM EST, to further discuss its results of operations for the quarter ended December 31, 2012. The dial in number for this conference call is 1-855-733-9163. Slides to accompany this call will be posted on the company’s website and will be available to download prior to the scheduled conference time. To view the presentation, please visit http://investor.knighttrans.com/events, ''Fourth Quarter 2012 Conference Call Presentation.''

Knight Transportation, Inc. is a provider of multiple truckload transportation services using a nationwide network of service centers in the U.S. to serve customers throughout North America. In addition to operating one of the country’s largest tractor fleets, Knight also partners with third-party equipment providers to provide a broad range of truckload services to its customers while creating quality driving jobs for our driving associates and successful business opportunities for owner-operators.

INCOME STATEMENT DATA:       Three Months Ended December 31,       Twelve Months Ended December 31,
(Unaudited, in thousands, except per share amounts)
       

2012

2011

2012

2011

REVENUE:
Revenue, before fuel surcharge $ 195,164 $ 181,001 $ 752,151 $ 697,286
Fuel surcharge   47,139         43,099     183,885         168,913  
TOTAL REVENUE   242,303         224,100     936,036         866,199  
 
OPERATING EXPENSES:
Salaries, wages and benefits 60,046 56,467 238,266 218,686
Fuel expense - gross 56,781 56,968 230,178 226,471
Operations and maintenance 16,954 13,401 61,875 53,714
Insurance and claims 8,429 7,044 32,138 30,072
Operating taxes and licenses 4,180 3,973 16,184 15,212
Communications 1,299 1,437 5,172 5,534
Depreciation and amortization 21,925 19,891 85,056 75,832
Purchased transportation 41,008 33,600 148,022 129,143
Miscellaneous operating expenses   3,117         2,084     10,878         11,514  
  213,739         194,865     827,769         766,178  
Income From Operations   28,564         29,235     108,267         100,021  
 
Interest income 100 131 417 1,068
Interest expense (100 ) (131 ) (457 ) (180 )
Other income   1,120         271     1,550         279  
Income before income taxes 29,684 29,506 109,777 101,188
INCOME TAXES   11,620         11,800     45,014         40,480  
Net Income 18,064 17,706 64,763 60,708
Net income attributable to noncontrolling interest   (366 )       (237 )   (646 )       (460 )
NET INCOME ATTRIBUTABLE TO KNIGHT TRANSPORTATION $ 17,698       $ 17,469   $ 64,117       $ 60,248  
Net Income Per Share
- Basic $ 0.22 $ 0.22 $ 0.80 $ 0.74
- Diluted $ 0.22 $ 0.22 $ 0.80 $ 0.74
Weighted Average Shares Outstanding
- Basic 79,746 79,378 79,673 81,439
- Diluted 79,987 79,706 80,000 81,872
 
BALANCE SHEET DATA:

12/31/12

12/31/11

ASSETS (Unaudited, in thousands)
Cash and cash equivalents $ 5,684 $ 9,584
Accounts receivable, net 102,553 101,319
Notes receivable, net 791 1,034
Related party notes and interest receivable 2,814 2,868
Prepaid expenses 17,035 10,131
Assets held for sale 18,362 19,416
Other current assets 12,449 9,605
Income tax receivable - 3,821
Current deferred tax asset   3,409         2,319  
Total Current Assets 163,097 160,097
 
Property and equipment, net 584,064 547,033
Notes receivable, long-term 3,692 3,987
Goodwill 10,276 10,295
Other assets and restricted cash   21,383         16,171  
Total Long-term Assets 619,415 577,486
 
Total Assets $ 782,512       $ 737,583  
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $ 11,281 $ 14,322
Accrued payroll and purchased transportation 10,489 9,096
Accrued liabilities 16,020 13,645
Claims accrual - current portion 15,892 12,875
Dividend payable - current portion   141         77  
Total Current Liabilities 53,823 50,015
 
Claims accrual - long-term portion 10,340 8,693
Long-term dividend payable & other liabilities 2,638 1,457
Deferred income taxes 144,871 145,668
Long-term debt   80,000         55,000  
Total Long-term Liabilities 237,849 210,818
 
Total Liabilities   291,672         260,833  
 
 
Common stock 798 794
Additional paid-in capital 142,837 132,723
Accumulated other comprehensive income/(loss) (302 ) (448 )
Retained earnings   346,899         343,290  
Total Knight Transportation Shareholders' Equity 490,232 476,359
Noncontrolling interest   608         391  
Total Shareholders' Equity   490,840         476,750  
Total Liabilities and Shareholders' Equity $ 782,512       $ 737,583  
 
 
      Three Months Ended December 31,       Twelve Months Ended December 31,

2012

   

2011

   

%Change

2012

   

2011

   

%Change

(Unaudited) (Unaudited)
OPERATING STATISTICS

 

 

 

 

Average Revenue Per Tractor* $ 39,653 $ 39,974 -0.8 % $ 158,978 $ 157,076 1.2 %
 
Non-paid Empty Mile Percent 11.0 % 10.8 % 1.9 % 10.6 % 10.6 % 0.0 %
 
Average Length of Haul 480 468 2.6 % 482 483 -0.2 %
 
Operating Ratio** 85.4 % 83.8 % 85.1 % 85.7 %
 
Average Tractors - Total 4,178 3,963 4,096 3,908
 
Trailers - End of Quarter 9,564 8,986 9,564 8,986
 
Net Capital Expenditures (in thousands) $ 34,942 $ 40,327 $ 120,844 $ 138,308
 
Adjusted Cash Flow From Operations Excluding Change in Short-term Investments (in thousands) *** $ 44,142 $ 38,341 $ 150,820 $ 136,318
 
* Includes dry van, refrigerated, and port services revenue excluding fuel surcharge, brokerage revenue, intermodal revenue, and other revenue.
 
** Operating ratio as reported in this press release is based upon total operating expenses, net of fuel surcharge, as a percentage of revenue before fuel surcharge. Operating ratio reported for the twelve months ending December 31, 2012 is based upon total operating expenses, excluding the first quarter 2012 one time non-cash stock compensation charge of $4 million related to the accelerated vesting of certain stock options issued prior to 2009, and net of fuel surcharge, as a percentage of revenue before fuel surcharge. We measure our revenue, before fuel surcharge, and our operating expenses, net of fuel surcharge, because we believe that eliminating this sometimes volatile source of revenue affords a more consistent basis for comparing our results of operations from period to period.
 
*** No adjustment was made to the twelve-month period ended December 31, 2012 adjusted cash flow from operations of $150,820 as there was no change in short-term trading investments. Adjusted cash flow from operations of $136,318 for the prior year twelve-month period ended December 31, 2011 does not include $24,379 decrease in short-term trading investments. This reconciling item is needed to tie back to cash flow from operations.
 
 

In the press release, we provided adjusted cash flow from operations excluding changes in short-term investments. The exclusion of the change in short-term investments is not in accordance with generally accepted accounting principles in the United States (''GAAP''). This non-GAAP financial measure is intended to supplement, but not substitute for, the most directly comparable GAAP measure. We believe that the non-GAAP financial measure provides meaningful information to assist investors and analysts in understanding our financial results because it excludes an item that may not be indicative or is unrelated to our core operating results. However, because non-GAAP financial measures are not standardized, investors are strongly encouraged to review our financial statements and publicly filed reports in their entirety and not rely on any single financial measure. A reconciliation to the most closely-related GAAP measure is provided in the preceding paragraph.

 
The following is a reconciliation of 2012 YTD GAAP Income to Non-GAAP Income:

Reconciliation:

     

(GAAP) YTD 12-31-12

   

* Option Acceleration Expense Recorded in Q1

   

(Non-GAAP) Adjusted YTD 12-31-12

Total Revenue 936,036         936,036
Total Operating Expense   827,769   (3,981 )   823,788  
108,267 112,248
 
Other Income   1,510     1,510  
Income before income taxes 109,777 113,758
Income taxes   45,014   87   45,101  
Net Income 64,763 68,657
Net income attributable to noncontrolling interest   (646 )   (646 )
Net income attributable to Knight Transportation $ 64,117   $ 68,011  
Net Income Per Share
- Basic $ 0.80 $ 0.85
- Diluted $ 0.80 $ 0.85
Weighted Average Shares Outstanding
- Basic 79,673 79,673
- Diluted 80,000 80,000
 

* The first quarter of 2012 included a $4.0 million pretax non-cash stock compensation charge ($3.9 million after tax) relating to the accelerated vesting of certain stock options that had been issued prior to 2009.

This press release contains 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. These statements generally may be identified by their use of terms or phrases such as ''expects,'' ''estimates,'' ''anticipates,'' ''projects,'' ''believes,'' ''plans,'' ''intends,'' ''may,'' ''will,'' ''should,'' ''could,'' ''potential,'' ''continue,'' ''future,'' and terms or phrases of similar substance. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Accordingly, actual results may differ from those set forth in the forward-looking statements. Readers should review and consider the factors that may affect future results and other disclosures by the Company in its press releases, stockholder reports, Annual Report on Form 10-K, and other filings with the Securities and Exchange Commission. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.





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