These forward-looking statements are based on current expectations and are naturally subject to uncertainty and changes in circumstances that may cause actual results to differ materially from those expressed or implied by such forward-looking statements. Such forward-looking statements involve known and unknown risks and uncertainties and other factors that may cause Vitran’s actual results, performance or achievements to differ materially from those projected in the forward-looking statements. Factors that may cause such differences include, but are not limited to; technological change, increasing fuel costs, regulatory change, the general health of the economy, seasonal fluctuations, unanticipated changes in railroad capacity, exposure to credit risks, change in labor relations, geographic expansion, capital requirements, availability of financing, claims and insurance costs, environmental hazards and competitive factors.More detailed information about these and other factors are included in the annual form 10-K under “Item 1A – Risk Factors.” Many of these factors are beyond the company’s control. Therefore, future events may vary substantially from what the company currently perceives. You should not place undue reliance on such forward-looking statements. Vitran Corporation Inc. does not assume the obligation to revise or update these forward-looking statements after the date of this call or to revise them to reflect the occurrence of future, unanticipated events. The 2010 first quarter marked the company’s second successive quarter of year-over-year quarterly financial improvement. Revenue, income from operations and EPS for the 2010 first quarter all improved as compared to the 2009 first quarter. Consolidated revenue was $166 million compared to $140 million in the 2009 first quarter. Income from operations improved to $200,000 in Q1 2010 compared to a loss from operations of $2.9 million in Q1 2009. Loss per share was $0.06 compared to a loss per share of $0.17 in the first quarter of 2009. Furthermore, these results on a sequential basis outpaced the 2009 fourth quarter.
Vitran’s consolidated operating ratio was 99.9% in the first quarter of 2010 compared to 102% in the first quarter of 2009. The consolidated increases were driven by notable improvements in all three of the company’s operating segments; LTL, supply chain operations and truck load. Interest expense for the 2010 first quarter was $2.1 million compared to $2.2 million in the same quarter of 2009. An increase in bank syndication fees partially offset the benefit of lower interest rate margins on lower total debt outstanding.That being said, with the improvement in the consolidated financial results for the company for the second consecutive quarter we reduced the consolidated leverage ratio thereby earning another 50 basis point reduction in syndicated debt requirements. We will continue to monitor our debt positions and borrowing costs. Income tax recovery for the first quarter of 2010 was $1 million compared to a recovery of $2.7 million for the same quarter a year ago due to the improvement in loss before income tax expense. On a consolidated basis, the company generated taxable losses in the United States which have been recognized as a deferred tax asset. We believe the company will generate sufficient taxable income to use these losses in the future. Cash flow from operations for each of the first quarter’s of 2010 and 2009 consumed $100,000. Albeit, the net loss in the first quarter of 2010 improved $1.4 million. This achievement was offset by the change in non-cash working capital. Significantly higher revenue in March 2010 compared to December 2009 pushed accounts receivable and therefore working capital higher. Average DSO for the first quarter of 2010 was 42.3 days compared to 45.7 days in the first quarter of 2009. Capital expenditures for the first quarter were $2.9 million, the majority of which was the acquisition of a $1.4 million facility in Grand Rapids, Michigan and the balance of the expenditures were for rolling stock and information technology. We anticipate total capital expenditures for 2010 will likely be between $10-12 million. We will continue to monitor our capital expenditure program vigilantly and adjust the expenditures to the results of the company. Read the rest of this transcript for free on seekingalpha.com