Express-1 Expedited Solutions Inc. on Tuesday, Feb. 10, reported its earnings for the fourth quarter ended Dec. 31. Express-1 Expedited Solutions, through its three operating companies – Express-1, Concert Group Logistics and Bounce Logistics – provides same-day delivery, time-sensitive shipping and premium freight brokerage throughout North America, as well as domestic and international freight forwarding.
Express-1 Expedited Solutions reported a 95 percent increase in revenue from continuing operations during the fourth quarter to $25.0 million compared to $12.8 million for the same period in the prior year. The acquisition of Concert Group Logistics, which had a transaction date of Jan. 1, 2008, contributed $11.8 million to revenues for the period. The company’s Express-1 operations experienced a decline in revenues of $2.1 million or 16.7 percent. Bounce Logistics contributed $2.8 million to the overall increase in revenues.
Operating income from continuing operations increased by 84 percent to $1.04 million versus $569,000. Income from continuing operations improved 39 percent to $514,000 compared to $369,000.
During the fourth quarter of 2008, the company discontinued its Express-1 Dedicated Operations in anticipation of a cessation of this business activity during the first quarter of 2009. The company’s management does not anticipate the incurrence of material charges related to this shutdown activity. Income from discontinued operations was $73,000, net of tax, versus income of $88,000, net of tax.
“Throughout 2008, we have shared with our investors the significant impact the company has experienced from our Concert Group Logistics and Bounce Logistics operations,” said Michael Welch, chief executive officer of St. Joseph, Mich.-based Express-1 Expedited Solutions. “Each of these businesses is profitable and has contributed to the overall business mix within our platform. In periods of weakness within the various freight economies, it is important to have this diversity within our company. With the widely publicized downturn in the domestic and international economies, the strength of our nonasset-based operating model came through. While we’re never totally pleased with our results, we are proud that we can maintain growth and profitability in the face of such an extremely weak freight market.”
Chief Financial Officer Mark Patterson said the company continued to demonstrate significant operating leverage during the fourth quarter. “The rate of growth within our selling, general and administrative expenses was approximately one-fourth the rate of growth of our revenues,” he said. “The result of this leverage is that we have been able to continuously increase our operating income from continuing operations, even in periods of rate compression and weakness within the overall transportation market. During the fourth quarter of 2008, we took some significant steps aimed at controlling SG&A costs. These included headcount reductions, reductions in executive and managerial bonus awards, limitations on travel and entertainment, and limitations on hiring and wage increases. Our entire organization is focused upon efforts that will enhance and support our profitability, even in the face of the current recession. We are very proud of how our entire team has responded thus far.”
Welch said that looking toward 2009, the company continues to be focused on business development efforts and maintaining an acceptable level of profitability until the economic climate improves. “Potential acquisitions, new business development and stringent cost controls are critical to achieving the results we desire in 2009,” he said. “Our nonasset-based business model has proven itself over many years and in all types of economic climates. By remaining focused on our goals, we should be able to weather the current economic recession better than many of our peers within the transportation community.”