Pacer posts $10M 4Q net income

user-gravatar

Pacer International Inc. on Tuesday, Feb. 16, reported financial results for the three- and 12-month periods ended Dec. 31:

For the fourth quarter, revenues decreased $90.1 million to $420.2 million compared to $510.3 million for the quarter ended Dec. 26, 2008.  Net income increased from a loss of $64.0 million (which included a $73.3 million after-tax impact of a goodwill impairment charge) to a net income of $10.0 million.

Intermodal segment income from operations increased $6.8 million to an income of $23.5 million compared to an operating income of $16.7 million. The 2009 amount includes the $17.5 million gain on the Union Pacific agreements and $2.0 million of severance and lease termination expense. 

Logistics segment income from operations increased $87.3 million to a loss of $0.1 million compared to a loss of $87.4 million. The 2008 amount includes the $87.9 million goodwill impairment charge, and the 2009 amount includes $0.2 million severance expense.

For the year ended Dec. 31, 2009, revenues decreased $513.3 million to $1,574.2 million compared to $2,087.5 million for the year ended Dec. 26, 2008. Net income declined from a loss of $16.4 million to a loss of $174.1 million in 2009. Net income in both years included the impact of the goodwill impairment charges ($161.0 million after-tax in 2009 and $73.3 million after-tax in 2008). Excluding the impairment charges, net income was a loss of $13.1 million compared to an income of $56.9 million.

Intermodal segment income from operations decreased $274.5 million to a loss of $161.0 million (including a $169.0 million goodwill impairment charge) compared to an operating income of $113.5 million. Excluding the impairment charge in 2009, the intermodal segment recorded an $8.0 million operating income. The 2009 amount includes the $17.5 million gain on the Union Pacific agreements and $4.6 million of severance and lease termination expense.

Logistics segment income from operations increased $51.7 million to a loss of $36.4 million (including a $31.4 million goodwill impairment charge) compared to a loss of $88.1 million (including an $87.9 million goodwill impairment charge). Excluding the impairment charges, the logistics segment recorded a $5.0 million operating loss compared to a $0.2 million loss. The 2009 amount includes the $1.4 million gain on the sale of certain assets of our truck services business and $1.3 million of severance expense.

“Though the economic environment in the fourth quarter continued to suppress demand and pressure margins, we took additional substantial steps toward sustained profitability while reducing debt by $31.5 million during the fourth quarter,” said Brian C. Kane, chief financial officer of Pacer, based in Corcord, Calif. “We returned to positive operating income and cash flow in the second half of the year, and we have significant availability under our amended credit agreement.”

Daniel W. Avramovich, chairman and chief executive officer of Pacer, said the company made significant strides toward its goal of providing excellent door-to-door intermodal service at a competitive cost in the fourth quarter. “We transitioned to a new long-term arrangement with Union Pacific, and on a quarter-over-quarter basis, grew our direct to end-customer intermodal volume by 10.7 percent, and grew our automotive sector intermodal volume by 12.9 percent, while reducing our on-going SG&A expenses by 16 percent compared to the 2008 fourth quarter,” Avramovich said. “We will build on this transformation momentum in 2010 as we execute our strategic plan to provide integrated door-to-door control of all aspects of our intermodal service delivery to end customers.”