RADIANT LOGISTICS, INC. In the news release, Radiant Logistics Announces Results for the Third Fiscal Quarter Ended
Radiant Logistics Announces Results for the Third Fiscal Quarter Ended March 31, 2016
Posts record quarterly results with revenues of $173.3 million - up $71.0 million or 69.4%;
Net revenues increased 54.2% to $41.8 million
Adjusted EBITDA increased 36.4% to $4.7 million
BELLEVUE, Wash., May 16, 2016 /PRNewswire/ -- Radiant Logistics, Inc. (NYSE MKT: RLGT), a third party logistics and multi-modal transportation services company, today reported financial results for the three and nine months ended March 31, 2016.
Third quarter Financial Highlights (Quarter Ended March 31, 2016)
-- Revenues increased to $173.3 million, up $71.0 million or 69.4% compared
to revenues of $102.3 million for the comparable prior year period.
-- Net revenues increased 54.2% to $41.8 million, compared to net revenues
of $27.1 million for the comparable prior year period.
-- Net loss attributable to common stockholders was $2.2 million, or $0.05
per basic and fully diluted share for the third fiscal quarter of 2016,
compared to net income of $0.8 million, or $0.02 per basic and fully
diluted share, for the comparable prior year period.
-- Adjusted net income attributable to common stockholders was $1.8
million, or $0.04 per basic and fully diluted share, for the third
fiscal quarter of 2016, compared to adjusted net income attributable to
common stockholders of $1.4 million, or $0.04 per basic and fully
diluted share, for the comparable prior year period. Both periods are
calculated by applying a normalized tax rate of 36% and excluding other
items not considered part of regular operating activities.
-- Adjusted EBITDA increased 36.4% to $4.7 million for the third fiscal
quarter of 2016, compared to adjusted EBITDA of $3.4 million in the
comparable prior year period. Normalizing these results to exclude $0.6
million in non-recurring transition costs associated with the interim
operation of Service By Air's back-office operations, Adjusted EBITDA
would have been $5.2 million for the third fiscal quarter of fiscal
2016.
CEO Comments
"We are very pleased to report another record quarter in what was a generally soft freight environment in our seasonally slowest quarter ended March 31, 2016", said Bohn Crain, Founder and CEO. We posted revenues of $173.3 million, up $71.0 million or 69.4%; net revenues of $41.8 million, up $14.7 million or 54.2%; and adjusted EBITDA of $4.7 million, up $1.3 million or 36.4%, over the comparable prior year period. Normalizing our adjusted EBITDA to exclude $0.6 million in non-recurring transitions costs associated with redundant back-office operation of Service By Air's back-office that are targeted for elimination later this calendar year, we would have reported adjusted EBITDA of $5.2 million, up $1.8 million, or 52.9%. In addition, we also reported record cash from operations for the nine months ended March 31, 2016 of $19.2 million."
Crain continued: "We also took the opportunity in April of this year to retire $25.0 million subordinated debt that we originally obtained in April of 2015 in connection with our acquisition of Wheels Group, Inc. Given the cash we have been accumulating on our balance sheet and the fact that we had virtually no amounts outstanding under our $65.0 million senior credit facility, we took the opportunity to retire the $25.0 million in subordinated debt and excluding a one-time pre-payment fee $750,000, capture what we estimate to be approximately $2.0 million in annualized cost savings in reduced interest expense going forward. Even after giving effect to the payment of the subordinated debt, we have approximately $10.0 million in net debt outstanding under our senior credit facility and remain well positioned to continue our disciplined approach of acquiring non-asset based businesses. We have low leverage on our balance sheet, strong free cash flow and continue to search for acquisition candidates that bring critical mass to our current platform with respect to geography, purchasing power and complementary service offerings."
"We have updated our guidance for fiscal 2016 to reflect current market trends and our recent retirement of the $25.0 million in subordinated debt with normalized adjusted EBITDA in the range of $27.5 - $29.5 million on revenues of $788.9 - $829.1 million. This equates to adjusted net income attributable to common shareholders in the range of $10.6 - $11.8 million, or $0.22 - $0.24 per basic and fully diluted share."
Third quarter ended March 31, 2016 - Financial Results
For the three months ended March 31, 2016, Radiant reported a net loss attributable to common stockholders of $2.2 million on $173.3 million of revenues, or $0.05 per basic and fully diluted share. For the three months ended March 31, 2015, Radiant reported net income attributable to common stockholders of $0.8 million on $102.3 million of revenues, or $0.02 per basic and fully diluted share.
For the three months ended March 31, 2016, Radiant reported adjusted net income attributable to common stockholders of $1.8 million, or $0.04 per basic and fully diluted share. For the three months ended March 31, 2015, Radiant reported adjusted net income attributable to common stockholders of $1.4 million, or $0.04 per basic and fully diluted share.
The Company also reported adjusted EBITDA of $4.7 million for the three months ended March 31, 2016, compared to adjusted EBITDA of $3.4 million for the three months ended March 31, 2015. Normalizing these results to exclude $0.6 million in non-recurring transition costs associated with the interim operation of Service by Air's back-office operations, Adjusted EBITDA would have been $5.2 million for the three months ended March 31, 2016.
A reconciliation of the Company's adjusted net income and adjusted EBITDA to the most directly comparable GAAP measure for the three months ending March 31, 2016 and 2015 appears at the end of this release.
Nine Months Ended March 31, 2016 - Financial Results
For the nine months ended March 31, 2016, Radiant reported a net loss attributable to common stockholders of $4.9 million on $598.9 million of revenues, or $0.10 per basic and fully diluted share. For the nine months ended March 31, 2015, Radiant reported net income attributable to common stockholders of $2.2 million on $306.4 million of revenues, or $0.06 per basic and fully diluted share.
For the nine months ended March 31, 2016, Radiant reported adjusted net income attributable to common stockholders of $9.0 million, or $0.19 per basic and fully diluted share. For the nine months ended March 31, 2015, Radiant reported adjusted net income attributable to common stockholders of $4.7 million, or $0.14 per basic and $0.13 per fully diluted share.
The Company also reported adjusted EBITDA of $19.0 million for the nine months ended March 31, 2016, compared to adjusted EBITDA of $10.7 million for the nine months ended March 31, 2015. Normalizing these results to exclude $1.9 million in non-recurring transition costs associated with the interim operation of Service by Air's back-office operations, Adjusted EBITDA would have been $20.9 million for the nine months ended March 31, 2016.
A reconciliation of the Company's adjusted net income and adjusted EBITDA to the most directly comparable GAAP measure for the nine months ended March 31, 2016 and 2015 appears at the end of this release.
Investor Conference Call
Radiant will host a conference call for stockholders and the investing community on Monday, May 16, 2016 at 4:30 pm, ET to discuss the contents of this release. The call can be accessed by dialing (877) 407-8031, or (201) 689-8031 for international participants, and is expected to last approximately 30 minutes. Callers are requested to dial in 5 minutes before the start of the call. An audio replay will be available for two weeks after the teleconference by dialing (877) 660-6853, or (201) 612-7415 for international callers, and using conference ID number 13636863. This call is also being webcast and may be accessed via Radiant's web site at www.radiantdelivers.com.
About Radiant Logistics (NYSE MKT: RLGT)
Radiant Logistics, Inc. (www.radiantdelivers.com) is a third party logistics and multimodal transportation services company. Through its comprehensive service offering, Radiant provides domestic and international freight forwarding services, truck and rail brokerage services and other value-added supply chain management services, including customs brokerage, order fulfillment, inventory management and warehousing to a diversified account base including manufacturers, distributors and retailers using a network of independent carriers and international agents positioned strategically around the world.
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results may differ significantly from management's expectations. These forward-looking statements involve risks and uncertainties that include, among others, risks related to: trends in the domestic and global economy; our ability to attract new and retain existing agency relationships; acquisitions and integration of acquired entities; availability of capital to support our acquisition strategy; our ability to maintain and improve back office infrastructure and transportation and accounting information systems in a manner sufficient to service our revenues and network of operating locations; the ability of the Wheels operation to maintain and grow its revenues and operating margins in a manner consistent with its most recent operating results and trends; our ability to maintain positive relationships with Wheels' third-party transportation providers, suppliers and customers; outcomes of legal proceedings; competition; management of growth; potential fluctuations in operating results; and government regulation. More information about factors that potentially could affect our financial results is included Radiant Logistics, Inc.'s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and subsequent filings.
RADIANT LOGISTICS, INC.
Consolidated Balance Sheets
March 31, June 30,
2016 2015
---- ----
ASSETS
Current assets:
Cash and cash equivalents $19,796,979 $7,268,144
Accounts receivable, net of allowance of $1,679,317 and $1,551,202, respectively 98,737,946 127,348,546
Employee and other receivables 308,809 110,728
Income tax deposit 4,657,411 4,102,191
Prepaid expenses and other current assets 5,036,006 5,671,872
Deferred tax asset 1,976,463 1,977,433
--------- ---------
Total current assets 130,513,614 146,478,914
----------- -----------
Furniture and equipment, net 12,647,736 13,175,890
---------- ----------
Acquired intangibles, net 74,014,497 82,954,682
Goodwill 63,119,472 63,089,222
Deposits and other assets 2,329,910 3,007,492
--------- ---------
Total long-term assets 139,463,879 149,051,396
----------- -----------
Total assets $282,625,229 $308,706,200
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued transportation costs $74,657,886 $92,025,407
Commissions payable 8,848,393 9,449,047
Other accrued costs 5,082,968 7,732,101
Due to former shareholders of acquired operations - 683,593
Current portion of notes payable 2,185,675 543,086
Current portion of contingent consideration 3,240,000 1,872,000
Current portion of transition and lease termination liability 1,618,189 282,849
Other current liabilities 277,317 297,727
------- -------
Total current liabilities 95,910,428 112,885,810
---------- -----------
Notes payable, net of current portion 45,498,474 85,892,515
Contingent consideration, net of current portion 3,870,000 5,741,000
Transition and lease termination liability, net of current portion 679,338 923
Deferred rent liability 962,812 1,143,749
Deferred tax liability 15,213,174 17,544,417
Other long-term liabilities 830,920 1,004,812
------- ---------
Total long-term liabilities 67,054,718 111,327,416
---------- -----------
Total liabilities 162,965,146 224,213,226
----------- -----------
Stockholders' equity:
Preferred stock, $0.001 par value, 5,000,000 shares authorized; 839,200 shares issued and 839 839
outstanding, liquidation preference of $20,980,000
Common stock, $0.001 par value, 100,000,000 shares authorized; 48,752,522 and 42,563,224 30,207 24,018
shares issued and outstanding, respectively
Additional paid-in capital 114,079,203 74,658,960
Deferred compensation (1,387) (4,166)
Retained earnings 5,215,894 10,146,282
Accumulated other comprehensive income (loss) 268,136 (394,547)
------- --------
Total Radiant Logistics, Inc. stockholders' equity 119,592,892 84,431,386
----------- ----------
Non-controlling interest 67,191 61,588
------ ------
Total stockholders' equity 119,660,083 84,492,974
----------- ----------
Total liabilities and stockholders' equity $282,625,229 $308,706,200
============ ============
RADIANT LOGISTICS, INC.
Consolidated Statements of Operations and Comprehensive Income
Three Months Ended March 31, Nine Months Ended March 31,
---------------------------- ---------------------------
2016 2015 2016 2015
---- ---- ---- ----
Revenues $173,275,508 $102,251,690 $598,879,123 $306,431,182
Cost of transportation 131,474,107 75,147,153 458,768,400 225,409,489
----------- ---------- ----------- -----------
Net revenues 41,801,401 27,104,537 140,110,723 81,021,693
---------- ---------- ----------- ----------
Operating partner commissions 18,954,943 13,941,213 62,943,901 42,818,474
Personnel costs 13,185,487 7,221,932 40,907,899 20,758,358
Selling, general and administrative expenses 5,865,425 3,579,001 18,957,327 9,109,285
Depreciation and amortization 3,036,845 1,279,761 9,260,698 3,658,555
Transition and lease termination costs 788,922 - 5,108,570 395,086
Impairment of acquired intangible assets - - 3,679,825 -
Change in contingent consideration 441,560 (428,216) 627,793 (1,149,012)
------- -------- ------- ----------
Total operating expenses 42,273,182 25,593,691 141,486,013 75,590,746
---------- ---------- ----------- ----------
Income (loss) from operations (471,781) 1,510,846 (1,375,290) 5,430,947
-------- --------- ---------- ---------
Other income (expense):
Interest income 29,724 330 44,201 1,987
Interest expense (1,369,367) (140,900) (4,104,842) (328,801)
Foreign exchange gain (loss) (80,159) (64,269) 388,593 47,813
Other (15,028) 8,619 103,474 84,092
------- ----- ------- ------
Total other expense: (1,434,830) (196,220) (3,568,574) (194,909)
---------- -------- ---------- --------
Income (loss) before income tax expense (1,906,611) 1,314,626 (4,943,864) 5,236,038
Income tax benefit (expense) 207,347 40,553 1,601,242 (1,477,864)
------- ------ --------- ----------
Net income (loss) (1,699,264) 1,355,179 (3,342,622) 3,758,174
Less: Net income attributable to non-controlling interest (19,790) (19,054) (53,603) (62,646)
------- ------- ------- -------
Net income (loss) attributable to Radiant Logistics, Inc. (1,719,054) 1,336,125 (3,396,225) 3,695,528
Less: Preferred stock dividends (511,388) (511,368) (1,534,163) (1,534,144)
-------- -------- ---------- ----------
Net income (loss) attributable to common stockholders $(2,230,442) $824,757 $(4,930,388) $2,161,384
=========== ======== =========== ==========
Other comprehensive income (loss):
Foreign currency translation gain (loss) (758,802) - 662,683 -
-------- --- ------- ---
Comprehensive income (loss) $(2,989,244) $824,757 $(4,267,705) $2,161,384
=========== ======== =========== ==========
Net income (loss) per common share - basic and diluted $(0.05) $0.02 $(0.10) $0.06
Weighted average shares outstanding:
Basic shares 48,745,727 34,758,931 48,282,964 34,577,405
Diluted shares 48,745,727 36,476,629 48,282,964 36,161,557
RADIANT LOGISTICS, INC.
Reconciliation of Net Income to Adjusted Net Income, EBITDA, Adjusted EBITDA, and Reconciliation of Net
Income per share to Adjusted Net Income per share
(unaudited)
As used in this report, Adjusted Net Income and Adjusted Net Income per Share, EBITDA and Adjusted EBITDA are not measures of financial performance or liquidity under United States Generally Accepted Accounting Principles ("GAAP"). Adjusted Net Income and Adjusted Net Income per Share, EBITDA and Adjusted EBITDA are presented herein because they are important metrics used by management to evaluate and understand the performance of the ongoing operations of Radiant's business. For Adjusted Net Income, management uses a 36% tax rate for calculating the provision for income taxes before preferred dividend requirement to normalize Radiant's tax rate to that of its competitors and to compare Radiant's reporting periods with different effective tax rates. In addition, in arriving at Adjusted Net Income and Adjusted Net Income per Share, the Company adjusts for significant items that are not part of regular operating activities. These adjustments include acquisition costs, transition, severance and lease termination costs, non-recurring litigation expenses as well as depreciation and amortization and certain other non-cash charges.
Adjusted EBITDA means earnings before preferred stock dividends, interest, income taxes, depreciation and amortization, which is then further adjusted for changes in contingent consideration, expenses specifically attributable to acquisitions, severance and lease termination costs, extraordinary items, share based compensation expense, non-recurring litigation expenses and other non-cash charges. We believe that adjusted EBITDA, as presented, represents a useful method of assessing the performance of our operating activities, as it reflects our earnings trends without the impact of certain non-cash charges and other non-recurring charges. We understand that although securities analysts frequently use EBITDA in their evaluation of companies, it is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the method of calculation. Adjusted Net Income and Adjusted Net income per Share, EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for any of the consolidated statements of operations prepared in accordance with GAAP, or as an indication of Radiant's operating performance or liquidity. Normalized Adjusted EBITDA represents the Adjusted EBITDA but also adds back transition costs associated with the SBA back-office that is projected to be eliminated as Radiant's back office in Bellevue Washington will absorb these services.
Three Months Ended March 31, Nine Months Ended March 31,
---------------------------- ---------------------------
2016 2015 2016 2015
---- ---- ---- ----
Net income (loss) attributable to common stockholders $(2,230,442) $824,757 $(4,930,388) $2,161,384
Net income (loss) per common share - basic and diluted $(0.05) $0.02 $(0.10) $0.06
Reconciliation of net income (loss) to adjusted net
income:
Net income (loss) attributable to common stockholders $(2,230,442) $824,757 $(4,930,388) $2,161,384
Adjustments to net income:
Income tax expense (benefit) (207,347) (40,553) (1,601,242) 1,477,864
Depreciation and amortization 3,036,845 1,279,761 9,260,698 3,658,555
Change in contingent consideration 441,560 (428,216) 627,793 (1,149,012)
Lease termination costs 235,392 - 2,342,735 395,086
Acquisition related costs 276,687 599,117 1,723,883 1,271,394
Non-recurring legal costs 839,595 175,426 1,591,374 361,892
Amortization of loan fees 101,403 15,295 302,385 45,885
Transition costs associated with acquisitions 553,530 - 1,931,169 -
Loss on impairment of acquired intangible assets - - 3,679,825 -
--- --- --------- ---
Adjusted net income before income taxes 3,047,223 2,425,587 14,928,232 8,223,048
Provision for income taxes at 36% before preferred (1,281,100) (1,057,304) (5,926,462) (3,512,589)
dividend requirement
Adjusted net income $1,766,123 $1,368,283 $9,001,770 $4,710,459
========== ========== ========== ==========
Adjusted net income per common share:
Basic $0.04 $0.04 $0.19 $0.14
Diluted $0.04 $0.04 $0.19 $0.13
Weighted average shares outstanding:
Basic shares 48,745,727 34,758,931 48,282,964 34,577,405
Diluted shares 49,447,381 36,476,629 49,311,429 36,161,557
Three Months Ended March 31, Nine Months Ended March 31,
---------------------------- ---------------------------
Reconciliation of net income (loss) to normalized 2016 2015 2016 2015
adjusted EBITDA
Net income (loss) attributable to common stockholders $(2,230,442) $824,757 $(4,930,388) $2,161,384
Preferred stock dividends 511,388 511,368 1,534,163 1,534,144
------- ------- --------- ---------
Net income (loss) attributable to Radiant Logistics, Inc. (1,719,054) 1,336,125 (3,396,225) 3,695,528
Income tax expense (benefit) (207,347) (40,553) (1,601,242) 1,477,864
Depreciation and amortization 3,036,845 1,279,761 9,260,698 3,658,555
Net interest expense 1,339,643 140,570 4,060,641 326,814
--------- ------- --------- -------
EBITDA 2,450,087 2,715,903 8,323,872 9,158,761
Share-based compensation 326,973 281,204 1,085,169 732,772
Change in contingent consideration 441,560 (428,216) 627,793 (1,149,012)
Acquisition related costs 276,687 599,117 1,723,883 1,271,394
Non-recurring legal costs 839,595 175,426 1,591,374 361,892
Lease termination costs 235,392 - 2,342,735 395,086
Loss on impairment of acquired intangible assets - - 3,679,825 -
Foreign exchange loss (gain) 80,159 64,269 (388,593) (47,813)
------ ------ -------- -------
Adjusted EBITDA 4,650,453 3,407,703 18,986,058 10,723,080
Transition costs 553,530 - 1,931,169 -
------- --- --------- ---
Normalized adjusted EBITDA $5,203,983 $3,407,703 $20,917,227 $10,723,080
========== ========== =========== ===========
As a % of Net Revenues 12.4% 12.6% 14.9% 13.2%
Reconciliation of Non-GAAP Financial Measures to Preliminary Guidance
This press release contains certain non-GAAP financial measures as defined under the Securities Exchange Commission ("SEC") rules such as adjusted net income, adjusted net income per share and earnings before interest, taxes, depreciation and amortization ("EBITDA"). We believe that supplemental disclosure of these amounts are important metrics used by management to evaluate and understand the performance of the ongoing operations of Radiant's business that eliminates depreciation, amortization and certain other non-cash costs and other significant items that are not part of regular operating activities. This supplemental financial information is presented for informational purposes only and is not a substitute for the financial information presented in accordance with accounting principles generally accepted in the United States. A reconciliation of adjusted net income, adjusted net income per share and adjusted EBITDA for the Company's preliminary guidance for its fiscal year ending June 30, 2016 is as follows:
(in thousands, except for earnings per share)
Outlook
Fiscal Year
Ending
June 30, 2016
-------------
Net loss attributable to Radiant ($3,020) -
Logistics, Inc. ($1,792)
Less: Preferred Dividend Requirement (2,046)
------
Net loss attributable to common ($5,066) -
stockholders ($3,838)
Net loss per common share:
Basic and Diluted ($0.10) -
($0.08)
Weighted average shares outstanding:
Basic shares 49,000,000
Diluted shares 49,000,000
Reconciliation of net loss to adjusted
net income:
Net loss attributable to common ($5,066) -
stockholders ($3,838)
Adjustments to net income:
Income tax benefit (1,652) -(959)
Depreciation and amortization 12,248
Change in contingent consideration 672
Lease termination costs 2,343
Loss on write-off of debt discount
and prepayment penalty 1,150
Acquisition related costs 1,904
Non-recurring legal costs 2,082
Amortization of loan fees 345
Loss on impairment of acquired
intangible assets 3,680
-----
Adjusted net income before income
taxes 17,706 -19,627
Less: Provision for income taxes at (7,111) -
blended 36% (7,802)
before preferred dividend requirement
of $2,046
Adjusted net income $10,595 - $11,825
================
Adjusted net income per common share:
Basic and Diluted $0.22 - $0.24
Reconciliation of net loss to normalized
adjusted EBITDA Outlook
Fiscal Year
Ending
June 30,
2016
---------
Net loss attributable to Radiant ($3,020) -
Logistics, Inc. ($1,792)
Less: Preferred dividends (2,046)
------
Net loss attributable to common ($5,066) -
stockholders ($3,838)
Adjustments to net income:
Preferred dividend 2,046
Interest expense - net 4,234 -
4,363
Income tax benefit (1,652) -
(959)
Depreciation and amortization 12,248
------
EBITDA $11,810 - $13,860
Share-based compensation 1,941
Change in contingent consideration 672
Loss on write-off of debt discount and
prepayment penalty 1,150
Acquisition related costs 1,904
Non-recurring legal costs 2,082
Lease termination costs 2,343
Loss on impairment of acquired intangible
assets 3,680
Foreign exchange gain (389)
----
Adjusted EBITDA $25,193 - $27,243
Transition costs 2,281
-----
Normalized adjusted EBITDA $27,474 - $29,524
============
This supplemental financial information is presented for informational purposes only and is not a substitute for the financial information presented in accordance with accounting principles generally accepted in the United States.
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SOURCE Radiant Logistics, Inc.
