Covenant Transportation Group Announces Expectations Concerning Third Quarter Financial Results, and Timing of Earnings Relea...
14 October 2016 - 12:20AM
Covenant Transportation Group, Inc. (NASDAQ:CVTI) announced today
its expectations regarding financial results for the third quarter
of 2016.
Third Quarter Financial ExpectationsChairman
and Chief Executive Officer, David R. Parker, offered the following
comments: “After reviewing preliminary financial and
operating information through the end of September, we expect to
report net income in the range of $2.1 million to $3.2 million, or
$0.12 to $0.17 per diluted share, for the third quarter of
2016. This compares to a reported net income of $7.6 million,
or $0.42 per diluted share, for the third quarter of 2015. The main
differences were higher depreciation, higher claims expense, and
lower average freight revenue per tractor, partially offset by
improved brokerage gross margin and a favorable effective tax rate.
Compared with the third quarter of 2015, depreciation increased
$4.6 million, or $0.15 per diluted share, to $19.3 million,
primarily as a result of lowering the salvage values effectively
increasing the rate of depreciation on a significant percentage of
our tractors due to the expectation that the soft used truck market
could continue for an extended period. A year-over-year increase in
depreciation expense for these tractors will continue to affect our
results for at least the next three quarters. We also experienced a
$1.7 million, or $0.06 per diluted share, year-over-year increase
in casualty insurance and claims expense, primarily as a result of
increased frequency and severity of accidents. Average freight
revenue per tractor declined 1.2%, due to a weaker truckload
freight environment. These factors more than offset improved
performance from our Solutions non-asset based brokerage business
and a favorable effective income tax rate.”
Timing of Earnings Release and Conference
CallThe Company plans to release its third quarter
earnings after 4:00 p.m. Eastern time on Wednesday, October 19,
2016. The Company will hold a live conference call to discuss
its third quarter earnings release on Thursday, October 20, at
10:00 a.m. Eastern time. Individuals with questions may dial
in at 800-351-4894 (U.S./Canada) and 800-756-3333 (International),
access code CTG3. An audio replay will be available for
one week following the call at 877-919-4059, access code
71073390. In addition, you will be able to
listen to the audio replay for an extended period of time on our
investor website, under the icon "Audio Archives". For
additional financial and statistical information regarding the
Company that may be discussed during the conference call, please
visit our website at www.ctgcompanies.com/investor-relations under
the tab "Earnings Info."
Covenant Transportation Group, Inc. is the holding company for
several transportation providers that offer premium transportation
services for customers throughout the United States. The
consolidated group includes operations from Covenant Transport and
Covenant Transport Solutions of Chattanooga, Tennessee; Southern
Refrigerated Transport of Texarkana, Arkansas; and Star
Transportation of Nashville, Tennessee. In addition,
Transport Enterprise Leasing, of Chattanooga, Tennessee is an
integral affiliated company providing revenue equipment sales and
leasing services to the trucking industry. The Company's Class A
common stock is traded on the NASDAQ Global Select under the
symbol, “CVTI”.
This press release contains certain statements that may be
considered 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, and such
statements are subject to the safe harbor created by those sections
and the Private Securities Litigation Reform Act of 1995, as
amended. Such statements may be identified by their use of
terms or phrases such as "expects," "estimates," "projects,"
"believes," "anticipates," "plans," "intends," “outlook,” and
similar terms and phrases. 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.
In this press release, the statements regarding third quarter
expectations are forward-looking statements. The following factors,
among others, could cause actual results to differ materially from
those in the forward-looking statements: the financial expectations
discussed in this release have not been subjected to all of the
review procedures associated with the release of actual financial
results and are premised on assumptions concerning the financial
close and certain amounts and management judgment associated with
the end of each quarter. Readers should review and consider these
factors along with the various disclosures by the Company in its
press releases, stockholder reports, and 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.
For further information contact:
Richard B. Cribbs, EVP and Chief Financial Officer (423) 463-3331
Richard.Cribbs@ctgcompanies.com
For copies of Company information contact:
Kim Perry, Administrative Assistant (423) 463-3357
Kimberly.Perry@ctgcompanies.com
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