JACKSONVILLE, Fla.,
Aug. 6, 2014 /PRNewswire/ -- Patriot
Transportation Holding, Inc. (NASDAQ-PATR) reported net income of
$3,485,000 or $.36 per diluted share in the third quarter of
fiscal 2014, an increase of $483,000
or 16.1% compared to net income of $3,002,000 or $.31
per diluted share in the same period last year. The third
quarter of 2014 included gains from land sales and lower interest
expense due to prepayment of mortgages in the same quarter last
year. Net income for the first nine months of fiscal 2014 was
$7,529,000 or $.78 per diluted share, a decrease of
$867,000 or 10.3% compared to net
income of $8,396,000 or $.88 per diluted share for the same period last
year.
Third Quarter Operating Results. For the third
quarter of fiscal 2014, consolidated revenues were $41,248,000, an increase of $5,540,000 or 15.5% over the same quarter last
year.
Transportation segment revenues increased 16.6% compared to the
third quarter of fiscal 2013 due to a 19.2% increase in revenue
miles. The Pipeline acquisition in November 2013, new business and a longer average
haul length drove the increase in revenue miles. Revenue per mile
decreased 2.3% over the same period last year due to a longer
average haul length and lower rates on the business acquired in the
Pipeline acquisition.
Mining royalty land segment revenues for the third quarter of
fiscal 2014 were $1,395,000, an
increase of $96,000 or 7.4% over the
same quarter last year due to increased tons mined.
Developed property rentals segment revenues for the third
quarter of fiscal 2014 were $6,284,000, an increase of $669,000 or 11.9% primarily due to revenue on the
125,550 square foot build to suit building completed and occupied
during the second quarter of fiscal 2014 and revenue on the 5
buildings added June 2013 related to
the purchase of Transit Business Park. Occupancy at
June 30, 2014 was 89.5% as compared
to 89.9% at June 30, 2013. As a
result of the increased buildings-in-service platform average
square feet occupied during the quarter increased 270,386 or 9.7%
versus the same quarter last year.
Consolidated operating profit was $5,730,000 in the third quarter of fiscal 2014, a
decrease of $340,000 or 5.6% compared
to $6,070,000 in the same period last
year. Despite a 16.6% increase in revenues quarter over
quarter, operating profit in the transportation segment decreased
$662,000 or 21.3% primarily due to
lower revenue per mile, higher health and accident claims, higher
fuel expense and costs associated with the use of out of town
drivers. Operating profit in the mining royalty land segment
increased $73,000 or 7.4% primarily
due to an increase in tons mined. Operating profit in the Developed
property rentals segment increased $204,000 or 9.3% due to the 125,550 square foot
build to suit building completed and occupied during the second
quarter 2014 and lower professional fees offset by higher property
taxes. Consolidated operating profit includes corporate
expenses not allocated to any segment in the amount of $159,000 in the third quarter of fiscal 2014, a
decrease of $45,000 compared to the
same period last year.
Gain on investment land sold for the third quarter of fiscal
2014 included $327,000 for the sale
of a parcel in Patriot Business Park and $123,000 of deferred profits on prior year land
sales related to post closing development obligations.
Interest expense decreased $699,000 over the same quarter last year due to
accelerated prepayment costs in the same quarter last year and a
declining mortgage principal balance. On June 3, 2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12%
mortgage under an early prepayment provision the note allowed after
7.5 years. The $561,000 cost of
the prepayment included a penalty of $386,000 and the remaining deferred loan costs of
$175,000.
Income tax expense increased $308,000 over the same quarter last year due to
higher earnings compared to the same quarter last year.
Nine Months Operating Results. For the first nine
months of fiscal 2014, consolidated revenues were $119,975,000, an increase of $17,342,000 or 16.9% over the same period last
year.
Transportation segment revenues increased 17.5% compared to the
first nine months ended June 30, 2013
due to a 20.4% increase in revenue miles. The Pipeline
acquisition in November 2013, new
business and a longer average haul length drove the increase in
revenue miles. Revenue per mile decreased 2.3% over the same period
last year due to a longer average haul length and lower rates on
the business acquired in the Pipeline acquisition.
Mining royalty land segment revenues for the first nine months
of fiscal 2014 were $3,889,000, an
increase of $15,000 or .4% over the
same period last year.
Developed property rentals segment revenues for the first nine
months of fiscal 2014 were $19,026,000, an increase of $2,876,000 or 17.8% due to higher average
occupancy, snow removal reimbursements, revenue on the 117,600
square foot build to suit building completed and occupied during
the quarter ended March 2013, revenue
on the 5 buildings added June 2013
related to the purchase of Transit Business Park and revenue on the
125,550 square foot build to suit building completed and occupied
during the quarter ended March 2014. Occupancy at
June 30, 2014 was 89.5% as compared
to 89.9% at June 30, 2013. As a
result of the increased buildings-in-service platform average
square feet occupied during the nine months increased 335,903 or
12.6% versus the same period last year.
Consolidated operating profit was $13,000,000 in the first nine months of fiscal
2014, a decrease of $1,786,000 or
12.1% compared to $14,786,000 in the
same period last year. Although revenues for the
transportation segment were up 17.5% year over year, operating
profit decreased $2,027,000 or 29.7%
due to lower revenue per mile, higher accident and health claims,
costs incurred to use out-of-town drivers to service new business
and reduced equipment sales and other expense increases. Operating
profit in the mining royalty land segment decreased $58,000 or 2.0% primarily due to increased
depletion and allocated corporate expenses. Operating profit in the
Developed property rentals segment increased $500,000 or 8.1% due to higher average occupancy,
the 117,600 square foot build to suit building completed and
occupied during the second quarter 2013, and the 125,550 square
foot build to suit building completed and occupied during the
second quarter 2014 offset by higher property taxes and
professional fees. Consolidated operating profit includes
corporate expenses not allocated to any segment in the amount of
$1,337,000 in the first nine months
of fiscal 2014, an increase of $201,000 compared to the same period last year
primarily due to the higher market value associated with the annual
director stock grant.
Gain on investment land sold for the first nine months of fiscal
2014 included $327,000 for the sale
of a parcel in Patriot Business Park and $201,000 of deferred profits on prior year land
sales related to post closing development obligations. Gain on
investment land sold for the first nine months of fiscal 2013
included a gain on the sale of the developed property rentals
Commonwealth property of $1,116,000
before income taxes.
Interest expense decreased $1,050,000 over the same period last year due to
an accelerated payment on long-term debt and a declining mortgage
principal balance. On June 3,
2013 the Company prepaid the $7,281,000 remaining principal balance on a 6.12%
mortgage under an early prepayment provision the note allowed after
7.5 years. The $561,000 cost of the
prepayment included a penalty of $386,000 and the remaining deferred loan costs of
$175,000.
Income tax expense decreased $555,000 over the same period last year due to
lower earnings compared to the same period last year.
Summary and Outlook. Transportation revenues for
the first nine months of fiscal 2014 increased $14,451,000 or 17.5% over the first nine months
of 2013. The bottom line contribution of these additional
revenues was not achieved as duplicate expense of temporarily
transferred drivers and extra driving and training pay and higher
health and accident claims nullified any return on the added
revenues. We made progress in the third quarter in reducing our
out-of-town driver costs and our operating profit margin improved
over the two previous sequential quarters.
Developed property rentals occupancy was 89.5% at June 30, 2014 and 89.9% at June 30, 2013. Occupancy at June 30, 2014 and 2013 included 8,200 square feet
or .2% and 77,465 square feet or 2.3% respectively for temporary
leases under a less than full market lease rate. On
June 6, 2014, the Company purchased
for approximately $4.8 million, the
Kelso property in Baltimore,
Maryland which consists of 2 buildings on 10.2 acres
totaling 69,680 square feet. Total completed developed square
footage increased 6.0% from June 30,
2013 to 3,472,309 at June 30,
2014. In addition to the completed buildings, we own land in
four separate distinct submarkets that we believe ultimately could
support up to 17 buildings totaling 1,406,906 square feet.
The net book value of these properties at June 30, 2014 was $25,435,000 (including construction in progress
of the third build-to-suit building of 129,850 sf at Patriot
Business Park on land with a net book value of $6,810,000). On May
1, 2014, the Company entered into a long term lease with
VADATA for its third build-to-suit data warehouse for 129,850 sq.
ft.; the first (117,600 sq. ft.) and second (125,550 sq. ft.)
build-to-suit data warehouses were completed and occupied in
January 2013 and January 2014, respectively.
The Company anticipates commencement of construction of the
first phase of the four phase Anacostia development in late summer
2014 with lease up scheduled between late 2015 and all of 2016.
On May 7, 2014, the Company
announced that it planned to separate its transportation business
into an independent publicly traded company through a tax free
spin-off of the transportation business to Patriot shareholders.
The separation, which is subject to a number of conditions
including final Board approval, receipt of an opinion of tax
counsel and effectiveness of a registration statement on Form 10,
is expected to be completed in the next 9 months.
Conference Call. The Company will also host a
conference call on Wednesday afternoon, August 6, 2014 at 2:00
p.m. (EDT). Analysts, stockholders and other
interested parties may access the teleconference live by calling
1-800-593-9034 (pass code 94687) within the United States.
International callers may dial 1-334-323-7224 (pass code
94687). Computer audio is available via the Internet through
the Conference America, Inc. website
at http://64.202.98.81/conferenceamerica or via the Company's
website at http://www.patriottrans.com. For the archived
audio via the internet, click on the following link
http://wm.yourcall.com/archivestream/pth080614.wma. If using the
Company's website, click on the Investor Relations tab, then select
Patriot Transportation Holding, Inc. Conference Stream, next select
the appropriate link for the current conference. An audio
replay will be available for sixty days following the conference
call. To listen to the audio replay, dial toll free 877-919-4059,
international callers dial 334-323-0140. The passcode of the
audio replay is 70366992. Replay options: "1" begins
playback, "4" rewind 30 seconds, "5" pause, "6" fast forward
30 seconds, "0" instructions, and "9" exits recording. There
may be a 30-40 minute delay until the archive is available
following the conclusion of the conference call.
Investors are cautioned that any statements in this press
release which relate to the future are, by their nature, subject to
risks and uncertainties that could cause actual results and events
to differ materially from those indicated in such forward-looking
statements. These include general economic conditions;
competitive factors; political, economic, regulatory and climatic
conditions; driver availability and cost; the impact of future
regulations regarding the transportation industry; freight demand
for petroleum product and levels of construction activity in the
Company's markets; fuel costs; risk insurance markets; demand for
flexible warehouse/office facilities; ability to obtain zoning and
entitlements necessary for property development; interest rates;
levels of mining activity; pricing; energy costs and technological
changes. Additional information regarding these and other
risk factors and uncertainties may be found in the Company's
filings with the Securities and Exchange Commission.
Patriot Transportation Holding, Inc. is engaged in the
transportation and real estate businesses. The Company's
transportation business is conducted through Florida Rock & Tank Lines, Inc. which is a
Southeastern transportation company concentrating in the hauling by
motor carrier of liquid and dry bulk commodities. The
Company's real estate group, comprised of FRP Development Corp. and
Florida Rock Properties, Inc., acquires, constructs, leases,
operates and manages land and buildings to generate both current
cash flows and long-term capital appreciation. The real
estate group also owns real estate which is leased under mining
royalty agreements or held for investment.
PATRIOT
TRANSPORTATION HOLDING, INC. AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In
thousands except per share amounts)
(Unaudited)
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|
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THREE MONTHS
ENDED
JUNE
30,
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NINE MONTHS
ENDED
JUNE 30,
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2014
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2013
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|
2014
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|
2013
|
Revenues:
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|
|
|
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|
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|
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|
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Transportation
|
$
|
33,569
|
|
|
|
28,794
|
|
|
|
97,060
|
|
|
|
82,609
|
|
Mining
royalty land
|
|
1,395
|
|
|
|
1,299
|
|
|
|
3,889
|
|
|
|
3,874
|
|
Developed
property rentals
|
|
6,284
|
|
|
|
5,615
|
|
|
|
19,026
|
|
|
|
16,150
|
|
Total
revenues
|
|
41,248
|
|
|
|
35,708
|
|
|
|
119,975
|
|
|
|
102,633
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|
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Cost of
operations:
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|
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Transportation
|
|
31,124
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25,687
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92,262
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|
|
|
75,784
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Mining
royalty land
|
|
342
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|
|
|
319
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|
|
|
1,018
|
|
|
|
945
|
|
Developed
property rentals
|
|
3,893
|
|
|
|
3,428
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|
|
|
12,358
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|
|
|
9,982
|
|
Unallocated corporate
|
|
159
|
|
|
|
204
|
|
|
|
1,337
|
|
|
|
1,136
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|
Total cost of
operations
|
|
35,518
|
|
|
|
29,638
|
|
|
|
106,975
|
|
|
|
87,847
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Operating
profit:
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|
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Transportation
|
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2,445
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|
|
|
3,107
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|
|
|
4,798
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|
|
|
6,825
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Mining
royalty land
|
|
1,053
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|
|
|
980
|
|
|
|
2,871
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|
|
|
2,929
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Developed
property rentals
|
|
2,391
|
|
|
|
2,187
|
|
|
|
6,668
|
|
|
|
6,168
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Unallocated corporate
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|
(159)
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|
|
|
(204)
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|
|
|
(1,337)
|
|
|
|
(1,136)
|
|
Total operating
profit
|
|
5,730
|
|
|
|
6,070
|
|
|
|
13,000
|
|
|
|
14,786
|
|
|
|
|
|
|
|
|
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|
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|
|
|
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Gain on investment
land sold
|
|
450
|
|
|
|
—
|
|
|
|
528
|
|
|
|
1,116
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Interest income and
other
|
|
-
|
|
|
|
—
|
|
|
|
1
|
|
|
|
37
|
|
Equity in loss of
joint ventures
|
|
(29)
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|
|
|
(11)
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|
|
|
(92)
|
|
|
|
(30)
|
|
Interest
expense
|
|
(438)
|
|
|
|
(1,137)
|
|
|
|
(1,095)
|
|
|
|
(2,145)
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|
|
|
|
|
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|
|
|
|
|
|
|
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Income before income
taxes
|
|
5,713
|
|
|
|
4,922
|
|
|
|
12,342
|
|
|
|
13,764
|
|
Provision for income
taxes
|
|
(2,228)
|
|
|
|
(1,920)
|
|
|
|
(4,813)
|
|
|
|
(5,368)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
|
3,485
|
|
|
|
3,002
|
|
|
|
7,529
|
|
|
|
8,396
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
Income
|
$
|
3,485
|
|
|
|
3,002
|
|
|
|
7,529
|
|
|
|
8,396
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
0.36
|
|
|
|
0.31
|
|
|
|
0.78
|
|
|
|
0.88
|
|
Diluted
|
|
0.36
|
|
|
|
0.31
|
|
|
|
0.78
|
|
|
|
0.88
|
|
|
|
|
|
|
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|
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Number of shares
(in thousands)
|
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used
in computing:
|
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|
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|
|
|
|
|
|
|
|
|
-basic
earnings per common share
|
|
9,651
|
|
|
|
9,549
|
|
|
|
9,613
|
|
|
|
9,511
|
|
-diluted
earnings per common share
|
|
9,718
|
|
|
|
9,625
|
|
|
|
9,700
|
|
|
|
9,592
|
|
|
|
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SOURCE Patriot Transportation Holding, Inc.