Student Transportation Inc. Reports Fiscal 2017 Third Quarter Results
BARRIE, Ontario, May 10, 2017 (GLOBE NEWSWIRE) — Student Transportation Inc. (TSX:STB) (NASDAQ:STB) (“STI” or “the Company”) today announced financial results for the third quarter of fiscal year 2017 ended March 31, 2017. All financial results are reported in U.S. dollars except as otherwise noted.
Revenue for the third quarter of fiscal 2017 increased 7 percent to $185.2 million from $173.2 million for the third quarter of fiscal 2016. STI reported net income for the third quarter of $7.9 million, or $0.08 per common share, compared to $3.8 million, or $0.04 per common share, for the third quarter of fiscal 2016. Adjusted EBITDA* increased 10 percent to $43.3 million compared to $39.3 million for the same period last year.
“We continue to be encouraged with the performance of our operations and are enthusiastic about the opportunities ahead that are setting up a promising fiscal 2018. We have been developing and implementing numerous programs and initiatives this year that are being installed to improve our operating results for the future. These do take time,” stated Denis J. Gallagher, Chairman and CEO. “We are pleased with our positive quarterly results despite severe winter weather and regional driver shortages that have created headwinds in our operations. This year we have experienced an increase in driver shortages in several markets as well as numerous school day closings due to winter weather that brought flooding, tornadoes and snowstorms. At the end of the third quarter we had approximately $6 million in deferred weather-related revenue. Historically, we have anticipated recouping a majority of that amount, however, we are at the discretion of the state and local governments regarding the number of school days they choose to make up,” Gallagher added. “Our local operating teams are working hard to improve our retention and recruiting efforts while our fleet management team is lowering maintenance cost and reducing vehicles through our new telematics software being installed which will reduce our replacement capital expenditures for fiscal 2018.”
The Company previously stated it has locked in the portion of vendor-contracted fuel for the entire fiscal 2018 at prices slightly lower than the current fiscal year.
Looking ahead Gallagher said, “We are well-positioned to expand strategically in our core contracted student transportation business in fiscal 2018 and to enhance our Managed Services Group which is a leader in management consulting and operations of the $16 billion school district owned and operated business. We have been building a team that is developing new business relations and generating new revenue streams that we can leverage. This is a new area for us and it is exciting to see the potential this group has going forward.”
As has been the norm over the past 12 years, the Board of Directors, which reviews and approves the dividend on a quarterly basis in advance, has approved the monthly cash dividend of $0.03667 per common share for the first quarter of fiscal 2018. That marks the 153rd consecutive monthly dividend announced since the Company became public in 2004. The dividend, paid in U.S. dollars, is Canadian Dividend Tax Qualified and is a Qualified Dividend in the U.S.
This month the Company will be celebrating its 20th year since its founding by Chairman and CEO Denis J. Gallagher in 1997 and will mark the occasion by participating in the NASDAQ Closing Bell Ceremony at the NASDAQ MarketSite in Times Square in New York City on May 17th at 4:00 p.m.
| Reconciliation of Net Income (loss) and Adjusted EBITDA * | |||||||||||
| Year over Year | Year over Year | ||||||||||
| (Amounts in 000’s) | Three Months Ended | Nine Months Ended | |||||||||
| 3/31/17 | 3/31/16 | 3/31/17 | 3/31/16 | ||||||||
| Net income (loss) | $7,865 | $3,769 | $2,197 | $(241 | ) | ||||||
| Add back: | |||||||||||
| Income tax expense (benefit) | 4,867 | 2,369 | 1,260 | (173 | ) | ||||||
| Foreign currency loss (gain) | (77 | ) | 561 | (91 | ) | 1,287 | |||||
| Other (income) expense, net | (1,104 | ) | 1,351 | (964 | ) | (330 | ) | ||||
| Non-cash loss (gain) on US$ 6.25% Convertible | |||||||||||
| Debentures conversion feature | – | 291 | (190 | ) | 286 | ||||||
| Equity in net loss of unconsolidated investment | – | 36 | – | 11 | |||||||
| Non-cash stock compensation | – | 983 | 5,802 | 3,967 | |||||||
| Interest expense | 4,440 | 3,833 | 13,600 | 10,821 | |||||||
| Impairment of oil and gas assets | – | – | 224 | 1,200 | |||||||
| Amortization expense | 786 | 782 | 2,360 | 2,360 | |||||||
| Depreciation and depletion expense | 14,101 | 14,345 | 33,164 | 33,727 | |||||||
| Operating lease expense | 12,433 | 11,007 | 29,002 | 25,591 | |||||||
| Adjusted EBITDA * | $43,311 | $39,327 | $86,364 | $78,506 | |||||||
| Results of Operations | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| March 31 | March 31 | |||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||
| Revenues | $185,187 | $173,241 | $464,539 | $434,004 | ||||||||
| Costs and expenses |
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