ACL shares up nearly 25 percent as Q4 earnings beat estimates

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February 9, 2010

Revenues down, but Jeffersonville-based company cut costs

By BRADEN LAMMERS The News and Tribune Tue Feb 09, 2010, 07:55 PM EST

Jeffersonville-based American Commercial Lines Inc. saw its stock price soar following the release of its fourth quarter and year-end earnings.

Shares closed Tuesday at $20.17, a 24.81 percent increase, or $4.01 jump per share.

The significant one-day increase is largely attributable to beating analysts’ estimates for the company’s earnings in the fourth quarter.

The company earned $9.3 million, or 72 cents per share, compared with a year-ago profit of $23.7 million, or $1.87 per share. The latest period was dragged down by a loss of 37 cents per share on the sale of the company’s Summit Contracting business.

Analysts polled by Thomson Reuters, who generally exclude one-time items from their estimates, were expecting a profit of just 6 cents per share on sales of $222.5 million.

“We are pleased with our fourth-quarter results, finishing 2009 on a positive note after a second straight year of difficult economic conditions,” said Michael P. Ryan, president and CEO, in a press release. “Our earnings power was greatly impacted this year as our clients shipped less to their customers, and to their own production facilities.

“With the economy beyond our control, we focused on improving the fundamentals of our business.”

Revenues fell to $226.91 million in the fourth quarter from $271.56 million in the same quarter last year, but the company offset the drop in revenue by dramatically cutting costs. Cost of sales fell to $180.5 million from $209.7 million and ACL also trimmed its selling, general and administrative expenses.

“We aggressively improved our cost structure and productivity by realigning and reducing our assets and personnel,” Ryan said. “These actions will stabilize our program in the near term and position us to reap greater financial dividends in the coming years.

“Despite all the economic turmoil, we were still able to pay down debt in 2009 after successfully refinancing our bank loan facility.”

According to an ACL press release, for the full-year 2009, average outstanding debt declined $42.6 million from the prior year and also benefited from higher after-tax net gains from asset management actions of $4.9 million.

For all of 2009, the company reported a loss of $12.1 million, or 95 cents per share, compared with a profit of

$48 million, or $3.78 per share, in 2008. Revenue fell 27 percent to $846 million from $1.16 billion in 2008 because of weaker transportation revenue and building fewer barges for sale.

However, revenues at Jeffboat, ACL’s manufacturing division, were up in the fourth quarter of 2009 to $45.2 million, compared to $37.9 million during the same period in 2008, but down for the year for $215 million for 2009 compared to $255 million for 2008.

Looking forward, six analysts surveyed on the Yahoo! Finance Web site predicted 2010 earnings of 59 cents per share. ACL does not offer earnings guidance.

— The Associated Press contributed to this report.

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ACL shares up nearly 25 percent as Q4 earnings beat estimates

Revenues down, but Jeffersonville-based company cut costs

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