Central Freight Lines, Inc. Files Form 10-K Annual Report; Announces Adjustments to Previously Reported Results
March 31 2005 - 7:12PM
PR Newswire (US)
Central Freight Lines, Inc. Files Form 10-K Annual Report;
Announces Adjustments to Previously Reported Results WACO, Texas,
March 31 /PRNewswire-FirstCall/ -- Central Freight Lines, Inc.
(NASDAQ:CENF) announced today that it has filed its annual report
on Form 10-K for the year ended December 31, 2004, within the
timeframe allowed under Rule 12b-25. As previously announced, an
extension of the filing date was requested under Rule 12b-25 to
allow Central and its outside auditors to complete the evaluation
and assessment of internal controls over financial reporting as
required by Section 404 of the Sarbanes-Oxley Act. That evaluation
and assessment was completed, and one additional material weakness
in internal control was identified, relating to the calculation of
the valuation allowance for deferred tax assets. As described
below, the valuation of the deferred tax asset was corrected by
Central prior to filing its annual report. The annual report filed
by Central today included adjustments to Central's insurance and
claims expense, income tax benefit (expense), and net loss, as well
as balance sheet adjustments, which were made after Central's press
release on March 16, 2005. The adjustments to previously announced
results that were included in the annual report are as follows: *
For the 2004 fourth quarter, Central recorded a non-cash charge of
$4.9 million, or $0.27 per diluted share, related to a valuation
allowance for deferred tax assets. Previously, Central reported
that this non-cash charge would be $2.9 million, or $0.16 per
diluted share. The previously announced amount had been established
in consultation with an independent Big Four accounting firm.
However, despite this measure, an error was discovered. * For the
2004 fourth quarter, Central recorded additional insurance and
claims expense of $690,000, or $0.04 per diluted share, based on a
jury verdict after the March 16 press release relating to a lawsuit
originally filed in 2003. Central intends to appeal the verdict but
has increased its claims accrual to reflect the award. The tax
benefit from this additional expense of $269,000 was offset by a
deferred tax valuation allowance of $269,000 which is included in
the $4.9 million valuation allowance mentioned above. After giving
effect to these adjustments, Central reported a net loss of $11.3
million, or $0.62 per diluted share, for the fourth quarter, and a
net loss of $22.8 million, or $1.27 per diluted share for 2004 as a
whole. After giving effect to the write-off of the deferred tax
asset, stockholders' equity was $87.6 million as of December 31,
2004. Central Freight Lines, Inc. is a non-union
less-than-truckload carrier specializing in regional overnight and
second day markets. One of the 10 largest regional LTL carriers in
the nation, Central provides regional, interregional, and expedited
services, as well as value-added supply chain management,
throughout the Midwest, Southwest, West Coast and Pacific
Northwest. Utilizing marketing alliances, Central provides service
solutions to the Great Lakes, Northeast, Southeast, Mexico and
Canada. This press release contains forward-looking statements that
involve risk, assumptions, and uncertainties that are difficult to
predict. Statements that constitute forward-looking statements are
usually identified by words such as "anticipates," "believes,"
"estimates," "projects," "expects," "plans," "intends," or similar
expressions. These statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Such statements are based upon the current beliefs and expectations
of our management and are subject to significant risks and
uncertainties. Actual results may differ from those set forth in
the forward-looking statements. The following factors, among
others, could cause actual results to differ materially from those
in forward-looking statements: the risk that revenue growth may be
delayed or not occur at all; the risk that improvements in revenue
yield and tonnage growth may be delayed or not occur at all; the
risk that service, safety, and productivity measures will be
further delayed or will not be successfully implemented throughout
our operations; the risk that our cost-cutting measures may have
unintended and unforeseen consequences that adversely affect our
business; the risk that recent geographic expansion has produced or
may produce freight imbalances, customer service issues,
operational issues, or other consequences that we cannot manage
successfully on a timely basis or at all; the risk that our
insurance and claims costs will continue to exceed our expectations
and will not return to acceptable levels on a timely basis or at
all; the risk that we will be unable to obtain the financing we are
seeking or that it will not be available on acceptable terms; the
risk that operating losses and negative cash flows will continue
and will have a material and adverse result; and the risks detailed
from time to time in reports filed by the Company with the
Securities and Exchange Commission, including forms 8-K, 10-Q,
10-K, and our registration statement on Form S-1. Corporate
Contact: Jeff Hale, Chief Financial Officer (480) 361-5295
http://www.newscom.com/cgi-bin/prnh/20040205/DACENTRALLOGO
http://photoarchive.ap.org/ DATASOURCE: Central Freight Lines, Inc.
CONTACT: Jeff Hale, Chief Financial Officer of Central Freight
Lines, Inc., +1-480-361-5295, or Web site:
http://www.centralfreight.com/
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