DALLAS, Sep 17, 2008 (BUSINESS WIRE) -- Dynamex Inc. (NASDAQ: DDMX): Fourth Quarter & FY 2008 Highlights:
-- 4th Quarter sales increase 9.6% to $119 million.
-- 4th Quarter net income per fully diluted share increases 17.2% to $0.45.
-- FY 2008 sales increase 10.2%, net income per fully diluted share increases 17.6% excluding the one-time benefit in the prior year.
-- Common share repurchases total 121,000 in 4th Quarter and 222,100 in August 2008.
-- Board authorizes $20 million increase in share repurchases.
Dynamex Inc. (NASDAQ: DDMX), the leading provider of same-day delivery and logistics services in the United States and Canada, today announced net income of $4.6 million or $0.45 fully diluted net income per share for the FY 2008 fourth quarter compared to $4.1 million or $0.38 fully diluted net income per share in the prior year. For the full fiscal year ended July 31, 2008, the Company reported net income of $15.8 million or $1.53 fully diluted net income per share, compared with net income of $15.0 million or $1.39 fully diluted net income per share in the prior year. The prior year includes a one-time, after-tax benefit of $972,000, $0.09 per fully diluted share, recorded in the second quarter of FY 2007 from the resolution of prior year cross-border transfer pricing issues. Excluding that adjustment from the prior year, net income per fully diluted share increased 17.6%.
Sales increased 9.6% to $119 million this quarter compared to the prior year. The exchange rate between the Canadian dollar and the U.S. dollar was approximately 6.6% higher this quarter than the same quarter last year. The Company estimates that higher fuel surcharges account for approximately 4.3% of the increase in sales. The core growth rate per day, the rate excluding changes in fuel surcharge revenues and foreign exchange, increased 3.2% this quarter. The prior year quarter includes sales of approximately $3.9 million for services provided on an interim basis to one customer in Canada. Excluding those one-time sales, the core growth rate per day would have been approximately 6.8%.
Selling, general and administrative ("SG&A") expenses increased $1.9 million, or 8.4% compared to the same quarter last year. As a percentage of sales, SG & A expenses were 20.1% in the current year compared to 20.4% in the prior year quarter. Normal wage increases as well as additional personnel required to manage and operate new business started over the last year contributed to the dollar increase in SG&A expenses.
Operating income increased 19.2% compared to the prior year quarter. Purchased transportation costs, the largest component of cost of sales represented 65.6% of sales in the current year quarter, the same percentage as the prior year quarter. Other direct cost of sales represented 7.3% of sales compared to 7.6% last year.
Income tax expense was $3.0 million, 39.6% of income before taxes in the current year quarter compared to $2.5 million, 37.9% of income before taxes in the prior year quarter. The higher income tax rate this quarter results from the higher proportion of pre-tax income generated in the U.S. than the previous year. The Company's effective income tax rate in the U.S. was approximately 41.6% and 33.2% in Canada.
Fourth Quarter Highlights
"We are pleased with our performance for both the fourth quarter and year as we continued to deliver increased top and bottom line performance despite a very difficult economic environment and an historic rise in fuel costs," said Dynamex Chairman and CEO, Rick McClelland. "Sales increased 9.6% for the quarter and 10.2% for the year while net income per fully diluted share increased 17.2% for the quarter and 17.6% for the year, excluding the one-time benefit recorded last year. During the quarter, our margins stabilized as we expected, and should remain relatively stable during the 2009 fiscal year.
"Improving shareholder value remains one of our highest priorities and we continued our share repurchase program during the quarter, purchasing 121,000 common shares," added McClelland. "Subsequent to the end of this fiscal year, we repurchased an additional 222,100 shares reducing the outstanding share count to 9.9 million. We will continue our share repurchase program in FY 2009 using excess cash from U.S. and Canadian operations. While we anticipate the repatriation of excess cash from Canada will increase our effective tax rate in the U.S. and thus result in a reduction in net income per share for the 2009 fiscal year, we believe this action is in the best overall interest of our shareholders.
"Our outlook for fiscal year 2009 continues to be positive as we believe our variable cost business model combined with our industry leading technology and North American presence provides us with a distinct competitive advantage to sustain continued profitable growth and returns for our shareholders despite current economic challenges," continued McClelland. "We expect the Canadian dollar to decline approximately 5% versus the U.S. dollar during fiscal year 2009, which will impact both sales growth and net income per share. We expect year-over-year sales growth of between 7% and 8% and net income to range from $1.50 to $1.60 per fully diluted share for fiscal 2009 reflecting the reduction in the exchange rate, a higher effective income tax rate and the one-time, special payment of $1.5 million in the first quarter of FY 2009.
"Overall, we are pleased with our results in FY 2008 and our opportunities in the year ahead," concluded McClelland. "We have a debt free business delivering strong cash flow and bottom-line returns. I am extremely proud of our employees' contributions and dedication during the year and we are very focused on improving our performance during the current fiscal year."