Cliff's Announcement and Company Transition

Bologna. Or boloney. Whichever you prefer.

 

Whats all this breaking the dress code everyone is complaining about? The worst I ever see is people wearing shorts. I wear shorts too and will continue to do so.

 

Drivers were on the greyhound,

heading to orientation,

when Arrow trucking locked the gates.


If you don't want to read the writing on the wall,

at least keep bus fare in your wallet......

 

Uh Huh. I always kept those fuel tanks full too. Just in case the cards were shut off.

 

I don't care about shorts, I wear them too but I am still professional when I am wearing them. It doesn't matter quite what you are wearing. Putting a bow tie on a pig is still a pig. Number 1 an inspection should be done on all trucks, inside and out. If its nasty inside u get a warning, next time you are gone. You should look like you shower and brush your teeth or tooth which ever it is at least every other day! If you get out of your truck and look like popcorn sutton or homie gang member number 20 check yourself. Look professional, act professional and you would be surprised how professional you will be treated. And for those that don't know popcorn sutton is an old decrepit looking character from the show moonshine

 

I just saw this article after doing a search using USA Truck news, interesting.





The financial struggles at Van Buren-based USA Truck are likely to continue and another attempt could be made to buy out the company, according to Alex Gray, founder of Grayvest and a private investor with more than 20 years of private equity experience.
Also, Jack Waldo, a transportation industry analyst with Little Rock-based Stephens Inc., is lowering his financial outlook for USA Truck.
And it's not just market watchers who have less than rosy views of the company.
USA Truck issued its 10Q ' quarterly federal filing required by the U.S. Securities & Exchange Commission ' on Thursday (Aug. 9) saying it has already paid $100,000 for breach of covenants with lenders, and will pay another $300,000 penalty if a new credit agreement is not reached by Aug. 24.
Company officials do not believe, according to the 10Q, that its third quarter results will help resolve its debt situation.
"We do not believe that we will be in compliance with all of our covenants based upon our September 30, 2012 results," USA Truck officials noted in the 10Q. "Commencing September 7, 2012, and at various dates through October 31, 2012, we must take further steps to protect the interests of our existing lenders if the Credit Agreement is not refinanced by such dates."
For the first six months of 2012, the company has lost $8.359 million, more than the $2.118 million lost during the same period of 2011.
USA Truck posted a 2011 net income loss of $10.777 million, more than triple the loss during 2010 and in a year when other trucking companies are beginning to see improved financials. Also, 2011 marked the third consecutive year of losses for USA Truck. In 2010, the company reported a loss of $3.308 million, and a $7.177 million loss in 2009.
BOARD CRITICISM
In an Aug. 6 note at Seeking Alpha, Gray was critical of USA Truck management for not considering an acquisition offer from Indianapolis-based Celadon Group. He also encouraged investors to stay away from buying USA Truck shares.
Executives with Celadon Trucking Services announced Oct. 11 an interest in acquiring or merging with USA Truck, and asked USA Truck management to meet about a possible transaction. At risk in a possible deal would be the about 500 jobs at USA Truck's corporate headquarters in Van Buren.
On Oct. 21, the USA Truck board said it was not interested in a deal with Celadon. On Feb. 28, Celadon sold its USA Truck shares, effectively ending the takeover attempt.
"Given the continued struggles at (USA Truck) and its inability to deliver value to the shareholders, it is inexcusable that they would simply blow off a meeting with CGI (Celadon) to discuss what possibilities might exist," Gray said in the note. "It is hard to say if CGI would have put an offer on the table after the discussions, but if they had, it seems likely the offer would have been at least double the current trading price."
Gray believes another company will come calling on USA Truck, "but there is certainly the risk of more downside before a potential suitor shows its hand."
"(A)t some point in an industry looking for revenues, USAK will be attractive to other suitors. I would recommend to the USAK Board of Directors that if CGI or any other suitor should come calling ... Answer the phone and take the meeting," Gray noted.



USA Truck declined to comment on Gray's assessment.
'CLOUDY' FUTURE
Waldo, the analyst with Stephens Inc., said in a July 27 note that he is lowering his share price target from $8 to $6.
"An increasingly cloudy macro environment complicates visibility into how quickly USAK can address challenges in achieving adequate volume to cover its fixed cost network and return to profitability," Waldo explained. "Given these concerns, we remain comfortable with our Equal-Weight rating and have reduced our PT to $6 (was $8)."




Waldo also pointed to equipment utilization problems for USA Truck.
"A competitive market for hiring and retaining drivers led to an average unmanned tractor count of 12.2% of total fleet, peaking at 14.1% and adding to the headwinds created by a softening economy."
Shares of USA Truck (NASDAQ: USAK) closed Thursday at $4.14, up 2 cents from the opening trade. During the past 52 weeks the share price has ranged from an $11.48 high to a $4 low.

 

I have caught a lot of grief for reminding all you current USA Truck drivers to make sure you have enough money to get home from anywhere in the country. Take a look at the Arrow forum and read about how quick the end came and how some drivers were left stranded by Arrow. I am not trying to say this is a 100% certainty but the near future does not look good. In my last post this statement was made

(We do not believe that we will be in compliance with all of our covenants based upon our September 30, 2012 results,” USA Truck officials noted in the 10Q. “Commencing September 7, 2012, and at various dates through October 31, 2012, we must take further steps to protect the interests of our existing lenders if the Credit Agreement is not refinanced by such dates.)

I have no idea what the company would do if this happens, but it's a VERY serious situation and there is no telling how it will end.

 

Has any of you current drivers noticed any lost accounts over the last few weeks? I am now on home time, but yesterday morning while getting unloaded I was speaking with the check in guy while I was waiting on my paperwork. We were discussing the problems at USA Truck and while he would not say who he told me several of the brokers they deal with have dropped USA Truck as too risky. Just wondering if any of you guys have heard any scuttlebutt about this?

 

Its simple. USA Truck will have to file bankruptcy should they not get in compliance. That is the only way to do it. And yes all driver should make sure they have enough money to make it home should they go out because if they go out the drivers will be left on their own. Even if USA truck had the intention to get you home the money won't be there to do so.

Something unrelated to this that I wanted to point out to everyone. Cliff is always touting the USA SCS segment of the company for its "Continued improvement". He points this out as a positive note. What he doesn't come right out and say is that the SCS segment is not an outside revenue generating business. It is intercompany run. He kind of hints at it but USA truck is the number one and the "MAIN" customer of this segment. Which means that USA truck is funneling most of the revenue to SCS from their trucking operation. No mistake should be made here. The only source of true revenue for USA truck remains its financially failing trucking operation. Another thing. He touts the increased revenue per tractor. This is what he doesn't tell you. The revenue per tractor increases because of the decline in manned tractors which means there are less tractors serving the current customers. In order to find someone to finance more debt for them Cliff has to be able to convince them that USA truck can and will be able to increase their revenue and be able to stay out of default. The only way to do this is to point out what he thinks should be positives. However the banks are smarter than this and will be able to see what is true top line revenue and what is not.

 

Any company that looks to take USA truck over will have to take on their debt as well. Anyone know any outfits out there who are willing to add 130 mil to their personal debt load? You have to hedge the debt load against the cost if you were to acquire all USAs equiptment and facilities on your own. Lets say in a bulk price a trucking outfit gets a new prostar for 90 to 100 thousand dollars. For 130 mil you can get between 1300 and 1400 new tractors. By taking over USA truck you get over 2000 tractors and whatever still commisionable trailers they have. Then there is cost of repainting the equiptment with your company logo. My guess is taking over USA truck would either make this a wash or maybe a buyer would come out slightly ahead. USA truck is selling themselves to potential buyers at this point. If there was a bank out there willing to give them credit I would question the ability of that financial institution to make decisions.