Exhibit 99.1

FORWARD AIR CORPORATION REPORTS
FOURTH QUARTER AND FISCAL 2009 RESULTS

GREENEVILLE, Tenn.—(BUSINESS WIRE) – February 8, 2010—Forward Air Corporation (NASDAQ:FWRD) today reported results for the fourth quarter and year ended December 31, 2009.

Operating revenue for the quarter ended December 31, 2009 decreased 4.4% to $118.0 million from $123.4 million for the same quarter in 2008.  Income from operations was $12.3 million, compared with $14.0 million for the fourth quarter of 2008, a decrease of 12.1%.  As a percent of operating revenue, income from operations decreased to 10.4% from 11.3% for the same quarter last year.  Net income during the period decreased by $1.9 million, or 22.9%, to $6.4 million from $8.3 million in the fourth quarter of 2008.  Net income per diluted share for the fourth quarter of 2009 was $0.22 compared with $0.29 in the same quarter in 2008, a decrease of 24.1%.

Operating revenue for the year ended December 31, 2009 decreased 12.0% to $417.4 million from $474.4 million for the year ended December 31, 2008.  Income from operations, which includes a first quarter non-cash, pre-tax charge of $7.2 million primarily for goodwill impairment related to the Company’s Forward Air Solutions segment, was $18.8 million, compared with $70.3 million in 2008.  Including the impact of the goodwill impairment, the Company’s net income for the year ended December 31, 2009, was $9.9 million, compared with $42.5 million in 2008.  Net income per diluted share for the year ended December 31, 2009 was $0.34 compared with $1.47 in 2008.
 
Bruce A. Campbell, Chairman, President, and CEO, said, "We are pleased with our fourth quarter results which provided an encouraging finish to a year of unprecedented challenges.  This quarter’s performance validated the positive leverage and earnings power of our model as illustrated by our airport-to-airport segment generating $5.6 million of additional operating income on $14.9 million in additional operating revenue when compared to the third quarter of 2009.  We were also pleased to see our Solutions segment return to being a solid earnings contributor despite the continuing struggles of the specialty retail sector.”
 
 
Commenting further, Mr. Campbell said, “Although we were encouraged by the trends that started at the end of the third quarter and which continued throughout the fourth quarter, we remain very cautious, yet optimistic, in our outlook for 2010.  Our yield, while stabilized, continues to suffer from competitive pricing which we expect to continue until such time as capacity is taken out of the market or demand increases from an improved economy.”
 
In closing Mr. Campbell said, “I would be remiss if I didn’t acknowledge the significant contributions and sacrifices of our team of employees and independent contractors who managed to do more with less in 2009.  We are all looking forward to taking lessons learned this past year and applying them in 2010 to produce the superior margins and returns our shareholders have come to expect from Forward Air.”

In commenting further on the fourth quarter, Rodney L. Bell, Senior Vice President and CFO, said “We produced very solid cash flows during the quarter with $19.5 million from operations compared with $21.2 in the fourth quarter of 2008.  For the year, cash flow from operations was $50.2 million compared to $59.1 million last year.  We increased our cash position during 2009 by $20.0 million to $42.0 million at year end.”

Commenting further, Mr. Bell said, “Assuming no changes in the current economic environment, we anticipate first quarter 2010 revenues to increase in the range of 6 to 10% over the prior year first quarter, and expect income per diluted share to be between $0.08 and $0.12 per share.”

 
 
 
 
Review of Financial Results

Forward Air will hold a conference call to discuss fourth quarter 2009 results on Tuesday, February 9, 2010 at 9:00 a.m. EST.  The Company’s conference call will be available online at www.forwardair.com or by dialing 800-841-9385.  A replay of the conference call will be available at www.forwardair.com beginning shortly after the completion of the live call.

About Forward Air Corporation

Forward Air Corporation operates two business segments, Forward Air, Inc. and Forward Air Solutions, Inc.

Forward Air, Inc. is a high-service-level contractor to the air cargo industry providing time-definite ground transportation services through a network of terminals located on or near major airports in 84 cities in the United States and Canada.  It provides these services as a cost-effective alternative to air transportation of cargo that must be delivered at a specific time but is relatively less time-sensitive than traditional air freight or when air transportation is not economical.

Forward Air Solutions, Inc. is a provider of pool distribution services. Pool distribution involves the consolidation and shipment of several smaller less-than-truckload shipments to a common area or region. Once at the regional destination, the loads are deconsolidated, then grouped with other shipments with common delivery points, and delivered in a very precise, time-sensitive manner. Our pool distribution network consists of terminals and service locations in 19 cities within the Mid-Atlantic, Southeast, Midwest and Southwestern United States.
 
 
2
 

 
 
Consolidated Condensed Statements of Income
  
(In thousands, except per share data)
  
(Unaudited)
  
   
 
Three months ended
    
Year ended
  
 
December 31,
    
December 31,
    
December 31,
    
December 31,
  
 
2009
    
2008
    
2009
    
2008
  
Operating revenue:
                      
Forward Air
                      
   Airport-to-airport
 $ 73,338     $ 77,713     $ 268,245     $ 334,860  
   Logistics
   15,422       16,602       54,067       59,290  
   Other
   6,100       6,669       23,076       25,133  
Forward Air Solutions
                              
   Pool distribution
   23,158       22,468       72,022       55,153  
Total operating revenue
   118,018       123,452       417,410       474,436  
                               
Operating expenses:
                              
Purchased transportation
                              
Forward Air
                              
   Airport-to-airport
   30,509       30,358       112,516       128,785  
   Logistics
   12,061       13,336       42,188       44,560  
   Other
   1,553       1,500       5,234       6,425  
Forward Air Solutions
                              
   Pool distribution
   4,715       3,551       14,490       9,315  
Total purchased transportation
   48,838       48,745       174,428       189,085  
Salaries, wages and employee benefits
   31,735       32,149       118,568       116,504  
Operating leases
   6,853       7,485       27,294       24,403  
Depreciation and amortization
   5,035       4,785       19,722       16,615  
Insurance and claims
   2,735       2,409       9,719       8,099  
Fuel expense
   2,113       2,999       7,312       11,465  
Other operating expenses
   8,441       10,834       34,424       37,980  
Impairment of goodwill and other intangible assets
   --       --       7,157       --  
Total operating expenses
   105,750       109,406       398,624       404,151  
Income from operations
   12,268       14,046       18,786       70,285  
                               
Other income (expense):
                              
   Interest expense
   (202 )     (396 )     (670 )     (1,236 )
   Other, net
   20       37       69       362  
Total other expense
   (182 )     (359 )     (601 )     (874 )
Income before income taxes
   12,086       13,687       18,185       69,411  
Income taxes
   5,658       5,350       8,239       26,869  
Net income
 $ 6,428     $ 8,337     $ 9,946     $ 42,542  
                               
Net income per share:
                              
Basic
 $ 0.22     $ 0.29     $ 0.34     $ 1.48  
Diluted
 $ 0.22     $ 0.29     $ 0.34     $ 1.47  
Weighted average shares outstanding:
                              
Basic
   28,943       28,889       28,928       28,808  
Diluted
   29,041       28,987       28,993       29,025  
                               
Dividends per share:
 $ 0.07     $ 0.07     $ 0.28     $ 0.28  
 
 
3
 

 
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
       
 
December 31,
  
December 31,
 
2009
  
2008 (a)
Assets
      
Current assets:
      
   Cash
 $ 42,035   $ 22,093
   Accounts receivable, net
   55,720     57,206
   Other current assets
   9,379     12,290
Total current assets
   107,134     91,589
           
Property and equipment
   204,716     186,377
Less accumulated depreciation and amortization
   75,990     63,401
Total property and equipment, net
   128,726     122,976
Goodwill and other acquired intangibles:
          
   Goodwill
   43,332     50,230
   Other acquired intangibles, net
   35,849     40,708
Total goodwill and other acquired intangibles
   79,181     90,938
Other assets
   1,597     2,024
Total assets
 $ 316,638   $ 307,527
           
           
           
Liabilities and Shareholders’ Equity
          
Current liabilities:
          
   Accounts payable
 $ 10,333   $ 11,633
   Accrued expenses
   18,295     12,927
   Current portion of debt and capital lease obligations
   919     1,602
Total current liabilities
   29,547     26,162
           
Debt and capital lease obligations, less current portion
   52,169     53,035
Other long-term liabilities
   4,485     3,055
Deferred income taxes
   5,786     8,841
           
Shareholders’ equity:
          
   Common stock
   290     289
   Additional paid-in capital
   16,631     10,249
   Retained earnings
   207,730     205,896
Total shareholders’ equity
   224,651     216,434
Total liabilities and shareholders’ equity
 $ 316,638   $ 307,527

(a) Taken from audited financial statements, which are not presented in their entirety.
 
 
4
 

 
 
Condensed Consolidated Statements of Cash Flows
  
(In thousands)
  
(Unaudited)
  
           
 
Three Months Ended
  
 
December 31,
    
December 31,
  
 
2009
    
2008
  
Operating activities:
          
Net income
 $ 6,428     $ 8,337  
Adjustments to reconcile net income to net cash provided by operating activities
              
   Depreciation and amortization
   5,035       4,785  
   Share-based compensation
   1,732       1,695  
   Gain on disposal of property and equipment
   7       135  
   Provision for loss on receivables
   14       658  
   Provision for revenue adjustments
   474       986  
   Deferred income taxes
   (1,110 )     516  
   Tax expense for stock options exercised
   371       118  
   Changes in operating assets and liabilities, net of acquisitions
              
      Accounts receivable
   (3,214 )     13,716  
      Prepaid expenses and other current assets
   2,115       (170 )
      Accounts payable and accrued expenses
   7,620       (9,715 )
Net cash provided by operating activities
   19,472       21,061  
               
Investing activities:
              
Proceeds from disposal of property and equipment
   39       41  
Purchases of property and equipment
   (2,019 )     (14,019 )
Acquisition of businesses
   --       (267 )
Other
   (33 )     157  
Net cash used in investing activities
   (2,013 )     (14,088 )
               
Financing activities:
              
Payments of debt and capital lease obligations
   (386 )     (431 )
Payments of cash dividends
   (2,028 )     (2,027 )
Common stock issued under employee stock purchase plan
   138       110  
Cash settlement of share-based awards for minimum tax withholdings
   (7 )     (5 )
Tax expense for stock options exercised
   (371 )     (118 )
Net cash used in financing activities
   (2,654 )     (2,471 )
Net increase in cash
   14,805       4,502  
Cash at beginning of period
   27,230       17,591  
Cash at end of period
 $ 42,035     $ 22,093  
 
 
5
 

 
 
Condensed Consolidated Statements of Cash Flows
  
(In thousands)
  
(Unaudited)
  
           
 
Year ended
  
 
December 31,
    
December 31,
  
 
2009
    
2008
  
Operating activities:
          
Net income
 $ 9,946     $ 42,542  
Adjustments to reconcile net income to net cash provided by operating activities
              
   Depreciation and amortization
   19,722       16,615  
   Impairment of goodwill and other intangible assets
   7,157       --  
   Share-based compensation
   6,754       6,267  
   (Gain) loss on disposal of property and equipment
   (6 )     171  
   Provision for (recovery) loss on receivables
   (60 )     903  
   Provision for revenue adjustments
   2,390       4,259  
   Deferred income taxes
   (4,119 )     1,151  
   Tax expense (benefit) for stock options exercised
   370       (1,030 )
   Changes in operating assets and liabilities, net of acquisitions
              
      Accounts receivable
   (844 )     (2,376 )
      Prepaid expenses and other current assets
   548       (2,102 )
      Accounts payable and accrued expenses
   8,321       (7,317 )
Net cash provided by operating activities
   50,179       59,083  
               
Investing activities:
              
Proceeds from disposal of property and equipment
   270       87  
Purchases of property and equipment
   (20,847 )     (26,699 )
Acquisition of businesses
   --       (29,566 )
Other
   372       (10 )
Net cash used in investing activities
   (20,205 )     (56,188 )
               
Financing activities:
              
Payments of debt and capital lease obligations
   (1,549 )     (1,603 )
Borrowings on line of credit
   --       45,000  
Payments on line of credit
   --       (25,000 )
Proceeds from exercise of stock options
   8       3,085  
Payments of cash dividends
   (8,109 )     (8,089 )
Common stock issued under employee stock purchase plan
   237       255  
Cash settlement of share-based awards for minimum tax withholdings
   (249 )     (389 )
Tax (expense) benefit for stock options exercised
   (370 )     1,030  
Net cash (used in) provided by financing activities
   (10,032 )     14,289  
Net increase in cash
   19,942       17,184  
Cash at beginning of period
   22,093       4,909  
Cash at end of period
 $ 42,035     $ 22,093  

 
6
 


Forward Air Corporation
Segment Information
(In millions)
(Unaudited)
 
 
Three months ended
    
 
December 31,
    
Percent of
    
December 31,
    
Percent of
          
Percent
    
 
2009
    
Revenue
    
2008
    
Revenue
    
Change
    
Change
    
Operating revenue
                                    
      Forward Air
 $ 95.1     80.6 %   $ 101.4     82.2 %   $ (6.3 )   (6.2 ) %
      FASI
   23.3     19.7       22.5     18.2       0.8     3.6    
      Intercompany Eliminations
   (0.4 )   (0.3 )     (0.5 )   (0.4 )     0.1     (20.0 )  
            Total
   118.0     100.0       123.4     100.0       (5.4 )   (4.4 )  
                                           
Purchased transportation
                                          
      Forward Air
   44.2     46.5       45.3     44.7       (1.1 )   (2.4 )  
      FASI
   5.0     21.4       3.9     17.3       1.1     28.2    
      Intercompany Eliminations
   (0.4 )   100.0       (0.5 )   100.0       0.1     (20.0 )  
            Total
   48.8     41.4       48.7     39.5       0.1     0.2    
                                           
Salaries, wages and employee benefits
                                          
      Forward Air
   22.4     23.6       22.2     21.9       0.2     0.9    
      FASI
   9.3     39.9       9.9     44.0       (0.6 )   (6.1 )  
            Total
   31.7     26.9       32.1     26.0       (0.4 )   (1.2 )  
                                           
Operating leases
                                          
      Forward Air
   4.6     4.8       4.9     4.8       (0.3 )   (6.1 )  
      FASI
   2.3     9.9       2.6     11.6       (0.3 )   (11.5 )  
            Total
   6.9     5.8       7.5     6.1       (0.6 )   (8.0 )  
                                           
Depreciation and amortization
                                          
      Forward Air
   4.1     4.3       3.8     3.7       0.3     7.9    
      FASI
   0.9     3.9       1.0     4.4       (0.1 )   (10.0 )  
            Total
   5.0     4.2       4.8     3.9       0.2     4.2    
                                           
Insurance and claims
                                          
      Forward Air
   2.1     2.2       2.2     2.2       (0.1 )   (4.5 )  
      FASI
   0.7     3.0       0.2     0.9       0.5     250.0    
            Total
   2.8     2.4       2.4     2.0       0.4     16.7    
                                           
Fuel expense
                                          
      Forward Air
   0.8     0.8       1.0     1.0       (0.2 )   (20.0 )  
      FASI
   1.3     5.6       2.0     8.9       (0.7 )   (35.0 )  
            Total
   2.1     1.8       3.0     2.4       (0.9 )   (30.0 )  
                                           
Other operating expenses
                                          
      Forward Air
   6.6     7.0       8.5     8.4       (1.9 )   (22.4 )  
      FASI
   1.8     7.7       2.4     10.7       (0.6 )   (25.0 )  
            Total
   8.4     7.1       10.9     8.8       (2.5 )   (22.9 )  
                                           
Income from operations
                                          
      Forward Air
   10.3     10.8       13.5     13.3       (3.2 )   (23.7 )  
      FASI
   2.0     8.6       0.5     2.2       1.5     300.0    
            Total
 $ 12.3     10.4 %   $ 14.0     11.3 %   $ (1.7 )   (12.1 ) %

 
7
 
 

Forward Air Corporation
Segment Information
(In millions)
(Unaudited
 
 
Year ended
    
 
December 31,
    
Percent of
    
December 31,
    
Percent of
          
Percent
    
 
2009
    
Revenue
    
2008
    
Revenue
    
Change
    
Change
    
Operating revenue
                                    
      Forward Air
 $ 346.3     83.0 %   $ 421.2     88.8 %   $ (74.9 )   (17.8 ) %
      FASI
   72.5     17.4       55.3     11.6       17.2     31.1    
      Intercompany Eliminations
   (1.4 )   (0.4 )     (2.1 )   (0.4 )     0.7     (33.3 )  
            Total
   417.4     100.0       474.4     100.0       (57.0 )   (12.0 )  
                                           
Purchased transportation
                                          
      Forward Air
   160.3     46.3       179.9     42.7       (19.6 )   (10.9 )  
      FASI
   15.4     21.2       11.2     20.2       4.2     37.5    
      Intercompany Eliminations
   (1.3 )   92.9       (2.1 )   100.0       0.8     (38.1 )  
            Total
   174.4     41.8       189.0     39.9       (14.6 )   (7.7 )  
                                           
Salaries, wages and employee benefits
                                          
      Forward Air
   85.5     24.7       92.5     22.0       (7.0 )   (7.6 )  
      FASI
   33.1     45.6       24.0     43.4       9.1     37.9    
            Total
   118.6     28.4       116.5     24.6       2.1     1.8    
                                           
Operating leases
                                          
      Forward Air
   18.7     5.4       18.5     4.4       0.2     1.1    
      FASI
   8.6     11.9       5.9     10.7       2.7     45.8    
            Total
   27.3     6.5       24.4     5.1       2.9     11.9    
                                           
Depreciation and amortization
                                          
      Forward Air
   16.1     4.6       14.4     3.4       1.7     11.8    
      FASI
   3.6     5.0       2.2     4.0       1.4     63.6    
            Total
   19.7     4.7       16.6     3.5       3.1     18.7    
                                           
Insurance and claims
                                          
      Forward Air
   7.6     2.2       7.3     1.7       0.3     4.1    
      FASI
   2.1     2.9       0.8     1.4       1.3     162.5    
            Total
   9.7     2.3       8.1     1.7       1.6     19.8    
                                           
Fuel expense
                                          
      Forward Air
   3.1     0.9       5.8     1.4       (2.7 )   (46.6 )  
      FASI
   4.2     5.8       5.7     10.3       (1.5 )   (26.3 )  
            Total
   7.3     1.8       11.5     2.4       (4.2 )   (36.5 )  
                                           
Other operating expenses
                                          
      Forward Air
   27.7     8.0       32.1     7.6       (4.4 )   (13.7 )  
      FASI
   6.8     9.4       5.9     10.7       0.9     15.3    
      Intercompany Eliminations
   (0.1 )   7.1       --     --       (0.1 )   100.0    
            Total
   34.4     8.3       38.0     8.0       (3.6 )   (9.5 )  
                                           
Impairment of goodwill
                                          
and other intangible assets
                                          
      Forward Air
   0.2     0.1       --     --       0.2     100.0    
      FASI
   7.0     9.6       --     --       7.0     100.0    
            Total
   7.2     1.7       --     --       7.2     100.0    
                                           
Income (loss) from operations
                                          
      Forward Air
   27.1     7.8       70.7     16.8       (43.6 )   (61.7 )  
      FASI
   (8.3 )   (11.4 )     (0.4 )   (0.7 )     (7.9 )   1,975.0    
            Total
 $ 18.8     4.5 %   $ 70.3     14.8 %   $ (51.5 )   (73.3 ) %
 
 
8
 
 
 
Forward Air Inc. Operating Statistics
                                       
                                       
 
Three months ended
      
Year ended
    
 
December 31,
    
December 31,
    
Percent
      
December 31,
    
December 31,
    
Percent
    
 
2009
    
2008
    
Change
      
2009
    
2008
    
Change
    
                                       
Operating ratio
   89.2 %     86.7 %   (2.9 ) %     92.2 %     83.2 %   (10.8 ) %
                                               
Business days
   64.0       63.0     1.6   %      255.0       255.0     --    
Business weeks
   12.8       12.6     1.6   %      51.0       51.0     --    
                                               
                                               
Airport-to-airport:
                                              
Tonnage
                                              
    Total pounds ¹
   398,921       407,162     (2.0 )       1,452,969       1,743,963     (16.7 )  
    Average weekly pounds ¹
   31,166       32,314     (3.6 )       28,490       34,195     (16.7 )  
                                               
Linehaul shipments
                                              
    Total linehaul
   565,922       557,260     1.6         2,095,223       2,295,299     (8.7 )  
    Average weekly
   44,213       44,227     (0.1 )       41,083       45,006     (8.7 )  
                                               
Forward Air Complete shipments
   71,442       56,930     25.5         266,136       202,382     31.5    
As a percentage of linehaul shipments
   12.6 %     10.2 %   23.5         12.7 %     8.8 %   44.3    
                                               
Average linehaul shipment size
   705       731     (3.5 )       693       760     (8.8 )  
                                               
Revenue per pound ²
                                              
    Linehaul yield
   15.84       16.52     (3.5 )       16.06       16.55     (2.5 )  
    Fuel surcharge impact
   0.96       1.43     (2.5 )       0.84       1.72     (4.6 )  
    Forward Air Complete impact
   1.62       1.21     2.1         1.60       1.01     3.1    
Total airport-to-airport yield
   18.42       19.16     (3.9 )       18.50       19.28     (4.0 )  
                                               
                                               
Logistics:
                                              
Miles
                                              
    Owner operator ¹
   6,421       5,408     18.7         24,338       18,840     29.2    
    Third party ¹
   3,220       4,605     (30.1 )       9,929       15,660     (36.6 )  
Total Miles
   9,641       10,013     (3.7 )       34,267       34,500     (0.7 )  
                                               
Revenue per mile
 $ 1.62     $ 1.69     (4.1 )     $ 1.59     $ 1.74     (8.6 )  
 
                                              
Cost per mile
 $ 1.25     $ 1.33     (6.0 ) %   $ 1.23     $ 1.29     (4.7 ) %
                                               
                                               
¹ - In thousands
                        
² - In cents per pound; percentage change is expressed as a percent of total yield.
                        

 
9
 

Important Information

This press release contains “forward-looking statements,” as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Forward-looking statements are statements other than historical information or statements of current condition and relate to future events or our future financial performance.  Some forward-looking statements may be identified by use of such terms as “believes,” “anticipates,” “intends,” “plans,” “estimates,” “projects” or “expects.”  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  The following is a list of factors, among others, that could cause actual results to differ materially from those contemplated by the forward-looking statements: economic factors such as recessions, inflation, higher interest rates and downturns in customer business cycles, our inability to maintain our historical growth rate because of a decreased volume of freight moving through our network or decreased average revenue per pound of freight moving through our network, increasing competition and pricing pressure, surplus inventories, loss of a major customer, the creditworthiness of our customers and their ability to pay for services rendered, our ability to secure terminal facilities in desirable locations at reasonable rates, the inability of our information systems to handle an increased volume of freight moving through our network, changes in fuel prices, claims for property damage, personal injuries or workers’ compensation, employment matters including rising health care costs, enforcement of and changes in governmental regulations, environmental and tax matters, the handling of hazardous materials, the availability and compensation of qualified independent owner-operators and freight handlers needed to serve our transportation needs and our inability to successfully integrate acquisitions.  As a result of the foregoing, no assurance can be given as to future financial condition, cash flows or results of operations.  We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

-END-
 
CONTACT:    
 
 
Forward Air Corporation
 
 
Rodney L. Bell, 423-636-7000
 
 
rbell@forwardair.com