Exhibit 99.1
NEWS RELEASE

FORWARD AIR CORPORATION REPORTS
THIRD QUARTER 2011 RESULTS

GREENEVILLE, Tenn.— (BUSINESS WIRE) – October 19, 2011 - Forward Air Corporation (NASDAQ:FWRD) today reported revenue, operating income, net income and diluted earnings per share for the third quarter and nine months ended September 30, 2011.

Operating revenue for the quarter ended September 30, 2011 increased 11.7% to $135.7 million from $121.5 million for the same quarter in 2010.  Income from operations was $20.3 million for the third quarter of 2011, compared with $15.5 million in the prior-year quarter.  As a percent of operating revenue, income from operations increased to 15.0% in the third quarter of 2011 from 12.8% for the same quarter last year.  Net income during the third quarter of 2011 increased to $12.9 million from $8.9 million in the prior-year quarter.  Income per diluted share for the third quarter of 2011 was $0.44 compared with $0.31 in the prior-year quarter.

Operating revenue for the nine months ended September 30, 2011 increased 10.7% to $388.1 million from $350.6 million for the same period in 2010.  Income from operations was $53.5 million for the first nine months of 2011, compared with $35.1 million in the prior-year period.  As a percent of operating revenue, income from operations increased to 13.8% for the nine months ended September 30, 2011 from 10.0% for the same period in 2010.  Net income during the period was $32.8 million compared to $20.2 million in the prior-year period.  Income per diluted share for the nine months ended September 30, 2011 was $1.11 compared with $0.69 in the prior-year period.

Bruce A. Campbell, Chairman, President, and CEO, commenting on the third quarter said, “We are pleased to announce another quarter of outstanding operating performance. As compared to the third quarter of 2010, our nearly 12% increase in operating revenue translated to approximately 34% of incremental profit, once again demonstrating the significant leverage of our operating model.”
 
Commenting further, Mr. Campbell said, “We started the quarter with some intermittent softness in network volumes. Over the course of the quarter, tonnage firmed up very nicely ending the quarter with system tonnage up 9.5% for the month of September as compare to September one year ago. We would characterize current volume trends as being moderately better than normal seasonality.”

In closing, Mr. Campbell said, “As always, I would like to express my gratitude for the ongoing efforts of our employees and independent contractors whose hard work made these results possible.”

Also commenting on the quarter, Rodney L. Bell, Senior Vice President and CFO said, “Cash for the quarter declined $8.7 million to $87.5 million. Cash flow from operations was an impressive $22.3 million in the third quarter of 2011 as compared to $19.0 million in the third quarter of 2010. Toward the end of the quarter, we took advantage of our undervalued stock price to repurchase 904,729 shares of our company stock for $24.3 million with an average share price of $26.88.”

Commenting further, Mr. Bell said, “Included in our third quarter results we booked an approximately $0.02 per share benefit related to federal income taxes. This resulted primarily from the reinstatement of an expired alternative energy tax credit related to our use of propane. The credit, covering 2010 and year to date through the third quarter 2011, was for approximately $0.6 million. We anticipate our fourth quarter 2011 tax rate to be approximately 39.5%.”
 
Commenting on the Company’s guidance for the fourth quarter, Mr. Bell said, “We anticipate that our fourth quarter 2011 revenues will increase in the range of 10% to 14% over the comparable 2010 period, and we expect income per diluted share to be between $0.47 and $0.51 per share. This compares to $0.41 per share in the fourth quarter of 2010.”
 
 
 
 
 
Review of Financial Results

Forward Air will hold a conference call to discuss third quarter 2011 results on Thursday, October 20, 2011 at 9:00 a.m. EDT.  The Company’s conference call will be available online at www.forwardair.com or by dialing 800.230.1085.  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 85 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
 
 
Forward Air Corporation
  
Condensed Consolidated Statements of Operations
  
(In thousands, except per share data)
  
(Unaudited)
  
               
 
Three months ended
    
Nine months ended
  
 
September 30,
    
September 30,
    
September 30,
    
September 30,
  
 
2011
    
2010
    
2011
    
2010
  
Operating revenue:
                      
Forward Air
                      
   Airport-to-airport
 $ 92,966     $ 81,828     $ 266,606     $ 234,456  
   Logistics
   18,409       16,774       52,909       47,789  
   Other
   7,250       6,481       20,524       18,745  
Forward Air Solutions
                              
   Pool distribution
   17,124       16,439       48,104       49,639  
Total operating revenue
   135,749       121,522       388,143       350,629  
                               
Operating expenses:
                              
Purchased transportation
                              
Forward Air
                              
   Airport-to-airport
   36,142       32,852       104,411       94,152  
   Logistics
   14,041       12,942       40,214       36,780  
   Other
   1,797       1,703       4,929       4,811  
Forward Air Solutions
                              
   Pool distribution
   4,109       3,680       11,067       10,625  
Total purchased transportation
   56,089       51,177       160,621       146,368  
Salaries, wages and employee benefits
   33,402       31,845       95,336       95,682  
Operating leases
   6,672       6,508       20,083       19,388  
Depreciation and amortization
   5,429       5,228       15,734       15,283  
Insurance and claims
   2,120       1,546       6,140       5,983  
Fuel expense
   2,406       1,949       7,357       6,051  
Other operating expenses
   9,311       7,764       29,390       26,813  
Total operating expenses
   115,429       106,017       334,661       315,568  
Income from operations
   20,320       15,505       53,482       35,061  
                               
Other income (expense):
                              
   Interest expense
   (131 )     (191 )     (468 )     (557 )
   Other, net
   10       26       57       38  
Total other expense
   (121 )     (165 )     (411 )     (519 )
Income before income taxes
   20,199       15,340       53,071       34,542  
Income taxes
   7,287       6,452       20,321       14,323  
Net income
 $ 12,912     $ 8,888     $ 32,750     $ 20,219  
                               
Net income per share:
                              
Basic
 $ 0.44     $ 0.31     $ 1.12     $ 0.70  
Diluted
 $ 0.44     $ 0.31     $ 1.11     $ 0.69  
Weighted average shares outstanding:
                              
Basic
   29,237       29,000       29,236       28,975  
Diluted
   29,552       29,129       29,591       29,101  
                               
Dividends per share:
 $ 0.07     $ 0.07     $ 0.21     $ 0.21  
 
 
 
3
 
 
Forward Air Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
       
 
September 30,
  
December 31,
 
2011
  
2010 (a)
Assets
      
Current assets:
      
   Cash
 $ 87,467   $ 74,504
   Accounts receivable, net
   69,574     62,763
   Other current assets
   11,836     8,696
Total current assets
   168,877     145,963
           
Property and equipment
   224,278     213,704
Less accumulated depreciation and amortization
   91,023     87,272
Total property and equipment, net
   133,255     126,432
Goodwill and other acquired intangibles:
          
   Goodwill
   43,332     43,332
   Other acquired intangibles, net
   27,816     31,259
Total goodwill and other acquired intangibles
   71,148     74,591
Other assets
   1,533     1,810
Total assets
 $ 374,813   $ 348,796
           
Liabilities and Shareholders’ Equity
          
Current liabilities:
          
   Accounts payable
 $ 14,603   $ 10,687
   Accrued expenses
   18,035     16,280
   Current portion of debt and capital lease obligations
   561     638
Total current liabilities
   33,199     27,605
           
Debt and capital lease obligations, less current portion
   50,473     50,883
Other long-term liabilities
   8,079     8,106
Deferred income taxes
   12,169     6,116
           
Shareholders’ equity:
          
   Common stock
   285     290
   Additional paid-in capital
   12,552     24,300
   Retained earnings
   258,056     231,496
Total shareholders’ equity
   270,893     256,086
Total liabilities and shareholders’ equity
 $ 374,813   $ 348,796
 
(a)  Taken from audited financial statements, which are not presented in their entirety.
 
 
4
 

Forward Air Corporation
  
Condensed Consolidated Statements of Cash Flows
  
(In thousands)
  
(Unaudited)
  
           
 
Three months ended
  
 
September 30,
    
September 30,
  
 
2011
    
2010
  
Operating activities:
          
Net income
 $ 12,912     $ 8,888  
Adjustments to reconcile net income to net cash provided by operating activities
              
   Depreciation and amortization
   5,429       5,228  
   Share-based compensation
   1,502       1,506  
   Gain on disposal of property and equipment
   (76 )     (641 )
   Provision for loss (recovery) on receivables
   45       (22 )
   Provision for revenue adjustments
   547       625  
   Deferred income taxes
   4,140       40  
   Tax benefit for stock options exercised
   (13 )     (19 )
   Changes in operating assets and liabilities
              
      Accounts receivable
   (387 )     500  
      Prepaid expenses and other current assets
   (82 )     (415 )
      Accounts payable and accrued expenses
   (1,746 )     3,260  
Net cash provided by operating activities
   22,271       18,950  
               
Investing activities:
              
Proceeds from disposal of property and equipment
   330       1,371  
Purchases of property and equipment
   (4,851 )     (3,150 )
Other
   15       30  
Net cash used in investing activities
   (4,506 )     (1,749 )
               
Financing activities:
              
Payments of debt and capital lease obligations
   (160 )     (232 )
Proceeds from exercise of stock options
   90       346  
Payments of cash dividends
   (2,066 )     (2,031 )
Repurchase of common stock
   (24,294 )     --  
Tax benefit for stock options exercised
   13       19  
Net cash used in financing activities
   (26,417 )     (1,898 )
Net (decrease) increase in cash
   (8,652 )     15,303  
Cash at beginning of period
   96,119       47,916  
Cash at end of period
 $ 87,467     $ 63,219  

 
 
5
 
 
Forward Air Corporation
  
Condensed Consolidated Statements of Cash Flows
  
(In thousands)
  
(Unaudited)
  
           
 
Nine months ended
  
 
September 30,
    
September 30,
  
 
2011
    
2010
  
Operating activities:
          
Net income
 $ 32,750     $ 20,219  
Adjustments to reconcile net income to net cash provided by operating activities
              
   Depreciation and amortization
   15,734       15,283  
   Share-based compensation
   4,457       4,887  
   Gain on disposal of property and equipment
   (76 )     (648 )
   Provision for loss on receivables
   17       202  
   Provision for revenue adjustments
   1,480       1,462  
   Deferred income taxes
   6,079       (1,624 )
   Tax benefit for stock options exercised
   (232 )     (28 )
   Changes in operating assets and liabilities
              
      Accounts receivable
   (8,308 )     (8,382 )
      Prepaid expenses and other current assets
   (1,828 )     (1,029 )
      Accounts payable and accrued expenses
   4,757       7,519  
Net cash provided by operating activities
   54,830       37,861  
               
Investing activities:
              
Proceeds from disposal of property and equipment
   997       1,413  
Purchases of property and equipment
   (20,292 )     (11,889 )
Other
   316       --  
Net cash used in investing activities
   (18,979 )     (10,476 )
               
Financing activities:
              
Payments of debt and capital lease obligations
   (488 )     (722 )
Proceeds from exercise of stock options
   7,721       490  
Payments of cash dividends
   (6,187 )     (6,088 )
Repurchase of common stock
   (24,294 )     --  
Common stock issued under employee stock purchase plan
   128       91  
Tax benefit for stock options exercised
   232       28  
Net cash used in financing activities
   (22,888 )     (6,201 )
Net increase in cash
   12,963       21,184  
Cash at beginning of period
   74,504       42,035  
Cash at end of period
 $ 87,467     $ 63,219  
 
 
6
 
 
Forward Air Corporation
  
Segment Information
  
(In millions)
  
(Unaudited)
  
   
 
Three months ended
  
 
September 30,
    
Percent of
    
September 30,
    
Percent of
          
Percent
  
 
2011
    
Revenue
    
2010
    
Revenue
    
Change
    
Change
  
Operating revenue
                                  
      Forward Air
 $ 118.9     87.6 %   $ 105.3     86.7 %   $ 13.6     12.9 %
      FASI
   17.2     12.7       16.5     13.6       0.7     4.2  
      Intercompany Eliminations
   (0.4 )   (0.3 )     (0.3 )   (0.3 )     (0.1 )   33.3  
            Total
   135.7     100.0       121.5     100.0       14.2     11.7  
                                         
Purchased transportation
                                        
      Forward Air
   52.1     43.8       47.5     45.1       4.6     9.7  
      FASI
   4.4     25.6       3.9     23.6       0.5     12.8  
      Intercompany Eliminations
   (0.4 )   100.0       (0.3 )   100.0       (0.1 )   33.3  
            Total
   56.1     41.3       51.1     42.1       5.0     9.8  
                                         
Salaries, wages and employee benefits
                                        
      Forward Air
   26.4     22.2       24.7     23.4       1.7     6.9  
      FASI
   7.0     40.7       7.2     43.6       (0.2 )   (2.8 )
            Total
   33.4     24.6       31.9     26.3       1.5     4.7  
                                         
Operating leases
                                        
      Forward Air
   4.9     4.1       4.7     4.5       0.2     4.3  
      FASI
   1.7     9.9       1.8     10.9       (0.1 )   (5.6 )
            Total
   6.6     4.9       6.5     5.3       0.1     1.5  
                                         
Depreciation and amortization
                                        
      Forward Air
   4.4     3.7       4.2     4.0       0.2     4.8  
      FASI
   1.0     5.8       1.0     6.1       --     --  
            Total
   5.4     4.0       5.2     4.3       0.2     3.8  
                                         
Insurance and claims
                                        
      Forward Air
   1.8     1.5       1.2     1.1       0.6     50.0  
      FASI
   0.4     2.3       0.3     1.8       0.1     33.3  
            Total
   2.2     1.6       1.5     1.2       0.7     46.7  
                                         
Fuel expense
                                        
      Forward Air
   1.0     0.9       0.9     0.9       0.1     11.1  
      FASI
   1.4     8.1       1.1     6.7       0.3     27.3  
            Total
   2.4     1.8       2.0     1.6       0.4     20.0  
                                         
Other operating expenses
                                        
      Forward Air
   7.7     6.5       6.4     6.1       1.3     20.3  
      FASI
   1.6     9.3       1.4     8.5       0.2     14.3  
            Total
   9.3     6.8       7.8     6.4       1.5     19.2  
                                         
Income (loss) from operations
                                        
      Forward Air
   20.6     17.3       15.7     14.9       4.9     31.2  
      FASI
   (0.3 )   (1.7 )     (0.2 )   (1.2 )     (0.1 )   50.0  
            Total
 $ 20.3     15.0 %   $ 15.5     12.8 %   $ 4.8     31.0 %
 
 
7
 
 
Forward Air Corporation
  
Segment Information
  
(In millions)
  
(Unaudited)
  
   
 
Nine months ended
  
 
September 30,
    
Percent of
    
September 30,
    
Percent of
          
Percent
  
 
2011
    
Revenue
    
2010
    
Revenue
    
Change
    
Change
  
Operating revenue
                                  
      Forward Air
 $ 340.6     87.7 %   $ 301.8     86.1 %   $ 38.8     12.9 %
      FASI
   48.4     12.5       49.8     14.2       (1.4 )   (2.8 )
      Intercompany Eliminations
   (0.9 )   (0.2 )     (1.0 )   (0.3 )     0.1     (10.0 )
            Total
   388.1     100.0       350.6     100.0       37.5     10.7  
                                         
Purchased transportation
                                        
      Forward Air
   149.8     44.0       135.9     45.0       13.9     10.2  
      FASI
   11.6     24.0       11.4     22.9       0.2     1.8  
      Intercompany Eliminations
   (0.8 )   88.9       (0.9 )   90.0       0.1     (11.1 )
            Total
   160.6     41.4       146.4     41.8       14.2     9.7  
                                         
Salaries, wages and employee benefits
                                        
      Forward Air
   75.0     22.0       73.4     24.3       1.6     2.2  
      FASI
   20.3     41.9       22.3     44.8       (2.0 )   (9.0 )
            Total
   95.3     24.5       95.7     27.3       (0.4 )   (0.4 )
                                         
Operating leases
                                        
      Forward Air
   14.7     4.3       13.6     4.5       1.1     8.1  
      FASI
   5.4     11.1       5.8     11.7       (0.4 )   (6.9 )
            Total
   20.1     5.2       19.4     5.5       0.7     3.6  
                                         
Depreciation and amortization
                                        
      Forward Air
   12.6     3.7       12.3     4.1       0.3     2.4  
      FASI
   3.1     6.4       2.9     5.8       0.2     6.9  
            Total
   15.7     4.0       15.2     4.3       0.5     3.3  
                                         
Insurance and claims
                                        
      Forward Air
   4.8     1.4       4.7     1.6       0.1     2.1  
      FASI
   1.3     2.7       1.3     2.6       --     --  
            Total
   6.1     1.6       6.0     1.7       0.1     1.7  
                                         
Fuel expense
                                        
      Forward Air
   3.4     1.0       2.7     0.9       0.7     25.9  
      FASI
   4.0     8.3       3.3     6.6       0.7     21.2  
            Total
   7.4     1.9       6.0     1.7       1.4     23.3  
                                         
Other operating expenses
                                        
      Forward Air
   25.0     7.4       22.1     7.3       2.9     13.1  
      FASI
   4.5     9.3       4.8     9.6       (0.3 )   (6.3 )
      Intercompany Eliminations
   (0.1 )   11.1       (0.1 )   10.0       --     --  
            Total
   29.4     7.6       26.8     7.7       2.6     9.7  
                                         
Income (loss) from operations
                                        
      Forward Air
   55.3     16.2       37.1     12.3       18.2     49.1  
      FASI
   (1.8 )   (3.7 )     (2.0 )   (4.0 )     0.2     (10.0 )
            Total
 $ 53.5     13.8 %   $ 35.1     10.0 %   $ 18.4     52.4 %

 
8
 

Forward Air Corporation
Forward Air Inc. Operating Statistics
                   
 
Three months ended
    
 
September 30,
    
September 30,
    
Percent
    
 
2011
    
2010
    
Change
    
                   
Operating ratio
   82.7 %     85.1 %   (2.8 ) %
                       
Business days
   64.0       64.0     -    
Business weeks
   12.8       12.8     -    
                       
                       
Airport-to-airport:
                      
Tonnage
                      
    Total pounds ¹
   437,870       414,508     5.6    
    Average weekly pounds ¹
   34,209       32,383     5.6    
                       
Linehaul shipments
                      
    Total linehaul
   601,150       563,448     6.7    
    Average weekly
   46,965       44,019     6.7    
                       
Forward Air Complete shipments
   97,257       80,684     20.5    
As a percentage of linehaul shipments
   16.2 %     14.3 %   13.3    
                       
Average linehaul shipment size
   728       736     (1.1 )  
                       
Revenue per pound ²
                      
    Linehaul yield
 $ 16.95     $ 16.64     1.6    
    Fuel surcharge impact
   1.91       1.20     3.6    
    Forward Air Complete impact
   2.41       1.93     2.4    
Total airport-to-airport yield
 $ 21.27     $ 19.77     7.6    
                       
                       
Logistics:
                      
Miles
                      
    Owner operator ¹
   7,866       6,964     13.0    
    Third party ¹
   3,334       3,212     3.8    
Total Miles
   11,200       10,176     10.1    
                       
Revenue per mile
 $ 1.66     $ 1.66     --    
 
                      
Cost per mile
 $ 1.25     $ 1.27     (1.6 ) %
                       
                       
¹ - In thousands
² - In cents per pound; percentage change is expressed as a percent of total yield.

 
9
 
 
Forward Air Corporation
Forward Air Inc. Operating Statistics
                   
 
Nine months ended
    
 
September 30,
    
September 30,
    
Percent
    
 
2011
    
2010
    
Change
    
                   
Operating ratio
   83.8 %     87.7 %   (4.4 ) %
                       
Business days
   192.0       191.0     0.5    
Business weeks
   38.4       38.2     0.5    
                       
                       
Airport-to-airport:
                      
Tonnage
                      
    Total pounds ¹
   1,276,636       1,217,097     4.9    
    Average weekly pounds ¹
   33,246       31,861     4.3    
                       
Linehaul shipments
                      
    Total linehaul
   1,770,198       1,685,257     5.0    
    Average weekly
   46,099       44,117     4.5    
                       
Forward Air Complete shipments
   269,973       228,286     18.3    
As a percentage of linehaul shipments
   15.3 %     13.5 %   13.3    
                       
Average linehaul shipment size
   721       722     (0.1 )  
                       
Revenue per pound ²
                      
    Linehaul yield
 $ 16.80     $ 16.29     2.7    
    Fuel surcharge impact
   1.84       1.18     3.4    
    Forward Air Complete impact
   2.27       1.82     2.3    
Total airport-to-airport yield
 $ 20.91     $ 19.29     8.4    
                       
                       
Logistics:
                      
Miles
                      
    Owner operator ¹
   22,413       19,907     12.6    
    Third party ¹
   9,706       9,326     4.1    
Total Miles
   32,119       29,233     9.9    
                       
Revenue per mile
 $ 1.66     $ 1.65     0.6    
 
                      
Cost per mile
 $ 1.25     $ 1.26     (0.8 ) %
                       
                       
¹ - In thousands
² - In cents per pound; percentage change is expressed as a percent of total yield.

 
10
 

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