Exhibit 99.1 Forward Air Corporation Reports Record Third Quarter 2005 Results; 17.9% Revenue Growth; 22.0% Operating Margin; 40.7% Fully Diluted EPS Growth GREENEVILLE, Tenn.--(BUSINESS WIRE)--Oct. 25, 2005--Forward Air Corporation (NASDAQ:FWRD) today reported record results for the third quarter ended September 30, 2005. Operating revenue for the quarter ended September 30, 2005 increased 17.9% to a record $84.8 million from $71.9 million for the same quarter in 2004. Income from operations was $18.7 million, compared with $13.8 million in the prior-year quarter, an increase of 35.5%. As a percent of operating revenue, income from operations improved to 22.0% from 19.2% in 2004. Net income during the period increased 34.4% to $12.1 million from $9.0 million in the prior-year quarter. Diluted income per share from operations for the third quarter of 2005 was $0.38 compared with $0.27 in the prior-year quarter, an increase of 40.7%. Operating revenue for the nine months ended September 30, 2005 increased 13.3% to $231.9 million from $204.6 million for the same period in 2004. Income from operations was $48.8 million, compared with $37.9 million in the prior-year period, an increase of 28.8%. As a percent of operating revenue, income from operations improved to 21.1% for the first nine months of 2005 from 18.5% in 2004. Pre-tax income for the period increased to $52.1 million from $38.6 million in the previous period. Pre-tax income during the first nine months of 2005 includes a $1.4 million ($0.9 million after-tax or $0.03 per diluted share) gain from a lawsuit settled during the second quarter. Net income during the period increased 34.6% to $32.7 million from $24.3 million in the prior-year period. Diluted income per share from operations for the first nine months of 2005 was $1.00 compared with $0.74 in the prior-year period, an increase of 35.1%. Commenting on the Company's third quarter 2005 results, Bruce A. Campbell, President and CEO, said, "Forward Air is pleased to report another record quarter for our company, an uninterrupted trend that began ten quarters ago. We continue to experience strong growth in the airport-to-airport portion of our business with revenue increasing over 20% in the third quarter. Our results, coupled with our recent listing on Forbes magazine's annual listing of the "200 Best Small Companies" in America for the seventh year in a row, demonstrate the exceptional performance and customer-focus of our entire team." Commenting further on the third quarter and nine-month period 2005 results, Andrew C. Clarke, Senior Vice President and CFO, said, "During the third quarter, the Company completed its previously authorized 3.0 million share buyback program by repurchasing approximately 660,000 shares. Since inception, the Company spent $72.6 million on the stock buyback program." Review of Financial Results Forward Air will hold a quarterly conference call to discuss third quarter 2005 results on Wednesday, October 26, 2005, at 9:00 a.m. EDT. 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 Forward Air is a high-service-level contractor to the air cargo industry providing time-definite ground transportation services through a network of 81 terminals located on or near major airports in the United States and Canada. The Company 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 CORPORATION Condensed Statements of Income (Unaudited) (In thousands, except per share data) Three months ended Nine months ended -------------------- ----------------------- 9/30/05 9/30/04 (a) 9/30/05 9/30/04 (a) -------------------- ----------------------- Operating revenue $84,841 $71,905 $231,861 $204,618 Operating expenses: Purchased transportation 35,512 30,568 94,994 85,487 Salaries, wages and employee benefits 17,486 15,609 49,305 45,392 Operating leases 3,448 3,279 10,159 9,731 Depreciation and amortization 2,815 1,692 6,637 5,088 Insurance and claims 841 1,297 3,862 4,546 Other operating expenses 6,070 5,653 18,063 16,428 -------------------- ----------------------- Total operating expenses 66,172 58,098 183,020 166,672 -------------------- ----------------------- Income from operations 18,669 13,807 48,841 37,946 Other income, net 563 291 3,271 661 -------------------- ----------------------- Pre-tax income 19,232 14,098 52,112 38,607 Income taxes 7,167 5,086 19,400 14,280 -------------------- ----------------------- Net income $12,065 $ 9,012 $ 32,712 $24,327 ==================== ======================= Income per share: Basic $ 0.38 $ 0.28 $ 1.02 $ 0.75 Diluted $ 0.38 $ 0.27 $ 1.00 $ 0.74 Weighted average shares outstanding: Basic 31,353 32,346 32,031 32,285 Diluted 32,048 32,988 32,621 32,888 FORWARD AIR CORPORATION Condensed Consolidated Balance Sheets (In thousands) 9/30/05 12/31/04 ----------- ----------- (Unaudited) Audited (b) Assets: Cash and short-term investments $ 78,331 $ 111,678 Other current assets 55,163 47,744 Property and equipment, net 37,331 37,286 Other assets 28,833 17,845 ------------ ---------- Total assets $ 199,658 $ 214,553 ============ ========== Liabilities and Shareholders' Equity: Current liabilities 27,715 25,657 Long-term obligations 7,072 7,893 Shareholders' equity 164,871 181,003 ------------ ---------- Total liabilities and shareholders' equity $ 199,658 $ 214,553 ============ ========== (a) Income per share has been restated to give effect to a three-for-two stock split declared in February 2005. (b) Taken from audited financial statements, which are not presented in their entirety. 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. CONTACT: Forward Air Corporation, Greeneville Andrew C. Clarke, 423-636-7000 aclarke@forwardair.com