Student Transportation announces fourth quarter results


    -   Revenue, up 38.4 percent from the comparable period last year to
        US $63.4 million
    -   EBITDAR(*) improvement of 50.5 percent to US $14.6 million from
        $9.7 million same period last year
    -   Net income rose to US $2.7 million from $1.7 million in prior year
        comparable period
    -   Prior interim financial statements revised to reflect tax
        deductibility of noncash loss related to exchange offer that closed
        in September 2007

    TORONTO, Sept. 22 /CNW/ - Student Transportation of America Ltd. ("STA"
or the "Company") (TSX: STB, STB.UN) today reported financial results for the
fourth quarter of fiscal year 2008, ended June 30, 2008. A separate release
was issued for the year end results. All financial results are reported in
U.S. dollars and compared to the same three month period last year except as
otherwise noted.
    Fiscal 2008 fourth quarter revenue was $63.4 million, up from
$45.8 million for the prior year fourth quarter and fiscal 2008 EBITDAR(*) rose
to $14.6 million from $9.7 million for the prior year quarter. STA reported
net income for the fourth quarter of fiscal 2008 of $2.7 million or $0.07 per
common share compared to $1.7 million or $0.07 per common share for the prior
year fourth quarter.
    For the quarter the Company generated cash available for distributions(*)
of $10.4 million and paid out distributions of $6.6 million (C $7.3 million).
Net cash provided by operations was $11.4 million for the quarter. As stated
previously, due to the seasonality of the business, (i.e. schools are not in
session during the majority of STA's first quarter), the Company views
distributable cash on an annualized basis.
    Consistent with previous comments by management and prior fiscal years,
results for the fourth quarter included the make-up of school days deferred
due to adverse winter weather in the second and third quarters of the fiscal

    Subsequent Events

    On July 15, 2008, Student Transportation of Canada (STC), an operating
subsidiary of STA, established its first foothold in South-western Ontario
when it announced the acquisition of London-based school bus operator Elgie
Bus Lines Limited. Elgie is STC's ninth acquisition in Canada and STA's 33rd
overall, increasing total Canadian operations to more than 1,200 vehicles and
nearly C$50 million in annualized Canadian revenue.

    Reconciliation of Net Income and EBITDAR
    (in 000's of US$)

                                                         Year over Year - Q4
                                                          Three Months Ended
                                                          6/30/08    6/30/07
                                                        ---------- ----------
    Net income                                           $  2,654   $  1,688

    Add back:
      Provision for income taxes                            1,268      1,280
      Other non operating (income) expense, net              (384)        56
      Unrealized (gain) loss on derivative contracts         (797)    (4,338)
      Severance                                                 -        452
      Interest expense                                      2,925      3,819
      Amortization expense                                    602        897
      Depreciation and depletion expense                    7,736      5,614
      Operating lease expense                                 645        277
                                                        ---------- ----------
    EBITDAR                                              $ 14,649   $  9,745
                                                        ---------- ----------
                                                        ---------- ----------

    Reconciliation of Cash Flow Provided by Operations and Cash Available for
    (in 000's of US$)

                                                           Three      Three
                                                          Months     Months
                                                           Ended      Ended
                                                          6/30/08    6/30/07
                                                        ---------- ----------

    Cash flows provided by operating activities          $ 11,399   $  8,069

      Changes in non-cash working capital items            (1,719)    (2,687)
      Changes in other assets and liabilities                (362)        61
      Non-operating cash flows                               (480)         -
      Cash interest expense                                 2,783      3,591
                                                        ---------- ----------
    Subtotal                                               11,621      9,034

      Interest expense (other than noncash and IPS
       Subordinated Notes)                                 (1,270)    (1,051)
      Dividends on Class B-Series two common shares          (231)       (75)
      Net realized foreign currency gain                      711          -
      Cash taxes paid                                        (350)         -
      Maintenance capital expenditures, net                   (95)         -
                                                        ---------- ----------
    Cash Available for Distributions               US$   $ 10,386   $  7,908
                                             ---------- ---------- ----------
                                             ---------- ---------- ----------

    Total Distributions - US$
      Interest on IPS Subordinated Notes           US$   $  1,245   $  2,395
      Dividends on IPS common shares               US$   $  1,286   $  2,483
      Dividends on common shares                   US$   $  4,030   $    389
                                             ---------- ---------- ----------
    Total Distributions                            US$   $  6,561   $  5,267
                                             ---------- ---------- ----------
                                             ---------- ---------- ----------

    Total Distributions                           $Cdn   $  7,314   $  6,089
                                             ---------- ---------- ----------
                                             ---------- ---------- ----------

    STA's financial statements, notes to financial statements and
management's discussion and analysis are available at or at the
Company's website

    Fiscal 2008 Quarterly Financial Statements - Amended

    The Company's consolidated financial statements and management's
discussion and analysis for each of the quarterly year to date periods for
fiscal 2008 have been adjusted to reflect an additional non-cash future tax
benefit totalling $3.1 million associated with the non-cash loss resulting
from the retirement of 14% Subordinated Notes in connection with the Company's
first Exchange Offer that closed on September 4, 2007. The future tax benefit
was not recorded in the year to date amounts included in each of the
previously filed consolidated financial statements for each interim quarter of
fiscal 2008 as the non-cash loss was originally considered non-deductible for
tax purposes. Upon final investigation and review in connection with the
preparation of the year-end consolidated financials statements, it has been
determined that the non-cash loss is deductible for tax purposes and that the
non-cash future tax benefit of $3.1 million should be recorded. For each of
the interim quarters of fiscal 2008, this adjustment did not affect
distributable cash, cash flow from operations or net loss before income taxes,
but did increase recovery of income taxes, reduce net loss, decrease future
tax liabilities, and reduce accumulated deficit by this amount. The amended
interim financial statements, notes to financial statements and management's
discussion and analysis are available at or at the Company's

    Conference Call & Webcast

    Management will host a conference call and live audio webcast to discuss
STA's performance for the fourth quarter of fiscal year 2008 at 11 a.m. (ET)
on September 23, 2008. The call may be accessed at by dialling 1-888-205-4499
or 416-883-7132 and enter the passcode 37614 followed by the number sign. The
webcast will be subsequently archived at A taped rebroadcast
will be available until 12 a.m. September 30, 2008 and can be accessed by
dialling 1-877-245-4531 and enter passcode 672536 followed by the number sign.


    Founded in 1997, Student Transportation is the fourth-largest provider of
school bus transportation services in North America, conducting operations
through local operating subsidiaries. Student Transportation has become a
leading school bus transportation company by aggregating operations through
the consolidation of existing providers and conversion of in-house operations
and currently operates more than 5,400 school vehicles in North America. For
more information, please visit

    (*) Non-GAAP Measures

    EBITDAR is a non-GAAP financial measure, but management believes it is
useful in measuring STA's performance. Readers are cautioned that this measure
should not be construed as an alternative to net income or loss or other
comparable measures determined in accordance with GAAP as an indicator of the
Company's performance or as a measure of its liquidity and cash flow. The
Company's method of calculating non-GAAP measures may differ from the methods
used by other issuers and accordingly, the Company's non-GAAP measures may not
be comparable to similarly titled measures used by other issuers.
    Cash available for distributions is a non-GAAP measure, and is not
intended to be representative of cash flow or results of operations determined
in accordance with GAAP. Investors are cautioned that cash available for
distribution, as calculated by the Company, is unlikely to be comparable to
similar measures used by other issuers.

    Forward-Looking Statements

    This news release contains "forward-looking statements" within the
meaning of applicable securities laws, which reflects the expectations of
management regarding the Issuer's and Company's results of operations, expense
levels, seasonality, cash flows, performance, liquidity, borrowing
availability, financial ratios, ability to execute the Company's growth
strategy and cash distributions. Forward-looking statements generally can be
identified by the use of forward-looking terminology such as "may", "will",
"expect", "intend", "track", "targeted", "estimate", "anticipate", "believe",
"should", "could", "plans" or "continue" or similar expressions suggesting
future outcomes or events. These forward-looking statements reflect the
Company's current expectations regarding anticipated future events, results,
circumstances, performance or expectations that are not historical facts.
Forward-looking statements involve significant risks and uncertainties, and
should not be read as guarantees of future performance or results, and will
not necessarily be accurate indications of whether or not or the times at
which or by the performance or results will be achieved. A number of factors
could cause our actual results to differ materially from the results
discussed, expressed or implied in any forward-looking statement made by us or
on our behalf, including, but not limited to, the factors discussed under
"Risk Factors" in our Annual Information Form. These forward-looking
statements are made as of the date of this news release and, except as
required by applicable law, we undertake no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information,
future events or otherwise

For further information:

For further information: INVESTOR CONTACTS: Student Transportation of
America Ltd., Denis J. Gallagher, Chairman and CEO, (732) 280-4200; Patrick J.
Walker, Executive VP and CFO, (732) 280-4200; Keith P. Engelbert, Director of
Investor Relations, (732) 280-4200, (732) 280-4213 (FAX), Email:, Website:; MEDIA CONTACT: Lynette
Viviani, (973) 968-7929 office, (973) 534-1004 mobile,

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