Student Transportation reports fiscal 2007 fourth quarter and year end results

    TORONTO, Sept. 24 /CNW/ - Student Transportation of America Ltd. (TSX:
STB, STB.UN) ("STA") today reported financial results for the fiscal year and
fourth quarter ended June 30, 2007. All financial results are reported in U.S.
dollars except as otherwise noted.
    Revenue increased 26.4% to $168.1 million for fiscal 2007. Similarly,
revenue in the fourth quarter increased 21% to $45.8 million compared to
$37.9 million in the same period last year.

    EBITDAR(*) for the fiscal year grew 22.3% to $30.3 million compared to
$24.8 million in fiscal 2006. EBITDAR for the fourth quarter increased 38.5%
to $9.7 million from $7.1 million in the comparable period last year. STA
posted net income of $1.7 million in the fourth quarter of fiscal 2007
compared to a net loss of $0.9 million for the fourth quarter of fiscal 2006.
Net loss for fiscal year 2007 and fiscal year 2006 amounted to $7.1 million
and $3.9 million, respectively. The increase in net loss for fiscal 2007
resulted primarily from a $2.8 million non-cash decrease in unrealized gains
on derivative contracts. In addition, the net loss for fiscal 2007 reflects
$9.4 of interest paid to IPS note holders as part of their distributions and
non cash expense items such as minority interest, non cash stock compensation
expense, amortization of deferred financing costs, depreciation and
amortization expense.
    The Company generated cash available for distributions of C$27.3 million
(US$23.1 million) for the fiscal year ended June 30, 2007. Distributions paid
during the fiscal year totalled C$23.2 million (US$19.7 million). For the
fourth quarter of fiscal 2007, cash available for distributions was
C$9.2 million (US$7.9 million) compared to C$6.6 million (US$5.5 million) in
the same period last year. Distributions paid during the fourth quarter
totalled C$6.1 million compared to C$4.7 million last year. Cash flows from
operations for fiscal year 2007 and fiscal year 2006 totaled $10.1 million and
$12.8 million, respectively.
    "We are pleased with our results for the past year. We continue to
increase our base of operations and build our regions. We anticipate another
good year of growth in revenues and improved cash flows for fiscal 2008. Over
the last two and a half years since our IPO, we have just about doubled our
revenues and our cash available for distributions. We have increased our
number of shareholders, lowered our cost of capital and begun the process to
convert to a common share company with an attractive qualified dividend of
C$0.56 per share," said Denis J. Gallagher, Chairman and Chief Executive
Officer. "Our plans for fiscal 2008 are to continue our growth in Canada and
the U.S. witnessed recently by our new acquisition in Ontario and additional
contract awards in the U.S."
    STA's overall performance this past year enabled the Company to raise
capital to continue its growth program. During the fiscal year, the company
raised a total of C$20 million in its first ever common share (TSX: STB)
private placement offering and secured $35 million dollars in senior secured
notes at 5.9% fixed rate for five years.
    The Company's securities, known as IPS's, (Income Participating
Securities), consist of one common share and one subordinated note per unit.
The Company will continue to make the transition to a common share company
through future offerings of common shares, and is reviewing another exchange
offering of common shares for subordinated notes as well as potentially
exercising the call feature on its subordinated notes in December 2009.

    Subsequent Events

    On September 5th, Student Transportation of Canada ("STC"), an operating
subsidiary of STA, announced that it had acquired the Elliott Coach Lines
("Elliott") group of companies, a local school bus operator based in Guelph,
Ontario. Elliott added more than 230 vehicles, C$12 million in annualized
revenue and three locations to STC's Ontario operations. The acquisition will
increase the company's Canadian cash flows.
    The Company also announced that C$45.8 million or 51% of aggregate
principal amount of subordinated notes of STA ULC were tendered to its
previously announced exchange offer which expired on September 4, 2007. As a
result of the exchange, the Company will have a majority of common shares
outstanding versus IPS units and will have reduced its total debt by
approximately C$45.8 million.

    Reconciliation of Net Income and EBITDAR

    (Amounts in 000's)                Three      Three     Fiscal     Fiscal
                                     Months     Months       Year       Year
                                      Ended      Ended      Ended      Ended
                                    6/30/07    6/30/06    6/30/07    6/30/06
                                  ---------- ---------- ---------- ----------

    Net income (loss)              $  1,688   $   (857)  $ (7,114)  $ (3,895)

    Add back:
      Recovery of future taxes        1,280     (1,083)    (4,391)    (2,695)
      Minority interest                  62        130        170        226
      Other (income) expense, net        (6)        11       (642)        52
      Unrealized loss (gain) on
       derivative contracts          (4,338)    (2,088)    (1,481)    (4,262)
      Non-cash stock compensation         -        919      1,862        919
      Severance                         452          -        452          -
      Interest expense                3,819      3,548     15,834     13,262
      Amortization expense              897      1,633      5,889      6,198
      Depreciation expense            5,614      4,837     18,596     14,964
      Operating lease expense           277          -      1,124          -
                                  ---------- ---------- ---------- ----------
    EBITDAR                        $  9,745   $  7,050   $ 30,299   $ 24,769
                                  ---------- ---------- ---------- ----------
                                  ---------- ---------- ---------- ----------

    Reconciliation of cash flow
     provided by operations
     to Cash Avavilable for
     Distributions                    Three      Three     Fiscal     Fiscal
                                     Months     Months       Year       Year
    (Amounts in 000's)                Ended      Ended      Ended      Ended
                                    6/30/07    6/30/06    6/30/07    6/30/06
                                  ---------- ---------- ---------- ----------
    Cash flows provided by
     operating activities          $  8,069   $  7,003   $ 10,115   $ 12,803

      Changes in non-cash
       working capital items         (2,687)    (3,302)     5,293        247
      Changes in other assets
       and liabilities                   61        120       (410)       (98)
      Non-operating cash
       flows                            (17)         -       (480)         -
      Cash interest expense           3,591      3,229     14,206     11,817
                                  ---------- ---------- ---------- ----------
    Subtotal                          9,017      7,050     28,724     24,769

      Minority interest in
       cash flow of
       subsidiaries                     (75)      (215)      (599)      (788)
      Interest expense (other
       than noncash and IPS
       Subordinated Notes)           (1,051)    (1,264)    (4,468)    (4,940)
      Non-operating cash
       flows                             17          -        480          -
      Cash taxes paid                     -          -        (89)      (179)
      Maintenance capital
       expenditures, net                  -        (88)      (978)    (5,084)
                                  ---------- ---------- ---------- ----------
    Cash Available for
     Distributions            US$  $  7,908   $  5,483   $ 23,070   $ 13,778
                             ---- ---------- ---------- ---------- ----------
                             ---- ---------- ---------- ---------- ----------
    Cash Available for
     Distributions           $Cdn  $  9,142   $  6,570   $ 27,252   $ 16,716
                             ---- ---------- ---------- ---------- ----------
                             ---- ---------- ---------- ---------- ----------

    Total Distributions
      Interest on IPS
       Subordinated Notes    $Cdn  $  2,789   $  2,356   $ 11,168   $  8,347
      Dividends on IPS
       common shares         $Cdn     2,882      2,381     11,538      8,348
      Dividends on common
       shares                           418          -        558          -
                                  ---------- ---------- ---------- ----------
    Total Distributions      $Cdn  $  6,089   $  4,737   $ 23,264   $ 16,695
                             ---- ---------- ---------- ---------- ----------
                             ---- ---------- ---------- ---------- ----------

    Student Transportation's annual financial statements, notes to financial
statements and management's discussion and analysis are available at or at the Company's investor website at

    Conference Call & Webcast

    Management will host a conference call and live audio webcast to discuss
Student Transportation's performance for the fiscal year and fourth quarter
ended June 30, 2007 at 11 a.m. ET on September 25, 2007. The call can be
accessed by dialing 416-849-9305 or 1-866-838-4337. The audio webcast will be
archived at A taped rebroadcast will be available until 12
a.m. ET on October 2, 2007. To access the rebroadcast, please dial
416-915-1035 or 1-866-245-6755 and enter the passcode 590685 followed by the
number sign.

    Annual Meeting of Investors

    STA will hold its Annual General Meeting on Wednesday, November 14, 2007
at 2 p.m. ET at the TSX Gallery located at The Exchange Tower at 130 King
Street West in Toronto. The meeting will also be webcast live at STA's web
site at


    Student Transportation is the fifth-largest provider of school bus
transportation services in North America, conducting operations through local
operating subsidiaries. Student Transportation has become a leading school
transportation and management company by aggregating operations through the
consolidation of existing providers and conversion of in-house operations and
currently operates more than 4,500 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. EBITDAR
represents earnings before interest, taxes, depreciation, amortizations,
operating lease expense, severance expense and non cash items such as minority
interest, unrealized gain / loss on foreign currency exchange contracts, and
non cash stock compensation expense, and other income / loss.
    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 STA's results of operations, expense levels, cost of
capital, financial leverage, seasonality, cash flows, performance, liquidity,
borrowing availability, financial ratios, ability to execute the STA'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", "plans" or "continue" or similar expressions suggesting future
outcomes or events. These forward looking statements reflect STA's current
expectations regarding anticipated future events, results, circumstances,
performance or expectations, including the acquisition of notes under the
Exchange Offer, 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 acquisition of less than a significant
number of notes under the Exchange Offer and 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: Denis J. Gallagher, Chairman and Chief
Executive Officer, Phone: (732) 280-4200, Fax: (732) 280-4213; Patrick J.
Walker, Chief Financial Officer, Phone (732) 280-4200, Fax: (732) 280-4213;
Keith P. Engelbert, Director of Investor Relations, Phone: (732) 280-4200,
Fax: (732) 280-4213,

Organization Profile


More on this organization


More on this organization

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890