News Column

Commercial Barge Line Company Announces Results for Quarter and Year Ended December 31, 2012

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JEFFERSONVILLE, IN -- (Marketwire) -- 02/25/13 --


Highlights

Adjusted EBITDAR of $232.1 million for the year -- a 33% increase over prior yearOperating income of $61.1 million for the year -- an increase of $57.4 million compared to prior yearCash generated from operating activities of $65.8 million during the quarterNet Funded Debt to Adjusted EBITDAR ratio of 2.0 times at year-end Strong liquidity with $176.6 million in available borrowing capacity as of December 31, 2012Company announces offering of $650 million senior secured term loan. Proceeds to redeem ACL I Notes and Senior Notes of the Company and pay distribution to shareholders

Commercial Barge Line Company (the "Company") today announced results for the quarter and year ended December 31, 2012. For the year, the Company reported total revenues of $811.6 million and Adjusted EBITDAR of $232.1 million. Compared to 2011 results, revenues declined $41.4 million, or 4.9%, while Adjusted EBITDAR improved by $57.8 million, or 33.2%. For the quarter, total revenues were $207.9 million compared to $244.5 million in 2011 and Adjusted EBITDAR was $62.8 million compared to $60.3 million in 2011.

Commenting on the results, Mark Knoy, President and Chief Executive Officer, stated, "We are quite pleased with the continued strong operating performance we experienced, despite the challenges we faced due to the drought-related operating conditions as well as its impact on the US grain harvest. While we experienced a decline in transportation segment revenue of over $26 million in the quarter compared to last year, driven by a 27% reduction in grain ton-mile volume, our EBITDAR margin was essentially flat with what we achieved in the prior year and our Adjusted EBITDAR, which adjusts for non-comparable items including our estimate of drought-impact, exceeded last year by $2.5 million, resulting in a 5.6 percentage point increase in our Adjusted EBITDAR margin. For the year, this trend was even more marked, with an improvement in Adjusted EBITDAR of $57.8 million on a transportation revenue base that was nearly $34 million lower, for an Adjusted EBITDAR margin improvement of over 8%. Our ability to continue to deliver improved operating performance and earnings is the direct result of our execution of the operating priorities that we have been driving for the past two years -- maintaining a focused distribution footprint within our core operating network, reducing non-value miles, investing wisely to improve the reliability of our equipment and providing a safe environment for our teammates to deliver on our productivity initiatives."

As previously announced, the Company entered into new contractual agreements with MEG Energy (US) Inc. and SeaRiver Maritime Inc. (a marine affiliate of Exxon Mobil Corporation) ("Exxon") during the fourth quarter, further extending the Company's scope within the fast growing petroleum distribution market. Mr. Knoy stated, "We have identified the petroleum market as a significant growth opportunity for the Company, and have aggressively pursued new opportunities in this space. We are excited about working with MEG Energy and Exxon on these new contracts. Bolstered by these new relationships and the anticipated additions of tank barges to our fleet during 2013, we will move more than 60 million barrels of crude oil, refined petroleum products, chemicals and other liquid products on an annualized basis, greatly increasing our market position in this fast-growing sector, and thereby strengthening our business mix and improving our quality of earnings. As we continue to expand in this space, we expect that our liquids business will contribute approximately 60% of our consolidated EBITDAR in the future."

During the fourth quarter, the Company continued to experience adverse operating conditions associated with the severe drought which began during the late second quarter of 2012. Commenting on operating conditions during the quarter, Mr. Knoy stated, "Operating conditions on the inland waterways gradually improved as we moved through the fourth quarter. We saw some much needed precipitation through the Ohio River Valley and Lower Mississippi River area at key points during that time. These improved weather patterns resulted in river conditions in these regions that allowed us to begin operating at near-normal barge drafts and tow sizes as we entered 2013. Conditions on the Mississippi River between St. Louis and Cairo, Illinois continued to disrupt operations in that area as well as at our St. Louis coal transfer terminal; however, we have seen these conditions improve as well with some late-January precipitation and today, operating conditions are back to normal. As a result, we believe that we will no longer experience drought-related operating constraints by the end of the first quarter of 2013 and the negative financial impact of these challenges will then be behind us."

Senior Secured Term Loan Offering Announced
The Company today announced that it has launched a financing whereby it intends to raise $650 million through a new senior secured term loan (the "Term Loan Financing") with Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman Sachs & Co., UBS Investment Bank and Wells Fargo Securities as Joint Lead Arrangers and Joint-Bookrunners, together with PNC Capital Markets LLC, Royal Bank of Scotland and SunTrust Robinson Humphrey, Inc. as Co-Managers. The Company also announced that, concurrent with the Term Loan Financing, it expects to increase the overall commitment of its asset-based revolving line of credit from $475 million to $550 million (together with the Term Loan Financing, the "Financing"). The net proceeds from the Financing, if consummated, are expected to be used to discharge and then subsequently redeem the outstanding principal amount of: (i) ACL I Corporation's 10.625%/11.375% Senior PIK Toggle Notes due 2016 at a redemption price of 105% of the principal amount and (ii) the Company's 12 1/2% Senior Secured Notes due 2017 at a redemption price of 106.25% of the principal amount, in each case, plus accrued and unpaid interest to the date of redemption. The proceeds for the redemption will be deposited with the trustee of each series of notes upon the closing of the Financing, at which time the respective obligations under the related indentures will be discharged. It is expected that the redemption payments will be received by the holders of ACL I Corporation's notes in mid-April and by the holders of the Company's notes in mid-July. In addition, proceeds of the Financing will fund a $207 million dividend to the shareholders of the Company's ultimate Parent, Finn Holding Corporation.

2013 Outlook
Commenting on the Company's outlook, Mr. Knoy said, "We continue to see opportunities in the energy sector, as North American oil production continues to rise. Tank barge capacity in the industry continues to be in tight supply, so we are confident that we will be able to quickly realize the earnings benefit of the new tank barges that will be completed by Jeffboat during the first half of 2013. We estimate that the strength of this market segment coupled with our significant investment in equipment to serve it will provide the Company with approximately $20 million in improved annual EBITDAR performance when fully deployed. North American production of natural gas will continue to support a pricing environment that will support growing chemical production in the US, further increasing the demand for tank barge capacity. While low natural gas prices will pressure domestic coal volumes as domestic utilities increase their use of gas powered generation, we believe that our exposure to this is mitigated as our sole domestic coal contract is dependent upon Powder River Basin coal, which is the most cost competitive coal versus natural gas. We do, however, remain cautious on our opportunities in the export coal market in the near term due to negative volume pressure resulting from high coal inventories in Europe and continued downward pricing pressure on open barge capacity in the US. A significant majority of our dry bulk cargo business is contracted, and as such, will be relatively stable, subject to some nearby variation as the US economy continues to gain its footing."

"Although river conditions are now back to pre-drought conditions, we will continue to suffer market related effects of the 2012 drought through the first half of 2013, as grain stockpiles available for export have fallen off significantly from historic levels. This reduction in available product has also driven domestic prices to levels that are not competitive in the international export markets, thereby putting further downward pressure on export volumes. We do expect that domestic plantings will again be at historically high levels in 2013, and that we may see improved dynamics in this sector when the first harvested acres reach market in the early third quarter."

Mr. Knoy went on to say, "We entered 2013 positioned very well to respond to improved operating and market conditions as a result of the investments made in our fleet assets over the past 18 months. We have eliminated nearly 450 of our poorest performing barges from our fleet and have invested over $90 million in our fleet of tow boats, greatly improving their reliability, towing capacity and fuel efficiency. We countered the impact of these barge retirements through the addition of 95 new covered hopper barges during the year. In addition, we invested $69 million in new tank barges to take advantage of the strong market fundamentals in that sector and similarly expect to invest an additional $38 million in 2013 to support contracted business in this space. With these actions, we have improved the age of our covered hopper fleet to approximately 12 years and the age of our 30,000 barrel tank barge fleet will be approximately the same level as we complete our current construction program in 2013. Despite the magnitude of these investments, we entered 2013 with significant liquidity, with $177 million of total availability on our line of credit." The Company estimates that capital spending for 2013 will be in the range of $40 million to $45 million, excluding the $38 million that will be spent to complete the new barge construction referred to above.

Adjusted EBITDAR
For the year ended December 31, 2012, Adjusted EBITDAR was $232.1 million, a 33.2% increase over $174.3 million for the prior year. The improvement in Adjusted EBITDAR over prior year was driven by a $26.4 million reduction in repairs and claims costs, $16.0 million in improved boat productivity resulting from fewer boats in service, $5.3 million in reduced compensation and selling, general and administrative expenses, $1.2 million improvement in fuel efficiency and price and $2.0 million higher manufacturing margin resulting from higher sales and improved efficiency. The year's gains were partially offset by $5.5 million in pricing softness, where pricing strength in the Company's liquids business was more than offset by weakness in the grain and export coal markets. Gains on the sale of excess assets contributed $17.3 million to the current year improvement.

Adjusted EBITDAR for the three months ended December 31, 2012 was $62.8 million compared to $60.3 million in the prior year quarter. The change in Adjusted EBITDAR included $9.6 million lower repairs and claims, $3.8 million in reduced compensation costs and selling, general and administrative expenses, $1.1 million improvement in boat productivity, $0.9 million improvement in fuel efficiency and price, and $1.2 million as the pricing of liquids and coal more than offset negative grain pricing during the quarter. These positive factors were partially offset by $5.6 million in margin impact of reduced volumes and lower gains on the sale of excess assets of $4.4 million.

Adjusted EBITDAR includes an add-back totaling $43.9 million for the year and $17.2 million for the fourth quarter related to the estimated impact of the adverse operating conditions experienced by the Company as a result of this year's extraordinary drought. These adjustments were estimated by comparing the Company's actual operating performance metrics to those that were achieved during the months leading up to the drought period. The impact related to the drought is attributable to the following factors:

•Reduction in Tons per Load: Extremely low Mississippi River levels limited the amount of cargo that could be carried due to reduced drafts. This decline in tons transported resulted in a reduction in Adjusted EBITDAR of $10.1 million for the quarter and $20.9 million for the year.
•Reduction in Barges per Tow: The number of barges per tow was reduced at various times during the drought to facilitate safe operations. As a result, the Company required more tow boats in service to deliver the equivalent number of barges based upon number of barges per tow. The cost of this excess towing capacity during the fourth quarter was $4.3 million and $10.3 million for the year.
•Reduction in Asset Turns: River conditions led to more traffic disruptions on the Mississippi River south of St. Louis, resulting in a reduced turn of fleet assets. As a result, the Company was required to use more tow boat power to deliver booked freight during the quarter and the slower turn also impacted the number of revenue earning days on the barge fleet. The impact of these incremental costs and lost margin totaled $2.8 million during the quarter and $12.7 million year-to-date.



Revenues
Revenues for the year ended December 31, 2012 decreased 4.9% over prior year revenues to $811.6 million. Transportation segment revenues and ton-mile volumes were negatively impacted by the persistent, severe drought conditions experienced over the second half of the year, resulting in a decrease in revenues of 4.7% to $687.2 million and a decrease in ton-mile volumes of 8.6% to 31.8 billion ton-miles when compared to the prior year. We estimate the drought impact on load drafts, tow size, and equipment turns reduced our ton-mile volume by approximately 1.7 billion ton-miles and our revenues by $43.9 million. On a fuel-neutral basis, transportation revenues were down 6.5% for the year driven by the drought-related decline in ton-miles in the second half of the year.

Revenues for the quarter ended December 31, 2012 decreased 15.0% to $207.9 million. Drought-impacted transportation segment revenues decreased by 13.1% to $174.1 million while ton-mile volumes decreased by 20.0% to 7.4 billion. On a fuel-neutral basis, transportation revenues were down 14.0% for the quarter driven by the drought-related decline in ton-miles. Additionally, grain export shipments were significantly lower due to a smaller harvest and drought operating restrictions. Shipments of steel, salt and other bulk cargoes were also impacted by the drought operating conditions.

Manufacturing segment revenues decreased $7.5 million, or 5.7% for the year ended December 31, 2012 to $124.4 million, with 220 total barges produced for external customers in 2012 compared to 239 in the prior year. The manufacturing segment produced 80 total barges for the transportation segment, or 13 more barges in 2012 than in 2011. Current year internal production included 45 covered dry hopper barges, 21 liquid tank barges and 14 oversized tank barges. In the prior year only 2 oversized tank barges and 65 covered dry hopper barges were produced for the transportation segment. Manufacturing segment revenue decreased $10.5 million, or 23.7%, in the quarter, reflecting the delivery of 58 barges to third-parties compared to 77 in the prior year period. The manufacturing segment's external revenue backlog at the end of 2012 was $52.4 million, representing 2013 production backlog compared to a backlog of $101.2 million as of December 31, 2011. More recently, the external revenue backlog has increased to approximately $140 million as the remainder of 2013 production capacity, beyond the completion of the oversize tank barges currently in production for the transportation segment, has been committed for sale to third parties. The manufacturing segment's backlog fluctuates based on the Company's decisions regarding the balance of internal and external production slots.

Operating Results
As a result of the magnitude of non-comparable items, operating results of the Company are discussed herein based on Adjusted EBITDAR, which is a non-GAAP financial measure that the Company believes provides investors with a useful tool for analyzing its operating results as it eliminates the impact of certain non-comparable items. The Company has included a reconciliation of its financial results to Adjusted EBITDAR elsewhere in this release.

For the year ended December 31, 2012, the Company generated operating income of $61.1 million compared to operating income of $3.7 million for the same period in the prior year. This increase in operating income of $57.4 million between periods was driven primarily by lower repairs and claims; lower consulting, restructuring and acquisition expenses; an insurance gain related to the 2011 flooding; lower depreciation and amortization and higher gains on asset disposals. These positive items more than offset the negative margin impact of drought related operating conditions and lower volumes.

For the quarter ended December 31, 2012, operating income was $20.7 million as compared to $22.9 million for the same period of the prior year.

Liquidity and Debt Position
As of December 31, 2012, our outstanding debt totaled $435.7 million, including the unamortized purchase accounting debt premium of $23.6 million. The Company was in compliance with all debt covenants on December 31, 2012 and had $176.6 million in remaining total availability under its credit facility. The credit facility has no maintenance financial covenants unless borrowing availability is generally less than $48.8 million. As of December 31, 2012, the present value of lease payments associated with revenue generating equipment was $42.8 million. Including the present value of these lease payments and excluding the unamortized premium on the 2017 Notes, the Company's total funded net debt was $454.9 million, or 2.0 times Adjusted EBITDAR as of December 31, 2012 compared to 2.3 times as of December 31, 2011.

Updated Fleet Appraisal
The Company received an updated appraisal of its fleet in February of 2013 stating that fair market value of its towboats is $447.6 million and of its barges is $852.4 million for a total fleet value of over $1.3 billion.

About the Company
Commercial Barge Line Company, headquartered in Jeffersonville, Indiana, is an integrated marine transportation and service company operating in the United States Jones Act trades. For more information about the Company, visit the Company's website at www.aclines.com.

Forward-Looking Statements
This release includes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's present expectations and beliefs about future events. As with any projection or forecast, these statements are inherently susceptible to risks, uncertainty and changes in circumstance. Important factors could cause actual results to differ materially from those expressed or implied by the forward-looking statements and should be considered in evaluating the outlook of Commercial Barge Line Company. Risks and uncertainties are detailed from time to time in Commercial Barge Line Company's filings with the SEC, including our report on Form 10-K for the year ended December 31, 2011 and our most recent Form 10-Q. Commercial Barge Line Company is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of changes, new information, subsequent events or otherwise.


COMMERCIAL BARGE LINE COMPANY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands) (Unaudited) Quarter Ended December 31, ---------------------------- 2012 2011 ------------- -------------Revenues Transportation and Services $ 174,121 $ 200,302 Manufacturing 33,743 44,202 ------------- ------------- Revenues 207,864 244,504 ------------- -------------Cost of Sales Transportation and Services 148,022 166,964 Manufacturing 30,096 41,494 ------------- ------------- Cost of Sales 178,118 208,458 ------------- -------------Gross Profit 29,746 36,046Selling, General and Administrative Expenses 9,040 13,129 ------------- -------------Operating Income 20,706 22,917 ------------- -------------Other Expense (Income) Interest Expense 8,093 7,318 Debt Retirement Expenses - - Other, Net (380) (436) ------------- ------------- Other Expenses 7,713 6,882 ------------- -------------Income from Continuing Operations before Income Taxes 12,993 16,035Income Taxes 3,327 6,174 ------------- -------------Income from Continuing Operations 9,666 9,861Discontinued Operations, Net of Tax - 367 ------------- -------------Net Income $ 9,666 $ 10,228 ============= =============








COMMERCIAL BARGE LINE COMPANY CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands) Year Ended December 31, ---------------------------- 2012 2011 ------------- ------------- (Unaudited)Revenues Transportation and Services $ 687,178 $ 721,095 Manufacturing 124,379 131,842 ------------- ------------- Revenues 811,557 852,937 ------------- -------------Cost of Sales Transportation and Services 595,411 665,266 Manufacturing 111,343 127,871 ------------- ------------- Cost of Sales 706,754 793,137 ------------- -------------Gross Profit 104,803 59,800Selling, General and Administrative Expenses 43,663 56,095 ------------- -------------Operating Income 61,140 3,705 ------------- -------------Other Expense (Income) Interest Expense 31,278 29,963 Debt Retirement Expenses - - Other, Net (864) (968) ------------- ------------- Other Expenses 30,414 28,995 ------------- -------------Income (Loss) from Continuing Operations before Income Taxes 30,726 (25,290)Income Tax (Benefit) Expense 9,986 (10,610) ------------- -------------Income (Loss) from Continuing Operations 20,740 (14,680)Discontinued Operations, Net of Tax 26 489 ------------- -------------Net Income (Loss) $ 20,766 $ (14,191) ============= ============= COMMERCIAL BARGE LINE COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) December 31, December 31, 2012 2011 ------------- ------------- (Unaudited) ASSETSCurrent Assets Cash and Cash Equivalents $ 2,956 $ 938 Accounts Receivable, Net 76,859 87,368 Inventory 50,930 62,483 Deferred Tax Asset 4,407 6,390 Assets Held for Sale 1,311 1,612 Prepaid and Other Current Assets 18,180 19,308 ------------- ------------- Total Current Assets 154,643 178,099Properties, Net 1,035,367 935,576Investment in Equity Investees 4,340 6,470Accounts Receivable, Related Party, Net 12,140 12,021Goodwill 17,692 17,692Other Assets 38,384 45,521 ------------- ------------- Total Assets $ 1,262,566 $ 1,195,379 ============= ============= LIABILITIESCurrent Liabilities Accounts Payable $ 39,427 $ 48,653 Accrued Payroll and Fringe Benefits 16,457 20,035 Deferred Revenue 11,906 15,251 Accrued Claims and Insurance Premiums 12,396 13,823 Accrued Interest 13,540 11,708 Customer Deposits - 1,165 Other Liabilities 50,748 29,104 ------------- ------------- Total Current Liabilities 144,474 139,739Long Term Debt 435,718 384,225Pension and Post Retirement Liabilities 77,761 67,531Deferred Tax Liability 182,014 178,602Other Long Term Liabilities 32,216 46,335 ------------- ------------- Total Liabilities 872,183 816,432 ------------- ------------- SHAREHOLDER'S EQUITYOther Capital 423,977 424,932Retained Deficit (60) (20,826)Accumulated Other Comprehensive Loss (33,534) (25,159) ------------- ------------- Total Stockholder's Equity 390,383 378,947 ------------- ------------- Total Liabilities and Stockholder's Equity $ 1,262,566 $ 1,195,379 ============= =============. COMMERCIAL BARGE LINE COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) CBL CBL Successor Predecessor ------------------------------------- ----------- December 22 January 1 Year Ended Year Ended to to December December December December 31, 31, 31, 21, 2012 2011 2010 2010 ----------- ----------- ----------- ----------- (Unaudited)OPERATING ACTIVITIES Net Income (Loss) $ 20,766 $ (14,191) $ (6,635) $ 3,750 Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities: Depreciation and Amortization 101,351 109,018 2,860 45,253 Debt Retirement Costs - - - 8,701 Debt Issuance Cost Amortization (2,365) (2,624) (76) 5,162 Deferred Taxes (51) (14,408) (1,600) 27,644 Gain on Property Dispositions (9,040) (2,048) - (9,019) Contribution to Pension Plan (7,330) (8,831) - - Share-Based Compensation 131 2,319 41 7,423 Gain on Insurance Claim (11,442) - - - Other Operating Activities (9,196) (4,973) 59 (585) Changes in Operating Assets and Liabilities 39,785 (1,045) 13,383 (32,957) ----------- ----------- ----------- ----------- Net Cash Provided by Operating Activities 122,609 63,217 8,032 55,372 ----------- ----------- ----------- -----------INVESTING ACTIVITIES Property Additions (242,968) (70,414) - (57,798) Impact of Barge Scrapping Operations 34,565 6,556 - 7,753 Proceeds from Property Dispositions 18,734 3,860 - 7,337 Proceeds from Settlement Insurance Claim 14,450 - - - Proceeds from Sale of Elliott Bay - 1,629 - - Other Investing Activities (836) (7,397) (1,735) 3,513 ----------- ----------- ----------- ----------- Net Cash Used in Investing Activities (176,055) (65,766) (1,735) (39,195) ----------- ----------- ----------- -----------FINANCING ACTIVITIES Revolving Credit Facility Borrowings 256,551 245,649 500 169,204 Revolving Credit Facility Repayments (199,501) (240,880) (19,394) (154,518) Bank Overdrafts on Operating Accounts 2,022 2,963 (9,090) 6,356 Debt Issuance/Refinancing Costs (360) (323) - (15,402) Short Term Debt Repayments (2,293) - - - Dividends Paid (978) (7,842) - - Excess Tax Benefit of Share-based Compensation 23 213 2,926 (15) Other Financing Activities - - - (532) ----------- ----------- ----------- ----------- Net Cash Provided by (Used in) Financing Activities 55,464 (220) (25,058) 5,093 ----------- ----------- ----------- -----------Net Increase (Decrease) in Cash and Cash Equivalents 2,018 (2,769) (18,761) 21,270Cash and Cash Equivalents at Beginning of Period 938 3,707 22,468 1,198 ----------- ----------- ----------- ----------- Cash and Cash Equivalents at End of Period $ 2,956 $ 938 $ 3,707 $ 22,468 =========== =========== =========== ===========. COMMERCIAL BARGE LINE COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS SUPPLEMENTAL INFORMATION (In thousands) CBL CBL Successor Predecessor ------------------------------------- ----------- December 22 January 1 Year Ended Year Ended to to December December December December 31, 31, 31, 21, 2012 2011 2010 2010 ----------- ----------- ----------- ----------- (Unaudited)Changes in Operating Assets and Liabilities: Accounts Receivable 10,509 (4,715) 1,661 (8,896) Inventory 11,553 (11,649) 1,802 (9,850) Other Current Assets 16,225 16,757 5,070 (20,267) Accounts Payable (11,248) 1,035 2,593 10,759 Accrued Interest 1,832 41 881 (2,246) Other Current Liabilities 10,914 (2,514) 1,376 (2,457) ----------- ----------- ----------- ----------- Total Changes in Operating Assets and Liabilities 39,785 (1,045) 13,383 (32,957) =========== =========== =========== ===========Cash Paid for: Interest Paid $ 30,253 $ 31,149 $ - $ 32,852 Tax Refunds Received - Net (6) (11,111) - (4,859) COMMERCIAL BARGE LINE COMPANY INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDAR FROM CONTINUING OPERATIONS RECONCILIATION (In thousands) (Unaudited) Quarter Ended Dec. 31, Year Ended Dec. 31, ------------------------ ------------------------ 2012 2011 2012 2011 ----------- ----------- ----------- -----------Net Income (Loss) from Continuing Operations $ 9,666 $ 9,861 $ 20,740 $ (14,680)Adjustments from Continuing Operations: Interest Income (14) (1) (19) (163) Interest Expense 8,093 7,318 31,278 29,963 Depreciation and Amortization 20,998 26,924 101,351 108,944 Long-term Boat and Barge Rents 3,791 3,892 15,383 15,442 Taxes 3,327 6,174 9,986 (10,610) ----------- ----------- ----------- -----------EBITDAR from Continuing Operations 45,861 54,168 178,719 128,896Other Non-cash or Non- comparable Charges Included in Net Income:Share Based Compensation $ 26 $ 444 $ 260 $ 5,030Other restructuring/acquisiti on-related costs and consulting (272) 3,120 3,315 16,162Purchase accounting impact on boat/barge gains 1,252 2,127 29,563 5,815Gain on excess boat sales (2,297) - (13,240) -Insurance gain on 2011 flood claims - - (11,442) -Drought, flood and other costs 18,193 408 44,907 18,351 ----------- ----------- ----------- -----------Total non- comparable/non-cash charges $ 16,902 $ 6,099 $ 53,363 $ 45,358 ----------- ----------- ----------- -----------Adjusted EBITDAR from Continuing Operations $ 62,763 $ 60,267 $ 232,082 $ 174,254 =========== =========== =========== ===========Management considers EBITDAR to be a meaningful indicator of operating performance and uses it as a measure to assess the operating performance of the Company's business segments. EBITDAR provides us with an understanding of one aspect of earnings before the impact of investing and financing transactions and income taxes. EBITDAR should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, which is determined in accordance with generally accepted accounting principles ("GAAP"). EBITDAR excludes components that are significant in understanding and assessing our results of operations and cash flows. In addition, EBITDAR is not a term defined by GAAP and as a result our measure of EBITDAR might not be comparable to similarly titled measures used by other companies.However, the Company believes that EBITDAR is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance. COMMERCIAL BARGE LINE COMPANY TRANSPORTATION SEGMENT INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDAR FROM CONTINUING OPERATIONS RECONCILIATION (In thousands) (Unaudited) Quarter Ended Dec. 31, Year Ended Dec. 31, ------------------------ ------------------------ 2012 2011 2012 2011 ----------- ----------- ----------- -----------Income (Loss) from Continuing Operations $ 6,620 $ 7,547 $ 11,415 $ (16,862)Adjustments from Continuing Operations: Interest Income (14) (1) (19) (163) Interest Expense 8,093 7,318 31,278 29,963 Depreciation and Amortization 20,328 24,944 96,347 101,016 Long-term Boat and Barge Rents 3,791 3,892 15,383 15,442 Taxes 3,327 6,174 9,986 (10,610) ----------- ----------- ----------- -----------EBITDAR from Continuing Operations 42,145 49,874 164,390 118,786Other Non-cash or Non- comparable Charges Included in Net Income:Share Based Compensation $ 26 $ 444 $ 260 $ 5,030Other restructuring/acquisiti on-related costs and consulting (272) 3,120 3,315 15,345Purchase accounting impact on boat/barge gains 1,251 2,127 29,562 5,815Gain on excess boat sales (2,297) - (13,240) -Insurance gain on 2011 flood claims - - (11,442) -Drought, flood and other costs 17,227 - 43,941 15,994 ----------- ----------- ----------- -----------Total non- comparable/non-cash charges $ 15,935 $ 5,691 $ 52,396 $ 42,184 ----------- ----------- ----------- -----------Adjusted EBITDAR from Continuing Operations $ 58,080 $ 55,565 $ 216,786 $ 160,970 =========== =========== =========== ===========Management considers EBITDAR to be a meaningful indicator of operating performance and uses it as a measure to assess the operating performance of the Company's business segments. EBITDAR provides us with an understanding of one aspect of earnings before the impact of investing and financing transactions and income taxes. EBITDAR should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, which is determined in accordance with generally accepted accounting principles ("GAAP"). EBITDAR excludes components that are significant in understanding and assessing our results of operations and cash flows. In addition, EBITDAR is not a term defined by GAAP and as a result our measure of EBITDAR might not be comparable to similarly titled measures used by other companies.However, the Company believes that EBITDAR is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance. COMMERCIAL BARGE LINE COMPANY MANUFACTURING SEGMENT INCOME FROM CONTINUING OPERATIONS TO ADJUSTED EBITDAR FROM CONTINUING OPERATIONS RECONCILIATION (In thousands) (Unaudited) Quarter Ended Dec. 31, Year Ended Dec. 31, ----------------------- ----------------------- 2012 2011 2012 2011 ----------- ----------- ----------- -----------Income (Loss) from Continuing Operations $ 3,046 $ 2,317 $ 9,325 $ 2,187Adjustments from Continuing Operations: Depreciation and Amortization 670 1,980 5,004 7,928 ----------- ----------- ----------- -----------EBITDAR from Continuing Operations 3,716 4,297 14,329 10,115 ----------- ----------- ----------- -----------Other restructuring/acquisition- related costs and consulting $ - $ - $ - $ 817Purchase accounting impact on boat/barge gains 1 - 1 -Drought, flood and other costs 966 408 966 2,357 ----------- ----------- ----------- -----------Total non-comparable/non- cash charges $ 967 $ 408 $ 967 $ 3,174 ----------- ----------- ----------- -----------Adjusted EBITDAR from Continuing Operations $ 4,683 $ 4,705 $ 15,296 $ 13,289 =========== =========== =========== ===========Management considers EBITDAR to be a meaningful indicator of operating performance and uses it as a measure to assess the operating performance of the Company's business segments. EBITDAR provides us with an understanding of one aspect of earnings before the impact of investing and financing transactions and income taxes. EBITDAR should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, which is determined in accordance with generally accepted accounting principles ("GAAP"). EBITDAR excludes components that are significant in understanding and assessing our results of operations and cash flows. In addition, EBITDAR is not a term defined by GAAP and as a result our measure of EBITDAR might not be comparable to similarly titled measures used by other companies.However, the Company believes that EBITDAR is relevant and useful information, which is often reported and widely used by analysts, investors and other interested parties in our industry. Accordingly, the Company is disclosing this information to permit a more comprehensive analysis of its operating performance. COMMERCIAL BARGE LINE COMPANY Statement of Operating Income by Reportable Segment (In thousands) (Unaudited) Reportable Segments Intersegment ---------------------------- Transportation Manufacturing Elimination Total -------------- ------------- ------------- -------------Successor CompanyThree Months ended December 31, 2012Total revenue $ 174,193 $ 56,226 $ (22,555) $ 207,864Intersegment revenues 72 22,483 (22,555) - ------------- ------------- ------------- -------------Revenue from external customers 174,121 33,743 - 207,864Operating expense Materials, supplies and other 46,764 - - 46,764 Rent 6,585 - - 6,585 Labor and fringe benefits 28,348 - - 28,348 Fuel 42,738 - - 42,738 Depreciation and amortization 20,328 - - 20,328 Taxes, other than income taxes 2,771 - - 2,771 Gain on disposition of equipment 488 - - 488 Cost of goods sold - 30,096 - 30,096 ------------- ------------- ------------- ------------- Total cost of sales 148,022 30,096 - 178,118 Selling, general & administrative 8,290 750 - 9,040 ------------- ------------- ------------- ------------- Total operating expenses 156,312 30,846 - 187,158 ------------- ------------- ------------- -------------Operating Income $ 17,809 $ 2,897 $ - $ 20,706 ============= ============= ============= =============Three Months ended December 31, 2011Total revenue $ 200,570 $ 49,989 $ (6,055) $ 244,504Intersegment revenues 268 5,787 (6,055) - ------------- ------------- ------------- -------------Revenue from external customers 200,302 44,202 - 244,504Operating expense Materials, supplies and other 58,006 - - 58,006 Rent 6,932 - - 6,932 Labor and fringe benefits 30,011 - - 30,011 Fuel 44,688 - - 44,688 Depreciation and amortization 24,944 - - 24,944 Taxes, other than income taxes 3,137 - - 3,137 Gain on disposition of equipment (754) - - (754) Cost of goods sold - 41,494 - 41,494 ------------- ------------- ------------- ------------- Total cost of sales 166,964 41,494 - 208,458 Selling, general & administrative 12,650 479 - 13,129 ------------- ------------- ------------- ------------- Total operating expenses 179,614 41,973 - 221,587 ------------- ------------- ------------- -------------Operating Income $ 20,688 $ 2,229 $ - $ 22,917 ============= ============= ============= ============= COMMERCIAL BARGE LINE COMPANY Statement of Operating Income by Reportable Segment (In thousands) (Unaudited) Reportable Segments Intersegment ---------------------------- Transportation Manufacturing Elimination Total -------------- ------------- ------------- -------------Successor CompanyYear ended December 31, 2012Total revenue $ 687,682 $ 209,459 $ (85,584) $ 811,557Intersegment revenues 504 85,080 (85,584) - ------------- ------------- ------------- -------------Revenue from external customers 687,178 124,379 - 811,557Operating expense Materials, supplies and other 192,973 - - 192,973 Rent 26,658 - - 26,658 Labor and fringe benefits 113,432 - - 113,432 Fuel 163,698 - - 163,698 Depreciation and amortization 96,347 - - 96,347 Taxes, other than income taxes 11,316 - - 11,316 Gain on disposition of equipment (9,013) - - (9,013) Cost of goods sold - 111,343 - 111,343 ------------- ------------- ------------- ------------- Total cost of sales 595,411 111,343 - 706,754 Selling, general & administrative 39,881 3,782 - 43,663 ------------- ------------- ------------- ------------- Total operating expenses 635,292 115,125 - 750,417 ------------- ------------- ------------- -------------Operating Income $ 51,886 $ 9,254 $ - $ 61,140 ============= ============= ============= =============Year ended December 31, 2011Total revenue $ 722,244 $ 171,477 $ (40,784) $ 852,937Intersegment revenues 1,149 39,635 (40,784) - ------------- ------------- ------------- -------------Revenue from external customers 721,095 131,842 - 852,937Operating expense Materials, supplies and other 239,653 - - 239,653 Rent 27,856 - - 27,856 Labor and fringe benefits 114,812 - - 114,812 Fuel 171,607 - - 171,607 Depreciation and amortization 101,016 - - 101,016 Taxes, other than income taxes 12,344 - - 12,344 Gain on disposition of equipment (2,022) - - (2,022) Cost of goods sold - 127,871 - 127,871 ------------- ------------- ------------- ------------- Total cost of sales 665,266 127,871 - 793,137 Selling, general & administrative 54,155 1,940 - 56,095 ------------- ------------- ------------- ------------- Total operating expenses 719,421 129,811 - 849,232 ------------- ------------- ------------- -------------Operating Income $ 1,674 $ 2,031 $ - $ 3,705 ============= ============= ============= =============





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Kim Durbin
Manager Corporate Communications
American Commercial Lines
812.288.1915
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