Quality Distribution sells stock to reduce debt
Quality Distribution, the largest U.S. bulk chemical motor carrier, said Tuesday it has launched a public offering of 4 million shares of common stock at $9.50 per share.
Half the stock being offered is owned by affiliates of investment group Apollo Management, the majority owner.
Quality said it intends to use the proceeds from the sale to retire or pay down debt.
Quality's stock closed at $9.87 on Thursday, up from below $5 in August. In recent weeks the stock had reached $11.07 per share.
The company also released preliminary fourth quarter results, with an estimated net loss of $10.7 million to $11 million on revenue of $165 million. Operating income is expected to be between $6.7 million to $7 million and pre-tax earnings $14.4 million to $14.7 million.
Net income was impacted by $9.1 million in charges associated with debt refinancing and $3.2 million in restructuring costs, including $2.2 million for consolidating corporate office space.
The Tampa, Fla., chemical trucking firm closed the year with a loss of $7.4 million to $7.7 million, operating income of about $36.5 million and earnings before income, taxes and depreciation of about $62.5 million.
'Our anticipated fourth quarter results met our expectations, reflecting the typical seasonal decline versus the third quarter, and showed continued improvement in year-over-year earnings and cash flow performance,” said Gary Enzor, chief executive officer, in a statement. “With Quality’s business 95 percent affiliated, our asset-light business model continues to demonstrate the ability to generate strong free cash flow, and we are very excited about our positive momentum and solid prospects for growth in 2011.”
Apollo Management's holdings include CEVA Logistics.
Quality Distribution sells stock to reduce debt