Target Logistics, Inc. Announces 2007 Third Quarter Results

  
    
  
  
    
      Target Logistics, Inc. (AMEX: TLG), a domestic and international freight 
      forwarder and logistics provider, today announced net income for the 
      third quarter of FY 2007, ended March 31, 2007 of $340,150 or $.02 per 
      diluted and basic share, compared to $609,642, or $.03 per diluted and 
      $.04 per basic share reported in the third quarter ended March 31, 2006. 
      Third quarter revenue increased 17.8% to $43.7 million, compared to the 
      $37.1 million reported in the comparable 2006 fiscal period.
    
    
      Operating income for the FY 2007 third quarter was $613,983 compared to 
      the $1,107,182 reported in the comparable FY 2006 third quarter.
    
    
      For the nine month period ended March 31, 2007, net income was $1.207 
      million or, $0.06 per basic and diluted share compared to $2.063 
      million, or $.10 per diluted and $.12 per basic share for the nine month 
      period ended March 31, 2006. Nine month revenue increased 12.3% to 
      $134.7 million from the $119.9 million reported in the comparable FY 
      2006 period.
    
    
      Operating income for the nine month period of FY 2007 was $2,299,210 
      compared to the $3,754,818 reported in the FY 2006 comparable nine month 
      period.
    
    
      “Despite achieving our 18th 
      consecutive profitable quarter, third quarter net income was 
      disappointing, primarily because of continued losses by our New York 
      City station following our Discovery acquisition last year, and less 
      than anticipated gross profit margin improvement as a result of sluggish 
      value-added services growth,” said Stuart 
      Hettleman, President and CEO. “We have taken 
      the appropriate steps to right size the New York operations and expect 
      to achieve profitability at this station in the fourth quarter.
    
    
      “We had projected a strong 2nd 
      half for fiscal 2007 during our second quarter conference call. Although 
      our results for the 3rd quarter are 
      significantly less than we expected, we are still very optimistic for 
      the future. We do still expect a solid 4th 
      quarter, but we do not believe that we will be able to overcome the 
      shortfall in our 3rd quarter results to achieve 
      our current goals. As a result, while we still believe that we will 
      achieve the lower end of our revenue guidance of a 15% to 22% increase 
      over fiscal 2006, we are lowering our earnings guidance for fiscal 2007 
      to $.08 to $.10 per share on a fully diluted basis.
    
    
      “Our Company remains focused on executing its 
      proven strategy – Consistent year on year 
      revenue increases driven by internal sales growth and accretive 
      acquisitions, while further reducing SG&A as a percentage of revenue and 
      improving our gross profit margins,” concluded 
      Mr. Hettleman.
    
    
      Philip Dubato, Chief Financial Officer of Target Logistics, added, “We 
      are pleased that our new Wells Fargo credit facility is in place and at 
      March 31, 2007 we had over $16.1 million in cash and available credit to 
      support our strategies for internal growth and our ability to make 
      strategic acquisitions.”
    
    
      Target Logistics will hold a conference call at 4:00 PM. ET on 
      Wednesday, May 2, 2007. Interested parties are invited to listen 
      to the call live, over the Internet at www.targetlogistics.com. 
      The live call may also be accessed at http://phx.corporate-ir.net/playerlink.zhtml?c=62341&s=wm&e=1539271. 
      The call will also be available by dialing [phone], or 
      for international callers, [phone] and by using the 
      confirmation code 32625245. A replay of the teleconference will 
      be available until June 2, 2007 at www.targetlogistics.com. 
      A replay will also be available by dialing [phone] 
      (domestic) or [phone] (international) and by using 
      confirmation code 22699898.
    
    
      Target Logistics, Inc. provides domestic and international time definite 
      freight forwarding and logistics services through its wholly owned 
      subsidiary, Target Logistic Services, Inc. Target has a network of 
      offices in 35 cities throughout the United States and a worldwide agent 
      network with coverage in over 70 countries. Its freight forwarding 
      services include arranging for the total transport of customers' 
      freight, including providing door to door service, distributions and 
      reverse logistics.
    
    
      Statements contained in this press release that are not historical facts 
      are forward-looking statements as that term is defined in the Private 
      Securities Litigation Reform Act of 1995. Although Target Logistics 
      believes that the expectations reflected in such forward-looking 
      statements are reasonable, the forward-looking statements are subject to 
      risks and uncertainties that could cause actual results to differ 
      materially from those projections.
    
    
      
        
          Target Logistics, Inc. and Subsidiaries
        
      
      
        
          Consolidated Statements of Operations
        
      
      
        
          (unaudited)
        
      
      
        
           
        
      
      
        
        
        
        
        
          Three months ended March 31,
        
        
        
        
          Nine months ended March 31,
        
      
      
        
        
        
        
        
          
            2007 
          
        
        
        
        
          
            2006 
          
        
        
        
        
          
            2007 
          
        
        
        
        
          
            2006 
          
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating revenues
        
        
        
        
          $
        
        
          43,727,756 
        
        
        
        
          $
        
        
          37,114,144 
        
        
        
        
          $
        
        
          134,726,385 
        
        
        
        
          $
        
        
          119,964,069 
        
      
      
        
          Cost of transportation
        
        
        
        
           
        
        
          30,552,567 
        
        
        
        
           
        
        
          25,393,650 
        
        
        
        
           
        
        
          94,765,607 
        
        
        
        
           
        
        
          82,196,489 
        
      
      
        
          Gross profit
        
        
        
        
        
        
          13,175,189 
        
        
        
        
        
        
          11,720,494 
        
        
        
        
        
        
          39,960,778 
        
        
        
        
        
        
          37,767,580 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Selling, general and administrative expenses ("SG&A"):
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Target subsidiary (exclusive forwarder commissions)
        
        
        
        
        
        
          3,620,334 
        
        
        
        
        
        
          3,306,961 
        
        
        
        
        
        
          12,102,238 
        
        
        
        
        
        
          12,092,788 
        
      
      
        
          SG&A - Target subsidiary
        
        
        
        
        
        
          8,477,770 
        
        
        
        
        
        
          6,807,242 
        
        
        
        
        
        
          24,122,246 
        
        
        
        
        
        
          20,475,522 
        
      
      
        
          SG&A - Corporate
        
        
        
        
        
        
          250,222 
        
        
        
        
        
        
          333,221 
        
        
        
        
        
        
          823,129 
        
        
        
        
        
        
          997,728 
        
      
      
        
          Depreciation and amortization
        
        
        
        
           
        
        
          212,880 
        
        
        
        
           
        
        
          165,888 
        
        
        
        
           
        
        
          613,955 
        
        
        
        
           
        
        
          446,724 
        
      
      
        
          Selling, general and administrative expenses
        
        
        
        
        
        
          12,561,206 
        
        
        
        
        
        
          10,613,312 
        
        
        
        
        
        
          37,661,568 
        
        
        
        
        
        
          34,012,762 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating income
        
        
        
        
        
        
          613,983 
        
        
        
        
        
        
          1,107,182 
        
        
        
        
        
        
          2,299,210 
        
        
        
        
        
        
          3,754,818 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Other income (expense):
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Interest (expense)
        
        
        
        
           
        
        
          (34,177)
        
        
        
        
           
        
        
          (40,611)
        
        
        
        
           
        
        
          (118,291)
        
        
        
        
           
        
        
          (118,519)
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Income before taxes
        
        
        
        
        
        
          579,806 
        
        
        
        
        
        
          1,066,571 
        
        
        
        
        
        
          2,180,919 
        
        
        
        
        
        
          3,636,299 
        
      
      
        
          Provision for income taxes
        
        
        
        
           
        
        
          239,656 
        
        
        
        
           
        
        
          456,929 
        
        
        
        
           
        
        
          974,313 
        
        
        
        
           
        
        
          1,573,265 
        
      
      
        
          Net income
        
        
        
        
          $
        
        
          340,150 
        
        
        
        
          $
        
        
          609,642 
        
        
        
        
          $
        
        
          1,206,606 
        
        
        
        
          $
        
        
          2,063,034 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net Income per share attributable to common shareholders:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Basic
        
        
        
        
          $
        
        
          0.02 
        
        
        
        
          $
        
        
          0.04 
        
        
        
        
          $
        
        
          0.06 
        
        
        
        
          $
        
        
          0.12 
        
      
      
        
          Diluted
        
        
        
        
          $
        
        
          0.02 
        
        
        
        
          $
        
        
          0.03 
        
        
        
        
          $
        
        
          0.06 
        
        
        
        
          $
        
        
          0.10 
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Weighted average shares outstanding:
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Basic
        
        
        
        
           
        
        
          18,076,735 
        
        
        
        
           
        
        
          16,692,679 
        
        
        
        
           
        
        
          18,043,341 
        
        
        
        
           
        
        
          16,203,763 
        
      
      
        
          Diluted
        
        
        
        
           
        
        
          21,480,385 
        
        
        
        
           
        
        
          21,490,385 
        
        
        
        
           
        
        
          21,480,385 
        
        
        
        
           
        
        
          21,490,361 
        
      
    
    
      
        
          Target Logistics, Inc. and Subsidiaries
        
      
      
        
          Selected Balance Sheet Data
        
      
      
        
           
        
      
      
        
        
        
        
        
          March 31,
        
        
        
        
          June 30,
        
      
      
        
        
        
        
        
          2007 
        
        
        
        
          2006 
        
      
      
        
        
        
        
        
          (unaudited)
        
        
        
        
          (audited)
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Cash and Cash Equivalents
        
        
        
        
          $
        
        
          4,782,002 
        
        
        
        
          $
        
        
          7,015,018 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total Current Assets
        
        
        
        
          $
        
        
          31,665,215 
        
        
        
        
          $
        
        
          29,797,740 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total Assets
        
        
        
        
          $
        
        
          47,795,307 
        
        
        
        
          $
        
        
          45,250,881 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Current Liabilities
        
        
        
        
          $
        
        
          24,542,926 
        
        
        
        
          $
        
        
          23,014,672 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Long Term Liabilities
        
        
        
        
          $
        
        
          309,660 
        
        
        
        
          $
        
        
          555,199 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Working Capital
        
        
        
        
          $
        
        
          7,122,289 
        
        
        
        
          $
        
        
          6,783,068 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Shareholders' Equity
        
        
        
        
          $
        
        
          22,942,721 
        
        
        
        
          $
        
        
          21,681,010 
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Credit Line Availability
        
        
        
        
          $
        
        
          11,300,996 
        
        
        
        
          $
        
        
          11,274,357