LITTLE ROCK — USA Truck Inc. has cautioned investors in a filing with the U.S. Securities and Exchange Commission that it is not in compliance with the covenants of its credit agreement.
The Van Buren-based company said it paid a $100,000 fee to its bank group to get a waiver for failing to comply with the credit agreement, and will face another $300,000 fee if it fails to obtain refinancing by Aug. 24.
In the filing Thursday, the company said it does not expect to be in compliance with all of its covenants when it reports quarterly results on Sept. 30.
“If we do not refinance our credit agreement prior to the next measurement of financial covenants and we are unable to comply with such covenants, we would intend to seek an additional waiver at such time,” the company said. “We cannot assure you that any such waiver would be obtained or that amounts outstanding would not be accelerated.”
The filing said the compa- ny is negotiating with a lender for a new credit facility.
On July 19, USA Truck reported a second-quarter net loss of $3.5 million, or 34 cents a share.
Donald Broughton, a St. Louis-based analyst with Avondale Partners LLC, said USA Truck is facing the same challenges that most trucking companies are dealing with in the current environment.
“They’re raising driver pay, beefing up recruiting, trying to get drivers home on a more regular basis, a combination of many things,” he said. “If they can find enough drivers to fully seat the fleet, then the financial results would turn around very quickly.”
Increased regulations have made a percentage of the driving population uninsurable, he said.
The company’s unmanned tractor count averaged 12.2 percent for the quarter, down from a peak of 14.1 percent before beefed-up recruiting efforts.
USA Truck noted in its earnings release that its net loss narrowed from the previous three quarters. However, average revenue per tractor per week declined more than 9 percent to $2,546, compared with the same period a year ago.
The company cited a lagging economy, especially in manufacturing, for depressed freight volumes, but also said that its “operational excellence has been disappointing.”
“While we are actively working to optimize our freight network, we expect it to take several months to show meaningful results,” the company said.
USA Truck said it has hired consultants to analyze its processes and has added experienced key personnel to improve freight planning efficiency and improve its freight mix.
The company’s stock closed Friday at $4.04, down 6 cents and near a one-year low, in trading on the Nasdaq exchange. The stock has traded between $4 and $11.48 in the past year.
Business, Pages 27 on 08/11/2012