John Simone, the USA Truck boss who managed what is considered by many to be an impressive financial turnaround by the Van Buren-based company, has resigned to focus on his battle with lung cancer.
The company announced April 6 that Simone, 53, was on indefinite leave from the company to deal with a “serious medical condition.” On May 7 Simone said he suffered from strokes and lung cancer and would take an indefinite leave of absence. Simone said the lung cancer was discovered while searching for the cause of strokes.
Thomas Glaser, who was in charge during Simone’s leave of absence, has been named president and CEO of USA Truck.
“Although it has been a very difficult decision, after consultation with my doctors, who continue to be optimistic about my recovery, I have concluded that I need to concentrate full time on my treatments and recovery,” Simone said in a statement the company issued Thursday (July 9). “I leave knowing that a solid foundation for profitability and growth has been put into place at USA Truck. Working with the Company and its outstanding employees has been a very rewarding experience, and I look forward to watching USA Truck’s continuing progress.”
In late 2012 the USA Truck Board of Directors reached out to Harvard graduate Robert Peiser to chair the Board and get the company back in the black. Peiser, known in corporate circles as someone able to rescue a company for future growth or acquisition, hired John Simone in early 2013. He had a reputation in the trucking and logistics sector for tidying up troubled operations.
Peiser and Simone began making wholesale changes to USA Truck’s corporate philosophy, management and strategy. Officials with the long-haul trucking and logistics company announced 2014 net income of $6.033 million, a more than $15 million swing from the $9.11 million loss in 2014, and a gain that ended five consecutive years of losses.
The company’s trucking segment is still struggling, however. The trucking division posted a $3.532 million operating income loss in 2014 – although it was a big improvement over the $17.66 million operating income loss in 2013. Driving the gains are the non-asset side of USA Truck’s operation. The company’s Strategic Capacity Solutions (SCS) – logistics and freight brokerage – division posted operating income of $20.775 million, more than double the $9 million in 2013.
Peiser said the Board understands Simone’s decision and praised his time with the company.
“We fully support John’s decision to resign so he can devote his time and energy to improving his health. During his tenure of more than two years, he reinvigorated the Company, began the process of unlocking its earnings potential, and instilled every employee with the desire to maintain its forward momentum. All of us wish John continued success with his recovery,” Peiser said in the statement.
Peiser also said the USA Truck Board is “confident” that Glaser will “continue to drive USA Truck’s turnaround and implement the Company’s multi-pronged growth strategy.”
Glaser is a member of the USA Truck Board and served as the company’s COO from January 2013 to June 2013. He returned to the company as a Board member as part of an early 2014 agreement between USA Truck and investment firms Baker Street Capital and Stone House Capital Management. He has more than 30 years of management experience in the trucking industry, including serving as president of two truckload carriers, Arnold Transportation Services from 2008 to 2010 and Celadon Trucking Services, Inc. from 2001 to 2007. Between 1988 and 2001, Mr. Glaser served in various positions as a vice president in operations, marketing and sales at Contract Freighters, Inc. (now Con-way Truckload).
An estimated $1.3 million charge to third quarter earnings will cover severance and other costs of Simone’s resignation.
The company is set to announce second quarter earnings on Aug. 4. The consensus estimate is that the company will post net income of 22 cents per share on revenue of $142.5 million. In the second quarter of 2014, the company reported 20 cents per share on revenue of $153.3 million, although 13 cents were set aside to cover $2.2 million in legal costs related to a hostile takeover attempt by Knight Transportation.
USA Truck shares (NASDAQ: USAK) were trading early Thursday at $21.06. The share price closed Wednesday at $20.69. During the past 52 weeks the share price has ranged from a $32.14 high to a $13.90 low.