EGL, Inc. Reports Diluted EPS of $0.40 Operating Income Increased 39% HOUSTON, Nov. 3 /PRNe... EGL, Inc. Reports Diluted EPS of

HOUSTON, Nov. 3 /PRNewswire-FirstCall/ -- EGL, Inc. (Nasdaq: EAGL - News ) announced that diluted earnings per share for the third quarter of 2005 increased 18% to $0.40 compared to $0.34 in the third quarter of 2004. Diluted earnings per share of $0.34 for last year's third quarter included a $0.06 per share gain from the sale of the Company's interest in TDS (excluding this gain, earnings per share in last year's third quarter were $0.28). Gross revenues increased 8% to $780 million for the quarter ended September 30, 2005 compared to $719 million in the same quarter of 2004.

EGL Chief Executive Officer Jim Crane commented, "Our quarterly results were bolstered by a very strong September. We remain focused on three key areas: (1) improving yields by focusing on profitable accounts and enhancing certain business that does not generate margins we believe to be appropriate for the services we provide, (2) eliminating operational inefficiencies through process improvements, and (3) increasing cash flow from operations. We are seeing the impact of the actions we initiated earlier this year on recovery of fuel costs, phasing out of marginally profitable accounts, reducing our cost structure, improving our profitability in Europe and Canada, and improving our working capital management. The efforts of all our employees are contributing nicely toward our goals of improving profitability and enhancing shareholder value."

Gross revenues increased 8% over the third quarter of 2004 to $780 million, reflecting a 10% increase in airfreight revenues and a 10% increase in customs brokerage and logistics, partially offset by a 2% decrease in ocean revenues. Gross revenues outside North America increased 12% due to the higher volumes from Asia and higher fuel costs that were passed on to our customers.

Net revenues of $247 million in the third quarter of 2005 increased by 9% from the same quarter last year. Net revenue margins of 31.7% improved by 30 basis points over the third quarter of 2004, due to improvements in ocean and logistics net revenue margins.

In the third quarter of 2005 operating income increased 39% to $33.0 million, as compared to the third quarter of 2004, while operating expenses increased by only 6% to $214 million.

Non-operating income of $380,000 in the third quarter of 2005 decreased significantly from the same quarter last year as the third quarter of last year included a gain of $5.4 million from the sale of the Company's interest in TDS.

Third quarter 2005 operating income of $33.0 million was a record high for the Company. Operating income as a percent of net revenue for the third quarter of 2005 was 13.4% compared to 10.5% in the third quarter of 2004.

Total cash, restricted cash and short-term investments increased to $143 million at September 30, 2005 compared to $111 million at December 31, 2004. During the second and third quarters of 2005, the Company repurchased 4.97 million shares of its common stock in the open market for $94 million.

In addition to these share repurchases, the Company also completed a modified "Dutch Auction" self-tender offer to purchase up to 9,615,000 million shares of its common stock on October 4, 2005. In the tender offer, the Company purchased 8,085,958 shares at a per share purchase price of $26.00 for a total of $210.2 million. After this repurchase, 39,237,972 shares remained outstanding. The Company financed the tender offer with the use of cash on hand and borrowings of $196 million under both a new $300 million line of credit facility and a $100 million bridge loan that was refinanced by the issuance of $100 million of floating rate senior secured notes due in October 2012.

EGL expects diluted earnings per share in the range of $0.38 to $0.42 for the fourth quarter of 2005 compared to $0.26 in the fourth quarter of last year.

EGL, Inc. plans to host a conference call for shareholders and the investing community on November 3, 2005 at 11 a.m. Eastern time (8 a.m. Pacific) to review results for the quarter ended September 30, 2005. The call can be accessed by dialing (719) 457-2600, access code 8045306 and is expected to last approximately 60 minutes. Callers are requested to dial in at least 5 minutes before the start of the call. The call will also be available through live webcast on the Company's website, http://www.eaglegl.com , on the Investor Relations page. An audio replay will be available until Friday, November 18, 2005 at (719) 457-0820, access code 8045306.

Houston-based EGL, Inc. operates under the name EGL Eagle Global Logistics. EGL is a leading global transportation, supply chain management and information services company dedicated to providing superior flexibility and fewer shipping restrictions on a price competitive basis. With 2004 revenues exceeding $2.7 billion, EGL's services include air and ocean freight forwarding, customs brokerage, local pickup and delivery service, materials management, warehousing, trade facilitation and procurement, and integrated logistics and supply chain management services. The Company's shares are traded on the NASDAQ National Market under the symbol "EAGL".

The statements in this press release (and statements in the conference call referred to above) regarding projected revenue growth, profitability and earnings per share (including guidance), growth opportunities, yield improvement, increased efficiencies, improvements in operating and financial systems, effective tax rates, our ability to pass-through fuel costs, expected insurance recoveries, stock repurchases, and other statements which are not historical facts, are forward looking statements. Such statements involve risks and uncertainties including, but not limited to, general economic conditions, risks associated with operating in international markets, the results of litigation, the timing and effects of any improvements in the regions and industry sectors in which the Company's customers operate, construction of new facilities and other infrastructure improvements, ability to manage and continue growth, competition, ability to renegotiate customer contracts and other factors detailed in the Company's 2004 Form 10-K and other filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize (or the consequences of such a development worsen), or should underlying assumptions prove incorrect, actual outcomes may vary materially from those forecasted or expected. The Company disclaims any intention or obligation to update publicly or revise such statements, whether as a result of new information, future events or otherwise.

EGL, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (in thousands, except per share amounts) Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 Revenues $779,507 $719,417 $2,261,427 $1,941,285 Cost of transportation 532,547 493,492 1,564,539 1,305,548 Net revenues 246,960 225,925 696,888 635,737 Operating expenses: Personnel costs 129,349 126,555 390,473 356,336 Other selling, general and administrative expenses 84,567 75,545 238,645 226,368 Operating income 33,044 23,825 67,770 53,033 Nonoperating income, net 380 3,121 2,242 8,942 Income before provision for income taxes 33,424 26,946 70,012 61,975 Provision for income taxes 14,192 10,371 30,913 23,987 Net income $19,232 $16,575 $39,099 $37,988 Basic earnings per share $0.41 $0.37 $0.78 $0.84 Diluted earnings per share $0.40 $0.34 $0.78 $0.79 Basic weighted-average common shares outstanding 47,300 44,801 49,974 45,478 Diluted weighted-average common shares outstanding 47,602 51,202 50,316 51,687 EGL, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (in thousands) September 30, December 31, 2005 2004 ASSETS Current assets: Cash, cash equivalents, restricted cash and short-term investments $142,857 $110,509 Trade accounts receivable, net of allowance 541,242 611,594 Other current assets 68,777 56,034 Total current assets 752,876 778,137 Property and equipment, net 190,317 178,218 Investments in unconsolidated affiliates 553 619 Goodwill, net 110,960 108,470 Other assets, net 37,267 29,419 Total assets $1,091,973 $1,094,863 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $13,492 $19,426 Trade payables and accrued transportation costs 363,230 337,137 Accrued expenses and other liabilities 160,765 134,107 Total current liabilities 537,487 490,670 Long-term debt 19,817 12,752 Other noncurrent liabilities 37,570 38,207 Minority interest 1,419 802 Stockholders' equity 495,680 552,432 Total liabilities and stockholders' equity $1,091,973 $1,094,863 EGL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in thousands) Nine Months Ended September 30, 2005 2004 Cash flows from operating activities: Net income $39,099 $37,988 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 26,860 25,912 Bad debt expense 6,412 4,857 Transfers (to) from restricted cash 5,042 (351) Other (403) (11,548) Net effect of changes in working capital, net of assets acquired 92,970 (15,204) Net cash provided by operating activities 169,980 41,654 Cash flows from investing activities: Capital expenditures (32,623) (31,448) Purchase of short-term investments 540 (43) Proceeds from sales of other assets 1,456 873 Acquisitions of businesses, net of cash acquired - (16,216) Earnout payments (4,186) (3,291) Cash received from disposal of affiliates - 52,123 Collection of notes receivable 1,618 552 Net cash provided by (used in) investing activities (33,195) 2,550 Cash flows from financing activities: Issuance of debt, net (4,834) 2,234 Repayment of financed insurance premiums and software, net (2,251) (4,666) Repayment of capital leases (1,525) (781) Repurchases of common stock (94,293) (59,079) Payment of deferred financing fees (1,055) (1,067) Issuance of common stock 535 319 Proceeds from exercise of stock options 6,206 22,932 Cash received from a minority interest partner 636 - Dividends paid to minority interest partners (82) (114) Net cash used in financing activities (96,663) (40,222) Effect of exchange rate changes on cash (2,163) (3,203) Increase in cash and cash equivalents 37,959 779 Cash and cash equivalents, beginning of the period 92,918 94,099 Cash and cash equivalents, end of the period $130,877 $94,878 Third quarter 2005 product and geographic data and air freight statistics are available on EGL's website, http://www.eaglegl.com on the Investor Relations page.

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