Boston, MA 05/16/2014 (wallstreetpr) – School bus transportation provider Student Transportation Inc (NASDAQ:STB) signed a new contract with San Bernardino Country Superintendent of Schools. The contract will run for five years and is worth $10 million.
The latest contract calls for a fleet of 133 new clean-diesel buses and 31 propane-autogas buses. The company said the new contract begins in January, and it has enough time to assemble its team and facilities for the new job. The company intends to use the period before the service begins to bring drivers for route optimization and safety testing.
Contract renewal
In addition to the new contract, Student Transportation Inc (NASDAQ:STB) also announced an extension of contracts with customers under Atlantic Express, a company that it acquired in February. The acquisition included $26 million in annualized revenue and 425 vehicles. The deal expanded the company’s customer base and many customers in the previous contracts have renewed their service with Student Transportation and have also issued good recommendations for the company.
Through the acquisition, the company said its fleet in Los Angeles area for next year will be about 600 vehicles. It continues to integrate Atlantic Express into its operations.
Way forward
Student Transportation Inc (NASDAQ:STB) intends to continue marketing its services while acquiring strategic assets as it pursues growth. Improvement in marketing efforts should attract more customers and lead to higher revenue. Strategic acquisitions are also expected to support rapid expansion of market share and asset portfolio.
In addition to attracting higher revenue, the company looks to controlling its expenses with the aim of achieving more cost-savings to support profit growth.
Financial performance
Student Transportation Inc (NASDAQ:STB) has some work to do about its financial performance. The company reported 3Q2014 earnings that missed consensus estimates. The company earned $0.03 per share, yet analysts expected $0.04 per share.
However, analysts are optimistic about the company’s future, and it has earned ratings upgrade in recent times. Shares of the company are up 2.1 percent year-to-date.
