JACKSONVILLE, Fla., Aug. 6 /EMWNews/ -- Patriot

Transportation Holding, Inc. (Nasdaq: PATR) reported net income of

$2,774,000 or $0.89 per diluted share in the third quarter of fiscal 2008,

an increase of $348,000 or 14.3% compared to net income of $2,426,000 or

$0.77 per diluted share in the same period last year. Net income for the

first nine months of fiscal 2008 was $4,805,000 or $1.54 per diluted share,

a decrease of $2,378,000 compared to net income of $7,183,000 or $2.30 per

diluted share for the same period last year.



    Net income for the first nine months of fiscal 2008 benefited from a

gain on condemnation of land of $1,544,000, net of income taxes but was

adversely impacted by the accrual of retirement benefits of $1,541,000, net

of income tax benefits, for the Company's previous President and CEO, whose

retirement was effective February 6, 2008. The transportation segment was

negatively impacted in the first nine months of fiscal 2008 by reduced

demand for flatbed trucking services and high fuel expenses. The first nine

months of fiscal 2007 benefited from gains on equipment sales and prior

period insurance recoveries.



    Third Quarter Operating Results. For the third quarter of fiscal 2008,

consolidated revenues were $46,061,000, an increase of $6,430,000 or 16.2%

over the same quarter last year.



    Transportation segment revenues were $39,990,000 in the third quarter

of 2008, an increase of $5,883,000 over the same quarter last year. Revenue

miles in the current quarter were down 2.6% compared to the third quarter

of 2007 due to reduced loads in the flatbed portion of the transportation

segment. Excluding fuel surcharges, revenue per mile increased 8.4% over

the same quarter last year. In addition to general rate increases, a shift

to new business in the flatbed division was a significant factor in this

increase.



    Real Estate segment revenues for the third quarter of fiscal 2008 were

$6,071,000, an increase of $547,000 or 9.9% over the same quarter last

year. Lease revenue from developed properties increased $311,000 or 8.1%,

due to an increase in occupied square footage, higher rental rates on new

leases, and increased revenue from reimbursed real estate taxes. Royalties

and land rent increased $236,000 or 13.9% due to increased reimbursements

for real estate taxes and higher tons sold.



    Consolidated gross profit was $8,628,000 in the third quarter of fiscal

2008, an increase of $834,000 or 10.7% compared to $7,794,000 in the same

period last year. Gross profit in the transportation segment increased

$778,000 or 16.2% as increased revenue per mile more than offset reduced

demand for flatbed trucking services and high fuel expenses. Gross profit

in the real estate segment increased $56,000 or 1.9% from the third quarter

2007, due to higher rental rates on new leases offset by increased real

estate taxes that could not be billed to tenants.



    Selling, general and administrative expenses increased $392,000 over

the same quarter last year. Payroll and payroll taxes increased $247,000

due to amounts paid to the Company's prior CFO who retired June 16, 2008

along with additional staffing and payroll taxes on stock option exercises.



    Nine Months Operating Results. For the first nine months of fiscal

2008, consolidated revenues were $126,349,000, an increase of $11,438,000

or 10.0% over the same period last year.



    Transportation segment revenues were $107,647,000 in the first nine

months of 2008, an increase of $9,228,000 over the same period last year.

Revenue miles in the first nine months of fiscal 2008 were down 3.1%

compared to the first nine months of fiscal 2007 due to reduced loads in

the flatbed portion of the transportation segment. Excluding fuel

surcharges, revenue per mile increased 5.3% over the same period last year.

In addition to general rate increases the addition of new business in the

flatbed division during the third quarter was a significant factor in this

increase. Until the third quarter decreased construction material freight

demand and pricing softness from the downturn in housing pushed revenues

down in the flatbed operation compared to the same period last year.



    Real Estate segment revenues for the first nine months of fiscal 2008

were $18,702,000, an increase of $2,210,000 or 13.4% over the same period

last year. Lease revenue from developed properties increased $1,125,000 or

9.6%, due to an increase in occupied square footage along with higher

rental rates on new leases. Royalties and land rent increased $1,085,000 or

22.5% despite reduced tons mined because of an increase of $359,000 in

revenues from timber harvesting, revenue of $383,000 for reimbursement of

higher real estate taxes, and increases in royalties per ton.



    Consolidated gross profit was $20,904,000 in the first nine months of

fiscal 2008, a decrease of $2,772,000 or 11.7% compared to $23,676,000 in

the same period last year. Gross profit in the transportation segment

decreased $3,407,000 or 22.8% due to the increase in cost of operations

along with decreased freight demand, resulting in reduced revenue miles in

the flatbed portion. Average fuel cost per gallon in the first nine months

of 2008 increased 41% over the same period last year. This resulted in an

increase in fuel cost of $679,000 in excess of the increase in fuel

surcharge revenue in the flatbed portion. Insurance and losses increased

$1,790,000 primarily due to the same period last year including a reduction

of expense for changes in estimated prior year retained loss reserves as of

June 30, 2007 along with a $357,000 of prior year insurance recoveries

recorded in the three months ended December 31, 2006. Other expense

increased $1,393,000 due to $752,000 higher gains on equipment sales the

same period last year along with an increase of $708,000 in vehicle tires

and maintenance. Gross profit in the real estate segment increased $635,000

or 7.3% from the first nine months 2007, due to higher rental rates on new

leases and $359,000 increased gross profit from timber harvesting offset by

increased real estate taxes that could not be billed to tenants.



    Selling, general and administrative expenses increased $3,171,000 over

the same period last year. The current year includes $2,503,000 accrual of

retirement benefits for the Company's previous President and CEO. Payroll

and payroll taxes increased $352,000 due to amounts paid to the Company's

prior CFO who retired June 16, 2008 along with additional staffing and

payroll taxes on stock option exercises. Estimated allowance for doubtful

accounts expense increased $78,000 primarily due to the inclusion in the

prior year of a reversal of prior accruals. Audit and legal fees increased

$89,000 due to various projects.



    Summary and Outlook. The flatbed portion of the transportation segment

continues to face poor freight demand from the housing downturn as well as

high fuel expenses. During the third quarter of fiscal 2008, increased

revenue per mile in the transportation segment more than offset reduced

demand for flatbed trucking services and high fuel expenses.



    The Company's real estate development business continues to expand its

portfolio of warehouse-office products consistent with maintaining a

watchful eye on national and regional economic health.



    In July 2008, a subsidiary of the Company, FRP Bird River, LLC, entered

into an agreement to sell approximately 121 acres of land in Baltimore

County, Maryland to Mackenzie Investment Group, LLC. The purchase price for

the property is $25,265,000, subject to certain potential purchase price

adjustments. The agreement of sale is subject to certain contingencies,

including the satisfactory completion of the buyer's inspection period.

Closing is dependent upon several conditions including additional

government approvals and may be two or more years away.



    In May 2008, the Company received final approval from the Zoning

Commission of the District of Columbia of its planned unit development

application for the Company's 5.8 acre undeveloped waterfront site on the

Anacostia River in Washington, D.C. This site is located adjacent to the

recently opened Washington Nationals Baseball Park. The site currently is

leased to a subsidiary of Vulcan Materials Company under a short-term

lease. The approved planned unit development permits the Company to develop

a four building, mixed use project, containing approximately 545,800 square

feet of office and retail space and approximately 569,600 square feet of

additional space for residential and hotel uses. The approved development

would include numerous publicly accessible open spaces and a waterfront

esplanade along the Anacostia River.



    Investors are cautioned that any statements in this press release which

relate to the future are, by their nature, subject to risks and

uncertainties that could cause actual results and events to differ

materially from those indicated in such forward-looking statements. These

include general economic conditions; competitive factors; political,

economic, regulatory and climatic conditions; driver availability and cost;

the impact of future regulations regarding the transportation industry;

freight demand for petroleum product and levels of construction activity in

the Company's markets; fuel costs; risk insurance markets; demand for

flexible warehouse/office facilities; ability to obtain zoning and

entitlements necessary for property development; interest rates; levels of

mining activity; pricing; energy costs and technological changes.

Additional information regarding these and other risk factors and

uncertainties may be found in the Company's filings with the Securities and

Exchange Commission.



    Patriot Transportation Holding, Inc. is engaged in the transportation

and real estate businesses. The Company's transportation business is

conducted through two wholly owned subsidiaries. Florida Rock & Tank Lines,

Inc. is a Southeastern transportation company concentrating in the hauling

by motor carrier of liquid and dry bulk commodities. SunBelt Transport,

Inc. serves the flatbed portion of the trucking industry in the

Southeastern states, hauling primarily construction materials. The

Company's real estate group, comprised of FRP Development Corp. and Florida

Rock Properties, Inc., acquires, constructs, leases, operates and manages

land and buildings to generate both current cash flows and long-term

capital appreciation. The real estate group also owns real estate which is

leased under mining royalty agreements or held for investment.










                     PATRIOT TRANSPORTATION HOLDING, INC.

          Summary of Consolidated Revenues and Earnings (unaudited)

                   (In thousands except per share amounts)





                                        Three Months         Nine Months

                                           Ended                Ended

                                          June 30              June 30

                                      2008       2007       2008     2007



    Revenues                       $ 46,061     39,631   $126,349  114,911

    Gross profit                     $8,628      7,794    $20,904   23,676

    Income before income taxes       $4,240      3,979     $7,711   11,782

    Net income                       $2,774      2,426     $4,805    7,183

    Earnings per common share:

      Basic                           $0.92       0.80      $1.58     2.38

      Diluted                         $0.89       0.77      $1.54     2.30

    Weighted average common shares

     outstanding:

    Basic                             3,024      3,035      3,034    3,016

    Diluted                           3,114      3,142      3,130    3,125







                     PATRIOT TRANSPORTATION HOLDING, INC.

                     Condensed Balance Sheets (unaudited)

                            (Amounts in thousands)



                                                     June 30     September 30

                                                       2008           2007



    Cash and cash equivalents                        $15,916        $26,944

    Accounts receivable, net                          12,460         10,983

    Other current assets                               5,547          6,559

    Property, plant and equipment, net               204,997        192,523

    Investment in Brooksville Joint Venture            6,305          5,904

    Other non-current assets                          10,160         10,617

      Total Assets                                 $ 255,385      $ 253,530



    Current liabilities                              $21,218        $20,228

    Long-term debt (excluding current maturities)     77,183         80,172

    Deferred income taxes                             17,155         15,274

    Other non-current liabilities                      6,106          7,395

    Shareholders' equity                             133,723        130,461

      Total Liabilities and Shareholders' Equity   $ 255,385      $ 253,530







                     PATRIOT TRANSPORTATION HOLDING, INC.

                        Business Segments (unaudited)

                            (Amounts in thousands)

    The Company has identified two business segments, Transportation and

Real Estate, each of which is managed separately along product lines. All

of the Company's operations are located in the Southeastern and

Mid-Atlantic states. Operating results for the Company's business segments

are as follows:










                                    Three Months Ended   Nine Months Ended

                                          June 30             June 30

                                       2008     2007       2008      2007



    Transportation Revenues          $39,990   34,107   $107,647    98,419

    Real Estate Revenues               6,071    5,524     18,702    16,492



    Total Revenues                   $46,061   39,631   $126,349   114,911





    Transportation Operating Profit   $3,318    2,600     $4,940     8,452

    Real Estate Operating Profit       3,055    2,999      9,343     8,708

    Corporate Expenses                (1,070)    (738)    (5,746)   (2,680)



    Total Operating Profit            $5,303    4,861     $8,537    14,480