Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - HUNT J B TRANSPORT SERVICES INC | jbht20131016b_8k.htm |
Exhibit 99.1
J.B. Hunt Transport Services, Inc. Contact: David G. Mee 615 J.B. Hunt Corporate Drive Executive Vice President, Finance/Administration Lowell, Arkansas 72745 and Chief Financial Officer (479) 820-8363
FOR IMMEDIATE RELEASE
J. B. HUNT TRANSPORT SERVICES, INC. REPORTS EARNINGS FOR THE THIRD QUARTER 2013
|
■ Third Quarter 2013 Revenue: |
$1.44 billion; up 11% |
|
■ Third Quarter 2013 Operating Income: |
$151 million; up 13% |
|
■ Third Quarter 2013 EPS: |
75 cents vs. 65 cents |
LOWELL, ARKANSAS, October 15, 2013 - J. B. Hunt Transport Services, Inc., (NASDAQ:JBHT) announced third quarter 2013 net earnings of $89.5 million, or diluted earnings per share of 75 cents vs. third quarter 2012 net earnings of $78.2 million, or 65 cents per diluted share.
Total operating revenue for the current quarter was $1.44 billion, compared with $1.30 billion for the third quarter 2012. Load growth of 11.6% in Intermodal (JBI), implementation of new private fleet conversions in Dedicated Contract Services (DCS)™ and an increase in revenue per load in Integrated Capacity Solutions (ICS), helped drive segment revenue increases of 12%, 17% and 13%, respectively. Truck (JBT) segment revenue decreased by 17%, primarily from a smaller fleet and lower tractor utilization. Current quarter total operating revenue, excluding fuel surcharges, also increased 11% vs. the comparable quarter 2012.
Operating income for the current quarter totaled $151 million vs. $133 million for the third quarter 2012. The increase in operating income from load growth, higher JBI box turns and freight mix was partially offset by increases in driver recruiting costs, higher rates paid to third party carriers for dray, brokerage and truckload services, higher driver mileage pay, higher equipment costs, and lower tractor utilization in JBT due to moderate customer demand and new hours of service regulations.
Interest expense in the current quarter decreased slightly due to lower interest rates from a year ago. The effective income tax rate for both the current quarter and third quarter 2012 was 38.25%. We expect our 2013 annual tax rate to be approximately 38.15%.
Segment Information:
Intermodal (JBI)
■ Third Quarter 2013 Segment Revenue: $890 million; up 12%
■ Third Quarter 2013 Operating Income: $118.0 million; up 21%
Overall volumes increased 11.6% over the same period in 2012 in an environment of moderating fuel prices and less seasonally volatile freight demand. Eastern network growth was 14.0% and transcontinental growth was 10.2% over the third quarter 2012. Revenue grew 12% with the effect of traffic mix, customer rate increases and fuel surcharges keeping revenue per load virtually flat compared to a year ago.
Operating income increased 21% over prior year. Benefits from steady demand, consistent load growth, improved box turns and lower office personnel compensation costs were partially offset by higher insurance and claims costs, higher costs to acquire and retain drivers, increased outsourced drayage costs, increased rail purchase transportation costs and higher fleet equipment costs. The current period ended with approximately 64,000 units of trailing capacity and 4,050 power units assigned to the dray fleet.
Dedicated Contract Services (DCS)
■ Third Quarter 2013 Segment Revenue: $319 million; up 17%
■ Third Quarter 2013 Operating Income: $29.3 million; up 14%
DCS revenue increased 17% during the current quarter. Productivity (revenue per truck per week) decreased by approximately 3% vs. 2012 due to the higher percentage of customer provided equipment and customer paid fuel primarily with respect to new large private fleet conversions. New accounts provided a net additional 972 revenue producing trucks by the end of the quarter compared to prior year.
Operating income increased by 14% from a year ago. The increase is primarily due to the increase in revenue from new accounts and partially offset by higher recruiting, relocation and personnel retention costs mostly within the new fleet conversions; higher purchased transportation costs and toll expenses, also mostly within the new fleet conversions; increased bad debt expense and increased equipment costs. While the implementation of the two new fleet conversions is complete, implementation costs incurred in the current quarter were approximately $2.5 million versus previous estimates of $1 million. A portion of this increased cost is expected to be ongoing until the fleets for these new accounts are operating in the manner in which they were designed with the customer.
Integrated Capacity Solutions (ICS)
■ Third Quarter 2013 Segment Revenue: $137 million; up 13%
■ Third Quarter 2013 Operating Income: $ 2.8 million; down 48%
ICS revenue increased 13% in the current quarter vs. the third quarter 2012, primarily due to a 4% increase in load volume and a higher revenue per load. Revenue grew faster than volumes primarily due to freight mix changes driven by customer demand. Truckload brokerage volume increased for the quarter but was partially offset by a decrease in less-than-truckload brokered loads compared to the third quarter 2012. Both transactional and contractual volumes continued to grow during the quarter. Contractual business was approximately 64% of total load volume in the current period and comparable to third quarter 2012.
Operating income decreased 48% over the same period 2012 primarily due to a decline in our gross profit margin and increased personnel cost. Gross profit margin decreased to 10.4% in the current quarter vs. 12.8% last year, primarily due to higher rates paid to qualified third party carriers. Personnel costs increased from the comparable period a year ago as we continue to on-board and train staff in order to expand our branch network over the next two years. Total branches at the end of the quarter grew to 22. ICS’s carrier base increased 8% and the employee count increased 14.5% vs. third quarter 2012.
Truck (JBT)
■ Third Quarter 2013 Segment Revenue: $97 million; down 17%
■ Third Quarter 2013 Operating Income: $ 0.6 million; down 84%
JBT revenue for the current quarter decreased 17% from the same period in 2012, primarily from an 18% reduction in fleet size and lower utilization per truck. Rates per mile, excluding fuel surcharge decreased 0.4% on a 6% shorter length of haul. The slightly positive rate impact from spot business was more than offset by a 1.7% decrease in rates from consistent shippers. At the end of the period, JBT operated 1,951 tractors compared to 2,381 a year ago.
Operating income decreased by 84% compared to third quarter 2012. Favorable changes from lowering the size of the trailer fleet, fewer empty miles and reductions in office headcount were more than offset by lower tractor utilization from both moderate customer demand and new hours of service regulations, increased driver hiring costs, increased driver and independent contractor mileage pay and higher maintenance cost per unit.
Cash Flow and Capitalization:
At September 30, 2013, we had a total of $687 million outstanding on various debt instruments compared to $645 million at September 30, 2012 and $685 million at December 31, 2012.
Our net capital expenditures for the nine months ended September 30, 2013 approximated $334 million compared to $279 million for the same period 2012. At September 30, 2013, we had cash and cash equivalents of $6 million.
We did not purchase any shares of our common stock during the quarter. At September 30, 2013 we had approximately $388 million remaining under our share repurchase authorization. Actual shares outstanding at September 30, 2013 approximated 117.9 million.
This press release may contain forward-looking statements, which are based on information currently available. Actual results may differ materially from those currently anticipated due to a number of factors, including, but not limited to, those discussed in Item 1A of our Annual Report filed on Form 10-K for the year ended December 31, 2012. We assume no obligation to update any forward-looking statement to the extent we become aware that it will not be achieved for any reason. This press release and additional information will be available immediately to interested parties on our web site, www.jbhunt.com.
J.B. HUNT TRANSPORT SERVICES, INC.
Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited)
|
Three Months Ended September 30 |
||||||||||||||||
|
2013 |
2012 |
|||||||||||||||
|
Amount |
% Of Revenue |
Amount |
% Of Revenue |
|||||||||||||
|
Operating revenues, excluding fuel surcharge revenues |
$ | 1,165,965 | $ | 1,046,769 | ||||||||||||
|
Fuel surcharge revenues |
269,885 | 249,023 | ||||||||||||||
|
Total operating revenues |
1,435,850 | 100.0% | 1,295,792 | 100.0% | ||||||||||||
|
Operating expenses |
||||||||||||||||
|
Rents and purchased transportation |
724,417 | 50.5% | 646,049 | 49.9% | ||||||||||||
|
Salaries, wages and employee benefits |
289,789 | 20.2% | 260,911 | 20.1% | ||||||||||||
|
Fuel and fuel taxes |
114,147 | 7.9% | 114,694 | 8.9% | ||||||||||||
|
Depreciation and amortization |
64,291 | 4.5% | 57,773 | 4.5% | ||||||||||||
|
Operating supplies and expenses |
55,378 | 3.9% | 48,281 | 3.7% | ||||||||||||
|
Insurance and claims |
13,878 | 1.0% | 13,745 | 1.1% | ||||||||||||
|
General and administrative expenses, net of asset dispositions |
10,172 | 0.6% | 9,369 | 0.6% | ||||||||||||
|
Operating taxes and licenses |
8,168 | 0.6% | 7,451 | 0.6% | ||||||||||||
|
Communication and utilities |
4,881 | 0.3% | 4,467 | 0.3% | ||||||||||||
|
Total operating expenses |
1,285,121 | 89.5% | 1,162,740 | 89.7% | ||||||||||||
|
Operating income |
150,729 | 10.5% | 133,052 | 10.3% | ||||||||||||
|
Net interest expense |
5,835 | 0.4% | 6,346 | 0.5% | ||||||||||||
|
Earnings before income taxes |
144,894 | 10.1% | 126,706 | 9.8% | ||||||||||||
|
Income taxes |
55,422 | 3.9% | 48,465 | 3.8% | ||||||||||||
|
Net earnings |
$ | 89,472 | 6.2% | $ | 78,241 | 6.0% | ||||||||||
|
Average diluted shares outstanding |
119,357 | 120,281 | ||||||||||||||
|
Diluted earnings per share |
$ | 0.75 | $ | 0.65 | ||||||||||||
|
J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings | ||||||||
|
(in thousands, except per share data) (unaudited) |
|
Nine Months Ended September 30 |
||||||||||||||||
|
2013 |
2012 |
|||||||||||||||
|
Amount |
% Of Revenue |
Amount |
% Of Revenue |
|||||||||||||
|
Operating revenues, excluding fuel surcharge revenues |
$ | 3,325,070 | $ | 2,990,971 | ||||||||||||
|
Fuel surcharge revenues |
785,225 | 725,873 | ||||||||||||||
|
Total operating revenues |
4,110,295 | 100.0% | 3,716,844 | 100.0% | ||||||||||||
|
Operating expenses |
||||||||||||||||
|
Rents and purchased transportation |
2,062,745 | 50.2% | 1,818,890 | 48.9% | ||||||||||||
|
Salaries, wages and employee benefits |
835,765 | 20.3% | 766,820 | 20.6% | ||||||||||||
|
Fuel and fuel taxes |
340,987 | 8.3% | 348,332 | 9.4% | ||||||||||||
|
Depreciation and amortization |
187,304 | 4.6% | 170,120 | 4.6% | ||||||||||||
|
Operating supplies and expenses |
149,918 | 3.6% | 133,632 | 3.6% | ||||||||||||
|
Insurance and claims |
38,759 | 0.9% | 37,385 | 1.0% | ||||||||||||
|
General and administrative expenses, net of asset dispositions |
33,581 | 0.9% | 19,718 | 0.5% | ||||||||||||
|
Operating taxes and licenses |
23,723 | 0.6% | 21,916 | 0.6% | ||||||||||||
|
Communication and utilities |
14,338 | 0.3% | 13,166 | 0.4% | ||||||||||||
|
Total operating expenses |
3,687,120 | 89.7% | 3,329,979 | 89.6% | ||||||||||||
|
Operating income |
423,175 | 10.3% | 386,865 | 10.4% | ||||||||||||
|
Net interest expense |
18,320 | 0.4% | 20,263 | 0.5% | ||||||||||||
|
Earnings before income taxes |
404,855 | 9.9% | 366,602 | 9.9% | ||||||||||||
|
Income taxes |
154,337 | 3.8% | 140,225 | 3.8% | ||||||||||||
|
Net earnings |
$ | 250,518 | 6.1% | $ | 226,377 | 6.1% | ||||||||||
|
Average diluted shares outstanding |
119,552 | 120,022 | ||||||||||||||
|
Diluted earnings per share |
$ | 2.10 | $ | 1.89 | ||||||||||||
|
Financial Information By Segment | ||||||||
|
(in thousands) (unaudited) |
|
Three Months Ended September 30 |
||||||||||||||||
|
2013 |
2012 |
|||||||||||||||
|
Amount |
% Of Total |
Amount |
% Of Total |
|||||||||||||
|
Revenue |
||||||||||||||||
|
Intermodal |
$ | 890,099 | 62% | $ | 793,759 | 62% | ||||||||||
|
Dedicated |
318,951 | 22% | 272,624 | 21% | ||||||||||||
|
Integrated Capacity Solutions |
137,405 | 10% | 121,268 | 9% | ||||||||||||
|
Truck |
96,861 | 7% | 116,699 | 9% | ||||||||||||
|
Subtotal |
1,443,316 | 101% | 1,304,350 | 101% | ||||||||||||
|
Intersegment eliminations |
(7,466 | ) | (1%) | (8,558 | ) | (1%) | ||||||||||
|
Consolidated revenue |
$ | 1,435,850 | 100% | $ | 1,295,792 | 100% | ||||||||||
|
Operating income |
||||||||||||||||
|
Intermodal |
$ | 118,034 | 78% | $ | 97,943 | 74% | ||||||||||
|
Dedicated |
29,254 | 19% | 25,592 | 19% | ||||||||||||
|
Integrated Capacity Solutions |
2,839 | 2% | 5,496 | 4% | ||||||||||||
|
Truck |
648 | 1% | 4,006 | 3% | ||||||||||||
|
Other (1) |
(46 | ) | (0%) | 15 | 0% | |||||||||||
|
Operating income |
$ | 150,729 | 100% | $ | 133,052 | 100% | ||||||||||
|
Nine Months Ended September 30 |
||||||||||||||||
|
2013 |
2012 |
|||||||||||||||
|
Amount |
% Of Total |
Amount |
% Of Total |
|||||||||||||
|
Revenue |
||||||||||||||||
|
Intermodal |
$ | 2,541,093 | 62% | $ | 2,249,918 | 61% | ||||||||||
|
Dedicated |
900,658 | 22% | 795,786 | 21% | ||||||||||||
|
Integrated Capacity Solutions |
391,551 | 10% | 327,814 | 9% | ||||||||||||
|
Truck |
299,873 | 7% | 371,035 | 10% | ||||||||||||
|
Subtotal |
4,133,175 | 101% | 3,744,553 | 101% | ||||||||||||
|
Intersegment eliminations |
(22,880 | ) | (1%) | (27,709 | ) | (1%) | ||||||||||
|
Consolidated revenue |
$ | 4,110,295 | 100% | $ | 3,716,844 | 100% | ||||||||||
|
Operating income |
||||||||||||||||
|
Intermodal |
$ | 325,507 | 77% | $ | 270,742 | 70% | ||||||||||
|
Dedicated |
80,905 | 19% | 86,939 | 22% | ||||||||||||
|
Integrated Capacity Solutions |
12,174 | 3% | 11,516 | 3% | ||||||||||||
|
Truck |
4,699 | 1% | 17,731 | 5% | ||||||||||||
|
Other (1) |
(110 | ) | (0%) | (63 | ) | (0%) | ||||||||||
|
Operating income |
$ | 423,175 | 100% | $ | 386,865 | 100% | ||||||||||
(1) Includes corporate support activity
|
Operating Statistics by Segment | ||||||||
|
(unaudited) |
|
Three Months Ended September 30 |
||||||||
|
2013 |
2012 |
|||||||
|
Intermodal |
||||||||
|
Loads |
411,548 | 368,709 | ||||||
|
Average length of haul |
1,693 | 1,697 | ||||||
|
Revenue per load |
$ | 2,163 | $ | 2,153 | ||||
|
Average tractors during the period * |
4,033 | 3,522 | ||||||
|
Tractors (end of period) |
||||||||
|
Company-owned |
3,452 | 3,134 | ||||||
|
Independent contractor |
598 | 413 | ||||||
|
Total tractors |
4,050 | 3,547 | ||||||
|
Net change in trailing equipment during the period |
2,009 | 1,901 | ||||||
|
Trailing equipment (end of period) |
63,920 | 57,913 | ||||||
|
Average effective trailing equipment usage |
62,448 | 56,088 | ||||||
|
Dedicated |
||||||||
|
Loads |
485,994 | 395,912 | ||||||
|
Average length of haul |
190 | 198 | ||||||
|
Revenue per truck per week** |
$ | 4,023 | $ | 4,146 | ||||
|
Average trucks during the period*** |
6,099 | 5,153 | ||||||
|
Trucks (end of period) |
||||||||
|
Company-owned |
5,606 | 4,819 | ||||||
|
Independent contractor |
10 | 15 | ||||||
|
Customer-owned (Dedicated operated) |
600 | 410 | ||||||
|
Total trucks |
6,216 | 5,244 | ||||||
|
Trailing equipment (end of period) |
18,355 | 13,176 | ||||||
|
Average effective trailing equipment usage |
19,828 | 14,555 | ||||||
|
Integrated Capacity Solutions |
||||||||
|
Loads |
93,880 | 90,009 | ||||||
|
Revenue per load |
$ | 1,464 | $ | 1,347 | ||||
|
Gross profit margin |
10.4 | % | 12.8 | % | ||||
|
Employee count (end of period) |
490 | 428 | ||||||
|
Approximate number of third-party carriers (end of period) |
34,000 | 31,400 | ||||||
|
Truck |
||||||||
|
Loads |
95,302 | 109,268 | ||||||
|
Average length of haul |
434 | 462 | ||||||
|
Loaded miles (000) |
41,151 | 49,885 | ||||||
|
Total miles (000) |
47,969 | 58,313 | ||||||
|
Average nonpaid empty miles per load |
74.5 | 77.4 | ||||||
|
Revenue per tractor per week** |
$ | 3,758 | $ | 3,783 | ||||
|
Average tractors during the period * |
1,989 | 2,406 | ||||||
|
Tractors (end of period) |
||||||||
|
Company-owned |
1,193 | 1,425 | ||||||
|
Independent contractor |
758 | 956 | ||||||
|
Total tractors |
1,951 | 2,381 | ||||||
|
Trailers (end of period) |
7,698 | 9,095 | ||||||
|
Average effective trailing equipment usage |
6,744 | 7,982 | ||||||
* Includes company-owned and independent contractor tractors
** Using weighted workdays
*** Includes company-owned, independent contractor, and customer-owned trucks
|
Operating Statistics by Segment | ||||||||
|
(unaudited) |
|
Nine Months Ended September 30 |
||||||||
|
2013 |
2012 |
|||||||
|
Intermodal |
||||||||
|
Loads |
1,177,910 | 1,047,641 | ||||||
|
Average length of haul |
1,691 | 1,696 | ||||||
|
Revenue per load |
$ | 2,157 | $ | 2,148 | ||||
|
Average tractors during the period * |
3,860 | 3,362 | ||||||
|
Tractors (end of period) |
||||||||
|
Company-owned |
3,452 | 3,134 | ||||||
|
Independent contractor |
598 | 413 | ||||||
|
Total tractors |
4,050 | 3,547 | ||||||
|
Net change in trailing equipment during the period |
4,958 | 3,407 | ||||||
|
Trailing equipment (end of period) |
63,920 | 57,913 | ||||||
|
Average effective trailing equipment usage |
59,511 | 53,578 | ||||||
|
Dedicated |
||||||||
|
Loads |
1,331,134 | 1,114,939 | ||||||
|
Average length of haul |
195 | 203 | ||||||
|
Revenue per truck per week** |
$ | 4,079 | $ | 4,145 | ||||
|
Average trucks during the period*** |
5,729 | 4,978 | ||||||
|
Trucks (end of period) |
||||||||
|
Company-owned |
5,606 | 4,819 | ||||||
|
Independent contractor |
10 | 15 | ||||||
|
Customer-owned (Dedicated operated) |
600 | 410 | ||||||
|
Total trucks |
6,216 | 5,244 | ||||||
|
Trailing equipment (end of period) |
18,355 | 13,176 | ||||||
|
Average effective trailing equipment usage |
18,939 | 13,615 | ||||||
|
Integrated Capacity Solutions |
||||||||
|
Loads |
289,543 | 232,259 | ||||||
|
Revenue per load |
$ | 1,352 | $ | 1,411 | ||||
|
Gross profit margin |
11.7 | % | 12.5 | % | ||||
|
Employee count (end of period) |
490 | 428 | ||||||
|
Approximate number of third-party carriers (end of period) |
34,000 | 31,400 | ||||||
|
Truck |
||||||||
|
Loads |
297,212 | 344,672 | ||||||
|
Average length of haul |
430 | 472 | ||||||
|
Loaded miles (000) |
126,914 | 160,987 | ||||||
|
Total miles (000) |
148,624 | 187,024 | ||||||
|
Average nonpaid empty miles per load |
74.0 | 75.8 | ||||||
|
Revenue per tractor per week** |
$ | 3,835 | $ | 3,866 | ||||
|
Average tractors during the period* |
2,035 | 2,494 | ||||||
|
Tractors (end of period) |
||||||||
|
Company-owned |
1,193 | 1,425 | ||||||
|
Independent contractor |
758 | 956 | ||||||
|
Total tractors |
1,951 | 2,381 | ||||||
|
Trailers (end of period) |
7,698 | 9,095 | ||||||
|
Average effective trailing equipment usage |
7,132 | 8,072 | ||||||
* Includes company-owned and independent contractor tractors
** Using weighted workdays
*** Includes company-owned, independent contractor, and customer-owned trucks
J.B. HUNT TRANSPORT SERVICES, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
|
September 30, 2013 |
December 31, 2012 |
|||||||
|
ASSETS |
||||||||
|
Current assets: |
||||||||
|
Cash and cash equivalents |
$ | 5,968 | $ | 5,589 | ||||
|
Accounts Receivable |
584,914 | 466,011 | ||||||
|
Prepaid expenses and other |
57,150 | 82,932 | ||||||
|
Total current assets |
648,032 | 554,532 | ||||||
|
Property and equipment |
3,150,319 | 2,904,706 | ||||||
|
Less accumulated depreciation |
1,112,933 | 1,019,232 | ||||||
|
Net property and equipment |
2,037,386 | 1,885,474 | ||||||
|
Other assets |
27,016 | 24,635 | ||||||
| $ | 2,712,434 | $ | 2,464,641 | |||||
|
LIABILITIES & STOCKHOLDERS' EQUITY |
||||||||
|
Current liabilities: |
||||||||
|
Current debt |
$ | 250,000 | $ | 100,000 | ||||
|
Trade accounts payable |
304,799 | 266,722 | ||||||
|
Claims accruals |
61,823 | 47,442 | ||||||
|
Accrued payroll |
61,173 | 70,647 | ||||||
|
Other accrued expenses |
11,793 | 17,199 | ||||||
|
Deferred income taxes |
750 | 750 | ||||||
|
Total current liabilities |
690,338 | 502,760 | ||||||
|
Long-term debt |
437,474 | 585,347 | ||||||
|
Other long-term liabilities |
56,723 | 53,050 | ||||||
|
Deferred income taxes |
547,422 | 531,624 | ||||||
|
Stockholders' equity |
980,477 | 791,860 | ||||||
| $ | 2,712,434 | $ | 2,464,641 | |||||
Supplemental Data
(unaudited)
|
September 30, 2013 |
December 31, 2012 |
|||||||
|
Actual shares outstanding at end of period (000) |
117,856 | 117,529 | ||||||
|
Book value per actual share outstanding at end of period |
$ | 8.32 | $ | 6.74 | ||||
|
Nine Months Ended September 30 |
||||||||
|
2013 |
2012 |
|||||||
|
Net cash provided by operating activities (000) |
$ | 411,228 | $ | 417,339 | ||||
|
Net capital expenditures (000) |
$ | 333,624 | $ | 279,037 | ||||