Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - LANDSTAR SYSTEM INC | d650218d8k.htm |
| EX-99.1 - EX-99.1 - LANDSTAR SYSTEM INC | d650218dex991.htm |
| EX-99.2 - EX-99.2 - LANDSTAR SYSTEM INC | d650218dex992.htm |
| EX-99.3 - EX-99.3 - LANDSTAR SYSTEM INC | d650218dex993.htm |
Exhibit 99.4
Landstar System, Inc.
Pro Forma Condensed Consolidated Financial Statements
(Unaudited)
On December 28, 2013, Landstar System Holdings, Inc., a Delaware corporation (“LSHI”) and a direct, wholly owned subsidiary of Landstar System, Inc. (the “Company”), completed the sale of all of the issued and outstanding equity interests of Landstar Supply Chain Solutions, Inc., a Delaware corporation, to XPO Logistics, Inc. (the “Transaction”).
The unaudited pro forma condensed consolidated financial information of the Company presented on the following pages was derived from the Company’s historical consolidated financial statements and is being presented to give effect to the Transaction. The pro forma adjustments are based on information that is directly attributable to the Transaction. The unaudited pro forma condensed financial information should be read in conjunction with the historical financial information and related notes contained in the Company’s Annual Report on Form 10-K for the 2012 fiscal year and its Quarterly Reports on Form 10-Q for the first three quarters of its 2013 fiscal year.
Landstar System, Inc.
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(unaudited- pro forma information)
| 39 weeks ended September 28, 2013 | Fiscal Year Ended December 29, 2012 | |||||||||||||||||||||||
| Historical | Results of operations of business sold (d) |
Pro forma (c) | Historical | Results of operations of business sold (d) |
Pro forma (c) | |||||||||||||||||||
| Revenue |
$ | 1,988,182 | $ | 15,377 | $ | 1,972,805 | $ | 2,793,420 | $ | 22,621 | $ | 2,770,799 | ||||||||||||
| Investment income |
1,111 | 1,111 | 1,563 | 1,563 | ||||||||||||||||||||
| Costs and expenses |
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| Purchased transportation |
1,510,984 | (1,693 | ) | 1,512,677 | 2,129,345 | (978 | ) | 2,130,323 | ||||||||||||||||
| Commission to agents |
156,480 | 103 | 156,377 | 218,363 | 241 | 218,122 | ||||||||||||||||||
| Other operating costs |
15,557 | 161 | 15,396 | 22,949 | 367 | 22,582 | ||||||||||||||||||
| Insurance and claims |
37,040 | 133 | 36,907 | 37,451 | 162 | 37,289 | ||||||||||||||||||
| Selling, general and administrative |
105,220 | 10,253 | 94,967 | 153,566 | 15,472 | 138,094 | ||||||||||||||||||
| Depreciation and amortization |
22,833 | 2,090 | 20,743 | 27,456 | 2,243 | 25,213 | ||||||||||||||||||
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| Total costs and expenses |
1,848,114 | 11,047 | 1,837,067 | 2,589,130 | 17,507 | 2,571,623 | ||||||||||||||||||
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| Operating income |
141,179 | 4,330 | 136,849 | 205,853 | 5,114 | 200,739 | ||||||||||||||||||
| Interest and debt expense |
2,367 | — | 2,367 | 3,104 | (6 | ) | 3,110 | |||||||||||||||||
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| Income from continuing operations before income taxes |
138,812 | 4,330 | 134,482 | 202,749 | 5,120 | 197,629 | ||||||||||||||||||
| Income taxes |
52,360 | 1,624 | 50,736 | 72,968 | 1,905 | 71,063 | ||||||||||||||||||
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| Income from continuing operations |
$ | 86,452 | $ | 2,706 | $ | 83,746 | $ | 129,781 | $ | 3,215 | $ | 126,566 | ||||||||||||
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| EPS - Continuing operations |
$ | 1.87 | $ | 0.06 | $ | 1.81 | $ | 2.78 | $ | 0.07 | $ | 2.71 | ||||||||||||
| Diluted EPS - Continuing operations |
$ | 1.87 | $ | 0.06 | $ | 1.81 | $ | 2.77 | $ | 0.07 | $ | 2.70 | ||||||||||||
| Common shares |
46,156,000 | 46,156,000 | 46,156,000 | 46,698,000 | 46,698,000 | 46,698,000 | ||||||||||||||||||
| Diluted shares |
46,323,000 | 46,323,000 | 46,323,000 | 46,877,000 | 46,877,000 | 46,877,000 | ||||||||||||||||||
Landstar System, Inc.
Consolidated Balance Sheet
(Dollars in thousands except per share amount)
(unaudited- pro forma information)
| September 28, 2013 | ||||||||||||||||
| Historical | Assets sold on disposition (a) |
Assumed net proceeds on sale (b) |
Pro Forma (c) | |||||||||||||
| ASSETS |
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| Current Assets |
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| Cash and cash equivalents |
$ | 97,552 | $ | (11,639 | ) | $ | 87,000 | $ | 172,913 | |||||||
| Short-term investments |
34,568 | — | 34,568 | |||||||||||||
| Trade accounts receivable, net |
394,796 | (30,308 | ) | 364,488 | ||||||||||||
| Other receivables, net |
77,169 | (3 | ) | 77,166 | ||||||||||||
| Deferred income taxes and other current assets |
18,983 | (1,114 | ) | 17,869 | ||||||||||||
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| Total current assets |
623,068 | (43,064 | ) | 87,000 | 667,004 | |||||||||||
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| Operating property, less accumulated depreciation and amortization |
184,441 | (1,926 | ) | 182,515 | ||||||||||||
| Goodwill |
57,470 | (26,336 | ) | 31,134 | ||||||||||||
| Other assets |
85,953 | (4,362 | ) | 81,591 | ||||||||||||
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| Total assets |
950,932 | (75,688 | ) | 87,000 | 962,244 | |||||||||||
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| LIABILITIES AND SHAREHOLDERS’ EQUITY |
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| Current Liabilities |
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| Cash overdraft |
26,894 | (4,875 | ) | 22,019 | ||||||||||||
| Accounts payable |
194,134 | (36,973 | ) | 157,161 | ||||||||||||
| Current maturities of long-term debt |
27,347 | — | 27,347 | |||||||||||||
| Insurance claims |
89,877 | (9 | ) | 89,868 | ||||||||||||
| Other current liabilities |
32,922 | (1,206 | ) | 21,949 | 53,665 | |||||||||||
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| Total current liabilities |
371,174 | (43,063 | ) | 21,949 | 350,060 | |||||||||||
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| Long-term debt, excluding current maturities |
90,709 | — | 90,709 | |||||||||||||
| Insurance claims |
23,119 | (9 | ) | 23,110 | ||||||||||||
| Deferred income taxes and other noncurrent liabilities |
42,669 | — | 42,669 | |||||||||||||
| Shareholders’ Equity |
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| Common stock, $0.01 par value, authorized 160,000,000 shares, issued 67,013,297 shares |
670 | — | 670 | |||||||||||||
| Additional paid-in capital |
178,952 | — | 178,952 | |||||||||||||
| Retained earnings |
1,129,408 | (32,616 | ) | 65,051 | 1,161,843 | |||||||||||
| Cost of 21,296,347 shares of common stock in treasury |
(886,135 | ) | — | (886,135 | ) | |||||||||||
| Accumulated other comprehensive income |
366 | — | 366 | |||||||||||||
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| Total shareholders’ equity |
423,261 | (32,616 | ) | 65,051 | 455,696 | |||||||||||
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| Total liabilities and shareholders’ equity |
$ | 950,932 | $ | (75,688 | ) | $ | 87,000 | $ | 962,244 | |||||||
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Landstar System, Inc.
Notes to the Pro Forma Condensed Consolidated Financial Statements
(Unaudited)
Description of the Transaction and basis of presentation
The unaudited pro forma condensed consolidated balance sheet and consolidated statements of income of the Company are based upon the historical consolidated financial statements of the Company, which were included in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 28, 2013, and the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2012. The unaudited pro forma condensed consolidated statements of income include the results of operations from continuing operations and exclude discontinued operations resulting from the Transaction. The unaudited pro forma condensed consolidated statements of income for the 39 weeks ended September 28, 2013 and for the fiscal year ended December 29, 2012 reflect the Transaction as if it had occurred as of the beginning of the Company’s 2012 fiscal year. The unaudited pro forma condensed consolidated balance sheet at September 28, 2013 reflects the Transaction as if it had occurred on September 28, 2013, the last day of the Company’s 2013 third fiscal quarter.
Pro forma adjustments
| a) | Reflects the assets of LSCS as of September 28, 2013, adjusted for cash and intercompany amounts settled prior to consummation of the Transaction. Under the terms of the stock purchase agreement for the Transaction, previously filed as Exhibit 2.1 to the Company’s Form 8-K filed on December 12, 2013, working capital of LSCS at closing of the Transaction was set at $1 with the balance in excess over $1 being distributed in cash to the Company (subject to subsequent adjustment in accordance with the terms of the stock purchase agreement). |
| b) | Cash and cash equivalents include cash proceeds of $87.0 million. Other current liabilities include taxes payable in relation to the Transaction, net of a deferred tax asset of $0.8 million, plus an estimate of transaction costs incurred in connection with the Transaction. |
| c) | Reflects the removal of the results of operations of LSCS as a discontinued operation. |
| d) | Purchased transportation of the business sold represents intercompany cost of purchased transportation paid to LSCS by subsidiaries of the Company for capacity procurement services (previously eliminated for consolidated reporting purposes). These services are expected to continue to be provided by LSCS to subsidiaries of the Company, and therefore, the cost of purchased transportation related to these services is included in the Company’s pro forma condensed consolidated income statements. |