MRTN - Marten Transport Announces Third Quarter Results

October, 17 2019 04:01 PM Marten Transport Ltd.

MONDOVI, Wis., Oct. 17, 2019 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported the highest operating revenue and operating income for any quarter in its history, with the previous record for each set in this year’s second quarter. For the third quarter ended September 30, 2019, net income improved 8.7% to $16.6 million, or 30 cents per diluted share, from $15.3 million, or 28 cents per diluted share, for the third quarter of 2018. For the first nine months of 2019, net income improved 15.4% to $45.3 million, or 82 cents per diluted share, from $39.3 million, or 71 cents per diluted share, for the first nine months of 2018. Earnings for the 2019 quarter include an additional income tax benefit of $1.4 million, or 2.5 cents per diluted share, while the 2018 quarter’s earnings include an additional income tax benefit of $493,000, or one cent per diluted share, net of related operating expenses.






Operating Results Comparison







Net income and diluted earnings per common share used to calculate the TTM percentage change below exclude a $56.5 million deferred income tax benefit in the fourth quarter of 2017.









Percentage

Percentage

Percentage




Change

Change

Change




Three Months

Nine Months

Trailing Twelve




Ended

Ended

Months Ended




September 30,

September 30,

September 30,




2019 vs. 2018

2019 vs. 2018

2019 vs. 2018














Operating revenue

7.7
%

7.3
%

8.3
%














Operating income

5.5
%

13.6
%

18.6
%














Net income

8.7
%

15.4
%

27.5
%














Diluted earnings per common share

8.8
%

15.5
%

27.6
%

Operating revenue improved 7.7% to a record $215.0 million for the third quarter of 2019 from $199.6 million for the third quarter of 2018, and improved 7.3% to $626.1 million for the first nine months of 2019 from $583.6 million for the first nine months of 2018. For the trailing twelve months ended September 30, 2019, operating revenue improved 8.3% to $830.0 million from $766.4 million for the similar period ended September 30, 2018. Excluding fuel surcharges, operating revenue improved 10.0% to $188.9 million for the 2019 quarter from $171.8 million for the 2018 quarter, and improved 8.9% to $549.7 million for the first nine months of 2019 from $504.9 million for the first nine months of 2018. Fuel surcharge revenue decreased to $26.1 million for the 2019 quarter from $27.9 million for the 2018 quarter, and decreased to $76.4 million for the first nine months of 2019 from $78.8 million for the first nine months of 2018.

Operating income improved 5.5% to a record $20.0 million for the third quarter of 2019 from $19.0 million for the third quarter of 2018, and improved 13.6% to $57.7 million for the first nine months of 2019 from $50.8 million for the first nine months of 2018. For the trailing twelve months ended September 30, 2019, operating income improved 18.6% to $77.2 million from $65.1 million for the similar period ended September 30, 2018.

Operating expenses as a percentage of operating revenue were 90.7% for the third quarter of 2019, compared with 90.5% for the third quarter of 2018. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 89.4% for the 2019 quarter, compared with 88.9% for the 2018 quarter.

Operating expenses as a percentage of operating revenue improved to 90.8% for the first nine months of 2019 from 91.3% for the first nine months of 2018. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 89.5% from 89.9%.

Operating expenses as a percentage of operating revenue improved to 90.7% for the trailing twelve months ended September 30, 2019 from 91.5% for the similar period ended September 30, 2018. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 89.4% from 90.3%.

Chairman and Chief Executive Officer Randolph L. Marten said, “We earned the highest operating revenue and operating income for any quarter in our history, exceeding the previous record for each we produced in this year’s second quarter. Our talented people consistently deliver this profitable growth through the disciplined execution of our unique multifaceted business model across our diverse customer base - and overcame the negative impact of the recent hurricane and flooding on our Southeast and Texas operations during the third quarter. We added 43 Truckload and 41 Dedicated tractors this quarter, increasing our year-to-date growth to 149 Truckload and 230 Dedicated tractors, a combined 14.2% fleet growth since the beginning of the year. We expect to continue expanding our capacity to service our customers by offering the best jobs for the industry’s best drivers.”

Marten Transport, with headquarters in Mondovi, Wis., is a multifaceted business offering a network of truck-based transportation capabilities across the Company’s five distinct business platforms - Truckload, Dedicated, Intermodal, Brokerage and MRTN de Mexico. Marten is one of the leading temperature-sensitive truckload carriers in the United States, specializing in transporting and distributing food and other consumer packaged goods that require a temperature-controlled or insulated environment. Marten’s dry freight services are expanding, with 1,718 dry vans operating as of September 30, 2019. The Company offers service in the United States, Canada and Mexico, concentrating on expedited movements for high-volume customers. Marten’s common stock is traded on the Nasdaq Global Select Market under the symbol MRTN.

This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include a discussion of the Company’s prospects for future growth and by their nature involve substantial risks and uncertainties, and actual results may differ materially from those expressed in such forward-looking statements. Important factors known to the Company that could cause actual results to differ materially from those discussed in the forward-looking statements are discussed in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise.

CONTACTS: Tim Kohl, President, and Jim Hinnendael, Executive Vice President and Chief Financial Officer, of Marten Transport, Ltd., 715-926-4216.

MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS



September 30,


December 31,

(In thousands, except share information)

2019


2018



(Unaudited)





ASSETS








Current assets:








Cash and cash equivalents

$
40,480


$
56,763

Receivables:








Trade, net


85,149



83,033

Other


3,694



3,808

Prepaid expenses and other


18,576



19,924

Total current assets


147,899



163,528










Property and equipment:








Revenue equipment, buildings and land, office equipment and other


891,326



816,430

Accumulated depreciation


(261,474
)


(228,200
)
Net property and equipment


629,852



588,230

Other noncurrent assets


3,204



2,146

Total assets

$
780,955


$
753,904










LIABILITIES AND STOCKHOLDERS’ EQUITY








Current liabilities:








Accounts payable

$
27,777


$
15,704

Insurance and claims accruals


30,647



28,103

Accrued and other current liabilities


26,506



28,166

Total current liabilities


84,930



71,973

Deferred income taxes


112,454



105,977

Noncurrent operating lease liabilities


714



-

Total liabilities


198,098



177,950










Stockholders’ equity:








Preferred stock, $.01 par value per share; 2,000,000 shares authorized; no shares issued and outstanding


-



-

Common stock, $.01 par value per share; 192,000,000 shares authorized; 54,687,065 shares at September 30, 2019, and 54,466,691 shares at December 31, 2018, issued and outstanding


547



545

Additional paid-in capital


78,840



76,814

Retained earnings


503,470



498,595

Total stockholders’ equity


582,857



575,954

Total liabilities and stockholders’ equity

$
780,955


$
753,904

MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)



Three Months


Nine Months



Ended September 30,


Ended September 30,

(In thousands, except per share information)

2019


2018


2019


2018


















Operating revenue

$
214,973


$
199,649


$
626,086


$
583,633


















Operating expenses (income):
















Salaries, wages and benefits


69,312



64,051



201,449



186,123

Purchased transportation


40,435



35,867



117,352



105,941

Fuel and fuel taxes


31,275



31,658



89,904



92,444

Supplies and maintenance


12,116



10,574



34,739



31,261

Depreciation


24,290



22,272



70,295



66,280

Operating taxes and licenses


2,651



2,404



7,422



7,055

Insurance and claims


9,618



8,567



29,355



27,798

Communications and utilities


1,901



1,663



5,801



4,993

Gain on disposition of revenue equipment


(2,559
)


(1,835
)


(5,337
)


(5,206
)
Other


5,900



5,435



17,395



16,134


















Total operating expenses


194,939



180,656



568,375



532,823


















Operating income


20,034



18,993



57,711



50,810


















Other


(255
)


(120
)


(928
)


(447
)

















Income before income taxes


20,289



19,113



58,639



51,257


















Income taxes expense


3,702



3,856



13,316



11,967


















Net income

$
16,587


$
15,257


$
45,323


$
39,290


















Basic earnings per common share

$
0.30


$
0.28


$
0.83


$
0.72


















Diluted earnings per common share

$
0.30


$
0.28


$
0.82


$
0.71


















Dividends declared per common share

$
0.68


$
0.025


$
0.74


$
0.075

MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)











Dollar


Percentage











Change


Change



Three Months


Three Months


Three Months



Ended


Ended


Ended



September 30,


September 30,


September 30,

(Dollars in thousands)

2019


2018


2019 vs. 2018


2019 vs. 2018

Operating revenue:
















Truckload revenue, net of fuel surcharge revenue

$
82,931


$
80,563


$
2,368



2.9
%
Truckload fuel surcharge revenue


12,056



13,357



(1,301
)


(9.7
)
Total Truckload revenue


94,987



93,920



1,067



1.1


















Dedicated revenue, net of fuel surcharge revenue


59,281



48,500



10,781



22.2

Dedicated fuel surcharge revenue


11,053



10,291



762



7.4

Total Dedicated revenue


70,334



58,791



11,543



19.6


















Intermodal revenue, net of fuel surcharge revenue


19,336



21,735



(2,399
)


(11.0
)
Intermodal fuel surcharge revenue


2,961



4,204



(1,243
)


(29.6
)
Total Intermodal revenue


22,297



25,939



(3,642
)


(14.0
)

















Brokerage revenue


27,355



20,999



6,356



30.3


















Total operating revenue

$
214,973


$
199,649


$
15,324



7.7
%

















Operating income:
















Truckload

$
6,956


$
10,026


$
(3,070
)


(30.6
)%
Dedicated


9,920



5,249



4,671



89.0

Intermodal


1,210



2,507



(1,297
)


(51.7
)
Brokerage


1,948



1,211



737



60.9

Total operating income

$
20,034


$
18,993


$
1,041



5.5
%

















Operating ratio:
















Truckload


92.7
%


89.3
%








Dedicated


85.9



91.1









Intermodal


94.6



90.3









Brokerage


92.9



94.2









Consolidated operating ratio


90.7
%


90.5
%

MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)











Dollar


Percentage











Change


Change



Nine Months


Nine Months


Nine Months



Ended


Ended


Ended



September 30,


September 30,


September 30,

(Dollars in thousands)

2019


2018


2019 vs. 2018


2019 vs. 2018

Operating revenue:
















Truckload revenue, net of fuel surcharge revenue

$
246,313


$
241,304


$
5,009



2.1
%
Truckload fuel surcharge revenue


36,418



40,037



(3,619
)


(9.0
)
Total Truckload revenue


282,731



281,341



1,390



0.5


















Dedicated revenue, net of fuel surcharge revenue


164,365



138,096



26,269



19.0

Dedicated fuel surcharge revenue


30,704



26,499



4,205



15.9

Total Dedicated revenue


195,069



164,595



30,474



18.5


















Intermodal revenue, net of fuel surcharge revenue


56,618



63,834



(7,216
)


(11.3
)
Intermodal fuel surcharge revenue


9,253



12,227



(2,974
)


(24.3
)
Total Intermodal revenue


65,871



76,061



(10,190
)


(13.4
)

















Brokerage revenue


82,415



61,636



20,779



33.7


















Total operating revenue

$
626,086


$
583,633


$
42,453



7.3
%

















Operating income:
















Truckload

$
22,556


$
25,530


$
(2,974
)


(11.6
)%
Dedicated


23,135



13,321



9,814



73.7

Intermodal


5,140



7,997



(2,857
)


(35.7
)
Brokerage


6,880



3,962



2,918



73.6

Total operating income

$
57,711


$
50,810


$
6,901



13.6
%

















Operating ratio:
















Truckload


92.0
%


90.9
%








Dedicated


88.1



91.9









Intermodal


92.2



89.5









Brokerage


91.7



93.6









Consolidated operating ratio


90.8
%


91.3
%

MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)



Three Months


Nine Months



Ended September 30,


Ended September 30,



2019


2018


2019


2018

Truckload Segment:
















Revenue (in thousands)

$
94,987


$
93,920


$
282,731


$
281,341

Average revenue, net of fuel surcharges, per tractor per week⁽¹⁾

$
3,723


$
3,925


$
3,818


$
3,797

Average tractors⁽¹⁾


1,695



1,561



1,654



1,629

Average miles per trip


545



564



545



578

Non-revenue miles percentage⁽²⁾


11.8
%


10.4
%


11.4
%


8.9
%
Total miles (in thousands)


39,326



37,259



115,639



117,343


















Dedicated Segment:
















Revenue (in thousands)

$
70,334


$
58,791


$
195,069


$
164,595

Average revenue, net of fuel surcharges, per tractor per week⁽¹⁾

$
3,392


$
3,287


$
3,412


$
3,279

Average tractors⁽¹⁾


1,329



1,123



1,235



1,080

Average miles per trip


312



317



316



305

Non-revenue miles percentage⁽²⁾


0.7
%


0.6
%


0.7
%


0.8
%
Total miles (in thousands)


28,859



24,362



79,700



69,244


















Intermodal Segment:
















Revenue (in thousands)

$
22,297


$
25,939


$
65,871


$
76,061

Loads


8,897



10,573



26,578



31,932

Average tractors


87



89



85



87


















Brokerage Segment:
















Revenue (in thousands)

$
27,355


$
20,999


$
82,415


$
61,636

Loads


16,059



12,781



47,510



36,790


















At September 30, 2019 and September 30, 2018:
















Total tractors⁽¹⁾


3,137



2,751









Average age of company tractors (in years)


1.8



1.6









Total trailers


5,562



5,397









Average age of company trailers (in years)


2.6



2.6









Ratio of trailers to tractors⁽¹⁾


1.8



2.0



Three Months


Nine Months



Ended September 30,


Ended September 30,

(In thousands)

2019


2018


2019


2018


















Net cash provided by operating activities

$
46,101


$
44,722


$
119,610


$
112,097

Net cash (used for) investing activities


(51,900
)


(29,665
)


(96,078
)


(88,842
)
Net cash (used for) financing activities


(36,513
)


(1,321
)


(39,815
)


(3,307
)

















Weighted average shares outstanding:
















Basic


54,655



54,661



54,608



54,615

Diluted


55,134



55,194



55,078



55,151

(1)

Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 75 and 50 tractors as of September 30, 2019 and 2018, respectively.

(2)

Represents the percentage of miles for which the company is not compensated.

Company Name:	Marten Transport Ltd.
Stock Symbol:	MRTN
Market:	NASDAQ
Website:	marten.com

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