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8-K - FORM 8-K - LANDSTAR SYSTEM INC | g25880e8vk.htm |
Exhibit 99.1
For Immediate Release | Contact: Jim Gattoni | |
Landstar System, Inc. | ||
www.landstar.com | ||
February 1, 2011 | 904-398-9400 |
LANDSTAR SYSTEM REPORTS 35 PERCENT INCREASE IN
FOURTH QUARTER EARNINGS PER SHARE
FOURTH QUARTER EARNINGS PER SHARE
Jacksonville, FL Landstar System, Inc. (NASDAQ: LSTR) reported 2010 fourth quarter net income of
$24.1 million, or $0.50 per diluted share, compared to net income of $18.6 million, or $0.37 per
diluted share, for the 2009 fourth quarter. Revenue for the 2010 fourth quarter was $587.5 million
compared to $547.7 million in the 2009 fourth quarter.
Truck transportation revenue hauled by independent business capacity owners (BCOs) and truck
brokerage carriers in the 2010 fourth quarter was $537.6 million, or 91 percent of revenue,
compared to $498.4 million, or 91 percent of revenue, in the 2009 fourth quarter. In the 2010 and
2009 fourth quarters, the Company invoiced customers $51.1 million and $40.7 million, respectively,
of fuel surcharges that were passed 100 percent to BCOs and excluded from revenue. Revenue hauled
by rail, air and ocean cargo carriers was $36.7 million, or 6 percent of revenue, in the 2010
fourth quarter compared to $35.0 million, or 6 percent of revenue, in the 2009 fourth quarter.
Transportation management fee revenue generated by the supply chain solutions companies was $4.4
million, or 1 percent of revenue, in both the 2010 and 2009 fourth quarters.
LANDSTAR SYSTEM/2
Commenting on Landstars 2010 fourth quarter, Henry Gerkens, Landstars Chairman, President and CEO
said, I am very pleased with the way the Company finished the year. Operating income and diluted
earnings per share in the 2010 fourth quarter increased 30 percent and 35 percent, respectively,
over the 2009 fourth quarter. Gross profit, defined as revenue less the cost of purchased transportation and commissions to agents, in
the 2010 fourth quarter increased 8 percent over the 2009 fourth quarter. As anticipated, revenue
in the 2010 fourth quarter compared to revenue in the 2009 fourth quarter was negatively impacted
by a significant decrease in the number of loads hauled under the Companys less-than-truckload
substitute line haul service offering. Revenue under the Companys less-than-truckload substitute
line haul service offering decreased to 4 percent of revenue in the 2010 fourth quarter compared to
13 percent of revenue in the 2009 fourth quarter. Excluding the impact of the revenue decline in
this service offering, the total number of truck transportation loads hauled in the 2010 fourth
quarter increased 8 percent over the 2009 fourth quarter and revenue per load for truck
transportation for the fourth quarter of 2010 increased 12 percent over the 2009 fourth quarter.
In addition, the number of loads hauled by air and ocean carriers in the 2010 fourth quarter
increased 50 percent and 31 percent, respectively, over the 2009 fourth quarter.
Landstar continues to generate outstanding returns. Return on average shareholders equity
was 32 percent and return on invested capital, net income divided by the sum of average equity plus
average debt, was 22 percent. Landstar System, Inc. also announced that its Board of Directors has
declared a quarterly dividend of $0.05 per share. The dividend is payable on March 11, 2011 to
stockholders of record at the close of business on February 14, 2011. It is the intention of the
Board of Directors to continue to pay a quarterly dividend. During the 2010 fourth quarter,
Landstar purchased 1,277,000 shares of its common stock at a total cost of $48.1 million. During
2010, the Company purchased 2,653,000 shares of its common stock at a total cost of $102.7 million.
Under the Companys authorized share purchase program, the Company currently has a total of
723,000 shares of its common stock available for purchase.
Gerkens continued, As reported by FIRST CALL, the current ranges of analysts earnings estimates
for the 2011 first quarter and full year are $0.38 to $0.45 per diluted share and $1.95 to $2.29
per diluted share. Based upon current revenue trends and the
anticipated continuation of those trends through
the balance of the year, I am comfortable with the
current range of analysts earnings estimates for both the 2011 first quarter and full year.
LANDSTAR SYSTEM/3
Landstar will provide a live webcast of its quarterly earnings conference call this afternoon at
2:00 pm ET. To access the webcast, visit the Companys website at www.landstar.com; click on
Investor Relations and Webcasts, then click on Landstars Fourth Quarter 2010 Earnings Release
Conference Call.
The following is a safe harbor statement under the Private Securities Litigation Reform Act of
1995. Statements contained in this press release that are not based on historical facts are
forward-looking statements. This press release contains forward-looking statements, such as
statements which relate to Landstars business objectives, plans, strategies, expectations and
intentions. Terms such as anticipates, believes, estimates, intention, plans,
predicts, may, should, will, the negative thereof and similar expressions are intended to
identify forward-looking statements. Such statements are by nature subject to uncertainties and
risks, including but not limited to: an increase in the frequency or severity of accidents or
workers compensation claims; unfavorable development of existing claims; dependence on independent
sales agents; dependence on third-party capacity providers; disruptions or failures in our computer
systems; a downturn in domestic or international economic growth or growth in the transportation
sector; substantial industry competition; and other operational, financial or legal risks or
uncertainties detailed in Landstars Form 10K for the 2009 fiscal year, described in Item 1A Risk
Factors, and other SEC filings from time-to-time. These risks and uncertainties could cause actual
results or events to differ materially from historical results or those anticipated. Investors
should not place undue reliance on such forward-looking statements, and Landstar undertakes no
obligation to publicly update or revise any forward-looking statements.
LANDSTAR SYSTEM/4
About Landstar:
Landstar System, Inc. is a non-asset based provider of integrated supply chain solutions. Landstar delivers safe, specialized transportation, warehousing and logistics services to a broad range of customers worldwide utilizing a network of agents, third-party capacity owners and employees. All Landstar transportation companies are certified to ISO 9001:2008 quality management system standards and RC14001:2008 environmental, health, safety and security management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market® under the symbol LSTR.
Landstar System, Inc. is a non-asset based provider of integrated supply chain solutions. Landstar delivers safe, specialized transportation, warehousing and logistics services to a broad range of customers worldwide utilizing a network of agents, third-party capacity owners and employees. All Landstar transportation companies are certified to ISO 9001:2008 quality management system standards and RC14001:2008 environmental, health, safety and security management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market® under the symbol LSTR.
(Tables follow)
LANDSTAR SYSTEM/5
Landstar System, Inc. and Subsidiary
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)
Fiscal Year Ended | Thirteen Weeks Ended | |||||||||||||||
December 25, | December 26, | December 25, | December 26, | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Revenue |
$ | 2,400,170 | $ | 2,008,796 | $ | 587,535 | $ | 547,715 | ||||||||
Investment income |
1,558 | 1,268 | 489 | 314 | ||||||||||||
Costs and expenses: |
||||||||||||||||
Purchased transportation |
1,824,308 | 1,503,520 | 442,353 | 413,301 | ||||||||||||
Commissions to agents |
181,405 | 160,571 | 46,710 | 42,836 | ||||||||||||
Other operating costs |
28,826 | 29,173 | 6,874 | 7,424 | ||||||||||||
Insurance and claims |
49,334 | 45,918 | 11,725 | 16,862 | ||||||||||||
Selling, general and administrative |
153,080 | 133,612 | 38,194 | 33,922 | ||||||||||||
Depreciation and amortization |
24,804 | 23,528 | 6,360 | 6,114 | ||||||||||||
Total costs and expenses |
2,261,757 | 1,896,322 | 552,216 | 520,459 | ||||||||||||
Operating income |
139,971 | 113,742 | 35,808 | 27,570 | ||||||||||||
Interest and debt expense |
3,623 | 4,030 | 924 | 937 | ||||||||||||
Income before income taxes |
136,348 | 109,712 | 34,884 | 26,633 | ||||||||||||
Income taxes |
49,766 | 39,762 | 11,005 | 8,296 | ||||||||||||
Net income |
86,582 | 69,950 | 23,879 | 18,337 | ||||||||||||
Less: Net loss attributable to
noncontrolling interest |
(932 | ) | (445 | ) | (220 | ) | (231 | ) | ||||||||
Net income attributable to Landstar System,
Inc. and subsidiary |
$ | 87,514 | $ | 70,395 | $ | 24,099 | $ | 18,568 | ||||||||
Earnings per common share attributable to
Landstar System, Inc. and subsidiary |
$ | 1.77 | $ | 1.38 | $ | 0.50 | $ | 0.37 | ||||||||
Diluted earnings per share attributable to
Landstar System, Inc. and subsidiary |
$ | 1.77 | $ | 1.37 | $ | 0.50 | $ | 0.37 | ||||||||
Average number of shares outstanding: |
||||||||||||||||
Earnings per common share |
49,523,000 | 51,095,000 | 48,327,000 | 50,404,000 | ||||||||||||
Diluted earnings per share |
49,580,000 | 51,280,000 | 48,358,000 | 50,594,000 | ||||||||||||
Dividends paid per common share |
$ | 0.1900 | $ | 0.1700 | $ | 0.0500 | $ | 0.0450 | ||||||||
LANDSTAR SYSTEM/6
Landstar System, Inc. and Subsidiary
Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
(Unaudited)
Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
(Unaudited)
Dec. 25, | Dec. 26, | |||||||
2010 | 2009 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 44,706 | $ | 85,719 | ||||
Short-term investments |
23,266 | 24,325 | ||||||
Trade accounts receivable, less allowance
of $5,324 and $5,547 |
307,350 | 278,854 | ||||||
Other receivables, including advances to independent
contractors, less allowance of $5,511 and $5,797 |
23,943 | 18,149 | ||||||
Deferred income taxes and other current assets |
21,652 | 19,565 | ||||||
Total current assets |
420,917 | 426,612 | ||||||
Operating property, less accumulated depreciation
and amortization of $137,830 and $124,810 |
132,649 | 116,656 | ||||||
Goodwill |
57,470 | 57,470 | ||||||
Other assets |
72,846 | 48,054 | ||||||
Total assets |
$ | 683,882 | $ | 648,792 | ||||
LIABILITIES AND EQUITY |
||||||||
Current liabilities: |
||||||||
Cash overdraft |
$ | 24,877 | $ | 28,919 | ||||
Accounts payable |
137,297 | 121,030 | ||||||
Current maturities of long-term debt |
22,172 | 24,585 | ||||||
Insurance claims |
40,215 | 41,627 | ||||||
Other current liabilities |
53,785 | 42,474 | ||||||
Total current liabilities |
278,346 | 258,635 | ||||||
Long-term debt, excluding current maturities |
99,439 | 68,313 | ||||||
Insurance claims |
31,468 | 30,680 | ||||||
Deferred income taxes |
23,662 | 23,013 | ||||||
Equity |
||||||||
Landstar System, Inc. and subsidiary shareholders equity Common stock, $0.01 par value, authorized 160,000,000 shares, issued 66,535,169 and 66,255,358 shares |
665 | 663 | ||||||
Additional paid-in capital |
169,268 | 161,261 | ||||||
Retained earnings |
844,132 | 766,040 | ||||||
Cost of 18,674,902 and 16,022,111 shares of common
stock in treasury |
(763,182 | ) | (660,446 | ) | ||||
Accumulated other comprehensive income |
881 | 498 | ||||||
Total Landstar System, Inc. and subsidiary shareholders
equity |
251,764 | 268,016 | ||||||
Noncontrolling interest |
(797 | ) | 135 | |||||
Total equity |
250,967 | 268,151 | ||||||
Total liabilities and equity |
$ | 683,882 | $ | 648,792 | ||||
LANDSTAR SYSTEM/7
Landstar System, Inc. and Subsidiary
Supplemental Information
(Unaudited)
Supplemental Information
(Unaudited)
Fiscal Year Ended | Thirteen Weeks Ended | |||||||||||||||
December 25, | December 26, | December 25, | December 26, | |||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Revenue generated through (in thousands): |
||||||||||||||||
Business Capacity Owners (1) |
$ | 1,289,395 | $ | 1,140,004 | $ | 323,174 | $ | 299,613 | ||||||||
Truck Brokerage Carriers |
919,605 | 694,467 | 214,416 | 198,806 | ||||||||||||
Rail intermodal |
70,299 | 76,346 | 18,459 | 19,252 | ||||||||||||
Ocean cargo carriers |
46,064 | 33,835 | 12,019 | 8,376 | ||||||||||||
Air cargo carriers |
20,104 | 17,621 | 6,251 | 7,362 | ||||||||||||
Other (2) |
54,703 | 46,523 | 13,216 | 14,306 | ||||||||||||
$ | 2,400,170 | $ | 2,008,796 | $ | 587,535 | $ | 547,715 | |||||||||
Number of loads: |
||||||||||||||||
Business Capacity Owners (1) |
821,330 | 761,940 | 197,060 | 200,100 | ||||||||||||
Truck Brokerage Carriers |
591,810 | 501,980 | 135,400 | 138,980 | ||||||||||||
Rail intermodal |
31,070 | 37,890 | 7,950 | 9,290 | ||||||||||||
Ocean cargo carriers |
6,830 | 5,370 | 1,900 | 1,450 | ||||||||||||
Air cargo carriers |
6,880 | 7,780 | 2,010 | 1,340 | ||||||||||||
1,457,920 | 1,314,960 | 344,320 | 351,160 | |||||||||||||
Revenue per load: |
||||||||||||||||
Business Capacity Owners (1) |
$ | 1,570 | $ | 1,496 | $ | 1,640 | $ | 1,497 | ||||||||
Truck Brokerage Carriers |
1,554 | 1,383 | 1,584 | 1,430 | ||||||||||||
Rail intermodal |
2,263 | 2,015 | 2,322 | 2,072 | ||||||||||||
Ocean cargo carriers |
6,744 | 6,301 | 6,326 | 5,777 | ||||||||||||
Air cargo carriers |
2,922 | 2,265 | 3,110 | 5,494 |
December 25, | December 26, | |||||||||||||||
2010 | 2009 | |||||||||||||||
Truck Capacity |
||||||||||||||||
Business Capacity Owners (1) (3) |
7,865 | 7,926 | ||||||||||||||
Truck Brokerage Carriers: |
||||||||||||||||
Approved and active (4) |
18,049 | 14,887 | ||||||||||||||
Approved |
9,938 | 9,886 | ||||||||||||||
27,987 | 24,773 | |||||||||||||||
Total available truck capacity providers |
35,852 | 32,699 | ||||||||||||||
Million Dollar Agents (5) |
468 | 405 | ||||||||||||||
(1) | Business Capacity Owners are independent contractors who provide truck capacity to the Company under exclusive lease arrangements. | |
(2) | Includes premium revenue generated by the insurance segment and warehousing and transportation management fee revenue generated by the transportation logistics segment. | |
(3) | Trucks provided by Business Capacity Owners were 8,452 and 8,519 at December 25, 2010 and December 26, 2009, respectively. | |
(4) | Active refers to Truck Brokerage Carriers who have moved at least one load in the past 180 days. | |
(5) | Independent commission sales agents who on an annual basis generate $1 million or more of Landstar revenue. |