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| 8-K - 8-K - Roadrunner Transportation Systems, Inc. | rrts-20130630x8xkearningsr.htm |
FOR IMMEDIATE RELEASE
ROADRUNNER TRANSPORTATION SYSTEMS REPORTS
2013 SECOND QUARTER RESULTS AND ANNOUNCES
THIRD QUARTER 2013 GUIDANCE
Cudahy, WI - July 31, 2013 - Roadrunner Transportation Systems, Inc. (NYSE: RRTS), a leading asset-light transportation and logistics service provider, today reported financial results for the three and six months ended June 30, 2013.
Roadrunner's summary financial results for the three and six months ended June 30 are highlighted below. Second quarter 2013 net income available to common stockholders increased 37.0% over the prior year quarter to $14.0 million. Second quarter diluted income per share available to common stockholders increased 15.6% over the prior year to $0.37. Excluding acquisition transaction expenses of $0.3 million related to the second quarter acquisitions of Wando Trucking and Adrian Carriers, diluted income per share would have been $0.38.
The difference between Roadrunner's 37.0% increase in net income available to common stockholders for the three months ended June 30, 2013 and the 15.6% increase in diluted income per share available to common stockholders for the three months ended June 30, 2013 results from the December 2012 stock offering which increased the weighted averaged diluted shares outstanding by 3.9 million shares and impacted diluted income per share by $0.05.
Three Months Ended | Six Months Ended | |||||||||||||||
(In thousands, except per share data) | June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Total revenues | $ | 331,908 | $ | 262,546 | $ | 631,288 | $ | 499,119 | ||||||||
Net revenues (total revenues less purchased transportation costs) | $ | 103,986 | $ | 76,671 | $ | 197,024 | $ | 146,214 | ||||||||
Depreciation and amortization | 3,846 | 2,125 | 7,201 | 4,085 | ||||||||||||
Other operating expenses | 75,452 | 55,903 | 145,998 | 108,708 | ||||||||||||
Acquisition transaction expenses | 290 | 70 | 290 | 208 | ||||||||||||
Operating income | $ | 24,398 | $ | 18,573 | $ | 43,535 | $ | 33,213 | ||||||||
Net income available to common stockholders | 13,970 | 10,200 | 24,552 | 18,131 | ||||||||||||
Weighted average diluted shares outstanding | 37,307 | 32,186 | 36,442 | 32,182 | ||||||||||||
Diluted income per share available to common stockholders | $ | 0.37 | $ | 0.32 | $ | 0.67 | $ | 0.56 | ||||||||
2013 Second Quarter Results
In discussing the company's second quarter performance, Mark DiBlasi, President and CEO of Roadrunner, said,
“Strong performance across all of our business segments generated second quarter revenue growth of 26.4% and net revenue growth of 35.6%. Due to sales and operational initiatives, our operating income growth of 31.4% outpaced revenue. Our operating ratio improved 30 basis points to 92.6%, compared to 92.9% in the second quarter of 2012.
“Our LTL operating ratio remained the same quarter-over-quarter and improved sequentially to 91.9% in the second quarter of 2013 from 93.2% in the first quarter of 2013. Our continued initiatives to expand into new geographic regions, build density, improve pricing, and enhance productivity, as well as the addition of Expedited Freight Systems (EFS) in August 2012, resulted in a net revenue margin improvement from 25.8% in the second quarter of 2012 to 28.8% in the second quarter of 2013.
“Our continued performance initiatives led to our TL operating ratio improving to 93.0% in the second quarter of 2013 from 93.9% in the second quarter of 2012. TL revenues grew by $50.2 million, or 45.2%, from the prior year quarter. Incremental revenues from our 2012 and 2013 acquisitions accounted for $43.3 million of the increase, with the remaining $6.9 million representing organic growth of 6.2% from our existing business. The positive impact of the acquisitions and operating leverage associated with our revenue growth led to a 66.2% increase in our TL operating income quarter-over-quarter.
“TMS revenue grew $3.8 million, or 16.6%, in the second quarter of 2013 from the prior year quarter, primarily due to our 2013 acquisition of Adrian Carriers. This growth, along with a $0.7 million contingent purchase price adjustment, led to a 43.4% increase in TMS operating income quarter-over-quarter."
2013 Third Quarter Guidance
In commenting on guidance for the third quarter of 2013, Peter Armbruster, CFO of Roadrunner, said, “We anticipate our revenues for the third quarter to be in the range of $355 million to $380 million, representing an increase of 27% to 36% from the third quarter of 2012. We expect diluted income per share available to common stockholders to be between $0.36 and $0.39, compared to diluted income per share available to common stockholders of $0.31 in the prior year quarter. Our diluted per share guidance represents an increase of 16% to 26% from the third quarter of 2012 diluted income per share of $0.31. We expect net income available to common stockholders to be between $13.4 million and $14.6 million, representing an increase of 36% to 48% from the third quarter of 2012. Our guidance reflects weighted average diluted shares outstanding of 37.7 million.
2013 Second Quarter Segment Information
Roadrunner has three operating segments: less-than-truckload (LTL), truckload and logistics (TL), and transportation management solutions (TMS). The following highlights exclude intercompany eliminations and corporate expenses.
LTL revenues, including fuel, increased 13.0% to $146.5 million for the second quarter of 2013 from $129.7 million for the second quarter of 2012. LTL net revenues for the second quarter of 2013 were $42.3 million, or 28.8% of LTL revenues, compared to $33.4 million, or 25.8% of LTL revenues, for the second quarter of 2012. LTL operating income was $11.8 million, or 8.1% of LTL revenues, for the second quarter of 2013 compared to $10.5 million, or 8.1% of LTL revenues, for the second quarter of 2012.
Summary LTL operating statistics for the three and six months ended June 30 are shown below.
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||
2013 | 2012 | % Change | 2013 | 2012 | % Change | ||||||||||||||||
Operating ratio | 91.9 | 91.9 | 92.6 | 92.4 | |||||||||||||||||
Tonnage (in thousands of tons) | 404.3 | 338.2 | 19.5 | % | 774.3 | 654.3 | 18.3 | % | |||||||||||||
Shipments (in thousands) | 628.2 | 515.6 | 21.8 | % | 1,200.2 | 1,002.5 | 19.7 | % | |||||||||||||
Revenue per hundredweight (incl. fuel) | $ | 17.88 | $ | 18.91 | (5.4 | %) | $ | 17.90 | $ | 18.87 | (5.1 | )% | |||||||||
Revenue per hundredweight (excl. fuel) | $ | 14.69 | $ | 15.44 | (4.9 | %) | $ | 14.66 | $ | 15.40 | (4.8 | )% | |||||||||
Weight per shipment (lbs.) | 1,287 | 1,312 | (1.9 | %) | 1,290 | 1,305 | (1.1 | %) | |||||||||||||
Linehaul cost per mile (excl. fuel) | $ | 1.23 | $ | 1.24 | (0.8 | %) | $ | 1.23 | $ | 1.24 | (0.8 | )% | |||||||||
Note: Other than operating ratio, the statistics above do not include (i) adjustments for undelivered freight required for financial statement purposes in accordance with Roadrunner's revenue recognition policy; and (ii) non-LTL related business captured within the LTL segment. Operating statistics include EFS beginning as of the date of acquisition, August 10, 2012. | |||||||||||||||||||||
TL revenues increased 45.2% to $161.2 million for the second quarter of 2013 from $111.0 million for the second quarter of 2012. The improvement was primarily due to increases in market pricing and load growth, increased utilization of Roadrunner's TL brokerage agent network, and the acquisitions of D&E Transport, CTW Transport, R&M/Sortino, Central Cal, A&A, DCT, and Wando Trucking. For the second quarter, these acquisitions collectively contributed incremental TL revenues of $43.3 million. Overall, TL net revenues for the second quarter of 2013 were $52.3 million, or 32.4% of TL revenues, compared to $36.5 million, or 32.9% of TL revenues, for the second quarter of 2012. TL operating income was $11.4 million, or 7.0% of TL revenues, for the second quarter of 2013 compared to $6.8 million, or 6.1% of TL revenues, for the second quarter of 2012.
TMS revenues for the second quarter of 2013 increased 16.6% to $27.0 million from $23.1 million for the second quarter of 2012. TMS net revenues for the second quarter of 2013 were $9.5 million, or 35.0% of TMS revenues, compared to $6.7 million, or 29.1% of TMS revenues, for the second quarter of 2012. TMS operating income was $4.0 million for the second quarter of 2013, compared to $2.8 million for the second quarter of 2012.
Conference Call
A conference call is scheduled for Wednesday, July 31, 2013 at 4:30 p.m. Eastern Time. To access the conference call, please dial 866-318-8614 (U.S.) or 617-399-5133 (International) approximately 10 minutes prior to the start of the call. Callers will be prompted for passcode 42036242. The conference call will also be available via live webcast under the Investor Relations section of Roadrunner's website, www.rrts.com.
If you are unable to listen to the live call, a replay will be available through August 7, 2013, and can be accessed by dialing 888-286-8010 (U.S.) or 617-801-6888 (International). Callers will be prompted for passcode 61295245. An archived version of the webcast will also be available under the Investor Relations section of Roadrunner's website, www.rrts.com.
About Roadrunner Transportation Systems, Inc.
Roadrunner is a leading asset-light transportation and logistics service provider offering a full suite of solutions, including customized and expedited less-than-truckload, truckload and logistics, transportation management solutions, intermodal solutions, and domestic and international air. For more information, please visit Roadrunner's website, www.rrts.com.
Safe Harbor Statement
This release contains forward-looking statements that relate to future events or performance, including statements regarding Roadrunner's performance; Roadrunner's sales and operational initiatives; Roadrunner's initiatives to expand into new geographic regions, build density, improve pricing, and enhance productivity; the impact of Roadrunner's December 2012 stock offering; the impact of Roadrunner's acquisitions; and Roadrunner's expected revenues, diluted income per share available to common stockholders, net income available to common stockholders, and weighted average diluted shares outstanding for the third quarter of 2013. These statements reflect Roadrunner's current expectations, and Roadrunner does not undertake to update or revise these forward-looking statements, even if experience or future changes make it clear that any projected results expressed or implied in this or other company statements will not be realized. Furthermore, readers are cautioned that these statements involve risks and uncertainties, many of which are beyond Roadrunner's control, which could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties include, but are not limited to, risks related to the integration of acquired companies, competition in the transportation industry, the impact of the current economic environment, Roadrunner's dependence upon purchased power, the unpredictability of and potential fluctuation in the price and availability of fuel, the effects of governmental and environmental regulations, insurance in excess of prior experience levels, and other "Risk Factors" set forth in Roadrunner's most recent SEC filings.
(Tables Follow)
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Revenues | $ | 331,908 | $ | 262,546 | $ | 631,288 | $ | 499,119 | |||||||
Operating expenses: | |||||||||||||||
Purchased transportation costs | 227,922 | 185,875 | 434,264 | 352,905 | |||||||||||
Personnel and related benefits | 36,670 | 28,963 | 71,526 | 55,696 | |||||||||||
Other operating expenses | 38,782 | 26,940 | 74,472 | 53,012 | |||||||||||
Depreciation and amortization | 3,846 | 2,125 | 7,201 | 4,085 | |||||||||||
Acquisition transaction expenses | 290 | 70 | 290 | 208 | |||||||||||
Total operating expenses | 307,510 | 243,973 | 587,753 | 465,906 | |||||||||||
Operating income | 24,398 | 18,573 | 43,535 | 33,213 | |||||||||||
Interest expense: | |||||||||||||||
Interest on long-term debt | 1,610 | 2,071 | 3,485 | 3,869 | |||||||||||
Dividends on preferred stock subject to mandatory redemption | — | — | — | 49 | |||||||||||
Total interest expense | 1,610 | 2,071 | 3,485 | 3,918 | |||||||||||
Income before provision for income taxes | 22,788 | 16,502 | 40,050 | 29,295 | |||||||||||
Provision for income taxes | 8,818 | 6,302 | 15,498 | 11,164 | |||||||||||
Net income available to common stockholders | $ | 13,970 | $ | 10,200 | $ | 24,552 | $ | 18,131 | |||||||
Earnings per share available to common stockholders: | |||||||||||||||
Basic | $ | 0.39 | $ | 0.33 | $ | 0.70 | $ | 0.59 | |||||||
Diluted | $ | 0.37 | $ | 0.32 | $ | 0.67 | $ | 0.56 | |||||||
Weighted average common stock outstanding: | |||||||||||||||
Basic | 35,585 | 30,821 | 35,289 | 30,782 | |||||||||||
Diluted | 37,307 | 32,186 | 36,442 | 32,182 | |||||||||||
ROADRUNNER TRANSPORTATION SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
June 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 5,423 | $ | 11,908 | |||
Accounts receivable, net of allowances of $1,182 and $1,476, respectively | 152,752 | 122,947 | |||||
Deferred income taxes | 3,595 | 3,800 | |||||
Prepaid expenses and other current assets | 22,257 | 26,461 | |||||
Total current assets | 184,027 | 165,116 | |||||
Property and equipment, net of accumulated depreciation of $25,663 and $20,108, respectively | 93,176 | 68,576 | |||||
Other assets: | |||||||
Goodwill | 459,808 | 442,143 | |||||
Intangible assets, net | 14,374 | 12,710 | |||||
Other noncurrent assets | 10,363 | 12,263 | |||||
Total other assets | 484,545 | 467,116 | |||||
Total assets | $ | 761,748 | $ | 700,808 | |||
LIABILITIES AND STOCKHOLDERS’ INVESTMENT | |||||||
Current liabilities: | |||||||
Current maturities of long-term debt | $ | 17,000 | $ | 17,000 | |||
Accounts payable | 63,571 | 54,887 | |||||
Accrued expenses and other liabilities | 27,874 | 29,132 | |||||
Total current liabilities | 108,445 | 101,019 | |||||
Long-term debt, net of current maturities | 158,000 | 144,500 | |||||
Other long-term liabilities | 65,330 | 63,210 | |||||
Total liabilities | 331,775 | 308,729 | |||||
Stockholders’ investment: | |||||||
Common stock $.01 par value; 100,000 shares authorized; 35,838 and 34,371 shares issued and outstanding | 358 | 344 | |||||
Additional paid-in capital | 338,362 | 325,034 | |||||
Retained earnings | 91,253 | 66,701 | |||||
Total stockholders’ investment | 429,973 | 392,079 | |||||
Total liabilities and stockholders’ investment | $ | 761,748 | $ | 700,808 | |||
Contact
Roadrunner Transportation Systems, Inc.
Peter Armbruster
Chief Financial Officer
414-615-1648
Vollrath Associates, Inc.
Marilyn Vollrath
414-221-0210
ir@rrts.com