Landstar System Reports 17 Percent Increase in Revenue and a 26 Percent Increase in Diluted Earnings Per Share
JACKSONVILLE, Fla., April 14, 2010 /PRNewswire via COMTEX/ --Landstar System, Inc. (Nasdaq: LSTR) reported a 17 percent increase in revenue to $548.1 million in the 2010 first quarter, up from $469.2 million in the 2009 first quarter. Net income for the 2010 first quarter was $17.2 million, or $0.34 per diluted share, compared to $13.9 million, or $0.27 per diluted share for the 2009 first quarter.
Revenue hauled by third-party truck capacity providers in the 2010 first quarter was $505.9 million, or 92 percent of revenue, compared to $426.3 million, or 91 percent of revenue, in the 2009 first quarter. Included in revenue hauled by third-party truck capacity providers in the 2010 and 2009 first quarters were $19.0 million and $9.8 million, respectively, of fuel surcharges invoiced to customers on revenue hauled by third-party truck brokerage carriers. In the 2010 and 2009 first quarters, the Company also invoiced customers $41.3 million and $24.2 million, respectively, of fuel surcharges that were passed 100 percent to third-party BCO Independent Contractors and excluded from revenue. Revenue hauled by rail, air and ocean cargo carriers was $28.5 million, or 5 percent of revenue, in the 2010 first quarter compared to $33.6 million, or 7 percent of revenue, in the 2009 first quarter. Transportation management fee revenue was $5.1 million, or 1 percent of revenue, in the 2010 first quarter.
Landstar System, Inc. also announced that its Board of Directors has declared a quarterly dividend of $0.045 per share. The dividend is payable on May 28, 2010 to stockholders of record at the close of business on May 6, 2010. It is the intention of the Board of Directors to continue to pay a quarterly dividend. During the 2010 first quarter, Landstar purchased 120,171 shares of its common stock at a total cost of $4.5 million. Under the Company's authorized share purchase program, the Company currently has a total of 1,255,000 shares of its common stock available for purchase.
Commenting on Landstar's 2010 first quarter, Landstar's Chairman, President and CEO, Henry Gerkens said, "I am very pleased with the Company's start to 2010. Revenue increased 17 percent over the 2009 first quarter. This marked the first time since the 2008 third quarter where revenue in the current quarter increased over the corresponding prior year quarter. The increased revenue was primarily the result of an 18 percent increase in the number of loads hauled, which was partly offset by a lower revenue per load amount of approximately 2 percent, compared to the 2009 first quarter. The number of loads hauled by third-party truck capacity providers in the month of March of 2010 was the highest number of loads hauled by third-party truck capacity providers in March of any year in Landstar's history. Also in March 2010, the Company experienced the first month over prior year month increase in revenue per load on freight hauled by third-party truck capacity providers since 2008.
Gerkens continued, "Diluted earnings per share in the 2010 first quarter compared to the 2009 first quarter increased 26 percent and operating income increased 19 percent quarter over quarter."
"The freight environment continues to improve. Recent trends in March, and thus far in April, indicate that both the revenue per load and the number of loads hauled remain strong compared to the corresponding prior year periods. I expect these trends to continue throughout the 2010 second quarter. As such, I would anticipate second quarter 2010 revenue over second quarter 2009 revenue to increase in the upper teens to low twenty percent range. I would also anticipate Landstar's earnings for the 2010 second quarter to be within a range of $0.44 to $0.49 per diluted share. Our longer term goals continue to be achieving a cumulative average revenue growth rate over a three to five year period in a mid-teen range, to increase annual operating margins and to grow diluted earnings per share at a slightly higher rate than the rate of revenue increase."
Landstar will provide a live webcast of its quarterly earnings conference call this afternoon at 5 pm ET. To access the webcast, visit the Company's website at www.landstar.com; click on "Investor Relations" and "Webcasts," then click on "Landstar's First 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 Landstar's 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 Landstar's 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.
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 9001:2000 quality management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market(R) under the symbol LSTR.
Landstar System, Inc. and Subsidiary
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)
Thirteen Weeks Ended
--------------------
March 27, March 28,
2010 2009
---- ----
Revenue $548,088 $469,247
Investment income 285 425
Costs and expenses:
Purchased transportation 417,201 351,324
Commissions to agents 40,408 38,324
Other operating costs 7,536 7,450
Insurance and claims 12,298 9,002
Selling, general and
administrative 36,843 34,369
Depreciation and amortization 5,792 5,485
----- -----
Total costs
and expenses 520,078 445,954
Operating income 28,295 23,718
Interest and debt expense 854 1,163
--- -----
Income before income taxes 27,441 22,555
Income taxes 10,484 8,661
Net income 16,957 13,894
Less: Net loss attributable to
noncontrolling interest (219) --
Net income attributable to
Landstar System, Inc. and
subsidiary $17,176 $13,894
Earnings per common share
attributable to Landstar
System, Inc. and subsidiary $0.34 $0.27
Diluted earnings per share
attributable to Landstar
System, Inc. and subsidiary $0.34 $0.27
Average number of shares
outstanding:
Earnings per common share 50,207,000 51,575,000
========== ==========
Diluted earnings per share 50,318,000 51,782,000
========== ==========
Dividends paid per common share $0.0450 $0.0400
======= =======
Landstar System, Inc. and Subsidiary
Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
(Unaudited)
March 27, Dec. 26,
2010 2009
---- ----
ASSETS
Current assets:
Cash and cash equivalents $82,493 $85,719
Short-term investments 24,391 24,325
Trade accounts receivable, less
allowance of $5,399 and $5,547 290,785 278,854
Other receivables, including advances to
independent contractors, less allowance
of $5,954 and $5,797 28,073 18,149
Deferred income taxes and other current
assets 13,890 19,565
------ ------
Total current assets 439,632 426,612
------- -------
Operating property, less accumulated
depreciation and amortization of
$129,949 and $124,810 140,188 116,656
Goodwill 57,470 57,470
Other assets 49,068 48,054
Total assets $686,358 $648,792
======== ========
LIABILITIES AND EQUITY
Current liabilities:
Cash overdraft $23,291 $28,919
Accounts payable 133,505 121,030
Current maturities of long-term debt 25,562 24,585
Insurance claims 38,194 41,627
Other current liabilities 50,011 42,474
------ ------
Total current liabilities 270,563 258,635
------- -------
Long-term debt, excluding current
maturities 82,641 68,313
Insurance claims 30,931 30,680
Deferred income taxes 22,345 23,013
Equity
Landstar System, Inc. and subsidiary
shareholders' equity
Common stock, $0.01 par value,
authorized 160,000,000 shares, issued
66,281,824 and 66,255,358 shares 663 663
Additional paid-in capital 162,614 161,261
Retained earnings 780,954 766,040
Cost of 16,142,282 and 16,022,111 shares
of common stock in treasury (664,953) (660,446)
Accumulated other comprehensive income 684 498
--- ---
Total Landstar System, Inc. and
subsidiary shareholders' equity 279,962 268,016
Noncontrolling interest (84) 135
--- ---
Total equity 279,878 268,151
------- -------
Total liabilities and equity $686,358 $648,792
======== ========
Landstar System, Inc. and Subsidiary
Supplemental Information
(Unaudited)
Thirteen Weeks Ended
--------------------
March 27, March 28,
2010 2009
---- ----
Revenue generated through (in
thousands):
-----------------------------
Business Capacity Owners (1) $286,141 $262,065
Truck Brokerage Carriers 219,755 164,243
Rail intermodal 14,776 19,318
Ocean cargo carriers 9,135 8,851
Air cargo carriers 4,603 5,387
Other (2) 13,678 9,383
$548,088 $469,247
======== ========
Number of loads:
----------------
Business Capacity Owners (1) 197,750 170,650
Truck Brokerage Carriers 149,350 117,650
Rail intermodal 6,870 9,580
Ocean cargo carriers 1,460 1,240
Air cargo carriers 1,500 3,260
356,930 302,380
======= =======
Revenue per load:
-----------------
Business Capacity Owners (1) $1,447 $1,536
Truck Brokerage Carriers 1,471 1,396
Rail intermodal 2,151 2,016
Ocean cargo carriers 6,257 7,138
Air cargo carriers 3,069 1,652
March 27, March 28,
2010 2009
---- ----
Truck Capacity
--------------
Business Capacity Owners (1)
(3) 7,800 8,424
-----
Truck Brokerage Carriers:
Approved and active (4) 15,644 14,877
Approved 9,674 10,682
-----
25,318 25,559
------ ------
Total available truck
capacity providers 33,118 33,983
======
Agent Locations 1,372 1,445
--------------- ===== =====
(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 8,384 and 9,013
at March 27, 2010 and March 28, 2009, respectively.
(4) Active refers to Truck Brokerage Carriers who have moved at least
one load in the past 180 days.
SOURCE Landstar System, Inc.