Hub Group, Inc. Reports Record First Quarter 2012 Earnings

DOWNERS GROVE, Ill., April 19, 2012 /PRNewswire/ -- Hub Group, Inc. (NASDAQ: HUBG) today announced financial results for the quarter ended March 31, 2012.

Hub Group reported record income of $13.7 million for the first quarter ended March 31, 2012, an increase of 30% compared to the first quarter of 2011.  Hub Group's diluted earnings per share was $0.37 for the first quarter of 2012, which represents an increase of 32% when compared with the prior year period.   

Hub Group's first quarter 2011 pre-tax income included approximately $1.7 million of costs related to the Mode Transportation acquisition.  Excluding the effects of these costs, non-GAAP earnings per share was $0.31 for the 2011 first quarter (see table below).  Earnings per share increased 19% when compared with the non-GAAP earnings per share in the prior year period. 

The Hub segment's revenue increased 16% to $563 million.  First quarter intermodal revenue increased 20% to $404 million.  The increase was attributable to a 15% volume increase and a 5% increase for fuel, price and mix.  Truck brokerage revenue decreased 6% to $80 million this quarter.  First quarter Unyson Logistics revenue increased 23% to $79 million.  The Hub segment's operating income was $20.0 million

The Mode segment's revenue was $187 million for the first quarter.  Operating income was $2.6 million

Hub Group ended the quarter with $53 million in cash.

CONFERENCE CALL

Hub Group will hold a conference call at 5:00 p.m. Eastern Time on Thursday, April 19, 2012 to discuss its first quarter results.

Hosting the conference call will be David P. Yeager, Chairman and Chief Executive Officer and Terri A. Pizzuto, Executive Vice-President, Chief Financial Officer and Treasurer.

This call is being webcast and can be accessed through the Investors link on Hub Group's Web site at www.hubgroup.com .  Those interested in participating in the question and answer session should follow the telephone dial-in instructions below.

To participate in the conference call by telephone, please call ten minutes early by dialing (888) 679-8038.  The conference call participant code is 89653878. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=P7696KW7K .  Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference, bypassing the operator.  The call will be limited to 60 minutes, including questions and answers.

An audio replay will be available through the Investors link on the Company's Web site at www.hubgroup.com. This replay will be available for 30 days.

ABOUT HUB GROUP: Hub Group, Inc. is a leading asset-light freight transportation management company providing comprehensive intermodal, truck brokerage and logistics services. The Company operates through a network of offices and independent agents throughout the United States, Canada and Mexico.

CERTAIN FORWARD-LOOKING STATEMENTS: Statements in this press release that are not historical, including statements about Hub Group's or management's earnings guidance, intentions, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently uncertain and subject to risks. Such statements should be viewed with caution. Actual results or experience could differ materially from the forward-looking statements as a result of many factors. Factors that could cause actual results to differ materially include the factors listed from time to time in Hub Group's SEC reports including, but not limited to, the annual report on Form 10-K for the year ended December 31, 2011.  Hub Group assumes no liability to update any such forward-looking statements.

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)




















Three Months









Ended March 31,









2012


2011

Revenue





$ 739,885


$ 485,379












Transportation costs





656,143


428,072


Gross margin





83,742


57,307












Costs and expenses:









Salaries and benefits





33,299


26,801


Agent fees and commissions




13,695


751


General and administrative




12,577


12,059


Depreciation and amortization




1,660


936



Total costs and expenses




61,231


40,547












Operating income





22,511


16,760












Other income (expense):








Interest expense





(307)


(14)


Interest and dividend income




34


32


Other, net 





(23)


209



Total other (expense) income 




(296)


227












Income before provision for income taxes




22,215


16,987












Provision for income taxes




8,553


6,489












Net income





$  13,662


$  10,498












Basic earnings per common share




$      0.37


$      0.28












Diluted earnings per common share




$      0.37


$      0.28












Basic weighted average number of shares outstanding



37,043


36,886

Diluted weighted average number of shares outstanding

37,143


 

37,022


 

HUB GROUP, INC.

FINANCIAL INFORMATION BY SEGMENT

(in thousands)






















Three Months








Ended March 31, 2012








Hub


Mode


Inter-Segment Elims


Hub Group Consolidated

Revenue




$ 563,212


$ 187,183


$                (10,510)


$      739,885















Transportation costs




501,694


164,959


(10,510)


656,143


Gross margin




61,518


22,224


-


83,742















Costs and expenses:












Salaries and benefits




29,080


4,219


-


33,299


Agent fees and commissions



634


13,061


-


13,695


General and administrative



10,732


1,845


-


12,577


Depreciation and amortization



1,121


539


-


1,660



Total costs and expenses



41,567


19,664


-


61,231















Operating income




19,951


2,560


-


22,511

 

HUB GROUP, INC.

UNAUDITED NON-GAAP TO GAAP RECONCILIATION

(earnings per share)















Three Months




Ended, March 31,






Change

Change




2012

2011

$

%









Diluted GAAP EPS


$  0.37

$  0.28

$  0.09

32%
















Mode acquisition-related costs


$     -

$  0.03

$ (0.03)










Diluted NON-GAAP EPS (adjusted)


$  0.37

$  0.31

$  0.06

19%























Diluted Shares


37,143

37,022




In accordance with U.S. generally accepted accounting principles (GAAP), reported earnings per share include the after-tax impact of the items identifiable in this table. For internal purposes, Hub excludes these items from results when evaluating operating performance. This table and Hub's internal use of non-GAAP earnings per share are not intended to imply, and should not be interpreted as implying, that non-GAAP earnings per share is a better measure of performance than GAAP earnings per share.

HUB GROUP, INC.

UNAUDITED CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)































March 31,


December 31,









2012


2011









(Unaudited)



ASSETS








CURRENT ASSETS:







Cash and cash equivalents

$      52,695


$         49,091



Accounts receivable trade, net

346,854


326,537



Accounts receivable other

17,601


23,878



Prepaid taxes



149


2,392



Deferred taxes



3,795


4,838



Prepaid expenses and other current assets

6,850


9,056





TOTAL CURRENT ASSETS

427,944


415,792













Restricted investments


15,832


14,323


Property and equipment, net

133,484


124,587


Other intangibles, net


21,238


21,667


Goodwill, net



263,415


263,470


Other assets



2,399


2,845






TOTAL ASSETS


$    864,312


$       842,684























LIABILITIES AND STOCKHOLDERS' EQUITY





CURRENT LIABILITIES:







Accounts payable trade


$    209,849


$       204,693



Accounts payable other


20,511


17,289



Current portion of capital leases

2,249


2,237



Accrued payroll



11,204


16,721



Accrued other



32,251


29,962





TOTAL CURRENT LIABILITIES

276,064


270,902













Non-current liabilities


18,861


17,717


Non-current portion of capital leases

22,862


23,436


Deferred taxes



94,018


91,764













STOCKHOLDERS' EQUITY:







Preferred stock, $.01 par value; 2,000,000 shares authorized;







no shares issued or outstanding in 2012 and 2011

-


-



Common stock









Class A: $.01 par value; 97,337,700 shares authorized and








41,224,792 shares issued in 2012 and 2011; 37,100,852 shares








outstanding in 2012 and 36,860,260 shares outstanding in 2011

412


412




Class B:  $.01 par value; 662,300 shares authorized;








662,296 shares issued and outstanding in 2012 and 2011

7


7



Additional paid-in capital


162,723


168,800



Purchase price in excess of predecessor basis, net of tax






 benefit of $10,306


(15,458)


(15,458)



Retained earnings


414,850


401,188



Other comprehensive income

5


4



Treasury stock; at cost, 4,123,940 shares in 2012







and 4,364,532 shares in 2011

(110,032)


(116,088)




TOTAL STOCKHOLDERS' EQUITY

452,507


438,865





     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$    864,312


$       842,684

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)






















Three Months Ended










March 31,










2012


2011

























Cash flows from operating activities:






Net income




$ 13,662


$   10,498


Adjustments to reconcile net income







to net cash provided by operating activities:








Depreciation and amortization 


5,516


2,629




Deferred taxes



3,352


1,266




Compensation expense related to share-based compensation plans

1,637


1,225




Loss (gain) on sale of assets


1


(13)




Excess tax benefits from share-based compensation


(83)


-


Changes in operating assets and liabilities, net of effects of acquisition:







Restricted investments



(1,509)


(707)




Accounts receivable, net


(14,043)


(23,411)




Prepaid taxes



2,243


173




Prepaid expenses and other current assets


2,205


1,738




Other assets




445


31




Accounts payable



8,377


32,229




Accrued expenses



22


(560)




Non-current liabilities



1,010


407






Net cash provided by operating activities


22,835


25,505













Cash flows from investing activities:






Proceeds from sale of equipment


52


68


Purchases of property and equipment


(17,013)


(4,880)


Cash used in acquisitions, net of cash acquired


(150)


(55)





Net cash used in investing activities


(17,111)


(4,867)













Cash flows from financing activities:






Proceeds from stock options exercised


16


24


Purchase of treasury stock



(1,665)


(1,447)


Capital lease payments



(546)


-


Excess tax benefits from share-based compensation


74


540





Net cash used in financing activities


(2,121)


(883)


























Effect of exchange rate changes on cash and cash equivalents


1


4













Net increase in cash and cash equivalents


3,604


19,759

Cash and cash equivalents beginning of period


49,091


115,144

Cash and cash equivalents end of period


$ 52,695


$ 134,903

SOURCE Hub Group, Inc.



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