2014

Hub Group, Inc. Reports Third Quarter 2011 Earnings

DOWNERS GROVE, Ill., Oct. 24, 2011 /PRNewswire/ -- Hub Group, Inc. (NASDAQ: HUBG) today announced financial results for the quarter ended September 30, 2011.

Hub Group reported income of $16.3 million for the third quarter ended September 30, 2011, an increase of 29% compared to the third quarter of 2010.  Hub Group's diluted earnings per share was $0.44 for the third quarter of 2011, which represents an increase of 29% when compared with the prior year period.    

The Hub segment's revenue increased 17% to $561 million.  Third quarter intermodal revenue increased 19% to $402 million.  The increase was attributable to a 10% volume increase and a 9% increase for fuel, price and mix.  Truck brokerage revenue decreased 3% to $83 million this quarter.  Third quarter Unyson Logistics revenue increased 39% to $76 million.  Hub's operating income increased $4.2 million, which represents an increase of 20% when compared with the prior year period.  The Hub results include approximately $335,000 of restructuring costs related to truck brokerage operations.

The Mode segment's revenue was $206 million for the third quarter.  Operating income was $1.7 million.  The Mode results include approximately $800,000 of costs related to integration.

Hub Group ended the quarter with $43 million in cash.

CONFERENCE CALL

Hub will hold a conference call at 5:00 p.m. Eastern Time on Monday, October 24, 2011 to discuss its third 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) 713-4211.  The conference call participant code is 96261580. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PH9K4Q4KR.  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, 2010 and the reports on Form 10-Q for the periods ended March 31, 2011 and June 30, 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


Nine Months


Ended September 30,


Ended September 30,








2011


2010


2011


2010

Revenue




$ 760,379


$ 478,417


$ 2,005,467


$ 1,353,824















Transportation costs




673,657


421,020


1,776,685


1,197,033


Gross margin




86,722


57,397


228,782


156,791















Costs and expenses:












Salaries and benefits




32,023


25,547


91,570


72,868


Agent fees and commissions



13,884


641


28,400


1,774


General and administrative




12,612


9,564


37,523


28,640


Depreciation and amortization



1,560


938


3,968


2,845



Total costs and expenses



60,079


36,690


161,461


106,127















Operating income




26,643


20,707


67,321


50,664















Other income (expense):












Interest expense




(236)


(12)


(319)


(38)


Interest and dividend income



41


35


118


83


Other, net




17


(68)


286


84



Total other (expense) income



(178)


(45)


85


129















Income before provision for income taxes



26,465


20,662


67,406


50,793















Provision for income taxes




10,189


8,045


26,242


19,844















Net income




$   16,276


$   12,617


$      41,164


$      30,949















Basic earnings per common share



$       0.44


$       0.34


$          1.12


$          0.83















Diluted earnings per common share



$       0.44


$       0.34


$          1.11


$          0.83















Basic weighted average number of shares outstanding



36,923


37,118


36,903


37,358

Diluted weighted average number of shares outstanding



37,065


37,288


37,049


37,504



HUB GROUP, INC.

FINANCIAL INFORMATION BY SEGMENT

(in thousands)
















Three Months


Ended September 30, 2011








Hub


Mode


Inter-Segment
Elims


Hub Group
Consolidated

Revenue




$ 560,810


$ 205,961


$            (6,392)


$        760,379















Transportation costs




497,204


182,845


(6,392)


673,657


Gross margin




63,606


23,116


-


86,722















Costs and expenses:












Salaries and benefits




26,884


5,139


-


32,023


Agent fees and commissions



660


13,224


-


13,884


General and administrative




10,141


2,471


-


12,612


Depreciation and amortization



1,003


557


-


1,560



Total costs and expenses



38,688


21,391


-


60,079















Operating income




24,918


1,725


-


26,643



HUB GROUP, INC.

FINANCIAL INFORMATION BY SEGMENT

(in thousands)























Nine Months









Ended September 30, 2011









Hub


Mode


Inter-Segment
Elims


Hub Group
Consolidated


Revenue




$ 1,606,607


$ 407,717


$           (8,857)


$   2,005,467

















Transportation costs




1,423,108


362,434


(8,857)


1,776,685



Gross margin




183,499


45,283


-


228,782

















Costs and expenses:













Salaries and benefits




81,796


9,774


-


91,570



Agent fees and commissions



2,049


26,351


-


28,400



General and administrative



32,464


5,059


-


37,523



Depreciation and amortization



2,890


1,078


-


3,968




Total costs and expenses



119,199


42,262


-


161,461

















Operating income




64,300


3,021


-


67,321



















HUB GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)































September 30,


December 31,









2011


2010









(Unaudited)



ASSETS








CURRENT ASSETS:







Cash and cash equivalents

$           42,652


$       115,144



Accounts receivable trade, net

343,579


185,879



Accounts receivable other

19,068


17,958



Prepaid taxes



128


296



Deferred taxes



7,421


3,314



Prepaid expenses and other current assets

9,603


6,569





TOTAL CURRENT ASSETS

422,451


329,160













Restricted investments


13,237


11,421


Property and equipment, net

110,055


47,806


Other intangibles, net


20,496


5,856


Goodwill, net



262,640


233,029


Other assets



2,406


2,135





TOTAL ASSETS


$         831,285


$       629,407























LIABILITIES AND STOCKHOLDERS' EQUITY





CURRENT LIABILITIES:







Accounts payable trade


$         210,993


$       121,078



Accounts payable other


17,209


10,064



Accrued payroll



18,535


14,378



Accrued other



37,824


21,898



Current portion of capital lease

2,219


-





TOTAL CURRENT LIABILITIES

286,780


167,418













Non-current liabilities


16,971


13,950


Deferred taxes



82,728


71,739


Non-current portion of capital lease

24,038


-













STOCKHOLDERS' EQUITY:







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







no shares issued or outstanding in 2011 and 2010

-


-



Common stock









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








41,224,792 shares issued in 2011 and 2010; 36,855,343 shares








outstanding in 2011 and 36,638,359 shares outstanding in 2010

412


412




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








662,296 shares issued and outstanding in 2011 and 2010

7


7



Additional paid-in capital


167,846


169,722



Purchase price in excess of predecessor basis, net of tax






benefit of $10,306


(15,458)


(15,458)



Retained earnings


384,174


343,010



Other comprehensive income

1


6



Treasury stock; at cost, 4,369,449 shares in 2011







and 4,586,433 shares in 2010

(116,214)


(121,399)




TOTAL STOCKHOLDERS' EQUITY

420,768


376,300





    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$         831,285


$       629,407




































HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)






















Nine Months Ended










September 30,










2011


2010

























Cash flows from operating activities:






Net income




$  41,164


$   30,949


Adjustments to reconcile net income







to net cash provided by operating activities:








Depreciation and amortization


10,944


6,078




Deferred taxes



7,189


7,325




Compensation expense related to share-based compensation plans

3,675


2,720




(Gain) loss on sale of assets


(16)


46


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







Restricted investments



362


(938)




Accounts receivable, net


(57,275)


(66,443)




Prepaid taxes



167


464




Prepaid expenses and other current assets


(2,275)


517




Other assets




406


(491)




Accounts payable



29,316


39,692




Accrued expenses



12,881


6,497




Non-current liabilities



(344)


847





Net cash provided by operating activities


46,194


27,263













Cash flows from investing activities:






Proceeds from sale of equipment


316


871


Purchases of property and equipment


(35,382)


(13,362)


Cash used in acquisitions, net of cash acquired


(83,057)


-





Net cash used in investing activities


(118,123)


(12,491)













Cash flows from financing activities:






Proceeds from stock options exercised


78


18


Purchase of treasury stock



(1,513)


(23,822)


Capital lease payments



(185)


-


Excess tax benefits from share-based compensation


1,069


198





Net cash used in financing activities


(551)


(23,606)


























Effect of exchange rate changes on cash and cash equivalents


(12)


14













Net decrease in cash and cash equivalents


(72,492)


(8,820)

Cash and cash equivalents beginning of period


115,144


126,863

Cash and cash equivalents end of period


$  42,652


$ 118,043























































































SOURCE Hub Group, Inc.



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