2014

Landstar System Reports 23 Percent Increase In Diluted Earnings Per Share To A Second Quarter Record Of $0.76

JACKSONVILLE, Fla., July 26, 2012 /PRNewswire/ -- Landstar System, Inc. (NASDAQ: LSTR) reported 2012 record second quarter diluted earnings per share of $0.76 from net income of $35.9 million, compared to net income of $29.6 million, or $0.62 per diluted share, for the 2011 second quarter.  Operating margin, representing operating income divided by gross profit (gross profit defined as revenue less the cost of purchased transportation and commissions to agents) was 50.4 percent in the 2012 second quarter compared to 43.6 percent in the 2011 second quarter.  Revenue for the 2012 second quarter was a second quarter record of $736.0 million compared to $675.6 million in the 2011 second quarter. 

Truck transportation revenue hauled by independent business capacity owners ("BCOs") and truck brokerage carriers in the 2012 second quarter was $680.0 million, or 92 percent of revenue, compared to $621.5 million, or 92 percent of revenue, in the 2011 second quarter.  In the 2012 and 2011 second quarters, the Company invoiced customers $79.3 million and $78.7 million, respectively, of fuel surcharges that were passed 100 percent to BCOs and excluded from revenue.  Included in revenue hauled by third-party truck capacity providers in the 2012 and 2011 second quarters were $30.1 million and $25.9 million, respectively, of fuel surcharges invoiced to customers on revenue hauled by third-party truck brokerage carriers.  Revenue hauled by rail, air and ocean cargo carriers was $41.3 million, or 6 percent of revenue, in the 2012 second quarter compared to $39.9 million, or 6 percent of revenue, in the 2011 second quarter. 

Trailing twelve-month return on average shareholder's equity was 41 percent and trailing twelve-month return on invested capital, net income divided by the sum of average equity plus average debt, was 29 percent.  Landstar also announced that its Board of Directors has declared a quarterly dividend of $0.06 per share.  The dividend is payable on August 31, 2012 to stockholders of record at the close of business on August 13, 2012.  Also during the 2012 second quarter, the Company entered into a new credit agreement to refinance its existing credit facility.  The new credit facility will expire in June 2017.

In addition, Landstar announced that its Board of Directors authorized the purchase of an additional 2,000,000 shares of its common stock from time-to-time in the open market and in privately negotiated transactions.  During the 2012 second quarter, Landstar purchased 315,600 shares of its common stock at a total cost of $15,752,000.  Currently, there are approximately 2,200,000 shares of the Company's common stock available for purchase under Landstar's authorized share purchase program. 

"Landstar's 2012 second quarter performance was the best second quarter operating performance in Landstar history," said Landstar Chairman, President and CEO Henry Gerkens. "Revenue in the 2012 second quarter increased approximately $60 million over the 2011 second quarter to record second quarter revenue of $736.0 million.  Gross profit in the 2012 second quarter increased 5 percent over the 2011 second quarter to record second quarter gross profit of $116.7 million.  Operating income in the 2012 second quarter increased 21 percent over the 2011 second quarter to record second quarter operating income of $58.8 million.  Diluted earnings per share in the 2012 second quarter increased 23 percent over the 2011 second quarter to record second quarter diluted earnings per share of $0.76. The record second quarter performance was led by continued strength in demand for Landstar's truck transportation services as Landstar continues to execute on its solutions oriented approach to customers.  The number of loads hauled on truck capacity in the 2012 second quarter increased 8 percent over the 2011 second quarter.  As anticipated, the increase in pricing on truck transportation on a quarter over prior year quarter basis has moderated to some degree, but still remained high in relation to historical amounts."

Gerkens continued, "Demand for the Company's truck transportation services continued to be strong throughout the 2012 second quarter.  Available truck capacity in the flatbed/unsided trailing equipment market continued to lag demand and available truck capacity in the van arena was in-line with demand.  Historically, revenue in the Company's core business during the fiscal third quarter has been relatively consistent with revenue generated in the Company's core business during the fiscal second quarter.  Assuming the current and historical operating trends continue, I would expect 2012 third quarter diluted earnings per share to be within a range of $0.71 to $0.75."

Landstar will hold a live webcast of its quarterly earnings conference call this afternoon at 2:00 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 Second Quarter 2012 Earnings Release Conference Call."  The webcast will be available on the Company's website through Thursday, August 2, 2012.

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 2011 fiscal year, described in Item 1A Risk Factors, and in 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 and logistics services to a broad range of customers worldwide utilizing a network of agents, third-party capacity owners and employees.  All Landstar transportation services 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.

www.landstar.com

 (Tables follow)

  

Landstar System, Inc. and Subsidiary

Consolidated Statements of Income

(Dollars in thousands, except per share amounts)

(Unaudited)

































Twenty Six Weeks Ended


Thirteen Weeks Ended







June 30,


June 25,


June 30,


June 25,







2012


2011


2012


2011














Revenue


$                      1,384,996


$  1,247,547


$                   735,973


$     675,561

Investment income


792


921


405


393












Costs and expenses:










Purchased transportation


1,055,703


941,360


562,781


509,982


Commissions to agents


106,692


98,175


56,460


54,004


Other operating costs


11,188


15,623


4,716


7,679


Insurance and claims


20,401


24,715


9,306


13,449


Selling, general and administrative


76,461


73,046


37,662


35,782


Depreciation and amortization


13,404


12,787


6,664


6,388
















Total costs and expenses


1,283,849


1,165,706


677,589


627,284














Operating income


101,939


82,762


58,789


48,670

Interest and debt expense


1,494


1,605


770


777














Income before income taxes


100,445


81,157


58,019


47,893

Income taxes 


37,743


31,002


22,164


18,295














Net income


62,702


50,155


35,855


29,598

Less: Net loss attributable to noncontrolling interest


-


(62)


-


-

Net income attributable to Landstar System,










Inc. and subsidiary


$                          62,702


$      50,217


$                     35,855


$      29,598














Earnings per common share attributable to










Landstar System, Inc. and subsidiary


$                              1.34


$          1.05


$                         0.76


$          0.62














Diluted earnings per share attributable to 










Landstar System, Inc. and subsidiary


$                              1.33


$          1.05


$                         0.76


$          0.62














Average number of shares outstanding:










Earnings per common share  


46,856,000


47,826,000


46,915,000


47,782,000


Diluted earnings per share


47,083,000


47,907,000


47,104,000


47,912,000














Dividends paid per common share


$                            0.110


$        0.100


$                       0.055


$        0.050















 

Landstar System, Inc. and Subsidiary

Consolidated Balance Sheets

(Dollars in thousands, except per share amounts)

(Unaudited)













June 30,


Dec. 31,



2012


2011

ASSETS





Current assets:






Cash and cash equivalents


$ 64,395


$ 80,900


Short-term investments


36,601


27,944


Trade accounts receivable, less allowance







of $7,379 and $6,591


423,059


368,377


Other receivables, including advances to independent







contractors, less allowance of $4,727 and $5,384


54,938


53,263


Deferred income taxes and other current assets


23,089


21,308



Total current assets


602,082


551,792






Operating property, less accumulated depreciation








and amortization of $150,687 and $145,804


152,059


142,146

Goodwill


57,470


57,470

Other assets


71,687


57,041

Total assets


$ 883,298


$ 808,449






LIABILITIES AND SHAREHOLDERS' EQUITY





Current liabilities:






Cash overdraft


$ 24,072


$ 25,905


Accounts payable


203,919


163,307


Current maturities of long-term debt


16,937


17,212


Insurance claims


69,156


76,624


Other current liabilities


46,984


48,065



Total current liabilities


361,068


331,113






Long-term debt, excluding current maturities


108,617


115,130

Insurance claims


25,297


27,494

Deferred income taxes and other non-current liabilities


40,557


34,135










Shareholders' equity:






Common stock, $0.01 par value, authorized 160,000,000







shares, issued 66,851,672 and 66,602,486 shares


669


666


Additional paid-in capital


170,921


165,712


Retained earnings


1,004,701


947,156


Cost of 20,202,662 and 19,882,289 shares of common







stock in treasury


(829,443)


(813,684)


Accumulated other comprehensive income


911


727



Total shareholders' equity


347,759


300,577

Total liabilities and shareholders' equity


$ 883,298


$ 808,449











Landstar System, Inc. and Subsidiary

Supplemental Information

(Unaudited)


























Twenty Six Weeks Ended



Thirteen Weeks Ended




June 30,


June 25,



June 30,


June 25,




2012


2011



2012


2011

Revenue generated through (in thousands):






















Business Capacity Owners (1)


$ 701,248


$ 669,748



$ 371,886


$ 362,854


Truck Brokerage Carriers


578,932


472,391



308,090


258,668


Rail intermodal


36,220


34,832



18,838


18,367


Ocean and air cargo carriers


40,127


42,931



22,458


21,538


Other (2)


28,469


27,645



14,701


14,134




$ 1,384,996


$ 1,247,547



$ 735,973


$ 675,561























Number of loads:






















Business Capacity Owners (1)


415,150


402,730



215,950


210,690


Truck Brokerage Carriers


333,600


287,210



175,570


151,470


Rail intermodal


14,820


14,830



7,660


7,570


Ocean and air cargo carriers


7,910


7,950



3,930


4,170




771,480


712,720



403,110


373,900























Revenue per load:






















Business Capacity Owners (1)


$ 1,689


$ 1,663



$ 1,722


$ 1,722


Truck Brokerage Carriers


1,735


1,645



1,755


1,708


Rail intermodal


2,444


2,349



2,459


2,426


Ocean and air cargo carriers


5,073


5,400



5,715


5,165































June 30,


June 25,









2012


2011

Truck Capacity Providers






















Business Capacity Owners (1) (3)







7,959


7,711


Truck Brokerage Carriers:











   Approved and active (4)







19,283


17,696


   Approved







9,051


8,984









28,334


26,680


Total available truck capacity providers







36,293


34,391












(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 8,478 and 8,231 at June 30, 2012 and June 25, 2011, respectively.


(4) Active refers to Truck Brokerage Carriers who have moved at least one load in the past 180 days.



SOURCE Landstar System, Inc.



RELATED LINKS
http://www.landstar.com

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.