Universal Truckload Services, Inc. Reports 2015 Financial Results

Feb 25, 2016, 16:37 ET from Universal Truckload Services, Inc.

WARREN, Mich., Feb. 25, 2016 /PRNewswire/ -- Universal Truckload Services, Inc. (NASDAQ: UACL) today reported 2015 consolidated net income of $40.0 million, or $1.37 per basic and diluted share, on total operating revenue of $1.13 billion.  Net income in the fourth quarter of 2015 totaled $9.3 million, or $0.33 per basic and diluted share, on total operating revenue of $286.0 million.  This compares to $10.5 million of net income on total operating revenue of $302.5 million in the fourth quarter of 2014.

Operating revenues from transportation services decreased $17.7 million, or 9.1%, to $177.5 million in the quarter ended December 31, 2015, from the comparable period one year earlier, due partially to a 7.7% year-over-year decrease in loads and a 1.4% decrease in average operating revenues per load, excluding fuel surcharges.  Value-added services revenues increased $1.7 million in the most recent quarter.  Revenues from intermodal services declined 1.1%, to $37.0 million from $37.4 million in the fourth quarter of 2014.  

As we previously announced, demand for Universal's transportation and logistics services broadly met fourth quarter 2015 expectations.  Revenues from those operations included in our transportation segment decreased $25.3 million, or 12.4%, to $178.6 million in the quarter from $203.9 million one year earlier.  $10.2 million of the decline relates to reduced fuel surcharges, triggered by lower oil prices.  Revenues from our logistics segment increased $8.7 million, or 8.8%, to $107.2 million in the quarter ended December 31, 2015 compared to $98.5 million in the fourth quarter of 2014.  Growth in our logistics segment is the result of solid continuing demand from automotive customers and from new operating locations, which were partially offset by slowing demand from heavy truck and selected industrial customers.

Income from operations totaling $18.5 million in the fourth quarter of 2015 was comparable to one year earlier, despite the $16.5 million decline in total operating revenues.  Expressed as a percentage of operating revenue, income from operations increased to 6.5% in 2015 fourth quarter, compared to 6.2% in 2014 fourth quarter.  Net income and earnings per share also reflects a non-cash charge of approximately $0.8 million after tax related to our December 2015 refinancing of outstanding indebtedness.

Jeff Rogers, our chief executive officer, commented, "Universal's 2015 financial performance was a mixed bag.  Our intermodal operations enjoyed a record year, and our value-added services operations enjoyed stable demand and growth in the number of operations and new projects as we ended the year.  In contrast, slack demand for flatbed and heavy haul truckload services, particularly from oil and gas exploration and steel customers, undercut progress toward our long term growth objectives.  Declining fuel surcharges due to lower diesel prices further impacted 2015 revenues from transportation services, further reducing our consolidated revenues.

"I currently expect slow-but-stable demand from our principal customers in 2016, with some weakness in demand for value-added services provided to heavy truck manufacturers.  Overall, the macro environment gives us a stable platform as we focus on growth opportunities, particularly in our value-added services pipeline and from our differentiated intermodal offering."

Universal calculates and reports selected financial metrics in connection with lending arrangements, or to isolate and exclude the impact of non-operating expenses related to our corporate development activities.  These statistics are described in more detail below in the section captioned "Non-GAAP Financial Measures."

As of December 31, 2015, we held cash and cash equivalents totaling $12.9 million and marketable securities totaling $13.4 million.  Outstanding debt at year end totaled $234.9 million and obligations pursuant to capital leases were valued at $2.0 million

Universal Truckload Services, Inc. announced today that our Board of Directors has declared a quarterly cash dividend of $0.07 per share of common stock.  The dividend is payable to shareholders of record at the close of business on March 7, 2016 and is expected to be paid on March 17, 2016.  The Board of Directors also confirmed the appointment of Richard P. Urban, a director and member of our Audit Committee, as chairman of the Audit Committee, filling the vacancy created by the passing of Ted B. Wahby on December 5, 2015.

Conference call:

We invite investors and analysts to our quarterly earnings conference call.  During the call, Jeff Rogers, CEO,  and David Crittenden, CFO, will discuss Universal's fourth quarter and full year 2015 financial performance, the demand outlook in our key markets, the impact of pricing, fuel surcharges and foreign currency changes on our revenues and profits, and other trends impacting our business.

Quarterly Earnings Conference Call Dial-in Details:

Time:

10:00 AM ET

Date:

Friday, February 26, 2016

Call Toll Free: 

(866) 622-0924

International Dial-in: 

+1 (660) 422-4956

Conference ID:  

26586117

A replay of our conference call will be available two hours after the call through March 24, 2016, by calling (855) 859-2056 (toll free) or +1 (404) 537-3406 (toll) and using conference ID 26586117. The call will also be available on investors.goutsi.com.

About Universal:

Universal Truckload Services, Inc. is a leading asset-light provider of customized transportation and logistics solutions throughout the United States, and in Mexico, Canada and Colombia.  We provide our customers with supply chain solutions that can be scaled to meet their changing demands and volumes.  We offer our customers a broad array of services across their entire supply chain, including transportation, value-added and intermodal services. 

Forward Looking Statements

Some of the statements contained in this press release might be considered forward-looking statements.  These statements identify prospective information.  Forward-looking statements are based on information available at the time and/or management's good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements.  These forward-looking statements are subject to a number of factors that may cause actual results to differ materially from the expectations described.  Additional information about the factors that may adversely affect these forward-looking statements is contained in the Company's reports and filings with the Securities and Exchange Commission.  The Company assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws.

 

UNIVERSAL TRUCKLOAD SERVICES, INC.
Unaudited Condensed Consolidated Statements of Income
(In thousands, except per share data)



Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2015



2014



2015



2014


Operating revenues:

















Transportation services


$

177,466



$

195,210



$

696,134



$

769,308


Value-added services



71,535




69,837




285,258




284,496


Intermodal services



36,990




37,433




147,381




137,717


Total operating revenues



285,991




302,480




1,128,773




1,191,521



















Operating expenses:

















Purchased transportation and equipment rent



139,706




159,115




567,558




615,327


Direct personnel and related benefits



61,279




51,234




220,653




208,505


Commission expense



9,832




11,482




37,844




43,922


Operating expense (exclusive of items shown separately)



26,899




25,967




108,523




116,611


Occupancy expense



6,831




6,272




27,004




25,063


Selling, general and administrative



9,786




12,558




37,510




42,214


Insurance and claims



4,770




8,138




21,413




25,991


Depreciation and amortization



8,424




8,921




34,873




33,053


Total operating expenses



267,527




283,687




1,055,378




1,110,686


Income from operations



18,464




18,793




73,395




80,835


Interest expense, net



(3,359)




(2,096)




(9,180)




(8,183)


Other non-operating income (expense)



(17)




132




790




447


Income before provision for income taxes



15,088




16,829




65,005




73,099


Provision for income taxes



5,782




6,310




25,004




27,729


Net income


$

9,306



$

10,519



$

40,001



$

45,370



















Earnings per common share:

















Basic


$

0.33



$

0.35



$

1.37



$

1.51


Diluted


$

0.33



$

0.35



$

1.37



$

1.51



















Weighted average number of common shares outstanding:

















Basic



28,380




29,946




29,233




30,013


Diluted



28,382




29,952




29,235




30,044



















Dividends declared per common share


$

0.07



$

0.07



$

0.28



$

0.28


 

UNIVERSAL TRUCKLOAD SERVICES, INC.
Unaudited Condensed Consolidated Balance Sheets
(In thousands)



December 31, 2015



December 31, 2014


Assets









Cash and cash equivalents


$

12,930



$

8,001


Marketable securities



13,431




14,309


Accounts receivable - net



141,275




151,107


Other current assets



41,895




42,863


Total current assets



209,531




216,280


Property and equipment - net



177,189




178,069


Other long-term assets - net



124,278




134,665


Total assets


$

510,998



$

529,014











Liabilities and shareholders' equity









Current liabilities, excluding current maturities of capital lease obligations and debt


$

91,700



$

103,389


Capital lease obligations



1,981




3,031


Debt



234,913




235,298


Other long-term liabilities



51,323




50,135


Total liabilities



379,917




391,853


Total shareholders' equity



131,081




137,161


Total liabilities and shareholders' equity


$

510,998



$

529,014


 

UNIVERSAL TRUCKLOAD SERVICES, INC.
Unaudited Summary of Operating Data



Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2015



2014



2015



2014


Transportation Services:

















Average operating revenues per loaded mile (a)


$

2.61



$

3.03



$

2.69



$

2.99


Average operating revenues per loaded mile, excluding fuel surcharges, where separately identifiable (a)


$

2.44



$

2.68



$

2.47



$

2.61


Average operating revenues per load (a)


$

1,023



$

1,096



$

1,028



$

1,064


Average operating revenues per load, excluding fuel surcharges, where separately identifiable (a)


$

956



$

970



$

945



$

928


Average length of haul (a) (b)



392




362




382




356


Number of loads (a)



149,386




161,862




602,739




643,375



















Value Added Services:

















Number of facilities (c)

















Customer provided



17




15




17




15


Company leased



32




30




32




30


Total



49




45




49




45



















Intermodal Services:

















Drayage (in thousands)


$

34,000



$

34,276



$

135,062



$

124,609


Domestic Intermodal (in thousands)



469




665




2,108




3,315


Depot (in thousands)



2,521




2,492




10,211




9,793


Total (in thousands)


$

36,990



$

37,433



$

147,381



$

137,717



















Average operating revenues per loaded mile


$

5.42



$

5.60



$

5.46



$

5.39


Average operating revenues per loaded mile, excluding fuel

   surcharges, where separately identifiable


$

4.69



$

4.55



$

4.62



$

4.35


Average operating revenues per load


$

399



$

414



$

410



$

404


Average operating revenues per load, excluding fuel surcharges, where separately identifiable


$

346



$

336



$

347



$

326


Number of loads



85,140




82,830




329,426




308,509


Number of container yards



10




11




10




11


 

(a)    Excludes operating data from Universal Logistics Solutions International, Inc., in order to improve the relevance of the statistical data related to our brokerage services and improve the comparability to our peer companies. Also excludes final mile delivery and shuttle service loads.

(b)    Average length of haul is computed using loaded miles, excluding final mile delivery and shuttle service loads.

(c)    Excludes storage yards, terminals and office facilities.

 

UNIVERSAL TRUCKLOAD SERVICES, INC.
Unaudited Summary of Operating Data - Continued



Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2015



2014



2015



2014


Average Headcount:

















Employees



4,396




4,173




4,397




4,219


Full time equivalents



1,844




1,446




1,606




1,528


Total



6,240




5,619




6,003




5,747



















Average number of tractors:

















Provided by owner-operators



3,293




3,239




3,298




3,305


Owned



766




839




811




808


Third party lease



41




74




33




67


Total



4,100




4,152




4,142




4,180



















Operating Revenues by Segment:

















Transportation


$

178,554



$

203,936



$

721,437



$

778,603


Logistics



107,230




98,458




406,822




412,507


Other



207




86




514




411




$

285,991



$

302,480



$

1,128,773



$

1,191,521



















Income from Operations by Segment:

















Transportation


$

5,080



$

9,584



$

28,683



$

34,931


Logistics



12,222




11,138




43,848




50,892


Other



1,162




(1,929)




864




(4,988)




$

18,464



$

18,793



$

73,395



$

80,835



Non-GAAP Financial Measures

In addition to providing consolidated financial statements based on generally accepted accounting principles in the United States of America (GAAP), we are providing additional financial measures that are not required by or prepared in accordance with GAAP (non-GAAP). We present EBITDA as supplemental measures of our performance. We define EBITDA as net income plus (i) interest expense, net, (ii) provision for income taxes and (iii) depreciation and amortization, and less other non-operating income, or EBITDA. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis.

In accordance with the requirements of Regulation G issued by the Securities and Exchange Commission, we are presenting the most directly comparable GAAP financial measure and reconciling the non-GAAP financial measure to the comparable GAAP measure. Set forth below is a reconciliation of net income, the most comparable GAAP measure, to EBITDA for each of the periods indicated:



Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2015



2014



2015



2014




( in thousands)



( in thousands)


EBITDA

















Net income


$

9,306



$

10,519



$

40,001



$

45,370


Provision for income taxes



5,782




6,310




25,004




27,729


Interest expense, net



3,359




2,096




9,180




8,183


Depreciation and amortization



8,424




8,921




34,873




33,053


Other non-operating (income) expense



17




(132)




(790)




(447)


EBITDA


$

26,888



$

27,714



$

108,268



$

113,888



















EBITDA margin (a)



9.4

%



9.2

%



9.6

%



9.6

%

 

(a)    EBITDA margin is computed by dividing EBITDA by total operating revenues for each of the periods indicated.

We present EBITDA because we believe it assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

EBITDA has limitations as an analytical tool. Some of these limitations are:

  • EBITDA does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;
  • EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
  • EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts;
  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements; and
  • Other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and EBITDA only supplementally.

 

SOURCE Universal Truckload Services, Inc.



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