Hub Group, Inc. Reports Earnings for the Fourth Quarter and Full Year 2010

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Jan 27, 2011, 04:00 ET

DOWNERS GROVE, Ill., Jan. 27, 2011 /PRNewswire/ -- Hub Group, Inc. (Nasdaq: HUBG) today reported income of $13 million for the fourth quarter of 2010, an increase of 26% compared to the fourth quarter of 2009. Hub Group's diluted earnings per share was $0.34 for the fourth quarter of 2010, which represents an increase of 31% when compared with the prior year period.

Hub Group's revenue increased 18% to $480 million compared to $408 million in the fourth quarter of 2009. Fourth quarter intermodal revenue increased 19% to $340 million. The increase was attributable to a 14% volume increase, a 4% increase for fuel and a 4% increase in pricing, partially offset by a 3% decrease for mix. Truck brokerage revenue was $79 million this quarter, which is equal to revenue in the fourth quarter of 2009. Fourth quarter Unyson Logistics revenue increased 38% to $61 million.

"The fourth quarter was a solid finish to an outstanding year," remarked David P. Yeager, Chairman and Chief Executive Officer of Hub Group. "For the year we grew all three business lines, with our intermodal volume up 19%. Going into our 40th anniversary year, we are well positioned for continued growth."

FULL YEAR 2010

Income for the year ended December 31, 2010 was $43 million. Hub Group's diluted earnings per share for 2010 was $1.16.

As of December 31, 2010, the Company had $115 million of cash and no debt.

CONFERENCE CALL

Hub Group will hold its conference call at 5:00 p.m. Eastern Time on January 27, 2011 to discuss its fourth quarter and full year results and provide 2011 guidance.

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 at Hub Group's Web site at http://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) 713-4218. The conference call participant code is 73276818. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PB7HQ39MX . 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 http://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 over 30 offices 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, 2009 and the reports on Form 10-Q for the periods ended March 31, 2010, June 30, 2010 and September 30, 2010. 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		Twelve Months
			Ended December 31,		Ended December 31,
			2010	2009	2010	2009
Revenue			$ 479,913	$ 407,881	$ 1,833,737	$ 1,510,970

Transportation costs			423,271	361,323	1,620,304	1,325,280
	Gross margin		56,642	46,558	213,433	185,690

Costs and expenses:
	Salaries and benefits		26,270	21,004	99,138	88,518
	General and administrative		10,207	9,092	40,621	37,467
	Depreciation and amortization		947	945	3,792	4,174
		Total costs and expenses	37,424	31,041	143,551	130,159

Operating income			19,218	15,517	69,882	55,531

Other income (expense):
	Interest expense		(16)	(15)	(54)	(91)
	Interest income		36	26	119	146
	Other, net		62	111	146	299
		Total other (expense) income	82	122	211	354

Income before provision for income taxes			19,300	15,639	70,093	55,885

Provision for income taxes			6,791	5,688	26,635	21,620

Net income			$ 12,509	$ 9,951	$ 43,458	$ 34,265

Basic earnings per common share			$ 0.34	$ 0.27	$ 1.17	$ 0.92

Diluted earnings per common share			$ 0.34	$ 0.26	$ 1.16	$ 0.91

Basic weighted average number of shares outstanding			36,817	37,428	37,223	37,367
Diluted weighted average number of shares outstanding			37,027	37,657	37,385	37,525

HUB GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)


					December 31,	December 31,
					2010	2009

ASSETS
	CURRENT ASSETS:
		Cash and cash equivalents			$ 115,144	$ 126,863
		Accounts receivable trade, net			185,879	145,317
		Accounts receivable trade other			17,958	11,932
		Prepaid taxes			296	593
		Deferred taxes			3,314	2,874
		Prepaid expenses and other current assets			6,569	6,801
			TOTAL CURRENT ASSETS		329,160	294,380

	Restricted investments				11,421	9,583
	Property and equipment, net				47,806	28,510
	Other intangibles, net				5,856	6,164
	Goodwill, net				233,029	232,892
	Other assets				2,135	1,819
				TOTAL ASSETS	$ 629,407	$ 573,348


LIABILITIES AND STOCKHOLDERS' EQUITY
	CURRENT LIABILITIES:
		Accounts payable trade			$ 121,078	$ 110,626
		Accounts payable other			10,064	7,695
		Accrued payroll			14,378	8,253
		Accrued other			21,898	18,958
			TOTAL CURRENT LIABILITIES		167,418	145,532

	Non-current liabilities				13,950	12,002
	Deferred taxes				71,739	61,973
	STOCKHOLDERS' EQUITY:
		Preferred stock, $.01 par value; 2,000,000 shares authorized; no shares issued or outstanding in 2010 and 2009			-	-
		Common stock
			Class A: $.01 par value; 97,337,700 shares authorized and 41,224,792 shares issued in 2010 and 2009; 36,638,359 outstanding in 2010 and 37,253,330 outstanding in 2009		412	412
			Class B: $.01 par value; 662,300 shares authorized; 662,296 shares issued and outstanding in 2010 and 2009		7	7
		Additional paid-in capital			169,722	171,470
		Purchase price in excess of predecessor basis, net of tax benefit of $10,306			(15,458)	(15,458)
		Retained earnings			343,010	299,552
		Accumulated other comprehensive income (loss)			6	(9)
		Treasury stock; at cost, 4,586,433 shares in 2010 and 3,971,462 shares in 2009			(121,399)	(102,133)
			TOTAL STOCKHOLDERS' EQUITY		376,300	353,841
				TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 629,407	$ 573,348

HUB GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

					Twelve Months Ended
					December 31,
					2010	2009


Cash flows from operating activities:
	Net income				$ 43,458	$ 34,265
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization			8,572	8,199
		Deferred taxes			9,545	5,519
		Compensation expense related to share-based compensation plans			3,576	4,394
		Loss on sale of assets			85	50
	Changes in operating assets and liabilities:
		Restricted investments			(1,838)	(3,465)
		Accounts receivable, net			(46,582)	(1,569)
		Prepaid taxes			298	(470)
		Prepaid expenses and other current assets			233	(2,455)
		Other assets			298	(72)
		Accounts payable			12,822	7,150
		Accrued expenses			5,277	(8,603)
		Non-current liabilities			1,910	2,285
				Net cash provided by operating activities	37,654	45,228

Cash flows from investing activities:
	Proceeds from sale of equipment				988	84
	Purchases of property and equipment				(25,616)	(4,246)
	Cash used in acquisitions				(170)	-
			Net cash used in investing activities		(24,798)	(4,162)

Cash flows from financing activities:
	Proceeds from stock options exercised				46	256
	Purchase of treasury stock				(25,070)	(1,101)
	Excess tax benefits from share-based compensation				434	852
			Net cash (used in) provided by financing activities		(24,590)	7


Effect of exchange rate changes on cash and cash equivalents					15	(9)

Net (decrease) increase in cash and cash equivalents					(11,719)	41,064
Cash and cash equivalents beginning of year					126,863	85,799
Cash and cash equivalents end of year					$ 115,144	$ 126,863