Landstar System Reports 31 Percent Increase in Revenue and a 40 Percent Increase in Diluted Earnings Per Share

JACKSONVILLE, Fla., July 14 /PRNewswire-FirstCall/ -- Landstar System, Inc. (Nasdaq: LSTR) reported a 31 percent increase in revenue to $641.7 million in the 2010 second quarter, up from $491.2 million in the 2009 second quarter.  Net income for the 2010 second quarter was $24.4 million, or $0.49 per diluted share, compared to $17.9 million, or $0.35 per diluted share for the 2009 second quarter. Operating income increased 34 percent to $40.0 million in the 2010 second quarter compared to $29.8 million in the 2009 second quarter.

Truck transportation revenue hauled by business capacity owners and truck brokerage carriers in the 2010 second quarter was $592.0 million, or 92 percent of revenue, compared to $453.8 million, or 92 percent of revenue, in the 2009 second quarter.  Included in revenue hauled by truck brokerage carriers in the 2010 and 2009 second quarters were $23.1 million and $9.2 million, respectively, of fuel surcharges invoiced to customers.  In the 2010 and 2009 second quarters, the Company also invoiced customers $53.1 million and $27.3 million, respectively, of fuel surcharges that were passed 100 percent to business capacity owners and excluded from revenue.  Revenue hauled by rail, air and ocean cargo carriers was $35.0 million, or 6 percent of revenue, in the 2010 second quarter compared to $28.2 million, or 6 percent of revenue, in the 2009 second quarter.  Transportation management fee revenue generated by the supply chain solutions companies was $6.1 million, or 1 percent of revenue, in the 2010 second quarter.  

Landstar System, Inc. also announced that its Board of Directors has declared a quarterly dividend of $0.05 per share.  This represents an 11 percent increase in the Company's quarterly dividend.  The dividend is payable on August 27, 2010 to stockholders of record at the close of business on August 9, 2010.  It is the intention of the Board of Directors to continue to pay a quarterly dividend.  During the 2010 second quarter, Landstar purchased 510,062 shares of its common stock at a total cost of $20.6 million.  Under the Company's authorized share purchase program, the Company currently has a total of 745,000 shares of its common stock available for purchase.  

Commenting on Landstar's 2010 second quarter, Landstar's Chairman, President and CEO, Henry Gerkens said, "I am very pleased with the Company's performance in the 2010 second quarter.   2010 second quarter revenue, operating income and diluted earnings per share all increased sharply over the corresponding 2009 second quarter amounts.  Revenue increased 31 percent due to stronger volumes and pricing, operating income increased 34 percent, despite higher purchased transportation costs and insurance and claims costs, and diluted earnings per share increased 40 percent.  The total number of truck transportation loads hauled by business capacity owners and truck brokerage carriers in the 2010 second quarter was the highest reported number of truck transportation loads hauled by business capacity owners and truck brokerage carriers in any quarter of any year in Landstar's history.  Additionally, from a pricing standpoint, revenue per load for truck transportation on freight hauled by business capacity owners and truck brokerage carriers continued to strengthen as we moved through the 2010 second quarter.    

"The overall freight environment continues to be strong.  Recent trends in June, and thus far in July, indicate that both the revenue per load and the number of loads hauled remain strong compared to the corresponding prior year periods.  I expect these trends to continue throughout the 2010 third quarter. I would anticipate 2010 third quarter results to be similar to those experienced in the 2010 second quarter.  As such, I expect 2010 third quarter revenue to increase in a range of 25 percent to 33 percent over 2009 third quarter revenue and diluted earnings per share to be in a range of $0.47 to $0.52."

Landstar will provide a live webcast of its quarterly earnings conference call this afternoon at 5 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 2010 Earnings Release Conference Call."  

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 2009 fiscal year, described in Item 1A Risk Factors, and 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, warehousing and logistics services to a broad range of customers worldwide utilizing a network of agents, third-party capacity owners and employees.  All Landstar transportation companies are certified to ISO 9001:2008 quality management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market® under the symbol LSTR.

SOURCE Landstar System, Inc.