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MONDOVI, Wis., April 19, 2018 -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported a 25.8% increase in net income to $10.3 million, or 19 cents per diluted share, for the first quarter ended March 31, 2018, from $8.2 million, or 15 cents per diluted share, for the first quarter of 2017. The increase in earnings was primarily due to the reduction of Marten's federal income tax rate under the Tax Cuts and Jobs Act of 2017.
Operating revenue improved 8.0% to $187.0 million for the first quarter of 2018 from $173.2 million for the first quarter of 2017. Excluding fuel surcharges, operating revenue improved 4.7% to $163.8 million for the 2018 quarter from $156.6 million for the 2017 quarter. Fuel surcharge revenue increased to $23.1 million for the first quarter of 2018 from $16.6 million for the 2017 quarter.
Operating expenses as a percentage of operating revenue was 92.7% for the first quarter of 2018 and 92.0% for the first quarter of 2017. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, was 91.7% for the first quarter of 2018 compared with 91.1% for the first quarter of 2017.
Chairman and Chief Executive Officer Randolph L. Marten said, “We continue to position our operations to capitalize on the strengthened freight environment. We improved our revenue excluding fuel surcharges in our Dedicated and Intermodal operations, our primary growth areas for this year, by 17.6% over the first quarter of 2017. We expect to deliver revenue and profitability growth throughout 2018 with increased compensation for our premium services, additional freight with existing and new customers, and our continued emphasis on cost controls.”
“Our agreements with a number of customers included a shift during the quarter between line haul and fuel surcharge revenue, which reduced our Dedicated and Truckload revenue, net of fuel surcharges, by $106 and $13 per tractor per week, while increasing our fuel surcharge revenue by the same amounts.”
Marten Transport, with headquarters in Mondovi, Wis., is one of the leading temperature-sensitive truckload carriers in the United States, specializing in transporting and distributing food and other consumer packaged goods that require a temperature-controlled or insulated environment. Marten’s dry freight services are expanding, with 1,376 dry trailers operating as of March 31, 2018. Marten offers service in the United States, Canada and Mexico, concentrating on expedited movements for high-volume customers. Marten’s common stock is traded on the Nasdaq Global Select Market under the symbol MRTN.
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include our discussion of the Company’s prospects for future growth and by their nature involve substantial risks and uncertainties, and actual results may differ materially from those expressed in such forward-looking statements. Important factors known to the Company that could cause actual results to differ materially from those discussed in the forward-looking statements are discussed in Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise.
CONTACTS: Tim Kohl, President, and Jim Hinnendael, Executive Vice President and Chief Financial Officer, of Marten Transport, Ltd., 715-926-4216.
MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
| (In thousands, except share information) | March 31, 2018 | December 31, 2017 | ||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 10,398 | $ | 15,791 | ||||
| Receivables: | ||||||||
| Trade, net | 82,090 | 74,886 | ||||||
| Other | 7,037 | 6,131 | ||||||
| Prepaid expenses and other | 19,186 | 19,810 | ||||||
| Total current assets | 118,711 | 116,618 | ||||||
| Property and equipment: | ||||||||
| Revenue equipment, buildings and land, office equipment and other | 808,750 | 783,648 | ||||||
| Accumulated depreciation | (217,558 | ) | (211,728 | ) | ||||
| Net property and equipment | 591,192 | 571,920 | ||||||
| Other assets | 2,062 | 1,865 | ||||||
| Total assets | $ | 711,965 | $ | 690,403 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 49,421 | $ | 38,100 | ||||
| Insurance and claims accruals | 25,414 | 26,177 | ||||||
| Total current liabilities | 74,835 | 64,277 | ||||||
| Deferred income taxes | 101,676 | 100,626 | ||||||
| Total liabilities | 176,511 | 164,903 | ||||||
| Stockholders’ equity: | ||||||||
| Preferred stock, $.01 par value per share; 2,000,000 shares authorized; no shares issued and outstanding | - | - | ||||||
| Common stock, $.01 par value per share; 96,000,000 shares authorized; 54,589,542 shares at March 31, 2018, and 54,533,455 shares at December 31, 2017, issued and outstanding | 546 | 545 | ||||||
| Additional paid-in capital | 76,915 | 76,413 | ||||||
| Retained earnings | 457,993 | 448,542 | ||||||
| Total stockholders’ equity | 535,454 | 525,500 | ||||||
| Total liabilities and stockholders’ equity | $ | 711,965 | $ | 690,403 | ||||
MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months | ||||||||
| Ended March 31, | ||||||||
| (In thousands, except per share information) | 2018 | 2017 | ||||||
| Operating revenue | $ | 186,960 | $ | 173,159 | ||||
| Operating expenses (income): | ||||||||
| Salaries, wages and benefits | 58,822 | 56,400 | ||||||
| Purchased transportation | 35,026 | 29,362 | ||||||
| Fuel and fuel taxes | 29,044 | 25,956 | ||||||
| Supplies and maintenance | 10,436 | 10,990 | ||||||
| Depreciation | 21,815 | 21,383 | ||||||
| Operating taxes and licenses | 2,287 | 2,247 | ||||||
| Insurance and claims | 10,290 | 8,914 | ||||||
| Communications and utilities | 1,683 | 1,581 | ||||||
| Gain on disposition of revenue equipment | (1,211 | ) | (1,103 | ) | ||||
| Other | 5,174 | 3,491 | ||||||
| Total operating expenses | 173,366 | 159,221 | ||||||
| Operating income | 13,594 | 13,938 | ||||||
| Other | (189 | ) | 141 | |||||
| Income before income taxes | 13,783 | 13,797 | ||||||
| Income taxes expense | 3,452 | 5,583 | ||||||
| Net income | $ | 10,331 | $ | 8,214 | ||||
| Basic earnings per common share | $ | 0.19 | $ | 0.15 | ||||
| Diluted earnings per common share | $ | 0.19 | $ | 0.15 | ||||
| Dividends declared per common share | $ | 0.025 | $ | 0.015 | ||||
MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
| Dollar | Percentage | |||||||||||||||
| Change | Change | |||||||||||||||
| Three Months | Three Months | Three Months | ||||||||||||||
| Ended | Ended | Ended | ||||||||||||||
| March 31, | March 31, | March 31, | ||||||||||||||
| (Dollars in thousands) | 2018 | 2017 | 2018 vs. 2017 | 2018 vs. 2017 | ||||||||||||
| Operating revenue: | ||||||||||||||||
| Truckload revenue, net of fuel surcharge revenue | $ | 80,216 | $ | 84,811 | $ | (4,595 | ) | (5.4 | )% | |||||||
| Truckload fuel surcharge revenue | 12,801 | 10,847 | 1,954 | 18.0 | ||||||||||||
| Total Truckload revenue | 93,017 | 95,658 | (2,641 | ) | (2.8 | ) | ||||||||||
| Dedicated revenue, net of fuel surcharge revenue | 42,364 | 36,899 | 5,465 | 14.8 | ||||||||||||
| Dedicated fuel surcharge revenue | 6,469 | 3,378 | 3,091 | 91.5 | ||||||||||||
| Total Dedicated revenue | 48,833 | 40,277 | 8,556 | 21.2 | ||||||||||||
| Intermodal revenue, net of fuel surcharge revenue | 20,808 | 16,811 | 3,997 | 23.8 | ||||||||||||
| Intermodal fuel surcharge revenue | 3,844 | 2,375 | 1,469 | 61.9 | ||||||||||||
| Total Intermodal revenue | 24,652 | 19,186 | 5,466 | 28.5 | ||||||||||||
| Brokerage revenue | 20,458 | 18,038 | 2,420 | 13.4 | ||||||||||||
| Total operating revenue | $ | 186,960 | $ | 173,159 | $ | 13,801 | 8.0 | % | ||||||||
| Operating income: | ||||||||||||||||
| Truckload | $ | 6,815 | $ | 5,974 | $ | 841 | 14.1 | % | ||||||||
| Dedicated | 2,488 | 4,487 | (1,999 | ) | (44.6 | ) | ||||||||||
| Intermodal | 2,978 | 2,149 | 829 | 38.6 | ||||||||||||
| Brokerage | 1,313 | 1,328 | (15 | ) | (1.1 | ) | ||||||||||
| Total operating income | $ | 13,594 | $ | 13,938 | $ | (344 | ) | (2.5 | )% | |||||||
| Operating ratio: | ||||||||||||||||
| Truckload | 92.7 | % | 93.8 | % | ||||||||||||
| Dedicated | 94.9 | 88.9 | ||||||||||||||
| Intermodal | 87.9 | 88.8 | ||||||||||||||
| Brokerage | 93.6 | 92.6 | ||||||||||||||
| Consolidated operating ratio | 92.7 | % | 92.0 | % | ||||||||||||
MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)
| Three Months | ||||||||
| Ended March 31, | ||||||||
| 2018 | 2017 | |||||||
| Truckload Segment: | ||||||||
| Revenue (in thousands) | $ | 93,017 | $ | 95,658 | ||||
| Average revenue, net of fuel surcharges, per tractor per week(1) | $ | 3,679 | $ | 3,416 | ||||
| Average tractors(1) | 1,696 | 1,931 | ||||||
| Average miles per trip | 603 | 615 | ||||||
| Non-revenue miles percentage(2) | 6.8 | % | 9.6 | % | ||||
| Total miles (in thousands) | 40,582 | 46,060 | ||||||
| Dedicated Segment: | ||||||||
| Revenue (in thousands) | $ | 48,833 | $ | 40,277 | ||||
| Average revenue, net of fuel surcharges, per tractor per week(1) | $ | 3,267 | $ | 3,462 | ||||
| Average tractors(1) | 1,009 | 829 | ||||||
| Average miles per trip | 297 | 299 | ||||||
| Non-revenue miles percentage(2) | 1.1 | % | 0.7 | % | ||||
| Total miles (in thousands) | 21,135 | 18,579 | ||||||
| Intermodal Segment: | ||||||||
| Revenue (in thousands) | $ | 24,652 | $ | 19,186 | ||||
| Loads | 10,737 | 9,584 | ||||||
| Average tractors | 82 | 77 | ||||||
| Brokerage Segment: | ||||||||
| Revenue (in thousands) | $ | 20,458 | $ | 18,038 | ||||
| Loads | 11,889 | 13,354 | ||||||
| At March 31, 2018 and March 31, 2017: | ||||||||
| Total tractors(1) | 2,785 | 2,827 | ||||||
| Average age of company tractors (in years) | 1.6 | 1.5 | ||||||
| Total trailers | 5,308 | 4,955 | ||||||
| Average age of company trailers (in years) | 2.6 | 2.8 | ||||||
| Ratio of trailers to tractors(1) | 1.9 | 1.8 | ||||||
| Three Months | ||||||||
| Ended March 31, | ||||||||
| (In thousands) | 2018 | 2017 | ||||||
| Net cash provided by operating activities | $ | 23,182 | $ | 37,674 | ||||
| Net cash (used for) investing activities | (27,392 | ) | (20,962 | ) | ||||
| Net cash (used for) financing activities | (1,183 | ) | (8,135 | ) | ||||
| Weighted average shares outstanding: | ||||||||
| Basic | 54,572 | 54,426 | ||||||
| Diluted | 55,095 | 54,738 | ||||||
| (1 | ) | Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 55 and 67 tractors as of March 31, 2018 and 2017, respectively. |
| (2 | ) | Represents the percentage of miles for which the company is not compensated. |
