StockSelector.com
  Research, Select, & Monitor Tuesday, January 22, 2019 9:39:59 PM ET  
Trade Ideas The Market Industries Stocks Portfolio

 
Ticker Lookup
Landstar System, Inc.$101.89($2.63)(2.52%)

  Quote | Ranking | Chart | Valuations | Sentiment | Industry | News | Earnings | Analysts | More...

Your Target?

 Landstar System Reports Record Quarterly Revenue of $1.202 Billion and Record Quarterly Diluted Earnings Per Share of $1.63
   Wednesday, October 24, 2018 4:15:00 PM ET

JACKSONVILLE, Fla., Oct. 24, 2018 (GLOBE NEWSWIRE) -- Landstar System, Inc. (NASDAQ: LSTR) reported record quarterly revenue of $1.202 billion in the 2018 third quarter, a 27 percent increase over revenue of $943 million reported in the 2017 third quarter. Net income of $67.0 million and diluted earnings per share of $1.63 were also quarterly records and increased 58 percent and 61 percent, respectively, over net income and diluted earnings per share in the 2017 third quarter. Gross profit (defined as revenue less the cost of purchased transportation and commissions to agents) in the 2018 third quarter was $171.3 million, 22 percent above the 2017 third quarter, while 2018 third quarter operating income was $87.1 million, 44 percent above the 2017 third quarter. Operating income in the 2018 third quarter was an all-time quarterly record, while gross profit was a third quarter record, second all-time only to the Company’s 2018 second quarter.

Truck transportation revenue hauled by independent business capacity owners (“BCOs”) and truck brokerage carriers in the 2018 third quarter was $1.118 billion, or 93 percent of revenue, compared to $877.6 million, or 93 percent of revenue, in the 2017 third quarter. Truckload transportation revenue hauled via van equipment in the 2018 third quarter was $717.0 million compared to $550.5 million in the 2017 third quarter. Truckload transportation revenue hauled via unsided/platform equipment in the 2018 third quarter was $375.7 million compared to $304.5 million in the 2017 third quarter. Revenue hauled by rail, air and ocean cargo carriers was $65.7 million, or 5 percent of revenue, in the 2018 third quarter compared to $53.7 million, or 6 percent of revenue, in the 2017 third quarter.

Landstar did not purchase any shares of its common stock during the 2018 third quarter. Currently, the Company is authorized to purchase up to an additional 2,000,000 shares of the Company’s common stock under Landstar’s previously announced share purchase programs. As of September 29, 2018, the Company had $254 million in cash and short term investments and $216 million available for borrowings under the Company’s senior credit facility.

In addition, Landstar announced today that its Board of Directors has declared a quarterly dividend of $0.165 per share payable on December 7, 2018, to stockholders of record as of the close of business on November 13, 2018. It is currently the intention of the Board to pay dividends on a quarterly basis going forward.

“I am extremely pleased with Landstar’s financial performance during the 2018 third quarter,” said Landstar’s President and Chief Executive Officer Jim Gattoni. “The 2018 third quarter established all-time Landstar quarterly records for revenue, operating income and diluted earnings per share while gross profit was a third quarter record. The Company also set new all-time Landstar records for trucks provided by BCOs with 10,443 as of the end of the quarter and net truck additions in a single quarter with the net addition of 288 trucks in the third quarter.”

Gattoni continued, “Demand for our services continued to be strong in the 2018 third quarter. The number of loads hauled via truck in the 2018 third quarter was a third quarter record and increased 7 percent over the 2017 third quarter, driven by a 7 percent increase in the number of loads hauled via van equipment, a 5 percent increase in the number of loads hauled via unsided/platform equipment and a 5 percent increase in less-than-truckload volume. Excluding the approximately 16,000 truckloads hauled by Landstar in September 2017 related to the storms that impacted the southeastern U.S. and Texas, truckload volumes increased 10 percent over the 2017 third quarter. The number of loads hauled via railroads, ocean cargo carriers and air cargo carriers was 25 percent higher in the 2018 third quarter compared to the 2017 third quarter, primarily due to a 21 percent increase in rail intermodal volume and a 46 percent increase in ocean volume.”

Gattoni further commented, “As expected, the pricing environment for our truckload services continued to be very strong in the 2018 third quarter, as industry-wide truck capacity continued to be tight. Revenue per load on loads hauled via van equipment increased 21 percent over the 2017 third quarter and revenue per load on loads hauled via unsided/platform equipment increased 17 percent over the 2017 third quarter. As a result, revenue per load on loads hauled via truck was 19 percent higher than the 2017 third quarter.”

Gattoni continued, “Revenue per load and the number of loads hauled via truck in the first few weeks of October continue to significantly exceed the rates and volume of the same period of 2017, however, at a more modest pace than experienced during the first three quarters of 2018. Accordingly, we expect truck revenue per load in the 2018 fourth quarter to exceed prior year fourth quarter in an upper single digit percentage range. The anticipated deceleration in the growth in truck revenue per load is the result of: 1) a more difficult quarter over prior year quarter comparison, as truck revenue per load in the 2017 fourth quarter experienced atypical significant increases on a sequential monthly basis during the quarter and 2) truck revenue per load in the first few weeks of October 2018 is trending slightly below normal seasonal patterns. The number of loads hauled via truck in the first few weeks of October is trending above the same period of 2017 in a high single digit percentage range. We expect that trend to continue and therefore expect the number of loads hauled via truck in the 2018 fourth quarter to exceed the 2017 fourth quarter in an eight to ten percent range. Assuming recent trends continue, I anticipate record revenue for the 2018 fourth quarter in a range of $1.180 billion to $1.230 billion, which would represent growth of 12 percent to 17 percent above our record 2017 fourth quarter. Assuming that range of estimated revenue and insurance and claims expense at 3.5 percent of projected BCO revenue, representing average insurance and claims costs as a percent of BCO revenue over the past five years, I would anticipate record diluted earnings per share in the 2018 fourth quarter in a range of $1.56 to $1.62. As a reminder, the 2017 fourth quarter diluted earnings per share of $1.54 included the effect of one-time tax benefits of $19.5 million, or $0.46 per diluted share, related to the Company’s reasonable estimate of the change in future tax rates on net deferred tax liabilities as a result of the enactment of the Tax Cuts and Jobs Act in December 2017.”

Landstar will provide a live webcast of its quarterly earnings conference call tomorrow morning at 8:00 a.m. 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 Third Quarter 2018 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 and expectations. Terms such as “anticipates,” “believes,” “estimates,” “intention,” “expects,” “plans,” “predicts,” “may,” “should,” “could,” “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 other claims; unfavorable development of existing accident claims; dependence on third party insurance companies; dependence on independent commission sales agents; dependence on third party capacity providers; decreased demand for transportation services; U.S. foreign trade relationships; substantial industry competition; disruptions or failures in the Company’s computer systems; cyber and other information security incidents; dependence on key vendors; changes in fuel taxes; status of independent contractors; regulatory and legislative changes; regulations focused on diesel emissions and other air quality matters; catastrophic loss of a Company facility; intellectual property; unclaimed property; and other operational, financial or legal risks or uncertainties detailed in Landstar’s Form 10K for the 2017 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 the Company undertakes no obligation to publicly update or revise any forward-looking statements.

About Landstar:
Landstar System, Inc. is a worldwide, asset-light provider of integrated transportation management solutions delivering safe, specialized transportation services to a broad range of customers utilizing a network of agents, third-party capacity providers and employees. Landstar transportation services companies are certified to ISO 9001:2015 quality management system standards and RC14001:2015 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.

            
Landstar System, Inc. and Subsidiary 
Consolidated Statements of Income 
(Dollars in thousands, except per share amounts) 
(Unaudited) 
            
            
    Thirty Nine Weeks Ended Thirteen Weeks Ended 
    September 29, September 30, September 29, September 30, 
     2018   2017   2018   2017  
            
Revenue   $3,432,793  $2,594,772  $1,202,081  $943,430  
Investment income   2,754   1,733   1,002   711  
            
Costs and expenses:          
Purchased transportation  2,658,710   1,989,938   931,473   726,827  
Commissions to agents  275,828   210,678   99,304   76,598  
Other operating costs, net of gains on asset sales/dispositions  24,176   22,497   8,966   8,097  
Insurance and claims   57,718   46,333   18,819   17,927  
Selling, general and administrative  140,948   123,179   46,699   43,995  
Depreciation and amortization  32,520   29,961   10,754   10,130  
            
Total costs and expenses  3,189,900   2,422,586   1,116,015   883,574  
            
Operating income   245,647   173,919   87,068   60,567  
Interest and debt expense   2,455   2,559   816   657  
            
Income before income taxes  243,192   171,360   86,252   59,910  
Income taxes    56,279   59,047   19,304   17,490  
            
Net income    186,913   112,313   66,948   42,420  
Less: Net loss attributable to noncontrolling interest  (112)  (23)  (37)  (23) 
Net income attributable to Landstar System,         
Inc. and subsidiary  $187,025  $112,336  $66,985  $42,443  
            
Earnings per common share attributable to         
Landstar System, Inc. and subsidiary $4.50  $2.68  $1.63  $1.01  
            
Diluted earnings per share attributable to         
Landstar System, Inc. and subsidiary $4.50  $2.67  $1.63  $1.01  
            
Average number of shares outstanding:         
Earnings per common share  41,530,000   41,924,000   41,101,000   41,957,000  
Diluted earnings per share  41,576,000   42,013,000   41,137,000   42,028,000  
            
Dividends per common share $0.465  $0.280  $0.165  $0.100  
            



Landstar System, Inc. and Subsidiary
Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
(Unaudited)
       
       
    September 29, December 30,
     2018   2017 
ASSETS      
Current assets:      
Cash and cash equivalents  $  213,974  $  242,416 
Short-term investments     40,203     48,928 
Trade accounts receivable, less allowance   
of $6,173 and $6,131     702,183     631,164 
Other receivables, including advances to independent   
contractors, less allowance of $6,188 and $6,012   18,586     24,301 
Other current assets     24,191     14,394 
Total current assets     999,137     961,203 
       
Operating property, less accumulated depreciation   
and amortization of $241,321 and $218,700   268,011     276,011 
Goodwill      38,560     39,065 
Other assets      85,004     76,181 
Total assets   $  1,390,712  $  1,352,460 
       
LIABILITIES AND EQUITY     
Current liabilities:      
Cash overdraft   $  39,759  $  42,242 
Accounts payable     313,728     285,132 
Current maturities of long-term debt    40,960     42,051 
Insurance claims     43,268     38,919 
Dividends payable     -      62,985 
Accrued compensation     23,908     30,103 
Other current liabilities     53,553     47,211 
Total current liabilities     515,176     548,643 
       
Long-term debt, excluding current maturities   72,887     83,062 
Insurance claims      30,775     30,141 
Deferred income taxes and other non-current liabilities   45,664     36,737 
       
Equity      
Landstar System, Inc. and subsidiary shareholders' equity   
Common stock, $0.01 par value, authorized 160,000,000    
shares, issued 67,869,378 and 67,740,380 shares   679     677 
Additional paid-in capital     221,563     209,599 
Retained earnings     1,779,680     1,611,158 
Cost of 26,755,001 and 25,749,493 shares of common   
stock in treasury     (1,273,512)    (1,167,600)
Accumulated other comprehensive loss   (4,569)    (3,162)
Total Landstar System, Inc. and subsidiary shareholders'   
equity      723,841     650,672 
Noncontrolling interest     2,369     3,205 
Total equity      726,210     653,877 
Total liabilities and equity   $  1,390,712  $  1,352,460 
       


Landstar System, Inc. and Subsidiary
Supplemental Information
(Unaudited)
           
           
  Thirty Nine Weeks Ended  Thirteen Weeks Ended 
  September 29, September 30,  September 29, September 30, 
   2018   2017    2018   2017  
Revenue generated through (in thousands):          
           
Truck transportation          
Truckload:          
Van equipment $  2,086,523  $  1,529,402   $  717,047  $  550,484  
Unsided/platform equipment    1,039,784     825,194      375,739     304,536  
Less-than-truckload    76,448     65,397      25,500     22,598  
Total truck transportation    3,202,755     2,419,993      1,118,286     877,618  
Rail intermodal    96,026     68,570      34,439     24,213  
Ocean and air cargo carriers    82,719     70,708      31,213     29,523  
Other (1)     51,293     35,501      18,143     12,076  
  $  3,432,793  $  2,594,772   $  1,202,081  $  943,430  
           
Revenue on loads hauled via BCO Independent Contractors (2)          
included in total truck transportation $  1,519,344  $  1,211,564   $  520,391  $  435,479  
           
Number of loads:          
           
Truck transportation          
Truckload:          
Van equipment  1,045,322   942,894    353,456   329,329  
Unsided/platform equipment  388,759   362,936    133,425   126,509  
Less-than-truckload  106,639   98,740    35,969   34,232  
Total truck transportation  1,540,720   1,404,570    522,850   490,070  
Rail intermodal  40,260   32,040    13,420   11,080  
Ocean and air cargo carriers  21,250   18,150    8,220   6,210  
   1,602,230   1,454,760    544,490   507,360  
           
Loads hauled via BCO Independent Contractors (2)          
included in total truck transportation  717,470   686,830    236,580   232,970  
           
Revenue per load:          
           
Truck transportation          
Truckload:          
Van equipment $  1,996  $  1,622   $  2,029  $  1,672  
Unsided/platform equipment    2,675     2,274      2,816     2,407  
Less-than-truckload    717     662      709     660  
Total truck transportation    2,079     1,723      2,139     1,791  
Rail intermodal    2,385     2,140      2,566     2,185  
Ocean and air cargo carriers    3,893     3,896      3,797     4,754  
           
Revenue per load on loads hauled via BCO Independent Contractors (2)$  2,118  $  1,764   $  2,200  $  1,869  
           
Revenue by capacity type (as a % of total revenue):          
           
Truck capacity providers:          
BCO Independent Contractors (2)  44%  47%   43%  46% 
Truck Brokerage Carriers  49%  47%   50%  47% 
Rail intermodal  3%  3%   3%  3% 
Ocean and air cargo carriers  2%  3%   3%  3% 
Other   1%  1%   2%  1% 
           
           
       September 29, September 30, 
        2018   2017  
Truck Capacity Providers          
           
BCO Independent Contractors (2)         9,751     8,939  
Truck Brokerage Carriers:          
  Approved and active (3)         40,151     32,925  
  Other approved         16,803     15,138  
          56,954     48,063  
Total available truck capacity providers         66,705     57,002  
           
Trucks provided by BCO Independent Contractors (2)         10,443     9,548  
           
           
(1) Includes primarily reinsurance premium revenue generated by the insurance segment and intra-Mexico transportation services revenue generated by Landstar Metro.
  
(2) BCO Independent Contractors are independent contractors who provide truck capacity to the Company under exclusive lease arrangements. 
  
(3) Active refers to Truck Brokerage Carriers who moved at least one load in the 180 days immediately preceding the fiscal quarter end.  
  
Contact: Kevin StoutLandstar System, Inc.www.landstar.com 904-398-9400

Landstar Vert Logo.jpg

Source: Landstar System, Inc.


Register |  Password |  Feedback |  Copyright |  Usage Agreement |  Privacy Policy |  Advertising |  About Us |  Contact Us |  FAQ 

Past performance is not indicative of future results

StockSelector.com, the StockSelector.com logo, and News Selects are trademarks of StockSelector.com.
Copyright © 1998 - 2019 StockSelector.com. All rights reserved.