Universal Truckload Services, Inc. Reports 2013 Financial Results PR Newswire WARREN, Mich., Feb. 20, 2014 WARREN, Mich., Feb. 20, 2014 /PRNewswire/ --Universal Truckload Services, Inc. (NASDAQ: UACL) today reported financial results for the year ended December 31, 2013. Net income was $50.6 million on total 2013 operating revenues of $1.03 billion. Net income in the fourth quarter of 2013 totaled $11.3 million on total operating revenue of $259.5 million, compared to $2.5 million of net income on total operating revenue of $259.1 million in the fourth quarter of 2012. In the fourth quarter of 2013, demand for value-added services grew 9.5% to $48.2 million compared to the same period last year. For the year, value-added services increased 11.5% over 2012. However, fourth quarter operating income from our logistics segment was dampened by phasing out an aerospace operation due to reductions in military spending, by additional scheduled holiday downtime by selected automotive customers compared to one year earlier, by the late-year launch of a new automotive operation, and due to an industrial customer's in-sourcing of a value-added services operation. Demand for flat bed and heavy haul transportation stabilized in recent quarters. Operating revenues from transportation services totaled $179.8 million for the fourth quarter of 2013, compared to $180.2 million for the fourth quarter of 2012, which had included above-normal, high margin business in connection with specialized wind energy shipments and to support recovery operations on the Eastern Seaboard following Hurricane Sandy. Revenues from intermodal services declined 9.7% in the fourth quarter of 2013, to $31.6 million, compared to $35.0 million one year earlier. Revenues for all of 2013 increased 9.2% to $131.4 million. However, the fourth quarter 2013 comparison to the prior year was challenging due to strong demand for intermodal services in late 2012 from an affiliated LTL carrier. Based on reported net income, earnings per basic and diluted shares were $0.38 for the fourth quarter of 2013, and $1.68 per basic and diluted shares for the full year. Income from operations increased 40.5% to $19.1 million or 7.4% of operating revenues for the fourth quarter of 2013, compared to $13.6 million or 5.3% of operating revenues for the fourth quarter of 2012. Our income before the provision for income taxes reflects $0.7 million in transaction and other costs related to our acquisition of Westport Axle Corporation on December 19, 2013. In 2012, we incurred $8.4 million in similar costs related to our acquisition of LINC Logistics Company on October 1, 2012. Excluding costs related to these actions, our income from operations decreased 9.7% to $19.9 million or 7.7% of operating revenues for the fourth quarter of 2013, compared to $22.0 million or 8.5% of operating revenues during the fourth quarter of 2012. Universal's Chief Executive Officer, Scott Wolfe commented, "Our largest customers performed well throughout 2013, and Universal's overall financial performance reflects their confidence in us. However, a harsh winter presents challenges and disruptions to the trucking industry, generally, and to the supply chain operations of our key customers. Our outlook for the next few quarters is decidedly mixed, and we are cautious about prospects for near-term growth. We will continue to invest in our enterprise sales organization, taking advantage of customer opportunities as they arise." We calculate and report 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, 2013, we held cash and cash equivalents totaling $10.2 million and marketable securities totaling $11.6 million. Outstanding debt at year end totaled $237.5 million and obligations pursuant to capital leases were valued at $4.6 million. Universal Truckload Services, Inc. also 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 3, 2014 and is expected to be paid on March 13, 2014. Conference call: We invite analysts and investors to participate in a conference call on Friday, February 21, 2014 at 10:00 AM ET, where management will discuss fourth quarter 2013 financial performance, current outlook, and trends impacting our business. Hosting the call will be Scott Wolfe, Chief Executive Officer, Don Cochran, President, and David Crittenden, CFO. Dial-in details: Call Toll Free: (866) 622-0924 International Dial-in: +1 (660) 422-4956 Conference ID: 59437360 A replay of the conference will be available two hours after the call through March 21, 2014, by calling (855) 859-2056 (toll free) or +1 (800) 585-8367 (toll) and using conference ID 59437360. Additionally, the call will be available on www.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, Mexico and Canada. 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, 2013 2012 2013 2012 Operating revenues: Transportation $ $ $ $ services 179,785 180,171 706,998 741,650 Value-added services 48,199 44,016 195,086 174,975 Intermodal services 31,564 34,961 131,408 120,381 Total operating 259,548 259,148 1,033,492 1,037,006 revenues Operating expenses: Purchased transportation and 140,434 146,563 560,024 592,493 equipment rent Direct personnel and 45,544 39,103 178,441 163,069 related benefits Commission expense 9,994 10,557 39,248 42,157 Operating expense (exclusive of items 21,442 18,372 79,263 71,117 shown separately) Occupancy expense 5,126 4,523 20,049 19,275 Selling, general and 8,601 16,806 33,046 41,159 administrative Insurance and claims 4,337 4,749 19,242 20,342 Depreciation and 4,937 4,854 19,686 18,237 amortization Total operating 240,415 245,527 948,999 967,849 expenses Income from 19,133 13,621 84,493 69,157 operations Interest expense, net (912) (1,674) (4,036) (3,983) Other non-operating 93 420 459 2,778 income Income before provision for income 18,314 12,367 80,916 67,952 taxes Provision for income 7,012 9,915 30,344 20,264 taxes Net income $ $ $ $ 11,302 2,452 50,572 47,688 Earnings per common share: Basic $ $ $ $ 0.38 0.08 1.68 1.59 Diluted $ $ $ $ 0.38 0.08 1.68 1.59 Weighted average number of common shares outstanding: Basic 30,083 30,023 30,064 30,032 Diluted 30,127 30,041 30,160 30,036 Dividends paid per $ $ $ $ common share 0.07 - 0.14 - Pre-merger dividends $ $ $ $ paid per common share - - - 1.00 Pro Forma earnings per common share - "C" corporation status: Pro Forma provision for income taxes due to LINC Logistics $ 11,059 Company conversion to "C" corporation Pro Forma net income $ 36,629 Earnings per common share: Basic $ 1.22 Diluted $ 1.22 UNIVERSAL TRUCKLOAD SERVICES, INC. Unaudited Condensed Consolidated Balance Sheets (In thousands) December 31, December 31, 2013 2012 Assets Cash and cash equivalents $ 10,223 $ 2,554 Marketable securities 11,626 9,962 Accounts receivable - net 132,001 118,903 Other current assets 49,539 37,719 Total current assets 203,389 169,138 Property and equipment - net 142,656 127,791 Other long-term assets - net 144,091 30,440 Total assets $ 490,136 $ 327,369 Liabilities and shareholders' equity Current liabilities, excluding current maturities of $ 93,896 $ 103,717 capital lease obligations and debt Capital lease obligations 4,643 - Debt 237,500 146,000 Other long-term liabilities 48,532 20,280 Total liabilities 384,571 269,997 Total shareholders' equity 105,565 57,372 Total liabilities and $ 490,136 $ 327,369 shareholders' equity UNIVERSAL TRUCKLOAD SERVICES, INC. Unaudited Summary of Operating Data Thirteen Weeks Ended Year Ended December 31, December 31, 2013 2012 2013 2012 Transportation Services: Average operating $ $ $ $ revenues per loaded mile 2.83 2.88 2.78 2.79 (a) Average operating revenues per loaded mile, excluding fuel surcharges, where $ $ $ $ separately 2.43 2.51 2.39 2.42 identifiable (a) Average operating $ $ $ $ revenues per load (a) 1,018 1,005 1,012 995 Average operating revenues per load, excluding fuel surcharges, $ $ $ $ where separately 874 873 870 863 identifiable (a) Average length of haul 360 349 364 356 (a) (b) Number of loads (a) 155,382 163,163 619,055 678,257 Value Added Services: Number of facilities (d) Customer provided 17 14 17 14 Company leased 26 27 26 27 Total 43 41 43 41 Intermodal Services: Drayage (in thousands) $ $ $ $ 27,944 25,393 109,224 97,303 Domestic Intermodal (in 1,267 7,025 12,153 12,347 thousands) Depot (in thousands) 2,353 2,543 10,031 10,731 Total (in thousands) $ $ $ $ 31,564 34,961 131,408 120,381 Average operating $ $ $ $ revenues per loaded mile 4.86 4.43 4.64 4.38 (c) Average operating revenues per loaded mile, excluding fuel surcharges, where $ $ $ $ separately 3.91 3.24 3.74 3.40 identifiable (c) Average operating $ $ $ $ revenues per load (c) 389 317 356 306 Average operating revenues per load, excluding fuel surcharges, $ $ $ $ where separately 313 232 286 238 identifiable (c) Number of loads (c) 71,744 80,038 307,116 317,837 Number of container yards 11 10 11 10 (a) Excludes operating data from Universal Logistics Solutions, Inc., Universal Logistics Solutions International, Inc., and Central Global Express, 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 operating data from Universal Logistics Solutions, Inc. in order to improve the relevance of the statistical data related to our intermodal services and improve the comparability to our peer companies. (d) 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, 2013 2012 2013 2012 Average Headcount Employees 3,741 2,492 3,449 2,484 Full time equivalents 1,764 2,273 1,786 2,182 Total 5,505 4,765 5,235 4,666 Average number of tractors Provided by 3,335 3,363 3,343 3,314 owner-operators Owned 721 665 701 640 Third party lease 127 45 80 45 Total 4,183 4,073 4,123 3,999 Operating Revenues by Segment: Transportation $ 176,182 $ 187,746 $ 705,557 $ 747,313 Logistics 83,254 71,282 327,498 289,268 Other 112 120 437 425 $ 259,548 $ 259,148 $ 1,033,492 $ 1,037,006 Income from Operations by Segment: Transportation $ 7,056 $ 8,329 $ 28,537 $ 30,623 Logistics 12,692 14,621 58,724 49,497 Other (615) (9,329) (2,768) (10,963) $ 19,133 $ 13,621 $ 84,493 $ 69,157 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 adjusted income from operations and adjusted EBITDA as supplemental measures of our performance. We define adjusted income from operations as income from operations adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance, including transaction and other costs related to our acquisitions of Westport and LINC and previous costs related to LINC's capital market activity, which was terminated in the third quarter of 2012. We define adjusted 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, further adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance, including transaction and other costs related to our acquisitions of Westport and LINC and previous costs related to LINC's capital market activity. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating adjusted income from operations and adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of adjusted income from operations and adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. 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 income from operations, the most comparable GAAP measure, to adjusted income from operations; and of net income, the most comparable GAAP measure, to EBITDA and adjusted EBITDA for each of the periods indicated: Thirteen Weeks Ended Year Ended December 31, December 31, 2013 2012 2013 2012 ( in thousands) ( in thousands) Adjusted income from operations Income from operations $ $ $ $ 19,133 13,621 84,493 69,157 Transaction and other 723 8,369 723 8,369 costs (a) Suspended capital markets - - - 1,882 activity (b) Adjusted income from $ $ $ $ operations 19,856 21,990 85,216 79,408 Operating margin (c) 7.4% 5.3% 8.2% 6.7% Adjusted operating margin 7.7% 8.5% 8.2% 7.7% (c) Adjusted EBITDA $ $ $ $ Net income 11,302 50,572 47,688 2,452 Provision for income taxes 7,012 9,915 30,344 20,264 Interest expense, net 912 1,674 4,036 3,983 Depreciation and 4,937 4,854 19,686 18,237 amortization Other non-operating income (93) (420) (459) (2,778) EBITDA 24,070 18,475 104,179 87,394 Transaction and other 723 8,369 723 8,369 costs (a) Suspended capital markets - - - 1,882 activity (b) Adjusted EBITDA $ $ $ $ 24,793 26,844 104,902 97,645 EBITDA margin (c) 9.3% 7.1% 10.1% 8.4% Adjusted EBITDA margin (c) 9.6% 10.4% 10.2% 9.4% (a) Represents transaction and other costs incurred that were directly related to the acquisitions of Westport in December 2013 and LINC in October 2012. (b) Represents expenses incurred as a result of LINC's preparations for an IPO in early 2012. When the IPO efforts were abandoned in May 2012, the costs were then taken as a charge to income. (c) Operating margin, adjusted operating margin, EBITDA margin, and adjusted EBITDA margin are computed by dividing income from operations, adjusted income from operations, EBITDA, and adjusted EBITDA, respectively, by total operating revenues for each of the periods indicated. We present adjusted income from operations and adjusted 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. Adjusted income from operations and adjusted EBITDA have limitations as an analytical tool. Some of these limitations are: oAdjusted income from operations and adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; oAdjusted income from operations and adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; oAdjusted income from operations and adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts; oAlthough depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and adjusted EBITDA does not reflect any cash requirements for such replacements; oAdjusted income from operations and adjusted EBITDA do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and oOther companies in our industry may calculate adjusted income from operations and adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure. Because of these limitations, adjusted income from operations and adjusted 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 using adjusted income from operations and adjusted EBITDA only supplementally. SOURCE Universal Truckload Services, Inc. Website: http://goutsi.com Contact: David A. Crittenden, Chief Financial Officer, DCrittenden@goutsi.com, (586) 467-1427
Universal Truckload Services, Inc. Reports 2013 Financial Results
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