Marten Transport Announces Second Quarter Results - Marten Transport (NASDAQ:MRTN)

MONDOVI, Wis., July 20, 2017 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported a 7.2% increase in net income to $9.1 million, or 17 cents per diluted share, for the second quarter ended June 30, 2017, from $8.5 million, or 16 cents per diluted share, for the second quarter of 2016. Net income increased 3.8% to $17.4 million, or 32 cents per diluted share, for the first six months of 2017 from $16.7 million, or 31 cents per diluted share, for the 2016 six-month period.

Operating revenue increased to $171.5 million for the second quarter of 2017 from $166.1 million for the second quarter of 2016, and increased to $344.7 million for the first six months of 2017 from $328.0 million for the 2016 six-month period. Operating revenue, net of fuel surcharges, improved 2.0% to $155.9 million for the 2017 quarter from $152.9 million for the 2016 quarter, and improved 2.5% to $312.5 million for the 2017 six-month period from $304.8 million for the 2016 six-month period. Fuel surcharge revenue increased to $15.6 million for the 2017 quarter from $13.2 million for the 2016 quarter, and increased to $32.2 million for the first six months of 2017 from $23.3 million for the 2016 six-month period.

Operating expenses as a percentage of operating revenue improved to 90.9% for the second quarter of 2017 from 91.1% for the second quarter of 2016. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 90.0% for the second quarter of 2017 from 90.3% for the second quarter of 2016.

Operating expenses as a percentage of operating revenue was 91.4% for the 2017 six-month period and 91.2% for the 2016 six-month period. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, was 90.6% for the 2017 six-month period and 90.5% for the 2016 six-month period.

Chairman and Chief Executive Officer Randolph L. Marten said, "We are encouraged by our growth in revenue and profitability driven by our continued disciplined execution of Marten's unique multifaceted business model. Excluding the one-time facility disposition gain in our first quarter of 2015, we earned the highest net income in our history in this quarter and achieved our best operating ratio, net of fuel surcharges, over the last ten quarters. With our dedicated and experienced workforce and our diversified transportation service solutions, we are confident in our ability to capitalize on further profitable growth opportunities across all of our business units."

On July 7, 2017, we effected a five-for-three stock split of our common stock, $.01 par value, in the form of a 66 ⅔% stock dividend. Our consolidated condensed financial statements have been adjusted to give retroactive effect to the stock split for all periods presented.

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 933 dry trailers operating as of June 30, 2017. 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, 2016. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise.


MARTEN TRANSPORT, LTD. CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited)

	June 30,			December 31,
(In thousands, except share information)	2017			2016

ASSETS
Current assets:
Cash and cash equivalents	$	10,058		$	488
Receivables:
Trade, net		67,174			69,199
Other		5,657			4,436
Prepaid expenses and other		17,635			19,307
Total current assets		100,524			93,430

Property and equipment:
Revenue equipment, buildings and land, office equipment and other		775,149			759,553
Accumulated depreciation		(206,943	)		(201,728	)
Net property and equipment		568,206			557,825
Other assets		1,854			2,493
Total assets	$	670,584		$	653,748

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	46,103		$	41,230
Insurance and claims accruals		21,811			19,440
Total current liabilities		67,914			60,670
Long-term debt		-			7,886
Deferred income taxes		148,046			147,854
Total liabilities		215,960			216,410

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; 54,514,421 shares at June 30, 2017, and 54,391,525 shares at December 31, 2016, issued and outstanding		545			544
Additional paid-in capital		75,740			74,175
Retained earnings		378,339			362,619
Total stockholders' equity		454,624			437,338
Total liabilities and stockholders' equity	$	670,584		$	653,748


MARTEN TRANSPORT, LTD. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (Unaudited)

	Three Months						Six Months
	Ended June 30,						Ended June 30,
(In thousands, except per share information)	2017			2016			2017			2016

Operating revenue	$	171,511		$	166,090		$	344,670		$	328,019

Operating expenses (income):
Salaries, wages and benefits		56,715			56,196			113,115			111,026
Purchased transportation		27,516			26,187			56,878			54,222
Fuel and fuel taxes		25,007			23,930			50,963			43,560
Supplies and maintenance		10,541			10,908			21,531			21,407
Depreciation		21,306			20,368			42,689			40,415
Operating taxes and licenses		2,252			2,250			4,499			4,435
Insurance and claims		8,848			7,696			17,762			15,051
Communications and utilities		1,487			1,497			3,068			3,117
Gain on disposition of revenue equipment		(1,871	)		(2,703	)		(2,974	)		(4,137	)
Other		4,141			4,985			7,632			10,022

Total operating expenses		155,942			151,314			315,163			299,118

Operating income		15,569			14,776			29,507			28,901

Other		125			237			266			452

Income before income taxes		15,444			14,539			29,241			28,449

Provision for income taxes		6,303			6,008			11,886			11,725

Net income	$	9,141		$	8,531		$	17,355		$	16,724

Basic earnings per common share	$	0.17		$	0.16		$	0.32		$	0.31

Diluted earnings per common share	$	0.17		$	0.16		$	0.32		$	0.31

Dividends declared per common share	$	0.015		$	0.015		$	0.03		$	0.03


MARTEN TRANSPORT, LTD. SEGMENT INFORMATION (Unaudited)

							Dollar			Percentage
							Change			Change
	Three Months						Three Months			Three Months
	Ended						Ended			Ended
	June 30,						June 30,			June 30,
(Dollars in thousands)	2017			2016			2017 vs. 2016			2017 vs. 2016
Operating revenue:
Truckload revenue, net of fuel surcharge revenue	$	84,480		$	85,103		$	(623	)		(0.7	)%
Truckload fuel surcharge revenue		10,434			8,933			1,501			16.8
Total Truckload revenue		94,914			94,036			878			0.9

Dedicated revenue, net of fuel surcharge revenue		38,601			36,654			1,947			5.3
Dedicated fuel surcharge revenue		2,901			2,621			280			10.7
Total Dedicated revenue		41,502			39,275			2,227			5.7

Intermodal revenue, net of fuel surcharge revenue		16,877			16,118			759			4.7
Intermodal fuel surcharge revenue		2,238			1,664			574			34.5
Total Intermodal revenue		19,115			17,782			1,333			7.5

Brokerage revenue		15,980			14,997			983			6.6

Total operating revenue	$	171,511		$	166,090		$	5,421			3.3	%

Operating income:
Truckload	$	7,511		$	6,951		$	560			8.1	%
Dedicated		5,074			5,134			(60	)		(1.2	)
Intermodal		2,040			1,822			218			12.0
Brokerage		944			869			75			8.6
Total operating income	$	15,569		$	14,776		$	793			5.4	%

Operating ratio:
Truckload		92.1	%		92.6	%
Dedicated		87.8			86.9
Intermodal		89.3			89.8
Brokerage		94.1			94.2

Consolidated operating ratio		90.9	%		91.1	%


MARTEN TRANSPORT, LTD. SEGMENT INFORMATION (Unaudited)

							Dollar			Percentage
							Change			Change
	Six Months						Six Months			Six Months
	Ended						Ended			Ended
	June 30,						June 30,			June 30,
(Dollars in thousands)	2017			2016			2017 vs. 2016			2017 vs. 2016
Operating revenue:
Truckload revenue, net of fuel surcharge revenue	$	169,291		$	168,045		$	1,246			0.7	%
Truckload fuel surcharge revenue		21,281			16,045			5,236			32.6
Total Truckload revenue		190,572			184,090			6,482			3.5

Dedicated revenue, net of fuel surcharge revenue		75,500			72,164			3,336			4.6
Dedicated fuel surcharge revenue		6,279			4,208			2,071			49.2
Total Dedicated revenue		81,779			76,372			5,407			7.1

Intermodal revenue, net of fuel surcharge revenue		33,688			31,972			1,716			5.4
Intermodal fuel surcharge revenue		4,613			3,011			1,602			53.2
Total Intermodal revenue		38,301			34,983			3,318			9.5

Brokerage revenue		34,018			32,574			1,444			4.4

Total operating revenue	$	344,670		$	328,019		$	16,651			5.1	%

Operating income:
Truckload	$	13,485		$	13,891		$	(406	)		(2.9	)%
Dedicated		9,561			9,458			103			1.1
Intermodal		4,189			3,751			438			11.7
Brokerage		2,272			1,801			471			26.2
Total operating income	$	29,507		$	28,901		$	606			2.1	%

Operating ratio:
Truckload		92.9	%		92.5	%
Dedicated		88.3			87.6
Intermodal		89.1			89.3
Brokerage		93.3			94.5

Consolidated operating ratio		91.4	%		91.2	%


MARTEN TRANSPORT, LTD. OPERATING STATISTICS (Unaudited)

	Three Months						Six Months
	Ended June 30,						Ended June 30,
	2017			2016			2017			2016
Truckload Segment:
Revenue (in thousands)	$	94,914		$	94,036		$	190,572		$	184,090
Average revenue, net of fuel surcharges, per tractor per week⁽¹⁾	$	3,467		$	3,444		$	3,441		$	3,405
Average tractors⁽¹⁾		1,875			1,901			1,903			1,898
Average miles per trip		589			625			602			634
Non-revenue miles percentage⁽²⁾		9.0	%		9.1	%		9.3	%		9.3	%
Total miles (in thousands)		45,736			46,290			91,796			90,761

Dedicated Segment:
Revenue (in thousands)	$	41,502		$	39,275		$	81,779		$	76,372
Average revenue, net of fuel surcharges, per tractor per week⁽¹⁾	$	3,488		$	3,431		$	3,475		$	3,403
Average tractors⁽¹⁾		851			822			840			816
Average miles per trip		292			302			296			308
Non-revenue miles percentage⁽²⁾		0.7	%		0.8	%		0.7	%		0.8	%
Total miles (in thousands)		19,357			18,951			37,936			37,472

Intermodal Segment:
Revenue (in thousands)	$	19,115		$	17,782		$	38,301		$	34,983
Loads		9,793			8,755			19,377			17,451
Average tractors		81			77			79			77

Brokerage Segment:
Revenue (in thousands)	$	15,980		$	14,997		$	34,018		$	32,574
Loads		11,578			11,428			24,932			24,379

At June 30, 2017 and June 30, 2016:
Total tractors⁽¹⁾		2,711			2,785
Average age of company tractors (in years)		1.5			1.6
Total trailers		4,925			4,856
Average age of company trailers (in years)		2.8			2.7
Ratio of trailers to tractors⁽¹⁾		1.8			1.7

	Three Months						Six Months
	Ended June 30,						Ended June 30,
(In thousands)	2017			2016			2017			2016

Net cash provided by operating activities	$	27,546		$	25,086		$	65,220		$	80,151
Net cash (used for) investing activities		(26,003	)		(30,125	)		(46,965	)		(39,678	)
Net cash provided by (used for) financing activities		(550	)		4,091			(8,685	)		(40,699	)

Weighted average shares outstanding:
Basic		54,493			54,069			54,459			54,079
Diluted		54,802			54,389			54,772			54,391

(1 )		Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 63 and 77 tractors as of June 30, 2017 and 2016, respectively.

(2)		Represents the percentage of miles for which the company is not compensated.

CONTACTS: Tim Kohl, President, and Jim Hinnendael, Executive Vice President and Chief Financial Officer, of Marten Transport, Ltd., 715-926-4216.

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