Market Overview

Marten Transport Announces Fourth Quarter and Year End Results

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MONDOVI, Wis., Jan. 23, 2020 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (NASDAQ:MRTN) today reported the highest operating revenue and operating income for any year in its history. For each of the fourth quarters ended December 31, 2019 and December 31, 2018, net income was $15.7 million, or 29 cents per diluted share. For the year ended December 31, 2019, net income improved 11.0% to $61.1 million, or $1.11 per diluted share, from $55.0 million, or $1.00 per diluted share, for 2018.

       
  Operating Results Comparison    
       
  Net income used to calculate the percentage increase from 2017 to 2018 below excludes a $56.5 million deferred income tax benefit in the fourth quarter of 2017.      
       
      Percentage   Percentage   Percentage  
      Change   Change   Change  
      Year   Year   Three Months  
      Ended   Ended   Ended  
      December 31,   December 31,   December 31,  
      2019 vs. 2018   2018 vs. 2017   2019 vs. 2018  
                       
  Operating revenue   7.1   12.8 %   6.5 %  
                       
  Operating income   8.7 %   23.7 %   (3.8 )%  
                       
  Net income   11.0 %   62.7 %   0.1 %  
     

Operating revenue improved 6.5% to $217.2 million for the fourth quarter of 2019 from $204.0 million for the fourth quarter of 2018, and improved 7.1% to a record $843.3 million for 2019 from $787.6 million for 2018. Excluding fuel surcharges, operating revenue improved 7.7% to $190.2 million for the 2019 quarter from $176.5 million for the 2018 quarter, and improved 8.6% to $739.9 million for 2019 from $681.4 million for 2018. Fuel surcharge revenue decreased slightly to $27.0 million for the 2019 quarter from $27.4 million for the 2018 quarter, and decreased to $103.4 million for 2019 from $106.2 million for 2018.

Operating income was $18.8 million for the fourth quarter of 2019, compared with $19.5 million for the fourth quarter of 2018, and improved 8.7% to a record $76.5 million for 2019 from $70.3 million for 2018.

Operating expenses as a percentage of operating revenue were 91.3% for the fourth quarter of 2019, compared with 90.4% for the fourth quarter of 2018. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 90.1% for the 2019 quarter, compared with 88.9% for the 2018 quarter.

Operating expenses as a percentage of operating revenue improved to 90.9% for 2019 from 91.1% for 2018. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 89.7% for each year.

Chairman and Chief Executive Officer Randolph L. Marten said, "Our talented people earned the highest operating revenue and operating income for any year in our history, exceeding the previous records set for each in 2018 by 7.1% and 8.7%, respectively. We overcame a softer freight environment to deliver our best operating ratio, net of fuel surcharges, over the last 14 years through the disciplined execution of our unique multifaceted business model across our diverse customer base. We added 329 Dedicated and 101 Truckload tractors throughout 2019, profitably growing the size of our fleet by 16.1% since the beginning of the year – and expect to continue to expand our capacity in 2020. We're off to a strong start with recent awards of new dedicated business with several customers for over 185 additional tractors starting in 2019's fourth and 2020's first quarters."

Marten Transport, with headquarters in Mondovi, Wis., is a multifaceted business offering a network of truck-based transportation capabilities across the Company's five distinct business platforms - Truckload, Dedicated, Intermodal, Brokerage and MRTN de Mexico. Marten 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 1,650 dry vans operating as of December 31, 2019. The Company 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 a 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, 2018. 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

    December 31,     December 31,  
(In thousands, except share information)   2019     2018  
       (Unaudited)          
ASSETS                
Current assets:                
Cash and cash equivalents   $ 31,461     $ 56,763  
Receivables:                
Trade, net     90,712       83,033  
Other     11,055       3,808  
Prepaid expenses and other     20,938       19,924  
Total current assets     154,166       163,528  
                 
Property and equipment:                
Revenue equipment, buildings and land, office equipment and other     904,237       816,430  
Accumulated depreciation     (263,843 )     (228,200 )
Net property and equipment     640,394       588,230  
Other noncurrent assets     2,026       2,146  
Total assets   $ 796,586     $ 753,904  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY                
Current liabilities:                
Accounts payable   $ 22,917     $ 15,704  
Insurance and claims accruals     31,729       28,103  
Accrued and other current liabilities     21,680       28,166  
Total current liabilities     76,326       71,973  
Deferred income taxes     122,022       105,977  
Noncurrent operating lease liabilities     649       -  
Total liabilities     198,997       177,950  
                 
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; 192,000,000 shares authorized; 54,703,466 shares at December 31, 2019, and 54,466,691 shares at December 31, 2018, issued and outstanding     547       545  
Additional paid-in capital     79,465       76,814  
Retained earnings     517,577       498,595  
Total stockholders' equity     597,589       575,954  
Total liabilities and stockholders' equity   $ 796,586     $ 753,904  
                 
                 

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

    Three Months     Year  
    Ended December 31,     Ended December 31,  
(In thousands, except per share information)     2019     2018     2019     2018  
                                 
Operating revenue   $ 217,185     $ 203,961     $ 843,271     $ 787,594  
                                 
Operating expenses (income):                                
Salaries, wages and benefits     72,707       65,924       274,156       252,047  
Purchased transportation     41,596       38,670       158,948       144,611  
Fuel and fuel taxes     31,437       29,189       121,341       121,633  
Supplies and maintenance     11,998       9,592       46,737       40,853  
Depreciation     24,842       22,305       95,137       88,585  
Operating taxes and licenses     2,678       2,418       10,100       9,473  
Insurance and claims     8,846       10,859       38,201       38,657  
Communications and utilities     1,908       1,641       7,709       6,634  
Gain on disposition of revenue equipment     (3,343 )     (2,038 )     (8,680 )     (7,244 )
Other     5,729       5,863       23,124       21,997  
                                 
     Total operating expenses     198,398       184,423       766,773       717,246  
                                 
Operating income     18,787       19,538       76,498       70,348  
                                 
Other     (262 )     (234 )     (1,190 )     (681 )
                                 
Income before income taxes     19,049       19,772       77,688       71,029  
                                 
Income taxes expense     3,301       4,035       16,617       16,002  
                                 
Net income   $ 15,748     $ 15,737     $ 61,071     $ 55,027  
                                 
Basic earnings per common share   $ 0.29     $ 0.29     $ 1.12     $ 1.01  
                                 
Diluted earnings per common share   $ 0.29     $ 0.29     $ 1.11     $ 1.00  
                                 
Dividends declared per common share   $ 0.03     $ 0.025     $ 0.77     $ 0.10  
                                 


MARTEN TRANSPORT, LTD.

SEGMENT INFORMATION
(Unaudited)

                    Dollar     Percentage  
                    Change     Change  
    Three Months     Three Months     Three Months  
    Ended     Ended     Ended  
    December 31,     December 31,     December 31,  
(Dollars in thousands)   2019     2018     2019 vs. 2018     2019 vs. 2018  
Operating revenue:                                
Truckload revenue, net of fuel surcharge revenue   $ 82,991     $ 81,020     $ 1,971       2.4 %
Truckload fuel surcharge revenue     12,278       12,979       (701 )     (5.4 )
Total Truckload revenue     95,269       93,999       1,270       1.4  
                                 
Dedicated revenue, net of fuel surcharge revenue     59,570       49,041       10,529       21.5  
Dedicated fuel surcharge revenue     11,345       10,216       1,129       11.1  
Total Dedicated revenue     70,915       59,257       11,658       19.7  
                                 
Intermodal revenue, net of fuel surcharge revenue     21,132       21,738       (606 )     (2.8 )
Intermodal fuel surcharge revenue     3,391       4,226       (835 )     (19.8 )
Total Intermodal revenue     24,523       25,964       (1,441 )     (5.5 )
                                 
Brokerage revenue     26,478       24,741       1,737       7.0  
                                 
Total operating revenue   $ 217,185     $ 203,961     $ 13,224       6.5 %
                                 
Operating income:                                
Truckload   $ 7,110     $ 9,537     $ (2,427 )     (25.4 )%
Dedicated     8,110       5,268       2,842       53.9  
Intermodal     1,472       3,153       (1,681 )     (53.3 )
Brokerage     2,095       1,580       515       32.6  
Total operating income   $ 18,787     $ 19,538     $ (751 )     (3.8 )%
                                 
Operating ratio:                                
Truckload     92.5 %     89.9 %                
Dedicated     88.6       91.1                  
Intermodal     94.0       87.9                  
Brokerage     92.1       93.6                  
Consolidated operating ratio     91.3 %     90.4 %                
 

MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)

                    Dollar     Percentage  
                    Change     Change  
    Year     Year     Year  
    Ended     Ended     Ended  
    December 31,     December 31,     December 31,  
(Dollars in thousands)   2019     2018     2019 vs. 2018     2019 vs. 2018  
Operating revenue:                                
Truckload revenue, net of fuel surcharge revenue   $ 329,304     $ 322,324     $ 6,980       2.2 %
Truckload fuel surcharge revenue     48,696       53,016       (4,320 )     (8.1 )
Total Truckload revenue     378,000       375,340       2,660       0.7  
                                 
Dedicated revenue, net of fuel surcharge revenue     223,935       187,137       36,798       19.7  
Dedicated fuel surcharge revenue     42,049       36,715       5,334       14.5  
Total Dedicated revenue     265,984       223,852       42,132       18.8  
                                 
Intermodal revenue, net of fuel surcharge revenue     77,750       85,572       (7,822 )     (9.1 )
Intermodal fuel surcharge revenue     12,644       16,453       (3,809 )     (23.2 )
Total Intermodal revenue     90,394       102,025       (11,631 )     (11.4 )
                                 
Brokerage revenue     108,893       86,377       22,516       26.1  
                                 
Total operating revenue   $ 843,271     $ 787,594     $ 55,677       7.1 %
                                 
Operating income:                                
Truckload   $ 29,666     $ 35,067     $ (5,401 )     (15.4 )%
Dedicated     31,245       18,589       12,656       68.1  
Intermodal     6,612       11,150       (4,538 )     (40.7 )
Brokerage     8,975       5,542       3,433       61.9  
Total operating income   $ 76,498     $ 70,348     $ 6,150       8.7 %
                                 
Operating ratio:                                
Truckload     92.2 %     90.7 %                
Dedicated     88.3       91.7                  
Intermodal     92.7       89.1                  
Brokerage     91.8       93.6                  
Consolidated operating ratio     90.9 %     91.1 %                
 

MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)

    Three Months     Year  
    Ended December 31,     Ended December 31,  
    2019     2018     2019     2018  
Truckload Segment:                                
Revenue (in thousands)   $ 95,269     $ 93,999     $ 378,000     $ 375,340  
Average revenue, net of fuel surcharges, per tractor per week(1)   $ 3,736     $ 3,941     $ 3,797     $ 3,833  
Average tractors(1)     1,690       1,564       1,663       1,613  
Average miles per trip     554       558       548       573  
Non-revenue miles percentage(2)     12.0 %     11.4 %     11.6 %     9.5 %
Total miles (in thousands)     39,538       36,171       155,177       153,514  
                                 
Dedicated Segment:                                
Revenue (in thousands)   $ 70,915     $ 59,257     $ 265,984     $ 223,852  
Average revenue, net of fuel surcharges, per tractor per week(1)   $ 3,286     $ 3,360     $ 3,378     $ 3,300  
Average tractors(1)     1,380       1,111       1,272       1,088  
Average miles per trip     313       321       315       309  
Non-revenue miles percentage(2)     0.6 %     0.5 %     0.7 %     0.7 %
Total miles (in thousands)     29,114       24,025       108,814       93,269  
                                 
Intermodal Segment:                                
Revenue (in thousands)   $ 24,523     $ 25,964     $ 90,394     $ 102,025  
Loads     9,731       10,493       36,309       42,425  
Average tractors     107       91       91       88  
                                 
Brokerage Segment:                                
Revenue (in thousands)   $ 26,478     $ 24,741     $ 108,893     $ 86,377  
Loads     15,690       14,314       63,200       51,104  
                                 
At December 31, 2019 and December 31, 2018:                                
Total tractors(1)     3,212       2,755                  
Average age of company tractors (in years)     1.8       1.7                  
Total trailers     5,464       5,347                  
Average age of company trailers (in years)     2.4       2.5                  
Ratio of trailers to tractors(1)     1.7       1.9                  

   

    Three Months     Year  
    Ended December 31,     Ended December 31,  
(In thousands)   2019     2018     2019     2018  
                                 
Net cash provided by operating activities   $ 33,570     $ 38,526     $ 153,180     $ 150,623  
Net cash (used for) investing activities     (41,151 )     (12,428 )     (137,229 )     (101,270 )
Net cash (used for) financing activities     (1,438     (5,074 )     (41,253 )     (8,381 )
                                 
Weighted average shares outstanding:                                
Basic     54,695       54,514       54,630       54,590  
Diluted     55,216       55,014       55,113       55,149  

       

(1 ) Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 92 and 46 tractors as of December 31, 2019 and 2018, respectively. 
   
(2 ) Represents the percentage of miles for which the company is not compensated.

 

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