EX-99.1 2 a08-12111_1ex99d1.htm EX-99.1

Exhibit 99.1

 

Marten Transport Announces First Quarter Results

 

MONDOVI, Wis., April 21, 2008 (PRIME NEWSWIRE) — Marten Transport, Ltd. (Nasdaq/GS:MRTN) announced today its financial and operating results for the quarter ended March 31, 2008.

 

Operating revenue, consisting of revenue from truckload and logistics operations, increased 9.1% to $143.4 million in the first quarter of 2008 from $131.4 million in the 2007 quarter. Truckload revenue increased 2.5% to $121.1 million from $118.1 million in the 2007 quarter. Logistics revenue, which consists of revenue from brokerage and intermodal operations, increased 67.6% to $22.2 million from $13.3 million in the 2007 quarter.

 

Operating revenue included fuel surcharges of $28.0 million for the first quarter of 2008, compared with $17.4 million in the 2007 quarter. Operating revenue, net of fuel surcharges, increased 1.2% to $115.4 million in the 2008 quarter from $114.0 million in the 2007 quarter.

 

For the quarter, net income was $2.7 million, or 12 cents per diluted share, compared with $4.6 million, or 21 cents per diluted share, for the same quarter of 2007.

 

Chairman, President and Chief Executive Officer Randolph L. Marten said, “The first quarter reflected the toughest operating conditions our industry has seen in recent memory.  Our continued focus on fleet management and providing excellent service to our well-established customer base, and on growing our logistics business, contributed to results that, although not satisfying, are encouraging considering the operating conditions.  With our strong capital base and continued support from our customers, we expect to weather the conditions better than most of our competitors and be well positioned when trucking demand and capacity are better aligned.

 

“We improved our average miles per tractor for the first quarter of 2008 by 1.8% over the 2007 quarter.  An increase in average miles per tractor and steady rates at $1.479 per total mile in both quarters resulted in a slight increase in our average truckload revenue per tractor per week, net of fuel surcharges, to $3,081 in the 2008 quarter from $3,059 in the 2007 quarter.  In response to the difficult freight environment, we continued to focus on the best available freight as we decreased our fleet throughout 2007.  As a result, our average fleet size was 213 tractors less in the first quarter of 2008 than in the 2007 quarter.  However, our average fleet size increased slightly from the end of 2007 to March 31, 2008.

 

“We continued to grow our logistics business in the first quarter. Logistics revenue, net of intermodal fuel surcharges, grew to $20.7 million in the first quarter, an increase of 63.2% over the 2007 quarter. Logistics revenue consists of revenue from our internal brokerage and intermodal operations and from revenue associated with our 45% interest in MW Logistics, LLC, a third-party provider of logistics services.

 

“Purchased transportation expense increased 28.3% in the 2008 quarter compared with the 2007 quarter. The growth in purchased transportation expense was primarily the result of continuing growth in our logistics business.

 

“Net fuel expense (fuel and fuel taxes less fuel surcharges, net of surcharges passed through to independent contractors) decreased $538,000, or 3.1%, quarter over quarter. The reduction was

 



 

primarily attributable to a 5.0% decrease in the number of miles driven by company drivers and to reduced idling time resulting from the installation of additional auxiliary power units in nearly 80% of our tractors at the end of the 2008 quarter.  These units provide heat, air conditioning and electrical power for our drivers without idling the tractor engine. We expect to have auxiliary power units installed in approximately 90% of our company-owned fleet by early in the third quarter of 2008. The impact of decreased miles and reduced idling time was partially offset by a significant increase in the average cost of fuel during the first quarter of 2008 to $3.38 per gallon from $2.43 per gallon in the 2007 quarter.  Net fuel expense was 17.1% of truckload and intermodal revenue, net of fuel surcharges, in the first quarter of 2008, compared with 16.8% in the 2007 quarter.

 

“Salaries, wages and benefits expense decreased 4.5% in the 2008 quarter compared with the 2007 quarter, primarily due to the reduction in our fleet size and the adoption of a per diem expense reimbursement program for our drivers. Our ratio of tractors to non-driver personnel in the 2008 quarter decreased from the 2007 quarter due to our fleet reduction and the substantial growth in our logistics business.

 

“Due to the nondeductible effect of a per diem pay structure recently initiated, our effective tax rate increased to 42.9% in the 2008 quarter from 37.8% in the 2007 quarter.

 

“Our operating ratio (operating expenses as a percentage of operating revenue) was 96.2% for the first quarter of 2008 compared with 93.6% for the first quarter of 2007.

 

“At March 31, 2008, our balance sheet reflected approximately $239.0 million in stockholders’ equity and $30.4 million in debt, for a debt-to-capitalization ratio of approximately 11.3%.”

 

Looking forward to the remainder of 2008, Mr. Marten offered the following comments: “We still expect industry-wide capacity to exceed demand at least into the second quarter of 2008. In light of those general economic assumptions, our goal is to continue to maintain our rate structure by focusing on profitable freight and strong service performance, while we aggressively control our costs.

 

“In the first quarter of 2008, we retired approximately $14.3 million in debt.  With anticipated net capital expenditures of $20 million for the remainder of 2008, we will continue to have a very strong balance sheet.  Estimated capital expenditures for the remainder of 2008 are significantly below the level of expenditures during the last several years due to 169 tractors paid-for but not placed in service as of March 31, 2008.”

 

Marten Transport, with headquarters in Mondovi, Wis., is one of the leading temperature-sensitive truckload carriers in the United States. Marten specializes in transporting food and other consumer packaged goods that require a temperature-sensitive or insulated environment. Marten offers nationwide service, 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. Such statements may be

 



 

identified by their use of terms or phrases such as “expects,” “estimates,” “projects,” “believes,” “anticipates,” “plans,” “intends,” and similar terms and phrases. Forward-looking statements are based upon the current beliefs and expectations of the Company’s management and are inherently subject to significant risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. In this release, forward-looking statements involve, among other things, our expectations concerning future performance, our ability to weather industry conditions, installation of auxiliary power units, capacity, freight demand, our ability to maintain our rate structure, and capital expenditures. The following factors, among others, could cause actual results to differ materially from those in forward-looking statements: the risk that our perception of the cyclicality of the markets we primarily serve is incorrect or there are recessionary economic cycles and downturns in customers’ business cycles; increases in the prices paid for new revenue equipment and changes in the resale value of our used equipment causing our gain on disposition to fluctuate; excess tractor or trailer capacity in the trucking industry; decreased demand for our services or loss of one or more of our major customers; our ability to maintain profitability in or continue to grow our logistics business; surplus inventories; recessionary economic cycles and downturns in customers’ business cycles; strikes, work slow downs, or work stoppages at the company, customers, ports, or other shipping related facilities; increases or rapid fluctuations in fuel prices as well as fluctuations in surcharge collection, including, but not limited to, changes in customer fuel surcharge policies and increases in fuel surcharge bases by customers;  the volume and terms of diesel purchase commitments; interest rates, fuel taxes, tolls, and license and registration fees; increased indebtedness, and associated interest expense, arising from upgrading our fleet of equipment; shortages in supply of new equipment from manufacturers; changes in management’s estimates of the need for new tractors and trailers; increases in compensation for and difficulty in attracting and retaining qualified drivers and independent contractors; elevated experience in the frequency and severity of claims relating to accident, cargo, workers’ compensation, health, and other claims; changes in management’s estimates of liability based upon such experience and development factors; increases in insurance premiums and deductible amounts; seasonal factors such as harsh weather conditions that increase operating costs; decreases in productivity that may offset or eliminate potential savings from the installation of auxiliary power units or unexpected maintenance or other costs associated with such units; competition from trucking, rail, and intermodal competitors; and regulatory requirements that increase costs or decrease efficiency, including new emissions standards for engines, the adoption of ultra-low sulfur diesel fuel and revised hours-of-service requirements for drivers, or changes in tax treatment with respect to our per diem program. Readers should review and consider these factors along with the various disclosures by the Company in its press releases, stockholder reports and filings with the Securities and Exchange Commission. The Company does not assume, and specifically disclaims, any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.

 

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

 



 

MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS

(Unaudited)

 

 

 

March 31,

 

December 31,

 

(In thousands, except share information)

 

2008

 

2007

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash

 

$

2,566

 

$

3,618

 

Marketable securities

 

320

 

350

 

Receivables:

 

 

 

 

 

Trade, net

 

54,642

 

51,539

 

Other

 

6,637

 

6,175

 

Prepaid expenses and other

 

11,870

 

13,823

 

Deferred income taxes

 

5,395

 

4,653

 

 

 

 

 

 

 

Total current assets

 

81,430

 

80,158

 

 

 

 

 

 

 

Property and equipment:

 

 

 

 

 

Revenue equipment, buildings and land, office equipment and other

 

440,750

 

447,430

 

Accumulated depreciation

 

(127,480

)

(122,246

)

 

 

 

 

 

 

Net property and equipment

 

313,270

 

325,184

 

 

 

 

 

 

 

Other assets

 

1,544

 

2,048

 

 

 

 

 

 

 

TOTAL ASSETS

 

$

396,244

 

$

407,390

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable and accrued liabilities

 

$

32,573

 

$

32,384

 

Insurance and claims accruals

 

17,597

 

17,431

 

Current maturities of long-term debt

 

5,000

 

5,000

 

 

 

 

 

 

 

Total current liabilities

 

55,170

 

54,815

 

 

 

 

 

 

 

Long-term debt, less current maturities

 

25,386

 

39,643

 

Deferred income taxes

 

75,017

 

74,719

 

 

 

 

 

 

 

Total liabilities

 

155,573

 

169,177

 

 

 

 

 

 

 

Minority interest

 

1,639

 

1,283

 

 

 

 

 

 

 

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; 48,000,000 shares authorized; 21,761,651 shares at March 31, 2008, and 21,811,837 shares at December 31, 2007, issued and outstanding 

 

218 

 

218 

 

Additional paid-in capital

 

74,019

 

74,570

 

Retained earnings

 

164,795

 

162,142

 

 

 

 

 

 

 

Total stockholders’ equity

 

239,032

 

236,930

 

 

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

396,244

 

$

407,390

 

 



 

MARTEN TRANSPORT, LTD.

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months

 

 

 

Ended March 31,

 

(In thousands, except per share information)

 

2008

 

2007

 

 

 

 

 

 

 

OPERATING REVENUE

 

$

143,374

 

$

131,416

 

 

 

 

 

 

 

OPERATING EXPENSES (INCOME):

 

 

 

 

 

Salaries, wages and benefits

 

36,682

 

38,413

 

Purchased transportation

 

28,004

 

21,820

 

Fuel and fuel taxes

 

41,929

 

32,812

 

Supplies and maintenance

 

9,332

 

8,950

 

Depreciation

 

11,962

 

11,723

 

Operating taxes and licenses

 

1,712

 

1,699

 

Insurance and claims

 

5,565

 

5,470

 

Communications and utilities

 

961

 

940

 

Gain on disposition of revenue equipment

 

(1,059

)

(1,180

)

Other

 

2,804

 

2,379

 

 

 

 

 

 

 

Total operating expenses

 

137,892

 

123,026

 

 

 

 

 

 

 

OPERATING INCOME

 

5,482

 

8,390

 

 

 

 

 

 

 

OTHER EXPENSES (INCOME):

 

 

 

 

 

Interest expense

 

534

 

1,079

 

Interest income and other

 

(77

)

(219

)

Minority interest

 

380

 

150

 

 

 

837

 

1,010

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

 

4,645

 

7,380

 

 

 

 

 

 

 

PROVISION FOR INCOME TAXES

 

1,992

 

2,786

 

 

 

 

 

 

 

NET INCOME

 

$

2,653

 

$

4,594

 

 

 

 

 

 

 

BASIC EARNINGS PER COMMON SHARE

 

$

0.12

 

$

0.21

 

 

 

 

 

 

 

DILUTED EARNINGS PER COMMON SHARE

 

$

0.12

 

$

0.21

 

 



 

MARTEN TRANSPORT, LTD.

SEGMENT INFORMATION

 

 

 

 

 

 

 

Dollar
Change

 

Percentage
Change

 

 

 

Three Months
Ended
March 31,

 

Three Months
Ended
March 31,

 

Three Months
Ended
March 31,

 

(Dollars in thousands)

 

2008

 

2007

 

2008 vs. 2007

 

2008 vs. 2007

 

Operating revenue:

 

 

 

 

 

 

 

 

 

Truckload revenue, net of fuel surcharge revenue

 

$

94,631

 

$

101,277

 

$

(6,646

)

(6.6

)%

Truckload fuel surcharge revenue

 

26,498

 

16,870

 

9,628

 

57.1

 

Total Truckload revenue

 

121,129

 

118,147

 

2,982

 

2.5

 

 

 

 

 

 

 

 

 

 

 

Logistics revenue, net of intermodal fuel surcharge revenue

 

20,745

 

12,712

 

8,033

 

63.2

 

Intermodal fuel surcharge revenue

 

1,500

 

557

 

943

 

169.3

 

Total Logistics revenue

 

22,245

 

13,269

 

8,976

 

67.6

 

 

 

 

 

 

 

 

 

 

 

Total operating revenue

 

$

143,374

 

$

131,416

 

$

11,958

 

9.1

%

 

 

 

 

 

 

 

 

 

 

Operating income:

 

 

 

 

 

 

 

 

 

Truckload

 

$

3,727

 

$

7,347

 

$

(3,620

)

(49.3

)%

Logistics

 

1,755

 

1,043

 

712

 

68.3

 

Total operating income

 

$

5,482

 

$

8,390

 

$

(2,908

)

(34.7

)%

 

 

 

 

 

 

 

 

 

 

Operating ratio:

 

 

 

 

 

 

 

 

 

Truckload

 

96.9

%

93.8

%

 

 

(3.3

)%

Logistics

 

92.1

 

92.1

 

 

 

 

Consolidated operating ratio

 

96.2

%

93.6

%

 

 

(2.8

)%

 



 

MARTEN TRANSPORT, LTD.

OPERATING STATISTICS

(Unaudited)

 

 

 

Three Months
Ended March 31,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

Truckload Segment:

 

 

 

 

 

Average truckload revenue, net of fuel surcharges, per total mile

 

$

1.479

 

$

1.479

 

Average miles per tractor(1)

 

27,082

 

26,601

 

Average truckload revenue, net of fuel surcharges, per tractor per week(1)

 

$

3,081

 

$

3,059

 

Average tractors (1)

 

2,362

 

2,575

 

Average miles per trip

 

892

 

942

 

Non-revenue miles percentage(2)

 

8.2

%

7.6

%

Total miles – company-employed drivers (in thousands)

 

54,310

 

57,168

 

Total miles – independent contractors (in thousands)

 

9,671

 

11,329

 

 

 

 

 

 

 

Logistics Segment:

 

 

 

 

 

Brokerage:

 

 

 

 

 

Revenue (in thousands)

 

$

15,224

 

$

9,049

 

Loads

 

7,613

 

4,748

 

Intermodal:

 

 

 

 

 

Revenue (in thousands)

 

$

7,021

 

$

4,220

 

Loads

 

2,153

 

1,386

 

Average tractors

 

40

 

24

 

 

 

 

 

 

 

At March 31, 2008, and March 31, 2007:

 

 

 

 

 

Total tractors(1)

 

2,420

 

2,591

 

Average age of company tractors (in years)

 

2.2

 

1.6

 

Total trailers

 

4,032

 

3,903

 

Average age of company trailers (in years)

 

2.7

 

2.2

 

Ratio of trailers to tractors(1)

 

1.7

 

1.5

 

Ratio of tractors to non-driver personnel(1)

 

5.1

 

5.5

 

 

 

 

Three Months
Ended March 31,

 

(In thousands)

 

2008

 

2007

 

 

 

 

 

 

 

Net cash provided by operating activities

 

$

14,739

 

$

16,838

 

Net cash used for investing activities

 

867

 

27,900

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

Basic

 

21,757

 

21,766

 

Diluted

 

21,903

 

21,951

 

 


(1)

Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 295 and 367 tractors as of March 31, 2008, and 2007, respectively.

 

 

(2)

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