8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

July 17, 2018

MARTEN TRANSPORT, LTD.

(Exact name of registrant as specified in its charter)

Delaware	0-15010	39-1140809
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

129 Marten Street Mondovi, Wisconsin	54755
(Address of principal executive offices)	(Zip Code)

(715) 926-4216

(Registrant’s telephone number, including area code)

Not applicable.

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition.

On July 17, 2018, the company issued a press release announcing financial results for the quarter ended June 30, 2018. Attached hereto as Exhibit 99.1 is a copy of the company’s press release dated July 17, 2018 announcing the company’s financial results for this period.

The press release also includes a discussion of operating revenue, net of fuel surcharge revenue; and operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharge revenue. The company provided these additional disclosures because management believes removing these items provide a more consistent basis for comparing results of operations from period to period. These financial measures in the press release have not been determined in accordance with generally accepted accounting principles (“GAAP”). Pursuant to Regulation G, the company has included a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures. For the discussion of operating revenue, net of fuel surcharge revenue; and operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharge revenue, the most directly comparable GAAP financial measures are operating revenue, and operating expenses divided by operating revenue, which are reconciled in the attached Exhibit 99.1.

The information contained in this report and the exhibit hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Section 9 – Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

(a)	Financial Statements of Businesses Acquired.
	Not Applicable.
(b)	Pro Forma Financial Information.
	Not Applicable.
(c)	Shell Company Transactions.
	Not Applicable.
(d)	Exhibits.

Exhibit No.	Description
99.1	Press Release dated July 17, 2018 (included herewith).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MARTEN TRANSPORT, LTD.
Dated: July 17, 2018	By:	/s/ James J. Hinnendael
		James J. Hinnendael
		Its: Executive Vice President and
		Chief Financial Officer

2

EX-99.1

Exhibit 99.1

               MARTEN TRANSPORT ANNOUNCES SECOND QUARTER RESULTS

MONDOVI, Wis., July 17, 2018 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported a 49.9% improvement in net income to $13.7 million, or 25 cents per diluted share, for the second quarter ended June 30, 2018, from $9.1 million, or 17 cents per diluted share, for the second quarter of 2017. The second quarter earnings improved 32.6% sequentially from 2018 first quarter net income of $10.3 million, or 19 cents per diluted share. Net income improved 38.5% to $24.0 million, or 44 cents per diluted share, for the first six months of 2018, from $17.4 million, or 32 cents per diluted share, for the first half of 2017.

Operating revenue improved 14.9% to $197.0 million for the second quarter of 2018 from $171.5 million for the second quarter of 2017, and improved 11.4% to $384.0 million for the first six months of 2018 from $344.7 million for the 2017 six-month period. Excluding fuel surcharges, operating revenue improved 8.5% to $169.2 million for the 2018 quarter from $155.9 million for the 2017 quarter, and improved 6.6% to $333.1 million for the first six months of 2018 from $312.5 million for the 2017 six-month period. Fuel surcharge revenue increased to $27.8 million for the 2018 quarter from $15.6 million for the 2017 quarter, and increased to $50.9 million for the first six months of 2018 from $32.2 million for the 2017 six-month period.

Operating expenses for the second quarter of 2018 were 90.8% of operating revenue, compared with 90.9% for the second quarter of 2017. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 89.2% for the second quarter of 2018 from 90.0% for the second quarter of 2017.

Operating expenses for the first six months of 2018 were 91.7% of operating revenue, compared with 91.4% for the 2017 six-month period. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 90.4% for the first six months of 2018 from 90.6% for the 2017 six-month period.

Chairman and Chief Executive Officer Randolph L. Marten said, “Our improved top- and bottom-line results demonstrate the balanced strength of Marten’s unique multifaceted business model, with significant increases in the operating income produced across our four distinct operating platforms – Truckload, Dedicated, Intermodal and Brokerage. With our talented people continuing to position our operations to capitalize on the strengthening freight environment, we expect to deliver continued growth with increasing compensation for our premium services, additional freight with existing and new customers, and our emphasis on operating efficiencies and cost controls.”

“Our agreements with a number of customers included a shift beginning in this year’s first quarter from line haul to fuel surcharge revenue, which reduced our Dedicated and Truckload revenue, net of fuel surcharges, by $200 and $43 per tractor per week in the second quarter, and by $155 and $28 per tractor per week in the first half of this year. The change reduced our revenue excluding fuel surcharges by $3.8 million for the second quarter and by $5.4 million for this year’s first six months, while increasing our fuel surcharge revenue by the same amounts.”

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 1,523 dry trailers operating as of June 30, 2018. 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 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, 2017. 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

(Unaudited) 

	June 30,			December 31,
(In thousands, except share information)	2018			2017
ASSETS
Current assets:
Cash and cash equivalents	$	22,003		$	15,791
Receivables:
Trade, net		80,492			74,886
Other		12,247			6,131
Prepaid expenses and other		19,876			19,810
Total current assets		134,618			116,618
Property and equipment:
Revenue equipment, buildings and land, office equipment and other		805,723			783,648
Accumulated depreciation		(218,071	)		(211,728	)
Net property and equipment		587,652			571,920
Other assets		2,169			1,865
Total assets	$	724,439		$	690,403
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	45,782		$	38,100
Insurance and claims accruals		25,574			26,177
Total current liabilities		71,356			64,277
Deferred income taxes		103,841			100,626
Total liabilities		175,197			164,903
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; 54,659,074 shares at June 30, 2018, and 54,533,455 shares at December 31, 2017, issued and outstanding		547			545
Additional paid-in capital		78,366			76,413
Retained earnings		470,329			448,542
Total stockholders’ equity		549,242			525,500
Total liabilities and stockholders’ equity	$	724,439		$	690,403

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)	2018			2017			2018			2017
Operating revenue	$	197,024		$	171,511		$	383,984		$	344,670
Operating expenses (income):
Salaries, wages and benefits		63,250			56,715			122,072			113,115
Purchased transportation		35,048			27,516			70,074			56,878
Fuel and fuel taxes		31,742			25,007			60,786			50,963
Supplies and maintenance		10,251			10,541			20,687			21,531
Depreciation		22,193			21,306			44,008			42,689
Operating taxes and licenses		2,364			2,252			4,651			4,499
Insurance and claims		8,941			8,848			19,231			17,762
Communications and utilities		1,647			1,487			3,330			3,068
Gain on disposition of revenue equipment		(2,160	)		(1,871	)		(3,371	)		(2,974	)
Other		5,525			4,141			10,699			7,632
Total operating expenses		178,801			155,942			352,167			315,163
Operating income		18,223			15,569			31,817			29,507
Other		(138	)		125			(327	)		266
Income before income taxes		18,361			15,444			32,144			29,241
Income taxes expense		4,659			6,303			8,111			11,886
Net income	$	13,702		$	9,141		$	24,033		$	17,355
Basic earnings per common share	$	0.25		$	0.17		$	0.44		$	0.32
Diluted earnings per common share	$	0.25		$	0.17		$	0.44		$	0.32
Dividends declared per common share	$	0.025		$	0.015		$	0.05		$	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)	2018			2017			2018 vs. 2017			2018 vs. 2017
Operating revenue:
Truckload revenue, net of fuel surcharge revenue	$	80,525		$	84,480		$	(3,955	)		(4.7	)%
Truckload fuel surcharge revenue		13,879			10,434			3,445			33.0
Total Truckload revenue		94,404			94,914			(510	)		(0.5	)
Dedicated revenue, net of fuel surcharge revenue		47,232			38,601			8,631			22.4
Dedicated fuel surcharge revenue		9,739			2,901			6,838			235.7
Total Dedicated revenue		56,971			41,502			15,469			37.3
Intermodal revenue, net of fuel surcharge revenue		21,291			16,877			4,414			26.2
Intermodal fuel surcharge revenue		4,179			2,238			1,941			86.7
Total Intermodal revenue		25,470			19,115			6,355			33.2
Brokerage revenue		20,179			15,980			4,199			26.3
Total operating revenue	$	197,024		$	171,511		$	25,513			14.9	%
Operating income:
Truckload	$	8,689		$	7,511		$	1,178			15.7	%
Dedicated		5,584			5,074			510			10.1
Intermodal		2,512			2,040			472			23.1
Brokerage		1,438			944			494			52.3
Total operating income	$	18,223		$	15,569		$	2,654			17.0	%
Operating ratio:
Truckload		90.8	%		92.1	%
Dedicated		90.2			87.8
Intermodal		90.1			89.3
Brokerage		92.9			94.1
Consolidated operating ratio		90.8	%		90.9	%

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)	2018			2017			2018 vs. 2017			2018 vs. 2017
Operating revenue:
Truckload revenue, net of fuel surcharge revenue	$	160,741		$	169,291		$	(8,550	)		(5.1	)%
Truckload fuel surcharge revenue		26,680			21,281			5,399			25.4
Total Truckload revenue		187,421			190,572			(3,151	)		(1.7	)
Dedicated revenue, net of fuel surcharge revenue		89,596			75,500			14,096			18.7
Dedicated fuel surcharge revenue		16,208			6,279			9,929			158.1
Total Dedicated revenue		105,804			81,779			24,025			29.4
Intermodal revenue, net of fuel surcharge revenue		42,099			33,688			8,411			25.0
Intermodal fuel surcharge revenue		8,023			4,613			3,410			73.9
Total Intermodal revenue		50,122			38,301			11,821			30.9
Brokerage revenue		40,637			34,018			6,619			19.5
Total operating revenue	$	383,984		$	344,670		$	39,314			11.4	%
Operating income:
Truckload	$	15,504		$	13,485		$	2,019			15.0	%
Dedicated		8,072			9,561			(1,489	)		(15.6	)
Intermodal		5,490			4,189			1,301			31.1
Brokerage		2,751			2,272			479			21.1
Total operating income	$	31,817		$	29,507		$	2,310			7.8	%
Operating ratio:
Truckload		91.7	%		92.9	%
Dedicated		92.4			88.3
Intermodal		89.0			89.1
Brokerage		93.2			93.3
Consolidated operating ratio		91.7	%		91.4	%

MARTEN TRANSPORT, LTD.

OPERATING STATISTICS

(Unaudited)

	Three Months						Six Months
	Ended June 30,						Ended June 30,
	2018			2017			2018			2017
Truckload Segment:
Revenue (in thousands)	$	94,404		$	94,914		$	187,421		$	190,572
Average revenue, net of fuel surcharges, per tractor per week(1)	$	3,795		$	3,467		$	3,736		$	3,441
Average tractors(1)		1,632			1,875			1,664			1,903
Average miles per trip		568			589			585			602
Non-revenue miles percentage(2)		9.6	%		9.0	%		8.2	%		9.3	%
Total miles (in thousands)		39,502			45,736			80,084			91,796
Dedicated Segment:
Revenue (in thousands)	$	56,971		$	41,502		$	105,804		$	81,779
Average revenue, net of fuel surcharges, per tractor per week(1)	$	3,282		$	3,488		$	3,275		$	3,475
Average tractors(1)		1,107			851			1,058			840
Average miles per trip		300			292			299			296
Non-revenue miles percentage(2)		0.7	%		0.7	%		0.9	%		0.7	%
Total miles (in thousands)		23,747			19,357			44,882			37,936
Intermodal Segment:
Revenue (in thousands)	$	25,470		$	19,115		$	50,122		$	38,301
Loads		10,622			9,793			21,359			19,377
Average tractors		91			81			86			79
Brokerage Segment:
Revenue (in thousands)	$	20,179		$	15,980		$	40,637		$	34,018
Loads		12,120			11,578			24,009			24,932
At June 30, 2018 and June 30, 2017:
Total tractors(1)		2,761			2,711
Average age of company tractors (in years)		1.6			1.5
Total trailers		5,402			4,925
Average age of company trailers (in years)		2.6			2.8
Ratio of trailers to tractors(1)		2.0			1.8

	Three Months						Six Months
	Ended June 30,						Ended June 30,
(In thousands)	2018			2017			2018			2017
Net cash provided by operating activities	$	44,193		$	27,546		$	67,375		$	65,220
Net cash (used for) investing activities		(31,785	)		(26,003	)		(59,177	)		(46,965	)
Net cash (used for) financing activities		(803	)		(550	)		(1,986	)		(8,685	)
Weighted average shares outstanding:
Basic		54,613			54,493			54,592			54,459
Diluted		55,126			54,802			55,115			54,772

(1)	Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 52 and 63 tractors as of June 30, 2018 and 2017, respectively.
(2)	Represents the percentage of miles for which the company is not compensated.