hg2012q2pressrelease.htm

Exhibit 99.1

Hub Group, Inc. Reports Record Second Quarter 2012 Earnings

DOWNERS GROVE, IL, July 19, 2012, -- Hub Group, Inc. (NASDAQ: HUBG) today announced financial results for the quarter ended June 30, 2012.

Hub Group reported record net income of $16.9 million for the second quarter ended June 30, 2012, an increase of 18% compared to the second quarter of 2011. Diluted earnings per share for the second quarter of 2012 was $0.46.

Hub Group’s second quarter 2011 pre-tax income included approximately $750,000 of costs related to Mode Transportation integration and Hub’s Truck Brokerage restructuring. Excluding the effects of these costs, non-GAAP earnings per share was $0.40 for the 2011 second quarter (see table below). Earnings per share increased 15% when compared with the non-GAAP earnings per share in the prior year period.

The Hub segment’s revenue increased 6% to $596 million. Second quarter intermodal revenue increased 9% to $432 million. The increase was attributable to a 9% volume increase. Truck brokerage revenue decreased 11% to $80 million this quarter. Second quarter Unyson Logistics revenue increased 13% to $84 million. The Hub segment’s operating income was $24.9 million.

The Mode segment’s revenue increased 1% to $194 million for the second quarter. Operating income was $2.9 million.

Hub Group ended the quarter with $52 million in cash.

“Hub Group continues to execute well in a tough economic climate,” said David P. Yeager, Chairman and Chief Executive Officer.

CONFERENCE CALL

Hub will hold a conference call at 5:00 p.m. Eastern Time on Thursday, July 19, 2012 to discuss its second quarter results and outlook for the year.

Hosting the conference call will be David P. Yeager, Chairman and Chief Executive Officer, and Terri A. Pizzuto, Executive Vice-President, Chief Financial Officer and Treasurer.

This call is being webcast and can be accessed through the Investors link on Hub Group’s Web site at www.hubgroup.com. The webcast is listen-only. Those interested in participating in the question and answer session should follow the telephone dial-in instructions below.

To participate in the conference call by telephone, please call ten minutes early by dialing (888) 679-8034. The conference call participant code is 90092162. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PT6C7YLTY . Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference, bypassing the operator. The call will be limited to 60 minutes, including questions and answers.

An audio replay will be available through the Investors link on the Company's Web site at www.hubgroup.com. This replay will be available for 30 days.

ABOUT HUB GROUP: Hub Group, Inc. is a leading asset-light freight transportation management company providing comprehensive intermodal, truck brokerage and logistics services. The Company operates through a network of offices and independent agents throughout the United States, Canada and Mexico.

CERTAIN FORWARD-LOOKING STATEMENTS: Statements in this press release that are not historical, including statements about Hub Group's or management's earnings guidance, intentions, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently uncertain and subject to risks. Such statements should be viewed with caution. Actual results or experience could differ materially from the forward-looking statements as a result of many factors. Factors that could cause actual results to differ materially include the factors listed from time to time in Hub Group's SEC reports including, but not limited to, the annual report on Form 10-K for the year ended December 31, 2011 and the report on Form 10-Q for the period ended March 31, 2012. Hub Group assumes no liability to update any such forward-looking statements.

SOURCE: Hub Group, Inc.

CONTACT: Amy Lisek of Hub Group, Inc., +1-630-795-2214

HUB GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)

	Three Months						Six Months
	Ended June 30,						Ended June 30,

	2012			2011			2012			2011

Revenue	$	778,312		$	751,201		$	1,518,197		$	1,236,580
Transportation costs		690,954			666,472			1,347,097			1,094,544
Gross margin		87,358			84,729			171,100			142,036

Costs and expenses:
Salaries and benefits		31,436			32,722			64,735			59,523
Agent fees and commissions		13,601			13,765			27,296			14,516
General and administrative		12,734			12,852			25,311			24,911
Depreciation and amortization		1,737			1,472			3,397			2,408
Total costs and expenses		59,508			60,811			120,739			101,358

Operating income		27,850			23,918			50,361			40,678

Other income (expense):
Interest expense		(301	)		(69	)		(608	)		(83	)
Interest and dividend income		33			45			67			77
Other, net		(18	)		60			(41	)		269
Total other (expense) income		(286	)		36			(582	)		263

Income before provision for income taxes		27,564			23,954			49,779			40,941

Provision for income taxes		10,612			9,564			19,165			16,053

Net income	$	16,952		$	14,390		$	30,614		$	24,888


Basic earnings per common share	$	0.46		$	0.39		$	0.83		$	0.67

Diluted earnings per common share	$	0.46		$	0.39		$	0.82		$	0.67

Basic weighted average number of shares outstanding		37,070			36,901			37,057			36,893

Diluted weighted average number of shares outstanding		37,190			37,060			37,167			37,041

HUB GROUP, INC.
UNAUDITED FINANCIAL INFORMATION BY SEGMENT
(in thousands)

	Three Months									Three Months
	Ended June 30, 2012									Ended June 30, 2011
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	595,888	$	194,292	$	(11,868	)	$	778,312	$	560,418	$	193,248	$	(2,465	)	$	751,201
Transportation costs		531,080		171,742		(11,868	)		690,954		497,832		171,105		(2,465	)		666,472
Gross margin		64,808		22,550		-			87,358		62,586		22,143		-			84,729

Costs and expenses:
Salaries and benefits		27,590		3,846		-			31,436		28,111		4,611		-			32,722
Agent fees and commissions		490		13,111		-			13,601		638		13,127		-			13,765
General and administrative		10,707		2,027		-			12,734		10,264		2,588		-			12,852
Depreciation and amortization		1,099		638		-			1,737		951		521		-			1,472
Total costs and expenses		39,886		19,622		-			59,508		39,964		20,847		-			60,811

Operating income	$	24,922	$	2,928	$	-		$	27,850	$	22,622	$	1,296	$	-		$	23,918

HUB GROUP, INC.
UNAUDITED FINANCIAL INFORMATION BY SEGMENT
(in thousands)

	Six Months									Six Months
	Ended June 30, 2012									Ended June 30, 2011
					Inter-			Hub						Inter-			Hub
					Segment			Group						Segment			Group
	Hub		Mode		Elims			Total		Hub		Mode		Elims			Total
Revenue	$	1,159,100	$	381,475	$	(22,378	)	$	1,518,197	$	1,045,797	$	193,248	$	(2,465	)	$	1,236,580
Transportation costs		1,032,773		336,702		(22,378	)		1,347,097		925,904		171,105		(2,465	)		1,094,544
Gross margin		126,327		44,773		-			171,100		119,893		22,143		-			142,036

Costs and expenses:
Salaries and benefits		56,671		8,064		-			64,735		54,912		4,611		-			59,523
Agent fees and commissions		1,125		26,171		-			27,296		1,389		13,127		-			14,516
General and administrative		21,438		3,873		-			25,311		22,323		2,588		-			24,911
Depreciation and amortization		2,221		1,176		-			3,397		1,887		521		-			2,408
Total costs and expenses		81,455		39,284		-			120,739		80,511		20,847		-			101,358

Operating income	$	44,872	$	5,489	$	-		$	50,361	$	39,382	$	1,296	$	-		$	40,678

HUB GROUP, INC.
UNAUDITED NON-GAAP TO GAAP RECONCILIATION
(earnings per share)


	Three Months									Six Months
	Ended June 30,									Ended June 30,
					Change			Change						Change			Change
	2012		2011		$			%		2012		2011		$			%

Diluted GAAP EPS	$	0.46	$	0.39	$	0.07		17.9	%	$	0.82	$	0.67	$	0.15			22.4	%

Integration expenses and
restructuring costs	$	-	$	0.01	$	(0.01	)			$	-	$	0.04	$	(0.04	)

Diluted NON-GAAP EPS (adjusted)	$	0.46	$	0.40	$	0.06		15.0	%	$	0.82	$	0.71	$	0.11			15.5	%



Diluted Shares		37,190		37,060							37,167		37,041

In accordance with U.S. generally accepted accounting principles (GAAP), reported earnings per share include the after-tax impact of the items identifiable in this table. For internal purposes, Hub excludes these items from results when evaluating operating performance. This table and Hub’s internal use of non-GAAP earnings per share are not intended to imply, and should not be interpreted as implying, that non-GAAP earnings per share is a better measure of performance than GAAP earnings per share.

HUB GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)

	June 30, 2012			December 31, 2011
ASSETS	(unaudited)
CURRENT ASSETS:
Cash and cash equivalents	$	52,185		$	49,091
Accounts receivable trade, net		357,645			326,537
Accounts receivable other		22,658			23,878
Prepaid taxes		1,003			2,392
Deferred taxes		5,523			4,838
Prepaid expenses and other current assets		12,386			9,056
TOTAL CURRENT ASSETS		451,400			415,792

Restricted investments		15,436			14,323
Property and equipment, net		131,988			124,587
Other intangibles, net		20,842			21,667
Goodwill, net		263,361			263,470
Other assets		2,257			2,845
TOTAL ASSETS	$	885,284		$	842,684

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable trade	$	211,067		$	204,693
Accounts payable other		20,792			17,289
Accrued payroll		12,465			16,721
Accrued other		30,094			29,962
Current portion of capital lease		2,271			2,237
TOTAL CURRENT LIABILITIES		276,689			270,902

Non-current liabilities		18,169			17,717
Deferred taxes		96,757			91,764
Non-current portion of capital lease		22,279			23,436

STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value; 2,000,000 shares authorized; no shares issued or outstanding in 2012 and 2011		-			-
Common stock
Class A: $.01 par value; 97,337,700 shares authorized and 41,224,792 shares issued in 2012 and 2011; 37,111,252 outstanding in 2012 and 36,860,260 shares outstanding in 2011		412			412
Class B: $.01 par value; 662,300 shares authorized; 662,296 shares issued and outstanding in 2012 and 2011		7			7
Additional paid-in capital		164,459			168,800
Purchase price in excess of predecessor basis, net of tax benefit of $10,306		(15,458	)		(15,458	)
Retained earnings		431,802			401,188
Accumulated other comprehensive income		2			4
Treasury stock; at cost, 4,113,540 shares in 2012 and 4,364,532 shares in 2011		(109,834	)		(116,088	)
TOTAL STOCKHOLDERS' EQUITY		471,390			438,865
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	885,284		$	842,684

HUB GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Six Months Ended June 30,
	2012			2011
Cash flows from operating activities:
Net income	$	30,614		$	24,888
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		11,004			6,292
Deferred taxes		4,432			2,733
Compensation expense related to share-based compensation plans		3,229			2,433
Gain on sale of assets		(48	)		(8	)
Excess tax benefits from share-based compensation		(83	)		-
Changes in operating assets and liabilities, net of effect of acquisitions:
Restricted investments		(1,113	)		(1,043	)
Accounts receivable, net		(29,883	)		(62,743	)
Prepaid taxes		1,389			169
Prepaid expenses and other current assets		(3,329	)		(3,976	)
Other assets		589			305
Accounts payable		9,877			31,079
Accrued expenses		(741	)		8,445
Non-current liabilities		200			1,400
Net cash provided by operating activities		26,137			9,974

Cash flows from investing activities:
Proceeds from sale of equipment		643			214
Purchases of property and equipment		(21,043	)		(15,281	)
Cash used in acquisitions, net of cash acquired		(300	)		(90,909	)
Net cash used in investing activities		(20,700	)		(105,976	)

Cash flows from financing activities:
Proceeds from stock options exercised		45			26
Stock tendered for payments of withholding taxes		(1,770	)		(1,477	)
Capital lease payments		(1,107	)		-
Excess tax benefits from share-based compensation		492			584
Net cash used in financing activities		(2,340	)		(867	)


Effect of exchange rate changes on cash and cash equivalents		(3	)		4

Net increase (decrease) in cash and cash equivalents		3,094			(96,865	)
Cash and cash equivalents beginning of period		49,091			115,144
Cash and cash equivalents end of period	$	52,185		$	18,279