- Fourth quarter 2016 Revenue:
$1.72 billion; up 6%
- Fourth quarter 2016 Operating
Income: $194.4 million; up 1%
- Fourth quarter 2016 EPS:
$1.05 vs. $1.01; up 4%
- Full Year 2016 Revenue: $6.6
billion; up 6%
- Full Year 2016 Operating Income:
$721 million; up 1%
- Full Year 2016 EPS: $3.81 vs.
$3.66; up 4%
J.B. Hunt Transport Services, Inc., (NASDAQ:JBHT) announced
fourth quarter 2016 net earnings of $117.6 million, or diluted
earnings per share of $1.05 vs. fourth quarter 2015 net earnings of
$116.7 million, or $1.01 per diluted share. Fourth quarter 2016 net
earnings included a one-time after tax benefit of $9.5 million or
$0.08 per diluted share for a change in the company’s paid time off
policy.
Total operating revenue for the current quarter was $1.72
billion, compared with $1.62 billion for the fourth quarter 2015.
Load growth of 5% in Intermodal (JBI) was the primary reason for a
3% increase in segment revenue. Dedicated Contract Services (DCS)
segment revenue increased by 8%, primarily from the addition of new
customer accounts, rate increases implemented in the current and
earlier periods and improved asset utilization. Integrated Capacity
Solutions (ICS) segment revenue increased by 22% primarily from a
38% increase in load growth. Truck (JBT) segment revenue decreased
3% primarily from customer rate per mile decreases. Current quarter
total operating revenue, excluding fuel surcharges, increased 6%
vs. the comparable quarter 2015.
Operating income for the current quarter increased to $194.4
million vs. $192.9 million for the fourth quarter 2015. The
increase primarily reflects higher revenue in JBI, DCS and ICS
business segments and a $15.2 million pre-tax, one-time benefit
recorded to reflect a change in employee paid time off policy. The
one-time benefit was partially offset with corporate charges
totaling approximately $5 million pre-tax that included charitable
contributions, employment tax audit settlements and increases to
reserves for uncollectable accounts. Continuing operational cost
increases in rail purchased transportation, wages paid to drivers,
driver and independent contractor recruiting, equipment ownership,
increased technology spending and lower gross profit margins in the
brokerage business also offset the benefits from increases in
revenue and the change in paid time off policy.
Net earnings increased to $117.6 million in the current quarter
from $116.7 million in 2015, due to the increased revenue, the paid
time off policy change benefit and a lower effective income tax
rate. The fourth quarter effective tax rates for 2016 and 2015 were
37.63% and 38.10%, respectively. The annual effective tax rates for
2016 and 2015 were 37.89% and 38.10%, respectively.
Segment Information:
Intermodal (JBI)
- Fourth quarter 2016 Segment
Revenue: $998 million; up 3%
- Fourth quarter 2016 Operating
Income: $124 million; down 3%
JBI total volumes grew 5% over the same period in 2015. Eastern
network loads were flat and transcontinental loads increased 9%
compared to the fourth quarter 2015. Revenue increased 3%,
reflecting volume growth of 5% and a 2% decrease in revenue per
load which is the combination of freight mix, customer rate
increases and fuel surcharges. Revenue per load excluding fuel
surcharges decreased approximately 2% compared to a year ago.
Operating income decreased 3% from the prior year. Benefits from
increased revenue, improved utilization and approximately $5.7
million from the change in paid time off policy were more than
offset with increases in rail purchased transportation costs,
insurance and claims costs, equipment ownership costs and driver
recruiting and retention costs. The current period ended with
approximately 84,600 units of trailing capacity and approximately
5,280 power units in the dray fleet.
Dedicated Contract Services (DCS)
- Fourth quarter 2016 Segment Revenue:
$398 million; up 8%
- Fourth quarter 2016 Operating
Income: $57.5 million; up 37%
DCS revenue increased 8% during the current quarter over the
same period 2015. Productivity (revenue per truck per week)
increased approximately 5% vs. 2015. Productivity excluding fuel
surcharge revenue increased approximately 3% from a year ago
primarily from improved integration of assets between customer
accounts, fewer unseated trucks, increased customer supply chain
fluidity and customer rate increases. A year over year net
additional 193 revenue producing trucks, 29 net additions compared
to third quarter 2016, were in the fleet by the end of the quarter.
Approximately 82% of these additions represent private fleet
conversions versus traditional dedicated capacity fleets and
primarily reflect new contract implementations in this and prior
periods. Customer retention rates remain above 98%.
Operating income increased by 37% from a year ago. The increase
in revenue, improved asset utilization and approximately $7.3
million from the change in paid time off policy were partially
offset with higher driver wages, higher driver recruiting costs and
higher equipment ownership costs compared to the same period in
2015.
Integrated Capacity Solutions (ICS)
- Fourth Quarter 2016 Segment
Revenue: $232 million; up 22%
- Fourth Quarter 2016 Operating
Income: $6.1 million; down 52%
ICS revenue increased 22% in the current quarter vs. the fourth
quarter 2015 mostly due to a 38% increase in volume offset by a 12%
decrease in revenue per load and freight mix changes driven by
customer demand. Contractual volumes represent approximately 75% of
the total load volume and 62% of the total revenue in the current
quarter compared to 73% and 62%, respectively, in fourth quarter
2015.
Operating income decreased 52% over the same period in 2015
primarily due to a lower gross profit margin, increased claim
costs, higher technology costs and increased personnel costs
partially offset with approximately $1.0 million from the change in
paid time off policy. Gross profit margin decreased to 12.9% in the
current period from 16.0% last year primarily from new customer
rates implemented during the quarter and lower spot rates compared
to the fourth quarter 2015. Total branches at the end of the period
grew to 42 from 34 at the end of the same period in 2015. ICS’s
carrier base increased 11% and the employee count increased 23%
from a year ago.
Truck (JBT)
- Fourth quarter 2016 Segment Revenue:
$ 96 million; down 3%
- Fourth quarter 2016 Operating
Income: $ 6.8 million; down 35%
JBT revenue for the current quarter decreased 3% from the same
period in 2015. Revenue excluding fuel surcharges also decreased 3%
primarily from a 3% decrease in rate per mile due to core customer
rate decreases of approximately 1.4% and freight mix changes
compared to fourth quarter 2015. At the end of the period, JBT
operated 2,128 tractors compared to 2,149 a year ago.
Operating income decreased 35% from fourth quarter 2015 levels.
Favorable changes from increased load count, fewer empty miles and
approximately $1.2 million from the change in paid time off policy
were more than offset by lower customer rates per mile, increased
equipment maintenance costs and higher safety and insurance costs
compared to fourth quarter 2015.
Cash Flow and Capitalization:
At December 31, 2016, we had total debt outstanding of $986
million on various debt instruments compared to $998 million at
December 31, 2015 and $944 million at September 30, 2016.
Our net capital expenditures for 2016 approximated $485 million
vs. $556 million in 2015. At December 31, 2016, we had cash and
cash equivalents of $6.4 million.
In the fourth quarter 2016, we purchased 880,000 shares of our
common stock for approximately $75 million. At December 31, 2016,
we had approximately $201 million remaining under our share
repurchase authorization. Actual shares outstanding at December 31,
2016 approximated 111.3 million.
This press release may contain forward-looking statements, which
are based on information currently available. Actual results may
differ materially from those currently anticipated due to a number
of factors, including, but not limited to, those discussed in Item
1A of our Annual Report filed on Form 10-K for the year ended
December 31, 2015. We assume no obligation to update any
forward-looking statement to the extent we become aware that it
will not be achieved for any reason. This press release and
additional information will be available immediately to interested
parties on our web site, www.jbhunt.com.
J.B. HUNT TRANSPORT SERVICES, INC. Condensed
Consolidated Statements of Earnings (in thousands, except per
share data) (unaudited)
Three Months Ended December 31 2016
2015 % Of % Of Amount
Revenue Amount Revenue
Operating revenues, excluding fuel surcharge revenues $ 1,558,638 $
1,472,291 Fuel surcharge revenues 162,424 148,724
Total operating revenues 1,721,062 100.0 % 1,621,015 100.0 %
Operating expenses Rents and purchased transportation 874,144 50.8
% 799,903 49.3 % Salaries, wages and employee benefits 360,190 20.9
% 363,801 22.4 % Fuel and fuel taxes 78,355 4.6 % 69,575 4.3 %
Depreciation and amortization 91,794 5.3 % 88,374 5.5 % Operating
supplies and expenses 60,001 3.5 % 56,100 3.5 % Insurance and
claims 20,026 1.2 % 17,975 1.1 % General and administrative
expenses, net of asset dispositions 25,483 1.4 % 16,051 1.0 %
Operating taxes and licenses 11,798 0.7 % 11,579 0.7 %
Communication and utilities 4,910 0.3 % 4,764 0.3 %
Total operating expenses 1,526,701 88.7 % 1,428,122
88.1 % Operating income 194,361 11.3 % 192,893 11.9 % Net interest
expense 5,876 0.3 % 4,290 0.3 % Earnings before
income taxes 188,485 11.0 % 188,603 11.6 % Income taxes
70,929 4.2 % 71,857 4.4 % Net earnings $ 117,556 6.8 % $
116,746 7.2 % Average diluted shares outstanding 112,327
115,048 Diluted earnings per share $ 1.05 $ 1.01
J.B. HUNT TRANSPORT SERVICES, INC. Condensed
Consolidated Statements of Earnings (in thousands, except per
share data) (unaudited)
Twelve Months Ended December
31 2016 2015 % Of % Of
Amount Revenue Amount
Revenue Operating revenues, excluding fuel
surcharge revenues $ 6,007,347 $ 5,516,282 Fuel surcharge revenues
548,112 671,364 Total operating revenues 6,555,459
100.0 % 6,187,646 100.0 % Operating expenses Rents and
purchased transportation 3,255,692 49.7 % 2,994,586 48.4 %
Salaries, wages and employee benefits 1,469,187 22.4 % 1,394,239
22.5 % Fuel and fuel taxes 283,437 4.3 % 313,034 5.1 % Depreciation
and amortization 361,510 5.5 % 339,613 5.5 % Operating supplies and
expenses 233,223 3.6 % 220,597 3.6 % Insurance and claims 78,410
1.2 % 73,689 1.2 % General and administrative expenses, net of
asset dispositions 87,053 1.3 % 72,522 1.1 % Operating taxes and
licenses 45,954 0.7 % 43,084 0.7 % Communication and utilities
19,973 0.3 % 20,588 0.3 % Total operating expenses
5,834,439 89.0 % 5,471,952 88.4 % Operating income
721,020 11.0 % 715,694 11.6 % Net interest expense 25,223
0.4 % 25,491 0.4 % Earnings before income taxes 695,797 10.6
% 690,203 11.2 % Income taxes 263,707 4.0 % 262,968
4.3 % Net earnings $ 432,090 6.6 % $ 427,235 6.9 % Average diluted
shares outstanding 113,361 116,728 Diluted earnings
per share $ 3.81 $ 3.66
Financial Information By Segment (in
thousands) (unaudited)
Three Months Ended December 31 2016
2015 % Of % Of Amount
Total Amount Total
Revenue
Intermodal $ 997,967 58 % $ 967,133 59 % Dedicated 398,325
23 % 368,992 23 % Integrated Capacity Solutions 231,594 13 %
189,540 12 % Truck 96,296 6 % 99,292 6
% Subtotal 1,724,182 100 % 1,624,957 100 % Intersegment
eliminations (3,120 ) (0 %) (3,942 ) (0 %)
Consolidated revenue
$ 1,721,062 100 % $ 1,621,015 100 %
Operating
income
Intermodal $ 124,143 64 % $ 127,730 66 % Dedicated 57,539 30
% 42,000 22 % Integrated Capacity Solutions 6,074 3 % 12,754 7 %
Truck 6,750 3 % 10,416 5 % Other (1) (145 ) (0 %) (7
) (0 %) Operating income $ 194,361 100 % $ 192,893
100 %
Twelve Months Ended December 31
2016 2015 % Of % Of Amount
Total Amount Total
Revenue
Intermodal $ 3,796,251 58 % $ 3,664,670 59 % Dedicated
1,533,186 23 % 1,451,256 24 % Integrated Capacity Solutions 851,550
13 % 699,525 11 % Truck 387,764 6 % 385,510
6 % Subtotal 6,568,751 100 % 6,200,961 100 % Intersegment
eliminations (13,292 ) (0 %) (13,315 ) (0 %)
Consolidated revenue $ 6,555,459 100 % $ 6,187,646
100 %
Operating
income
Intermodal $ 449,768 62 % $ 476,685 67 % Dedicated 205,240
29 % 163,511 23 % Integrated Capacity Solutions 36,260 5 % 35,729 5
% Truck 29,862 4 % 39,864 5 % Other (1) (110 ) (0 %)
(95 ) (0 %) Operating income $ 721,020 100 % $ 715,694
100 % (1) Includes corporate support activity
Operating Statistics by Segment (unaudited)
Three Months Ended December 31
2016 2015
Intermodal
Loads 491,570 467,461 Average length of haul 1,685 1,664
Revenue per load $ 2,030 $ 2,069 Average tractors during the period
* 5,274 5,088 Tractors (end of period) Company-owned 4,581
4,276 Independent contractor 695 805
Total tractors 5,276 5,081 Net change in trailing equipment
during the period 1,773 1,020 Trailing equipment (end of period)
84,594 78,957 Average effective trailing equipment usage 81,654
76,305
Dedicated
Loads 606,900 578,692 Average length of haul 181 175 Revenue
per truck per week** $ 4,247 $ 4,048 Average trucks during the
period*** 7,390 7,177 Trucks (end of period) Company-owned
6,976 6,762 Independent contractor 15 10 Customer-owned (Dedicated
operated) 410 436 Total trucks 7,401
7,208 Trailing equipment (end of period) 22,688 21,672
Average effective trailing equipment usage 23,334 22,594
Integrated
Capacity Solutions
Loads 237,845 171,887 Revenue per load $ 974 $ 1,103 Gross
profit margin 12.9 % 16.0 % Employee count (end of period) 824 670
Approximate number of third-party carriers (end of period) 50,900
45,700
Truck
Loads 96,906 95,190 Average length of haul 439 454 Loaded
miles (000) 42,476 42,749 Total miles (000) 50,472 51,437 Average
nonpaid empty miles per load 82.6 91.3 Revenue per tractor per
week** $ 3,540 $ 3,663 Average tractors during the period * 2,158
2,157 Tractors (end of period) Company-owned 1,376 1,462
Independent contractor 752 687 Total
tractors 2,128 2,149 Trailers (end of period) 7,642 7,604
Average effective trailing equipment usage 7,287 6,814 *
Includes company-owned and independent contractor tractors ** Using
weighted workdays *** Includes company-owned, independent
contractor, and customer-owned trucks
Operating Statistics by Segment (unaudited)
Twelve Months Ended December 31 2016
2015
Intermodal
Loads 1,916,303 1,772,808 Average length of haul 1,657 1,652
Revenue per load $ 1,981 $ 2,067 Average tractors during the period
* 5,222 4,949 Tractors (end of period) Company-owned 4,581
4,276 Independent contractor 695 805
Total tractors 5,276 5,081 Net change in trailing equipment
during the period 5,637 5,659 Trailing equipment (end of period)
84,594 78,957 Average effective trailing equipment usage 77,179
72,622
Dedicated
Loads 2,401,332 2,250,099 Average length of haul 177 175
Revenue per truck per week** $ 4,077 $ 4,028 Average trucks during
the period*** 7,307 7,012 Trucks (end of period)
Company-owned 6,976 6,762 Independent contractor 15 10
Customer-owned (Dedicated operated) 410 436
Total trucks 7,401 7,208 Trailing equipment (end of
period) 22,688 21,672 Average effective trailing equipment usage
22,827 22,391
Integrated
Capacity Solutions
Loads 852,179 542,947 Revenue per load $ 999 $ 1,288 Gross
profit margin 14.3 % 15.3 % Employee count (end of period) 824 670
Approximate number of third-party carriers (end of period) 50,900
45,700
Truck
Loads 385,298 366,297 Average length of haul 455 448 Loaded
miles (000) 175,038 163,115 Total miles (000) 207,998 193,856
Average nonpaid empty miles per load 85.6 83.9 Revenue per tractor
per week** $ 3,458 $ 3,698 Average tractors during the period*
2,191 2,051 Tractors (end of period) Company-owned 1,376
1,462 Independent contractor 752 687
Total tractors 2,128 2,149 Trailers (end of period) 7,642
7,604 Average effective trailing equipment usage 6,956 6,460
* Includes company-owned and independent contractor tractors **
Using weighted workdays *** Includes company-owned, independent
contractor, and customer-owned trucks
J.B. HUNT TRANSPORT SERVICES, INC. Condensed
Consolidated Balance Sheets (in thousands) (unaudited)
December 31, 2016
December 31, 2015 ASSETS Current assets: Cash and
cash equivalents $ 6,377 $ 5,566 Accounts Receivable 797,473
654,542 Prepaid expenses and other 141,831
197,817 Total current assets
945,681 857,925 Property and equipment
4,258,915 4,019,451 Less accumulated depreciation
1,440,124 1,318,122 Net property and
equipment 2,818,791
2,701,329 Other assets 64,516
70,290 $ 3,828,988 $
3,629,544
LIABILITIES & STOCKHOLDERS’
EQUITY
Current liabilities: Trade accounts payable $ 384,308 $ 340,332
Claims accruals 109,745 104,220 Accrued payroll 51,929 59,420 Other
accrued expenses 27,152
28,445 Total current liabilities 573,134
532,417 Long-term debt 986,278 998,003
Other long-term liabilities 64,881 58,552 Deferred income taxes
790,634 740,220
Stockholders’ equity
1,414,061 1,300,352
$ 3,828,988 $ 3,629,544
Supplemental Data (unaudited)
December
31, 2016 December 31, 2015 Actual
shares outstanding at end of period (000)
111,305 113,948 Book value per actual
share outstanding at end of period $ 12.70
$ 11.41
Twelve Months Ended December 31 2016
2015 Net cash provided by operating activities (000)
$ 854,143 $ 873,308 Net capital
expenditures (000) $ 485,256 $ 556,436
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version on businesswire.com: http://www.businesswire.com/news/home/20170119005150/en/
J.B. Hunt Transport Services, Inc.David G. Mee,
479-820-8363Executive Vice President, Finance/Administration and
Chief Financial Officer
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