Press Release

Hub Group, Inc. Reports Record First Quarter 2016 Earnings per Share of $0.51

OAK BROOK, Ill., April 26, 2016 /PRNewswire/ -- Hub Group, Inc. (NASDAQ: HUBG) today announced financial results for the quarter ended March 31, 2016.

Hub Group reported net income of $18.0 million for the first quarter ended March 31, 2016 compared to $10.3 million for the first quarter of 2015.  Hub Group's diluted earnings per share was $0.51 for the quarter.  Earnings per share increased 82% when compared with the prior year period.  Hub Group's pre-tax income included one-time costs of $4.1 million including $3.1 million of costs related to the closure of the Hub Group Trucking terminal in Los Angeles and $1.0 million of severance resulting from management changes.  Excluding the effect of these items, non-GAAP earnings per share was $0.58 for the quarter (see table below).  Hub Group's revenue decreased 4% to $806 million due to lower fuel revenue.

The Hub segment's revenue decreased 4% to $615 million due primarily to a decrease in fuel revenue.  First quarter intermodal revenue decreased 2% to $414 million.  Intermodal volume increased 1%.  Truck brokerage revenue decreased 9% to $81 million this quarter.  First quarter Unyson Logistics revenue decreased 10% to $120 million.  The Hub segment's operating income was $22.5 million.

The Mode segment's revenue decreased 2% to $209 million.  Operating income was $6.3 million, an increase of 24% compared to the prior year period.

Hub Group ended the quarter with $200 million in cash.

CONFERENCE CALL

Hub Group will hold a conference call at 5:00 p.m. Eastern Time on Tuesday, April 26, 2016 to discuss its first quarter results.

Hosting the conference call will be Dave Yeager, Chairman and Chief Executive Officer.  Also participating on the call will be Don Maltby, President and Chief Operating Officer, and Terri Pizzuto, Executive Vice-President and Chief Financial Officer.

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 register at http://www.yourconferencecenter.com/r.aspx?p=1&a=UWPVrIWNdEuuMN.  Registrants will be issued a passcode and PIN to use when dialing into the live call which will provide quickest access to the conference.  You may register at any time, including up to and after the call start time.  On the day of the call, dial (888) 771-4384 approximately ten minutes prior to the scheduled call time; enter the participant passcode and PIN received during registration.   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 transportation management company that provides multi-modal solutions throughout North America, including intermodal, truck brokerage and logistics services. As a publicly traded company with over $3.5 billion in revenue, Hub Group's organization of over 2,500 employees delivers innovative, customer-focused solutions and industry leading service to help customers better control supply chains and their costs.  For more information, visit www.hubgroup.com.

CERTAIN FORWARD-LOOKING STATEMENTS: Statements in this press release that are not historical, including statements about Hub Group's or management's 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'sSEC reports including, but not limited to, our annual report on Form 10-K for the year ended December 31, 2015. Hub Group assumes no liability to update any such forward-looking statements.

 

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)










Three Months




Ended March 31,




2016


2015

Revenue


$ 805,859


$ 835,941







Transportation costs

697,472


746,813


Gross margin

108,387


89,128







Costs and expenses:





Salaries and benefits

43,863


39,476


Agent fees and commissions

16,901


14,826


General and administrative

16,644


14,071


Depreciation and amortization

2,136


1,960



Total costs and expenses

79,544


70,333







Operating income

28,843


18,795







Other income (expense):





Interest expense

(911)


(741)


Interest and dividend income

61


6


Other, net 

936


(1,404)



Total other income (expense) 

86


(2,139)







Income before provision for income taxes

28,929


16,656







Provision for income taxes

10,964


6,380







Net income

$   17,965


$   10,276







Basic earnings per common share

$       0.51


$       0.28







Diluted earnings per common share

$       0.51


$       0.28







Basic weighted average number of shares outstanding

35,137


36,156

Diluted weighted average number of shares outstanding

35,122


36,169

 

HUB GROUP, INC.

UNAUDITED FINANCIAL INFORMATION BY SEGMENT

(in thousands)














Three Months




Ended March 31, 2016




Hub


Mode


Inter-Segment

Elims


Hub Group

Consolidated

Revenue

$ 615,227


$ 208,832


$              (18,200)


$              805,859











Transportation costs

536,073


179,599


(18,200)


697,472


Gross margin

79,154


29,233


-


108,387











Costs and expenses:









Salaries and benefits

40,096


3,767


-


43,863


Agent fees and commissions

13


16,888


-


16,901


General and administrative

14,722


1,922


-


16,644


Depreciation and amortization

1,815


321


-


2,136



Total costs and expenses

56,646


22,898


-


79,544











Operating income

22,508


6,335


-


28,843

 

HUB GROUP, INC.

UNAUDITED FINANCIAL INFORMATION BY SEGMENT

(in thousands)














Three Months




Ended March 31, 2015




Hub


Mode


Inter-Segment

Elims


Hub Group

Consolidated

Revenue

$ 643,443


$ 213,522


$                  (21,024)


$                  835,941











Transportation costs

580,258


187,579


(21,024)


746,813


Gross margin

63,185


25,943


-


89,128











Costs and expenses:









Salaries and benefits

35,660


3,816


-


39,476


Agent fees and commissions

15


14,811


-


14,826


General and administrative

12,198


1,873


-


14,071


Depreciation and amortization

1,618


342


-


1,960



Total costs and expenses

49,491


20,842


-


70,333











Operating income

13,694


5,101


-


18,795

 

HUB GROUP, INC.

UNAUDITED NON-GAAP TO GAAP RECONCILIATION

(earnings per share)




Three Months


Ended, March 31,




Change

Change


2016

2015

$

%






Diluted GAAP EPS

$  0.51

$  0.28

$  0.23

82.1%






Hub Group Trucking Los Angeles shutdown costs, net of tax

0.05

-

0.05







Severance costs, net of tax

0.02

0.02

-







Canadian currency translation loss, net of tax

-

0.02

(0.02)







Diluted non-GAAP EPS (adjusted)

$  0.58

$  0.32

$  0.26

81.3%






Diluted shares

35,122

36,169



 

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)






















March 31,


December 31,






2016


2015






(unaudited)



ASSETS







CURRENT ASSETS:






Cash and cash equivalents

$    200,256


$       207,749



Accounts receivable trade, net

365,149


379,987



Accounts receivable other

3,848


10,344



Prepaid taxes

336


362



Deferred taxes

-


8,412



Prepaid expenses and other current assets

16,347


17,756




TOTAL CURRENT ASSETS

585,936


624,610










Restricted investments

19,423


21,108


Property and equipment, net

379,484


374,847


Other intangibles, net

12,815


13,139


Goodwill, net

262,540


262,594


Other assets

4,448


4,848




TOTAL ASSETS

$ 1,264,646


$    1,301,146

















LIABILITIES AND STOCKHOLDERS' EQUITY





CURRENT LIABILITIES:






Accounts payable trade

$    234,196


$       230,432



Accounts payable other

23,150


21,495



Accrued payroll

14,355


33,020



Accrued other

54,469


38,733



Current portion of capital lease

2,624


2,608



Current portion of long term debt

32,524


32,409




TOTAL CURRENT LIABILITIES

361,318


358,697










Long term debt

92,648


100,895


Non-current liabilities

20,754


20,233


Long term portion of capital lease

12,640


13,299


Deferred taxes

154,039


160,182










STOCKHOLDERS' EQUITY:






Preferred stock, $.01 par value; 2,000,000 shares authorized;







no shares issued or outstanding in 2016 and 2015

-


-



Common stock







Class A: $.01 par value; 97,337,700 shares authorized and 41,224,792 shares issued in 2016 and 2015; 34,675,173 shares outstanding in 2016 and 35,633,961 shares outstanding in 2015













412


412




Class B:  $.01 par value; 662,300 shares authorized; 662,296 shares issued and outstanding in 2016 and 2015







7


7



Additional paid-in capital

166,803


174,285



Purchase price in excess of predecessor basis, net of tax






 benefit of $10,306

(15,458)


(15,458)



Retained earnings

678,723


660,758



Accumulated other comprehensive loss

(177)


(178)



Treasury stock; at cost, 6,549,619 shares in 2016







and 5,590,831 shares in 2015

(207,063)


(171,986)




TOTAL STOCKHOLDERS' EQUITY

623,247


647,840





TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$ 1,264,646


$    1,301,146

 

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)
















Three Months Ended







March 31,







2016


2015



















Cash flows from operating activities:





Net income

$        17,965


$        10,276


Adjustments to reconcile net income






to net cash provided by operating activities:







Depreciation and amortization 

10,639


8,731




Deferred taxes

2,383


1,593




Compensation expense related to share-based compensation plans

2,181


2,034




Gain on sale of assets

(83)


-




Excess tax benefits from share-based compensation

(30)


(13)


Changes in operating assets and liabilities:







Restricted investments

1,685


98




Accounts receivable, net

21,332


2,874




Prepaid taxes

26


4,557




Prepaid expenses and other current assets

1,409


(3,246)




Other assets

400


330




Accounts payable

5,421


13,414




Accrued expenses

(13,517)


5,733




Non-current liabilities

481


(1,052)






Net cash provided by operating activities

50,292


45,329










Cash flows from investing activities:





Proceeds from sale of equipment

592


26


Purchases of property and equipment

(4,893)


(15,057)





Net cash used in investing activities

(4,301)


(15,031)










Cash flows from financing activities:





Proceeds from issuance of debt

-


11,480


Repayments of long term debt

(8,132)


(5,553)


Stock tendered for payments of withholding taxes

(2,208)


(2,754)


Purchase of treasury stock

(42,368)


(13,419)


Capital lease payments

(643)


(605)


Excess tax benefits from share-based compensation

(134)


42





Net cash used in financing activities

(53,485)


(10,809)




















Effect of exchange rate changes on cash and cash equivalents

1


3










Net (decrease) increase in cash and cash equivalents

(7,493)


19,492

Cash and cash equivalents beginning of period

207,749


109,769

Cash and cash equivalents end of period

$      200,256


$      129,261

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/hub-group-inc-reports-record-first-quarter-2016-earnings-per-share-of-051-300257600.html

SOURCE Hub Group, Inc.

Maralee Volchko of Hub Group, Inc., +1-630-271-3745