hubg-10qa_20170930.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 10-Q/A

(Amendment No. 1)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2017 or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from           to          

Commission file number:  0-27754

 

HUB GROUP, INC.

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

36-4007085

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

2000 Clearwater Drive

Oak Brook, Illinois 60523

(Address, including zip code, of principal executive offices)

(630) 271-3600

(Registrant’s telephone number, including area code)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company.  See definition of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.  (Check one):

Large Accelerated Filer

 

Accelerated Filer

 

Non-Accelerated Filer

 

Smaller Reporting Company

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.   

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

On October 26, 2017, the registrant had 33,451,445 outstanding shares of Class A common stock, par value $.01 per share, and 662,296 outstanding shares of Class B common stock, par value $.01 per share.

 


 

Explanatory Note

 

Hub Group, Inc. is filing this Amendment No. 1 to its Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 (“Form 10-Q”) to add a date to the Section 906 certification in Exhibit 32.1.

 

 

 

 


 

HUB GROUP, INC.

INDEX

 

 

Page

PART I.  Financial Information:

 

Consolidated Balance Sheets – September 30, 2017 (unaudited) and December 31, 2016

4

Unaudited Consolidated Statements of Income and Comprehensive Income – Three Months and Nine Months Ended September 30, 2017 and 2016

5

Unaudited Consolidated Statements of Cash Flows – Nine Months Ended September 30, 2017 and 2016

6

Notes to Unaudited Consolidated Financial Statements

7

Management’s Discussion and Analysis of Financial Condition and Results of Operations

17

Quantitative and Qualitative Disclosures about Market Risk

26

Controls and Procedures

26

PART II.  Other Information

26

 

 

 

 

3


 

HUB GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

 

September 30,

 

 

December 31,

 

 

2017

 

 

2016

 

ASSETS

(unaudited)

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

 

Cash and cash equivalents

$

18,558

 

 

$

127,404

 

Accounts receivable trade, net

 

532,538

 

 

 

473,608

 

Accounts receivable other

 

10,017

 

 

 

4,331

 

Prepaid taxes

 

12,134

 

 

 

294

 

Prepaid expenses and other current assets

 

21,216

 

 

 

16,653

 

TOTAL CURRENT ASSETS

 

594,463

 

 

 

622,290

 

 

 

 

 

 

 

 

 

Restricted investments

 

24,066

 

 

 

20,877

 

Property and equipment, net

 

547,881

 

 

 

438,594

 

Other intangibles, net

 

75,772

 

 

 

11,844

 

Goodwill, net

 

348,506

 

 

 

262,376

 

Other assets

 

9,175

 

 

 

4,278

 

TOTAL ASSETS

$

1,599,863

 

 

$

1,360,259

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

Accounts payable trade

$

313,511

 

 

$

266,555

 

Accounts payable other

 

30,115

 

 

 

21,070

 

Accrued payroll

 

25,245

 

 

 

36,223

 

Accrued other

 

53,609

 

 

 

46,013

 

Current portion of capital lease

 

2,754

 

 

 

2,697

 

Current portion of long term debt

 

73,052

 

 

 

45,163

 

TOTAL CURRENT LIABILITIES

 

498,286

 

 

 

417,721

 

 

 

 

 

 

 

 

 

Long term debt

 

214,032

 

 

 

115,529

 

Non-current liabilities

 

29,181

 

 

 

23,595

 

Long term portion of capital lease

 

8,418

 

 

 

10,576

 

Deferred taxes

 

182,464

 

 

 

164,659

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY:

 

 

 

 

 

 

 

Preferred stock, $.01 par value;  2,000,000 shares authorized;  no shares issued or outstanding in 2017 and 2016

-

 

 

-

 

Common stock

 

 

 

 

 

 

 

Class A:  $.01 par value;  97,337,700 shares authorized and 41,224,792 shares issued in 2017 and 2016; 33,451,445 shares outstanding in 2017 and 33,192,982 shares outstanding in 2016

 

412

 

 

 

412

 

Class B:  $.01 par value; 662,300 shares authorized; 662,296 shares issued and outstanding in 2017 and 2016

 

7

 

 

 

7

 

Additional paid-in capital

 

170,355

 

 

 

173,565

 

Purchase price in excess of predecessor basis, net of tax benefit of $10,306

 

(15,458

)

 

 

(15,458

)

Retained earnings

 

770,773

 

 

 

735,563

 

Accumulated other comprehensive loss

 

(172

)

 

 

(273

)

Treasury stock; at cost, 7,773,347 shares in 2017 and 8,031,810 shares in 2016

 

(258,435

)

 

 

(265,637

)

TOTAL STOCKHOLDERS' EQUITY

 

667,482

 

 

 

628,179

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

1,599,863

 

 

$

1,360,259

 

See notes to unaudited consolidated financial statements.

 

 

 

4


 

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

AND COMPREHENSIVE INCOME

(in thousands, except per share amounts)

 

 

Three Months

 

 

Nine Months

 

 

Ended September 30,

 

 

Ended September 30,

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

1,054,360

 

 

$

932,814

 

 

$

2,872,321

 

 

$

2,594,230

 

Transportation costs

 

937,836

 

 

 

821,360

 

 

 

2,552,895

 

 

 

2,259,899

 

Gross margin

 

116,524

 

 

 

111,454

 

 

 

319,426

 

 

 

334,331

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

49,126

 

 

 

42,610

 

 

 

137,343

 

 

 

130,075

 

Agent fees and commissions

 

19,072

 

 

 

19,072

 

 

 

54,103

 

 

 

54,334

 

General and administrative

 

22,403

 

 

 

17,641

 

 

 

63,341

 

 

 

50,368

 

Depreciation and amortization

 

4,254

 

 

 

2,276

 

 

 

9,215

 

 

 

6,559

 

Total costs and expenses

 

94,855

 

 

 

81,599

 

 

 

264,002

 

 

 

241,336

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

21,669

 

 

 

29,855

 

 

 

55,424

 

 

 

92,995

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

(2,345

)

 

 

(888

)

 

 

(4,474

)

 

 

(2,655

)

Interest and dividend income

 

58

 

 

 

104

 

 

 

388

 

 

 

286

 

Other, net

 

404

 

 

 

27

 

 

 

597

 

 

 

1,178

 

Total other expense

 

(1,883

)

 

 

(757

)

 

 

(3,489

)

 

 

(1,191

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before provision for income taxes

 

19,786

 

 

 

29,098

 

 

 

51,935

 

 

 

91,804

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

4,452

 

 

 

11,174

 

 

 

16,725

 

 

 

35,243

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$

15,334

 

 

$

17,924

 

 

$

35,210

 

 

$

56,561

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

9

 

 

 

(10

)

 

 

101

 

 

 

(63

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income

$

15,343

 

 

$

17,914

 

 

$

35,311

 

 

$

56,498

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per common share

$

0.46

 

 

$

0.54

 

 

$

1.06

 

 

$

1.66

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share

$

0.46

 

 

$

0.54

 

 

$

1.06

 

 

$

1.66

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic weighted average number of shares outstanding

 

33,227

 

 

 

33,212

 

 

 

33,217

 

 

 

34,098

 

Diluted weighted average number of shares outstanding

 

33,335

 

 

 

33,366

 

 

 

33,323

 

 

 

34,172

 

 

See notes to unaudited consolidated financial statements.

 

 

 

 

5


 

HUB GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

 

 

Nine Months Ended September 30,

 

 

2017

 

 

2016

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

$

35,210

 

 

$

56,561

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

43,531

 

 

 

32,665

 

Deferred taxes

 

19,983

 

 

 

13,269

 

Compensation expense related to share-based compensation plans

 

7,402

 

 

 

6,318

 

Loss (gain) on sale of assets

 

360

 

 

 

(382

)

Excess tax benefits from share based compensation

 

-

 

 

 

(524

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Restricted investments

 

(3,189

)

 

 

545

 

Accounts receivable, net

 

(37,448

)

 

 

(62,324

)

Prepaid taxes

 

(11,839

)

 

 

(1,609

)

Prepaid expenses and other current assets

 

(3,059

)

 

 

1,244

 

Other assets

 

(3,505

)

 

 

961

 

Accounts payable

 

51,459

 

 

 

37,080

 

Accrued expenses

 

(13,179

)

 

 

(6,968

)

Non-current liabilities

 

1,419

 

 

 

2,181

 

Net cash provided by operating activities

 

87,145

 

 

 

79,017

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Proceeds from sale of equipment

 

3,052

 

 

 

1,573

 

Purchases of property and equipment

 

(39,936

)

 

 

(59,883

)

Acquisitions, net of cash acquired

 

(165,933

)

 

 

-

 

Net cash used in investing activities

 

(202,817

)

 

 

(58,310

)

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Proceeds from issuance of debt

 

73,606

 

 

 

36,100

 

Repayments of long term debt

 

(59,921

)

 

 

(25,074

)

Stock tendered for payments of withholding taxes

 

(3,410

)

 

 

(2,484

)

Purchase of treasury stock

 

-

 

 

 

(100,000

)

Capital lease payments

 

(2,101

)

 

 

(1,965

)

Excess tax benefits from share-based compensation

 

-

 

 

 

212

 

Payment of debt issuance costs

 

(1,397

)

 

 

-

 

Net cash provided by (used in) financing activities

 

6,777

 

 

 

(93,211

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

49

 

 

 

(50

)

 

 

 

 

 

 

 

 

Net decrease in cash and cash equivalents

 

(108,846

)

 

 

(72,554

)

Cash and cash equivalents beginning of the period

 

127,404

 

 

 

207,749

 

Cash and cash equivalents end of the period

$

18,558

 

 

$

135,195

 

 

 

 

 

 

 

 

 

Supplemental disclosures of cash paid for:

 

 

 

 

 

 

 

Interest

$

4,033

 

 

$

2,636

 

Income taxes

$

12,880

 

 

$

26,826

 

See notes to unaudited consolidated financial statements.

 

 

 

6


 

HUB GROUP, INC.

NOTES TO UNAUDITED

CONSOLIDATED FINANCIAL STATEMENTS

 

 

NOTE 1.

Interim Financial Statements

Our accompanying unaudited consolidated financial statements of Hub Group, Inc. (“we”, “us” or “our”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in annual financial statements have been omitted pursuant to those rules and regulations.  However, we believe that the disclosures contained herein are adequate to make the information presented not misleading.

The financial statements reflect, in our opinion, all material adjustments (which include only normal recurring adjustments) necessary to fairly present our financial position as of September 30, 2017 and results of operations for the three and nine months ended September 30, 2017 and 2016.

These unaudited consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2016.  Results of operations in interim periods are not necessarily indicative of results to be expected for a full year due partially to seasonality.

 

 

NOTE 2.

Acquisition  

Hub Group Trucking (HGT), a wholly owned subsidiary of Hub Group, Inc., acquired all of the outstanding equity interests of Estenson Logistics, LLC (“Estenson”) on July 1, 2017 (the “Estenson Acquisition”).  Estenson is now our wholly owned subsidiary, operating under the name Hub Group Dedicated (“HGD”).  As a result of the Estenson Acquisition, HGT acquired substantially all of the assets of Estenson, which include tractors and trailers, as well as assumed certain liabilities, including equipment debt.  HGD is included in the Hub segment.

HGD has an operating fleet of approximately 1,000 tractors and over 3,600 trailers.  Dedicated services have been requested by our customers and we believe HGD is an excellent service offering that we can provide to our customers.

The base purchase price for Estenson was approximately $285 million, including contingent consideration related to an earn-out provision included in the Purchase Agreement, which will not exceed $6 million and is based on Estenson’s EBITDA results through June 30, 2019.  In accordance with the agreement, the base purchase price was adjusted by the assumed debt to arrive at the final consideration of $172 million.  To facilitate the acquisition, we assumed $113 million of Estenson debt and paid $166 million in cash, including $55 million of cash, which was borrowed under our new line of credit (See Note 6).

The following table summarizes the total purchase price allocated to the net assets acquired (in thousands):

 

 

 

 

Cash paid

$

165,945

 

Consideration payable

 

1,366

 

Contingent consideration, fair value

 

4,703

 

Total consideration

 

172,014

 

Equipment debt assumed

 

112,677

 

Total base purchase price

$

284,691

 

Pending finalization of the fair market value of assets acquired and liabilities assumed, revenue and lease contracts, and deferred taxes related to tax valuation/tax goodwill the measurement period remains open.  The following table summarizes the preliminary allocation of the total consideration to the assets acquired and liabilities assumed as of the date of the acquisition (in thousands):

 

7


 

 

 

July 1, 2017

 

Cash and cash equivalents

$

12

 

Accounts receivable trade

 

27,000

 

Accounts receivable other

 

165

 

Prepaid expenses and other current assets

 

1,500

 

Property and equipment

 

128,477

 

Other intangibles

 

66,400

 

Goodwill

 

86,294

 

Other assets

 

64

 

Total assets acquired

$

309,912

 

 

 

 

 

Accounts payable trade

$

4,542

 

Accrued payroll

 

5,661

 

Accrued other

 

15,018

 

Equipment debt

 

112,677

 

Total liabilities assumed

$

137,898

 

 

 

 

 

Total consideration

$

172,014

 

The Estenson acquisition was accounted for as a purchase business combination in accordance with ASC 805 “Business Combinations.” Assets acquired and liabilities assumed were recorded in the accompanying consolidated balance sheet at their estimated fair values as of July 1, 2017 with the remaining unallocated purchase price recorded as goodwill. The goodwill recognized in the Estenson acquisition was primarily attributable to potential expansion and future development of the acquired business.  The fair value assigned to the customer relationships identifiable intangible was determined using an income approach based on management’s estimates and assumptions. The fair value assigned to the property and equipment was determined based on a market approach. A probability weighted expected return model was used to estimate the value of the contingent consideration.  Equipment debt was valued using a discounted cash flow analysis whereby future contractual principal repayments and interest payments for each instrument were discounted to the purchase date at a risk-adjusted discount rate.

We incurred approximately $1.6 million of acquisition costs associated with this transaction prior to the closing date that are reflected in general and administrative expense in the Unaudited Consolidated Statements of Income for the nine months ended September 30, 2017.

The components of “Other intangibles” listed in the above table as of the acquisition date are preliminarily estimated as follows (in thousands):

 

 

 

 

 

 

 

Accumulated

 

 

Balance at

 

 

Estimated Useful

 

 

Amount

 

 

Amortization

 

 

September 30, 2017

 

 

Life

Customer relationships

 

$

66,000

 

 

$

1,100

 

 

$

64,900

 

 

15 years

Trade name

 

 

400

 

 

 

400

 

 

-

 

 

3 months

The above intangible assets are amortized using the straight-line method.  Amortization expense related to this acquisition for both the three and nine month periods ended September 30, 2017 was $1.5 million.  The intangible assets have a weighted average useful life of approximately 15 years.  Amortization expense related to HGD for the next five years is as follows (in thousands):

 

Remainder 2017

 

$

1,100

 

2018

 

 

4,400

 

2019

 

 

4,400

 

2020

 

 

4,400

 

2021

 

 

4,400

 

 

8


 

 

The following unaudited pro forma consolidated results of operations for 2017 and 2016 assume that the acquisition of Estenson was completed as of January 1, 2016 (in thousands, except for per share amounts):

 

 

 

 

Three Months

 

 

 

 

Ended

 

 

 

 

September 30, 2016

 

Revenue

 

 

$

988,345

 

Net income

 

 

$

20,249

 

Earnings per share

 

 

 

 

 

Basic

 

 

$

0.61

 

Diluted

 

 

$

0.61

 

 

 

Nine Months

 

 

Nine Months

 

 

Ended

 

 

Ended

 

 

September 30, 2017

 

 

September 30, 2016

 

Revenue

$

2,986,342

 

 

$

2,752,660

 

Net income

$

39,387

 

 

$

62,212

 

Earnings per share

 

 

 

 

 

 

 

Basic

$

1.19

 

 

$

1.82

 

Diluted

$

1.18

 

 

$

1.82

 

The unaudited pro forma consolidated results for the three and nine month periods were prepared using the acquisition method of accounting and are based on the historical financial information of Hub and HGD. The historical financial information has been adjusted to give effect to the pro forma adjustments that are: (i) directly attributable to the acquisition, (ii) factually supportable and (iii) expected to have a continuing impact on the combined results. The unaudited pro forma consolidated results are not necessarily indicative of what our consolidated results of operations actually would have been had we completed the acquisition on January 1, 2016.

 

NOTE 3.

Business Segments

We report two distinct business segments.  The first segment is Mode, which includes the Mode Transportation, LLC (“Mode LLC”) business we acquired on April 1, 2011.  The second segment is Hub, which is all business other than Mode.

Hub offers comprehensive intermodal, truck brokerage, dedicated and logistics services.  Our employees operate the freight through a network of operating centers located in the United States, Canada and Mexico.  Each operating center is strategically located in a market with a significant concentration of shipping customers and one or more railheads.  Hub has full time employees located throughout the United States, Canada and Mexico.

Mode LLC has Independent Business Owners (“IBOs”) who sell and operate the business throughout North America, as well as sales only agents.  Mode LLC also has a corporate office in Dallas, TX, a temperature protected services division, Temstar, located in Oak Brook, IL and corporate offices in Memphis, TN.

Mode LLC markets and operates its freight transportation services, consisting of intermodal, truck brokerage and logistics, primarily through agents who enter into contractual arrangements with Mode LLC.

 

9


 

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

 

 

Three Months

 

 

Three Months

 

 

Ended September 30, 2017

 

 

Ended September 30, 2016

 

 

 

 

 

 

 

 

Inter-

 

Hub

 

 

 

 

 

 

 

 

Inter-

 

Hub

 

 

 

 

 

 

 

 

Segment

 

Group

 

 

 

 

 

 

 

 

Segment

 

Group

 

 

Hub

 

Mode

 

Elims

 

Total

 

 

Hub

 

Mode

 

Elims

 

Total

 

Revenue

$

820,802

 

$

258,696

 

$

(25,138

)

$

1,054,360

 

 

$

716,699

 

$

251,611

 

$

(35,496

)

$

932,814

 

Transportation costs

 

734,747

 

 

228,227

 

 

(25,138

)

 

937,836

 

 

 

638,154

 

 

218,702

 

 

(35,496

)

 

821,360

 

Gross margin

 

86,055

 

 

30,469

 

 

-

 

 

116,524

 

 

 

78,545

 

 

32,909

 

 

-

 

 

111,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

45,727

 

 

3,399

 

 

-

 

 

49,126

 

 

 

38,775

 

 

3,835

 

 

-

 

 

42,610

 

Agent fees and commissions

 

15

 

 

19,057

 

 

-

 

 

19,072

 

 

 

20

 

 

19,052

 

 

-

 

 

19,072

 

General and administrative

 

20,520

 

 

1,883

 

 

-

 

 

22,403

 

 

 

15,969

 

 

1,672

 

 

-

 

 

17,641

 

Depreciation and amortization

 

3,962

 

 

292

 

 

-

 

 

4,254

 

 

 

1,959

 

 

317

 

 

-

 

 

2,276

 

Total costs and expenses

 

70,224

 

 

24,631

 

 

-

 

 

94,855

 

 

 

56,723

 

 

24,876

 

 

-

 

 

81,599

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

$

15,831

 

$

5,838

 

$

-

 

$

21,669

 

 

$

21,822

 

$

8,033

 

$

-

 

$

29,855

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Expenditures

$

10,170

 

$

173

 

$

-

 

$

10,343

 

 

$

34,411

 

$

255

 

$

-

 

$

34,666

 

 

The following tables summarize our revenue by segment and business line (in thousands) for the quarter ended September 30:

 

 

Three Months

 

 

Three Months

 

 

Ended September 30, 2017

 

 

Ended September 30, 2016

 

 

 

 

 

 

 

 

Inter-

 

Hub

 

 

 

 

 

 

 

 

Inter-

 

Hub

 

 

 

 

 

 

 

 

Segment

 

Group

 

 

 

 

 

 

 

 

Segment

 

Group

 

 

Hub

 

Mode

 

Elims

 

Total

 

 

Hub

 

Mode

 

Elims

 

Total

 

Intermodal

$

473,998

 

$

123,194

 

$

(13,665

)

$

583,527

 

 

$

466,283

 

$

126,052

 

$

(21,857

)

$

570,478

 

Truck brokerage

 

113,179

 

 

87,242

 

 

(634

)

 

199,787

 

 

 

96,906

 

 

79,627

 

 

(174

)

 

176,359

 

Logistics

 

175,679

 

 

48,260

 

 

(10,794

)

 

213,145

 

 

 

153,510

 

 

45,932

 

 

(13,465

)

 

185,977

 

Dedicated

 

57,946

 

 

-

 

 

(45

)

 

57,901

 

 

 

-

 

 

-

 

 

-

 

 

-

 

Total revenue

$

820,802

 

$

258,696

 

$

(25,138

)

$

1,054,360

 

 

$

716,699

 

$

251,611

 

$

(35,496

)

$

932,814

 

 

The following is a summary of operating results and certain other financial data for our business segments (in thousands):

 

 

Nine Months

 

 

Nine Months

 

 

Ended September 30, 2017

 

 

Ended September 30, 2016

 

 

 

 

 

 

 

 

Inter-

 

Hub

 

 

 

 

 

 

 

 

Inter-

 

Hub

 

 

 

 

 

 

 

 

Segment

 

Group

 

 

 

 

 

 

 

 

Segment

 

Group

 

 

Hub

 

Mode

 

Elims

 

Total

 

 

Hub

 

Mode

 

Elims

 

Total

 

Revenue

$

2,203,142

 

$

743,621

 

$

(74,442

)

$

2,872,321

 

 

$

1,980,450

 

$

692,366

 

$

(78,586

)

$

2,594,230

 

Transportation costs

 

1,972,725

 

 

654,612

 

 

(74,442

)

 

2,552,895

 

 

 

1,739,676

 

 

598,809

 

 

(78,586

)

 

2,259,899

 

Gross margin

 

230,417

 

 

89,009

 

 

-

 

 

319,426

 

 

 

240,774

 

 

93,557

 

 

-

 

 

334,331

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries and benefits

 

126,891

 

 

10,452

 

 

-

 

 

137,343

 

 

 

118,658

 

 

11,417

 

 

-

 

 

130,075

 

Agent fees and commissions

 

46

 

 

54,057

 

 

-

 

 

54,103

 

 

 

47

 

 

54,287

 

 

-

 

 

54,334

 

General and administrative

 

57,330

 

 

6,011

 

 

-

 

 

63,341

 

 

 

44,917

 

 

5,451

 

 

-

 

 

50,368

 

Depreciation and amortization

 

8,319

 

 

896