Hub Group, Inc. Reports Record First Quarter 2007 Revenue and Earnings
Hub Group's revenue increased 10.2% to $393.3 million compared to $356.8 million in the first quarter of 2006. First quarter intermodal revenue increased 10.4% to $287.8 million, which includes two months of additional revenue for Comtrak. Truck brokerage revenue increased 7.3% to $74.6 million this quarter. First quarter logistics revenue increased 16.4% to $30.9 million. Gross margin from continuing operations increased 19.6% to $56.7 million compared to the first quarter of 2006.
FULL YEAR 2007
Given the current operating environment, we are comfortable that the earnings for 2007 will be within the current analysts' range of $1.31 to $1.40 per diluted share.
CONFERENCE CALL
Hub will hold a conference call at 5:00 p.m. Eastern Time (4:00 p.m. Central Time) on Thursday, April 19, 2007 to discuss its first quarter results.
Hosting the conference call will be David P. Yeager, Vice-Chairman and Chief Executive Officer and Terri A. Pizzuto, Executive Vice-President, Chief Financial Officer and Treasurer.
This call is being webcast by Thomson/CCBN and can be accessed through the Investors link at Hub Group's Web site at http://www.hubgroup.com or individual investors can access the audio webcast at http://www.earnings.com and institutional investors can access the webcast at http://www.streetevents.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) 396-2386. The conference call participant code is 75476610. 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 http://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, truckload brokerage and logistics services. The Company operates through a network of over 30 offices 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, 2006. Hub Group assumes no liability to update any such forward-looking statements.
HUB GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
Three Months
Ended March 31,
2007 2006
Revenue $393,297 $356,764
Transportation costs 336,636 309,391
Gross margin 56,661 47,373
Costs and expenses:
Salaries and benefits 25,610 22,881
General and administrative 11,601 8,969
Depreciation and amortization 1,172 1,859
Total costs and expenses 38,383 33,709
Operating income 18,278 13,664
Other income (expense):
Interest expense (21) (18)
Interest income 645 446
Other, net 3 30
Total other income 627 458
Income from continuing operations before
provision for income taxes 18,905 14,122
Provision for income taxes 7,486 5,649
Income from continuing operations 11,419 8,473
Discontinued operations:
Income from discontinued operations of HGDS - 1,094
Provision for income taxes - 437
Income from discontinued operations - 657
Net income $11,419 $9,130
Basic earnings per common share
Income from continuing operations $0.29 $0.21
Income from discontinued operations - 0.02
Net income $0.29 $0.23
Diluted earnings per common share
Income from continuing operations $0.29 $0.21
Income from discontinued operations - 0.01
Net income $0.29 $0.22
Basic weighted average number of shares
outstanding 39,257 40,196
Diluted weighted average number of
shares outstanding 39,766 41,302
HUB GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
March 31, December 31,
2007 2006
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $34,730 $43,491
Accounts receivable
Trade, net 150,772 158,284
Other 8,078 8,369
Prepaid taxes 1,098 3,202
Deferred taxes 3,424 3,433
Prepaid expenses and other current
assets 6,794 4,450
TOTAL CURRENT ASSETS 204,896 221,229
Restricted investments 4,278 3,017
Property and equipment, net 27,342 26,974
Other intangibles, net 7,391 7,502
Goodwill, net 225,448 225,448
Other assets 419 378
TOTAL ASSETS $469,774 $484,548
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable
Trade $110,441 $117,676
Other 6,826 6,839
Accrued expenses
Payroll 8,545 18,294
Other 31,567 26,617
Related party payable - 5,000
TOTAL CURRENT LIABILITIES 157,379 174,426
Non-current liabilities 10,989 7,691
Deferred taxes 41,295 43,587
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value;
2,000,000 shares authorized; no shares
issued or outstanding in 2007 and 2006 - -
Common stock
Class A: $.01 par value; 47,337,700
shares authorized; 41,224,792 shares
issued and 38,789,847 outstanding in
2007; 41,224,792 shares issued and
38,943,122 outstanding in 2006 412 412
Class B: $.01 par value; 662,300 shares
authorized; 662,296 shares issued and
outstanding in 2007 and 2006 7 7
Additional paid-in capital 175,779 179,203
Purchase price in excess of predecessor
basis, net of tax benefit of $10,306 (15,458) (15,458)
Retained earnings 157,662 146,243
Treasury stock; at cost, 2,434,945
shares in 2007 and 2,281,670 shares
in 2006 (58,291) (51,563)
TOTAL STOCKHOLDERS' EQUITY 260,111 258,844
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $469,774 $484,548
HUB GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended
March 31,
2007 2006
Cash flows from operating activities:
Income from continuing operations $11,419 $8,473
Adjustments to reconcile income from
continuing operations to net cash provided
by operating activities:
Depreciation and amortization 1,804 2,176
Deferred taxes 1,652 917
Compensation expense related to share-
based compensation plans 960 771
Loss on sale of assets 2 26
Changes in operating assets and liabilities
excluding effects of purchase transaction:
Restricted investments (1,261) (586)
Accounts receivable, net 7,803 18,172
Prepaid taxes 2,104 (125)
Prepaid expenses and other current assets (2,344) (1,628)
Other assets (41) 299
Accounts payable (7,248) (5,090)
Accrued expenses (4,799) (8,292)
Non-current liabilities (637) (80)
Net cash provided by operating activities 9,414 15,033
Cash flows from investing activities:
Proceeds from sale of equipment 15 26
Purchases of property and equipment (2,078) (1,047)
Cash used in acquisition of Comtrak, Inc. (5,000) (40,491)
Net cash used in investing activities (7,063) (41,512)
Cash flows from financing activities:
Proceeds from stock options exercised 248 1,141
Purchase of treasury stock (12,740) (38)
Excess tax benefits from share-based
compensation 1,380 4,767
Net cash (used in) provided by financing
activities (11,112) 5,870
Cash flows from operating activities of
discontinued operations - 1,822
Cash flows used in investing activities of
discontinued operations - (32)
Net cash provided by discontinued
operations - 1,790
Net decrease in cash and cash equivalents (8,761) (18,819)
Cash and cash equivalents beginning of period 43,491 36,133
Cash and cash equivalents end of period $34,730 $17,314
SOURCE Hub Group, Inc.
Amy Lisek of Hub Group, Inc., +1-630-795-2214
http://www.hubgroup.com