ArcBest Corporation Announces Third Quarter 2014 Results
- Third quarter 2014 net income increased 40 percent from the previous year to $19.6 million and $0.72 per share or $20.1 million and $0.74 per share, excluding pension settlement charges.
- Increased business levels at ABF Freight(SM) contributed to higher revenues and improved profitability
- ArcBest's emerging businesses increased third quarter revenue 23 percent
- Panther continued to capitalize on a strong market demand for its services as EBITDA increased 22 percent
FORT SMITH, Ark., Nov. 3, 2014 /PRNewswire/ -- ArcBest Corporation (Nasdaq: ARCB), today reported improved third quarter 2014 results reflecting business growth at ABF Freight and all of its emerging companies, including an ongoing strong performance at Panther Premium Logistics.
ArcBest's third quarter 2014 revenue was $711.3 million compared to revenue of $623.4 million in the third quarter of 2013, an increase of 14 percent. Third quarter net income was $19.6 million and $0.72 per share, or $20.1 million and $0.74 per share excluding pension settlement charges, compared to third quarter 2013 net income of $14.0 million, and $0.52 per share, or $14.3 million and $0.53 per share excluding pension settlement charges and tax items.
At ABF Freight, third quarter revenue was $523.4 million, an 11 percent increase over $471.0 million in the same period last year. Operating income increased to $24.7 million from $17.2 million in third quarter 2013. ABF Freight's operating ratio was 95.3 percent versus 96.3 percent in the year-ago period.
On a combined basis, revenue for ArcBest's emerging, non-asset-based businesses increased by 23 percent. During the quarter, these businesses represented 28 percent of ArcBest's total consolidated revenue, an increase compared to the first half of this year and a higher percentage than in all of 2013. Third quarter 2014 earnings before interest, taxes, depreciation and amortization ("EBITDA") at the non-asset-based businesses was $13.0 million, an increase of 35 percent compared to EBITDA of $9.7 million in the third quarter of 2013.
"We continued to see strong demand for services from the ArcBest companies in the third quarter and are pleased that our commitment to provide customers easier access to our supply chain solutions is being well received," said Judy R. McReynolds, ArcBest President and Chief Executive Officer. "Panther, in particular, reported one of its strongest quarters ever, contributing over $4 million of operating income and $7 million of EBITDA. Year-to-date through September, Panther's EBITDA was more than $20 million."
McReynolds noted that ABF Logisticssm and ABF Movingsm also experienced strong gains in operating profit for the quarter and that ABF Freight continues to focus on improving the services offered to its customers, implementing important operational initiatives, and working toward increased success in the future.
ABF Freight
During the quarter, ABF Freight benefited from an LTL freight environment that was positively impacted by improving economic trends, tighter industry capacity amid driver shortages, and additional LTL shipments associated with service and demand constraints in other transportation modes. Though new customers were added, the significant growth ABF Freight experienced during the quarter was strongly impacted by additional shipments from existing customers. Because more freight was moving through the system, costs were incurred to maintain customer service. These higher business levels, while beneficial for long-term growth, require additional resources in the short term.
As experienced throughout the first half of the year, the pricing environment was positive, and ABF Freight was able to obtain price increases needed to improve operating margins. Third quarter total revenue per hundredweight increased by 3.0 percent over last year and improved 2.1 percent versus this year's second quarter. During the quarter, increases in the amount of ABF Freight's LTL shipments combined with fewer truckload-rated shipments affected the total price increases ABF secured. As previously announced, ABF Freight implemented a 5.4 percent increase in general rates and charges effective today. This increase, the second GRI implemented during the year, impacts approximately 35 percent of ABF Freight's business.
Though showing some improvement relative to the second quarter, the productivity of inexperienced dock employees hired as a result of historically high business growth and the associated increase of labor hours continued to impact ABF Freight's operational results during the third quarter. Actions are actively being taken to drive productivity improvements and to reduce total labor hours to match available freight levels. In order to reduce costs and improve the transportation services offered to our customers, returning productivity to historical levels is an important priority for ABF Freight's management team.
ABF Freight President Retires
In mid-October, ABF Freight president and CEO Roy Slagle retired after 37 years with the company. "During his long career with ABF Freight, Roy Slagle provided dedicated service and expertise in most every area of the company," said McReynolds. "Roy was a key contributor to ABF Freight's success and positive reputation in the transportation industry. I wish Roy well in his retirement and continued success in the future."
ABF Freight's new president is Tim Thorne, a 24-year veteran of the company. "Tim has a strong background in operations and field management at ABF Freight. With his approach to leadership and pursuit of excellence in the customer experience, ABF Freight is well positioned to succeed going forward," McReynolds added.
Emerging, Non-Asset-Based Businesses
During the third quarter, ArcBest's emerging businesses all generated revenue growth compared to the same period last year, highlighted by solid revenue and margin increases at Panther Premium Logistics, ABF Logistics and ABF Moving.
The improving economy and significant growth at key customer accounts contributed to Panther's third quarter revenue increase of 26 percent and an operating income increase of 33 percent over the same period last year. Panther continues to experience strong demand for its services across all of the industry markets it serves. Increased business from several new customer accounts added during the year is also contributing to the growth in revenue and profit.
Third quarter revenues at FleetNet America® increased by 8 percent over the previous year while operating profit was moderately lower. FleetNet's revenue growth benefited from business with several new fleet maintenance customers and improved pricing yield on existing accounts despite the effect of mild summer weather on the typical seasonal demand for emergency roadside services. The operating profit comparison to the prior year was influenced by investments to support future business growth.
Consistent with the first half of the year, ABF Logistics increased third quarter revenue by 42 percent compared to the same period of 2013, primarily due to shipment growth and higher revenue per load in its truckload brokerage division. Operating profit in the third quarter was the strongest of this year, with growth of 96 percent over the same period in 2013.
ABF Moving experienced a 16 percent revenue increase during the quarter and improved its third quarter operating profit by 80 percent. ABF Moving's increased ability to service seasonal summer demand for household goods moving services combined with improved cost management were positive factors in the quarter.
Capital Structure and Financial Resources
ArcBest's financial strength has provided stability through previously challenging economic periods while offering options in the ongoing pursuit of available growth opportunities. As recently announced, ArcBest's board of directors approved an increase in the quarterly cash dividend to $0.06 per share from the previous amount of $0.03 per share. "We are pleased to make this positive change for shareholders. In order to achieve our goals for the future, we continue to be well positioned to take advantage of acquisition and organic investment opportunities as they arise while, at the same time, improving shareholder returns," said McReynolds.
Conference Call
ArcBest Corporation will host a conference call with company executives to discuss the 2014 third quarter results. The call will be today, Monday, November 3, at 9:30 a.m. ET (8:30 a.m. CT). Interested parties are invited to listen by calling (800) 896-0105. Following the call, a recorded playback will be available through the end of the day on December 4, 2014. To listen to the playback, dial (800) 633-8284 or (402) 977-9140 (for international callers). The conference call ID for the playback is 21735598. The conference call and playback can also be accessed, through December 4, 2014, on ArcBest's website at arcb.com.
About ArcBest
ArcBest Corporationsm (Nasdaq: ARCB) solves complex logistics and transportation challenges. Our companies and brands – ABF Freightsm, ABF Logisticssm, Panther Premium Logisticssm, FleetNet America®, U-Pack® and ArcBest Technologies – apply the skill and the will with every shipment and supply chain solution, household move or vehicle repair. ArcBest finds a way.
For more information, visit arcb.com, abf.com, pantherpremium.com, fleetnetamerica.com and upack.com. ArcBest Corporationsm. The Skill & The Willsm.
Forward-Looking Statements
Certain statements and information in this press release concerning results for the three and nine months ended September 30, 2014 may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Terms such as "anticipate," "believe," "could," "estimate," "expect," "forecast," "foresee," "intend," "may," "plan," "predict," "project," "scheduled," "should," "would" and similar expressions and the negatives of such terms are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on management's current expectations and beliefs concerning future developments and their potential effect on us. Although management believes that these forward-looking statements are reasonable, as and when made, there can be no assurance that future developments affecting us will be those that we anticipate. Our forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and management's present expectations or projections. Important factors that could cause our actual results to differ materially from those in the forward-looking statements include, but are not limited to: general economic conditions and related shifts in market demand that impact the performance and needs of industries served by ArcBest Corporation's subsidiaries and/or limit our customers' access to adequate financial resources; unfavorable terms of, or the inability to reach agreement on, future collective bargaining agreements or a workforce stoppage by our employees covered under ABF Freight's collective bargaining agreement; relationships with employees, including unions; union and nonunion employee wages and benefits, including changes in required contributions to multiemployer pension plans; competitive initiatives, pricing pressures, the effect of volatility in fuel prices and the associated changes in fuel surcharges on securing increases in base freight rates and the inability to collect fuel surcharges; availability of fuel; default on covenants of financing arrangements and the availability and terms of future financing arrangements; availability and cost of reliable third-party services; disruptions or failures of services essential to the operation of our business or the use of information technology platforms in our business; timing and amount of capital expenditures, increased prices for and decreased availability of new revenue equipment and decreases in value of used revenue equipment; future costs of operating expenses such as maintenance and fuel and related taxes; self-insurance claims and insurance premium costs; governmental regulations and policies, including environmental laws and regulations; potential impairment of goodwill and intangible assets; the impact of our brands and corporate reputation; the cost, timing and performance of growth initiatives; the cost, integration and performance of any future acquisitions; the costs of continuing investments in technology, a failure of our information systems and the impact of cyber incidents; weather conditions; and other financial, operational and legal risks and uncertainties detailed from time to time in ArcBest Corporation's Securities and Exchange Commission public filings.
For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise.
Financial Data and Operating Statistics
The following tables show financial data and operating statistics on ArcBest Corporationsm and its subsidiary companies.
| Investor Relations Contact: David Humphrey |
Media Contact: Kathy Fieweger |
| Title: Vice President – Investor Relations |
Title: Chief Marketing Officer |
| Phone: 479-785-6200 |
Phone: 479-719-4358 |
| Email: [email protected] |
Email: [email protected] |
| ARCBEST CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30 |
Nine Months Ended September 30 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2014 |
2013 |
2014 |
2013 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ($ thousands, except share and per share data) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| REVENUES |
$ |
711,295 |
$ |
623,414 |
$ |
1,947,845 |
$ |
1,720,999 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| OPERATING EXPENSES |
678,354 |
602,912 |
1,896,655 |
1,715,431 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| OPERATING INCOME |
32,941 |
20,502 |
51,190 |
5,568 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| OTHER INCOME (COSTS) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest and dividend income |
215 |
167 |
600 |
499 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest and other related financing costs |
(834) |
(993) |
(2,367) |
(3,279) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other, net |
234 |
1,328 |
1,549 |
2,778 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| (385) |
502 |
(218) |
(2) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INCOME BEFORE INCOME TAXES |
32,556 |
21,004 |
50,972 |
5,566 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| INCOME TAX PROVISION |
12,938 |
7,022 |
19,339 |
101 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| NET INCOME |
$ |
19,618 |
$ |
13,982 |
$ |
31,633 |
$ |
5,465 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| EARNINGS PER COMMON SHARE(1) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Basic |
$ |
0.72 |
$ |
0.52 |
$ |
1.16 |
$ |
0.20 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Diluted |
$ |
0.72 |
$ |
0.52 |
$ |
1.16 |
$ |
0.20 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| AVERAGE COMMON SHARES OUTSTANDING |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Basic |
26,054,678 |
25,736,810 |
25,979,555 |
25,690,184 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Diluted |
26,054,678 |
25,736,810 |
25,980,008 |
25,690,184 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| CASH DIVIDENDS DECLARED |
$ |
0.03 |
$ |
0.03 |
$ |
0.09 |
$ |
0.09 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| (1) |
ArcBest uses the two-class method for calculating earnings per share. This method, as calculated below, requires an allocation of dividends paid and a portion of undistributed net income to unvested restricted stock for calculating per share amounts. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| NET INCOME |
$ |
19,618 |
$ |
13,982 |
$ |
31,633 |
$ |
5,465 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| EFFECT OF UNVESTED RESTRICTED |
(981) |
(585) |
(1,591) |
(243) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| ADJUSTED NET INCOME FOR CALCULATING EARNINGS PER COMMON SHARE |
$ |
18,637 |
$ |
13,397 |
$ |
30,042 |
$ |
5,222 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| ARCBEST CORPORATION CONSOLIDATED BALANCE SHEETS |
|||||||||||||||||||||||||
| September 30 2014 |
December 31 2013 |
||||||||||||||||||||||||
| (Unaudited) |
Note |
||||||||||||||||||||||||
| ($ thousands, except share data) |
|||||||||||||||||||||||||
| ASSETS |
|||||||||||||||||||||||||
| CURRENT ASSETS |
|||||||||||||||||||||||||
| Cash and cash equivalents |
$ |
159,382 |
$ |
105,354 |
|||||||||||||||||||||
| Short-term investments |
43,858 |
35,906 |
|||||||||||||||||||||||
| Restricted cash, cash equivalents, and short-term investments |
1,385 |
1,902 |
|||||||||||||||||||||||
| Accounts receivable, less allowances (2014 – $5,613; 2013 – $4,533) |
243,099 |
202,540 |
|||||||||||||||||||||||
| Other accounts receivable, less allowances (2014 – $1,676; 2013 – $1,422) |
6,144 |
7,272 |
|||||||||||||||||||||||
| Prepaid expenses |
17,542 |
19,016 |
|||||||||||||||||||||||
| Deferred income taxes |
43,352 |
37,482 |
|||||||||||||||||||||||
| Prepaid and refundable income taxes |
2,262 |
2,061 |
|||||||||||||||||||||||
| Other |
7,489 |
6,952 |
|||||||||||||||||||||||
| TOTAL CURRENT ASSETS |
524,513 |
418,485 |
|||||||||||||||||||||||
| PROPERTY, PLANT AND EQUIPMENT |
|||||||||||||||||||||||||
| Land and structures |
250,816 |
245,805 |
|||||||||||||||||||||||
| Revenue equipment |
629,791 |
589,902 |
|||||||||||||||||||||||
| Service, office, and other equipment |
128,645 |
124,303 |
|||||||||||||||||||||||
| Software |
113,770 |
110,998 |
|||||||||||||||||||||||
| Leasehold improvements |
23,941 |
23,582 |
|||||||||||||||||||||||
| 1,146,963 |
1,094,590 |
||||||||||||||||||||||||
| Less allowances for depreciation and amortization |
735,090 |
700,193 |
|||||||||||||||||||||||
| 411,873 |
394,397 |
||||||||||||||||||||||||
| GOODWILL |
77,078 |
76,448 |
|||||||||||||||||||||||
| INTANGIBLE ASSETS, net |
73,919 |
75,387 |
|||||||||||||||||||||||
| OTHER ASSETS |
53,184 |
52,609 |
|||||||||||||||||||||||
| $ |
1,140,567 |
$ |
1,017,326 |
||||||||||||||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||||||||||||||||||||
| CURRENT LIABILITIES |
|||||||||||||||||||||||||
| Bank overdraft and drafts payable |
$ |
15,914 |
$ |
13,609 |
|||||||||||||||||||||
| Accounts payable |
135,022 |
89,091 |
|||||||||||||||||||||||
| Income taxes payable |
16,809 |
1,782 |
|||||||||||||||||||||||
| Accrued expenses |
187,682 |
173,622 |
|||||||||||||||||||||||
| Current portion of long-term debt |
40,088 |
31,513 |
|||||||||||||||||||||||
| TOTAL CURRENT LIABILITIES |
395,515 |
309,617 |
|||||||||||||||||||||||
| LONG-TERM DEBT, less current portion |
85,735 |
81,332 |
|||||||||||||||||||||||
| PENSION AND POSTRETIREMENT LIABILITIES |
37,272 |
26,847 |
|||||||||||||||||||||||
| OTHER LIABILITIES |
14,482 |
15,041 |
|||||||||||||||||||||||
| DEFERRED INCOME TAXES |
56,481 |
64,028 |
|||||||||||||||||||||||
| STOCKHOLDERS' EQUITY |
|||||||||||||||||||||||||
| Common stock, $0.01 par value, authorized 70,000,000 shares; issued 2014: 27,697,264 shares; 2013: 27,507,241 shares |
277 |
275 |
|||||||||||||||||||||||
| Additional paid-in capital |
301,365 |
296,133 |
|||||||||||||||||||||||
| Retained earnings |
325,910 |
296,735 |
|||||||||||||||||||||||
| Treasury stock, at cost, 1,677,932 shares |
(57,770) |
(57,770) |
|||||||||||||||||||||||
| Accumulated other comprehensive loss |
(18,700) |
(14,912) |
|||||||||||||||||||||||
| TOTAL STOCKHOLDERS' EQUITY |
551,082 |
520,461 |
|||||||||||||||||||||||
| $ |
1,140,567 |
$ |
1,017,326 |
||||||||||||||||||||||
| Note: The balance sheet at December 31, 2013 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. |
| ARCBEST CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2014 |
2013 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ($ thousands) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| OPERATING ACTIVITIES |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income |
$ |
31,633 |
$ |
5,465 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Adjustments to reconcile net income to net cash |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization |
60,613 |
64,439 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of intangibles |
3,242 |
3,130 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Pension settlement expense |
5,405 |
1,834 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense |
5,362 |
3,579 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Provision for losses on accounts receivable |
1,647 |
1,658 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Deferred income tax benefit |
(7,409) |
(5,770) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gain on sale of property and equipment |
(597) |
(486) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Changes in operating assets and liabilities: |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Receivables |
(41,180) |
(36,513) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Prepaid expenses |
1,477 |
1,768 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other assets |
(1,081) |
(1,557) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income taxes |
9,981 |
6,868 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accounts payable, accrued expenses, and other liabilities(1) |
49,108 |
21,836 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| NET CASH PROVIDED BY OPERATING ACTIVITIES |
118,201 |
66,251 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| INVESTING ACTIVITIES |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Purchases of property, plant and equipment, net of financings |
(23,756) |
(13,078) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Proceeds from sale of property and equipment |
2,701 |
1,857 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Purchases of short-term investments |
(25,347) |
(21,230) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Proceeds from sale of short-term investments |
17,478 |
21,713 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Business acquisition, net of cash acquired |
(2,647) |
(4,146) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Capitalization of internally developed software |
(6,016) |
(5,959) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| NET CASH USED IN INVESTING ACTIVITIES |
(37,587) |
(20,843) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| FINANCING ACTIVITIES |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payments on long-term debt |
(28,024) |
(31,775) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net change in bank overdraft and other |
2,304 |
(2,002) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net change in restricted cash, cash equivalents, and short-term investments |
517 |
7,757 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Deferred financing costs |
(61) |
(61) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payment of common stock dividends |
(2,458) |
(2,418) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Proceeds from the exercise of stock options |
1,136 |
– |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| NET CASH USED IN FINANCING ACTIVITIES |
(26,586) |
(28,499) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS |
54,028 |
16,909 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cash and cash equivalents at beginning of period |
105,354 |
90,702 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD |
$ |
159,382 |
$ |
107,611 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| NONCASH INVESTING ACTIVITIES |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accruals for equipment received |
$ |
9,632 |
$ |
264 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equipment financed |
$ |
41,002 |
$ |
36 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| (1) 2013 includes $17.8 million of cash contributions to the Company's nonunion defined benefit pension plan. |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ARCBEST CORPORATION RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended September 30 |
Nine Months Ended September 30 |
||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2014 |
2013 |
2014 |
2013 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| ($ thousands, except per share data) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| ARCBEST CORPORATION – CONSOLIDATED |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Income |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amounts on a GAAP basis |
$ |
19,618 |
$ |
13,982 |
$ |
31,633 |
$ |
5,465 |
|||||||||||||||||||||||||||||||||||||||||||||
| Tax benefits and credits(1) |
– |
(838) |
(701) |
(2,474) |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Pension settlement expense, after-tax(2) |
492 |
1,121 |
3,303 |
1,121 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP amounts |
$ |
20,110 |
$ |
14,265 |
$ |
34,235 |
$ |
4,112 |
|||||||||||||||||||||||||||||||||||||||||||||
| Diluted Earnings Per Share |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Amounts on a GAAP basis |
$ |
0.72 |
$ |
0.52 |
$ |
1.16 |
$ |
0.20 |
|||||||||||||||||||||||||||||||||||||||||||||
| Tax benefits and credits(1) |
– |
(0.03) |
(0.03) |
(0.09) |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Pension settlement expense, after-tax(2) |
0.02 |
0.04 |
0.13 |
0.04 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP amounts |
$ |
0.74 |
$ |
0.53 |
$ |
1.26 |
$ |
0.15 |
|||||||||||||||||||||||||||||||||||||||||||||
| ARCBEST CORPORATION – CONSOLIDATED |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Earnings Before Interest, Taxes, Depreciation |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income |
$ |
19,618 |
$ |
13,982 |
$ |
31,633 |
$ |
5,465 |
|||||||||||||||||||||||||||||||||||||||||||||
| Interest and other related financing costs |
834 |
993 |
2,367 |
3,279 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Income tax provision |
12,938 |
7,022 |
19,339 |
101 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization |
22,177 |
21,569 |
63,855 |
67,569 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of share-based compensation |
1,694 |
1,095 |
5,362 |
3,579 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Amortization of actuarial losses of benefit plans and pension settlement expense(2) |
1,480 |
2,994 |
7,373 |
8,818 |
|||||||||||||||||||||||||||||||||||||||||||||||||
| $ |
58,741 |
$ |
47,655 |
$ |
129,929 |
$ |
88,811 |
||||||||||||||||||||||||||||||||||||||||||||||
| (1) |
Tax adjustments are related to decreases in the deferred tax asset valuation allowances and, for the 2013 periods, alternative fuel tax credits. |
| (2) |
The three and nine months ended September 30, 2014 includes pension settlement expense of $0.8 million (pre-tax) and $5.4 million (pre-tax), respectively. The three and nine months ended September 30, 2013 include pension settlement expense of $1.8 million (pre-tax). |
|
Non-GAAP Financial Measures. ArcBest reports its financial results in accordance with generally accepted accounting principles ("GAAP"). However, management believes that certain non-GAAP performance measures and ratios utilized for internal analysis provide financial statement users meaningful comparisons between current and prior period results, as well as important information regarding performance trends. Certain information discussed in the scheduled conference call could be considered non-GAAP measures. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, ArcBest's reported results. Management believes EBITDA to be relevant and useful information as EBITDA is a standard measure commonly reported and widely used by analysts, investors and others to measure financial performance and ability to service debt obligations. However, these financial measures should not be construed as better measurements than operating income, operating cash flow, net income or earnings per share, as defined by GAAP. Other companies may calculate EBITDA differently and, therefore, ArcBest's EBITDA may not be comparable to similarly titled measures of other companies. |
|
| ARCBEST CORPORATION |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30 2014 |
Three Months Ended September 30 2013 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ($ thousands) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Operating Income |
Depreciation and Amortization |
EBITDA |
Operating Income |
Depreciation and Amortization |
EBITDA |
|||||||||||||||||||||||||||||||||||||||||||||||||
| Premium Logistics (Panther)(1) |
$ |
4,119 |
$ |
2,891 |
$ |
7,010 |
$ |
3,102 |
$ |
2,665 |
$ |
5,767 |
||||||||||||||||||||||||||||||||||||||||||
| Emergency & Preventative Maintenance (FleetNet) |
739 |
266 |
1,005 |
845 |
138 |
983 |
||||||||||||||||||||||||||||||||||||||||||||||||
| Transportation Management (ABF Logistics) |
1,060 |
256 |
1,316 |
541 |
171 |
712 |
||||||||||||||||||||||||||||||||||||||||||||||||
| Household Goods Moving Services (ABF Moving) |
3,309 |
349 |
3,658 |
1,835 |
354 |
2,189 |
||||||||||||||||||||||||||||||||||||||||||||||||
| Total non-asset-based segments |
$ |
9,227 |
$ |
3,762 |
$ |
12,989 |
$ |
6,323 |
$ |
3,328 |
$ |
9,651 |
||||||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30 2014 |
Nine Months Ended September 30 2013 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ($ thousands) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Operating Income |
Depreciation and Amortization |
EBITDA |
Operating Income |
Depreciation and Amortization |
EBITDA |
||||||||||||||||||||||||||||||||||||||||||||||||||||
| Premium Logistics (Panther)(1) |
$ |
11,841 |
$ |
8,465 |
$ |
20,306 |
$ |
3,745 |
$ |
7,809 |
$ |
11,554 |
|||||||||||||||||||||||||||||||||||||||||||||
| Emergency & Preventative Maintenance (FleetNet) |
2,840 |
677 |
3,517 |
2,367 |
400 |
2,767 |
|||||||||||||||||||||||||||||||||||||||||||||||||||
| Transportation Management (ABF Logistics) |
2,449 |
725 |
3,174 |
1,564 |
449 |
2,013 |
|||||||||||||||||||||||||||||||||||||||||||||||||||
| Household Goods Moving Services (ABF Moving) |
3,091 |
1,043 |
4,134 |
2,552 |
880 |
3,432 |
|||||||||||||||||||||||||||||||||||||||||||||||||||
| Total non-asset-based segments |
$ |
20,221 |
$ |
10,910 |
$ |
31,131 |
$ |
10,228 |
$ |
9,538 |
$ |
19,766 |
|||||||||||||||||||||||||||||||||||||||||||||
| (1) |
Depreciation and amortization consists primarily of amortization of intangibles, including customer relationships and software associated with the June 15, 2012 acquisition of Panther. |
| ARCBEST CORPORATION FINANCIAL STATEMENT OPERATING SEGMENT DATA AND OPERATING RATIOS |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30 |
Nine Months Ended September 30 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2014 |
2013 |
2014 |
2013 |
|||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) ($ thousands, except percentages) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| REVENUES |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Freight Transportation (ABF Freight) |
$ |
523,351 |
$ |
471,031 |
$ |
1,445,079 |
$ |
1,325,062 |
||||||||||||||||||||||||||||||||||||||||||||||
| Premium Logistics (Panther) |
82,784 |
65,851 |
236,435 |
179,533 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Emergency & Preventative Maintenance (FleetNet) |
40,117 |
37,047 |
120,123 |
102,504 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Transportation Management (ABF Logistics) |
40,672 |
28,669 |
105,882 |
74,554 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Household Goods Moving Services (ABF Moving) |
35,338 |
30,530 |
72,943 |
65,358 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Total non-asset-based segments |
198,911 |
162,097 |
535,383 |
421,949 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Other and eliminations |
(10,967) |
(9,714) |
(32,617) |
(26,012) |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Total consolidated revenues |
$ |
711,295 |
$ |
623,414 |
$ |
1,947,845 |
$ |
1,720,999 |
||||||||||||||||||||||||||||||||||||||||||||||
| OPERATING EXPENSES |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Freight Transportation (ABF Freight) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Salaries, wages, and benefits |
$ |
294,826 |
56.3% |
$ |
276,683 |
58.7% |
$ |
835,354 |
57.8% |
$ |
816,502 |
61.6% |
||||||||||||||||||||||||||||||||||||||||||
| Fuel, supplies, and expenses |
91,406 |
17.5 |
84,714 |
18.0 |
275,473 |
19.1 |
250,486 |
18.9 |
||||||||||||||||||||||||||||||||||||||||||||||
| Operating taxes and licenses |
11,262 |
2.2 |
10,864 |
2.3 |
34,525 |
2.4 |
32,793 |
2.5 |
||||||||||||||||||||||||||||||||||||||||||||||
| Insurance |
6,498 |
1.2 |
6,858 |
1.5 |
17,859 |
1.2 |
17,410 |
1.3 |
||||||||||||||||||||||||||||||||||||||||||||||
| Communications and utilities |
3,768 |
0.7 |
3,724 |
0.8 |
11,741 |
0.8 |
11,535 |
0.9 |
||||||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization |
17,746 |
3.4 |
17,621 |
3.7 |
50,925 |
3.5 |
56,162 |
4.2 |
||||||||||||||||||||||||||||||||||||||||||||||
| Rents and purchased transportation |
69,985 |
13.4 |
50,507 |
10.7 |
172,954 |
12.0 |
133,236 |
10.1 |
||||||||||||||||||||||||||||||||||||||||||||||
| Gain on sale of property and equipment |
(333) |
(0.1) |
(93) |
– |
(576) |
– |
(487) |
– |
||||||||||||||||||||||||||||||||||||||||||||||
| Pension settlement expense(1) |
627 |
0.1 |
1,612 |
0.3 |
4,224 |
0.3 |
1,612 |
0.1 |
||||||||||||||||||||||||||||||||||||||||||||||
| Other |
2,829 |
0.6 |
1,325 |
0.3 |
7,211 |
0.5 |
5,649 |
0.4 |
||||||||||||||||||||||||||||||||||||||||||||||
| 498,614 |
95.3% |
453,815 |
96.3% |
1,409,690 |
97.6% |
1,324,898 |
100.00% |
|||||||||||||||||||||||||||||||||||||||||||||||
| Premium Logistics (Panther) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Purchased transportation |
$ |
61,298 |
74.0% |
$ |
50,220 |
76.3% |
$ |
176,057 |
74.5% |
$ |
137,489 |
76.6% |
||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization(2) |
2,891 |
3.5 |
2,665 |
4.0 |
8,465 |
3.6 |
7,809 |
4.3 |
||||||||||||||||||||||||||||||||||||||||||||||
| Salaries, benefits, insurance, and other |
14,476 |
17.5 |
9,864 |
15.0 |
40,072 |
16.9 |
30,490 |
17.0 |
||||||||||||||||||||||||||||||||||||||||||||||
| 78,665 |
95.0% |
62,749 |
95.3% |
224,594 |
95.0% |
175,788 |
97.9% |
|||||||||||||||||||||||||||||||||||||||||||||||
| Emergency & Preventative Maintenance (FleetNet) |
$ |
39,378 |
$ |
36,202 |
$ |
117,283 |
$ |
100,137 |
||||||||||||||||||||||||||||||||||||||||||||||
| Transportation Management (ABF Logistics) |
39,612 |
28,128 |
103,433 |
72,990 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Household Goods Moving Services (ABF Moving) |
32,029 |
28,695 |
69,852 |
62,806 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Total non-asset-based segments(1) |
189,684 |
155,774 |
515,162 |
411,721 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Other and eliminations(1) |
(9,944) |
(6,677) |
(28,197) |
(21,188) |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Total consolidated operating expenses and costs(1) |
$ |
678,354 |
$ |
602,912 |
$ |
1,896,655 |
$ |
1,715,431 |
||||||||||||||||||||||||||||||||||||||||||||||
| (1) |
Pension settlement expense totaled $0.8 million (pre-tax) and $5.4 million (pre-tax) on a consolidated basis for the three and nine months ended September 30, 2014, respectively, and $1.8 million (pre-tax) for the three and nine months ended September 30, 2013, respectively. Of the total $5.4 million (pre-tax) pension settlement expense for the nine months ended September 30, 2014, $4.2 million was reported by ABF Freight, $1.1 million was reported in Other and eliminations, and $0.1 million was reported by the non-asset-based segments. Of the total $1.8 million (pre-tax) pension settlement expense for the nine months ended September 30, 2013, $1.5 million was reported by ABF Freight and $0.3 million was reported in Other and eliminations. |
| (2) |
Depreciation and amortization consists primarily of amortization of intangibles, including customer relationships and software associated with the June 15, 2012 acquisition of Panther. |
| ARCBEST CORPORATION FINANCIAL STATEMENT OPERATING SEGMENT DATA AND OPERATING RATIOS – Continued |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30 |
Nine Months Ended September 30 |
|||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2014 |
2013 |
2014 |
2013 |
|||||||||||||||||||||||||||||||||||||||||||||||||||
| (Unaudited) ($ thousands) |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| OPERATING INCOME |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Freight Transportation (ABF Freight) |
$ |
24,737 |
$ |
17,216 |
$ |
35,389 |
$ |
164 |
||||||||||||||||||||||||||||||||||||||||||||||
| Premium Logistics (Panther) |
4,119 |
3,102 |
11,841 |
3,745 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Emergency & Preventative Maintenance (FleetNet) |
739 |
845 |
2,840 |
2,367 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Transportation Management (ABF Logistics) |
1,060 |
541 |
2,449 |
1,564 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Household Goods Moving Services (ABF Moving) |
3,309 |
1,835 |
3,091 |
2,552 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Total non-asset-based segments |
9,227 |
6,323 |
20,221 |
10,228 |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Other and eliminations(1) |
(1,023) |
(3,037) |
(4,420) |
(4,824) |
||||||||||||||||||||||||||||||||||||||||||||||||||
| Total consolidated operating income |
$ |
32,941 |
$ |
20,502 |
$ |
51,190 |
$ |
5,568 |
||||||||||||||||||||||||||||||||||||||||||||||
| (1) |
Other and eliminations for 2013 includes a $1.4 million reserve adjustment related to workers' compensation claims associated with an insolvent excess insurance carrier. |
ARCBEST CORPORATION OPERATING STATISTICS |
|||||||||||||||||
| Three Months Ended |
Nine Months Ended |
||||||||||||||||
| September 30 |
September 30 |
||||||||||||||||
| 2014 |
2013 |
% Change |
2014 |
2013 |
% Change |
||||||||||||
| (Unaudited) |
|||||||||||||||||
| Freight Transportation (ABF Freight) |
|||||||||||||||||
| Workdays |
64.0 |
63.5 |
190.5 |
190.0 |
|||||||||||||
| Billed Revenue(1) / CWT |
$ |
29.53 |
$ |
28.67 |
3.0% |
$ |
28.54 |
$ |
27.78 |
2.7% |
|||||||
| Billed Revenue(1) / Shipment |
$ |
389.70 |
$ |
390.44 |
(0.2)% |
$ |
388.46 |
$ |
381.11 |
1.9% |
|||||||
| Shipments |
1,330,091 |
1,201,981 |
10.7% |
3,725,093 |
3,488,337 |
6.8% |
|||||||||||
| Shipments / Day |
20,783 |
18,929 |
9.8% |
19,554 |
18,360 |
6.5% |
|||||||||||
| Tonnage (tons) |
877,531 |
818,471 |
7.2% |
2,535,235 |
2,393,055 |
5.9% |
|||||||||||
| Tons / Day |
13,711 |
12,889 |
6.4% |
13,308 |
12,595 |
5.7% |
|||||||||||
| (1) |
Revenue for undelivered freight is deferred for financial statement purposes in accordance with ABF Freight's revenue recognition policy. Billed revenue used for calculating revenue per hundredweight measurements has not been adjusted for the portion of revenue deferred for financial statement purposes. Billed revenue has been adjusted to exclude intercompany revenue that is not related to freight transportation services. |
SOURCE ArcBest Corporation
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