Landstar System Reports 35 Percent Increase in Fourth Quarter Earnings Per Share

JACKSONVILLE, Fla., Feb. 1, 2011 /PRNewswire/ -- Landstar System, Inc. (Nasdaq: LSTR) reported 2010 fourth quarter net income of $24.1 million, or $0.50 per diluted share, compared to net income of $18.6 million, or $0.37 per diluted share, for the 2009 fourth quarter.  Revenue for the 2010 fourth quarter was $587.5 million compared to $547.7 million in the 2009 fourth quarter.  

Truck transportation revenue hauled by independent business capacity owners ("BCOs") and truck brokerage carriers in the 2010 fourth quarter was $537.6 million, or 91 percent of revenue, compared to $498.4 million, or 91 percent of revenue, in the 2009 fourth quarter. In the 2010 and 2009 fourth quarters, the Company invoiced customers $51.1 million and $40.7 million, respectively, of fuel surcharges that were passed 100 percent to BCOs and excluded from revenue.  Revenue hauled by rail, air and ocean cargo carriers was $36.7 million, or 6 percent of revenue, in the 2010 fourth quarter compared to $35.0 million, or 6 percent of revenue, in the 2009 fourth quarter. Transportation management fee revenue generated by the supply chain solutions companies was $4.4 million, or 1 percent of revenue, in both the 2010 and 2009 fourth quarters.

Commenting on Landstar's 2010 fourth quarter, Henry Gerkens, Landstar's Chairman, President and CEO said, "I am very pleased with the way the Company finished the year. Operating income and diluted earnings per share in the 2010 fourth quarter increased 30 percent and 35 percent, respectively, over the 2009 fourth quarter. Gross profit, defined as revenue less the cost of purchased transportation and commissions to agents, in the 2010 fourth quarter increased 8 percent over the 2009 fourth quarter. As anticipated, revenue in the 2010 fourth quarter compared to revenue in the 2009 fourth quarter was negatively impacted by a significant decrease in the number of loads hauled under the Company's less-than-truckload substitute line haul service offering. Revenue under the Company's less-than-truckload substitute line haul service offering decreased to 4 percent of revenue in the 2010 fourth quarter compared to 13 percent of revenue in the 2009 fourth quarter. Excluding the impact of the revenue decline in this service offering, the total number of truck transportation loads hauled in the 2010 fourth quarter increased 8 percent over the 2009 fourth quarter and revenue per load for truck transportation for the fourth quarter of 2010 increased 12 percent over the 2009 fourth quarter. In addition, the number of loads hauled by air and ocean carriers in the 2010 fourth quarter increased 50 percent and 31 percent, respectively, over the 2009 fourth quarter."

"Landstar continues to generate outstanding returns. Return on average shareholder's equity was 32 percent and return on invested capital, net income divided by the sum of average equity plus average debt, was 22 percent. Landstar System, Inc. also announced that its Board of Directors has declared a quarterly dividend of $0.05 per share. The dividend is payable on March 11, 2011 to stockholders of record at the close of business on February 14, 2011. It is the intention of the Board of Directors to continue to pay a quarterly dividend. During the 2010 fourth quarter, Landstar purchased 1,277,000 shares of its common stock at a total cost of $48.1 million. During 2010, the Company purchased 2,653,000 shares of its common stock at a total cost of $102.7 million. Under the Company's authorized share purchase program, the Company currently has a total of 723,000 shares of its common stock available for purchase."

Gerkens continued, "As reported by FIRST CALL, the current ranges of analysts' earnings estimates for the 2011 first quarter and full year are $0.38 to $0.45 per diluted share and $1.95 to $2.29 per diluted share. Based upon current revenue trends and the anticipated continuation of those trends through the balance of the year, I am comfortable with the current range of analysts' earnings estimates for both the 2011 first quarter and full year."

Landstar will provide a live webcast of its quarterly earnings conference call this afternoon at 2:00 pm ET. To access the webcast, visit the Company's website at www.landstar.com; click on "Investor Relations" and "Webcasts," then click on "Landstar's Fourth Quarter 2010 Earnings Release Conference Call."  

The following is a "safe harbor" statement under the Private Securities Litigation Reform Act of 1995.  Statements contained in this press release that are not based on historical facts are "forward-looking statements".  This press release contains forward-looking statements, such as statements which relate to Landstar's business objectives, plans, strategies, expectations and intentions.  Terms such as "anticipates," "believes," "estimates," "intention," "plans," "predicts," "may," "should," "will," the negative thereof and similar expressions are intended to identify forward-looking statements.  Such statements are by nature subject to uncertainties and risks, including but not limited to: an increase in the frequency or severity of accidents or workers' compensation claims; unfavorable development of existing claims; dependence on independent sales agents; dependence on third-party capacity providers; disruptions or failures in our computer systems; a downturn in domestic or international economic growth or growth in the transportation sector; substantial industry competition; and other operational, financial or legal risks or uncertainties detailed in Landstar's Form 10K for the 2009 fiscal year, described in Item 1A Risk Factors, and other SEC filings from time-to-time.  These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated.  Investors should not place undue reliance on such forward-looking statements, and Landstar undertakes no obligation to publicly update or revise any forward-looking statements.

About Landstar:

Landstar System, Inc. is a non-asset based provider of integrated supply chain solutions. Landstar delivers safe, specialized transportation, warehousing and logistics services to a broad range of customers worldwide utilizing a network of agents, third-party capacity owners and employees. All Landstar transportation companies are certified to ISO 9001:2008 quality management system standards and RC14001:2008 environmental, health, safety and security management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market® under the symbol LSTR. www.landstar.com

SOURCE Landstar System, Inc.