Landstar System Reports Record Quarterly Revenue Of $868 Million And Record Quarterly Diluted Earnings Per Share From Continuing Operations Of $0.92

JACKSONVILLE, Fla., July 23, 2015 /PRNewswire/ -- Landstar System, Inc. (NASDAQ: LSTR) reported record quarterly diluted earnings per share from continuing operations of $0.92, on record quarterly revenue of $868 million in the 2015 second quarter. Landstar reported diluted earnings per share of $0.80 on revenue of $814 million in the 2014 second quarter. Gross profit (defined as revenue less the cost of purchased transportation and commissions to agents) was $130.8 million in the 2015 second quarter compared to $121.6 million of gross profit in the 2014 second quarter. Operating margin, representing operating income divided by gross profit, was 50.5 percent in the 2015 second quarter.

Truck transportation revenue hauled by independent business capacity owners ("BCOs") and truck brokerage carriers in the 2015 second quarter was $809.2 million, or 93 percent of revenue, compared to $764.7 million, or 94 percent of revenue, in the 2014 second quarter.  Truckload transportation revenue hauled via van equipment in the 2015 second quarter was $496.9 million compared to $458.7 million in the 2014 second quarter. Truckload transportation revenue hauled via unsided/platform equipment in the 2015 second quarter was $291.0 million compared to $285.5 million in the 2014 second quarter. Revenue hauled by rail, air and ocean cargo carriers was $48.1 million, or 6 percent of revenue, in the 2015 second quarter compared to $39.9 million, or 5 percent of revenue, in the 2014 second quarter. 

Trailing twelve-month return on average shareholders' equity was 30 percent and trailing twelve-month return on invested capital, net income divided by the sum of average equity plus average debt, was 25 percent.  Landstar purchased approximately 1,307,000 shares of its common stock during 2015 at an aggregate cost of $84.6 million. Currently, there are 3,000,000 shares of the Company's common stock available for purchase under Landstar's authorized share purchase program. As of June 27, 2015, the Company had $131 million in cash and short term investments and $192 million available for borrowings under the Company's senior credit facility.

In addition, Landstar announced today that its Board of Directors has declared a quarterly dividend of $0.08 per share payable on August 28, 2015, to stockholders of record as of the close of business on August 10, 2015.  This represents a 14 percent increase in the Company's quarterly dividend. It is currently the intention of the Board to pay dividends on a quarterly basis going forward.

"I am extremely pleased with our 2015 second quarter operating performance," said Landstar's President and Chief Executive Officer, Jim Gattoni. "Demand for Landstar's services was strong throughout the quarter. Revenue, gross profit, operating income and diluted earnings per share from continuing operations in the 2015 second quarter were all second quarter records. The number of loads hauled via truck exceeded the 2014 second quarter by 9 percent and the number of loads hauled via railroads, ocean cargo carriers and air cargo carriers increased 31 percent over the 2014 second quarter. The growth in the number of loads hauled via truck was driven by increased volumes for unsided/platform equipment, van equipment and less-than-truckload of 10 percent, 8 percent and 20 percent, respectively. As expected, revenue per load on loads hauled via truck softened in the 2015 second quarter as compared to the 2014 second quarter. Truck revenue per load in the 2015 second quarter was 3 percent lower as compared to the 2014 second quarter mostly due to the record truck revenue per load experienced in 2014 and the impact of lower diesel fuel costs on loads hauled via truck brokerage carriers in 2015. Operating income for the 2015 second quarter was $66.0 million, the highest second quarter operating income in Landstar history, and operating margin was 50.5 percent. Finally, diluted earnings per share in the 2015 second quarter increased 15 percent over the 2014 second quarter."

Gattoni continued, "Demand for Landstar's services thus far in July remains very strong. I expect the number of loads hauled via truck in the 2015 third quarter to increase in a mid-to-upper single digit percentage range over the 2014 third quarter.  As it pertains to revenue per load on loads hauled via truck, year-over-prior-year comparisons continue to be difficult due to the all-time high revenue per load reported in the 2014 third quarter along with the effect of lower diesel fuel costs on loads hauled via truck brokerage carriers in 2015.  During the first few weeks of fiscal July, revenue per load on loads hauled via truck is consistent with that experienced in fiscal June, yet lower than fiscal July 2014. I do not expect a significant change in these recent trends over the balance of the 2015 third quarter.  As such, I expect revenue per load on loads hauled via truck in the 2015 third quarter to be below the 2014 third quarter in a low-to-mid-single digit percentage range, as experienced in the first few weeks of July.  Assuming the current environment continues throughout the 2015 third quarter, I anticipate revenue for the 2015 third quarter to be in a range of $830 million to $880 million and, assuming that range of estimated revenue, I would anticipate 2015 third quarter diluted earnings per share to be in a range of $0.87 to $0.92 per share compared to $0.82 per diluted share in the 2014 third quarter."

Landstar will provide a live webcast of its quarterly earnings conference call this afternoon at 5:00 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 Second Quarter 2015 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 and expectations.  Terms such as "anticipates," "believes," "estimates," "intention," "expects," "plans," "predicts," "may," "should," "could," "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 other claims; unfavorable development of existing accident claims; dependence on third party insurance companies; dependence on independent commission sales agents; dependence on third party capacity providers; decreased demand for transportation services; substantial industry competition; disruptions or failures in the Company's computer systems; dependence on key vendors; changes in fuel taxes; status of independent contractors; regulatory and legislative changes; catastrophic loss of a Company facility; intellectual property; unclaimed property; and other operational, financial or legal risks or uncertainties detailed in Landstar's Form 10K for the 2014 fiscal year, described in Item 1A Risk Factors, and in 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 the Company undertakes no obligation to publicly update or revise any forward-looking statements.

About Landstar:

Landstar System, Inc. is an asset-light provider of integrated transportation management solutions delivering safe, specialized transportation services to a broad range of customers utilizing a network of agents, third party capacity owners and employees.  All Landstar transportation services companies are certified to ISO 9001:2008 quality management system standards and RC14001:2013 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

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SOURCE Landstar System, Inc.

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