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Marten Transport Announces Third Quarter Results
Source: Nasdaq GlobeNewswire / 18 Oct 2023 16:02:50 America/New_York
MONDOVI, Wis., Oct. 18, 2023 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported net income of $13.6 million, or 17 cents per diluted share, for the third quarter ended September 30, 2023, compared with $25.6 million, or 32 cents per diluted share, for the third quarter of 2022. For the nine-month period ended September 30, 2023, net income was $58.0 million, or 71 cents per diluted share, compared with $84.8 million, or $1.03 per diluted share, for the 2022 nine-month period.
Operating revenue was $279.5 million for the third quarter of 2023 compared with $324.4 million for the third quarter of 2022. Excluding fuel surcharges, operating revenue was $239.1 million for the 2023 quarter compared with $269.3 million for the 2022 quarter. Fuel surcharge revenue decreased to $40.5 million for the 2023 quarter from $55.1 million for the 2022 quarter.
Operating revenue was $863.2 million for the first nine months of 2023 compared with $941.3 million for the first nine months of 2022. Excluding fuel surcharges, operating revenue was $742.6 million for the 2023 period compared with $783.8 million for the 2022 period. Fuel surcharge revenue decreased to $120.6 million for the 2023 period from $157.5 million for the 2022 period.
Operating income was $17.2 million for the third quarter of 2023 compared with $33.8 million for the third quarter of 2022. For the first nine months of 2023, operating income was $74.5 million compared with $110.6 million for the first nine months of 2022.
Operating expenses as a percentage of operating revenue were 93.8% for the 2023 quarter and 89.6% for the 2022 quarter. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 92.8% for the 2023 quarter and 87.5% for the 2022 quarter.
Operating expenses as a percentage of operating revenue were 91.4% for the first nine months of 2023 and 88.3% for the first nine months of 2022. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 90.0% for the 2023 period and 85.9% for the 2022 period.
Executive Chairman Randolph L. Marten stated, “Our earnings this quarter were significantly pressured by the industry-wide weak demand, cumulative impact of reduced freight rates with the resulting freight network disruption, and inflationary operating costs within the current freight market recession. Additionally, the record heat and rising fuel prices each month of the third quarter led to an increase in our mile-adjusted net fuel expense of $3.9 million, or 4 cents per diluted share, from this year’s second quarter to third quarter.”
“We are focused on both minimizing the current freight market’s impact on our operations, and investing in and positioning our premium service solutions to capitalize on profitable organic growth opportunities as the market necessarily recovers - with fair compensation for our services. To that end, we have not agreed to any rate reductions since early August.”
Marten Transport, with headquarters in Mondovi, Wis., is a multifaceted business offering a network of refrigerated and dry truck-based transportation capabilities across Marten’s five distinct business platforms - Truckload, Dedicated, Intermodal, Brokerage and MRTN de Mexico. Marten is one of the leading temperature-sensitive truckload carriers in the United States, specializing in transporting and distributing food, beverages and other consumer packaged goods that require a temperature-controlled or insulated environment. The Company offers service in the United States, Mexico and Canada, concentrating on expedited movements for high-volume customers. Marten’s common stock is traded on the Nasdaq Global Select Market under the symbol MRTN.
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include a discussion of Marten’s prospects for future growth and by their nature involve substantial risks and uncertainties, and actual results may differ materially from those expressed in such forward-looking statements. Important factors known to the Company that could cause actual results to differ materially from those discussed in the forward-looking statements are discussed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise.
MARTEN TRANSPORT, LTD. CONSOLIDATED CONDENSED BALANCE SHEETS September 30, December 31, (In thousands, except share information) 2023 2022 (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 68,067 $ 80,600 Receivables: Trade, net 117,820 120,702 Other 11,695 7,218 Prepaid expenses and other 27,004 27,320 Total current assets 224,586 235,840 Property and equipment: Revenue equipment, buildings and land, office equipment and other 1,129,415 1,074,832 Accumulated depreciation (358,414 ) (346,665 ) Net property and equipment 771,001 728,167 Other noncurrent assets 1,617 1,672 Total assets $ 997,204 $ 965,679 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 42,042 $ 37,299 Insurance and claims accruals 46,282 45,747 Accrued and other current liabilities 33,320 41,264 Total current liabilities 121,644 124,310 Deferred income taxes 125,887 137,041 Noncurrent operating lease liabilities 316 409 Total liabilities 247,847 261,760 Stockholders’ equity: Preferred stock, $.01 par value per share; 2,000,000 shares authorized; no shares issued and outstanding - - Common stock, $.01 par value per share; 192,000,000 shares authorized; 81,308,968 shares at September 30, 2023, and 81,115,132 shares at December 31, 2022, issued and outstanding 813 811 Additional paid-in capital 49,280 47,188 Retained earnings 699,264 655,920 Total stockholders’ equity 749,357 703,919 Total liabilities and stockholders’ equity $ 997,204 $ 965,679 MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)Three Months Nine Months Ended September 30, Ended September 30, (In thousands, except per share information) 2023 2022 2023 2022 Operating revenue $ 279,538 $ 324,448 $ 863,233 $ 941,294 Operating expenses (income): Salaries, wages and benefits 92,620 99,773 287,468 285,582 Purchased transportation 49,673 64,403 152,075 189,193 Fuel and fuel taxes 48,695 57,299 137,706 163,004 Supplies and maintenance 17,896 14,855 51,291 40,520 Depreciation 29,017 28,381 87,974 81,389 Operating taxes and licenses 2,821 2,748 8,345 8,051 Insurance and claims 13,254 11,949 40,805 38,096 Communications and utilities 2,584 2,135 7,625 6,639 Gain on disposition of revenue equipment (3,014 ) (1,070 ) (11,810 ) (10,422 ) Other 8,762 10,209 27,301 28,681 Total operating expenses 262,308 290,682 788,780 830,733 Operating income 17,230 33,766 74,453 110,561 Other (1,017 ) (264 ) (2,938 ) (307 ) Income before income taxes 18,247 34,030 77,391 110,868 Income taxes expense 4,649 8,384 19,417 26,028 Net income $ 13,598 $ 25,646 $ 57,974 $ 84,840 Basic earnings per common share $ 0.17 $ 0.32 $ 0.71 $ 1.04 Diluted earnings per common share $ 0.17 $ 0.32 $ 0.71 $ 1.03 Dividends declared per common share $ 0.06 $ 0.06 $ 0.18 $ 0.18 MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)Dollar Percentage Change Change Three Months Three Months Three Months Ended Ended Ended September 30, September 30, September 30, (Dollars in thousands) 2023 2022 2023 vs. 2022 2023 vs. 2022 Operating revenue: Truckload revenue, net of fuel surcharge revenue $ 96,516 $ 105,905 $ (9,389 ) (8.9 )% Truckload fuel surcharge revenue 17,711 23,471 (5,760 ) (24.5 ) Total Truckload revenue 114,227 129,376 (15,149 ) (11.7 ) Dedicated revenue, net of fuel surcharge revenue 82,963 86,178 (3,215 ) (3.7 ) Dedicated fuel surcharge revenue 18,834 24,039 (5,205 ) (21.7 ) Total Dedicated revenue 101,797 110,217 (8,420 ) (7.6 ) Intermodal revenue, net of fuel surcharge revenue 18,122 24,303 (6,181 ) (25.4 ) Intermodal fuel surcharge revenue 3,925 7,600 (3,675 ) (48.4 ) Total Intermodal revenue 22,047 31,903 (9,856 ) (30.9 ) Brokerage revenue 41,467 52,952 (11,485 ) (21.7 ) Total operating revenue $ 279,538 $ 324,448 $ (44,910 ) (13.8 )% Operating income/(loss): Truckload $ 2,738 $ 14,319 $ (11,581 ) (80.9 )% Dedicated 11,286 13,005 (1,719 ) (13.2 ) Intermodal (1,074 ) 778 (1,852 ) (238.0 ) Brokerage 4,280 5,664 (1,384 ) (24.4 ) Total operating income $ 17,230 $ 33,766 $ (16,536 ) (49.0 )% Operating ratio: Truckload 97.6 % 88.9 % Dedicated 88.9 88.2 Intermodal 104.9 97.6 Brokerage 89.7 89.3 Consolidated operating ratio 93.8 % 89.6 % Operating ratio, net of fuel surcharges: Truckload 97.2 % 86.5 % Dedicated 86.4 84.9 Intermodal 105.9 96.8 Brokerage 89.7 89.3 Consolidated operating ratio, net of fuel surcharges 92.8 % 87.5 % MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)Dollar Percentage Change Change Nine Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, (Dollars in thousands) 2023 2022 2023 vs. 2022 2023 vs. 2022 Operating revenue: Truckload revenue, net of fuel surcharge revenue $ 300,104 $ 302,883 $ (2,779 ) (0.9 )% Truckload fuel surcharge revenue 51,887 66,255 (14,368 ) (21.7 ) Total Truckload revenue 351,991 369,138 (17,147 ) (4.6 ) Dedicated revenue, net of fuel surcharge revenue 257,231 248,988 8,243 3.3 Dedicated fuel surcharge revenue 56,000 68,344 (12,344 ) (18.1 ) Total Dedicated revenue 313,231 317,332 (4,101 ) (1.3 ) Intermodal revenue, net of fuel surcharge revenue 60,277 77,589 (17,312 ) (22.3 ) Intermodal fuel surcharge revenue 12,724 22,923 (10,199 ) (44.5 ) Total Intermodal revenue 73,001 100,512 (27,511 ) (27.4 ) Brokerage revenue 125,010 154,312 (29,302 ) (19.0 ) Total operating revenue $ 863,233 $ 941,294 $ (78,061 ) (8.3 )% Operating income/(loss): Truckload $ 22,348 $ 45,978 $ (23,630 ) (51.4 )% Dedicated 39,143 37,689 1,454 3.9 Intermodal (452 ) 9,911 (10,363 ) (104.6 ) Brokerage 13,414 16,983 (3,569 ) (21.0 ) Total operating income $ 74,453 $ 110,561 $ (36,108 ) (32.7 )% Operating ratio: Truckload 93.7 % 87.5 % Dedicated 87.5 88.1 Intermodal 100.6 90.1 Brokerage 89.3 89.0 Consolidated operating ratio 91.4 % 88.3 % Operating ratio, net of fuel surcharges: Truckload 92.6 % 84.8 % Dedicated 84.8 84.9 Intermodal 100.7 87.2 Brokerage 89.3 89.0 Consolidated operating ratio, net of fuel surcharges 90.0 % 85.9 % MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)Three Months Nine Months Ended September 30, Ended September 30, 2023 2022 2023 2022 Truckload Segment: Revenue (in thousands) $ 114,227 $ 129,376 $ 351,991 $ 369,138 Average revenue, net of fuel surcharges, per tractor per week(1) $ 4,285 $ 4,889 $ 4,442 $ 4,980 Average tractors(1) 1,714 1,648 1,732 1,560 Average miles per trip 529 508 515 512 Non-revenue miles percentage(2) 12.1 % 11.3 % 12.4 % 10.8 % Total miles (in thousands) 39,093 38,441 116,651 110,565 Dedicated Segment: Revenue (in thousands) $ 101,797 $ 110,217 $ 313,231 $ 317,332 Average revenue, net of fuel surcharges, per tractor per week(1) $ 3,900 $ 4,006 $ 3,949 $ 3,977 Average tractors(1) 1,619 1,637 1,670 1,605 Average miles per trip 339 337 335 340 Non-revenue miles percentage(2) 1.3 % 1.2 % 1.2 % 1.1 % Total miles (in thousands) 33,039 34,513 101,948 101,400 Intermodal Segment: Revenue (in thousands) $ 22,047 $ 31,903 $ 73,001 $ 100,512 Loads 6,327 7,610 19,871 24,607 Average tractors 154 182 168 173 Brokerage Segment: Revenue (in thousands) $ 41,467 $ 52,952 $ 125,010 $ 154,312 Loads 24,077 24,896 67,483 69,902 At September 30, 2023 and September 30, 2022: Total tractors(1) 3,454 3,575 Average age of company tractors (in years) 1.8 1.7 Total trailers 5,726 5,679 Average age of company trailers (in years) 4.4 3.8 Ratio of trailers to tractors(1) 1.7 1.6 Total refrigerated containers 788 803 Three Months Nine Months Ended September 30, Ended September 30, (In thousands) 2023 2022 2023 2022 Net cash provided by operating activities $ 28,132 $ 64,551 $ 126,333 $ 163,221 Net cash (used for) investing activities (35,831 ) (57,412 ) (124,470 ) (92,416 ) Net cash (used for) financing activities (4,762 ) (4,021 ) (14,396 ) (56,308 ) Weighted average shares outstanding: Basic 81,306 81,061 81,260 81,889 Diluted 81,454 81,347 81,414 82,155 (1) Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 99 and 90 tractors as of September 30, 2023 and 2022, respectively. (2) Represents the percentage of miles for which the company is not compensated. CONTACTS: Tim Kohl, Chief Executive Officer, Doug Petit, President, and Jim Hinnendael, Executive Vice President and Chief Financial Officer, of Marten Transport, Ltd., 715-926-4216.