EX-99.1 2 ex_359545.htm EXHIBIT 99.1 ex_359545.htm

 

Exhibit 99.1

 

 

ex_359545img001.jpg

 

 

J.B. Hunt Transport Services, Inc.

615 J.B. Hunt Corporate Drive

Lowell, Arkansas 72745

(NASDAQ: JBHT)

Contact: Brad Delco
Vice President – Finance & Investor Relations
(479) 820-2723

 

 

FOR IMMEDIATE RELEASE

 

 

 

J.B. HUNT TRANSPORT SERVICES, INC. REPORTS U.S. GAAP REVENUES, NET EARNINGS AND EARNINGS PER SHARE FOR THE FIRST QUARTER 2022

 

 

 

First Quarter 2022 Revenue:

$3.49 billion; up 33%
 

First Quarter 2022 Operating Income:

$334.3 million; up 61%
 

First Quarter 2022 EPS:

$2.29 vs. $1.37

 

LOWELL, Ark., April 18, 2022 - J.B. Hunt Transport Services, Inc. (NASDAQ: JBHT) announced first quarter 2022 U.S. GAAP (United States Generally Accepted Accounting Principles) net earnings of $243.3 million, or diluted earnings per share of $2.29 versus first quarter 2021 net earnings of $146.6 million, or $1.37 per diluted share.

 

Total operating revenue for the current quarter was $3.49 billion compared with $2.62 billion for the first quarter 2021. All segments contributed to the year-over-year increase in revenue. Truckload (JBT) and Integrated Capacity Solutions™ (ICS) grew revenue 77% and 29% year-over-year, respectively, as both segments were able to source capacity for customers by leveraging the talents and skills of our people and our investments in technology across the organization, including the Marketplace for J.B. Hunt 360°®. Intermodal (JBI) revenue grew 36%, driven by a 28% increase in revenue per load and complimented with a 7% increase in load volume. Dedicated Contract Services® (DCS®) revenue grew 28% as a result of a 20% increase in average revenue producing trucks and a 6% increase in fleet productivity versus the prior year period. Final Mile Services® (FMS) revenue increased 8% as strong demand for services in the segment were offset by supply-chain related challenges in most of the primary markets served. Current quarter total operating revenue, excluding fuel surcharge revenue, increased approximately 27% versus the first quarter 2021.

 

Total freight transactions in the Marketplace for J.B. Hunt 360 increased 36% to $600 million in the first quarter 2022 compared to $443 million in the prior year quarter. ICS revenue on the platform increased 20% to $430 million versus a year ago. JBT and JBI executed approximately $116 million and $54 million, an increase of 125% and 68% respectively, of their third-party dray, independent contractor and power-only capacity through the platform during the quarter.

 

Operating income for the current quarter increased 61% to $334.3 million versus $207.7 million for the first quarter 2021. Operating income increased from first quarter 2021 primarily due to higher volumes, customer rate and cost recovery efforts, and further scaling of investments in our people and technology, in addition to an approximately $18 million increase in gains on the sale of equipment year-over-year. These items were partially offset by increases in rail and truck purchased transportation costs, professional driver and non-driver wages and benefits, hiring and recruiting expense, and implementation costs for newly awarded business in both DCS and FMS segments.

 

 

 

Net interest expense for the current quarter increased approximately 5% from first quarter 2021 due to higher effective interest rates on our debt.

 

The effective income tax rate decreased to 24.4% in the current quarter compared to 25.1% in the first quarter 2021. We continue to expect our 2022 annual tax rate to be between 24.0% and 25.0%.

 

 

Segment Information:

 

Intermodal (JBI)

 First Quarter 2022 Segment Revenue:

$1.60 billion; up 36%

 First Quarter 2022 Operating Income:

$201.0 million; up 87%

 

Intermodal volumes increased 7% over the same period in 2021. Eastern network loads increased 10%, while transcontinental loads increased 5%. Volumes early in the quarter were negatively impacted by network fluidity issues attributable to labor challenges within the activities of our rail providers and customers, as well as our internal operations largely as a result of COVID-related disruptions. As the quarter progressed, volume levels strengthened as customer unloading activity improved, although rail network velocity continued to govern our ability to capitalize on even greater intermodal demand. Segment gross revenue increased 36% from the prior year period, reflecting the 7% increase in volume and a 28% increase in gross revenue per load, resulting from changes in the mix of freight, customer rates, and fuel surcharge revenues. Revenue per load excluding fuel surcharge revenue was up 21% year-over-year.

 

Operating income increased 87% in the first quarter from higher customer rate and cost recovery efforts and approximately $14 million of increased gains on the sale of equipment compared to the prior year period. Rate and cost recovery efforts were partially offset by higher rail and third-party dray purchased transportation costs, increases in professional driver and non-driver wages and benefits, higher driver-recruiting costs, as well as costs stemming from inefficiencies in the rail and port networks. During the period, we successfully onboarded approximately 4,350 new pieces of trailing equipment. We ended the quarter with approximately 109,300 containers and 6,340 power units in the dray fleet.

 

 

Dedicated Contract Services (DCS)     

First Quarter 2022 Segment Revenue:  $741 million; up 28%

First Quarter 2022 Operating Income:

$77.1 million; up 4%

 

DCS revenue increased 28% during the current quarter over the same period 2021. Productivity (revenue per truck per week) increased approximately 6% versus the prior period. Productivity excluding fuel surcharge revenue was flat from a year ago driven by increases in contracted indexed-based price escalators, offset by lower productivity of equipment on start-up accounts, COVID-related labor disruptions early in the quarter, and a greater number of open trucks as a result of a tight labor market. A net additional 2,221 revenue producing trucks were in the fleet by the end of the quarter compared to the prior year period, and a net additional 483 versus the end of the fourth quarter 2021. Customer retention rates remain above 98%.

 

Operating income increased 4% from the prior year quarter. Benefits from higher revenue and contracted indexed-based price escalators were mostly offset by increases in professional driver and non-driver wages and benefits, higher driver-recruiting costs, productivity headwinds due to COVID-related labor disruptions, and other costs related to the implementation of new, long-term contractual business.

 

 

 

Integrated Capacity Solutions (ICS)

First Quarter 2022 Segment Revenue:

$675 million; up 29%

First Quarter 2022 Operating Income:

$25.0 million; up 243%

 

ICS revenue increased 29% in the current quarter versus the first quarter 2021. Overall segment volumes increased 12% with truckload volumes increasing 15% versus the prior year period. Revenue per load increased 14% compared to the first quarter 2021 due to higher contractual and spot rates in our truckload business as well as changes in customer freight mix. Contractual volumes represented approximately 53% of the total load volume and 43% of the total revenue in the current quarter compared to 49% and 35%, respectively, in first quarter 2021. Of the total reported ICS revenue, approximately $430 million was executed through the Marketplace for J.B. Hunt 360 compared to $359 million in first quarter 2021.

 

Operating income increased 243% to $25.0 million compared to $7.3 million in the first quarter 2021. Benefits from higher revenue and gross margin were partially offset by higher personnel salary and wages, and further investments into platform infrastructure and development. Gross profit margins increased to 13.0% in the current period versus 12.4% in the prior period. ICS carrier base increased 36% year-over-year.

 

 

Truck (JBT)

First Quarter 2022 Segment Revenue:

$264 million; up 77%

First Quarter 2022 Operating Income:

$31.5 million; up 210%

 

JBT revenue increased 77% as compared to the same period in the previous year. Revenue excluding fuel surcharge revenue increased 72% primarily due to increased load volume and higher revenue per load excluding fuel surcharge revenue. Volume for JBT was up 17% year-over-year as total trailer count increased by approximately 3,000 units, or 36% versus the prior year period. Trailer turns in the quarter were down 13% from the prior period due to the onboarding of new trailers, freight mix and customer detention of equipment. Revenue per load excluding fuel surcharge revenue was up 47% on a 10% increase in length of haul. Both mix and same-store rate increases contributed to the increase in revenue quality.

 

JBT operating income increased 210% to $31.5 million versus $10.2 million in the first quarter 2021. JBT continues to leverage the J.B. Hunt 360 platform to grow power capacity and capability for the J.B. Hunt 360box® service offering. Benefits from higher volume and revenue quality led to an improvement in contribution margins across the segment. These benefits were partially offset by higher purchased transportation expense, trailer parts and maintenance costs, and continued technology investments to build out 360box.

 

 

Final Mile Services (FMS)

First Quarter 2022 Segment Revenue:

$218 million; up 8%

First Quarter 2022 Operating Income/(Loss):

$(0.2) million; compared to $8.5 million in Q121

 

FMS revenue increased 8% compared to the same period 2021 driven by the addition of multiple customer contracts implemented over the last year and complemented by the previously announced acquisition of Zenith Freight Lines that closed at the end of February. Revenue growth in the quarter was partially offset by supply-chain related constraints for goods in the primary markets served, in addition to internal efforts to improve revenue quality across certain accounts. FMS revenue increased 3% over the prior year period excluding the March acquisition, which contributed approximately $10 million to segment revenue in the quarter.

 

Operating income decreased to an operating loss of $0.2 million from $8.5 million of operating income in the prior year quarter. Higher revenue was more than offset by increases in professional driver and non-driver wages and benefits, implementation costs for newly awarded business, third-party contract carrier expense, driver-recruiting costs, and professional fees related to the Zenith acquisition.

 

 

 

Cash Flow and Capitalization:

 

At March 31, 2022, we had a total of $1.30 billion outstanding on various debt instruments which is comparable to the total debt levels at December 31, 2021.

 

Our net capital expenditures for the first quarter 2022 approximated $289 million compared to $86 million for the first quarter 2021. At March 31, 2022, we had cash and cash equivalents of $145 million.

 

In the first quarter 2022, we purchased approximately 382,000 shares of common stock for approximately $75 million. At March 31, 2022, we had approximately $276 million remaining under our share repurchase authorization. Actual shares outstanding at March 31, 2022, approximated 104.8 million.

 

 

Conference Call Information:

 

The Company will hold a conference call today from 4:00–5:00 pm CDT to discuss the quarterly earnings. Investors will have the opportunity to listen to the conference call live over the internet by going to investors.jbhunt.com. Please log on 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, an online replay of the earnings call webcast will be available a few hours after the completion of the call.

 

Forward-Looking Statements:

 

This press release may contain forward-looking statements, which are based on information currently available. Actual results may differ materially from those currently anticipated due to a number of factors, including, but not limited to, those discussed in Item 1A of our Annual Report filed on Form 10-K for the year ended December 31, 2021. We assume no obligation to update any forward-looking statement to the extent we become aware that it will not be achieved for any reason. This press release and additional information will be available to interested parties on our website, www.jbhunt.com.

 

About J.B. Hunt

 

J.B. Hunt Transport Services, Inc., an S&P 500 company, provides innovative supply chain solutions for a variety of customers throughout North America. Utilizing an integrated, multimodal approach, the company applies technology driven methods to create the best solution for each customer, adding efficiency, flexibility, and value to their operations. J.B. Hunt services include intermodal, dedicated, refrigerated, truckload, less-than-truckload, flatbed, single source, final mile, and more. J.B. Hunt Transport Services, Inc. stock trades on NASDAQ under the ticker symbol JBHT and is a component of the Dow Jones Transportation Average. J.B. Hunt Transport, Inc. is a wholly owned subsidiary of JBHT. For more information, visit www.jbhunt.com

 

 

 

logosm.jpg

J.B. HUNT TRANSPORT SERVICES, INC.  

Condensed Consolidated Statements of Earnings

(in thousands, except per share data)

(unaudited)

 

 

   

Three Months Ended March

 
   

2022

   

2021

 
           

% Of

           

% Of

 
   

Amount

   

Revenue

   

Amount

   

Revenue

 
                                 

Operating revenues, excluding fuel surcharge revenues

  $ 3,042,217             $ 2,388,034          

Fuel surcharge revenues

    446,371               230,115          

Total operating revenues

    3,488,588       100.0%       2,618,149       100.0%  
                                 

Operating expenses

                               

Rents and purchased transportation

    1,837,340       52.7%       1,352,301       51.7%  

Salaries, wages and employee benefits

    763,591       21.9%       620,032       23.7%  

Fuel and fuel taxes

    189,466       5.4%       113,040       4.3%  

Depreciation and amortization

    148,763       4.3%       137,545       5.3%  

Operating supplies and expenses

    106,939       3.1%       81,698       3.1%  

General and administrative expenses, net of asset dispositions

    37,447       0.9%       44,891       1.7%  

Insurance and claims

    46,131       1.3%       38,030       1.5%  

Operating taxes and licenses

    15,749       0.5%       13,814       0.5%  

Communication and utilities

    8,868       0.3%       9,146       0.3%  

Total operating expenses

    3,154,294       90.4%       2,410,497       92.1%  

Operating income

    334,294       9.6%       207,652       7.9%  

Net interest expense

    12,586       0.4%       12,024       0.4%  

Earnings before income taxes

    321,708       9.2%       195,628       7.5%  

Income taxes

    78,383       2.2%       49,022       1.9%  

Net earnings

  $ 243,325       7.0%     $ 146,606       5.6%  

Average diluted shares outstanding

    106,075               106,816          

Diluted earnings per share

  $ 2.29             $ 1.37          

 

 

Financial Information By Segment

(in thousands)

(unaudited)

 

   

Three Months Ended March

 
   

2022

   

2021

 
           

% Of

           

% Of

 
   

Amount

   

Total

   

Amount

   

Total

 
                                 

Revenue

                               
                                 

Intermodal

  $ 1,603,385       46%     $ 1,177,131       45%  

Dedicated

    741,306       21%       579,958       22%  

Integrated Capacity Solutions

    675,391       19%       524,946       20%  

Truckload

    264,343       8%       149,531       6%  

Final Mile Services

    218,454       6%       201,883       8%  

Subtotal

    3,502,879       100%       2,633,449       101%  

Intersegment eliminations

    (14,291 )     (0%)       (15,300 )     (1%)  

Consolidated revenue

  $ 3,488,588       100%     $ 2,618,149       100%  
                                 
                                 

Operating income

                               
                                 

Intermodal

  $ 200,972       60%     $ 107,468       52%  

Dedicated

    77,104       23%       74,339       36%  

Integrated Capacity Solutions

    24,963       8%       7,269       3%  

Truckload

    31,490       9%       10,173       5%  

Final Mile Services

    (180 )     (0%)       8,498       4%  

Other (1)

    (55 )     (0%)       (95 )     (0%)  

Operating income

  $ 334,294       100%     $ 207,652       100%  

 

 

(1) Includes corporate support activity

 

 

 

Operating Statistics by Segment

(unaudited)

 

   

Three Months Ended March

 
   

2022

   

2021

 
                 

Intermodal

               
                 

Loads

    510,736       478,285  

Average length of haul

    1,671       1,687  

Revenue per load

  $ 3,139     $ 2,461  

Average tractors during the period *

    6,262       5,718  

Tractors (end of period) *

    6,343       5,744  

Trailing equipment (end of period)

    109,329       99,043  

Average effective trailing equipment usage

    105,884       94,603  
                 
                 

Dedicated

               
                 

Loads

    1,041,842       942,220  

Average length of haul

    164       162  

Revenue per truck per week**

  $ 4,846     $ 4,576  

Average trucks during the period***

    11,946       9,961  

Trucks (end of period) ***

    12,172       9,951  

Trailing equipment (end of period)

    30,343       27,283  
                 
                 

Integrated Capacity Solutions

               
                 

Loads

    328,712       292,365  

Revenue per load

  $ 2,055     $ 1,796  

Gross profit margin

    13.0 %     12.4 %

Employee count (end of period)

    1,027       936  

Approximate number of third-party carriers (end of period)

    147,000       107,700  

Marketplace for J.B. Hunt 360 revenue (millions)

  $ 430.4     $ 359.0  
                 
                 

Truckload

               
                 

Loads

    120,527       103,062  

Average trailers during the period

    11,456       8,571  

Revenue per load

  $ 2,193     $ 1,451  

Average length of haul

    492       446  
                 

Tractors (end of period)

               

Company-owned

    709       798  

Independent contractor

    1,527       918  

Total tractors

    2,236       1,716  
                 

Trailers (end of period)

    11,655       8,571  
                 
                 

Final Mile Services

               
                 

Stops

    1,344,829       1,676,025  

Average trucks during the period***

    1,556       1,514  

 

 

* Includes company-owned and independent contractor tractors

** Using weighted workdays

*** Includes company-owned, independent contractor, and customer-owned trucks

 

 

 

J.B. HUNT TRANSPORT SERVICES, INC.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

 

   

March 31, 2022

   

December 31, 2021

 

ASSETS

               

Current assets:

               

Cash and cash equivalents

  $ 144,529     $ 355,549  

Accounts receivable, net

    1,745,647       1,506,619  

Prepaid expenses and other

    364,977       451,201  

Total current assets

    2,255,153       2,313,369  

Property and equipment

    6,950,327       6,680,316  

Less accumulated depreciation

    2,716,061       2,612,661  

Net property and equipment

    4,234,266       4,067,655  

Other assets, net

    542,522       413,324  
    $ 7,031,941     $ 6,794,348  
                 
                 

LIABILITIES & STOCKHOLDERS' EQUITY

               

Current liabilities:

               

Current debt

  $ 351,214     $ 355,972  

Trade accounts payable

    854,879       772,736  

Claims accruals

    309,949       307,210  

Accrued payroll and payroll taxes

    143,181       190,950  

Other accrued expenses

    125,507       102,732  

Total current liabilities

    1,784,730       1,729,600  
                 

Long-term debt

    945,628       945,257  

Other long-term liabilities

    294,314       256,233  

Deferred income taxes

    753,727       745,442  

Stockholders' equity

    3,253,542       3,117,816  
    $ 7,031,941     $ 6,794,348  

 

 

Supplemental Data

(unaudited)

 

   

March 31, 2022

   

December 31, 2021

 
                 

Actual shares outstanding at end of period (000)

    104,783       105,094  
                 

Book value per actual share outstanding at end of period

  $ 31.05     $ 29.67  

 

   

Three Months Ended March

 
   

2022

   

2021

 
                 

Net cash provided by operating activities (000)

  $ 291,785     $ 364,658  
                 

Net capital expenditures (000)

  $ 289,126     $ 85,854