Marten Transport Announces Fourth Quarter and Year End Results

MONDOVI, Wis., Jan. 26, 2017 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported net income of $8.3 million, or 25 cents per diluted share, for the fourth quarter of 2016 compared with $8.8 million, or 26 cents per diluted share, for the fourth quarter of 2015. Net income was $33.5 million, or $1.02 per diluted share, for the year ended December 31, 2016 compared with $35.7 million, or $1.06 per diluted share, for 2015. Results for 2015 included a gain on the disposition of facilities of $392,000 for the fourth quarter and $4.1 million for the year. Net income improved to $33.5 million in 2016 from $33.3 million, or 99 cents per diluted share, in 2015 excluding the facilities gain.

Operating revenue improved 2.3% to $172.7 million for the fourth quarter of 2016 from $168.8 million for the fourth quarter of 2015, and improved 0.9% to $671.1 million for 2016 from $665.0 million for 2015, despite lower fuel surcharges due to decreased fuel prices in 2016. Operating revenue, net of fuel surcharges, improved 2.2% to $157.4 million for the 2016 quarter from $154.0 million for the 2015 quarter, and increased 4.3% to $617.9 million for 2016 from $592.6 million for 2015. Fuel surcharge revenue increased to $15.3 million for the fourth quarter of 2016 from $14.7 million for the 2015 quarter, and decreased 26.4% to $53.2 million for 2016 from $72.3 million for 2015.

Operating expenses as a percentage of operating revenue was 91.6% for the fourth quarter of 2016 and 91.0% for the fourth quarter of 2015. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, was 90.8% for the fourth quarter of 2016. The operating ratio, net of both fuel surcharges and the gain on the facility disposition, was 90.4% for the fourth quarter of 2015.

Operating expenses as a percentage of operating revenue was 91.3% for 2016 and 90.8% for 2015. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, was 90.6% for 2016. The operating ratio, net of both fuel surcharges and the gain on the facility dispositions, was 90.4% for 2015.

Chairman and Chief Executive Officer Randolph L. Marten said, “Despite persistent softness in the freight market, which has challenged our truckload segment, we have continued to demonstrate the strength of our unique multifaceted business model by achieving our eighth consecutive year-over-year increase in quarterly operating income within each of our dedicated, intermodal and brokerage segments. We increased our average number of truckload and dedicated tractors by 226 tractors, or 9.1%, in 2016 over 2015 with the expansion of our dedicated operations. We remain confident in our ability to profitably capitalize on growth opportunities across all of our business units with our competitive position, cost control emphasis, modern fleet and strong balance sheet.”

Marten Transport, with headquarters in Mondovi, Wis., is one of the leading temperature-sensitive truckload carriers in the United States, specializing in transporting and distributing food and other consumer packaged goods that require a temperature-controlled or insulated environment. Marten’s dry freight services are expanding, with 921 dry trailers operating as of December 31, 2016. Marten offers service in the United States, Canada and Mexico, 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 our discussion of the Company’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 Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. 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
(Unaudited)
December 31, December 31,
(In thousands, except share information) 2016 2015
ASSETS
Current assets:
Cash and cash equivalents $488 $434
Receivables:
Trade, net 69,199 70,597
Other 4,436 10,885
Prepaid expenses and other 19,307 18,134
Total current assets 93,430 100,050
Property and equipment:
Revenue equipment, buildings and land,
office equipment and other 759,553 724,597
Accumulated depreciation (201,728) (196,588)
Net property and equipment 557,825 528,009
Other assets 2,493 3,469
Total assets $653,748 $631,528
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities $41,230 $33,641
Insurance and claims accruals 19,440 16,235
Total current liabilities 60,670 49,876
Long-term debt 7,886 37,867
Deferred income taxes 147,854 134,364
Total liabilities 216,410 222,107
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;
96,000,000 shares authorized; 32,634,915 shares
at December 31, 2016, and 32,759,806 shares at
December 31, 2015, issued and outstanding 326 328
Additional paid-in capital 74,175 76,468
Retained earnings 362,837 332,625
Total stockholders’ equity 437,338 409,421
Total liabilities and stockholders’ equity $653,748 $631,528


MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Year
Ended December 31, Ended December 31,
(In thousands, except per share information) 2016 2015 2016 2015
Operating revenue $172,661 $168,773 $671,144 $664,994
Operating expenses (income):
Salaries, wages and benefits 56,711 54,554 224,827 209,455
Purchased transportation 28,722 29,687 110,719 118,030
Fuel and fuel taxes 25,670 23,269 94,075 104,582
Supplies and maintenance 10,887 10,584 43,912 43,319
Depreciation 21,240 19,854 82,445 75,323
Operating taxes and licenses 2,367 2,729 9,099 8,914
Insurance and claims 8,978 7,279 32,223 29,252
Communications and utilities 1,586 1,539 6,287 5,886
Gain on disposition of revenue equipment (3,040) (741) (10,502) (5,584)
Gain on disposition of facilities - (392) - (4,104)
Other 5,007 5,174 19,756 18,858
Total operating expenses 158,128 153,536 612,841 603,931
Operating income 14,533 15,237 58,303 61,063
Other 443 225 1,237 372
Income before income taxes 14,090 15,012 57,066 60,691
Provision for income taxes 5,787 6,222 23,602 24,946
Net income $8,303 $8,790 $33,464 $35,745
Basic earnings per common share $0.25 $0.26 $1.03 $1.07
Diluted earnings per common share $0.25 $0.26 $1.02 $1.06
Dividends declared per common share $0.025 $0.025 $0.10 $0.10

MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
Dollar Percentage
Change Change
Three Months Three Months Three Months
Ended Ended Ended
December 31, December 31, December 31,
(Dollars in thousands) 2016 2015 2016 vs. 2015 2016 vs. 2015
Operating revenue:
Truckload revenue, net of fuel
surcharge revenue $86,453 $85,874 $579 0.7%
Truckload fuel surcharge revenue 10,113 9,964 149 1.5
Total Truckload revenue 96,566 95,838 728 0.8
Dedicated revenue, net of fuel
surcharge revenue 37,174 33,323 3,851 11.6
Dedicated fuel surcharge revenue 3,188 2,677 511 19.1
Total Dedicated revenue 40,362 36,000 4,362 12.1
Intermodal revenue, net of fuel
surcharge revenue 16,155 15,599 556 3.6
Intermodal fuel surcharge revenue 1,992 2,090 (98) (4.7)
Total Intermodal revenue 18,147 17,689 458 2.6
Brokerage revenue 17,586 19,246 (1,660) (8.6)
Total operating revenue $172,661 $168,773 $3,888 2.3%
Operating income:
Truckload $7,038 $7,903 $(865) (10.9)%
Dedicated 4,587 4,322 265 6.1
Intermodal 1,735 1,460 275 18.8
Brokerage 1,173 1,160 13 1.1
Total operating income before gain
on disposition of facilities 14,533 14,845 (312) (2.1)
Gain on disposition of facilities - 392 (392) (100.0)
Total operating income $14,533 $15,237 $(704) (4.6)%
Operating ratio:
Truckload 92.7% 91.8%
Dedicated 88.6 88.0
Intermodal 90.4 91.7
Brokerage 93.3 94.0
Consolidated operating ratio before
gain on disposition of facilities 91.6% 91.2%
Consolidated operating ratio 91.6% 91.0%


MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
Dollar Percentage
Change Change
Year Year Year
Ended Ended Ended
December 31, December 31, December 31,
(Dollars in thousands) 2016 2015 2016 vs. 2015 2016 vs. 2015
Operating revenue:
Truckload revenue, net of fuel
surcharge revenue $339,967 $348,101 $ (8,134) (2.3)%
Truckload fuel surcharge revenue 35,884 50,260 (14,376) (28.6)
Total Truckload revenue 375,851 398,361 (22,510) (5.7)
Dedicated revenue, net of fuel
surcharge revenue 147,007 107,264 39,743 37.1
Dedicated fuel surcharge revenue 10,363 11,008 (645) (5.9)
Total Dedicated revenue 157,370 118,272 39,098 33.1
Intermodal revenue, net of fuel
surcharge revenue 64,508 65,877 (1,369) (2.1)
Intermodal fuel surcharge revenue 6,982 11,081 (4,099) (37.0)
Total Intermodal revenue 71,490 76,958 (5,468) (7.1)
Brokerage revenue 66,433 71,403 (4,970) (7.0)
Total operating revenue $671,144 $664,994 $ 6,150 0.9%
Operating income:
Truckload $27,438 $35,517 $ (8,079) (22.7)%
Dedicated 19,550 12,818 6,732 52.5
Intermodal 7,131 4,832 2,299 47.6
Brokerage 4,184 3,792 392 10.3
Total operating income before gain
on disposition of facilities 58,303 56,959 1,344 2.4
Gain on disposition of facilities - 4,104 (4,104) (100.0)
Total operating income $58,303 $61,063 $ (2,760) (4.5)%
Operating ratio:
Truckload 92.7% 91.1%
Dedicated 87.6 89.2
Intermodal 90.0 93.7
Brokerage 93.7 94.7
Consolidated operating ratio before
gain on disposition of facilities 91.3% 91.4%
Consolidated operating ratio 91.3% 90.8%


MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)
Three Months Year
Ended December 31, Ended December 31,
2016 2015 2016 2015
Truckload Segment:
Revenue (in thousands) $96,566 $95,838 $375,851 $398,361
Average revenue, net of fuel surcharges,
per tractor per week(1) $3,456 $3,400 $3,427 $3,529
Average tractors(1) 1,903 1,921 1,898 1,892
Average miles per trip 608 639 623 666
Non-revenue miles percentage(2) 9.1% 9.4% 9.2% 9.4%
Total miles (in thousands) 46,786 45,098 184,281 186,268
Dedicated Segment:
Revenue (in thousands) $40,362 $36,000 $157,370 $118,272
Average revenue, net of fuel surcharges,
per tractor per week(1) $3,448 $3,405 $3,432 $3,433
Average tractors(1) 820 745 819 599
Average miles per trip 295 324 301 347
Non-revenue miles percentage(2) 0.8% 1.5% 0.8% 1.6%
Total miles (in thousands) 18,826 17,499 75,333 57,381
Intermodal Segment:
Revenue (in thousands) $18,147 $17,689 $71,490 $76,958
Loads 9,273 8,639 35,947 36,404
Average tractors 76 82 76 89
Brokerage Segment:
Revenue (in thousands) $17,586 $19,246 $66,433 $71,403
Loads 12,926 13,228 49,721 48,060
At December 31, 2016 and December 31, 2015:
Total tractors(1) 2,785 2,740
Average age of company tractors (in years) 1.4 1.5
Total trailers 4,854 4,700
Average age of company trailers (in years) 2.7 2.6
Ratio of trailers to tractors(1) 1.7 1.7
Three Months Year
Ended December 31, Ended December 31,
(In thousands) 2016 2015 2016 2015
Net cash provided by operating activities $29,425 $26,816 $133,566 $128,238
Net cash (used for) investing activities (28,448) (21,555) (97,290) (125,081)
Net cash (used for) financing activities (664) (4,972) (36,222) (2,846)
Weighted average shares outstanding:
Basic 32,598 33,248 32,506 33,477
Diluted 32,770 33,434 32,677 33,715

(1) Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 68 and 65 tractors as of December 31, 2016 and 2015, respectively.

(2) Represents the percentage of miles for which the company is not compensated.

CONTACTS: Tim Kohl, President, and Jim Hinnendael, Executive Vice President and Chief Financial Officer, of Marten Transport, Ltd., 715-926-4216.

Source:Marten Transport, Ltd.