News Column

Marten Transport Announces Second Quarter Results

July 15, 2014

MONDOVI, Wis., July 15, 2014 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq:MRTN) today reported an increase in net income to $7.9 million, or 24 cents per diluted share, in the second quarter ended June 30, 2014, from $7.7 million, or 23 cents per diluted share, in the second quarter of 2013. For the six-month period ended June 30, 2014, net income was $13.2 million, or 39 cents per diluted share, compared with $14.9 million, or 45 cents per diluted share, in the 2013 six-month period.

Operating revenue, consisting of revenue from truckload and logistics operations, increased to $168.4 million in the second quarter of 2014 from $161.4 million in the second quarter of 2013, and increased to $327.8 million in the 2014 six-month period from $325.9 million in the 2013 six-month period. Operating revenue, net of fuel surcharges and MW Logistics, LLC (MWL) revenue, increased 4.6% to $135.7 million in the 2014 quarter from $129.7 million in the 2013 quarter, and increased 2.9% to $263.2 million in the 2014 six-month period from $255.8 million in the 2013 six-month period. Fuel surcharge revenue increased to $32.7 million in the second quarter of 2014 from $31.7 million in the 2013 quarter, and increased to $64.6 million in the 2014 six-month period from $63.4 million in the 2013 six-month period. With the March 2013 deconsolidation of MWL, no MWL revenue was included in the first six months of 2014 or in the second quarter of 2013, compared with $6.7 million in the first six months of 2013.

Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharge revenue, was 90.5% in the second quarter of 2014 compared with the 89.9% ratio achieved in the second quarter of 2013. The ratio was 91.8% in the 2014 six-month period compared with 90.2% in the 2013 six-month period.

Chairman and Chief Executive Officer Randolph L. Marten said, "We remain confident that we are well positioned for the remainder of 2014 and beyond with our rate initiatives that will continue through this year's third quarter, as the operating environment is becoming more favorable with tightening capacity. We are encouraged by our strong June 2014 performance with net income for the month of $3.1 million, and our opportunity for further profitability growth with our diverse service infrastructure. We continue to drive gains in our key operating measures as our revenue per tractor increased 4.1% over the second quarter of 2013, our seventeenth consecutive quarterly increase."

"We also utilized our credit facility in the second quarter of 2014 to acquire a larger regional operating facility in southern California, which we believe will give us the ability to further expand our footprint in that market."

Marten Transport, with headquarters in Mondovi, Wis., is one of the leading temperature-sensitive truckload carriers in the United States. Marten specializes in transporting and distributing food and other consumer packaged goods that require a temperature-controlled or insulated environment. 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.

Since 2004, Marten Transport's results and consolidated financial statements have included the accounts of MWL, a third-party provider of logistics services to the transportation industry. On March 28, 2013, a member of MWL made a capital contribution to MWL. As a result, it was determined that MWL was no longer required to be consolidated. Accordingly, Marten deconsolidated MWL and started accounting for its ownership interest in MWL under the equity method of accounting, effective as of that date.

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 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, 2013. 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)
     
 June 30,December 31,
(In thousands, except share information) 2014 2013
     
ASSETS    
Current assets:    
Cash and cash equivalents  $ 956  $ 13,650
Receivables:    
Trade, net 75,176 70,869
Other 6,459 4,142
Prepaid expenses and other 13,949 15,274
Deferred income taxes 3,545 3,415
Total current assets 100,085 107,350
     
Property and equipment:    
Revenue equipment, buildings and land, office equipment and other 632,693 579,925
Accumulated depreciation  (174,627)  (164,916)
Net property and equipment 458,066 415,009
Other assets 3,991 3,443
TOTAL ASSETS  $ 562,142  $ 525,802
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
Current liabilities:    
Accounts payable and accrued liabilities  $ 42,063  $ 38,624
Insurance and claims accruals 15,012 14,404
Total current liabilities 57,075 53,028
Long-term debt, less current maturities 16,757 --
Deferred income taxes 115,918 113,637
Total liabilities 189,750 166,665
     
     
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; 48,000,000 shares authorized; 33,398,329 shares at June 30, 2014, and 33,301,048 shares at December 31, 2013, issued and outstanding 334 333
Additional paid-in capital 86,787 85,077
Retained earnings 285,271 273,727
Total stockholders' equity 372,392 359,137
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $ 562,142  $ 525,802
     
     
MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
         
   Three Months  Six Months
   Ended June 30,   Ended June 30, 
(In thousands, except per share information) 2014 2013 2014 2013
         
OPERATING REVENUE  $ 168,423  $ 161,413  $ 327,832  $ 325,887
         
OPERATING EXPENSES (INCOME):        
Salaries, wages and benefits 44,667 42,345 88,399 84,470
Purchased transportation 30,739 28,129 58,869 62,313
Fuel and fuel taxes 40,494 40,596 80,320 80,919
Supplies and maintenance 10,351 9,998 20,786 19,531
Depreciation 16,865 16,219 33,236 31,907
Operating taxes and licenses 1,728 1,825 3,441 3,595
Insurance and claims 6,663 5,808 12,788 11,619
Communications and utilities 1,311 1,262 2,744 2,545
Gain on disposition of revenue equipment (1,278) (1,237) (1,941) (3,652)
Other 3,951 3,347 7,618 6,981
         
Total operating expenses 155,491 148,292 306,260 300,228
         
OPERATING INCOME 12,932 13,121 21,572 25,659
         
OTHER (612) (153) (710) (168)
         
INCOME BEFORE INCOME TAXES 13,544 13,274 22,282 25,827
Less: Income before income taxes attributable to noncontrolling interest -- -- -- 84
         
INCOME BEFORE INCOME TAXES ATTRIBUTABLE TO MARTEN TRANSPORT, LTD. 13,544 13,274 22,282 25,743
         
PROVISION FOR INCOME TAXES 5,618 5,607 9,069 10,874
         
NET INCOME  $ 7,926  $ 7,667  $ 13,213  $ 14,869
         
BASIC EARNINGS PER COMMON SHARE  $ 0.24  $ 0.23  $ 0.40  $ 0.45
         
DILUTED EARNINGS PER COMMON SHARE  $ 0.24  $ 0.23  $ 0.39  $ 0.45
         
DIVIDENDS DECLARED PER COMMON SHARE  $ 0.025  $ 0.017  $ 0.050  $ 0.033
         
         
MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
         
       Dollar Percentage
       Change Change
   Three Months Three Months Three Months
  Ended Ended Ended
 June 30,June 30,June 30,
(Dollars in thousands) 2014 2013 2014 vs. 2013 2014 vs. 2013
Operating revenue:        
Truckload revenue, net of fuel surcharge revenue$102,161$99,996$2,165 2.2%
Truckload fuel surcharge revenue 26,944 26,856 88 0.3
Total Truckload revenue 129,105 126,852 2,253 1.8
         
Logistics revenue, net of intermodal fuel surcharge revenue 33,518 29,721 3,797 12.8
Intermodal fuel surcharge revenue 5,800 4,840 960 19.8
Total Logistics revenue 39,318 34,561 4,757 13.8
         
Total operating revenue$168,423$161,413$7,010 4.3%
         
Operating income:        
Truckload$11,843$11,376$467 4.1%
Logistics 1,089 1,745 (656) (37.6)
Total operating income$12,932$13,121$(189) (1.4)%
         
Operating ratio:        
Truckload 90.8% 91.0%    
Logistics 97.2 95.0    
Consolidated operating ratio 92.3% 91.9%    
         
         
MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
         
       Dollar Percentage
       Change  Change
   Six Months Six Months Six Months
   Ended Ended Ended
   June 30,June 30,June 30,
(Dollars in thousands) 2014 2013 2014 vs. 2013 2014 vs. 2013
Operating revenue:        
Truckload revenue, net of fuel surcharge revenue$199,691$194,961$4,730 2.4%
Truckload fuel surcharge revenue 53,478 53,625 (147) (0.3)
Total Truckload revenue 253,169 248,586 4,583 1.8
         
Logistics revenue, net of intermodal fuel surcharge revenue 63,527 67,481 (3,954) (5.9)
Intermodal fuel surcharge revenue 11,136 9,820 1,316 13.4
Total Logistics revenue 74,663 77,301 (2,638) (3.4)
         
Total operating revenue$327,832$325,887$1,945 0.6%
         
Operating income:        
Truckload$19,343$21,376$(2,033) (9.5)%
Logistics 2,229 4,283 (2,054) (48.0)
Total operating income$21,572$25,659$(4,087) (15.9)%
         
Operating ratio:        
Truckload 92.4% 91.4%    
Logistics 97.0 94.5    
Consolidated operating ratio 93.4% 92.1%    
         
         
MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)
         
   Three Months  Six Months
   Ended June 30,  Ended June 30,
  2014 2013 2014 2013
Truckload Segment:        
Total Truckload revenue (in thousands)$129,105$126,852$253,169$248,586
Average truckload revenue, net of fuel surcharges, per tractor per week(1)$3,601$3,459$3,551$3,414
Average tractors(1) 2,183 2,224 2,175 2,209
Average miles per trip 605 598 610 612
Non-revenue miles percentage(2) 9.0% 10.5% 8.7% 10.6%
Total miles – company-employed drivers (in thousands) 56,140 57,031 110,502 111,926
Total miles – independent contractors (in thousands) 1,057 1,373 2,114 2,314
         
Logistics Segment:        
Total Logistics revenue (in thousands)$39,318$34,561$74,663$77,301
Brokerage:        
Marten Transport        
Revenue (in thousands)$13,112$12,813$24,767$27,282
Loads 8,611 8,602 16,319 18,032
MWL        
Revenue (in thousands) $-- $-- $--$6,676
Loads -- -- -- 3,758
Intermodal:        
Revenue (in thousands)$26,206$21,748$49,896$43,343
Loads 12,032 8,916 22,555 17,506
Average tractors 121 85 110 81
         
At June 30, 2014 and June 30, 2013:        
Total tractors(1) 2,311 2,317    
Average age of company tractors (in years) 1.8 1.9    
Total trailers 4,225 4,111    
Average age of company trailers (in years) 2.5 2.4    
Ratio of trailers to tractors(1) 1.8 1.8    
         
         
   Three Months  Six Months
   Ended June 30,  Ended June 30,
(In thousands) 2014 2013 2014 2013
         
Net cash provided by operating activities$13,187$25,816$40,695$47,810
Net cash used for investing activities 48,149 41,331 69,533 54,416
         
Weighted average shares outstanding:        
Basic 33,369 33,210 33,355 33,196
Diluted 33,696 33,378 33,662 33,344
         
         
(1) Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 35 and 53 tractors as of June 30, 2014, and 2013, respectively.
         
(2) Represents the percentage of miles for which the company is not compensated.

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

Source: Marten Transport, Ltd.


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