Hub Group, Inc. Reports Third Quarter 2009 Earnings

• Press Release
• Source: Hub Group, Inc.
• On 4:01 pm EDT, Wednesday October 21, 2009

DOWNERS GROVE, Ill., Oct. 21 /PRNewswire-FirstCall/ -- Hub Group, Inc. (Nasdaq: HUBG - News) today reported income for the quarter ended September 30, 2009 of $9.8 million. Hub Group's diluted earnings per share was $0.26 for the third quarter of 2009.

Hub Group's revenue of $389 million was down 24% compared to $514 million in the third quarter of 2008. Third quarter intermodal revenue decreased 27% to $270 million. The decrease was attributable to 9% lower volume, 12% lower fuel and a 6% decrease for price and mix. Truck brokerage revenue decreased 27% to $74 million this quarter. Third quarter logistics revenue increased 2% to $45 million.

Hub Group ended the quarter with $123 million in cash.

"We think that the third quarter results were reasonable considering the economic environment. During this downturn, we have focused on reducing our costs and believe that the efficiencies we have realized will continue to improve our competitive position as the economy recovers," said David P. Yeager, Chairman and Chief Executive Officer.

CONFERENCE CALL

Hub will hold a conference call at 5:00 p.m. Eastern Time on Wednesday, October 21, 2009 to discuss its third quarter results and provide an update on 2009 earnings guidance.

Hosting the conference call will be David P. Yeager, Chairman and Chief Executive Officer and Terri A. Pizzuto, Executive Vice-President, Chief Financial Officer and Treasurer.

This call is being webcast and can be accessed through the Investors link on Hub Group's Web site at www.hubgroup.com . Those interested in participating in the question and answer session should follow the telephone dial-in instructions below.

To participate in the conference call by telephone, please call ten minutes early by dialing (888) 679-8040. The conference call participant code is 99408542. Participants may pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PDR38R4AP. Pre-registrants will be issued a pin number to use when dialing into the live call which will provide quick access to the conference, bypassing the operator. The call will be limited to 60 minutes, including questions and answers.

An audio replay will be available through the Investors link on the Company's Web site at http://www.hubgroup.com. This replay will be available for 30 days.

ABOUT HUB GROUP: Hub Group, Inc. is a leading asset light freight transportation management company providing comprehensive intermodal, truck brokerage and logistics services. The Company operates through a network of over 30 offices throughout the United States, Canada and Mexico.

CERTAIN FORWARD-LOOKING STATEMENTS: Statements in this press release that are not historical, including statements about Hub Group's or management's earnings guidance, intentions, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently uncertain and subject to risks. Such statements should be viewed with caution. Actual results or experience could differ materially from the forward-looking statements as a result of many factors. Factors that could cause actual results to differ materially include the factors listed from time to time in Hub Group's SEC reports including, but not limited to, the annual report on Form 10-K for the year ended December 31, 2008 and the reports on Form 10-Q for the periods ended March 31, 2009 and June 30, 2009. Hub Group assumes no liability to update any such forward-looking statements.

                                 HUB GROUP, INC.
              UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                     (in thousands, except per share amounts)


                                      Three Months            Nine Months
                                   Ended September 30,    Ended September 30,
                                   -------------------    -------------------
                                     2009      2008        2009        2008
                                     ----      ----        ----        ----
    Revenue                        $388,781  $514,212  $1,103,089  $1,430,136

    Transportation costs            340,581   451,052     963,958   1,249,635
                                    -------   -------     -------   ---------
      Gross margin                   48,200    63,160     139,131     180,501

    Costs and expenses:
      Salaries and benefits          22,237    24,116      67,514      73,780
      General and administrative      9,122    10,766      28,374      31,393
      Depreciation and amortization     949       995       3,229       2,987
                                        ---       ---       -----       -----
        Total costs and expenses     32,308    35,877      99,117     108,160
                                     ------    ------      ------     -------

    Operating income                 15,892    27,283      40,014      72,341

    Other income (expense):
      Interest expense                  (26)      (31)        (76)        (83)
      Interest and dividend income       29       362         120       1,040
      Other, net                        116      (58)         188          28
                                        ---      ---          ---          --
        Total other income              119       273         232         985

    Income before provision for
     income taxes                    16,011    27,556      40,246      73,326

    Provision for income taxes        6,180    10,626      15,932      28,291
                                      -----    ------      ------      ------

    Net income                       $9,831   $16,930     $24,314     $45,035
                                     ======   =======     =======     =======

    Basic earnings per common share   $0.26     $0.45       $0.65       $1.21
                                      =====     =====       =====       =====

    Diluted earnings per common share $0.26     $0.45       $0.65       $1.20
                                      =====     =====       =====       =====

    Basic weighted average number
     of shares outstanding           37,373    37,209      37,346      37,167
                                     ======    ======      ======      ======
    Diluted weighted average number
     of shares outstanding           37,550    37,541      37,481      37,478
                                     ======    ======      ======      ======

                                 HUB GROUP, INC.
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                       (in thousands, except share amounts)


                                                 September 30,    December 31,
                                                 -------------    ------------
                                                     2009             2008
                                                     ----             ----
                                                  (Unaudited)
    ASSETS
      CURRENT ASSETS:
        Cash and cash equivalents                  $122,808          $ 85,799
        Accounts receivable
          Trade, net                                158,629           145,362
          Other                                       9,606            10,318
        Prepaid taxes                                   132               123
        Deferred taxes                                6,064             5,430
        Prepaid expenses and other current assets     6,155             4,346
                                                      -----             -----
            TOTAL CURRENT ASSETS                    303,394           251,378

      Restricted investments                          8,951             6,118
      Property and equipment, net                    28,686            32,713
      Other intangibles, net                          6,276             6,610
      Goodwill, net                                 232,946           233,110
      Other assets                                    1,648             1,747
                                                      -----             -----
        TOTAL ASSETS                               $581,901          $531,676
                                                   ========          ========

    LIABILITIES AND STOCKHOLDERS' EQUITY
      CURRENT LIABILITIES:
        Accounts payable
          Trade                                    $124,044          $105,064
          Other                                       7,669             6,107
        Accrued expenses
          Payroll                                     9,691             9,988
          Other                                      22,579            26,388
                                                     ------            ------
            TOTAL CURRENT LIABILITIES               163,983           147,547
      Non-current liabilities                        11,073             9,535
      Deferred taxes                                 64,408            59,410
      STOCKHOLDERS' EQUITY:
        Preferred stock, $.01 par value;
         2,000,000 shares authorized; no
         shares issued or outstanding
         in 2009 and 2008                                 -                 -
        Common stock
          Class A: $.01 par value; 97,337,700
           shares authorized and 41,224,792
           shares issued in 2009 and 2008;
           37,225,313 shares outstanding in
           2009 and 36,970,347 outstanding
           in 2008                                      412               412
          Class B:  $.01 par value; 662,300
           shares authorized; 662,296 shares
           issued and outstanding in 2009
           and 2008                                       7                 7
        Additional paid-in capital                  170,725           174,355
        Purchase price in excess of
         predecessor basis, net of tax
         benefit of $10,306                         (15,458)          (15,458)
        Retained earnings                           289,601           265,287
        Accumulated other comprehensive income            2                 -
        Treasury stock; at cost, 3,999,479
         shares in 2009 and 4,254,445 shares
         in 2008                                   (102,852)         (109,419)
                                                   --------          --------
          TOTAL STOCKHOLDERS' EQUITY                342,437           315,184
                                                    -------           -------
            TOTAL LIABILITIES AND STOCKHOLDERS'
             EQUITY                                $581,901          $531,676
                                                   ========          ========

                                  HUB GROUP, INC.
             UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  (in thousands)

                                                     Nine Months Ended
                                                        September 30,
                                                   ----------------------
                                                   2009              2008
                                                   ----              ----

    Cash flows from operating activities:
      Net income                                $24,314           $45,035
      Adjustments to reconcile net income
       to net cash provided by operating
       activities:
        Depreciation and amortization             6,282             5,326
        Deferred taxes                            4,465             7,459
        Compensation expense related to
         share-based compensation plans           3,218             3,332
        (Gain) loss on sale of assets               (21)               77
      Changes in operating assets and
       liabilities:
        Restricted investments                   (2,833)           (1,883)
        Accounts receivable, net                (12,555)          (44,723)
        Prepaid taxes                                (9)                -
        Prepaid expenses and other current
         assets                                  (1,809)           (1,416)
        Other assets                                 99               208
        Accounts payable                         20,542            29,920
        Accrued expenses                         (3,544)           (7,250)
        Non-current liabilities                   1,601              (242)
                                                  -----              ----
        Net cash provided by operating
         activities                              39,750            35,843
                                                 ------            ------

    Cash flows from investing activities:
      Proceeds from sale of equipment                72               857
      Purchases of property and equipment        (2,534)           (7,219)
      Cash used in acquisition of Comtrak, Inc.       -            (5,000)
                                                    ---            ------
          Net cash used in investing activities  (2,462)          (11,362)
                                                 ------           -------

    Cash flows from financing activities:
      Proceeds from stock options exercised         155               401
      Purchase of treasury stock                 (1,096)           (2,215)
      Excess tax benefits from share-based
       compensation                                 660             2,709
                                                    ---             -----
          Net cash (used in) provided by
           financing activities                    (281)              895
                                                   ----               ---

      Effect of exchange rate changes on cash
       and cash equivalents                           2                 -

    Net increase in cash and cash equivalents    37,009            25,376
    Cash and cash equivalents beginning of
     period                                      85,799            38,002
                                               --------           -------
    Cash and cash equivalents end of period    $122,808           $63,378
                                               ========           =======

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