Landstar System Inc (LSTR) Reports Q3 2023 Earnings
Landstar System Inc (NASDAQ:LSTR) reported Q3 2023 revenue of $1.289 billion and earnings per share (EPS) of $1.71.
The company's gross profit for Q3 2023 was $128.1 million, with a variable contribution of $187.4 million.
Truck transportation revenue for Q3 2023 was $1,173.8 million, accounting for 91% of total revenue.
Landstar's Board of Directors declared a quarterly dividend of $0.33 per share, payable on December 1, 2023.
Landstar System Inc (NASDAQ:LSTR) released its Q3 2023 earnings report on October 25, 2023. The company reported a basic and diluted EPS of $1.71 on revenue of $1.289 billion. This is a decrease from Q3 2022 when the company reported an EPS of $2.76 on revenue of $1.816 billion.
Financial Performance
The company's gross profit for the quarter was $128.1 million, with a variable contribution (defined as revenue less the cost of purchased transportation and commissions to agents) of $187.4 million. This is a decrease from Q3 2022 when the gross profit was $185.7 million and the variable contribution was $245.7 million.
Landstar's return on average shareholders' equity was 32%, and return on invested capital was 29%. The company is currently authorized to purchase up to 2,910,339 shares of its common stock under its previously announced share purchase programs.
Revenue Breakdown
Truck transportation revenue hauled by independent business capacity owners (BCOs) and truck brokerage carriers in Q3 2023 was $1,173.8 million, or 91% of revenue. This is a decrease from $1,598.8 million, or 88% of revenue, in Q3 2022. Revenue from other truck transportation was $102.0 million, compared to $195.3 million in Q3 2022. Revenue hauled by rail, air, and ocean cargo carriers was $88.9 million, or 7% of revenue, compared to $191.9 million, or 11% of revenue, in Q3 2022.
Company Commentary
Landstar President and CEO Jim Gattoni commented on the company's performance, stating
The soft freight market fundamentals experienced during the 2023 second quarter continued throughout the 2023 third quarter and made for challenging comparisons against our record 2022 third quarter performance."
He attributed the lackluster demand to continued weakness in the U.S. manufacturing sector and the ongoing impact of an inflation-challenged consumer goods sector.
Despite the challenges, Gattoni highlighted the company's strong balance sheet, with cash and short-term investments of approximately $497 million as of September 30, 2023. Cash flow from operations was $304 million through the first three quarters of fiscal year 2023.
Future Outlook
Looking ahead, Gattoni anticipates revenue for Q4 2023 to be in the range of $1.225 billion to $1.275 billion, with EPS in the range of $1.60 to $1.70. The company's Board of Directors has declared a quarterly dividend of $0.33 per share, payable on December 1, 2023, to stockholders of record as of the close of business on November 7, 2023.
Explore the complete 8-K earnings release (here) from Landstar System Inc for further details.
This article first appeared on GuruFocus.
