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Universal Logistics Holdings Reports Fourth Quarter 2020 Financial Results; Announces Change in Reportable Segments; Declares Dividend; Announces Participation in Investor Conference

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- Fourth Quarter 2020 Operating Revenues: $386.0 million, 2.7% increase

- Fourth Quarter 2020 Operating Income: $23.5 million, 6.1% operating margin

- Fourth Quarter 2020 Earnings Per Share: $0.60 per share

- Declares Quarterly Dividend: $0.105 per share

WARREN, Mich., Feb. 4, 2021 /PRNewswire/ -- Universal Logistics Holdings, Inc. (NASDAQ: ULH), a leading asset-light provider of customized transportation and logistics solutions, today reported consolidated fourth quarter 2020 net income of $16.2 million, or $0.60 per basic and diluted share, on total operating revenues of $386.0 million. This compares to net income of $8.7 million, or $0.32 per basic and diluted share, during fourth quarter 2019 on total operating revenues of $375.9 million. Included in fourth quarter 2019 operating income was a pre-tax charge of $2.9 million, or $0.08 per share, for a previously disclosed legal matter. Fourth quarter 2020 results include a $1.5 million pre-tax holding gain, or $0.04 per share, on marketable securities due to changes in fair value recognized in income compared to $0.5 million, or $0.01 per share, in the fourth quarter of 2019.

Universal Logistics Holdings logo (PRNewsfoto/Universal Logistics Holdings)
Universal Logistics Holdings logo (PRNewsfoto/Universal Logistics Holdings)

In the fourth quarter 2020, Universal reported operating income of $23.5 million compared to operating income of $15.5 million in the fourth quarter one year earlier. As a percentage of operating revenue, operating margin for the fourth quarter 2020 was 6.1% compared to 4.1% during the same period last year. EBITDA, a non-GAAP measure, increased by $6.4 million during the fourth quarter 2020 to $44.2 million, compared to $37.7 million one year earlier. As a percentage of operating revenue, EBITDA margin for the fourth quarter 2020 was 11.4% compared to 10.0% during the same period last year.

"I am excited to announce that the fourth quarter of 2020 was Universal's highest fourth quarter earnings on record," stated Tim Phillips, Universal's Chief Executive Officer. "In the face of so many challenges, I would like to express my sincerest gratitude to the thousands of employees and contractors who have worked so hard to make this year a success. As we exit the year on a high note, we have a significant amount of opportunity in front of us. I remain bullish on the strength of North American automotive and Class 8 truck production, as well as our potential to capitalize on import volumes which are forecast to increase 2021. We remain razor focused on execution and achieving operational excellence in each of our service lines. This year has proven the agility of our business model and the strength of our people, and I am confident in the prospect of an even more successful year in 2021."

Operating revenues from truckload services in the fourth quarter decreased $8.7 million to $49.8 million, compared to $58.4 million for the same period last year. Included in truckload revenues for the recently completed quarter were $3.7 million in separately identified fuel surcharges compared to $6.1 million during the same period last year. The decrease in truckload services also reflects a decrease in the number of loads hauled, which was partially offset by an increase in average operating revenue per load, excluding fuel surcharges. During the quarter ended December 31, 2020, Universal moved 47,717 loads compared to 54,804 during the same period last year, while its average operating revenue per load, excluding fuel surcharges, increased by 3.3%.

Revenues for the fourth quarter 2020 from brokerage services increased $11.9 million, or 13.9%, to $97.1 million compared to $85.3 million one year earlier. The increase is primarily due to a 19.7% increase in average operating revenue per load, which was partially offset by a 7.0% decrease in the number of brokerage loads moved. During the fourth quarter of 2020, Universal brokered 51,888 loads, compared to 55,812 loads during the same period last year.

Intermodal services revenues decreased $6.4 million to $105.9 million in the fourth quarter 2020, compared to $112.3 million for the same period last year. Included in intermodal revenues for the recently completed quarter were $8.9 million in separately identified fuel surcharges compared to $13.5 million during the same period last year. Fourth quarter 2020 intermodal revenues also included $12.5 million of demurrage charges, compared to $0.6 million one year earlier. Intermodal services also reflects a decrease in the number of loads hauled and a decrease in the average operating revenue per load, excluding fuel surcharges. During the quarter ended December 31, 2020, Universal moved 182,582 intermodal loads, compared to 186,646 loads during the same period last year, while its average operating revenue per load, excluding fuel surcharges, fell by 17.2%.

Fourth quarter 2020 operating revenues from dedicated services increased 16.6% to $38.5 million compared to $33.0 million one year earlier. Dedicated services revenues included $3.5 million in separately identified fuel surcharges in each of the fourth quarters 2020 and 2019. The increase in revenue was attributable to continued strength in North American automotive production compared to the fourth quarter of last year which included a UAW labor strike against General Motors early in the quarter. During the fourth quarter of 2020, Universal moved 135,821 dedicated loads, compared to 119,745 loads during the same period last year, an increase of 13.4%.

Overall, revenues from value-added services increased 8.9% during the fourth quarter 2020 to $94.6 million. This compares to $86.9 million one year earlier. The increase was primarily driven by strong demand in operations supporting passenger vehicle programs during the fourth quarter 2020, compared to the prior year which was adversely impacted by the UAW labor strike early in the quarter. The increase was partially offset by our value-added operations supporting heavy-truck production where revenues fell $3.3 million in the fourth quarter 2020 compared to the same period last year.

The Company also announced a realignment of its current operating segments into four reportable segments. Consistent with Universal's strategic initiatives to grow both organically and through acquisitions, these segment changes reflect how the Company evaluates the operating performance of our businesses, and has grown and diversified over the last several years. The new reportable operating segments are contract logistics, intermodal, trucking and company-managed brokerage.

In the contract logistics segment, which includes value-added and dedicated services, continued strength in North American automotive manufacturing led to improved performance during the period. For the fourth quarter 2020, income from operations in the contract logistics segment was $12.0 million on total operating revenues of $133.2 million. This compares to $7.2 million of income from operations in the fourth quarter 2019, which included the then-existing labor strike by the UAW against General Motors. As a percentage of revenue, operating margin for the fourth quarter 2020 in the contract segment was 9.0% compared to 6.0% during the same period last year.

During the fourth quarter 2020, the intermodal segment reported operating income of $7.8 million on total operating revenues of $105.9 million. As a percentage of revenue, operating margin for the fourth quarter 2020 in the intermodal segment was 7.3% compared to 12.0% during the same period last year. Continued rate pressure, significant demurrage spend, and a slower-than-anticipated rate of trucks returning to work adversely impacted the intermodal segment during the quarter.

The trucking segment, which includes agent-based and company-managed trucking operations, reported operating income of $3.5 million on total operating revenues of $80.9 million during the fourth quarter 2020. This compares to operating revenues of $90.0 million and an operating loss of $2.9 million in the same period last year, which included the settlement of a previously disclosed legal matter.

During the fourth quarter 2020, the company-managed brokerage segment reported an operating profit of $0.2 million on total operating revenues of $65.8 million during the fourth quarter of 2020. Although underperforming compared to the same period last year, reporting an operating profit in the fourth quarter 2020 represents a sequential improvement as the Company continues to rationalize both lanes and customers.

As of December 31, 2020, Universal held cash and cash equivalents totaling $8.8 million, and $6.5 million in marketable securities. Outstanding debt at the end of the fourth quarter 2020 was $461.7 million and capital expenditures totaled $17.9 million.

Universal Logistics Holdings, Inc. announced today that its Board of Directors has declared a cash dividend of $0.105 per share of common stock. The dividend is payable to shareholders of record at the close of business on March 1, 2021 and is expected to be paid on April 5, 2021.

Universal also announced that Tim Phillips, Universal's Chief Executive Officer, and Jude Beres, Chief Financial Officer, will participate in the Stifel 2021 Virtual Transportation & Logistics Conference. Universal's presentation begins at 9:20 AM ET on Tuesday, February 9, 2021. Management will present on Universal's unique capabilities, reflect on current market and operating trends, and outline plans and expectations for future growth.

The conference will be broadcast live via webcast at http://www.universallogistics.com. Click on "Investor Relations" and then click the webcast link. A webcast replay will be available for 30 days following each event.

Universal calculates and reports selected financial metrics not only for purposes of our lending arrangements but also in an effort to isolate and exclude the impact of non-operating expenses related to our corporate development activities. These statistics are described in more detail below in the section captioned "Non-GAAP Financial Measures."

Conference call:

We invite investors and analysts to our quarterly earnings conference call.

Quarterly Earnings Conference Call Dial-in Details:

Time: 10:00 a.m. Eastern Time
Date: Friday, February 5, 2021
Call Toll Free: (866) 622-0924
International Dial-in: +1 (660) 422-4956
Conference ID: 5249878

A replay of the conference call will be available beginning two hours after the call through February 12, 2021, by calling (855) 859-2056 (toll free) or +1 (404) 537-3406 (toll) and using conference ID 5249878. The call will also be available on investors.universallogistics.com.

About Universal:

Universal Logistics Holdings, Inc. is a leading asset-light provider of customized transportation and logistics solutions throughout the United States, and in Mexico, Canada and Colombia. We provide our customers with supply chain solutions that can be scaled to meet their changing demands and volumes. We offer our customers a broad array of services across their entire supply chain, including truckload, brokerage, intermodal, dedicated, and value-added services.

Forward Looking Statements

Some of the statements contained in this press release might be considered forward-looking statements. These statements identify prospective information. Forward-looking statements can be identified by words such as: "expect," "anticipate," "intend," "plan," "goal," "prospect," "seek," "believe," "targets," "project," "estimate," "future," "likely," "may," "should" and similar references to future periods. Forward-looking statements are based on information available at the time and/or management's good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements. These forward-looking statements are subject to a number of factors that may cause actual results to differ materially from the expectations described. Additional information about the factors that may adversely affect these forward-looking statements is contained in the Company's reports and filings with the Securities and Exchange Commission. The Company assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Condensed Consolidated Statements of Income

(In thousands, except per share data)




Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2020



2019



2020



2019


Operating revenues:

















Truckload services


$

49,786



$

58,441



$

201,419



$

251,574


Brokerage services



97,116




85,260




336,365




354,940


Intermodal services



105,887




112,256




393,633




390,299


Dedicated services



38,524




33,046




127,510




138,664


Value-added services



94,640




86,928




332,156




376,521


Total operating revenues



385,953




375,931




1,391,083




1,511,998



















Operating expenses:

















Purchased transportation and equipment rent



187,469




183,495




674,143




723,079


Direct personnel and related benefits



93,756




89,480




337,618




368,243


Operating supplies and expenses



32,398




28,796




111,056




120,767


Commission expense



7,711




7,519




26,661




31,204


Occupancy expense



8,097




9,122




34,586




36,645


General and administrative



9,177




14,187




33,267




44,497


Insurance and claims



4,597




6,203




19,252




47,418


Depreciation and amortization



19,199




21,626




74,141




74,765


Total operating expenses



362,404




360,428




1,310,724




1,446,618


Income from operations



23,549




15,503




80,359




65,380


Interest expense, net



(3,428)




(4,466)




(14,579)




(17,012)


Other non-operating income (loss)



1,418




606




(1,870)




1,818


Income before income taxes



21,539




11,643




63,910




50,186


Provision for income taxes



5,316




2,906




15,778




12,600


Net income


$

16,223



$

8,737



$

48,132



$

37,586



















Earnings per common share:

















Basic


$

0.60



$

0.32



$

1.78



$

1.34


Diluted


$

0.60



$

0.32



$

1.78



$

1.34



















Weighted average number of common shares
outstanding:

















Basic



26,917




27,282




26,997




28,069


Diluted



26,926




27,283




27,000




28,070



















Dividends declared per common share:


$

0.105



$

0.105



$

0.210



$

0.420


UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Condensed Consolidated Balance Sheets

(In thousands)




December 31,

2020



December 31,

2019


Assets









Cash and cash equivalents


$

8,763



$

7,726


Marketable securities



6,534




9,369


Accounts receivable - net



259,154




210,534


Other current assets



47,073




44,214


Total current assets



321,524




271,843


Property and equipment - net



364,795




339,823


Other long-term assets - net



376,730




383,769


Total assets


$

1,063,049



$

995,435











Liabilities and shareholders' equity









Current liabilities, excluding current maturities of debt


$

213,094



$

190,943


Debt - net



460,120




457,612


Other long-term liabilities



150,262




141,663


Total liabilities



823,476




790,218


Total shareholders' equity



239,573




205,217


Total liabilities and shareholders' equity


$

1,063,049



$

995,435


UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Summary of Operating Data




Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2020



2019



2020



2019


Truckload Services:

















Number of loads



47,717




54,804




187,561




233,829


Average operating revenue per load,
excluding fuel surcharges


$

1,023



$

990



$

1,019



$

965


Average operating revenue per mile,
excluding fuel surcharges


$

3.67



$

3.18



$

3.52



$

3.27


Average length of haul



279




311




289




295


Average number of tractors



1,276




1,472




1,324




1,524



















Brokerage Services:

















Number of loads (a)



51,888




55,812




215,656




228,203


Average operating revenue per load (a)


$

1,797



$

1,501



$

1,516



$

1,499


Average length of haul (a)



612




669




613




653



















Intermodal Services:

















Number of loads



182,582




186,646




719,947




671,184


Average operating revenue per load,
excluding fuel surcharges


$

442



$

534



$

451



$

507


Average number of tractors



1,951




2,294




2,168




1,916


Number of depots



12




15




12




15



















Dedicated Services:

















Number of loads (b)



135,821




119,745




493,733




553,682



















Value-added Services

















Average number of direct employees



3,507




3,702




3,444




3,636


Average number of full-time equivalents



1,387




1,177




1,233




1,487


Number of active programs



58




55




58




55





















(a)

Excludes operating data from freight forwarding division in order to improve the relevance of the statistical data related to our brokerage services and improve the comparability to our peer companies.

(b)

Includes shuttle moves.


UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Summary of Operating Data - Continued

(Dollars in thousands)




Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2020



2019



2020



2019


Operating Revenues by Segment:

















Contract logistics


$

133,164



$

119,974



$

459,666



$

515,185


Intermodal



105,887




112,256




393,633




390,299


Trucking



80,863




89,956




318,385




389,629


Company-managed brokerage



65,822




53,526




218,123




215,750


Other



217




219




1,276




1,135


Total


$

385,953



$

375,931



$

1,391,083



$

1,511,998



















Income from Operations by Segment:

















Contract logistics


$

11,956



$

7,202



$

35,967



$

48,376


Intermodal



7,770




13,421




30,353




39,196


Trucking



3,545




(2,890)




16,413




(21,485)


Company-managed brokerage



227




630




(2,681)




1,833


Other



51




(2,860)




307




(2,540)


Total


$

23,549



$

15,503



$

80,359



$

65,380


Non-GAAP Financial Measure

In addition to providing consolidated financial statements based on generally accepted accounting principles in the United States of America (GAAP), we are providing additional financial measures that are not required by or prepared in accordance with GAAP (non-GAAP). We present EBITDA and EBITDA margin, each a non-GAAP measure, as supplemental measures of our performance. We define EBITDA as net income plus (i) interest expense, net, (ii) income taxes, (iii) depreciation, and (iv) amortization. We define EBITDA margin as EBITDA as a percentage of total operating revenues. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis.

In accordance with the requirements of Regulation G issued by the Securities and Exchange Commission, we are presenting the most directly comparable GAAP financial measure and reconciling the non-GAAP financial measure to the comparable GAAP measure. Set forth below is a reconciliation of net income, the most comparable GAAP measure, to EBITDA for each of the periods indicated:



Thirteen Weeks Ended



Year Ended




December 31,



December 31,




2020



2019



2020



2019




( in thousands)



( in thousands)


EBITDA

















Net income


$

16,223



$

8,737



$

48,132



$

37,586


Income tax expense



5,316




2,906




15,778




12,600


Interest expense, net



3,428




4,466




14,579




17,012


Depreciation



15,413




18,315




58,934




59,023


Amortization



3,786




3,311




15,207




15,742


EBITDA


$

44,166



$

37,735



$

152,630



$

141,963



















EBITDA margin (a)



11.4

%



10.0

%



11.0

%



9.4

%



(a)

EBITDA margin is computed by dividing EBITDA by total operating revenues for each of the periods indicated.

We present EBITDA and EBITDA margin because we believe they assist investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

EBITDA has limitations as an analytical tool. Some of these limitations are:

  • EBITDA does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;

  • EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

  • EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts;

  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements; and

  • Other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, EBITDA and EBITDA margin should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and only supplementally on EBITDA and EBITDA margin.

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SOURCE Universal Logistics Holdings, Inc.