Old Dominion Freight Line : Announces 42.1% Growth in First-Quarter Earnings To $0.54 Per Diluted Share
04/26/2012| 07:10am US/Eastern
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Revenue Grows 17.6% to New Quarterly Record
Old Dominion Freight Line, Inc. (NASDAQ: ODFL) today announced financial
results for the first quarter ended March 31, 2012. Revenue increased
17.6% to $497.1 million from $422.7 million for the first quarter of
2011. Net income was $31.1 million for the first quarter of 2012, which
was an increase of 44.1% from $21.6 million for the first quarter of
2011. Earnings per diluted share increased 42.1% to $0.54 from $0.38 for
the first quarter last year, while the Company's operating ratio
improved to 89.1% from 91.0%.
"Old Dominion produced strong profitable growth for the first quarter of
2012, which resulted in another record quarter for the Company,"
commented David S. Congdon, President and Chief Executive Officer of Old
Dominion. "We are pleased with our first-quarter performance, which
included the highest revenue for any quarter in our 78-year history and
our best operating ratio ever during a first quarter. We are also
encouraged by our financial results and operating trends, which improved
against tough comparable performance metrics from the first quarter last
year.
"Our first-quarter revenue reflected a 10.7% increase in tonnage and a
5.5% increase in revenue per hundredweight as compared with the first
quarter of 2011. The increase in tonnage is the result of a 9.5%
increase in shipments and a 1.0% increase in weight per shipment. While
the domestic economy appears to be slightly improving, we attribute our
quarter-over-quarter growth in revenue and tonnage primarily to gains in
market share. Our ongoing ability to win market share is based on our
commitment to providing superior service to our customers at a fair and
equitable price. This balance between service and price provides value
to our customers and also allows us to further invest in OD.
"The movement of additional tonnage through our existing service center
network provided further operating leverage, which drove improvements in
most of our productivity metrics. These factors, combined with the
improvement in our revenue per hundredweight, resulted in the 190 basis
point reduction in our operating ratio to 89.1%. Our first-quarter
performance is an excellent start for the year and provides momentum for
continued profitable growth in 2012."
Capital expenditures for the first quarter were $89.4 million and
included the relocation and expansion of two service centers. For 2012,
we continue to expect capital expenditures to range between $300 million
and $350 million. This estimate includes $90 million to $120 million for
real estate purchases and expansion projects at existing facilities,
subject to the availability of suitable real estate and the timing of
construction projects, $195 million to $210 million for the purchase of
tractors, trailers and other equipment, and $15 million to $20 million
for investments in technology.
"Our financial position has continued to strengthen despite the
significant amount of capital expenditures during the first quarter of
2012. We plan to fund the remainder of our expected 2012 capital
expenditures primarily with cash flow from operations and the $54.2
million of cash on hand at the end of the first quarter. As a result of
our ability to utilize these sources of liquidity to fund our capital
expenditures, our ratio of total debt to capitalization improved to
22.5% at the end of the first quarter of 2012, compared to 23.9% at the
end of 2011 and 28.1% at the end of the first quarter of 2011."
Mr. Congdon concluded, "Old Dominion's operating and financial
performance during the first quarter was one of our best ever. We
believe this success provides clear evidence that our focus on providing
value to shippers with superior on-time and claims-free service
continues to resonate in the LTL market and win market share. Our
financial strength has also allowed us to invest in our employees,
technology, value-added services and operating capacity, which we expect
will enhance our ability to drive near-term and long-term growth in
market share, earnings and shareholder value."
Old Dominion will hold a conference call to discuss this release today
at 10:00 a.m. Eastern Daylight Time. Investors will have the opportunity
to listen to the conference call live over the Internet by going to www.odfl.com.
Please log on at least 15 minutes early to register, download and
install any necessary audio software. For those who cannot listen to the
live broadcast, a replay will be available at this website shortly after
the call through May 10, 2012. A telephonic replay will also be
available through May 10, 2012 at (719) 457-0820, Confirmation Number
7324822.
Forward-looking statements in this news release are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Investors are cautioned that such forward-looking statements
involve risks and uncertainties that could cause actual events and
results to be materially different from those expressed or implied
herein, including, but not limited to, the following: (1) the
competitive environment with respect to industry capacity and pricing,
including the use of fuel surcharges, such that our total overall
pricing is sufficient to cover our operating expenses; (2) our ability
to collect fuel surcharges and the effectiveness of those fuel
surcharges in mitigating the impact of fluctuating prices for fuel and
other petroleum-based products; (3) the negative impact of any
unionization, or the passage of legislation that could facilitate
unionization, of our employees; (4) the challenges associated with
executing our growth strategy, including the inability to successfully
consummate and integrate acquisitions, if any; (5) changes in our goals
and strategies, which are subject to change at any time at our
discretion; (6) various economic factors such as economic recessions and
downturns in customers' business cycles and shipping requirements; (7)
increases in driver compensation or difficulties attracting and
retaining qualified drivers to meet freight demand; (8) our exposure to
claims related to cargo loss and damage, property damage, personal
injury, workers' compensation, long-term disability and group health,
including increased premiums, adverse loss development, increased
self-insured retention levels, and claims in excess of coverage levels;
(9) the availability and cost of capital for our significant ongoing
cash requirements; (10) the availability and cost of replacement parts
and new equipment, particularly in light of regulatory changes and
supply constraints impacting the cost of these assets; (11) decreases in
demand for, and the value of, used equipment; (12) the availability and
cost of diesel fuel; (13) the costs and potential liabilities related to
compliance with, or violations of, existing or future governmental laws
and regulations, including environmental laws, engine emissions
standards, hours-of-service for our drivers, and new safety standards
for drivers and equipment; (14) the costs and potential adverse impact
associated with the continued implementation of the safety monitoring
system of the Federal Motor Carrier Safety Administration; (15) seasonal
trends in the industry, including the possibility of harsh weather
conditions; (16) our dependence on key employees; (17) the concentration
of our stock ownership with the Congdon family; (18) the costs and
potential adverse impact associated with potential future changes in
accounting standards or practices; (19) the impact caused by potential
disruptions to our information technology systems; (20) dilution to
existing shareholders caused by any issuance of additional equity; and
(21) other risks and uncertainties indicated from time to time in our
filings with the Securities and Exchange Commission. Our forward-looking
statements are based upon our beliefs and assumptions using information
available at the time the statements are made. We caution the reader not
to place undue reliance on our forward-looking statements (i) as these
statements are neither a prediction nor a guarantee of future events or
circumstances and (ii) the assumptions, beliefs, expectations and
projections about future events may differ materially from actual
results. We undertake no obligation to publicly update any
forward-looking statement to reflect developments occurring after the
statement is made, except as otherwise required by law.
Old Dominion Freight Line, Inc. is a leading, less-than-truckload
("LTL"), union-free motor carrier providing regional, inter-regional and
national LTL service and value-added logistics services. In addition to
its core LTL services, the Company offers its customers a broad range of
logistics services including ground and air expedited transportation,
supply chain consulting, transportation management, truckload brokerage,
container delivery, warehousing and consumer household moving services.
Through marketing and carrier relationships, the Company also offers
door-to-door international freight services to and from all of North
America, Central America, South America and the Far East.
OLD DOMINION FREIGHT LINE, INC.
Financial Highlights
(Dollars in thousands, except per share amounts)
Three Months Ended
March 31,
%
2012
2011
Chg.
Revenue from operations
$
497,140
$
422,679
17.6
%
Operating income
$
54,218
$
37,921
43.0
%
Operating ratio
89.1
%
91.0
%
Net income
$
31,095
$
21,573
44.1
%
Basic and diluted earnings per share
$
0.54
$
0.38
42.1
%
Basic and diluted weighted average shares outstanding
57,443
56,256
2.1
%
OLD DOMINION FREIGHT LINE, INC.
Statements of Operations
(In thousands, except per share amounts)
First Quarter
2012
2011
% Chg.
Revenue
$
497,140
100.0
%
$
422,679
100.0
%
17.6
%
Operating expenses:
Salaries, wages & benefits
257,989
51.9
%
221,498
52.4
%
16.5
%
Operating supplies & expenses
94,216
19.0
%
82,633
19.5
%
14.0
%
General supplies & expenses
14,152
2.8
%
11,566
2.7
%
22.4
%
Operating taxes & licenses
16,356
3.3
%
15,529
3.7
%
5.3
%
Insurance & claims
7,683
1.5
%
7,192
1.7
%
6.8
%
Communications & utilities
4,854
1.0
%
4,550
1.1
%
6.7
%
Depreciation & amortization
25,544
5.1
%
21,121
5.0
%
20.9
%
Purchased transportation
16,231
3.3
%
14,290
3.4
%
13.6
%
Building and office equipment rents
3,268
0.7
%
3,387
0.8
%
(3.5
)%
Miscellaneous expenses, net
2,629
0.5
%
2,992
0.7
%
(12.1
)%
Total operating expenses
442,922
89.1
%
384,758
91.0
%
15.1
%
Operating income
54,218
10.9
%
37,921
9.0
%
43.0
%
Other deductions:
Interest expense, net
3,167
0.6
%
3,857
0.9
%
(17.9
)%
Other expense, net
(346
)
--
%
(1,418
)
(0.3
)%
(75.6
)%
Income before income taxes
51,397
10.3
%
35,482
8.4
%
44.9
%
Provision for income taxes
20,302
4.0
%
13,909
3.3
%
46.0
%
Net income
$
31,095
6.3
%
$
21,573
5.1
%
44.1
%
Earnings per share:
Basic and Diluted
$
0.54
$
0.38
42.1
%
Weighted average outstanding shares:
Basic and Diluted
57,443
56,256
2.1
%
OLD DOMINION FREIGHT LINE, INC.
Operating Statistics
First Quarter
2012
2011
% Chg.
Operating ratio
89.1
%
91.0
%
(2.1
)%
Intercity miles (1)
100,096
89,327
12.1
%
Total tons (1)
1,659
1,499
10.7
%
Total shipments (1)
1,873
1,710
9.5
%
Revenue per intercity mile
$
4.97
$
4.73
5.1
%
Revenue per hundredweight (2)
$
15.05
$
14.27
5.5
%
Revenue per hundredweight excluding fuel surcharges (2)
$
12.53
$
12.09
3.6
%
Revenue per shipment (2)
$
266.58
$
250.21
6.5
%
Revenue per shipment excluding fuel surcharges (2)
$
221.86
$
211.92
4.7
%
Weight per shipment (lbs.)
1,771
1,753
1.0
%
Average length of haul (miles)
945
961
(1.7
)%
(1) -
In thousands
(2) -
For statistical purposes only, revenue does not include adjustments
for undelivered freight required for financial statement purposes in
accordance with the Company's revenue recognition policy.
OLD DOMINION FREIGHT LINE, INC.
Balance Sheets
(In thousands)
March 31,
2012
December 31,
2011
Cash and cash equivalents
$
54,219
$
75,850
Other current assets
273,681
256,002
Total current assets
327,900
331,852
Net property and equipment
1,190,137
1,126,950
Other assets
56,155
54,272
Total assets
$
1,574,192
$
1,513,074
Current maturities of long-term debt
$
39,086
$
39,354
Other current liabilities
212,182
165,456
Total current liabilities
251,268
204,810
Long-term debt
219,117
229,831
Other non-current liabilities
216,193
221,914
Total liabilities
686,578
656,555
Equity
887,614
856,519
Total liabilities & equity
$
1,574,192
$
1,513,074
Note: The financial and operating statistics in this release are
unaudited.
Old Dominion Freight Line, Inc. J. Wes Frye, 336-822-5305 Senior
Vice President, Finance and Chief Financial Officer
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