Marten Transport Announces Second Quarter Results

MONDOVI, Wis., July 18, 2022 (GLOBE NEWSWIRE) -- Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported a 47.8% improvement in net income to $31.7 million, or 39 cents per diluted share, for the second quarter ended June 30, 2022, from $21.4 million, or 26 cents per diluted share, for the second quarter of 2021. The 2022 second-quarter earnings also improved 15.0% sequentially from 2022 first-quarter net income of $27.5 million, or 33 cents per diluted share. For the first six months of 2022, net income improved 50.1% to $59.2 million, or 72 cents per diluted share, from $39.4 million, or 47 cents per diluted share, for the first six months of 2021.

Operating Results Comparison

Percentage

Percentage

Percentage

Percentage

Percentage

Increase

Increase

Increase

Increase

Increase

Three Months

Three Months

Year

Year

Year

Ended

Ended

Ended

Ended

Ended

June 30,

March 31,

December 31,

December 31,

December 31,

2022 vs. 2021

2022 vs. 2021

2021 vs. 2020

2020 vs. 2019

2019 vs. 2018

Operating revenue

41.8%

28.8%

11.4%

3.7%

7.1%

Operating revenue, net of fuel surcharges

32.1%

23.8%

8.3%

6.8%

8.6%

Operating income

43.5%

49.4%

19.8%

21.9%

8.7%

Net income

47.8%

52.9%

22.9%

13.8%

11.0%

Operating revenue for the second quarter of 2022 was the highest amount for any quarter in Marten’s 77-year history. Operating revenue improved 41.8% to $329.6 million for the second quarter of 2022 from $232.4 million for the second quarter of 2021 - and improved 14.7% from $287.3 million for the 2022 first quarter. Excluding fuel surcharges, operating revenue improved 32.1% to $269.1 million for the 2022 quarter from $203.7 million for the 2021 quarter - and improved 9.7% from $245.3 million for the 2022 first quarter. Fuel surcharge revenue increased to $60.4 million for the 2022 quarter from $28.8 million for the 2021 quarter due to significantly higher fuel prices.

Operating revenue improved 35.4% to $616.8 million for the first six months of 2022 from $455.5 million for the first six months of 2021. Excluding fuel surcharges, operating revenue improved 28.0% to $514.4 million for the first six months of 2022 from $401.8 million for the first six months of 2021. Fuel surcharge revenue increased to $102.4 million for the first six months of 2022 from $53.7 million for the first six months of 2021.

Operating income for the second quarter of 2022 was also the highest amount for any quarter in Marten’s history. Operating income improved 43.5% to $40.9 million for the second quarter of 2022 from $28.5 million for the second quarter of 2021 - and improved 14.2% from $35.9 million for the 2022 first quarter, which was up 16.9% from $30.7 million for the 2021 fourth quarter.

Operating income improved 46.2% to $76.8 million for the first six months of 2022 from $52.5 million for the first six months of 2021.

Operating expenses as a percentage of operating revenue improved to 87.6% for the second quarter of 2022 from 87.7% for the second quarter of 2021. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 84.8% for the 2022 quarter, the best ratio for any quarter since Marten became a public company in 1986, from 86.0% for the 2021 quarter.

Operating expenses as a percentage of operating revenue improved to 87.6% for the first six months of 2022 from 88.5% for the first six months of 2021. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, improved to 85.1% from 86.9%.

Executive Chairman Randolph L. Marten stated, “Consistent. Strong. Profitable. Organic Growth. Marten’s bright, driven people just earned our highest operating revenue and operating income for any quarter in our history, along with our best operating ratio, net of fuel surcharges, for any quarter since we became a public company in 1986 – achieving all three marks for the third time in our last five quarters.”

“The unrelenting national shortage of qualified drivers is a long-term double-edged sword for our industry, simultaneously tightening the freight market while limiting fleet size. Our ability to capitalize on the high level of demand we continue to see and apply our culture of continuous operating enhancements within our unique business model has largely contributed to our performance improvements. Our approach to overcoming the driver shortage is a heightened emphasis on structurally improving our drivers’ jobs and work-life balance by collaborating with our customers, while also increasing our driver compensation. The results - we continue to build on our success in expanding the capacity we provide as we began this year’s third quarter with 123 more of the industry’s top drivers than we employed at the beginning of the second quarter. We have now increased our number of drivers by 422, or 15.4%, since June 30, 2021.”

“Also, reflecting our confidence in Marten’s financial strength and commitment to enhancing stockholder value, we repurchased and retired 963,000 shares of our common stock for $16.8 million in the second quarter of 2022, in addition to the 1.3 million shares of our common stock for $25.0 million repurchased in the first quarter.”

	Operating Results Since the Pandemic Began – Percentage Increase Over Same Quarter of Prior Year
				Q2 2022			Q1 2022			Q4 2021			Q3 2021			Q2 2021			Q1 2021			Q4 2020			Q3 2020			Q2 2020
	Operating revenue			41.8%			28.8%			17.4%			16.3%			9.4%			2.0%			4.7%			0.5%			0.1%
	Operating revenue, net of fuel surcharges			32.1%			23.8%			12.5%			12.8%			5.0%			2.5%			8.8%			3.8%			4.7%
	Operating income			43.5%			49.4%			20.0%			16.8%			12.9%			33.1%			36.0%			21.8%			26.6%
	Net income			47.8%			52.9%			26.1%			17.9%			18.1%			31.3%			24.5%			8.8%			19.4%

Current Investor Presentation

Marten Transport, with headquarters in Mondovi, Wis., is a multifaceted business offering a network of refrigerated and dry truck-based transportation capabilities across the Company’s five distinct business platforms - Truckload, Dedicated, Intermodal, Brokerage and MRTN de Mexico. Marten is one of the leading temperature-sensitive truckload carriers in the United States, specializing in transporting and distributing food, beverages and other consumer packaged goods that require a temperature-controlled or insulated environment. The Company offers service in the United States, Mexico and Canada, concentrating on expedited movements for high-volume customers. Marten’s common stock is traded on the Nasdaq Global Select Market under the symbol MRTN.

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 include a discussion of Marten’s prospects for future growth and 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 Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise.

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

MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS

		June 30,				December 31,
(In thousands, except share information)		2022				2021
			(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	68,374			$	56,995
Receivables:
Trade, net			138,391				99,003
Other			3,681				6,971
Prepaid expenses and other			27,437				23,980
Total current assets			237,883				186,949
Property and equipment:
Revenue equipment, buildings and land, office equipment and other			992,400				956,476
Accumulated depreciation			(310,645	)			(274,199	)
Net property and equipment			681,755				682,277
Other noncurrent assets			1,483				1,464
Total assets		$	921,121			$	870,690
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	48,463			$	20,150
Insurance and claims accruals			45,689				42,014
Accrued and other current liabilities			36,565				31,395
Total current liabilities			130,717				93,559
Deferred income taxes			129,972				125,163
Noncurrent operating lease liabilities			275				291
Total liabilities			260,964				219,013
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; 192,000,000 shares authorized; 81,014,564 shares at June 30, 2022, and 83,034,404 shares at December 31, 2021, issued and outstanding			810				830
Additional paid-in capital			44,867				85,718
Retained earnings			614,480				565,129
Total stockholders’ equity			660,157				651,677
Total liabilities and stockholders’ equity		$	921,121			$	870,690

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)		2022				2021				2022				2021
Operating revenue		$	329,565			$	232,442			$	616,846			$	455,488
Operating expenses (income):
Salaries, wages and benefits			96,460				75,296				185,809				148,294
Purchased transportation			67,480				45,003				124,790				85,768
Fuel and fuel taxes			61,337				32,007				105,705				60,944
Supplies and maintenance			13,352				11,167				25,665				22,182
Depreciation			26,865				25,540				53,008				51,227
Operating taxes and licenses			2,663				2,718				5,303				5,430
Insurance and claims			13,443				9,391				26,147				20,837
Communications and utilities			2,239				2,056				4,504				4,139
Gain on disposition of revenue equipment			(4,812	)			(5,339	)			(9,352	)			(7,323	)
Other			9,601				6,085				18,472				11,474
Total operating expenses			288,628				203,924				540,051				402,972
Operating income			40,937				28,518				76,795				52,516
Other			(36	)			(9	)			(43	)			(19	)
Income before income taxes			40,973				28,527				76,838				52,535
Income taxes expense			9,312				7,109				17,644				13,111
Net income		$	31,661			$	21,418			$	59,194			$	39,424
Basic earnings per common share		$	0.39			$	0.26			$	0.72			$	0.48
Diluted earnings per common share		$	0.39			$	0.26			$	0.72			$	0.47
Dividends declared per common share		$	0.06			$	0.04			$	0.12			$	0.08

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)		2022				2021				2022 vs. 2021				2022 vs. 2021
Operating revenue:
Truckload revenue, net of fuel surcharge revenue		$	101,808			$	83,633			$	18,175				21.7	%
Truckload fuel surcharge revenue			25,164				12,308				12,856				104.5
Total Truckload revenue			126,972				95,941				31,031				32.3
Dedicated revenue, net of fuel surcharge revenue			84,389				67,227				17,162				25.5
Dedicated fuel surcharge revenue			25,966				12,894				13,072				101.4
Total Dedicated revenue			110,355				80,121				30,234				37.7
Intermodal revenue, net of fuel surcharge revenue			27,681				22,031				5,650				25.6
Intermodal fuel surcharge revenue			9,286				3,561				5,725				160.8
Total Intermodal revenue			36,967				25,592				11,375				44.4
Brokerage revenue			55,271				30,788				24,483				79.5
Total operating revenue		$	329,565			$	232,442			$	97,123				41.8	%
Operating income:
Truckload		$	16,088			$	13,197			$	2,891				21.9	%
Dedicated			14,039				10,617				3,422				32.2
Intermodal			4,097				1,850				2,247				121.5
Brokerage			6,713				2,854				3,859				135.2
Total operating income		$	40,937			$	28,518			$	12,419				43.5	%
Operating ratio:
Truckload			87.3	%			86.2	%
Dedicated			87.3				86.7
Intermodal			88.9				92.8
Brokerage			87.9				90.7
Consolidated operating ratio			87.6	%			87.7	%
Operating ratio, net of fuel surcharges:
Truckload			84.2	%			84.2	%
Dedicated			83.4				84.2
Intermodal			85.2				91.6
Brokerage			87.9				90.7
Consolidated operating ratio, net of fuel surcharges			84.8	%			86.0	%

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)		2022				2021				2022 vs. 2021				2022 vs. 2021
Operating revenue:
Truckload revenue, net of fuel surcharge revenue		$	196,978			$	167,552			$	29,426				17.6	%
Truckload fuel surcharge revenue			42,784				23,304				19,480				83.6
Total Truckload revenue			239,762				190,856				48,906				25.6
Dedicated revenue, net of fuel surcharge revenue			162,810				134,129				28,681				21.4
Dedicated fuel surcharge revenue			44,305				24,229				20,076				82.9
Total Dedicated revenue			207,115				158,358				48,757				30.8
Intermodal revenue, net of fuel surcharge revenue			53,286				41,477				11,809				28.5
Intermodal fuel surcharge revenue			15,323				6,119				9,204				150.4
Total Intermodal revenue			68,609				47,596				21,013				44.1
Brokerage revenue			101,360				58,678				42,682				72.7
Total operating revenue		$	616,846			$	455,488			$	161,358				35.4	%
Operating income:
Truckload		$	31,659			$	24,612			$	7,047				28.6	%
Dedicated			24,684				19,553				5,131				26.2
Intermodal			9,133				3,311				5,822				175.8
Brokerage			11,319				5,040				6,279				124.6
Total operating income		$	76,795			$	52,516			$	24,279				46.2	%
Operating ratio:
Truckload			86.8	%			87.1	%
Dedicated			88.1				87.7
Intermodal			86.7				93.0
Brokerage			88.8				91.4
Consolidated operating ratio			87.6	%			88.5	%
Operating ratio, net of fuel surcharges:
Truckload			83.9	%			85.3	%
Dedicated			84.8				85.4
Intermodal			82.9				92.0
Brokerage			88.8				91.4
Consolidated operating ratio, net of fuel surcharges			85.1	%			86.9	%

MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)

		Three Months								Six Months
		Ended June 30,								Ended June 30,
		2022				2021				2022				2021
Truckload Segment:
Revenue (in thousands)		$	126,972			$	95,941			$	239,762			$	190,856
Average revenue, net of fuel surcharges, per tractor per week(1)		$	5,080			$	4,146			$	5,030			$	4,101
Average tractors(1)			1,542				1,552				1,515				1,580
Average miles per trip			509				513				514				524
Non-revenue miles percentage(2)			10.7	%			9.6	%			10.6	%			9.9	%
Total miles (in thousands)			36,752				37,285				72,124				75,568
Dedicated Segment:
Revenue (in thousands)		$	110,355			$	80,121			$	207,115			$	158,358
Average revenue, net of fuel surcharges, per tractor per week(1)		$	4,072			$	3,268			$	3,962			$	3,241
Average tractors(1)			1,594				1,582				1,589				1,601
Average miles per trip			341				323				341				315
Non-revenue miles percentage(2)			1.0	%			1.1	%			1.1	%			0.9	%
Total miles (in thousands)			34,134				32,255				66,887				64,254
Intermodal Segment:
Revenue (in thousands)		$	36,967			$	25,592			$	68,609			$	47,596
Loads			8,703				8,646				16,997				16,628
Average tractors			175				148				169				141
Brokerage Segment:
Revenue (in thousands)		$	55,271			$	30,788			$	101,360			$	58,678
Loads			25,322				14,341				45,006				28,916
At June 30, 2022 and June 30, 2021:
Total tractors(1)			3,395				3,162
Average age of company tractors (in years)			1.6				1.5
Total trailers			5,521				5,299
Average age of company trailers (in years)			3.6				3.2
Ratio of trailers to tractors(1)			1.6				1.7
Total refrigerated containers			784				554

		Three Months								Six Months
		Ended June 30,								Ended June 30,
(In thousands)		2022				2021				2022				2021
Net cash provided by operating activities		$	58,730			$	39,795			$	98,670			$	83,365
Net cash (used for) investing activities			(35,413	)			(44,021	)			(35,004	)			(61,438	)
Net cash (used for) financing activities			(21,470	)			(3,685	)			(52,287	)			(7,382	)
Weighted average shares outstanding:
Basic			81,689				82,840				82,310				82,799
Diluted			82,015				83,397				82,617				83,384

(1	)	Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 85 and 118 tractors as of June 30, 2022 and 2021, respectively.
(2	)	Represents the percentage of miles for which the company is not compensated.