Saia, Inc. (Nasdaq: SAIA), a leading transportation provider
offering multi-regional less-than-truckload (LTL), non-asset
truckload, expedited and logistics services, today reported first
quarter 2019 financial results. Diluted earnings per share in the
quarter were $0.85 compared to $0.80 in the first quarter of 2018.
First Quarter 2019 Compared to First Quarter 2018
Results
- Revenues were $410.6 million, a 4.5% increase
- Operating income was $28.6 million, a 3.8% increase
- Operating ratio was flat at 93.0
- LTL shipments per workday decreased 0.1%
- LTL tonnage per workday decreased 3.5%
- LTL revenue per hundredweight increased 10.6%
- LTL revenue per shipment rose 6.8% to $230.43
“In the first quarter we saw continued success with selling our
value proposition to customers and we were able to increase LTL
revenue per hundred weight by 10.6% including average contractual
renewal rates that rose 9.8% in the quarter. This increase in
LTL yield marked the 35th consecutive quarter of year-over-year
improvement, reflecting our improving service reach and record low
cargo claims ratio”, said Saia Chief Executive Officer, Rick
O’Dell.
“While first quarter 2019 diluted earnings per share were a
first quarter record, we are disappointed that we were not able to
bring more of our strong yield improvements to the bottom
line. The first quarter is typically the seasonally softest
period of the year and we simply incurred too many weather-related
volume and cost impacts to reach our profitability goals in the
period. Winter weather throughout the quarter caused parts of
our network to be interrupted on an almost weekly basis”, O’Dell
continued.
“We opened one additional terminal in the Northeast in the first
quarter and have plans to open an additional four or five in that
region over the remainder of the year. Broadening our direct
service coverage area is resonating with customers and nearly 70%
of our business in and out of the Northeast is coming from
customers who were already using Saia in other parts of the
country”, concluded O’Dell.
Financial Position and Capital Expenditures
Total debt was $148.9 million at March 31, 2019 and inclusive of
the cash on-hand, net debt to total capital was 17.2%. This
compares to total debt of $142.6 million and net debt to total
capital of 19.0% at March 31, 2018.
Net capital expenditures in the first quarter of 2019 were $56.5
million including equipment acquired with capital leases.
This compares to $52.1 million in net capital expenditures in the
first quarter of 2018. In 2019, we anticipate net capital
expenditures of $275-$300 million.
Conference Call
Management will hold a conference call to discuss quarterly
results today at 10:00 a.m. Eastern Time. To participate in the
call, please dial 800-458-4121 or 323-794-2093 referencing
conference ID #2680729. Callers should dial in five to ten
minutes in advance of the conference call. This call will be
webcast live via the Company website at www.saia.com. A
replay of the call will be offered two hours after the completion
of the call through May 29, 2019 at 1:00 p.m. Eastern Time.
The replay will be available by dialing 888-203-1112.
Saia, Inc. (Nasdaq: SAIA) offers customers a
wide range of less-than-truckload, non-asset truckload, expedited
and logistics services. With headquarters in Georgia, Saia
LTL Freight operates 162 terminals across 42 states. For more
information on Saia, Inc. visit the Investor Relations section at
www.saia.com.
Cautionary Note Regarding
Forward-Looking Statements
The Securities and Exchange Commission
encourages companies to disclose forward-looking information so
that investors can better understand the future prospects of a
company and make informed investment decisions. This news release
may contain these types of statements, which are “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995.
Words such as “anticipate,” “estimate,”
“expect,” “project,” “intend,” “may,” “plan,” “predict,” “believe,”
“should” and similar words or expressions are intended to identify
forward-looking statements. Investors should not place undue
reliance on forward-looking statements and the Company undertakes
no obligation to publicly update or revise any forward-looking
statements. All forward-looking statements reflect the present
expectation of future events of our management as of the date of
this news release and are subject to a number of important factors,
risks, uncertainties and assumptions that could cause actual
results to differ materially from those described in any
forward-looking statements. These factors, risks, uncertainties and
assumptions include, but are not limited to, (1) general economic
conditions including downturns in the business cycle; (2)
effectiveness of Company-specific performance improvement
initiatives, including management of the cost structure to match
shifts in customer volume levels; (3) the creditworthiness of our
customers and their ability to pay for services; (4) failure to
achieve acquisition synergies; (5) failure to operate and grow
acquired businesses in a manner that supports the value allocated
to these acquired businesses;
(6) economic declines in the geographic regions
or industries in which our customers operate; (7) competitive
initiatives and pricing pressures, including in connection with
fuel surcharge; (8) loss of significant customers; (9) the
Company’s need for capital and uncertainty of the credit markets;
(10) the possibility of defaults under the Company’s debt
agreements (including violation of financial covenants); (11)
possible issuance of equity which would dilute stock ownership;
(12) integration risks; (13) the effect of litigation including
class action lawsuits; (14) cost and availability of qualified
drivers, fuel, purchased transportation, real property, revenue
equipment, technology and other assets; (15) the effect of
governmental regulations, including but not limited to Hours of
Service, engine emissions, the Compliance, Safety, Accountability
(CSA) initiative, the Food and Drug Administration, compliance with
legislation requiring companies to evaluate their internal control
over financial reporting, Homeland Security, environmental
regulations, tax law changes and potential changes to the North
American Free Trade Agreement and to certain international tariffs;
(16) changes in interpretation of accounting principles; (17)
dependence on key employees; (18) inclement weather; (19) labor
relations, including the adverse impact should a portion of the
Company’s workforce become unionized; (20) terrorism risks; (21)
self-insurance claims and other expense volatility; (22) risks
arising from international business operations and relationships;
(23) cost and availability of insurance coverage, including the
possibility the Company may be required to pay additional premiums
under its auto liability policy; (24) increased costs of healthcare
and prescription drugs, including as a result of healthcare reform
legislation; (25) social media risks; (26) disruption in or failure
of the Company’s technology or equipment, including services
essential to operations of the Company and/or cyber security risk;
(27) failure to successfully execute the strategy to expand the
Company’s service geography into the Northeastern United States;
and (28) other financial, operational and legal risks and
uncertainties detailed from time to time in the Company’s SEC
filings.
As a result of these and other factors, no
assurance can be given as to our future results and achievements.
Accordingly, a forward-looking statement is neither a prediction
nor a guarantee of future events or circumstances and those future
events or circumstances may not occur. You should not place undue
reliance on the forward-looking statements, which speak only as of
the date of this press release. We are under no obligation, and we
expressly disclaim any obligation, to update or alter any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Saia, Inc. and Subsidiaries |
|
Condensed Consolidated Balance
Sheets |
|
(Amounts in thousands) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
March 31,2019 |
|
December 31,2018 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
31 |
|
|
$ |
2,194 |
|
|
Accounts
receivable, net |
|
|
202,133 |
|
|
|
181,612 |
|
|
Prepaid
expenses and other |
|
|
38,923 |
|
|
|
29,567 |
|
|
Total current assets |
|
|
241,087 |
|
|
|
213,373 |
|
|
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT: |
|
|
|
|
|
Cost |
|
|
1,553,938 |
|
|
|
1,521,341 |
|
|
Less:
accumulated depreciation |
|
|
648,408 |
|
|
|
628,283 |
|
|
Net property and equipment |
|
|
905,530 |
|
|
|
893,058 |
|
|
OPERATING LEASE
RIGHT-OF-USE ASSETS |
|
|
72,460 |
|
|
|
– |
|
|
OTHER ASSETS |
|
|
27,780 |
|
|
|
27,312 |
|
|
Total assets |
|
$ |
1,246,857 |
|
|
$ |
1,133,743 |
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
Accounts
payable |
|
$ |
71,983 |
|
|
$ |
78,994 |
|
|
Wages and
employees' benefits |
|
|
38,834 |
|
|
|
48,116 |
|
|
Other
current liabilities |
|
|
65,345 |
|
|
|
64,118 |
|
|
Current
portion of long-term debt |
|
|
17,914 |
|
|
|
18,082 |
|
|
Current
portion of operating lease liability |
|
|
17,390 |
|
|
|
– |
|
|
Total current liabilities |
|
|
211,466 |
|
|
|
209,310 |
|
|
|
|
|
|
|
|
OTHER LIABILITIES: |
|
|
|
|
|
Long-term
debt, less current portion |
|
|
130,964 |
|
|
|
104,777 |
|
|
Operating
lease liability, less current portion |
|
|
58,035 |
|
|
|
– |
|
|
Deferred
income taxes |
|
|
92,208 |
|
|
|
86,893 |
|
|
Claims,
insurance and other |
|
|
36,534 |
|
|
|
36,899 |
|
|
Total other liabilities |
|
|
317,741 |
|
|
|
228,569 |
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY: |
|
|
|
|
|
Common
stock |
|
|
26 |
|
|
|
26 |
|
|
Additional paid-in capital |
|
|
254,575 |
|
|
|
254,738 |
|
|
Deferred
compensation trust |
|
|
(3,691 |
) |
|
|
(3,381 |
) |
|
Retained
earnings |
|
|
466,740 |
|
|
|
444,481 |
|
|
Total stockholders' equity |
|
|
717,650 |
|
|
|
695,864 |
|
|
Total liabilities and stockholders' equity |
|
$ |
1,246,857 |
|
|
$ |
1,133,743 |
|
|
|
|
|
|
|
|
Saia, Inc. and Subsidiaries |
Consolidated Statements of
Operations |
For the Quarters Ended March 31, 2019 and
2018 |
(Amounts in thousands, except per share
data) |
(Unaudited) |
|
|
|
|
|
First Quarter |
|
|
|
2019 |
|
|
|
2018 |
|
OPERATING REVENUE |
|
$ |
410,584 |
|
|
$ |
392,805 |
|
|
|
|
|
|
OPERATING
EXPENSES: |
|
|
|
|
Salaries,
wages and employees' benefits |
|
|
220,352 |
|
|
|
211,124 |
|
Purchased
transportation |
|
|
28,418 |
|
|
|
29,916 |
|
Fuel,
operating expenses and supplies |
|
|
83,543 |
|
|
|
78,794 |
|
Operating
taxes and licenses |
|
|
13,202 |
|
|
|
12,150 |
|
Claims
and insurance |
|
|
9,530 |
|
|
|
10,191 |
|
Depreciation and amortization |
|
|
26,782 |
|
|
|
23,030 |
|
Loss from
property disposals, net |
|
|
126 |
|
|
|
21 |
|
Total operating expenses |
|
|
381,953 |
|
|
|
365,226 |
|
|
|
|
|
|
OPERATING
INCOME |
|
|
28,631 |
|
|
|
27,579 |
|
|
|
|
|
|
NONOPERATING EXPENSES
(INCOME): |
|
|
|
|
Interest
expense |
|
|
1,383 |
|
|
|
1,226 |
|
Other,
net |
|
|
(334 |
) |
|
|
(103 |
) |
Nonoperating expenses, net |
|
|
1,049 |
|
|
|
1,123 |
|
|
|
|
|
|
INCOME BEFORE INCOME
TAXES |
|
|
27,582 |
|
|
|
26,456 |
|
Income
tax expense |
|
|
5,323 |
|
|
|
5,331 |
|
NET INCOME |
|
$ |
22,259 |
|
|
$ |
21,125 |
|
|
|
|
|
|
Average common shares
outstanding - basic |
|
|
25,873 |
|
|
|
25,698 |
|
Average common shares
outstanding - diluted |
|
|
26,322 |
|
|
|
26,308 |
|
|
|
|
|
|
Basic earnings per
share |
|
$ |
0.86 |
|
|
$ |
0.82 |
|
Diluted earnings per
share |
|
$ |
0.85 |
|
|
$ |
0.80 |
|
|
|
|
|
|
Saia, Inc. and Subsidiaries |
|
Condensed Consolidated Statements of Cash
Flows |
|
For the three months ended March 31, 2019 and
2018 |
|
(Amounts in thousands) |
|
(Unaudited) |
|
|
|
First Quarter |
|
|
|
|
2019 |
|
|
|
2018 |
|
|
OPERATING ACTIVITIES: |
|
|
|
|
|
Net cash
provided by operating activities |
|
$ |
30,400 |
|
|
$ |
35,502 |
|
|
Net cash provided by operating activities |
|
|
30,400 |
|
|
|
35,502 |
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES: |
|
|
|
|
|
Acquisition of property and equipment |
|
|
(56,741 |
) |
|
|
(46,881 |
) |
|
Proceeds
from disposal of property and equipment |
|
|
275 |
|
|
|
100 |
|
|
Net cash used in investing activities |
|
|
(56,466 |
) |
|
|
(46,781 |
) |
|
|
|
|
|
|
|
FINANCING ACTIVITIES: |
|
|
|
|
|
Borrowing
of revolving credit agreement, net |
|
|
30,608 |
|
|
|
7,832 |
|
|
Proceeds
from stock option exercises |
|
|
1,798 |
|
|
|
4,018 |
|
|
Shares
withheld for taxes |
|
|
(3,268 |
) |
|
|
(1,302 |
) |
|
Other
financing activity |
|
|
(5,235 |
) |
|
|
(3,493 |
) |
|
Net cash provided by financing activities |
|
|
23,903 |
|
|
|
7,055 |
|
|
|
|
|
|
|
|
NET
DECREASE IN CASH AND CASH EQUIVALENTS |
|
|
(2,163 |
) |
|
|
(4,224 |
) |
|
CASH AND
CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
|
2,194 |
|
|
|
4,720 |
|
|
CASH AND
CASH EQUIVALENTS, END OF PERIOD |
|
$ |
31 |
|
|
$ |
496 |
|
|
|
|
|
|
|
|
NON-CASH
ITEMS: |
|
|
|
|
|
Equipment financed with finance leases |
|
$ |
– |
|
|
$ |
5,318 |
|
|
|
|
|
|
|
|
Saia, Inc. and Subsidiaries |
|
Financial
Information |
|
For the Quarters Ended March 31, 2019 and
2018 |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter |
|
|
|
|
|
First Quarter |
|
% |
|
Amount/Workday |
|
% |
|
|
|
|
2019 |
|
|
|
2018 |
|
|
Change |
|
2019 |
|
2018 |
|
Change |
|
Workdays |
|
|
|
|
|
|
63 |
|
64 |
|
|
|
Operating
ratio |
|
93.0 |
% |
|
|
93.0 |
% |
|
|
|
|
|
|
|
|
|
LTL tonnage
(1) |
|
1,139 |
|
|
|
1,199 |
|
|
(5.0 |
) |
|
18.07 |
|
18.73 |
|
(3.5 |
) |
|
LTL
shipments (1) |
|
1,741 |
|
|
|
1,770 |
|
|
(1.6 |
) |
|
27.63 |
|
27.65 |
|
(0.1 |
) |
|
LTL
revenue/cwt. |
$ |
17.61 |
|
|
$ |
15.92 |
|
|
10.6 |
|
|
|
|
|
|
|
|
LTL
revenue/shipment |
$ |
230.43 |
|
|
$ |
215.79 |
|
|
6.8 |
|
|
|
|
|
|
|
|
LTL
pounds/shipment |
|
1,308 |
|
|
|
1,355 |
|
|
(3.5 |
) |
|
|
|
|
|
|
|
LTL length
of haul (2) |
|
831 |
|
|
|
837 |
|
|
(0.7 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1 |
) |
In thousands. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2 |
) |
In miles. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note: |
LTL operating statistics exclude transportation
and logistics services where pricing is generally not determined by
weight. The LTL operating statistics also exclude the
adjustment required for financial statement purposes in accordance
with the Company's revenue recognition policy. |
|
|
|
|
CONTACT: Saia, Inc.Doug
Coldcol@saia.com678.542.3910
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