SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) April 28, 2004
HUB GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
0-27754 36-4007085
(Commission File Number) (I.R.S. Employer Identification No.)
3050 HIGHLAND PARKWAY, SUITE 100
DOWNERS GROVE, ILLINOIS 60515
(Address Of Principal Executive Offices, including Zip Code)
(630) 271-3600
(Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
(Former Name or Former Address, If Changed Since Last Report)
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Not applicable.
(b) Not applicable.
(c) A list of exhibits filed herewith is contained on the Exhibit
Index which immediately precedes such exhibits and is
incorporated herein by reference.
ITEM 9. INFORMATION PROVIDED UNDER ITEM 12 (RESULTS OF OPERATIONS AND
FINANCIAL CONDITION)
The following information is furnished pursuant to Item 12 "Results of
Operations and Financial Condition."
On April 28, 2004, Hub Group, Inc. issued a press release announcing its
first quarter 2004 operating results. The press release is
furnished as Exhibit 99.1 to this Form 8-K.
ITEM 9. REGULATION FD DISCLOSURE
The balance sheets and statements of cash flows are being presented for
purposes of complying with Regulation FD and are attached hereto as
exhibits 99.2 and 99.3.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HUB GROUP, INC.
Dated: April 28, 2004 /S/ THOMAS M. WHITE
-----------------------------------------
By: Thomas M. White
Its: Senior Vice President-
Chief Financial Officer and Treasurer
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
99.1 Press release issued on April 28, 2004 announcing operating
results for Hub Group, Inc. for the first quarter 2004.
99.2 Unaudited condensed consolidated balance sheets for the
period ending December 31, 2003 and March 31, 2004.
99.3 Unaudited condensed consolidated statements of cash flows
for the three months ended March 31, 2003 and 2004.
HUB GROUP, INC. REPORTS RECORD FIRST QUARTER 2004 RESULTS
Downers Grove, IL, April 28, 2004 - Hub Group, Inc. (NASDAQ: HUBG) today
reported a record first quarter representing a 99.6% increase in first quarter
net income versus the first quarter of 2003. Hub Group earned net income of $2.7
million or 33 cents diluted earnings per share for the quarter ended March 31,
2004 compared to last year's first quarter net income of $1.4 million or 18
cents diluted earnings per share on 7.4% higher average diluted shares
outstanding in the 2004 period.
Commenting on the results, David P. Yeager, Vice-Chairman and Chief Executive
Officer of Hub Group stated, "We are delighted with the improvement in our
profitability. We are making progress with our goals associated with the
organizational realignment, which became effective February 1, 2004. During the
remainder of the year, our management team will continue to focus on leveraging
our new structure to drive revenue growth, improve operating efficiency and
enhance customer service."
Transportation-related revenue, generated by the Company's intermodal, truckload
brokerage and logistics business units, increased 2.4% or $7.4 million in the
first quarter of 2004 compared to the first quarter of 2003. Intermodal revenue
increased 1.1% to $230.5 million due primarily to an increase in volume.
Truckload brokerage revenue increased 0.7% to $51.0 million due primarily to an
increase in revenue per load. Logistics revenue increased 12.5% to $39.7 million
due primarily to an increase in volume. Hub Group Distribution Services ("HGDS")
revenue decreased 54.1% to $7.1 million in 2004 from $15.5 million in 2003 due
primarily to lower installation business. Total revenue in the first quarter
2004 was $328.3 million, a decrease of 0.3% compared with the $329.3 million
reported for the first quarter of 2003. Gross margin as a percentage of revenue
decreased slightly from 12.8% in first quarter 2003 to 12.7% in first quarter
2004 due primarily to HGDS.
Costs and expenses decreased 5.8% in the first quarter of 2004 to $35.5 million
compared to $37.7 million in the first quarter of 2003, reflecting the benefits
from the Company's cost reduction efforts. Other expense, which primarily
includes interest expense, decreased to $1.6 million in the first quarter of
2004 compared to $2.1 million in the same period of 2003 due to lower debt
levels. During the first quarter of 2004, the Company paid down $5 million of
debt and modified the debt agreement with its bank group to provide for lower
interest rates.
FULL YEAR 2004 GUIDANCE:
Hub is comfortable with the range of analysts' estimates of diluted earnings per
share of $1.45 to $1.50 for 2004. This range represents an increase of 35% to
40% compared with diluted earnings per share for 2003.
ABOUT HUB GROUP: Hub Group, Inc. is a leading non-asset based freight
transportation management company providing comprehensive intermodal, truckload,
LTL, railcar, airfreight and related logistics and distribution services. The
Company operates through a network of over 30 offices throughout the United
States, Canada and Mexico.
Certain prior year amounts have been reclassified to conform to the current year
presentation.
CERTAIN FORWARD LOOKING STATEMENTS: Statements in this press release that are
not historical, including statements about analysts' estimates and Hub Group's
or management's intentions, beliefs, expectations, representations, projections,
plans or predictions of the future, are forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements are inherently uncertain and subject to risks. Such statements should
be viewed with caution. Actual results or experience could differ materially
from the forward-looking statements as a result of many factors. Factors that
could cause actual results to differ materially include the factors listed from
time to time in Hub Group's SEC reports including, but not limited to, the
annual report on Form 10-K for the year ended December 31, 2003. Hub Group
assumes no liability to update any such forward-looking statements.
HUB GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
UNAUDITED
THREE MONTHS
ENDED MARCH 31,
---------------------------
2004 2003
------------ --------------
Revenue $ 328,302 $ 329,284
Transportation costs 286,498 287,234
------------ -------------
Gross margin 41,804 42,050
Costs and expenses:
Salaries and benefits 22,342 23,328
Selling, general and administrative 10,281 11,788
Depreciation and amortization of property and equipment 2,884 2,561
------------ -------------
Total costs and expenses 35,507 37,677
------------ -------------
Operating income 6,297 4,373
Other income (expense):
Interest expense (1,713) (2,084)
Interest income 53 50
Other, net 41 (36)
------------ -------------
Total other expense (1,619) (2,070)
Income before provision for income taxes 4,678 2,303
Provision for income taxes 1,965 944
------------ -------------
Net income $ 2,713 $ 1,359
============ =============
Basic EPS $ 0.33 $ 0.18
============ =============
Diluted EPS $ 0.33 $ 0.18
============ =============
Basic weighted average number of shares outstanding 7,746 7,709
============ =============
Diluted weighted average number of shares outstanding 8,294 7,722
============ =============
HUB GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
| March 31, 2004 |
December 31, 2003 | ||||
|---|---|---|---|---|---|
| ASSETS | |||||
| CURRENT ASSETS: | |||||
| Cash and cash equivalents | $ — | $ — | |||
| Accounts receivable | |||||
| Trade, net | 121,184 | 126,794 | |||
| Other | 11,616 | 9,472 | |||
| Deferred taxes | 4,676 | 4,676 | |||
| Prepaid expenses and other current assets | 4,116 | 4,578 | |||
| TOTAL CURRENT ASSETS | 141,592 |
145,520 |
|||
| PROPERTY AND EQUIPMENT, net | 25,422 | 27,855 | |||
| GOODWILL, net | 215,175 | 215,175 | |||
| OTHER ASSETS | 829 | 1,017 | |||
| TOTAL ASSETS | $ 383,018 | $ 389,567 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||
| CURRENT LIABILITIES: | |||||
| Accounts payable | |||||
| Trade | $ 116,331 | $ 118,830 | |||
| Other | 3,187 | 2,555 | |||
| Accrued expenses | |||||
| Payroll | 10,677 | 14,157 | |||
| Other | 11,000 | 11,592 | |||
| Current portion of long-term debt | 8,012 | 8,017 | |||
| TOTAL CURRENT LIABILITIES | 149,207 |
155,151 |
|||
| LONG-TERM DEBT, EXCLUDING CURRENT PORTION | 62,011 | 67,017 | |||
| DEFERRED TAXES | 25,768 | 24,364 | |||
| STOCKHOLDERS' EQUITY: | |||||
| Preferred stock, $.01 par value, 2,000,000 shares authorized; no shares | |||||
| issued or outstanding in 2004 and 2003 | — | — | |||
| Common stock, | |||||
| Class A: $.01 par value; 12,337,700 shares authorized; 7,552,977 shares | |||||
| issued and 7,436,277 outstanding in 2004; 7,410,700 issued and | |||||
| 7,390,500 outstanding in 2003 | 74 | 74 | |||
| Class B: $.01 par value; 662,300 shares authorized; 662,296 shares issued | |||||
| and outstanding in 2004 and 2003 | 7 | 7 | |||
| Additional paid-in capital | 118,925 | 115,820 | |||
| Purchase price in excess of predecessor basis, net of tax benefit of $10,306 | (15,458 | ) | (15,458 | ) | |
| Retained earnings | 50,045 | 47,332 | |||
| Unearned Compensation | (4,502 | ) | (4,448 | ) | |
| Treasury Stock, at cost (116,700 shares in 2004 and 20,200 shares in 2003) | (3,059 | ) | (292 | ) | |
| TOTAL STOCKHOLDERS' EQUITY | 146,032 | 143,035 | |||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 383,018 | $ 389,567 | |||
HUB GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
| Three Months Ended March 31, | |||||
|---|---|---|---|---|---|
| 2004 |
2003 | ||||
| Cash flows from operating activities: | |||||
| Net income | $ 2,713 | $ 1,359 | |||
| Adjustments to reconcile net income to net cash provided | |||||
| by operating activities: | |||||
| Depreciation and amortization of property and equipment | 2,911 | 2,574 | |||
| Deferred taxes | 1,961 | 945 | |||
| Compensation expense related to restricted stock | 404 | — | |||
| (Gain) Loss on sale of assets | (18 | ) | 8 | ||
| Other assets | 188 | (208 | ) | ||
| Changes in working capital: | |||||
| Accounts receivable, net | 3,466 | (1,476 | ) | ||
| Prepaid expenses and other current assets | 462 | (559 | ) | ||
| Accounts payable | (1,867 | ) | (708 | ) | |
| Accrued expenses | (4,072 | ) | 566 | ||
| Net cash provided by operating activities | 6,148 | 2,501 | |||
| Cash flows from investing activities: | |||||
| Purchases of property and equipment, net | (460 | ) | (477 | ) | |
| Net cash used in investing activities | (460 | ) | (477 | ) | |
| Cash flows from financing activity: | |||||
| Proceeds from stock options exercised | 2,090 | — | |||
| Purchase of treasury stock | (2,767 | ) | — | ||
| Net payments on revolver | (3,000 | ) | — | ||
| Payments on long-term debt | (2,011 | ) | (2,024 | ) | |
| Net cash used in financing activities | (5,688 | ) | (2,024 | ) | |
| Net increase (decrease) in cash and cash equivalents | — | — | |||
| Cash and cash equivalents beginning of period | — | — | |||
| Cash and cash equivalents end of period | $ — | $ — | |||
| Supplemental disclosures of cash flow information | |||||
| Cash paid for: | |||||
| Interest | $ 1,357 | $ 1,732 | |||