Form 8-K

 

 

UNITED STATES

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) February 18, 2015

 

 

Universal Truckload Services, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Michigan   0-51142   38-3640097

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

12755 E. Nine Mile Road, Warren, Michigan

(Address of principal executive offices)

48089

(Zip Code)

(586) 920-0100

(Registrant’s telephone number, including area code)

 

(Former name, former address and former fiscal year, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On February 19, 2015, Universal Truckload Services, Inc. (the Company) issued a press release announcing the Company’s financial and operating results for the thirteen weeks and year ended December 31, 2014, a copy of which is furnished as Exhibit 99.1 to this Form 8-K.

 

Item 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

On February 18, 2015 the Board of Directors appointed Jeffrey A. Rogers, the Company’s Chief Executive Officer, as a director, effective immediately. Mr. Rogers will receive no additional compensation for his services as a director while he is employed by the Company.

 

Item 8.01 OTHER EVENTS

On February 19, 2015, the Company issued a press release announcing that the Company’s Board of Directors declared a quarterly cash dividend of $0.07 per share of common stock. The dividend is payable to the Company’s shareholders of record at the close of business on March 2, 2015, and is expected to be paid on March 12, 2015. A copy of the press release is furnished as Exhibit 99.1 to this Form 8-K.

 

Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS

 

(d) Exhibits.

 

Exhibit
No.

  

Description

99.1    Press Release dated February 19, 2015.


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, thereunto duly authorized.

 

UNIVERSAL TRUCKLOAD SERVICES, INC.
Date: February 20, 2015

/s/ David A. Crittenden

David A. Crittenden
Chief Financial Officer
EX-99.1

Exhibit 99.1

 

LOGO

For further information:

David A. Crittenden

Chief Financial Officer

DCrittenden@goutsi.com

(586) 467-1427

Universal Truckload Services, Inc. Reports 2014 Financial Results

Warren, MI – February 19, 2015 — Universal Truckload Services, Inc. (NASDAQ: UACL) today reported 2014 consolidated net income of $45.4 million, or $1.51 per basic and diluted share, on total operating revenue of $1.19 billion. Net income in the fourth quarter of 2014 totaled $10.5 million, or $0.35 per basic and diluted share, on total operating revenue of $302.5 million. This compares to $11.3 million of net income on total operating revenue of $259.5 million in the fourth quarter of 2013.

Operating revenues from transportation services increased $15.4 million, or 8.6%, to $195.2 million in the quarter ended December 31, 2014, from the comparable period last year, due to a 4.2% year-over-year increase in loads and a 7.7% increase in average operating revenues per load. Value-added services revenues increased $21.6 million in the most recent quarter. However, revenues from subsidiaries delivering these services that have been included in our consolidated financial results for more than one year declined 11.2%, or $5.4 million, due to the conclusion of certain customer operations. Revenues from intermodal services increased 18.6%, to $37.4 million from $31.6 million in the fourth quarter of 2013. The $5.9 million net increase in revenues from intermodal services includes a $6.3 million, or 22.7% increase in our intermodal drayage services, which is benefiting from increased import activity.

In the aggregate, income from operations declined 1.6% to $18.8 million, compared to $19.1 million in the fourth quarter of 2013. Income from operations in our transportation segment increased 35.2% to $9.6 million or 4.7% of segment operating revenues for the fourth quarter of 2014, which compares to $7.1 million or 4.0% of segment operating revenues for the fourth quarter of 2013. Income from operations in our logistics segment, which includes value-added services and dedicated transportation services, decreased 12.6% to $11.1 million or 11.3% of operating revenues for the fourth quarter of 2014. This compares to $12.7 million or 15.2% of operating revenues one year earlier.

As previously announced, operating activities in late 2014 broadly achieved fourth quarter performance expectations. Universal’s 2014 net income also reflects the following developments:

 

    The recognition of a $2 million accounting reserve for an uncollectible account related to a customer in the oil exploration industry.

 

    Non-cash charges totaling approximately $1 million related primarily to the retirement of our former chief executive officer.

Universal’s new Chief Executive Officer, Jeff Rogers, commented, “2014 was a period of operational and leadership transition for Universal. Our truckload transportation and intermodal businesses enjoyed favorable demand and pricing environments throughout the year. I am also somewhat encouraged by margin improvements in Universal’s value-added operations, where we are working hard to restore historic margin trends, following a difficult operating environment earlier in the year. The financial performance of our dedicated transportation operations remains subpar, though, and we will respond appropriately.


“Looking ahead, we do see generally favorable economic conditions for our largest industrial and retail customers through 2015 and even beyond. Over the next few years, my objective for our organization is to further refine Universal’s unique capabilities, creating a blueprint for exceptional growth in both revenues and margins.”

Universal calculates and reports selected financial metrics in connection with lending arrangements, or 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.”

As of December 31, 2014, we held cash and cash equivalents totaling $8.0 million and marketable securities totaling $14.3 million. Outstanding debt at year end totaled $235.3 million and obligations pursuant to capital leases were valued at $3.0 million.

Universal Truckload Services, Inc. announced today that our Board of Directors has declared a quarterly cash dividend of $0.07 per share of common stock. The dividend is payable to shareholders of record at the close of business on March 2, 2015 and is expected to be paid on March 12, 2015. The Board of Directors also appointed Mr. Rogers as a director of Universal, effective immediately.

Conference call:

We invite analysts and investors to participate in our 2014 financial performance conference call, during which Jeff Rogers and David Crittenden, CFO, will discuss fourth quarter 2014 financial performance, recent corporate developments, our current business outlook, and expectations for future revenue growth and margin expansion.

 

Time: 10:00 AM ET
Date: Friday, February 20, 2015
Call Toll Free: (866) 622-0924
International Dial-in: +1 (660) 422-4956
Conference ID: 82605487

A replay of the conference will be available two hours after the call through March 19, 2015, by calling (855) 859-2056 (toll free) or +1 (404) 537-3406 (toll) and using conference ID 82605487. Additionally, the call will be available on investors.goutsi.com.

About Universal:

Universal Truckload Services, Inc. is a leading asset-light provider of customized transportation and logistics solutions throughout the United States, Mexico and Canada. 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 transportation, value-added, and intermodal 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 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 TRUCKLOAD SERVICES, INC.

Unaudited Condensed Consolidated Statements of Income

(In thousands, except per share data)

 

     Thirteen Weeks Ended
December 31,
    Year Ended
December 31,
 
     2014     2013     2014     2013  

Operating revenues:

        

Transportation services

   $ 195,210      $ 179,785      $ 769,308      $ 706,998   

Value-added services

     69,837        48,199        284,496        195,086   

Intermodal services

     37,433        31,564        137,717        131,408   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating revenues

  302,480      259,548      1,191,521      1,033,492   

Operating expenses:

Purchased transportation and equipment rent

  159,115      140,434      615,327      560,024   

Direct personnel and related benefits

  50,636      45,544      205,905      178,441   

Commission expense

  11,482      9,994      43,922      39,248   

Operating expense (exclusive of items shown separately)

  25,589      21,442      115,154      79,263   

Occupancy expense

  6,650      5,126      26,520      20,049   

Selling, general and administrative

  13,156      8,601      44,814      33,046   

Insurance and claims

  8,138      4,337      25,991      19,242   

Depreciation and amortization

  8,921      4,937      33,053      19,686   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

  283,687      240,415      1,110,686      948,999   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from operations

  18,793      19,133      80,835      84,493   

Interest expense, net

  (2,096   (912   (8,183   (4,036

Other non-operating income

  132      93      447      459   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before provision for income taxes

  16,829      18,314      73,099      80,916   

Provision for income taxes

  6,310      7,012      27,729      30,344   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

$ 10,519    $ 11,302    $ 45,370    $ 50,572   
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per common share:

Basic

$ 0.35    $ 0.38    $ 1.51    $ 1.68   

Diluted

$ 0.35    $ 0.38    $ 1.51    $ 1.68   

Weighted average number of common shares outstanding:

Basic

  29,946      30,083      30,013      30,064   

Diluted

  29,952      30,127      30,044      30,160   

Dividends paid per common share

$ 0.07    $ 0.07    $ 0.28    $ 0.14   
  

 

 

   

 

 

   

 

 

   

 

 

 


UNIVERSAL TRUCKLOAD SERVICES, INC.

Unaudited Condensed Consolidated Balance Sheets

(In thousands)

 

     December 31,
2014
     December 31,
2013
 

Assets

     

Cash and cash equivalents

   $ 8,001       $ 10,223   

Marketable securities

     14,309         11,626   

Accounts receivable - net

     151,107         132,001   

Other current assets

     42,863         49,539   
  

 

 

    

 

 

 

Total current assets

  216,280      203,389   

Property and equipment - net

  178,069      142,656   

Other long-term assets - net

  134,665      144,091   
  

 

 

    

 

 

 

Total assets

$ 529,014    $ 490,136   
  

 

 

    

 

 

 

Liabilities and shareholders’ equity

Current liabilities, excluding current maturities of capital lease obligations and debt

$ 103,389    $ 93,896   

Capital lease obligations

  3,031      4,643   

Debt

  235,298      237,500   

Other long-term liabilities

  50,135      48,532   
  

 

 

    

 

 

 

Total liabilities

  391,853      384,571   

Total shareholders’ equity

  137,161      105,565   
  

 

 

    

 

 

 

Total liabilities and shareholders’ equity

$ 529,014    $ 490,136   
  

 

 

    

 

 

 


UNIVERSAL TRUCKLOAD SERVICES, INC.

Unaudited Summary of Operating Data

 

     Thirteen Weeks Ended
December 31,
     Year Ended
December 31,
 
     2014      2013      2014      2013  

Transportation Services:

           

Average operating revenues per loaded mile (a)

   $ 3.03       $ 2.83       $ 2.99       $ 2.78   

Average operating revenues per loaded mile, excluding fuel surcharges, where separately identifiable (a)

   $ 2.68       $ 2.43       $ 2.61       $ 2.39   

Average operating revenues per load (a)

   $ 1,096       $ 1,018       $ 1,064       $ 1,012   

Average operating revenues per load, excluding fuel surcharges, where separately identifiable (a)

   $ 970       $ 874       $ 928       $ 870   

Average length of haul (a) (b)

     362         360         356         364   

Number of loads (a)

     161,862         155,382         643,375         619,055   

Value Added Services:

           

Number of facilities (d)

           

Customer provided

     15         17         15         17   

Company leased

     30         26         30         26   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total

  45      43      45      43   

Intermodal Services:

Drayage (in thousands)

$ 34,276    $ 27,944    $ 124,609    $ 109,224   

Domestic Intermodal (in thousands)

  665      1,267      3,315      12,153   

Depot (in thousands)

  2,492      2,353      9,793      10,031   
  

 

 

    

 

 

    

 

 

    

 

 

 
$ 37,433    $ 31,564    $ 137,717    $ 131,408   
  

 

 

    

 

 

    

 

 

    

 

 

 

Average operating revenues per loaded mile (c)

$ 5.60    $ 4.86    $ 5.39    $ 4.64   

Average operating revenues per loaded mile, excluding fuel surcharges, where separately identifiable (c)

$ 4.55    $ 3.91    $ 4.35    $ 3.74   

Average operating revenues per load (c)

$ 414    $ 389    $ 404    $ 356   

Average operating revenues per load, excluding fuel surcharges, where separately identifiable (c)

$ 336    $ 313    $ 326    $ 286   

Number of loads (c)

  82,830      71,744      308,509      307,116   

Number of container yards

  11      11      11      11   

 

(a) Excludes operating data from Universal Logistics Solutions, Inc. and Universal Logistics Solutions International, Inc. in order to improve the relevance of the statistical data related to our brokerage services and improve the comparability to our peer companies. Also excludes final mile delivery and shuttle service loads.
(b) Average length of haul is computed using loaded miles, excluding final mile delivery and shuttle service loads.
(c) Excludes operating data from Universal Logistics Solutions, Inc. in order to improve the relevance of the statistical data related to our intermodal services and improve the comparability to our peer companies.
(d) Excludes storage yards, terminals and office facilities.


UNIVERSAL TRUCKLOAD SERVICES, INC.

Unaudited Summary of Operating Data - Continued

 

     Thirteen Weeks Ended     Year Ended  
     December 31,     December 31,  
     2014     2013     2014     2013  

Average Headcount

        

Employees

     4,173        3,741        4,219        3,449   

Full time equivalents

     1,446        1,764        1,528        1,786   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

  5,619      5,505      5,747      5,235   

Average number of tractors

Provided by owner-operators

  3,239      3,335      3,305      3,343   

Owned

  839      721      808      701   

Third party lease

  74      127      67      80   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

  4,152      4,183      4,180      4,123   

Operating Revenues by Segment:

Transportation

$ 203,936    $ 176,182    $ 778,603    $ 705,557   

Logistics

  98,458      83,254      412,507      327,498   

Other

  86      112      411      437   
  

 

 

   

 

 

   

 

 

   

 

 

 
$ 302,480    $ 259,548    $ 1,191,521    $ 1,033,492   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income from Operations by Segment:

Transportation

$ 9,584    $ 7,056    $ 34,931    $ 28,537   

Logistics

  11,138      12,692      50,892      58,724   

Other

  (1,929   (615   (4,988   (2,768
  

 

 

   

 

 

   

 

 

   

 

 

 
$ 18,793    $ 19,133    $ 80,835    $ 84,493   
  

 

 

   

 

 

   

 

 

   

 

 

 


Non-GAAP Financial Measures

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 adjusted income from operations and adjusted EBITDA as supplemental measures of our performance. We define adjusted income from operations as income from operations adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance, including transaction and other costs related to our acquisition of Westport. We define adjusted EBITDA as net income plus (i) interest expense, net, (ii) provision for income taxes and (iii) depreciation and amortization, and less other non-operating income, or EBITDA, further adjusted to eliminate the impact of certain items that we do not consider indicative of our ongoing operating performance, including transaction and other costs related to our acquisition of Westport. These further adjustments are itemized below. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating adjusted income from operations and adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of adjusted income from operations and adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.

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 income from operations, the most comparable GAAP measure, to adjusted income from operations; and of net income, the most comparable GAAP measure, to EBITDA and adjusted EBITDA for each of the periods indicated:

 

     Thirteen Weeks Ended
December 31,
    Year Ended
December 31,
 
     2014     2013     2014     2013  
     (in thousands)     (in thousands)  

Adjusted income from operations

        

Income from operations

   $ 18,793      $ 19,133      $ 80,835      $ 84,493   

Transaction and other costs (a)

     —          723        —          723   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted income from operations

$ 18,793    $ 19,856    $ 80,835    $ 85,216   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating margin (b)

  6.2   7.4   6.8   8.2

Adjusted operating margin (b)

  6.2   7.7   6.8   8.2

Adjusted EBITDA

Net income

$ 10,519    $ 11,302    $ 45,370    $ 50,572   

Provision for income taxes

  6,310      7,012      27,729      30,344   

Interest expense, net

  2,096      912      8,183      4,036   

Depreciation and amortization

  8,921      4,937      33,053      19,686   

Other non-operating income

  (132   (93   (447   (459
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

  27,714      24,070      113,888      104,179   

Transaction and other costs (a)

  —        723      —        723   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

$ 27,714    $ 24,793    $ 113,888    $ 104,902   
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA margin (b)

  9.2   9.3   9.6   10.1

Adjusted EBITDA margin (b)

  9.2   9.6   9.6   10.2

 

(a) Represents transaction and other costs incurred that were directly related to the acquisitions of Westport in December 2013.
(b) Operating margin, adjusted operating margin, EBITDA margin, and adjusted EBITDA margin are computed by dividing income from operations, adjusted income from operations, EBITDA, and adjusted EBITDA, respectively, by total operating revenues for each of the periods indicated.


We present adjusted income from operations and adjusted EBITDA because we believe it assists 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.

Adjusted income from operations and adjusted EBITDA have limitations as an analytical tool. Some of these limitations are:

 

  Adjusted income from operations and adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;

 

  Adjusted income from operations and adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs;

 

  Adjusted income from operations and adjusted EBITDA do 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 adjusted EBITDA does not reflect any cash requirements for such replacements;

 

  Adjusted income from operations and adjusted EBITDA do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and

 

  Other companies in our industry may calculate adjusted income from operations and adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, adjusted income from operations and adjusted EBITDA 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 using adjusted income from operations and adjusted EBITDA only supplementally.