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CST: 17/07/2019 22:06:23   

Saia Reports Record Fourth Quarter and Full Year Results

163 Days ago

JOHNS CREEK, Ga., Feb. 04, 2019 (GLOBE NEWSWIRE) -- Saia, Inc. (NASDAQ: SAIA), a leading transportation provider offering multi-regional less-than-truckload (LTL), non-asset truckload, expedited and logistics services, today reported fourth quarter and year-end 2018 financial results.

Fourth quarter 2018 revenue and operating income increased 12.9% and 45.4%, respectively, compared to the fourth quarter of 2017.  Diluted earnings per share in the quarter were $0.97 compared to $1.82 in the fourth quarter 2017.  Fourth quarter 2017 adjusted diluted earnings per share1 were $0.53.

For the full year 2018, revenue and operating income rose 17.7% and 49.1%, respectively.  Annual diluted earnings per share in 2018 were $3.99 compared to $3.49 in 2017.  Full year adjusted diluted earnings per share1 were $2.19 in 2017.

During the fourth quarter of 2017, the Company recorded a reduction in deferred income tax liability that was required as a result of the passage of the Tax Cuts and Jobs Act.  The 2017 adjusted EPS for the fourth quarter and full year excludes the gain associated with the reduction of this liability.

Highlights from our fourth quarter and full year operating results were as follows:

Fourth Quarter 2018 Compared to Fourth Quarter 2017 Results

  • Revenues were $407 million, a 12.9% increase
  • Operating income was $33.3 million, a 45.4% increase
  • Operating ratio improved by 180 basis points to 91.8
  • LTL shipments per workday decreased 0.2%
  • LTL tonnage per workday decreased 0.6%
  • LTL revenue per hundredweight increased 12.0%
  • LTL revenue per shipment rose 11.6% to $234.33

Full Year 2018 Results Compared to Full Year 2017 Results

  • Revenue rose 17.7% to a record $1.65 billion
  • Operating income was another record at $141.2 million, a 49.1% increase
  • Operating ratio improved 180 basis points to a record 91.5 from 93.3
  • LTL shipments per workday increased 4.4%
  • LTL tonnage per workday increased 6.6%
  • LTL revenue per hundredweight increased 10.2%
  • LTL revenue per shipment 12.5% to $227.08

“2018 was a record year for our company and our value proposition was supported by our consistent approach to pricing for profitability and supplemented by our growing presence in new markets in the Northeast”, said Saia Chief Executive Officer, Rick O’Dell.  “Business to and from the Northeast is running at an annualized rate of approximately $150 million exiting 2018 and we have four to six new terminal openings scheduled in new Northeastern markets in 2019”, O’Dell continued.

“Approximately 75% of the freight moves we are handling in the Northeast are for customers who were already using Saia in other markets and understand the value proposition we offer.  In the fourth quarter our on-time service metric averaged 98% and our cargo claims ratio was .75%”, stated O’Dell.

“Our yield in the fourth quarter improved by 12.0%, marking the 34th consecutive quarter of year-over-year improvement.  As we are able to offer a more complete coverage map to customers, we add value to their supply chain and we are in a good position to grow with the customer”, concluded O’Dell. 

Financial Position and Capital Expenditures

Total debt was $122.9 million at December 31, 2018 and inclusive of the cash on-hand, net debt to total capital was 14.8%.  This compares to total debt of $132.9 million and net debt to total capital of 18.0% at December 31, 2017.

Net capital expenditures in 2018 were $251.7 million including equipment acquired with capital leases.  This compares to $217.0 million in net capital expenditures in 2017.  In 2019, we anticipate net capital expenditures of approximately $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 888-394-8218 or 323-794-2588 referencing conference ID #9174082.  Callers should dial in five to ten minutes in advance of the conference call.  This call will be webcast live via the Company web site at www.saiacorp.com.  A replay of the call will be offered two hours after the completion of the call through March 4, 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 160 terminals in 41 states.  For more information on Saia, Inc. visit the Investor Relations section at www.saiacorp.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, including their goodwill; (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, regulations of 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) cost and availability of insurance coverage, including the possibility the Company may be required to pay additional premiums under its auto liability policy; (23) increased costs of healthcare and prescription drugs, including as a result of healthcare reform legislation; (24) social media risks; (25) disruption in or failure of the Company’s technology including services essential to operations of the Company and/or cyber security risk; (26) failure to successfully execute the strategy to expand the Company’s service geography into the Northeastern United States; and (27) 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.  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.

FOOTNOTE

1 Non-GAAP Financial Disclosure and Reconciliation:
The Tax Cuts and Jobs Act (the “Tax Act”) was enacted on December 22, 2017 and lowers U.S. corporate income tax rates as of January 1, 2018, among other changes.  The impact of the Tax Act for 2017 was a reduction of deferred income tax liability due to the effects of the remeasurement of deferred tax assets at lower enacted corporate tax rates.  Management believes that presenting the Company’s 2017 results excluding the Tax Act is meaningful as excluding this item increases the comparability of period-to-period results.  Diluted earnings per common share excluding the impact of the Tax Act for 2017 is a non-GAAP financial measure.  Non-GAAP financial measures do not have definitions under GAAP and may be defined differently by and not be comparable to similar non-GAAP measures used by other companies.  The table below presents the calculation of diluted earnings per common share, excluding the impact of the Tax Act from 2017:

Saia, Inc. and Subsidiaries
Non-GAAP Diluted Earnings Per Share and Reconciliation to GAAP
For the Quarters and Years Ended December 31, 2018 and 2017
(Unaudited)
         
    Fourth Quarter   Years
    2018   2017   2018   2017
Diluted earnings per share
  $ 0.97   $ 1.82   $ 3.99   $ 3.49 
Less: Diluted earnings per share impact of Tax Cuts and Jobs Act     (1.29 )  -    (1.30)
Adjusted diluted earnings per share
  $ 0.97   $ 0.53   $ 3.99   $ 2.19 
                         


 

Saia, Inc. and Subsidiaries  
Condensed Consolidated Balance Sheets  
(Amounts in thousands)  
(Unaudited)  
           
    December 31,
2018
  December 31,
2017
 
ASSETS          
           
CURRENT ASSETS:          
Cash and cash equivalents   $   2,194     $   4,720    
Accounts receivable, net (1)       181,612         170,278    
Prepaid expenses and other       29,567         28,251    
  Total current assets       213,373         203,249    
           
PROPERTY AND EQUIPMENT:          
Cost       1,521,341         1,289,994    
Less: accumulated depreciation       628,283         554,214    
  Net property and equipment       893,058         735,780    
 OTHER ASSETS       27,312         28,286    
  Total assets   $   1,133,743     $   967,315    
           
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
CURRENT LIABILITIES:          
Accounts payable (1)   $   78,994     $   57,438    
Wages and employees' benefits       48,116         39,748    
Other current liabilities       64,118         55,657    
Current portion of long-term debt       18,082         14,083    
  Total current liabilities       209,310         166,926    
           
OTHER LIABILITIES:          
Long-term debt, less current portion       104,777         118,833    
Deferred income taxes       86,893         59,423    
Claims, insurance and other       36,899         39,639    
  Total other liabilities       228,569         217,895    
           
STOCKHOLDERS' EQUITY:          
Common stock       26         26    
Additional paid-in capital       254,738         246,454    
Deferred compensation trust       (3,381 )       (3,486 )  
Retained earnings (1)       444,481         339,500    
  Total stockholders' equity       695,864         582,494    
  Total liabilities and stockholders' equity    $   1,133,743     $   967,315    
           
(1) - These accounts have been retrospectively adjusted for the January 1, 2018 adoption of the Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers.  
           

 

Saia, Inc. and Subsidiaries  
Consolidated Statements of Operations  
For the Quarters and Years Ended December 31, 2018 and 2017  
(Amounts in thousands, except per share data)  
(Unaudited)  
           
    Fourth Quarter   Years  
    2018   2017 (1)   2018   2017 (1)  
OPERATING REVENUE   $   406,750   $   360,196     $   1,653,849     $   1,404,703    
                   
OPERATING EXPENSES:                  
Salaries, wages and employees' benefits        216,557     194,579         872,722       766,790    
Purchased transportation       28,659     28,185         123,904       107,702    
Fuel, operating expenses and supplies       79,818     71,329         325,000       268,090    
Operating taxes and licenses        12,779     11,242         50,089       43,330    
Claims and insurance        8,339     9,152         38,425       37,162    
Depreciation and amortization       27,188     22,495         102,153       87,102    
Loss (gain) from property disposals, net       74     286         379       (183 )  
  Total operating expenses        373,414       337,268         1,512,672         1,309,993    
                   
OPERATING INCOME        33,336       22,928         141,177         94,710    
                   
NONOPERATING EXPENSES (INCOME):                  
Interest expense       1,328       1,289         5,418         5,051    
Other, net       310       (149 )       (74 )       (92 )  
  Nonoperating expenses, net       1,638       1,140         5,344         4,959    
                   
INCOME BEFORE INCOME TAXES       31,698       21,788         135,833         89,751    
Income tax expense (benefit)       6,318       (26,001 )       30,852         (1,378 )  
NET INCOME    $   25,380   $   47,789     $   104,981     $   91,129    
                   
Average common shares outstanding - basic       25,791       25,589         25,762         25,518    
Average common shares outstanding - diluted       26,289       26,189         26,291         26,086    
                   
Basic earnings per share   $   0.98   $   1.87     $   4.08     $   3.57    
Diluted earnings per share   $   0.97   $   1.82     $   3.99     $   3.49    
                   
(1) - Fourth quarter and year ended 2017 amounts have been retrospectively adjusted for the January 1, 2018 adoption of the FASB ASU 2014-09, Revenue from Contracts with Customers.  
   

 

Saia, Inc. and Subsidiaries  
Condensed Consolidated Statements of Cash Flows  
For the Years Ended December 31, 2018 and 2017  
(Amounts in thousands)  
(Unaudited)  
    Years  
      2018       2017    
OPERATING ACTIVITIES:          
Net cash provided by operating activities   $   256,436     $   157,846    
Net cash provided by operating activities       256,436         157,846    
           
INVESTING ACTIVITIES:          
Acquisition of property and equipment       (223,672 )       (186,696 )  
Proceeds from disposal of property and equipment       1,088         5,172    
Net cash used in investing activities       (222,584 )       (181,524 )  
           
FINANCING ACTIVITIES:          
Repayment of long-term debt       –         (7,143 )  
Borrowing (repayment) of revolving credit agreement, net       (23,000 )       43,000    
Proceeds from stock option exercises       4,165         4,480    
Shares withheld for taxes       (1,396 )       (1,250 )  
Other financing activity       (16,147 )       (12,228 )  
  Net cash provided by (used in) financing activities       (36,378 )       26,859    
           
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS       (2,526 )       3,181    
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR       4,720         1,539    
CASH AND CASH EQUIVALENTS, END OF YEAR   $   2,194     $   4,720    
           
NON-CASH ITEMS:          
Equipment financed with capital leases   $   29,090     $   35,483    
           

 

Saia, Inc. and Subsidiaries  
Financial   Information  
For the Quarters Ended December 31, 2018 and 2017  
(Unaudited)  
                           
                Fourth Quarter      
    Fourth Quarter    %    Amount/Workday    %   
      2018       2017     Change   2018   2017   Change  
Workdays             62   61      
Operating ratio (1)   91.8 %     93.6 %                  
LTL tonnage (2)   1,115       1,104       1.0     17.99   18.10     (0.6 )  
LTL shipments (2)   1,687       1,663       1.4     27.22   27.27     (0.2 )  
LTL revenue/cwt. $   17.72     $   15.82       12.0                
LTL revenue/shipment $   234.33     $   210.02       11.6                
LTL pounds/shipment   1,322       1,327       (0.4 )              
LTL length of haul (3)   837       828       1.1                
                           
 (1 ) Fourth quarter 2017 operating ratio has been retrospectively adjusted for the January 1, 2018 adoption of the FASB ASU 2014-09, Revenue from Contracts with Customers.  
                           
(2 ) In thousands.                        
                           
(3 ) 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.  2017 LTL operating statistics have been restated to reflect this presentation.  
     

 

Saia, Inc. and Subsidiaries  
Financial   Information  
For the Years Ended December 31, 2018 and 2017  
(Unaudited)  
                           
                Year Over Year      
    Year Over Year    %    Amount/Workday    %   
      2018       2017     Change   2018   2017   Change  
Workdays             253   252      
Operating ratio (1)   91.5 %     93.3 %                  
LTL tonnage (2)   4,801       4,485       7.0   18.97   17.80     6.6  
LTL shipments (2)   7,103       6,775       4.9   28.08   26.88     4.4  
LTL revenue/cwt. $   16.80     $   15.24       10.2              
LTL revenue/shipment $   227.08     $   201.81       12.5              
LTL pounds/shipment   1,352       1,324       2.1              
LTL length of haul (3)   837       811       3.2              
                           
 (1 ) 2017 operating ratio has been retrospectively adjusted for the January 1, 2018 adoption of the FASB ASU 2014-09, Revenue from Contracts with Customers.   
                           
(2 ) In thousands.  
                           
(3 ) In miles.                        


CONTACT:
Saia, Inc.

Doug Col
dcol@saia.com
678.542.3910

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