Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries J.B. Hunt Transport Services, Inc. Reports U.S. GAAP Revenues, Net Earnings and Earnings Per Share for the Second Quarter 2023 By: J.B. Hunt Transport Services, Inc. via Business Wire July 18, 2023 at 16:05 PM EDT Second Quarter 2023 Revenue: $3.13 billion; down 18% Second Quarter 2023 Operating Income: $270.7 million; down 23% Second Quarter 2023 EPS: $1.81 vs. $2.42; down 25% J.B. Hunt Transport Services, Inc. (NASDAQ: JBHT) announced second quarter 2023 U.S. GAAP (United States Generally Accepted Accounting Principles) net earnings of $189.6 million, or diluted earnings per share of $1.81 versus second quarter 2022 net earnings of $255.3 million, or $2.42 per diluted share. Total operating revenue for the current quarter was $3.13 billion, compared with $3.84 billion for the second quarter 2022, a decrease of 18%. The decline in revenue was primarily driven by a decrease in revenue per load of 24% in Integrated Capacity Solutions (ICS), 13% in Intermodal (JBI), and 21% in Truckload (JBT), and a 4% decline in productivity in Dedicated Capacity Solutions®(DCS®), as a result of changes in customer rate, freight mix and lower fuel surcharge revenue. Volume declines of 7% in JBI, 26% in ICS, 4% in DCS, and stop count decline of 24% in Final Mile Services® (FMS) also contributed to the year-overyear decline in revenue, partially offset by a 6% increase in JBT volume. Current quarter total operating revenue, excluding fuel surcharge revenue, decreased 14% versus the comparable quarter 2022. Total freight transactions in the Marketplace for J.B. Hunt 360°® decreased 40% to $336 million in the second quarter 2023 compared to $556 million in the prior year quarter. ICS revenue on the platform decreased 43% to $225 million versus a year ago. JBT and JBI executed $78 million and $33 million, a decrease of 31% and 36%, respectively, of their independent contractor and their third-party dray and power-only capacity through the platform during the quarter. Operating income for the current quarter decreased 23% to $270.7 million versus $353.1 million for the second quarter 2022. Operating income decreased primarily due to lower revenue across all of our business segments, largely driven by a combination of lower volume and customer rates. In addition, second quarter 2023 included a $4 million net loss from the sale of equipment compared to a $3 million net gain in the prior year quarter. On a consolidated basis, operating margin decreased year-over-year as a result of higher professional driver and non-driver wages and benefits and equipment-related and maintenance expenses as a percentage of gross revenue. These items were partially offset by lower rail and truck purchased transportation costs and insurance and claims cost as a percentage of gross revenue. In addition, the prior year quarter included a net $18.4 million pre-tax expense consisting of an increase in casualty claim expenses, offset by a workers' compensation insurance benefit. Net interest expense for the current quarter increased approximately 14% from the second quarter 2022 due to higher effective interest rates as average debt balances were similar for both periods. The effective income tax rate was 26.0% in the current quarter compared to 25.0% in the second quarter 2022. We continue to expect our 2023 annual tax rate to be between 24.0% and 25.0%. Segment Recast: On January 1, 2023, the Company transferred the majority of JBT's company owned trucking operations to DCS and transferred its less-than-truckload brokerage operations from ICS to FMS. The segment information discussed below adjusts the prior year periods for these operational transfers between segments. Segment Information: Intermodal (JBI) Second Quarter 2023 Segment Revenue: $1.49 billion; down 19% Second Quarter 2023 Operating Income: $142.9 million; down 29% Intermodal volume decreased 7% over the same period in 2022. Eastern network loads decreased 6%, while transcontinental loads decreased 8%. Demand for intermodal capacity continued to be impacted by weaker overall freight activity, particularly import-related freight. Segment gross revenue decreased 19% from the prior-year period, reflecting the 7% decrease in volume and a 13% decrease in gross revenue per load, resulting from changes in the mix of freight, customer rates, and fuel surcharge revenues. Revenue per load excluding fuel surcharge revenue decreased 7% year-over-year. Operating income decreased 29% in the second quarter primarily from lower customer rate and volume, and the resulting impact on absorbing network and equipment costs. JBl's operating margin declined year-overyear as a result of increases in professional driver and non-driver wages and benefits and higher equipmentrelated and maintenance expenses as a percentage of gross revenue. The prior year quarter included $7.7 million of the net pre-tax insurance-related expense in the quarter. During the period, we successfully onboarded 326 new pieces of trailing equipment. We ended the quarter with approximately 116,500 containers and 6,500 power units in the dray fleet. Dedicated Contract Services (DCS) Second Quarter 2023 Segment Revenue: $888 million; down 2% Second Quarter 2023 Operating Income: $113.6 million; up 21% DCS revenue decreased 2% during the current quarter over the same period 2022. Productivity (revenue per truck per week) decreased approximately 4% versus the prior period. Productivity excluding fuel surcharge revenue increased 3% from a year ago driven primarily by increases in contracted indexedbased price escalators. On a net basis, there were 8 fewer revenue producing trucks in the fleet by the end of the quarter compared to the prior-year period, and 97 fewer versus the end of the first quarter 2023. Customer retention rates remain above 98%. Operating income increased 21% from the prior-year quarter primarily from the maturing of new business onboarded over the trailing twelve months. This benefit was partially offset by higher professional driver and non-driver wages and benefits, and equipment-related and maintenance expenses. The prior year quarter included $1.6 million of the net pre-tax insurance-related expense in the quarter. Integrated Capacity Solutions (ICS) Second Quarter 2023 Segment Revenue: $344 million; down 43% Second Quarter 2023 Operating (Loss)/Income: $(4.4) million; vs. $23.2 million in Q2'22 ICS revenue declined 43% during the current quarter versus the second quarter 2022. Overall segment volume decreased 26% versus the prior year period. Revenue per load decreased 24% compared to the second quarter 2022 due to lower contractual and transactional rates and changes in customer freight mix. Contractual volume represented approximately 66% of the total load volume and 64% of the total revenue in the current quarter compared to 44% and 47%, respectively, in second quarter 2022. Of the total reported ICS revenue, approximately $225 million was executed through the Marketplace for J.B. Hunt 360 compared to $392 million in second quarter 2022. Operating loss was $4.4 million compared to operating income of $23.2 million in the second quarter 2022. This change was due largely to lower gross profit, partially offset by lower personnel and insurance-related expenses, and reduced technology costs. Gross profit declined 54% as a result of lower volume, revenue and gross profit margins compared to the prior year period. Gross profit margins decreased to 13.0% in the current period versus 16.1% in the prior period. ICS carrier base decreased 7% year-over-year, largely driven by changes to carrier requirements. The prior year quarter included $6.7 million of the net pre-tax insurance-related expense in the quarter. Final Mile Services (FMS) Second Quarter 2023 Segment Revenue: $224 million; down 19% Second Quarter 2023 Operating Income: $14.8 million; up 12% FMS revenue decreased 19% compared to the same period 2022 primarily driven by efforts to improve revenue quality by putting business at risk on contract renewals, and general weakness in demand across many of the industry verticals served. The decline in revenue was partially offset by multiple new customer contracts implemented over the trailing twelve months, as well as improved revenue quality at underperforming accounts. Operating income increased 12% compared to the prior year period primarily from internal efforts to improve revenue quality and managing costs. Higher revenue quality was partially offset by higher equipment-related expenses, technology investments, and inflationary increases in facility rental expenses. The prior year quarter included $0.4 million of the net pre-tax insurance-related expense in the quarter. Truckload (JBT) Second Quarter 2023 Segment Revenue: $192 million; down 16% Second Quarter 2023 Operating Income: $3.8 million; down 81% JBT revenue decreased 16% compared to the same period in the previous year. Revenue excluding fuel surcharge revenue decreased 15% primarily due to a 20% decline in revenue per load excluding fuel surcharge revenue partially offset by a 6% increase in load volume. Total average effective trailer count increased by approximately 3,200 units, or 32%, resulting in strong double-digit growth in volume performance in J.B. Hunt 360box®versus the prior year period. Trailer turns in the quarter were down 20% from the prior period primarily due to freight mix and weaker overall freight demand as compared to the second quarter 2022. JBT operating income decreased 81% to $3.8 million versus the second quarter 2022. The decrease in operating income was primarily driven by the decline in revenue. JBT's operating margin declined yearover-year as a result of maintaining levels of investment to build out the network and expand the technology capabilities of 360box, in addition to higher equipment-related and maintenance expenses as a percentage of gross revenue. JBT continues to leverage the J.B. Hunt 360 platform to grow third-party power capacity and capability for the 360box service offering. The prior year quarter included $2.0 million of the net pre-tax insurance-related expense in the quarter. Cash Flow and Capitalization: At June 30, 2023, we had approximately $1.4 billion outstanding on various debt instruments compared to $1.3 billion at June 30, 2022 and at December 31, 2022. Our net capital expenditures for the six months ended June 30, 2023 approximated $854 million compared to $598 million for the same period 2022. At June 30, 2023, we had cash and cash equivalents of approximately $296 million. Prior to the end of the quarter, we elected to draw funds available to us under our credit facility, before the term portion of the commitments expired to maintain flexibility and maximize our liquidity. In the second quarter 2023, we purchased approximately 315,000 shares of common stock for approximately $53 million. At June 30, 2023, we had approximately $467 million remaining under our share repurchase authorization. Actual shares outstanding at June 30, 2023 approximated 103.3 million. Conference Call Information: The company will hold a conference call today from 4:00-5:00 p.m. CDT to discuss the quarterly earnings. Investors will have the opportunity to listen to the conference call live over the internet by going to investor.jbhunt.com. Please log on 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, an online replay of the earnings call webcast will be available a few hours after the completion of the call. Forward-Looking Statements: This press release may contain forward-looking statements, which are based on information currently available. Actual results may differ materially from those currently anticipated due to a number of factors, including, but not limited to, those discussed in Item 1A of our Annual Report filed on Form 10-K for the year ended December 31, 2022. We assume no obligation to update any forward-looking statement to the extent we become aware that it will not be achieved for any reason. This press release and additional information will be available to interested parties on our website, www.jbhunt.com. About J.B. Hunt J.B. Hunt Transport Services Inc. is on a mission to create the most efficient transportation network in North America. The company's industry-leading solutions and mode-neutral approach generate value for customers by eliminating waste, reducing costs and enhancing supply chain visibility. Powered by one of the largest company-owned fleets in the country with more than 162,000 pieces of trailing equipment and nearly one million accessible trucks through its J.B. Hunt 360°® digital freight marketplace, J.B. Hunt can meet the unique shipping needs of any business, from first mile to final delivery, and every shipment inbetween. Through disciplined investments in its people, technology and capacity, J.B. Hunt is delivering exceptional value and service that enable long-term growth for the company and its stakeholders. J.B. Hunt Transport Services Inc. is a Fortune 500 company, an S&P 500 company and a component of the Dow Jones Transportation Average. Its stock trades on NASDAQ under the ticker symbol JBHT. J.B. Hunt Transport Inc. is a wholly owned subsidiary of JBHT. The company's services include intermodal, dedicated, refrigerated, truckload, less-than-truckload, flatbed, single source, last mile, transload and more. For more information, visit www.jbhunt.com. J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Three Months Ended June 30 2023 2022 % Of % Of Amount Revenue Amount Revenue Operating revenues, excluding fuel surcharge revenues $ 2,707,560 $ 3,159,759 Fuel surcharge revenues 425,063 677,773 Total operating revenues 3,132,623 100.0 % 3,837,532 100.0 % Operating expenses Rents and purchased transportation 1,404,586 44.8 % 1,920,823 50.1 % Salaries, wages and employee benefits 821,876 26.2 % 841,825 21.9 % Fuel and fuel taxes 171,846 5.5 % 265,636 6.9 % Depreciation and amortization 179,972 5.7 % 157,571 4.1 % Operating supplies and expenses 128,949 4.1 % 126,383 3.3 % Insurance and claims 63,893 2.1 % 87,258 2.3 % General and administrative expenses, net of asset dispositions 61,472 2.1 % 59,764 1.6 % Operating taxes and licenses 18,951 0.6 % 16,323 0.4 % Communication and utilities 10,366 0.3 % 8,866 0.2 % Total operating expenses 2,861,911 91.4 % 3,484,449 90.8 % Operating income 270,712 8.6 % 353,083 9.2 % Net interest expense 14,604 0.4 % 12,842 0.3 % Earnings before income taxes 256,108 8.2 % 340,241 8.9 % Income taxes 66,556 2.1 % 84,899 2.2 % Net earnings $ 189,552 6.1 % $ 255,342 6.7 % Average diluted shares outstanding 104,566 105,387 Diluted earnings per share $ 1.81 $ 2.42 J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Six Months Ended June 30 2023 2022 % Of % Of Amount Revenue Amount Revenue Operating revenues, excluding fuel surcharge revenues $ 5,450,070 $ 6,201,976 Fuel surcharge revenues 912,142 1,124,144 Total operating revenues 6,362,212 100.0 % 7,326,120 100.0 % Operating expenses Rents and purchased transportation 2,872,384 45.1 % 3,758,163 51.3 % Salaries, wages and employee benefits 1,646,875 25.9 % 1,605,416 21.9 % Fuel and fuel taxes 367,680 5.8 % 455,102 6.2 % Depreciation and amortization 355,784 5.6 % 306,334 4.2 % Operating supplies and expenses 257,308 4.0 % 233,322 3.2 % Insurance and claims 134,221 2.1 % 133,389 1.8 % General and administrative expenses, net of asset dispositions 121,879 2.0 % 97,209 1.4 % Operating taxes and licenses 37,058 0.6 % 32,073 0.4 % Communication and utilities 20,822 0.3 % 17,735 0.2 % Total operating expenses 5,814,011 91.4 % 6,638,743 90.6 % Operating income 548,201 8.6 % 687,377 9.4 % Net interest expense 29,393 0.4 % 25,429 0.4 % Earnings before income taxes 518,808 8.2 % 661,948 9.0 % Income taxes 131,488 2.1 % 163,282 2.2 % Net earnings $ 387,320 6.1 % $ 498,666 6.8 % Average diluted shares outstanding 104,647 105,729 Diluted earnings per share $ 3.70 $ 4.72 Financial Information By Segment (in thousands) (unaudited) Three Months Ended June 30 2023 2022 % Of % Of Amount Total Amount Total Revenue Intermodal $ 1,489,148 48 % $ 1,832,778 48 % Dedicated 887,593 28 % 903,925 24 % Integrated Capacity Solutions 343,691 11 % 605,606 16 % Final Mile Services 223,939 7 % 274,991 7 % Truckload 191,803 6 % 227,909 5 % Subtotal 3,136,174 100 % 3,845,209 100 % Intersegment eliminations (3,551 ) (0 %) (7,677 ) (0 %) Consolidated revenue $ 3,132,623 100 % $ 3,837,532 100 % Operating income Intermodal $ 142,860 53 % $ 202,529 57 % Dedicated 113,615 42 % 94,141 27 % Integrated Capacity Solutions (4,419 ) (2 %) 23,222 7 % Final Mile Services 14,824 5 % 13,249 4 % Truckload 3,798 2 % 20,024 5 % Other (1) 34 0 % (82 ) (0 %) Operating income $ 270,712 100 % $ 353,083 100 % Six Months Ended June 30 2023 2022 % Of % Of Amount Total Amount Total Revenue Intermodal $ 3,028,707 48 % $ 3,436,164 47 % Dedicated 1,766,735 28 % 1,680,046 23 % Integrated Capacity Solutions 728,465 11 % 1,264,478 17 % Final Mile Services 449,016 7 % 509,963 7 % Truckload 397,665 6 % 457,438 6 % Subtotal 6,370,588 100 % 7,348,089 100 % Intersegment eliminations (8,376 ) (0 %) (21,969 ) (0 %) Consolidated revenue $ 6,362,212 100 % $ 7,326,120 100 % Operating income Intermodal $ 311,518 57 % $ 403,500 59 % Dedicated 216,175 39 % 173,832 25 % Integrated Capacity Solutions (9,791 ) (2 %) 47,415 7 % Final Mile Services 21,444 4 % 13,839 2 % Truckload 8,788 2 % 48,928 7 % Other (1) 67 0 % (137 ) (0 %) Operating income $ 548,201 100 % $ 687,377 100 % (1) Includes corporate support activity Operating Statistics by Segment (unaudited) Three Months Ended June 30 2023 2022 Intermodal Loads 501,681 539,024 Average length of haul 1,655 1,658 Revenue per load $ 2,968 $ 3,400 Average tractors during the period * 6,517 6,562 Tractors (end of period) * 6,491 6,620 Trailing equipment (end of period) 116,481 110,654 Average effective trailing equipment usage 95,815 108,860 Dedicated Loads 1,104,896 1,149,401 Average length of haul 172 167 Revenue per truck per week** $ 5,182 $ 5,380 Average trucks during the period*** 13,236 13,001 Trucks (end of period) *** 13,228 13,236 Trailing equipment (end of period) 29,773 27,108 Average effective trailing equipment usage 31,979 32,099 Integrated Capacity Solutions Loads 194,635 262,213 Revenue per load $ 1,766 $ 2,310 Gross profit margin 13.0% 16.1% Employee count (end of period) 769 1,022 Approximate number of third-party carriers (end of period) 144,600 154,800 Marketplace for J.B. Hunt 360 revenue (millions) $ 225.0 $ 392.1 Final Mile Services Stops 1,141,415 1,501,268 Average trucks during the period*** 1,551 1,873 Truckload Loads 101,402 95,245 Revenue per load $ 1,892 $ 2,393 Average length of haul 659 543 Tractors (end of period) Company-owned 33 165 Independent contractor 2,035 1,850 Total tractors 2,068 2,015 Trailers (end of period) 15,358 12,770 Average effective trailing equipment usage 13,108 9,928 * Includes company-owned and independent contractor tractors ** Using weighted workdays *** Includes company-owned, independent contractor, and customer-owned trucks Operating Statistics by Segment (unaudited) Six Months Ended June 30 2023 2022 Intermodal Loads 987,772 1,049,760 Average length of haul 1,653 1,665 Revenue per load $ 3,066 $ 3,273 Average tractors during the period * 6,558 6,412 Tractors (end of period) * 6,491 6,620 Trailing equipment (end of period) 116,481 110,654 Average effective trailing equipment usage 96,061 107,372 Dedicated Loads 2,182,268 2,220,631 Average length of haul 172 167 Revenue per truck per week** $ 5,120 $ 5,108 Average trucks during the period*** 13,353 12,782 Trucks (end of period) *** 13,228 13,236 Trailing equipment (end of period) 29,773 27,108 Average effective trailing equipment usage 31,679 32,274 Integrated Capacity Solutions Loads 397,166 534,040 Revenue per load $ 1,834 $ 2,368 Gross profit margin 13.3% 14.4% Employee count (end of period) 769 1,022 Approximate number of third-party carriers (end of period) 144,600 154,800 Marketplace for J.B. Hunt 360 revenue (millions) $ 475.6 $ 822.4 Final Mile Services Stops 2,303,553 2,902,982 Average trucks during the period*** 1,601 1,761 Truckload Loads 200,186 186,384 Revenue per load $ 1,986 $ 2,454 Average length of haul 650 548 Tractors (end of period) Company-owned 33 165 Independent contractor 2,035 1,850 Total tractors 2,068 2,015 Trailers (end of period) 15,358 12,770 Average effective trailing equipment usage 13,118 9,452 * Includes company-owned and independent contractor tractors ** Using weighted workdays *** Includes company-owned, independent contractor, and customer-owned trucks J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Balance Sheets (in thousands) (unaudited) June 30, 2023 December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 295,929 $ 51,927 Accounts Receivable, net 1,286,244 1,528,075 Prepaid expenses and other 555,407 631,776 Total current assets 2,137,580 2,211,778 Property and equipment 8,424,327 7,999,480 Less accumulated depreciation 2,940,246 3,019,663 Net property and equipment 5,484,081 4,979,817 Other assets, net 626,071 594,987 $ 8,247,732 $ 7,786,582 LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities: Current debt $ 249,844 $ - Trade accounts payable 767,428 798,776 Claims accruals 492,222 452,149 Accrued payroll 119,898 188,252 Other accrued expenses 139,132 129,054 Total current liabilities 1,768,524 1,568,231 Long-term debt 1,195,309 1,261,738 Other long-term liabilities 393,181 369,314 Deferred income taxes 978,795 920,531 Stockholders' equity 3,911,923 3,666,768 $ 8,247,732 $ 7,786,582 Supplemental Data (unaudited) June 30, 2023 December 31, 2022 Actual shares outstanding at end of period (000) 103,345 103,743 Book value per actual share outstanding at end of period $ 37.85 $ 35.34 Six Months Ended June 30 2023 2022 Net cash provided by operating activities (000) $ 1,097,290 $ 784,527 Net capital expenditures (000) $ 853,778 $ 598,094 View source version on businesswire.com: https://www.businesswire.com/news/home/20230718683431/en/Contacts Brad Delco Senior Vice President - Finance (479) 820-2723 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
J.B. Hunt Transport Services, Inc. Reports U.S. GAAP Revenues, Net Earnings and Earnings Per Share for the Second Quarter 2023 By: J.B. Hunt Transport Services, Inc. via Business Wire July 18, 2023 at 16:05 PM EDT Second Quarter 2023 Revenue: $3.13 billion; down 18% Second Quarter 2023 Operating Income: $270.7 million; down 23% Second Quarter 2023 EPS: $1.81 vs. $2.42; down 25% J.B. Hunt Transport Services, Inc. (NASDAQ: JBHT) announced second quarter 2023 U.S. GAAP (United States Generally Accepted Accounting Principles) net earnings of $189.6 million, or diluted earnings per share of $1.81 versus second quarter 2022 net earnings of $255.3 million, or $2.42 per diluted share. Total operating revenue for the current quarter was $3.13 billion, compared with $3.84 billion for the second quarter 2022, a decrease of 18%. The decline in revenue was primarily driven by a decrease in revenue per load of 24% in Integrated Capacity Solutions (ICS), 13% in Intermodal (JBI), and 21% in Truckload (JBT), and a 4% decline in productivity in Dedicated Capacity Solutions®(DCS®), as a result of changes in customer rate, freight mix and lower fuel surcharge revenue. Volume declines of 7% in JBI, 26% in ICS, 4% in DCS, and stop count decline of 24% in Final Mile Services® (FMS) also contributed to the year-overyear decline in revenue, partially offset by a 6% increase in JBT volume. Current quarter total operating revenue, excluding fuel surcharge revenue, decreased 14% versus the comparable quarter 2022. Total freight transactions in the Marketplace for J.B. Hunt 360°® decreased 40% to $336 million in the second quarter 2023 compared to $556 million in the prior year quarter. ICS revenue on the platform decreased 43% to $225 million versus a year ago. JBT and JBI executed $78 million and $33 million, a decrease of 31% and 36%, respectively, of their independent contractor and their third-party dray and power-only capacity through the platform during the quarter. Operating income for the current quarter decreased 23% to $270.7 million versus $353.1 million for the second quarter 2022. Operating income decreased primarily due to lower revenue across all of our business segments, largely driven by a combination of lower volume and customer rates. In addition, second quarter 2023 included a $4 million net loss from the sale of equipment compared to a $3 million net gain in the prior year quarter. On a consolidated basis, operating margin decreased year-over-year as a result of higher professional driver and non-driver wages and benefits and equipment-related and maintenance expenses as a percentage of gross revenue. These items were partially offset by lower rail and truck purchased transportation costs and insurance and claims cost as a percentage of gross revenue. In addition, the prior year quarter included a net $18.4 million pre-tax expense consisting of an increase in casualty claim expenses, offset by a workers' compensation insurance benefit. Net interest expense for the current quarter increased approximately 14% from the second quarter 2022 due to higher effective interest rates as average debt balances were similar for both periods. The effective income tax rate was 26.0% in the current quarter compared to 25.0% in the second quarter 2022. We continue to expect our 2023 annual tax rate to be between 24.0% and 25.0%. Segment Recast: On January 1, 2023, the Company transferred the majority of JBT's company owned trucking operations to DCS and transferred its less-than-truckload brokerage operations from ICS to FMS. The segment information discussed below adjusts the prior year periods for these operational transfers between segments. Segment Information: Intermodal (JBI) Second Quarter 2023 Segment Revenue: $1.49 billion; down 19% Second Quarter 2023 Operating Income: $142.9 million; down 29% Intermodal volume decreased 7% over the same period in 2022. Eastern network loads decreased 6%, while transcontinental loads decreased 8%. Demand for intermodal capacity continued to be impacted by weaker overall freight activity, particularly import-related freight. Segment gross revenue decreased 19% from the prior-year period, reflecting the 7% decrease in volume and a 13% decrease in gross revenue per load, resulting from changes in the mix of freight, customer rates, and fuel surcharge revenues. Revenue per load excluding fuel surcharge revenue decreased 7% year-over-year. Operating income decreased 29% in the second quarter primarily from lower customer rate and volume, and the resulting impact on absorbing network and equipment costs. JBl's operating margin declined year-overyear as a result of increases in professional driver and non-driver wages and benefits and higher equipmentrelated and maintenance expenses as a percentage of gross revenue. The prior year quarter included $7.7 million of the net pre-tax insurance-related expense in the quarter. During the period, we successfully onboarded 326 new pieces of trailing equipment. We ended the quarter with approximately 116,500 containers and 6,500 power units in the dray fleet. Dedicated Contract Services (DCS) Second Quarter 2023 Segment Revenue: $888 million; down 2% Second Quarter 2023 Operating Income: $113.6 million; up 21% DCS revenue decreased 2% during the current quarter over the same period 2022. Productivity (revenue per truck per week) decreased approximately 4% versus the prior period. Productivity excluding fuel surcharge revenue increased 3% from a year ago driven primarily by increases in contracted indexedbased price escalators. On a net basis, there were 8 fewer revenue producing trucks in the fleet by the end of the quarter compared to the prior-year period, and 97 fewer versus the end of the first quarter 2023. Customer retention rates remain above 98%. Operating income increased 21% from the prior-year quarter primarily from the maturing of new business onboarded over the trailing twelve months. This benefit was partially offset by higher professional driver and non-driver wages and benefits, and equipment-related and maintenance expenses. The prior year quarter included $1.6 million of the net pre-tax insurance-related expense in the quarter. Integrated Capacity Solutions (ICS) Second Quarter 2023 Segment Revenue: $344 million; down 43% Second Quarter 2023 Operating (Loss)/Income: $(4.4) million; vs. $23.2 million in Q2'22 ICS revenue declined 43% during the current quarter versus the second quarter 2022. Overall segment volume decreased 26% versus the prior year period. Revenue per load decreased 24% compared to the second quarter 2022 due to lower contractual and transactional rates and changes in customer freight mix. Contractual volume represented approximately 66% of the total load volume and 64% of the total revenue in the current quarter compared to 44% and 47%, respectively, in second quarter 2022. Of the total reported ICS revenue, approximately $225 million was executed through the Marketplace for J.B. Hunt 360 compared to $392 million in second quarter 2022. Operating loss was $4.4 million compared to operating income of $23.2 million in the second quarter 2022. This change was due largely to lower gross profit, partially offset by lower personnel and insurance-related expenses, and reduced technology costs. Gross profit declined 54% as a result of lower volume, revenue and gross profit margins compared to the prior year period. Gross profit margins decreased to 13.0% in the current period versus 16.1% in the prior period. ICS carrier base decreased 7% year-over-year, largely driven by changes to carrier requirements. The prior year quarter included $6.7 million of the net pre-tax insurance-related expense in the quarter. Final Mile Services (FMS) Second Quarter 2023 Segment Revenue: $224 million; down 19% Second Quarter 2023 Operating Income: $14.8 million; up 12% FMS revenue decreased 19% compared to the same period 2022 primarily driven by efforts to improve revenue quality by putting business at risk on contract renewals, and general weakness in demand across many of the industry verticals served. The decline in revenue was partially offset by multiple new customer contracts implemented over the trailing twelve months, as well as improved revenue quality at underperforming accounts. Operating income increased 12% compared to the prior year period primarily from internal efforts to improve revenue quality and managing costs. Higher revenue quality was partially offset by higher equipment-related expenses, technology investments, and inflationary increases in facility rental expenses. The prior year quarter included $0.4 million of the net pre-tax insurance-related expense in the quarter. Truckload (JBT) Second Quarter 2023 Segment Revenue: $192 million; down 16% Second Quarter 2023 Operating Income: $3.8 million; down 81% JBT revenue decreased 16% compared to the same period in the previous year. Revenue excluding fuel surcharge revenue decreased 15% primarily due to a 20% decline in revenue per load excluding fuel surcharge revenue partially offset by a 6% increase in load volume. Total average effective trailer count increased by approximately 3,200 units, or 32%, resulting in strong double-digit growth in volume performance in J.B. Hunt 360box®versus the prior year period. Trailer turns in the quarter were down 20% from the prior period primarily due to freight mix and weaker overall freight demand as compared to the second quarter 2022. JBT operating income decreased 81% to $3.8 million versus the second quarter 2022. The decrease in operating income was primarily driven by the decline in revenue. JBT's operating margin declined yearover-year as a result of maintaining levels of investment to build out the network and expand the technology capabilities of 360box, in addition to higher equipment-related and maintenance expenses as a percentage of gross revenue. JBT continues to leverage the J.B. Hunt 360 platform to grow third-party power capacity and capability for the 360box service offering. The prior year quarter included $2.0 million of the net pre-tax insurance-related expense in the quarter. Cash Flow and Capitalization: At June 30, 2023, we had approximately $1.4 billion outstanding on various debt instruments compared to $1.3 billion at June 30, 2022 and at December 31, 2022. Our net capital expenditures for the six months ended June 30, 2023 approximated $854 million compared to $598 million for the same period 2022. At June 30, 2023, we had cash and cash equivalents of approximately $296 million. Prior to the end of the quarter, we elected to draw funds available to us under our credit facility, before the term portion of the commitments expired to maintain flexibility and maximize our liquidity. In the second quarter 2023, we purchased approximately 315,000 shares of common stock for approximately $53 million. At June 30, 2023, we had approximately $467 million remaining under our share repurchase authorization. Actual shares outstanding at June 30, 2023 approximated 103.3 million. Conference Call Information: The company will hold a conference call today from 4:00-5:00 p.m. CDT to discuss the quarterly earnings. Investors will have the opportunity to listen to the conference call live over the internet by going to investor.jbhunt.com. Please log on 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, an online replay of the earnings call webcast will be available a few hours after the completion of the call. Forward-Looking Statements: This press release may contain forward-looking statements, which are based on information currently available. Actual results may differ materially from those currently anticipated due to a number of factors, including, but not limited to, those discussed in Item 1A of our Annual Report filed on Form 10-K for the year ended December 31, 2022. We assume no obligation to update any forward-looking statement to the extent we become aware that it will not be achieved for any reason. This press release and additional information will be available to interested parties on our website, www.jbhunt.com. About J.B. Hunt J.B. Hunt Transport Services Inc. is on a mission to create the most efficient transportation network in North America. The company's industry-leading solutions and mode-neutral approach generate value for customers by eliminating waste, reducing costs and enhancing supply chain visibility. Powered by one of the largest company-owned fleets in the country with more than 162,000 pieces of trailing equipment and nearly one million accessible trucks through its J.B. Hunt 360°® digital freight marketplace, J.B. Hunt can meet the unique shipping needs of any business, from first mile to final delivery, and every shipment inbetween. Through disciplined investments in its people, technology and capacity, J.B. Hunt is delivering exceptional value and service that enable long-term growth for the company and its stakeholders. J.B. Hunt Transport Services Inc. is a Fortune 500 company, an S&P 500 company and a component of the Dow Jones Transportation Average. Its stock trades on NASDAQ under the ticker symbol JBHT. J.B. Hunt Transport Inc. is a wholly owned subsidiary of JBHT. The company's services include intermodal, dedicated, refrigerated, truckload, less-than-truckload, flatbed, single source, last mile, transload and more. For more information, visit www.jbhunt.com. J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Three Months Ended June 30 2023 2022 % Of % Of Amount Revenue Amount Revenue Operating revenues, excluding fuel surcharge revenues $ 2,707,560 $ 3,159,759 Fuel surcharge revenues 425,063 677,773 Total operating revenues 3,132,623 100.0 % 3,837,532 100.0 % Operating expenses Rents and purchased transportation 1,404,586 44.8 % 1,920,823 50.1 % Salaries, wages and employee benefits 821,876 26.2 % 841,825 21.9 % Fuel and fuel taxes 171,846 5.5 % 265,636 6.9 % Depreciation and amortization 179,972 5.7 % 157,571 4.1 % Operating supplies and expenses 128,949 4.1 % 126,383 3.3 % Insurance and claims 63,893 2.1 % 87,258 2.3 % General and administrative expenses, net of asset dispositions 61,472 2.1 % 59,764 1.6 % Operating taxes and licenses 18,951 0.6 % 16,323 0.4 % Communication and utilities 10,366 0.3 % 8,866 0.2 % Total operating expenses 2,861,911 91.4 % 3,484,449 90.8 % Operating income 270,712 8.6 % 353,083 9.2 % Net interest expense 14,604 0.4 % 12,842 0.3 % Earnings before income taxes 256,108 8.2 % 340,241 8.9 % Income taxes 66,556 2.1 % 84,899 2.2 % Net earnings $ 189,552 6.1 % $ 255,342 6.7 % Average diluted shares outstanding 104,566 105,387 Diluted earnings per share $ 1.81 $ 2.42 J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Six Months Ended June 30 2023 2022 % Of % Of Amount Revenue Amount Revenue Operating revenues, excluding fuel surcharge revenues $ 5,450,070 $ 6,201,976 Fuel surcharge revenues 912,142 1,124,144 Total operating revenues 6,362,212 100.0 % 7,326,120 100.0 % Operating expenses Rents and purchased transportation 2,872,384 45.1 % 3,758,163 51.3 % Salaries, wages and employee benefits 1,646,875 25.9 % 1,605,416 21.9 % Fuel and fuel taxes 367,680 5.8 % 455,102 6.2 % Depreciation and amortization 355,784 5.6 % 306,334 4.2 % Operating supplies and expenses 257,308 4.0 % 233,322 3.2 % Insurance and claims 134,221 2.1 % 133,389 1.8 % General and administrative expenses, net of asset dispositions 121,879 2.0 % 97,209 1.4 % Operating taxes and licenses 37,058 0.6 % 32,073 0.4 % Communication and utilities 20,822 0.3 % 17,735 0.2 % Total operating expenses 5,814,011 91.4 % 6,638,743 90.6 % Operating income 548,201 8.6 % 687,377 9.4 % Net interest expense 29,393 0.4 % 25,429 0.4 % Earnings before income taxes 518,808 8.2 % 661,948 9.0 % Income taxes 131,488 2.1 % 163,282 2.2 % Net earnings $ 387,320 6.1 % $ 498,666 6.8 % Average diluted shares outstanding 104,647 105,729 Diluted earnings per share $ 3.70 $ 4.72 Financial Information By Segment (in thousands) (unaudited) Three Months Ended June 30 2023 2022 % Of % Of Amount Total Amount Total Revenue Intermodal $ 1,489,148 48 % $ 1,832,778 48 % Dedicated 887,593 28 % 903,925 24 % Integrated Capacity Solutions 343,691 11 % 605,606 16 % Final Mile Services 223,939 7 % 274,991 7 % Truckload 191,803 6 % 227,909 5 % Subtotal 3,136,174 100 % 3,845,209 100 % Intersegment eliminations (3,551 ) (0 %) (7,677 ) (0 %) Consolidated revenue $ 3,132,623 100 % $ 3,837,532 100 % Operating income Intermodal $ 142,860 53 % $ 202,529 57 % Dedicated 113,615 42 % 94,141 27 % Integrated Capacity Solutions (4,419 ) (2 %) 23,222 7 % Final Mile Services 14,824 5 % 13,249 4 % Truckload 3,798 2 % 20,024 5 % Other (1) 34 0 % (82 ) (0 %) Operating income $ 270,712 100 % $ 353,083 100 % Six Months Ended June 30 2023 2022 % Of % Of Amount Total Amount Total Revenue Intermodal $ 3,028,707 48 % $ 3,436,164 47 % Dedicated 1,766,735 28 % 1,680,046 23 % Integrated Capacity Solutions 728,465 11 % 1,264,478 17 % Final Mile Services 449,016 7 % 509,963 7 % Truckload 397,665 6 % 457,438 6 % Subtotal 6,370,588 100 % 7,348,089 100 % Intersegment eliminations (8,376 ) (0 %) (21,969 ) (0 %) Consolidated revenue $ 6,362,212 100 % $ 7,326,120 100 % Operating income Intermodal $ 311,518 57 % $ 403,500 59 % Dedicated 216,175 39 % 173,832 25 % Integrated Capacity Solutions (9,791 ) (2 %) 47,415 7 % Final Mile Services 21,444 4 % 13,839 2 % Truckload 8,788 2 % 48,928 7 % Other (1) 67 0 % (137 ) (0 %) Operating income $ 548,201 100 % $ 687,377 100 % (1) Includes corporate support activity Operating Statistics by Segment (unaudited) Three Months Ended June 30 2023 2022 Intermodal Loads 501,681 539,024 Average length of haul 1,655 1,658 Revenue per load $ 2,968 $ 3,400 Average tractors during the period * 6,517 6,562 Tractors (end of period) * 6,491 6,620 Trailing equipment (end of period) 116,481 110,654 Average effective trailing equipment usage 95,815 108,860 Dedicated Loads 1,104,896 1,149,401 Average length of haul 172 167 Revenue per truck per week** $ 5,182 $ 5,380 Average trucks during the period*** 13,236 13,001 Trucks (end of period) *** 13,228 13,236 Trailing equipment (end of period) 29,773 27,108 Average effective trailing equipment usage 31,979 32,099 Integrated Capacity Solutions Loads 194,635 262,213 Revenue per load $ 1,766 $ 2,310 Gross profit margin 13.0% 16.1% Employee count (end of period) 769 1,022 Approximate number of third-party carriers (end of period) 144,600 154,800 Marketplace for J.B. Hunt 360 revenue (millions) $ 225.0 $ 392.1 Final Mile Services Stops 1,141,415 1,501,268 Average trucks during the period*** 1,551 1,873 Truckload Loads 101,402 95,245 Revenue per load $ 1,892 $ 2,393 Average length of haul 659 543 Tractors (end of period) Company-owned 33 165 Independent contractor 2,035 1,850 Total tractors 2,068 2,015 Trailers (end of period) 15,358 12,770 Average effective trailing equipment usage 13,108 9,928 * Includes company-owned and independent contractor tractors ** Using weighted workdays *** Includes company-owned, independent contractor, and customer-owned trucks Operating Statistics by Segment (unaudited) Six Months Ended June 30 2023 2022 Intermodal Loads 987,772 1,049,760 Average length of haul 1,653 1,665 Revenue per load $ 3,066 $ 3,273 Average tractors during the period * 6,558 6,412 Tractors (end of period) * 6,491 6,620 Trailing equipment (end of period) 116,481 110,654 Average effective trailing equipment usage 96,061 107,372 Dedicated Loads 2,182,268 2,220,631 Average length of haul 172 167 Revenue per truck per week** $ 5,120 $ 5,108 Average trucks during the period*** 13,353 12,782 Trucks (end of period) *** 13,228 13,236 Trailing equipment (end of period) 29,773 27,108 Average effective trailing equipment usage 31,679 32,274 Integrated Capacity Solutions Loads 397,166 534,040 Revenue per load $ 1,834 $ 2,368 Gross profit margin 13.3% 14.4% Employee count (end of period) 769 1,022 Approximate number of third-party carriers (end of period) 144,600 154,800 Marketplace for J.B. Hunt 360 revenue (millions) $ 475.6 $ 822.4 Final Mile Services Stops 2,303,553 2,902,982 Average trucks during the period*** 1,601 1,761 Truckload Loads 200,186 186,384 Revenue per load $ 1,986 $ 2,454 Average length of haul 650 548 Tractors (end of period) Company-owned 33 165 Independent contractor 2,035 1,850 Total tractors 2,068 2,015 Trailers (end of period) 15,358 12,770 Average effective trailing equipment usage 13,118 9,452 * Includes company-owned and independent contractor tractors ** Using weighted workdays *** Includes company-owned, independent contractor, and customer-owned trucks J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Balance Sheets (in thousands) (unaudited) June 30, 2023 December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 295,929 $ 51,927 Accounts Receivable, net 1,286,244 1,528,075 Prepaid expenses and other 555,407 631,776 Total current assets 2,137,580 2,211,778 Property and equipment 8,424,327 7,999,480 Less accumulated depreciation 2,940,246 3,019,663 Net property and equipment 5,484,081 4,979,817 Other assets, net 626,071 594,987 $ 8,247,732 $ 7,786,582 LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities: Current debt $ 249,844 $ - Trade accounts payable 767,428 798,776 Claims accruals 492,222 452,149 Accrued payroll 119,898 188,252 Other accrued expenses 139,132 129,054 Total current liabilities 1,768,524 1,568,231 Long-term debt 1,195,309 1,261,738 Other long-term liabilities 393,181 369,314 Deferred income taxes 978,795 920,531 Stockholders' equity 3,911,923 3,666,768 $ 8,247,732 $ 7,786,582 Supplemental Data (unaudited) June 30, 2023 December 31, 2022 Actual shares outstanding at end of period (000) 103,345 103,743 Book value per actual share outstanding at end of period $ 37.85 $ 35.34 Six Months Ended June 30 2023 2022 Net cash provided by operating activities (000) $ 1,097,290 $ 784,527 Net capital expenditures (000) $ 853,778 $ 598,094 View source version on businesswire.com: https://www.businesswire.com/news/home/20230718683431/en/Contacts Brad Delco Senior Vice President - Finance (479) 820-2723
Second Quarter 2023 Revenue: $3.13 billion; down 18% Second Quarter 2023 Operating Income: $270.7 million; down 23% Second Quarter 2023 EPS: $1.81 vs. $2.42; down 25%
J.B. Hunt Transport Services, Inc. (NASDAQ: JBHT) announced second quarter 2023 U.S. GAAP (United States Generally Accepted Accounting Principles) net earnings of $189.6 million, or diluted earnings per share of $1.81 versus second quarter 2022 net earnings of $255.3 million, or $2.42 per diluted share. Total operating revenue for the current quarter was $3.13 billion, compared with $3.84 billion for the second quarter 2022, a decrease of 18%. The decline in revenue was primarily driven by a decrease in revenue per load of 24% in Integrated Capacity Solutions (ICS), 13% in Intermodal (JBI), and 21% in Truckload (JBT), and a 4% decline in productivity in Dedicated Capacity Solutions®(DCS®), as a result of changes in customer rate, freight mix and lower fuel surcharge revenue. Volume declines of 7% in JBI, 26% in ICS, 4% in DCS, and stop count decline of 24% in Final Mile Services® (FMS) also contributed to the year-overyear decline in revenue, partially offset by a 6% increase in JBT volume. Current quarter total operating revenue, excluding fuel surcharge revenue, decreased 14% versus the comparable quarter 2022. Total freight transactions in the Marketplace for J.B. Hunt 360°® decreased 40% to $336 million in the second quarter 2023 compared to $556 million in the prior year quarter. ICS revenue on the platform decreased 43% to $225 million versus a year ago. JBT and JBI executed $78 million and $33 million, a decrease of 31% and 36%, respectively, of their independent contractor and their third-party dray and power-only capacity through the platform during the quarter. Operating income for the current quarter decreased 23% to $270.7 million versus $353.1 million for the second quarter 2022. Operating income decreased primarily due to lower revenue across all of our business segments, largely driven by a combination of lower volume and customer rates. In addition, second quarter 2023 included a $4 million net loss from the sale of equipment compared to a $3 million net gain in the prior year quarter. On a consolidated basis, operating margin decreased year-over-year as a result of higher professional driver and non-driver wages and benefits and equipment-related and maintenance expenses as a percentage of gross revenue. These items were partially offset by lower rail and truck purchased transportation costs and insurance and claims cost as a percentage of gross revenue. In addition, the prior year quarter included a net $18.4 million pre-tax expense consisting of an increase in casualty claim expenses, offset by a workers' compensation insurance benefit. Net interest expense for the current quarter increased approximately 14% from the second quarter 2022 due to higher effective interest rates as average debt balances were similar for both periods. The effective income tax rate was 26.0% in the current quarter compared to 25.0% in the second quarter 2022. We continue to expect our 2023 annual tax rate to be between 24.0% and 25.0%. Segment Recast: On January 1, 2023, the Company transferred the majority of JBT's company owned trucking operations to DCS and transferred its less-than-truckload brokerage operations from ICS to FMS. The segment information discussed below adjusts the prior year periods for these operational transfers between segments. Segment Information: Intermodal (JBI) Second Quarter 2023 Segment Revenue: $1.49 billion; down 19% Second Quarter 2023 Operating Income: $142.9 million; down 29% Intermodal volume decreased 7% over the same period in 2022. Eastern network loads decreased 6%, while transcontinental loads decreased 8%. Demand for intermodal capacity continued to be impacted by weaker overall freight activity, particularly import-related freight. Segment gross revenue decreased 19% from the prior-year period, reflecting the 7% decrease in volume and a 13% decrease in gross revenue per load, resulting from changes in the mix of freight, customer rates, and fuel surcharge revenues. Revenue per load excluding fuel surcharge revenue decreased 7% year-over-year. Operating income decreased 29% in the second quarter primarily from lower customer rate and volume, and the resulting impact on absorbing network and equipment costs. JBl's operating margin declined year-overyear as a result of increases in professional driver and non-driver wages and benefits and higher equipmentrelated and maintenance expenses as a percentage of gross revenue. The prior year quarter included $7.7 million of the net pre-tax insurance-related expense in the quarter. During the period, we successfully onboarded 326 new pieces of trailing equipment. We ended the quarter with approximately 116,500 containers and 6,500 power units in the dray fleet. Dedicated Contract Services (DCS) Second Quarter 2023 Segment Revenue: $888 million; down 2% Second Quarter 2023 Operating Income: $113.6 million; up 21% DCS revenue decreased 2% during the current quarter over the same period 2022. Productivity (revenue per truck per week) decreased approximately 4% versus the prior period. Productivity excluding fuel surcharge revenue increased 3% from a year ago driven primarily by increases in contracted indexedbased price escalators. On a net basis, there were 8 fewer revenue producing trucks in the fleet by the end of the quarter compared to the prior-year period, and 97 fewer versus the end of the first quarter 2023. Customer retention rates remain above 98%. Operating income increased 21% from the prior-year quarter primarily from the maturing of new business onboarded over the trailing twelve months. This benefit was partially offset by higher professional driver and non-driver wages and benefits, and equipment-related and maintenance expenses. The prior year quarter included $1.6 million of the net pre-tax insurance-related expense in the quarter. Integrated Capacity Solutions (ICS) Second Quarter 2023 Segment Revenue: $344 million; down 43% Second Quarter 2023 Operating (Loss)/Income: $(4.4) million; vs. $23.2 million in Q2'22 ICS revenue declined 43% during the current quarter versus the second quarter 2022. Overall segment volume decreased 26% versus the prior year period. Revenue per load decreased 24% compared to the second quarter 2022 due to lower contractual and transactional rates and changes in customer freight mix. Contractual volume represented approximately 66% of the total load volume and 64% of the total revenue in the current quarter compared to 44% and 47%, respectively, in second quarter 2022. Of the total reported ICS revenue, approximately $225 million was executed through the Marketplace for J.B. Hunt 360 compared to $392 million in second quarter 2022. Operating loss was $4.4 million compared to operating income of $23.2 million in the second quarter 2022. This change was due largely to lower gross profit, partially offset by lower personnel and insurance-related expenses, and reduced technology costs. Gross profit declined 54% as a result of lower volume, revenue and gross profit margins compared to the prior year period. Gross profit margins decreased to 13.0% in the current period versus 16.1% in the prior period. ICS carrier base decreased 7% year-over-year, largely driven by changes to carrier requirements. The prior year quarter included $6.7 million of the net pre-tax insurance-related expense in the quarter. Final Mile Services (FMS) Second Quarter 2023 Segment Revenue: $224 million; down 19% Second Quarter 2023 Operating Income: $14.8 million; up 12% FMS revenue decreased 19% compared to the same period 2022 primarily driven by efforts to improve revenue quality by putting business at risk on contract renewals, and general weakness in demand across many of the industry verticals served. The decline in revenue was partially offset by multiple new customer contracts implemented over the trailing twelve months, as well as improved revenue quality at underperforming accounts. Operating income increased 12% compared to the prior year period primarily from internal efforts to improve revenue quality and managing costs. Higher revenue quality was partially offset by higher equipment-related expenses, technology investments, and inflationary increases in facility rental expenses. The prior year quarter included $0.4 million of the net pre-tax insurance-related expense in the quarter. Truckload (JBT) Second Quarter 2023 Segment Revenue: $192 million; down 16% Second Quarter 2023 Operating Income: $3.8 million; down 81% JBT revenue decreased 16% compared to the same period in the previous year. Revenue excluding fuel surcharge revenue decreased 15% primarily due to a 20% decline in revenue per load excluding fuel surcharge revenue partially offset by a 6% increase in load volume. Total average effective trailer count increased by approximately 3,200 units, or 32%, resulting in strong double-digit growth in volume performance in J.B. Hunt 360box®versus the prior year period. Trailer turns in the quarter were down 20% from the prior period primarily due to freight mix and weaker overall freight demand as compared to the second quarter 2022. JBT operating income decreased 81% to $3.8 million versus the second quarter 2022. The decrease in operating income was primarily driven by the decline in revenue. JBT's operating margin declined yearover-year as a result of maintaining levels of investment to build out the network and expand the technology capabilities of 360box, in addition to higher equipment-related and maintenance expenses as a percentage of gross revenue. JBT continues to leverage the J.B. Hunt 360 platform to grow third-party power capacity and capability for the 360box service offering. The prior year quarter included $2.0 million of the net pre-tax insurance-related expense in the quarter. Cash Flow and Capitalization: At June 30, 2023, we had approximately $1.4 billion outstanding on various debt instruments compared to $1.3 billion at June 30, 2022 and at December 31, 2022. Our net capital expenditures for the six months ended June 30, 2023 approximated $854 million compared to $598 million for the same period 2022. At June 30, 2023, we had cash and cash equivalents of approximately $296 million. Prior to the end of the quarter, we elected to draw funds available to us under our credit facility, before the term portion of the commitments expired to maintain flexibility and maximize our liquidity. In the second quarter 2023, we purchased approximately 315,000 shares of common stock for approximately $53 million. At June 30, 2023, we had approximately $467 million remaining under our share repurchase authorization. Actual shares outstanding at June 30, 2023 approximated 103.3 million. Conference Call Information: The company will hold a conference call today from 4:00-5:00 p.m. CDT to discuss the quarterly earnings. Investors will have the opportunity to listen to the conference call live over the internet by going to investor.jbhunt.com. Please log on 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, an online replay of the earnings call webcast will be available a few hours after the completion of the call. Forward-Looking Statements: This press release may contain forward-looking statements, which are based on information currently available. Actual results may differ materially from those currently anticipated due to a number of factors, including, but not limited to, those discussed in Item 1A of our Annual Report filed on Form 10-K for the year ended December 31, 2022. We assume no obligation to update any forward-looking statement to the extent we become aware that it will not be achieved for any reason. This press release and additional information will be available to interested parties on our website, www.jbhunt.com. About J.B. Hunt J.B. Hunt Transport Services Inc. is on a mission to create the most efficient transportation network in North America. The company's industry-leading solutions and mode-neutral approach generate value for customers by eliminating waste, reducing costs and enhancing supply chain visibility. Powered by one of the largest company-owned fleets in the country with more than 162,000 pieces of trailing equipment and nearly one million accessible trucks through its J.B. Hunt 360°® digital freight marketplace, J.B. Hunt can meet the unique shipping needs of any business, from first mile to final delivery, and every shipment inbetween. Through disciplined investments in its people, technology and capacity, J.B. Hunt is delivering exceptional value and service that enable long-term growth for the company and its stakeholders. J.B. Hunt Transport Services Inc. is a Fortune 500 company, an S&P 500 company and a component of the Dow Jones Transportation Average. Its stock trades on NASDAQ under the ticker symbol JBHT. J.B. Hunt Transport Inc. is a wholly owned subsidiary of JBHT. The company's services include intermodal, dedicated, refrigerated, truckload, less-than-truckload, flatbed, single source, last mile, transload and more. For more information, visit www.jbhunt.com. J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Three Months Ended June 30 2023 2022 % Of % Of Amount Revenue Amount Revenue Operating revenues, excluding fuel surcharge revenues $ 2,707,560 $ 3,159,759 Fuel surcharge revenues 425,063 677,773 Total operating revenues 3,132,623 100.0 % 3,837,532 100.0 % Operating expenses Rents and purchased transportation 1,404,586 44.8 % 1,920,823 50.1 % Salaries, wages and employee benefits 821,876 26.2 % 841,825 21.9 % Fuel and fuel taxes 171,846 5.5 % 265,636 6.9 % Depreciation and amortization 179,972 5.7 % 157,571 4.1 % Operating supplies and expenses 128,949 4.1 % 126,383 3.3 % Insurance and claims 63,893 2.1 % 87,258 2.3 % General and administrative expenses, net of asset dispositions 61,472 2.1 % 59,764 1.6 % Operating taxes and licenses 18,951 0.6 % 16,323 0.4 % Communication and utilities 10,366 0.3 % 8,866 0.2 % Total operating expenses 2,861,911 91.4 % 3,484,449 90.8 % Operating income 270,712 8.6 % 353,083 9.2 % Net interest expense 14,604 0.4 % 12,842 0.3 % Earnings before income taxes 256,108 8.2 % 340,241 8.9 % Income taxes 66,556 2.1 % 84,899 2.2 % Net earnings $ 189,552 6.1 % $ 255,342 6.7 % Average diluted shares outstanding 104,566 105,387 Diluted earnings per share $ 1.81 $ 2.42 J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Statements of Earnings (in thousands, except per share data) (unaudited) Six Months Ended June 30 2023 2022 % Of % Of Amount Revenue Amount Revenue Operating revenues, excluding fuel surcharge revenues $ 5,450,070 $ 6,201,976 Fuel surcharge revenues 912,142 1,124,144 Total operating revenues 6,362,212 100.0 % 7,326,120 100.0 % Operating expenses Rents and purchased transportation 2,872,384 45.1 % 3,758,163 51.3 % Salaries, wages and employee benefits 1,646,875 25.9 % 1,605,416 21.9 % Fuel and fuel taxes 367,680 5.8 % 455,102 6.2 % Depreciation and amortization 355,784 5.6 % 306,334 4.2 % Operating supplies and expenses 257,308 4.0 % 233,322 3.2 % Insurance and claims 134,221 2.1 % 133,389 1.8 % General and administrative expenses, net of asset dispositions 121,879 2.0 % 97,209 1.4 % Operating taxes and licenses 37,058 0.6 % 32,073 0.4 % Communication and utilities 20,822 0.3 % 17,735 0.2 % Total operating expenses 5,814,011 91.4 % 6,638,743 90.6 % Operating income 548,201 8.6 % 687,377 9.4 % Net interest expense 29,393 0.4 % 25,429 0.4 % Earnings before income taxes 518,808 8.2 % 661,948 9.0 % Income taxes 131,488 2.1 % 163,282 2.2 % Net earnings $ 387,320 6.1 % $ 498,666 6.8 % Average diluted shares outstanding 104,647 105,729 Diluted earnings per share $ 3.70 $ 4.72 Financial Information By Segment (in thousands) (unaudited) Three Months Ended June 30 2023 2022 % Of % Of Amount Total Amount Total Revenue Intermodal $ 1,489,148 48 % $ 1,832,778 48 % Dedicated 887,593 28 % 903,925 24 % Integrated Capacity Solutions 343,691 11 % 605,606 16 % Final Mile Services 223,939 7 % 274,991 7 % Truckload 191,803 6 % 227,909 5 % Subtotal 3,136,174 100 % 3,845,209 100 % Intersegment eliminations (3,551 ) (0 %) (7,677 ) (0 %) Consolidated revenue $ 3,132,623 100 % $ 3,837,532 100 % Operating income Intermodal $ 142,860 53 % $ 202,529 57 % Dedicated 113,615 42 % 94,141 27 % Integrated Capacity Solutions (4,419 ) (2 %) 23,222 7 % Final Mile Services 14,824 5 % 13,249 4 % Truckload 3,798 2 % 20,024 5 % Other (1) 34 0 % (82 ) (0 %) Operating income $ 270,712 100 % $ 353,083 100 % Six Months Ended June 30 2023 2022 % Of % Of Amount Total Amount Total Revenue Intermodal $ 3,028,707 48 % $ 3,436,164 47 % Dedicated 1,766,735 28 % 1,680,046 23 % Integrated Capacity Solutions 728,465 11 % 1,264,478 17 % Final Mile Services 449,016 7 % 509,963 7 % Truckload 397,665 6 % 457,438 6 % Subtotal 6,370,588 100 % 7,348,089 100 % Intersegment eliminations (8,376 ) (0 %) (21,969 ) (0 %) Consolidated revenue $ 6,362,212 100 % $ 7,326,120 100 % Operating income Intermodal $ 311,518 57 % $ 403,500 59 % Dedicated 216,175 39 % 173,832 25 % Integrated Capacity Solutions (9,791 ) (2 %) 47,415 7 % Final Mile Services 21,444 4 % 13,839 2 % Truckload 8,788 2 % 48,928 7 % Other (1) 67 0 % (137 ) (0 %) Operating income $ 548,201 100 % $ 687,377 100 % (1) Includes corporate support activity Operating Statistics by Segment (unaudited) Three Months Ended June 30 2023 2022 Intermodal Loads 501,681 539,024 Average length of haul 1,655 1,658 Revenue per load $ 2,968 $ 3,400 Average tractors during the period * 6,517 6,562 Tractors (end of period) * 6,491 6,620 Trailing equipment (end of period) 116,481 110,654 Average effective trailing equipment usage 95,815 108,860 Dedicated Loads 1,104,896 1,149,401 Average length of haul 172 167 Revenue per truck per week** $ 5,182 $ 5,380 Average trucks during the period*** 13,236 13,001 Trucks (end of period) *** 13,228 13,236 Trailing equipment (end of period) 29,773 27,108 Average effective trailing equipment usage 31,979 32,099 Integrated Capacity Solutions Loads 194,635 262,213 Revenue per load $ 1,766 $ 2,310 Gross profit margin 13.0% 16.1% Employee count (end of period) 769 1,022 Approximate number of third-party carriers (end of period) 144,600 154,800 Marketplace for J.B. Hunt 360 revenue (millions) $ 225.0 $ 392.1 Final Mile Services Stops 1,141,415 1,501,268 Average trucks during the period*** 1,551 1,873 Truckload Loads 101,402 95,245 Revenue per load $ 1,892 $ 2,393 Average length of haul 659 543 Tractors (end of period) Company-owned 33 165 Independent contractor 2,035 1,850 Total tractors 2,068 2,015 Trailers (end of period) 15,358 12,770 Average effective trailing equipment usage 13,108 9,928 * Includes company-owned and independent contractor tractors ** Using weighted workdays *** Includes company-owned, independent contractor, and customer-owned trucks Operating Statistics by Segment (unaudited) Six Months Ended June 30 2023 2022 Intermodal Loads 987,772 1,049,760 Average length of haul 1,653 1,665 Revenue per load $ 3,066 $ 3,273 Average tractors during the period * 6,558 6,412 Tractors (end of period) * 6,491 6,620 Trailing equipment (end of period) 116,481 110,654 Average effective trailing equipment usage 96,061 107,372 Dedicated Loads 2,182,268 2,220,631 Average length of haul 172 167 Revenue per truck per week** $ 5,120 $ 5,108 Average trucks during the period*** 13,353 12,782 Trucks (end of period) *** 13,228 13,236 Trailing equipment (end of period) 29,773 27,108 Average effective trailing equipment usage 31,679 32,274 Integrated Capacity Solutions Loads 397,166 534,040 Revenue per load $ 1,834 $ 2,368 Gross profit margin 13.3% 14.4% Employee count (end of period) 769 1,022 Approximate number of third-party carriers (end of period) 144,600 154,800 Marketplace for J.B. Hunt 360 revenue (millions) $ 475.6 $ 822.4 Final Mile Services Stops 2,303,553 2,902,982 Average trucks during the period*** 1,601 1,761 Truckload Loads 200,186 186,384 Revenue per load $ 1,986 $ 2,454 Average length of haul 650 548 Tractors (end of period) Company-owned 33 165 Independent contractor 2,035 1,850 Total tractors 2,068 2,015 Trailers (end of period) 15,358 12,770 Average effective trailing equipment usage 13,118 9,452 * Includes company-owned and independent contractor tractors ** Using weighted workdays *** Includes company-owned, independent contractor, and customer-owned trucks J.B. HUNT TRANSPORT SERVICES, INC. Condensed Consolidated Balance Sheets (in thousands) (unaudited) June 30, 2023 December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 295,929 $ 51,927 Accounts Receivable, net 1,286,244 1,528,075 Prepaid expenses and other 555,407 631,776 Total current assets 2,137,580 2,211,778 Property and equipment 8,424,327 7,999,480 Less accumulated depreciation 2,940,246 3,019,663 Net property and equipment 5,484,081 4,979,817 Other assets, net 626,071 594,987 $ 8,247,732 $ 7,786,582 LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities: Current debt $ 249,844 $ - Trade accounts payable 767,428 798,776 Claims accruals 492,222 452,149 Accrued payroll 119,898 188,252 Other accrued expenses 139,132 129,054 Total current liabilities 1,768,524 1,568,231 Long-term debt 1,195,309 1,261,738 Other long-term liabilities 393,181 369,314 Deferred income taxes 978,795 920,531 Stockholders' equity 3,911,923 3,666,768 $ 8,247,732 $ 7,786,582 Supplemental Data (unaudited) June 30, 2023 December 31, 2022 Actual shares outstanding at end of period (000) 103,345 103,743 Book value per actual share outstanding at end of period $ 37.85 $ 35.34 Six Months Ended June 30 2023 2022 Net cash provided by operating activities (000) $ 1,097,290 $ 784,527 Net capital expenditures (000) $ 853,778 $ 598,094 View source version on businesswire.com: https://www.businesswire.com/news/home/20230718683431/en/
