Universal Truckload Services, Inc. Reports First Quarter 2016 Financial Results

WARREN, Mich. - Universal Truckload Services, Inc. (NASDAQ: UACL) today reported first quarter 2016 net income of $7.5 million, or $0.26 per basic and diluted share, on total operating revenues of $260.4 million.  This compares to $8.2 million, or $0.27 per basic and diluted share, during the first quarter of 2015 on total operating revenues of $263.6 million. Operating revenues from our transportation services decreased $10.5 million, or 6.5%, to $149.9 million in the quarter ended April 2, 2016.  The decline included an $8.4 million decrease in fuel surcharges, and a 6.7% decrease in average operating revenues per load, excluding fuel surcharges. Load volumes were relatively stable, increasing a modest 1.1%, however, a weak pricing environment and declining fuel surcharges drove the overall decline.  Value-added service revenues increased $5.3 million, or 7.6%, in the most recent quarter to $75.6 million reflecting new business awarded in the second half of 2015.  Intermodal service revenues also increased, up 6.0% to $34.9 million compared to the same period last year.  Our intermodal service revenues include a $2.7 million increase in drayage revenues, partially offset by lower domestic intermodal and depot services. Consolidated income from operations decreased $1.1 million to $13.9 million in the first quarter of 2016 and EBITDA decreased 6.8% to $22.5 million during the same period.  Our operating margin and EBITDA margin for the first quarter of 2016 are 5.3% and 8.6% of operating revenues.  These profitability metrics compare to 5.7% and 9.1%, respectively, in the first quarter of 2015. Income from operations in our transportation segment decreased 7.3% to $5.9 million in the first quarter of 2016, despite a $9.7 million decline in transportation segment revenues.  Income from operations in our logistics segment, which includes value-added services and dedicated transportation services, decreased 2.6%, or $0.2 million to $8.5 million on $102.6 million of operating revenues compared to $96.2 million in operating revenues in the same period last year. “We are starting to see the growth anticipated in our value-added services,” commented Universal’s Chief Executive Officer, Jeff Rogers.  “However, a soft pricing environment and low diesel prices continues to put downward pressure in our transportation service revenues.  Once again, intermodal performed very well for us and we are getting excited about the improvements made in our dedicated operations.  There is work ahead of us, but we will stay focused on driving profitable growth, and ensure we are achieving maximum efficiency with our strong business model.” 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 April 2, 2016, we held cash and cash equivalents totaling $11.7 million and marketable securities of $13.4 million.  Outstanding debt, net of debt issue costs, totaled $233.4 million and our capital expenditures totaled $36.0 million during the first three months of 2016. Universal Truckload Services, Inc. also 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 May 9, 2016 and is expected to be paid on May 19, 2016.  Conference call: We invite investors and analysts to our quarterly earnings conference call.  During the call, Jeff Rogers, CEO, Jude Beres, CFO, and Steven Fitzpatrick, Vice President of Finance and Investor Relations, will discuss Universal’s first quarter 2016 financial performance, the demand outlook in our key markets and other trends impacting our business. Quarterly Earnings Conference Call Dial-in Details   A replay of the conference call will be available beginning two hours after the call through May 26, 2016, by calling (855) 859-2056 (toll free) or +1 (404) 537-3406 (toll) and using conference ID 83911871. The call will also 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, and in Mexico, Canada and Colombia.  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, intermodal, and value-added 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.               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 EBITDA as supplemental measures of our performance. We define 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. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis. 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 net income, the most comparable GAAP measure, to EBITDA for each of the periods indicated: