Marten Transport, Ltd. · NASDAQ:MRTN
Marten Transport — Q4 2014 Earnings Presentation
32 slides from Marten Transport's earnings presentation, May 17, 2015
Slide 1: Allan tl
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Slide 2: Disclosure
Disclosure This presentation and discussion will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “anticipates,” “intends,” “estimates,” or similar expressions are intended to identify these forward-looking statem
Slide 3: Marten's Culture
Marten’s Culture People Focused on Today’s Accelerated Business Environment “Managers may believe that industry structures are ordained by the Good Lord, but they can – and often do – change overnight.” “The Discipline of Innovation” Harvard Business Review May-June 1985 By Peter F. Drucker “Perhaps
Slide 4: Marten's Strategic Vision
Marten’s Strategic Vision Multifaceted Transportation Service Solutions • Truckload Business Platform – regional and OTR operating from 14 regional service centers • Dedicated Business Platform – customized solutions tailored to individual customers’ requirements utilizing refrigerated trailers, dry
Slide 5: Diverse, Dense and Efficient Freight Network
Diverse, Dense and Efficient Freight Network •Top five accounts – 27% of revenue in 2014 vs. 43% in 2009 •No current account more than 10% of revenue in 2014 - Wal-Mart increased primarily with additional dedicated freight – the percentage of other larger accounts (with none more than 6%) continues
Slide 6: Diverse, Dense and Efficient Freight Network
Diverse, Dense and Efficient Freight Network 45% $3,600 40% $3,400 35% $3,200 30% $3,000 25% $2,800 20% $2,600 2009 2010 2011 2012 2013 2014 Top 5 Customers' %of Revenue Rev/ Tractor/ Wk Revenue per tractor has increased 27% from 2009 to 2014 with Q4 ’14 being our nineteenth consecutive quarterly ye
Slide 7: Increasing Customer Diversity
Increasing Customer Diversity 900 800 700 600 500 400 300 200 100 0 2007 2009 2011 2013 2014 7
Slide 8: Truckload and Dedicated Tractors
Truckload and Dedicated Tractors 2014 Organic Growth 2,340 2,320 2,300 2,280 2,260 2,240 2,220 2,200 2,180 2,160 2,140 Dec 31, '13 Mar 31, '14 June30, '14 Sept 30, '14 Dec 31, '14 The organic growth of 161 tractors, or 7.4%, in 2014 is a direct result of our continuing efforts to grow our dedicated
Slide 9: Load Growth
Load Growth 500,000 2.5% 10.2% 7.4 400,000 7.4 % 5.5 % % 300,000 200,000 100,000 0 2009 2010 2011 2012 2013 2014 Truckload and Dedicated Brokerage Intermodal 9
Slide 10: Regional Operating Centers Growth
Regional Operating Centers Growth THE FOUNDATION of Marten’s service and growth Our operating centers expanded Mondovi, and were WI Corporate Officepaid for in challenging times Wilsonville, OR Mondovi, WI Carlisle, PA Indianapolis, IN Kansas City, KS Richmond, VA Mira Loma, CA Memphis, TN Otay Mesa
Slide 11: Regional Truckload and Dedicated Operations Growth
Regional Truckload and Dedicated Operations Growth 2,000 1,800 421 1,600 227 1,400 109 # of Tractors 1,200 1,000 800 1,392 1,448 1,462 600 67 400 569 200 80 0 110 Dec '07 Dec '09 Dec '11 Dec '13 Dec '14 Regional Dedicated Increased number of dedicated customers from 2 at Dec’11 to 11 at Dec’13 to 23
Slide 12: Mexico Growth
Mexico Growth Door-to-door cost saving solutions •Expanded into Western Mexico with Otay Mesa facility in Sept ’13 •Moved into new, larger company-owned Laredo facility in Dec ’13 •Opening another entry facility location in ’15 Revenue Growth (including fuel surcharge) In millions $65 64% $60 $55 $5
Slide 13: Brokerage Growth
Brokerage Growth Initiated in 2005 to provide surge capability for our customers Load Growth Revenue Growth (including fuel surcharge) In millions 40,000 4% $60 8% 8% 10% -1% 35,000 28% 17% $50 30,000 18% 16% $40 25,000 16% 41% 20,000 63% $30 15,000 24% $20 32% 10,000 $10 5,000 0 $0 2009 2010 2011 2
Slide 14: Intermodal Growth
Intermodal Growth Initiated temperature-controlled TOFC in ’05 We are the largest truckload intermodal temperature-controlled carrier with BNSF Expanded intermodal growth with longer drayage supported by our regional business platform Yearly Revenue Growth Yearly Load Growth (excluding fuel surcharg
Slide 15: Intermodal Results – Reflecting Rail Service Issues
Intermodal Results – Reflecting Rail Service Issues – Q4 ’14 Start of Turnaround In thousands Operating Income $1,450 (Loss) • Rail service improved somewhat in Q4’14 $1,250 • Increased our rates during Q4 ’14 to recover $1,050 $850 costs for rail service delays $650 • Continuously decreasing refuel
Slide 16: Recognition for Efficiency, Innovation and Integrity
Recognition for Efficiency, Innovation and Integrity • Forbes’ Top 100 Most Trustworthy Companies – one of only 4 companies named for the 4th time in the last 5 years surveyed Recognized U.S. exchange-listed companies displaying the highest corporate integrity, clear financial reporting and transp
Slide 17: Net Capital Expenditures
Net Capital Expenditures In millions $118.6 $120 $110 $100 $88.1 $81.2 $72.8 $80 $60 $48.4 $40 $20 $0 2010 2011 2012 2013 2014 2015 Estimate 17
Slide 18: Increasing Revenue Equipment Costs
Increasing Revenue Equipment Costs Average Monthly Depreciation Tractors Trailers $1,500 $400 $1,462 $387 $1,450 $390 $382 $1,413 $1,400 $380 $372 $1,349 $368 $1,350 $370 $1,300 $360 $355 $1,266 $1,250 $350 $1,219 $1,185 $339 $1,200 $340 $1,150 $330 $1,100 $320 $1,050 $310 $1,000 $300 Dec '09 Dec '1
Slide 19: Increasing Driver Pay
Increasing Driver Pay Annual driver pay increases not sacrificed for continuous margin $0.52 improvement $0.50 Cents per Mile $0.48 $0.46 $0.44 $0.42 $0.40 2009 2010 2011 2012 2013 2014 • Built a driver pay package unique to the electronic log era • Industry leader to compensate drivers after one ho
Slide 20: Operating Statistics Comparison
Operating Statistics Comparison Q4’14 vs. 2014 vs. 2014 vs. Truckload and Dedicated: Q4’13 2013 2009 Average revenue, net of fuel 3.3% 3.1% 26.6% surcharges, per tractor per week Miles per tractor 0.8% (0.3)% 6.1% Loads 5.4% 1.0% 27.4% Loads per tractor per week 1.2% 0.6% 35.0% Intermodal loads (7.9
Slide 21: 2014 Segment Information
2014 Segment Information (Dollars in Thousands) Q1 Q2 Q3 Q4 2014 Operating revenue: Truckload, net of fuel s/c revenue $86,802 $90,316 $89,515 $91,825 $358,458 Truckload fuel s/c revenue 23,712 23,699 21,821 20,583 89,815 Total Truckload revenue $114,01 $110,514 $111,336 $112,408 $448,273 5 Dedicate
Slide 22: 2013 Segment Information
2013 Segment Information (Dollars in Thousands) Q1 Q2 Q3 Q4 2013 Operating revenue: Truckload, net of fuel s/c revenue $89,654 $91,178 $93,854 $92,112 $366,798 Truckload fuel s/c revenue $25,186 $24,647 $24,694 $23,634 $98,161 Total Truckload revenue $115,82 $114,840 $118,548 $115,746 $464,959 5 Ded
Slide 23: 2014 Segment Information
2014 Segment Information Q1 Q2 Q3 Q4 2014 Truckload Segment: Avg. revenue, net of fuel s/c $3,507 $3,655 $3,611 $3,698 $3,618 revenue, per tractor per week Avg. tractors 1,925 1,901 1,886 1,890 1,900 Avg. miles per trip 683 676 674 696 682 Non- revenue miles percentage 9.3% 9.9% 9.6% 8.5% 9.3% Total
Slide 24: 2013 Segment Information
2013 Segment Information Q1 Q2 Q3 Q4 2013 Truckload Segment: Avg. revenue, net of fuel s/c $3,376 $3,461 $3,522 $3,528 $3,471 revenue, per tractor per week Avg. tractors 2,065 2,026 2,028 1,987 2,027 Avg. miles per trip 649 639 639 652 645 Non- revenue miles percentage 10.6% 10.8% 10.5% 9.9% 10.4% T
Slide 25: Revenue per Tractor Growth
Revenue per Tractor Growth Average Revenue, Net of Fuel Surcharges, per Tractor per Week $3,750 3.3% 3.1 $3,500 3.8 % % 5.6 % $3,250 6.5 % $3,000 5.2 % $2,750 $2,500 2009 2010 2011 2012 2013 2014 Q4'13 Q4'14 Revenue per tractor has increased 27% from 2009 to 2014 with Q4’14 being our nineteenth cons
Slide 26: Financial Highlights
Financial Highlights Q4’14 net income and operating revenue were the highest in Marten’s history Q4’14 Q4’13 2014 2013 2012 2011 2010 2009 Operating $659. $638. $603. $516. $505 revenue $173.5 $166.2 $672.9 2 5 7 9 .9 $16. Net income $9.0 $7.3 $29.8 $30.1 $27.3 $24.3 $19.7 3 $0.4 Diluted EPS $0.27 $
Slide 27: Marten People Drive Our Freight and Cost Efficiencies and Profitable Growth
Marten People Drive Our Freight and Cost Efficiencies and Profitable Growth • People Initiate and Implement Our Strategic Vision and Key Strategic Initiatives • “The more they know, the more they’ll understand. The more they understand, the more they’ll care. Once they care, there’s no stopping them
Slide 28: Marten People Drive Our Freight and Cost Efficiencies and Profitable Growth
Marten People Drive Our Freight and Cost Efficiencies and Profitable Growth • Sustainable Cost and Productivity Improvements Driven by our People and Ongoing Development of our Systems and Processes Continuous Revenue per Tractor Growth Continuous Tractor and Trailer Miles Utilization Improvemen
Slide 29: Continued Improvement Despite Challenging Industry Headwinds
Continued Improvement Despite Challenging Industry Headwinds Operating Ratio, Net of Fuel Surcharge 94% 93.5% 93% 92.0% 92% 91.2% 91.1% 91% 90.7% 90.2% 90% 2009 2010 2011 2012 2013 2014 Ratio improved to 88.7% in Q4’14 from 90.6% in Q4’13 The ratio for Q4’14 was our best since Q4’04, when our operat
Slide 30: Continued Improvement Despite Challenging Industry Headwinds
Continued Improvement Despite Challenging Industry Headwinds Earnings – Cents Per Diluted Share $1.00 10% (1)% 12% $0.80 22% 22% $0.60 $0.40 $0.20 $0.00 2009 2010 2011 2012 2013 2014 EPS improved 23% to $0.27 in Q4’14 from $0.22 in Q4’13 30 82% increase from 2009 to 2014
Slide 31: Stephens Inc. EV/CY15 EBITDA Comparison
Stephens Inc. EV/CYI5 EBITDA Comparison Source: Stephens Estimates and Company Filings 31
Slide 32: Marten's Culture | Marten's Vision
Marten’s Culture | Marten’s Vision Marten’s People “Sufficient urgency around a strategically rational and emotionally exciting opportunity is the bedrock upon which all else is built.” “Accelerate!” Harvard Business Review November 2012 By John P. Kotter Konosuke Matsushita Professor of Leadership,