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Marten Transport Ltd. (MRTN) filed Quarterly Report for the period ended 2011-09-30.
Marten Transport Ltd. has a market cap of $382.6 million; its shares were traded at around $17.4 with a P/E ratio of 17.4 and P/S ratio of 0.7. The dividend yield of Marten Transport Ltd. stocks is 0.5%. Marten Transport Ltd. had an annual average earning growth of 4.1% over the past 10 years. GuruFocus rated Marten Transport Ltd. the business predictability rank of 2.5-star.
This is the annual revenues and earnings per share of MRTN over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of MRTN.
Highlight of Business Operations:
Our operating revenue increased $65.0 million, or 17.1%, in the first nine months of 2011. Our operating revenue, net of fuel surcharges, increased $36.6 million, or 11.3%, compared with the first nine months of 2010. Truckload segment revenue, net of fuel surcharges, increased 8.5% primarily due to an increase in our average truckload revenue, net of fuel surcharges, per tractor per week of 6.4% along with an increase in our average fleet size of 43 tractors, or 2.0%, in the first nine months of 2011. Fuel surcharge revenue increased by $28.4 million, or 51.5%, which was caused by significantly higher fuel prices in the first nine months of 2011. The changes in our operating statistics are primarily the result of the continued growth of our regional temperature-controlled operations, which we have increased to 64.8% of our truckload fleet as of September 30, 2011 from 48.2% as of September 30, 2010. By focusing on shorter lengths of haul in certain defined areas, we are addressing customer trends toward regional distribution to lower their transportation expense, furthering our own objectives of reducing fuel consumption per load, and matching some of our drivers desires to stay closer to home. The concentration of a portion of our fleet in these markets is evident in a 5.3% reduction from the first nine months of 2010 in average length of haul to 629 miles. Logistics segment revenue, net of intermodal fuel surcharges, increased 19.3% compared with the first nine months of 2010. The increase in logistics revenue primarily resulted from volume growth in each of our internal brokerage and intermodal services. Logistics revenue represented 24.5% of our operating revenue in the first nine months of 2011 compared to 23.3% in the first nine months of 2010.Our business requires substantial, ongoing capital investments, particularly for new tractors and trailers. At September 30, 2011, we had approximately $20.5 million of cash and cash equivalents and $313.1 million in stockholders equity. As of that date, we had no long-term debt outstanding. In the first nine months of 2011, net cash flows provided by operating activities were primarily used to repay $19.3 million of long-term debt, to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $17.1 million, to partially construct two regional operating facilities in the amount of $4.0 million, and to increase cash and cash equivalents by $15.2 million. We estimate that capital expenditures, net of proceeds from dispositions, will be approximately $20 million for the remainder of 2011. We paid quarterly cash dividends of $0.02 per share of common stock in the first three quarters of 2011 totaling $1.3 million. We believe our sources of liquidity are adequate to meet our current and anticipated needs for at least the next twelve months. Based upon anticipated cash flows, existing cash and cash equivalents balances, current borrowing availability and other sources of financing we expect to be available to us, we do not anticipate any significant liquidity constraints in the foreseeable future.
As a result of the foregoing factors, our operating expenses as a percentage of operating revenue, or “operating ratio,” was 92.9% in the 2011 period compared with 92.2% in the 2010 period. The operating ratio for our Truckload segment was 92.1% and 91.5% in the 2011 and 2010 periods, respectively. The operating ratio for our Logistics segment was 95.1% and 94.6% in the 2011 and 2010 periods, respectively. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharge revenue, was 91.3% for the 2011 period and 90.9% for the 2010 period.
In the first nine months of 2011, net cash flows provided by operating activities were primarily used to repay $19.3 million of long-term debt, to purchase new revenue equipment, net of proceeds from dispositions, in the amount of $17.1 million, to partially construct two regional operating facilities in the amount of $4.0 million, and to increase cash and cash equivalents by $15.2 million. We estimate that capital expenditures, net of proceeds from dispositions, will be approximately $20 million for the remainder of 2011. We paid quarterly cash dividends of $0.02 per share of common stock in each of the first three quarters of 2011 totaling $1.3 million. We currently expect to continue to pay quarterly cash dividends in the future. The payment of cash dividends in the future, and the amount of any such dividends, will depend upon our financial condition, results of operations, cash requirements, and certain corporate law requirements, as well as other factors deemed relevant by our Board of Directors. We believe our sources of liquidity are adequate to meet our current and anticipated needs for at least the next twelve months. Based upon anticipated cash flows, existing cash and cash equivalents balances, current borrowing availability and other sources of financing we expect to be available to us, we do not anticipate any significant liquidity constraints in the foreseeable future.
In the first nine months of 2011, we replaced most of our company-owned tractors within approximately 4.5 years and our trailers within approximately 5.5 years after purchase. Our useful lives for depreciating tractors is five years and trailers is seven years, with a 25% salvage value for tractors and a 35% salvage value for trailers. These salvage values are based upon the expected market values of the equipment after five years for tractors and seven years for trailers. Depreciation expense calculated in this manner approximates the continuing declining value of the revenue equipment, and continues at a consistent straight-line rate for units held beyond the normal replacement cycle. Calculating tractor depreciation expense with a five-year useful life and a 25% salvage value results in the same depreciation rate of 15% of cost per year and the same net book value of 32.5% of cost at the 4.5-year replacement date as using a 4.5-year useful life and 32.5% salvage value. As a result, there is no difference in recorded depreciation expense on a quarterly or annual basis with our five-year useful life and 25% salvage value compared with a 4.5-year useful life and 32.5% salvage value. Similarly, calculating trailer depreciation expense with a seven-year useful life and a 35% salvage value results in the same depreciation rate of 9.3% of cost per year and the same net book value of 48.9% of cost at the 5.5-year replacement date as using a 5.5-year useful life and 48.9% salvage value. As a result, there is no difference in recorded depreciation expense on a quarterly or annual basis with our seven-year useful life and 35% salvage value compared with a 5.5-year useful life and 48.9% salvage value.
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