Highlights:
- Diluted earnings per share (EPS) of $0.44 for the first quarter in-line with prior year
- First quarter revenue of $915 million
- Operating income of $37 million or 4.1% of revenue, a 40-basis point improvement over Q1 2024
- Returned $21 million to shareholders in the first quarter through share repurchases and dividends
- Ended the quarter with cash of $141 million
- Net debt/EBITDA of 0.4x
OAK BROOK, Ill., May 08, 2025 (GLOBE NEWSWIRE) -- Hub Group, Inc. ( HUBG) announced first quarter 2025 net income of $27 million and diluted earnings per share of $0.44. Net income for the first quarter of 2024 was $27 million, or $0.44 per diluted share.
“I am proud of the team’s performance in the first quarter as we remained focused on yield management, cost containment and operating efficiency initiatives, resulting in an operating income margin of 4.1%, a 40-basis point improvement over last year and a 20-basis point improvement over the fourth quarter. This included a 70-basis point improvement in our Logistics segment operating margins versus last year. Looking ahead we are focused on providing exceptional service and value to our customers while effectively managing our costs and investing in our business to deliver long term growth,” said Phil Yeager, Hub Group’s President, Chief Executive Officer, and Vice Chairman.
First Quarter 2025 Results
Consolidated revenue for the first quarter of 2025 of $915 million, an 8% decline from $999 million reported in the first quarter of 2024. Strong intermodal volume growth of 8% was offset by lower revenue per unit in intermodal and brokerage, decreased fuel revenue, and slowing shipping patterns in our Logistics segment.
First quarter purchased transportation and warehousing costs of $658 million decreased 11% compared to prior year due to lower rail and third-party warehouse costs. Salaries and benefits of $149 million were 3% higher than prior year driven by additional warehouse and driver team members and the addition of EASO. Depreciation and amortization of $33 million decreased 15% in the quarter. Insurance and claims of $11 million decreased 14% due to lower claim costs in the quarter. General and administrative expenses of $27 million were comparable to the prior year.
Operating income for the first quarter was $37 million or 4.1% of revenue, a 40-basis point improvement over the prior year. EBITDA (non-GAAP) for the quarter was $85 million. Net debt/EBITDA was 0.4x, below the leverage target range of 0.75 to 1.25x.
First Quarter 2025 Segment Results
First quarter Intermodal and Transportation Solutions (“ITS”) Segment revenue was $530 million, as compared to $552 million in the prior year due to mix, price and fuel partially offset by higher intermodal volumes. ITS operating income increased to $14 million, or 2.7% of revenue, due to cost control efforts, lower dedicated start-up costs, and improved insurance and claims expenses.
First quarter Logistics Segment revenue was $411 million, as compared to $480 million last year due to lower volume and revenue per load in our brokerage business, exiting of unprofitable business in consolidation and fulfilment, and seasonal softness in managed transportation and final mile businesses. First quarter operating income was $23 million, or 5.7% of revenue, a 70-basis point improvement over prior year as positive contribution from consolidation and fulfillment, managed transportation, and final mile fully offset a lower brokerage margin.
Capital expenditures for the first quarter of 2025 totaled $19 million and, as of March 31, 2025, we had cash of $141 million.
2025 Outlook
We expect 2025 diluted earnings per share will range from $1.75 to $2.25. We estimate revenue of approximately $3.6 billion to $4.0 billion for the full year. We project an effective tax rate of approximately 24% and capital expenditures in the range of $40 million to $50 million for the full year.
Non-GAAP Financial Measures
In this press release, we present certain non-GAAP financial measures, including EBITDA and net debt/EBITDA. As required by the rules of the Securities and Exchange Commission (“SEC”), we have provided herein a reconciliation of these non-GAAP financial measures to the most directly comparable measures under GAAP, along with an explanation why management believes these non-GAAP financial measures provide relevant and useful information. These non-GAAP financial measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP and are not necessarily comparable to non-GAAP measures that may be presented by other companies.
Certain Forward-Looking Statements
Statements in this press release that are not historical facts are forward-looking statements, provided pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors that might cause the actual performance of Hub Group to differ materially from those expressed or implied by this discussion and, therefore, should be viewed with caution. Further information on the risks that may affect Hub Group’s business is included in filings it makes with the SEC from time to time, including those discussed under the “Risk Factors” section in Hub Group’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. Hub Group assumes no obligation to update any such forward-looking statements.
Conference Call
Hub Group, Inc. will hold a conference call at 5:00 p.m. Eastern Time on May 8, 2025, to discuss first quarter 2025 results. Hosting the conference call will be Phil Yeager, President, CEO and Vice Chairman and Kevin Beth, Executive Vice President, Chief Financial Officer and Treasurer.
This call is being webcast and can be accessed through the Investors link on Hub Group’s web site at www.hubgroup.com. The webcast is listen-only. Those interested in participating in the question-and-answer session should follow the telephone dial-in instructions below.
To participate in the conference call by telephone, please pre-register at https://register-conf.media-server.com/register/BIb40a65630f35498fb1da8bc575bbf057 to receive the dial-in number and unique PIN. On the day of the call, dial in approximately ten minutes prior to the scheduled call time and enter the unique participant PIN received during registration. The call will be limited to 60 minutes, including questions and answers. An audio replay will be available through the Investors link on the Company's web site at www.hubgroup.com. A replay will be available for 30 days.
About Hub Group
Hub Group offers comprehensive transportation and logistics management solutions. Keeping our customers’ needs in focus, Hub Group designs, continually optimizes, and applies industry-leading technology to our customers’ supply chains for better service, greater efficiency, and total visibility. As an award-winning, publicly traded company ( HUBG) with approximately $4 billion in revenue, our nearly 6,000 employees and drivers across the globe are always in pursuit of “The Way Ahead” – a commitment to service, integrity and innovation. For more information, visit hubgroup.com.
SOURCE: Hub Group, Inc.
CONTACT: Garrett Holland, [email protected]
| HUB GROUP, INC. | ||||||||||||
| CONSOLIDATED STATEMENTS OF EARNINGS | ||||||||||||
| (in thousands, except per share amounts) | ||||||||||||
| (unaudited) | ||||||||||||
| Three Months Ended March 31, | ||||||||||||
| 2025 | 2024 | |||||||||||
| % of | % of | |||||||||||
| Amount | Revenue | Amount | Revenue | |||||||||
| Operating revenue | $ | 915,216 | 100.0 | % | $ | 999,493 | 100.0 | % | ||||
| Operating expenses: | ||||||||||||
| Purchased transportation and warehousing | 657,924 | 71.9 | % | 740,172 | 74.1 | % | ||||||
| Salaries and benefits | 149,413 | 16.3 | % | 144,497 | 14.4 | % | ||||||
| Depreciation and amortization | 32,578 | 3.6 | % | 38,331 | 3.8 | % | ||||||
| Insurance and claims | 10,882 | 1.2 | % | 12,618 | 1.3 | % | ||||||
| General and administrative | 27,146 | 2.9 | % | 27,234 | 2.7 | % | ||||||
| Loss (gain) on sale of assets, net | (65 | ) | 0.0 | % | (498 | ) | 0.0 | % | ||||
| Total operating expenses | 877,878 | 95.9 | % | 962,354 | 96.3 | % | ||||||
| Operating income | 37,338 | 4.1 | % | 37,139 | 3.7 | % | ||||||
| Other income (expense): | ||||||||||||
| Interest expense, net | (1,992 | ) | -0.2 | % | (2,506 | ) | -0.3 | % | ||||
| Other, net | 295 | 0.0 | % | (170 | ) | -0.0 | % | |||||
| Total other (expense) income, net | (1,697 | ) | -0.2 | % | (2,676 | ) | -0.3 | % | ||||
| Income before provision for income taxes | 35,641 | 3.9 | % | 34,463 | 3.4 | % | ||||||
| Provision for income taxes | 8,447 | 0.9 | % | 7,410 | 0.7 | % | ||||||
| Net income | 27,194 | 27,053 | ||||||||||
| Less: Net income attributable to non-controlling interests | 347 | - | ||||||||||
| Net income attributable to Hub Group, Inc. | $ | 26,847 | $ | 27,053 | ||||||||
| Earnings per share | ||||||||||||
| Basic | $ | 0.45 | $ | 0.44 | ||||||||
| Diluted | $ | 0.44 | $ | 0.44 | ||||||||
| Basic weighted average number of shares outstanding | 60,190 | 61,325 | ||||||||||
| Diluted weighted average number of shares outstanding | 60,420 | 61,666 | ||||||||||
| HUB GROUP, INC. | |||||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||
| (in thousands, except share data) | |||||||||||
| March 31, | December 31, | ||||||||||
| 2025 | 2024 | ||||||||||
| (unaudited) | |||||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS: | |||||||||||
| Cash and cash equivalents | $ | 112,674 | $ | 98,248 | |||||||
| Restricted cash | 28,436 | 28,700 | |||||||||
| Accounts receivable trade, net | 568,610 | 581,516 | |||||||||
| Accounts receivable other | 10,273 | 10,880 | |||||||||
| Prepaid taxes | 9,177 | 15,115 | |||||||||
| Prepaid expenses and other current assets | 23,642 | 33,870 | |||||||||
| TOTAL CURRENT ASSETS | 752,812 | 768,329 | |||||||||
| Restricted investments | 18,492 | 21,642 | |||||||||
| Property and equipment, net | 731,933 | 739,896 | |||||||||
| Right-of-use assets - operating leases | 221,888 | 233,651 | |||||||||
| Right-of-use assets - financing leases | 897 | 1,062 | |||||||||
| Other intangibles, net | 258,744 | 267,357 | |||||||||
| Goodwill | 812,235 | 814,309 | |||||||||
| Other non-current assets | 24,524 | 22,097 | |||||||||
| TOTAL ASSETS | $ | 2,821,525 | $ | 2,868,343 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
| CURRENT LIABILITIES: | |||||||||||
| Accounts payable trade | $ | 263,267 | $ | 279,982 | |||||||
| Accounts payable other | 32,318 | 29,069 | |||||||||
| Accrued payroll | 27,609 | 32,833 | |||||||||
| Accrued other | 87,573 | 91,441 | |||||||||
| Lease liability - operating leases | 44,449 | 45,492 | |||||||||
| Lease liability - financing leases | 636 | 663 | |||||||||
| Current portion of long-term debt | 99,564 | 100,001 | |||||||||
| TOTAL CURRENT LIABILITIES | 555,416 | 579,481 | |||||||||
| Deferred consideration | 28,436 | 30,639 | |||||||||
| Long-term debt | 152,504 | 164,361 | |||||||||
| Other non-current liabilities | 50,083 | 51,004 | |||||||||
| Lease liability - operating leases | 188,108 | 197,664 | |||||||||
| Lease liability - financing leases | 193 | 330 | |||||||||
| Deferred taxes | 150,586 | 152,913 | |||||||||
| STOCKHOLDERS' EQUITY: | |||||||||||
| Preferred stock, $.01 par value; 2,000,000 shares authorized; | |||||||||||
| no shares issued or outstanding in 2025 and 2024. | - | - | |||||||||
| Common stock | |||||||||||
| Class A: $.01 par value; 97,337,700 shares authorized; | |||||||||||
| 72,303,228 shares issued in both 2025 and 2024; | |||||||||||
| 60,688,110 shares outstanding in 2025 and 60,746,745 shares outstanding in 2024. | 723 | 723 | |||||||||
| Class B: $.01 par value; 662,300 shares authorized; | |||||||||||
| 574,903 shares issued and outstanding in both 2025 and 2024. | 6 | 6 | |||||||||
| Additional paid-in capital | 208,650 | 222,039 | |||||||||
| Retained earnings | 2,041,622 | 2,022,265 | |||||||||
| Accumulated other comprehensive loss | (1,612 | ) | (1,453 | ) | |||||||
| Treasury stock; at cost, 11,615,118 shares in 2025 and 11,556,483 shares in 2024 | (600,886 | ) | (598,583 | ) | |||||||
| Total Hub Group, Inc. equity | 1,648,503 | 1,644,997 | |||||||||
| Non-controlling interests | 47,696 | 46,954 | |||||||||
| TOTAL STOCKHOLDERS' EQUITY | 1,696,199 | 1,691,951 | |||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 2,821,525 | $ | 2,868,343 | |||||||
| HUB GROUP, INC. | |||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (in thousands) | |||||||||||
| (unaudited) | |||||||||||
| Three Months Ended March 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 27,194 | $ | 27,053 | |||||||
| Adjustments to reconcile net income | |||||||||||
| to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization of intangibles and right-of-use assets | 47,046 | 49,605 | |||||||||
| Deferred taxes | (2,054 | ) | (3,025 | ) | |||||||
| Non-cash share-based compensation expense | 4,653 | 4,040 | |||||||||
| Gain on sale of assets, net | (65 | ) | (498 | ) | |||||||
| Changes in operating assets and liabilities, net of acquisitions: | |||||||||||
| Restricted investments | 2,153 | 370 | |||||||||
| Accounts receivable, net | 13,567 | 9,652 | |||||||||
| Prepaid taxes | 5,942 | 7,253 | |||||||||
| Prepaid expenses and other current assets | 10,232 | 12,468 | |||||||||
| Other non-current assets | (3,326 | ) | (880 | ) | |||||||
| Accounts payable | (13,532 | ) | (24,755 | ) | |||||||
| Accrued expenses | (10,446 | ) | 11,462 | ||||||||
| Non-current liabilities | (11,329 | ) | (12,229 | ) | |||||||
| Net cash provided by operating activities | 70,035 | 80,516 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Proceeds from sale of equipment | 3,625 | 3,442 | |||||||||
| Purchases of property and equipment | (19,190 | ) | (17,524 | ) | |||||||
| Net cash used in investing activities | (15,565 | ) | (14,082 | ) | |||||||
| Cash flows from financing activities: | |||||||||||
| Repayments of long term debt | (26,379 | ) | (27,422 | ) | |||||||
| Purchase of treasury stock | (13,814 | ) | (25,756 | ) | |||||||
| Dividends paid | (7,500 | ) | (8,486 | ) | |||||||
| Stock withheld for payments of withholding taxes | (6,531 | ) | (7,626 | ) | |||||||
| Finance lease payments | (163 | ) | (606 | ) | |||||||
| Proceeds from issuance of debt | 14,072 | 11,550 | |||||||||
| Net cash used in financing activities | (40,315 | ) | (58,346 | ) | |||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 7 | 4 | |||||||||
| Net increase in cash, cash equivalents and restricted cash | 14,162 | 8,092 | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 126,948 | 187,270 | |||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 141,110 | $ | 195,362 | |||||||
| HUB GROUP, INC. | |||||||
| FINANCIAL INFORMATION BY SEGMENT | |||||||
| (in thousands) | |||||||
| (unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| Operating Revenue | 2025 | 2024 | |||||
| Intermodal and Transportation Services | $ | 530,022 | $ | 552,033 | |||
| Logistics | 411,001 | 480,224 | |||||
| Inter-segment eliminations | (25,807 | ) | (32,764 | ) | |||
| Total operating revenue | $ | 915,216 | $ | 999,493 | |||
| Three Months Ended March 31, | |||||||
| Operating Income | 2025 | 2024 | |||||
| Intermodal and Transportation Services | $ | 14,049 | $ | 13,031 | |||
| Logistics | 23,289 | 24,108 | |||||
| Total operating income | $ | 37,338 | $ | 37,139 | |||
| Three Months Ended March 31, | |||||||
| Depreciation and Amortization | 2025 | 2024 | |||||
| Intermodal and Transportation Services | $ | 22,025 | $ | 27,049 | |||
| Logistics | 10,553 | 11,282 | |||||
| Total depreciation and amortization | $ | 32,578 | $ | 38,331 | |||
| RECONCILIATION OF NET INCOME TO EBITDA (1) AND NET DEBT / EBITDA LEVERAGE | ||||||||||||||
| (in thousands) | ||||||||||||||
| (unaudited) | ||||||||||||||
| 2024 | 2024 | 2024 | 2025 | |||||||||||
| Q2 | Q3 | Q4 | Q1 | LTM | ||||||||||
| Net Income | $ | 29,015 | $ | 23,603 | $ | 24,372 | $ | 27,194 | $ | 104,184 | ||||
| Interest Expense, net | 1,881 | 1,333 | 1,858 | 1,992 | 7,064 | |||||||||
| Depreciation and Amortization (2) | 49,495 | 46,374 | 47,088 | 47,046 | 190,003 | |||||||||
| Provision for Income Taxes | 8,566 | 7,140 | 5,387 | 8,447 | 29,540 | |||||||||
| EBITDA | $ | 88,957 | $ | 78,450 | $ | 78,705 | $ | 84,679 | $ | 330,791 | ||||
| Network Alignment (i) | $ | - | $ | 8,381 | $ | 4,814 | $ | - | $ | 13,195 | ||||
| Transaction Related (ii) | - | 947 | 1,194 | - | 2,141 | |||||||||
| Other (iii) | - | 1,061 | 67 | - | 1,128 | |||||||||
| Adjusted EBITDA | $ | 88,957 | $ | 88,839 | $ | 84,780 | $ | 84,679 | $ | 347,255 | ||||
| EBITDA | $ | 330,791 | ||||||||||||
| Net Debt (3) | $ | 140,223 | ||||||||||||
| Net Debt / EBITDA | 0.4 | |||||||||||||
| (1) By providing this Non-GAAP measure of EBITDA and Net Debt / EBITDA Leverage, management intends to provide investors with a meaningful, consistent comparison of the Company's profitability and leverage for the periods presented. | ||||||||||||||
| (2) Includes depreciation of property and equipment, amortization of intangible assets and amortization of right-of-use assets. | ||||||||||||||
| (3) Total debt (including finance leases) less cash and cash equivalents. | ||||||||||||||
| (i) Network alignment expenses include transfer costs, legal fees and other expenses related to consolidating from existing warehouses to improve operational efficiency of our cross dock services, Final Mile and Consolidation and Fulfillment lines of business. | ||||||||||||||
| (ii) Transaction related expenses are comprised of due diligence costs, legal fees, insurance fees and other professional service fees incurred as part of the forming of a joint venture with EASO in 2024. | ||||||||||||||
| (iii) Other includes non-ordinary expenses related to employee matters. | ||||||||||||||
