Marten posts higher 4Q net income, lower operating revenue

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Marten Transport announced Tuesday, Jan. 27, its financial and operating results for the quarter and year ended Dec. 31. For the fourth quarter, net income increased 96.4 percent to $5.8 million compared with $3.0 million for the same quarter of 2007. For 2008, net income increased 20.7 percent to $18.1 million compared with $15.0 million for 2007.

Operating revenue, consisting of revenue from truckload and logistics operations, decreased 3.1 percent to $140.4 million in the fourth quarter from $144.8 million. For 2008, operating revenue increased 8.4 percent to $607.1 million from $560.0 million. Truckload revenue decreased 5.9 percent to $115.9 million in the fourth quarter from $123.2 million. For 2008, truckload revenue increased 3.6 percent to $508.2 million from $490.5 million. Logistics revenue, which consists of revenue from brokerage and intermodal operations, increased 12.9 percent to $24.4 million in the fourth quarter from $21.6 million. For 2008, logistics revenue increased 42.4 percent to $98.9 million from $69.5 million.

Operating revenue included fuel surcharges of $23.2 million and $132.6 million for the fourth quarter and yearly periods of 2008, compared with $26.0 million and $87.1 million. Operating revenue, net of fuel surcharges, decreased 1.4 percent to $117.1 million in the 2008 quarter from $118.8 million and increased by 0.3 percent to $474.5 million for 2008 from $472.9 million.

“Our ability to produce favorable results within an unfavorable freight environment was clearly demonstrated in the fourth quarter,” said Randolph L. Marten, chairman and chief executive officer of the Mondovi, Wis.-based company. “We continued our disciplined focus on superior customer service, profitable freight selection and aggressive cost controls.”

Marten said the company continued to increase the density in its regional markets, allowing for a shorter length of haul and overall reduced expenses. “While our rates per mile in our regional operations tend to be higher, the overall transportation cost to our customers is lower as a result of their trending toward regional distribution,” he said. Marten said that in the fourth quarter, the company witnessed an exodus of capacity as independent contractors left the market and some of the smaller carriers failed, which impacted the mix of company and independent contractor miles.

Marten said the company’s “already strong” balance sheet grew even stronger throughout 2008. “We continue to be well-positioned for an economic recovery,” he said. “Our disciplined approach to controlling our operating expenses has allowed us to increase free cash flow to pay down debt. Over the last year we’ve paid down $41.8 million in debt in order to ensure that we retain the liquidity needed to weather the current economic downturn. At Dec. 31, 2008, our balance sheet reflected approximately $255.7 million in stockholders’ equity and $2.9 million in debt, for a debt-to-capitalization ratio of approximately 1.1 percent, with the lowest level of debt since before our initial public offering in 1986.”

Martin anticipates net capital expenditures of $40 million to $60 million in 2009, which he said the company will adjust throughout the year as it sizes its fleet to existing customer demand. “Lastly, I gratefully acknowledge the people of Marten Transport who remain one of Marten’s key strategic strengths and who executed our multifaceted business model very well within the difficult operating conditions of 2008,” he said.