MRTN Marten Transport Ltd

Marten Transport, Ltd. (Nasdaq/GS:MRTN) today reported net income of $12.4 million, or 15 cents per diluted share, for the fourth quarter ended December 31, 2023, compared with $25.5 million, or 31 cents per diluted share, for the fourth quarter of 2022. For the year ended December 31, 2023, net income was $70.4 million, or 86 cents per diluted share, compared with $110.4 million, or $1.35 per diluted share, for 2022.

Operating revenue was $268.2 million for the fourth quarter of 2023 compared with $322.6 million for the fourth quarter of 2022. Excluding fuel surcharges, operating revenue was $229.4 million for the 2023 quarter compared with $269.7 million for the 2022 quarter. Fuel surcharge revenue decreased to $38.8 million for the 2023 quarter from $52.9 million for the 2022 quarter.

Operating revenue was $1.131 billion for 2023 compared with $1.264 billion for 2022. Excluding fuel surcharges, operating revenue was $972.0 million for 2023 compared with $1.053 billion for 2022. Fuel surcharge revenue decreased to $159.4 million for 2023 from $210.4 million for 2022.

Operating income was $15.7 million for the fourth quarter of 2023 compared with $32.8 million for the fourth quarter of 2022. Operating income was $90.1 million for 2023 compared with $143.3 million for 2022.

Operating expenses as a percentage of operating revenue were 94.2% for the 2023 quarter and 89.8% for the 2022 quarter. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 93.2% for the 2023 quarter and 87.8% for the 2022 quarter.

Operating expenses as a percentage of operating revenue were 92.0% for 2023 and 88.7% for 2022. Operating expenses as a percentage of operating revenue, with both amounts net of fuel surcharges, were 90.7% for 2023 and 86.4% for 2022.

Executive Chairman Randolph L. Marten stated, “This quarter’s earnings were heavily pressured by the freight market recession’s weak demand and oversupply, inflationary operating costs, and cumulative impact of decreased freight rates leading to freight network disruptions. Additionally, our higher insurance and claims and health insurance expense and less revenue equipment gains reduced our operating income by $4.8 million, or 4.4 cents per diluted share, from this year’s third quarter.”

“We remain focused on both minimizing the freight market’s impact on our operations, and investing in and positioning our operations to capitalize on profitable organic growth opportunities as the market moves toward equilibrium from its current recessionary late stages - with fair compensation for our premium services. Accordingly, we have not agreed to any rate reductions since last August.”

Current Investor Presentation

Marten Transport, with headquarters in Mondovi, Wis., is a multifaceted business offering a network of refrigerated and dry truck-based transportation capabilities across Marten’s five distinct business platforms - Truckload, Dedicated, Intermodal, Brokerage and MRTN de Mexico. Marten is one of the leading temperature-sensitive truckload carriers in the United States, specializing in transporting and distributing food, beverages and other consumer packaged goods that require a temperature-controlled or insulated environment. The Company offers service in the United States, Mexico and Canada, concentrating on expedited movements for high-volume customers. Marten’s common stock is traded on the Nasdaq Global Select Market under the symbol MRTN.

This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include a discussion of Marten’s prospects for future growth and by their nature involve substantial risks and uncertainties, and actual results may differ materially from those expressed in such forward-looking statements. Important factors known to the Company that could cause actual results to differ materially from those discussed in the forward-looking statements are discussed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The Company undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events or otherwise.

CONTACTS: Tim Kohl, Chief Executive Officer, Doug Petit, President, and Jim Hinnendael, Executive Vice President and Chief Financial Officer, of Marten Transport, Ltd., 715-926-4216.

MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED BALANCE SHEETS
	December 31,				December 31,
(In thousands, except share information)	2023				2022
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	53,213			$	80,600
Receivables:
Trade, net		105,501				120,702
Other		10,356				7,218
Prepaid expenses and other		27,512				27,320
Total current assets		196,582				235,840
Property and equipment:
Revenue equipment, buildings and land, office equipment and other		1,162,336				1,074,832
Accumulated depreciation		(370,103	)			(346,665	)
Net property and equipment		792,233				728,167
Other noncurrent assets		1,524				1,672
Total assets	$	990,339			$	965,679
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	36,516			$	37,299
Insurance and claims accruals		47,017				45,747
Accrued and other current liabilities		26,709				41,264
Total current liabilities		110,242				124,310
Deferred income taxes		122,462				137,041
Noncurrent operating lease liabilities		249				409
Total liabilities		232,953				261,760
Stockholders’ equity:
Preferred stock, $.01 par value per share; 2,000,000 shares authorized; no shares issued and outstanding		-				-
Common stock, $.01 par value per share; 192,000,000 shares authorized; 81,312,168 shares at December 31, 2023, and 81,115,132 shares at December 31, 2022, issued and outstanding		813				811
Additional paid-in capital		49,789				47,188
Retained earnings		706,784				655,920
Total stockholders’ equity		757,386				703,919
Total liabilities and stockholders’ equity	$	990,339			$	965,679

MARTEN TRANSPORT, LTD.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months								Year
	Ended December 31,								Ended December 31,
(In thousands, except per share information)	2023				2022				2023				2022
Operating revenue	$	268,222			$	322,584			$	1,131,455			$	1,263,878
Operating expenses (income):
Salaries, wages and benefits		91,350				104,722				378,818				390,304
Purchased transportation		47,259				60,599				199,334				249,792
Fuel and fuel taxes		42,731				55,567				180,437				218,571
Supplies and maintenance		16,120				15,180				67,411				55,700
Depreciation		28,748				29,625				116,722				111,014
Operating taxes and licenses		2,708				2,712				11,053				10,763
Insurance and claims		15,209				12,417				56,014				50,513
Communications and utilities		2,524				2,538				10,149				9,177
Gain on disposition of revenue equipment		(1,802	)			(2,957	)			(13,612	)			(13,379	)
Other		7,718				9,398				35,019				38,079
Total operating expenses		252,565				289,801				1,041,345				1,120,534
Operating income		15,657				32,783				90,110				143,344
Other		(868	)			(520	)			(3,806	)			(827	)
Income before income taxes		16,525				33,303				93,916				144,171
Income taxes expense		4,126				7,789				23,543				33,817
Net income	$	12,399			$	25,514			$	70,373			$	110,354
Basic earnings per common share	$	0.15			$	0.31			$	0.87			$	1.35
Diluted earnings per common share	$	0.15			$	0.31			$	0.86			$	1.35
Dividends declared per common share	$	0.06			$	0.06			$	0.24			$	0.24

        

MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
									Dollar				Percentage
									Change				Change
	Three Months								Three Months				Three Months
	Ended								Ended				Ended
	December 31,								December 31,				December 31,
(Dollars in thousands)	2023				2022				2023 vs. 2022				2023 vs. 2022
Operating revenue:
Truckload revenue, net of fuel surcharge revenue	$	95,461			$	108,565			$	(13,104	)			(12.1	)%
Truckload fuel surcharge revenue		18,023				22,759				(4,736	)			(20.8	)
Total Truckload revenue		113,484				131,324				(17,840	)			(13.6	)
Dedicated revenue, net of fuel surcharge revenue		77,731				87,985				(10,254	)			(11.7	)
Dedicated fuel surcharge revenue		17,310				23,775				(6,465	)			(27.2	)
Total Dedicated revenue		95,041				111,760				(16,719	)			(15.0	)
Intermodal revenue, net of fuel surcharge revenue		15,610				22,863				(7,253	)			(31.7	)
Intermodal fuel surcharge revenue		3,467				6,390				(2,923	)			(45.7	)
Total Intermodal revenue		19,077				29,253				(10,176	)			(34.8	)
Brokerage revenue		40,620				50,247				(9,627	)			(19.2	)
Total operating revenue	$	268,222			$	322,584			$	(54,362	)			(16.9	)%
Operating income:
Truckload	$	2,487			$	13,414			$	(10,927	)			(81.5	)%
Dedicated		9,234				12,877				(3,643	)			(28.3	)
Intermodal		296				728				(432	)			(59.3	)
Brokerage		3,640				5,764				(2,124	)			(36.8	)
Total operating income	$	15,657			$	32,783			$	(17,126	)			(52.2	)%
Operating ratio:
Truckload		97.8	%			89.8	%
Dedicated		90.3				88.5
Intermodal		98.4				97.5
Brokerage		91.0				88.5
Consolidated operating ratio		94.2	%			89.8	%
Operating ratio, net of fuel surcharges:
Truckload		97.4	%			87.6	%
Dedicated		88.1				85.4
Intermodal		98.1				96.8
Brokerage		91.0				88.5
Consolidated operating ratio, net of fuel surcharges		93.2	%			87.8	%

MARTEN TRANSPORT, LTD.
SEGMENT INFORMATION
(Unaudited)
									Dollar				Percentage
									Change				Change
	Year								Year				Year
	Ended								Ended				Ended
	December 31,								December 31,				December 31,
(Dollars in thousands)	2023				2022				2023 vs. 2022				2023 vs. 2022
Operating revenue:
Truckload revenue, net of fuel surcharge revenue	$	395,565			$	411,448			$	(15,883	)			(3.9	)%
Truckload fuel surcharge revenue		69,910				89,014				(19,104	)			(21.5	)
Total Truckload revenue		465,475				500,462				(34,987	)			(7.0	)
Dedicated revenue, net of fuel surcharge revenue		334,962				336,973				(2,011	)			(0.6	)
Dedicated fuel surcharge revenue		73,310				92,119				(18,809	)			(20.4	)
Total Dedicated revenue		408,272				429,092				(20,820	)			(4.9	)
Intermodal revenue, net of fuel surcharge revenue		75,887				100,452				(24,565	)			(24.5	)
Intermodal fuel surcharge revenue		16,191				29,313				(13,122	)			(44.8	)
Total Intermodal revenue		92,078				129,765				(37,687	)			(29.0	)
Brokerage revenue		165,630				204,559				(38,929	)			(19.0	)
Total operating revenue	$	1,131,455			$	1,263,878			$	(132,423	)			(10.5	)%
Operating income/(loss):
Truckload	$	24,835			$	59,392			$	(34,557	)			(58.2	)%
Dedicated		48,377				50,566				(2,189	)			(4.3	)
Intermodal		(156	)			10,639				(10,795	)			(101.5	)
Brokerage		17,054				22,747				(5,693	)			(25.0	)
Total operating income	$	90,110			$	143,344			$	(53,234	)			(37.1	)%
Operating ratio:
Truckload		94.7	%			88.1	%
Dedicated		88.2				88.2
Intermodal		100.2				91.8
Brokerage		89.7				88.9
Consolidated operating ratio		92.0	%			88.7	%
Operating ratio, net of fuel surcharges:
Truckload		93.7	%			85.6	%
Dedicated		85.6				85.0
Intermodal		100.2				89.4
Brokerage		89.7				88.9
Consolidated operating ratio, net of fuel surcharges		90.7	%			86.4	%

MARTEN TRANSPORT, LTD.
OPERATING STATISTICS
(Unaudited)
	Three Months								Year
	Ended December 31,								Ended December 31,
	2023				2022				2023				2022
Truckload Segment:
Revenue (in thousands)	$	113,484			$	131,324			$	465,475			$	500,462
Average revenue, net of fuel surcharges, per tractor per week(1)	$	4,183			$	4,683			$	4,377			$	4,898
Average tractors(1)		1,737				1,763				1,733				1,611
Average miles per trip		533				504				519				510
Non-revenue miles percentage(2)		12.4	%			11.9	%			12.4	%			11.1	%
Total miles (in thousands)		39,278				39,303				155,929				149,868
Dedicated Segment:
Revenue (in thousands)	$	95,041			$	111,760			$	408,272			$	429,092
Average revenue, net of fuel surcharges, per tractor per week(1)	$	3,895			$	3,925			$	3,936			$	3,963
Average tractors(1)		1,518				1,706				1,632				1,631
Average miles per trip		335				345				335				341
Non-revenue miles percentage(2)		1.2	%			1.1	%			1.2	%			1.1	%
Total miles (in thousands)		31,215				34,910				133,163				136,310
Intermodal Segment:
Revenue (in thousands)	$	19,077			$	29,253			$	92,078			$	129,765
Loads		5,289				7,255				25,160				31,862
Average tractors		133				181				159				175
Brokerage Segment:
Revenue (in thousands)	$	40,620			$	50,247			$	165,630			$	204,559
Loads		23,594				25,713				91,077				95,615
At December 31, 2023 and December 31, 2022:
Total tractors(1)		3,349				3,660
Average age of company tractors (in years)		1.9				1.7
Total trailers		5,653				5,753
Average age of company trailers (in years)		4.6				3.9
Ratio of trailers to tractors(1)		1.7				1.6
Total refrigerated containers		787				802

	Three Months								Year
	Ended December 31,								Ended December 31,
(In thousands)	2023				2022				2023				2022
Net cash provided by operating activities	$	38,045			$	56,268			$	164,378			$	219,489
Net cash (used for) investing activities		(48,070	)			(42,542	)			(172,540	)			(134,958	)
Net cash (used for) financing activities		(4,829	)			(4,618	)			(19,225	)			(60,926	)
Weighted average shares outstanding:
Basic		81,309				81,105				81,272				81,692
Diluted		81,418				81,391				81,413				81,959

(1	)	Includes tractors driven by both company-employed drivers and independent contractors. Independent contractors provided 94 and 96 tractors as of December 31, 2023 and 2022, respectively.
(2	)	Represents the percentage of miles for which the company is not compensated.