ArcBest® Announces Record Third Quarter 2021 Results

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Investor Relations Contact: David Humphrey

Title: Vice President – Investor Relations

Phone: 479-785-6200 

Email: dhumphrey@arcb.com

 

ArcBest® Announces Record Third Quarter 2021 Results

Successful growth strategy driving superior performance

Advancing strategic vision to better serve customers
and further enhance value for shareholders

 

  • Third quarter 2021 revenue of $1.0 billion increased 27.9 percent over third quarter 2020.
  • Net income improved to $63.7 million, or $2.38 per diluted share. On a non-GAAP basis, third quarter 2021 net income was $69.2 million, or $2.59 per diluted share.
  • Highest quarterly revenue and operating income in ArcBest’s history.

 

FORT SMITH, Ark., November 2, 2021 — ArcBest® (Nasdaq: ARCB), a leader in supply chain logistics, today reported third quarter 2021 revenue of $1.0 billion compared to third quarter 2020 revenue of $795.0 million. Each of ArcBest’s operating segments achieved double-digit percentage revenue growth over the prior year. ArcBest’s third quarter 2021 operating income was $87.6 million and net income was $63.7 million, or $2.38 per diluted share, compared to third quarter 2020 operating income of $39.8 million and net income of $29.4 million, or $1.11 per diluted share.

Excluding certain items in both periods as identified in the attached reconciliation tables, non-GAAP operating income was $96.1 million in third quarter 2021 compared to $45.8 million in the prior year period. On a non-GAAP basis, net income was $69.2 million, or $2.59 per diluted share, in third quarter 2021 compared to $32.4 million, or $1.22 per diluted share, in third quarter 2020.

“ArcBest continues to capitalize on the power of our integrated solutions to respond to today’s rapidly evolving market environment,” said Judy R. McReynolds, ArcBest chairman, president and CEO. “Our strategic vision, which is centered on accelerating growth through targeted investments in innovation, technology, logistics solutions and our people, continues to pay off. Furthering these efforts, yesterday’s closing of the MoLo Solutions acquisition is expected to build and amplify our powerful portfolio of shipping and logistics services to help our customers drive the economy forward and unlock incremental value for our shareholders.

McReynolds added, We wouldn’t be where we are today – announcing record quarterly results – without ArcBest’s talented and committed people, who are at the heart of our success. Our proven ability to operate safely and efficiently while advancing our strategic vision and generating strong financial results is due to our team’s consistency and the trusted relationships they have built with our customers. Looking ahead, we are focused on continuing to successfully execute our growth strategy and creating sustainable value for our stakeholders, including our shareholders.”

 

Third Quarter Results of Operations Comparisons

Asset-Based

Third Quarter 2021 Versus Third Quarter 2020

  • Revenue of $681.2 million compared to $561.9 million, a per-day increase of 21.2 percent.
  • Total tonnage per day increase of 2.4 percent, including an increase of 2.5 percent in LTL-rated weight per shipment.
  • Total shipments per day increase of 0.5 percent.
  • Total billed revenue per hundredweight increased 17.1 percent and was positively impacted by higher fuel surcharges. Revenue per hundredweight on LTL-rated business, excluding fuel surcharge, improved by a percentage in the double digits.
  • Operating income of $83.6 million and an operating ratio of 87.7 percent compared to the prior-year quarter operating income of $36.6 million and an operating ratio of 93.5 percent. On a non-GAAP basis, operating income of $90.5 million and an operating ratio of 86.7 percent compared to the prior-year quarter operating income of $42.8 million and an operating ratio of 92.4 percent.

Strong shipper demand and a solid pricing environment coupled with ArcBest’s deep understanding of customer needs resulted in the third record-setting quarter in a row this year for ArcBest’s Asset-Based business. Year-over-year tonnage and shipment growth was the result of an emphasis on allocating network resources to serving core LTL customers. Shippers have continued to benefit from ArcBest’s assets and facilities throughout its Asset-Based network being used to help solve supply chain challenges. Third quarter 2021 operating income more than doubled compared to the prior-year period and reflected a healthy sequential increase compared to the recent second quarter.

Asset-Light

Third Quarter 2021 Versus Third Quarter 2020

  • Revenue of $371.7 million compared to $267.8 million, a per-day increase of 38.8 percent.
  • Operating income of $11.5 million compared to the prior-year quarter operating income of $5.8 million.
  • Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) of $14.2 million compared to the prior-year quarter Adjusted EBITDA of $8.6 million, as detailed in the attached non-GAAP reconciliation tables.

Positive momentum in the ArcBest segment continued in the third quarter with record-setting quarterly revenue and operating income. The ability to positively respond to strong customer demand with innovative solutions contributed to solid revenue growth in the ArcBest segment. Increased demand for expedited and truckload logistics services resulted in higher shipment levels and higher average revenue per shipment. Customers’ needs for managed transportation solutions also contributed to third quarter revenue growth and improved operating results. The increase in operating income reflects the benefits of higher revenue, partially offset by increased personnel costs in response to shipment growth and continued investments in technology.

Increased business volume combined with higher revenue per event contributed to record quarterly revenue for the FleetNet segment and an increase in operating income over the prior year’s third quarter.

 

 

NOTE

 ‡ - The ArcBest and FleetNet reportable segments, combined, represent Asset-Light operations

Conference Call

ArcBest will host a conference call with company executives to discuss the 2021 third quarter results. The call will be today, Tuesday, November 2, at 9:30 a.m. EDT (8:30 a.m. CDT). Interested parties are invited to listen by calling (800) 669-4993 or by joining the webcast which can be found on ArcBest’s website at arcb.com. Slides to accompany this call are included in Exhibit 99.3 of the Form 8-K filed on November 2, 2021, will be posted and available to download on the company’s website prior to the scheduled conference time, and will be included in the webcast. Following the call, a recorded playback will be available through the end of the day on December 15, 2021. To listen to the playback, dial (800) 633‑8284 or (402) 977‑9140 (for international callers). The conference call ID for the playback is 21998422. The conference call and playback can also be accessed, through December 15, 2021, on ArcBest’s website at arcb.com.

About ArcBest

ArcBest® (Nasdaq: ARCB) is a multibillion-dollar integrated logistics company that helps keep the global supply chain moving. Founded in 1923 and now with over 14,000 employees across more than 250 campuses and service centers, the company is a logistics powerhouse, fueled by the simple notion of finding a way to get the job done. Through innovative thinking, agility and trust, ArcBest leverages their full suite of shipping and logistics solutions to meet customers’ critical needs, each and every day. For more information, visit arcb.com.

The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995:  Certain statements and information in this press release concerning results for the three months ended September 30, 2021 may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “foresee,” “int end,” “may,” “plan,” “predict,” “project,” “scheduled,” “should,” “would,” and similar expressions and the negatives of such terms are intended to identify forward-looking statements. These statements are based on management’s beliefs, assumptions, and expectations based on currently available information, are not guarantees of future performance, and involve certain risks and uncertainties (some of which are beyond our control). Although we believe that the expectations reflected in these forward-looking statements are reasonable as and when made, we cannot provide assurance that our expectations will prove to be correct. Actual outcomes and results could materially differ from what is expressed, implied, or forecasted in these statements due to a number of factors, including, but not limited to: widespread outbreak of an illness or disease, including the COVID-19 pandemic and its effects, or any other public health crisis, as well as regulatory measures implemented in response to such events; external events which may adversely affect us or the third parties who provide services for us, for which our business continuity plans may not adequately prepare us; a failure of our information systems, including disruptions or failures of services essential to our operations or upon which our information technology platforms rely, data breach, and/or cybersecurity incidents; interruption or failure of third-party software or information technology systems or licenses; untimely or ineffective development and implementation of, or failure to realize potential benefits associated with, new or enhanced technology or processes, including the pilot test program at ABF Freight; the loss or reduction of business from large customers; the ability to manage our cost structure, and the timing and performance of growth initiatives; the cost, integration, and performance of any recent or future acquisitions, including the MoLo acquisition, and the inability to realize the anticipated benefits of the acquisition within the expected time period or at all; the timing or amount of the earnout payments for the MoLo acquisition, if any; maintaining our corporate reputation and intellectual property rights; competitive initiatives and pricing pressures; increased prices for and decreased availability of new revenue equipment, decreases in value of used revenue equipment, and higher costs of equipment-related operating expenses such as maintenance, fuel, and related taxes; availability of fuel, the effect of volatility in fuel prices and the associated changes in fuel surcharges on securing increases in base freight rates, and the inability to collect fuel surcharges; relationships with employees, including unions, and our ability to attract, retain, and develop employees; unfavorable terms of, or the inability to reach agreement on, future collective bargaining agreements or a workforce stoppage by our employees covered under ABF Freight’s collective bargaining agreement; union employee wages and benefits, including changes in required contributions to multiemployer plans; availability and cost of reliable third-party services; our ability to secure independent owner operators and/or operational or regulatory issues related to our use of their services; litigation or claims asserted against us; governmental regulations; environmental laws and regulations, including emissions-control regulations; default on covenants of financing arrangements and the availability and terms of future financing arrangements; self-insurance claims and insurance premium costs; potential impairment of goodwill and intangible assets; general economic conditions and related shifts in market demand that impact the performance and needs of industries we serve and/or limit our customers’ access to adequate financial resources; seasonal fluctuations and adverse weather conditions; and other financial, operational, and legal risks and uncertainties detailed from time to time in ArcBest Corporation’s public filings with the Securities and Exchange Commission (the “SEC”).

For additional information regarding known material factors that could cause our actual results to differ from our projected results, please see our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statements after the date they are made, whether as a result of new information, future events, or otherwise.

 

 

Financial Data and Operating Statistics

The following tables show financial data and operating statistics on ArcBest® and its reportable segments.

 

ARCBEST CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended 

 

Nine Months Ended 

 

 

 

September 30

 

September 30

 

 

    

2021

    

2020

    

2021

    

2020

 

 

 

(Unaudited)

 

 

 

($ thousands, except share and per share data)

 

REVENUES

 

$

 1,016,657

 

$

 794,980

 

$

 2,794,843

 

$

 2,123,749

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 929,096

 

 

 755,198

 

 

 2,600,792

 

 

 2,055,723

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING INCOME

 

 

 87,561

 

 

 39,782

 

 

 194,051

 

 

 68,026

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (COSTS)

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income

 

 

 323

 

 

 756

 

 

 1,037

 

 

 3,122

 

Interest and other related financing costs

 

 

 (2,072)

 

 

 (2,860)

 

 

 (6,774)

 

 

 (9,185)

 

Other, net

 

 

 338

 

 

 1,500

 

 

 2,641

 

 

 334

 

 

 

 

 (1,411)

 

 

 (604)

 

 

 (3,096)

 

 

 (5,729)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

 

 

 86,150

 

 

 39,178

 

 

 190,955

 

 

 62,297

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME TAX PROVISION

 

 

 22,459

 

 

 9,774

 

 

 42,922

 

 

 15,111

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME

 

$

 63,691

 

$

 29,404

 

$

 148,033

 

$

 47,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS PER COMMON SHARE

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

 2.48

 

$

 1.15

 

$

 5.79

 

$

 1.86

 

Diluted

 

$

 2.38

 

$

 1.11

 

$

 5.51

 

$

 1.79

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE COMMON SHARES OUTSTANDING

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 25,632,805

 

 

 25,470,094

 

 

 25,559,642

 

 

 25,403,786

 

Diluted

 

 

 26,770,146

 

 

 26,592,457

 

 

 26,872,381

 

 

 26,289,946

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CASH DIVIDENDS DECLARED PER COMMON SHARE

 

$

 0.08

 

$

 0.08

 

$

 0.24

 

$

 0.24

 

 

 

ARCBEST CORPORATION

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

 

 

September 30

 

December 31

 

 

    

2021

    

2020

 

 

 

(Unaudited)

 

Note

 

 

 

($ thousands, except share data)

 

ASSETS

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

 408,207

 

$

 303,954

 

Short-term investments

 

 

 60,289

 

 

 65,408

 

Accounts receivable, less allowances (2021 - $6,847; 2020 - $7,851)

 

 

 425,006

 

 

 320,870

 

Other accounts receivable, less allowances (2021 - $671; 2020 - $660)

 

 

 13,827

 

 

 14,343

 

Prepaid expenses

 

 

 30,120

 

 

 37,774

 

Prepaid and refundable income taxes

 

 

 9,258

 

 

 11,397

 

Other

 

 

 6,419

 

 

 4,422

 

TOTAL CURRENT ASSETS

 

 

 953,126

 

 

 758,168

 

 

 

 

 

 

 

 

 

PROPERTY, PLANT AND EQUIPMENT

 

 

 

 

 

 

 

Land and structures

 

 

 347,771

 

 

 342,178

 

Revenue equipment

 

 

 965,263

 

 

 916,760

 

Service, office, and other equipment

 

 

 243,601

 

 

 233,810

 

Software

 

 

 170,045

 

 

 163,193

 

Leasehold improvements

 

 

 15,970

 

 

 15,156

 

 

 

 

 1,742,650

 

 

 1,671,097

 

Less allowances for depreciation and amortization

 

 

 1,058,343

 

 

 992,407

 

 

 

 

 684,307

 

 

 678,690

 

 

 

 

 

 

 

 

 

GOODWILL

 

 

 86,368

 

 

 88,320

 

INTANGIBLE ASSETS, NET

 

 

 52,135

 

 

 54,981

 

OPERATING RIGHT-OF-USE ASSETS

 

 

 105,219

 

 

 115,195

 

DEFERRED INCOME TAXES

 

 

 6,544

 

 

 6,158

 

OTHER LONG-TERM ASSETS

 

 

 74,729

 

 

 77,496

 

 

 

$

 1,962,428

 

$

 1,779,008

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

Accounts payable

 

$

 227,893

 

$

 170,898

 

Income taxes payable

 

 

 6,535

 

 

 316

 

Accrued expenses

 

 

 291,586

 

 

 246,746

 

Current portion of long-term debt

 

 

 67,897

 

 

 67,105

 

Current portion of operating lease liabilities

 

 

 21,765

 

 

 21,482

 

TOTAL CURRENT LIABILITIES

 

 

 615,676

 

 

 506,547

 

 

 

 

 

 

 

 

 

LONG-TERM DEBT, less current portion

 

 

 176,545

 

 

 217,119

 

OPERATING LEASE LIABILITIES, less current portion

 

 

 88,232

 

 

 97,839

 

POSTRETIREMENT LIABILITIES, less current portion

 

 

 18,506

 

 

 18,555

 

OTHER LONG-TERM LIABILITIES

 

 

 38,208

 

 

 37,948

 

DEFERRED INCOME TAXES

 

 

 64,218

 

 

 72,407

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

Common stock, $0.01 par value, authorized 70,000,000 shares;
      issued 2021: 29,351,569 shares; 2020: 29,045,309 shares

 

 

 294

 

 

 290

 

Additional paid-in capital

 

 

 340,315

 

 

 342,354

 

Retained earnings

 

 

 737,820

 

 

 595,932

 

   Treasury stock, at cost, 2021: 3,783,227 shares; 2020: 3,656,938 shares

 

 

 (119,273)

 

 

 (111,173)

 

Accumulated other comprehensive income

 

 

 1,887

 

 

 1,190

 

TOTAL STOCKHOLDERS’ EQUITY

 

 

 961,043

 

 

 828,593

 

 

 

$

 1,962,428

 

$

 1,779,008

 

 

Note:  The balance sheet at December 31, 2020 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

 

 

 

ARCBEST CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended 

 

 

 

September 30

 

 

    

2021

    

2020

 

 

 

Unaudited

 

 

 

($ thousands)

 

 OPERATING ACTIVITIES

 

 

 

 

 

 

 

Net income

 

$

 148,033

 

$

 47,186

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 88,113

 

 

 85,189

 

Amortization of intangibles

 

 

 2,882

 

 

 2,942

 

Pension settlement expense

 

 

 —

 

 

 89

 

Share-based compensation expense

 

 

 8,567

 

 

 7,956

 

Provision for losses on accounts receivable

 

 

 (57)

 

 

 2,170

 

Change in deferred income taxes

 

 

 (8,593)

 

 

 2,831

 

Gain on sale of property and equipment and lease termination

 

 

 (8,389)

 

 

 (3,280)

 

Gain on sale of subsidiaries

 

 

 (6,923)

 

 

 —

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Receivables

 

 

 (103,886)

 

 

 (38,905)

 

Prepaid expenses

 

 

 7,655

 

 

 809

 

Other assets

 

 

 539

 

 

 3,918

 

Income taxes

 

 

 8,174

 

 

 3,065

 

Operating right-of-use assets and lease liabilities, net

 

 

 650

 

 

 234

 

Accounts payable, accrued expenses, and other liabilities

 

 

 101,577

 

 

 37,062

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

 

 238,342

 

 

 151,266

 

 

 

 

 

 

 

 

 

 INVESTING ACTIVITIES

 

 

 

 

 

 

 

Purchases of property, plant and equipment, net of financings

 

 

 (43,506)

 

 

 (20,146)

 

Proceeds from sale of property and equipment

 

 

 11,509

 

 

 8,943

 

Proceeds from sale of subsidiaries

 

 

 9,013

 

 

 —

 

Purchases of short-term investments

 

 

 (56,011)

 

 

 (159,253)

 

Proceeds from sale of short-term investments

 

 

 61,174

 

 

 192,563

 

Capitalization of internally developed software

 

 

 (14,308)

 

 

 (9,568)

 

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

 

 

 (32,129)

 

 

 12,539

 

 

 

 

 

 

 

 

 

 FINANCING ACTIVITIES

 

 

 

 

 

 

 

Borrowings under credit facilities

 

 

 —

 

 

 180,000

 

Borrowings under accounts receivable securitization program

 

 

 —

 

 

 45,000

 

Payments on long-term debt

 

 

 (76,513)

 

 

 (309,640)

 

Net change in book overdrafts

 

 

 (305)

 

 

 349

 

Deferred financing costs

 

 

 (295)

 

 

 —

 

Payment of common stock dividends

 

 

 (6,145)

 

 

 (6,122)

 

Purchases of treasury stock

 

 

 (8,100)

 

 

 (5,667)

 

Payments for tax withheld on share-based compensation

 

 

 (10,602)

 

 

 (1,989)

 

NET CASH USED IN FINANCING ACTIVITIES

 

 

 (101,960)

 

 

 (98,069)

 

 

 

 

 

 

 

 

 

NET INCREASE IN CASH AND CASH EQUIVALENTS

 

 

 104,253

 

 

 65,736

 

Cash and cash equivalents at beginning of period

 

 

 303,954

 

 

 201,909

 

CASH AND CASH EQUIVALENTS AT END OF PERIOD

 

$

 408,207

 

$

 267,645

 

 

 

 

 

 

 

 

 

 NONCASH INVESTING ACTIVITIES

 

 

 

 

 

 

 

Equipment financed

 

$

 36,731

 

$

 53,045

 

Accruals for equipment received

 

$

 3,158

 

$

 2,146

 

Lease liabilities arising from obtaining right-of-use assets

 

$

 7,280

 

$

 60,535

 

 

 

ARCBEST CORPORATION

FINANCIAL STATEMENT OPERATING SEGMENT DATA AND OPERATING RATIOS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended 

 

 

Nine Months Ended 

 

 

 

September 30

 

 

September 30

 

 

    

2021

    

 

2020

    

 

2021

    

 

2020

 

 

 

Unaudited

 

 

 

($ thousands, except percentages)

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Based

 

$

 681,164

 

 

 

 

$

 561,856

 

 

 

 

$

 1,890,288

 

 

 

 

$

 1,537,639

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ArcBest

 

 

 305,207

 

 

 

 

 

 217,294

 

 

 

 

 

 828,291

 

 

 

 

 

 533,536

 

 

 

FleetNet

 

 

 66,514

 

 

 

 

 

 50,545

 

 

 

 

 

 185,224

 

 

 

 

 

 149,424

 

 

 

Total Asset-Light

 

 

 371,721

 

 

 

 

 

 267,839

 

 

 

 

 

 1,013,515

 

 

 

 

 

 682,960

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other and eliminations

 

 

 (36,228)

 

 

 

 

 

 (34,715)

 

 

 

 

 

 (108,960)

 

 

 

 

 

 (96,850)

 

 

 

Total consolidated revenues

 

$

 1,016,657

 

 

 

 

$

 794,980

 

 

 

 

$

 2,794,843

 

 

 

 

$

 2,123,749

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Based

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries, wages, and benefits

 

$

 305,839

 

 44.9

%

 

$

 287,385

 

 51.2

%

 

$

 893,903

 

 47.3

%

 

$

 820,218

 

 53.3

%

Fuel, supplies, and expenses

 

 

 66,947

 

 9.8

 

 

 

 50,144

 

 8.9

 

 

 

 192,477

 

 10.2

 

 

 

 157,044

 

 10.2

 

Operating taxes and licenses

 

 

 12,426

 

 1.8

 

 

 

 12,296

 

 2.2

 

 

 

 36,977

 

 2.0

 

 

 

 36,719

 

 2.4

 

Insurance

 

 

 10,175

 

 1.5

 

 

 

 8,587

 

 1.5

 

 

 

 28,568

 

 1.5

 

 

 

 24,658

 

 1.6

 

Communications and utilities

 

 

 4,559

 

 0.7

 

 

 

 4,373

 

 0.8

 

 

 

 14,192

 

 0.7

 

 

 

 13,426

 

 0.9

 

Depreciation and amortization

 

 

 23,233

 

 3.4

 

 

 

 24,054

 

 4.3

 

 

 

 70,025

 

 3.7

 

 

 

 70,651

 

 4.6

 

Rents and purchased transportation

 

 

 95,855

 

 14.1

 

 

 

 69,442

 

 12.4

 

 

 

 266,525

 

 14.1

 

 

 

 171,364

 

 11.2

 

Shared services

 

 

 71,017

 

 10.4

 

 

 

 60,664

 

 10.8

 

 

 

 196,255

 

 10.4

 

 

 

 155,154

 

 10.1

 

Gain on sale of property and equipment(1)

 

 

 —

 

 —

 

 

 

 133

 

 —

 

 

 

 (8,624)

 

 (0.5)

 

 

 

 (3,206)

 

 (0.2)

 

Innovative technology costs(2)

 

 

 6,903

 

 1.0

 

 

 

 6,199

 

 1.1

 

 

 

 21,303

 

 1.1

 

 

 

 15,521

 

 1.0

 

Other

 

 

 592

 

 0.1

 

 

 

 1,933

 

 0.3

 

 

 

 1,103

 

 0.1

 

 

 

 5,168

 

 0.3

 

Total Asset-Based

 

 

 597,546

 

 87.7

%

 

 

 525,210

 

 93.5

%

 

 

 1,712,704

 

 90.6

%

 

 

 1,466,717

 

 95.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ArcBest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchased transportation

 

 

 256,900

 

 84.2

%

 

 

 181,129

 

 83.4

%

 

 

 694,498

 

 83.8

%

 

 

 443,401

 

 83.1

%

Supplies and expenses

 

 

 2,741

 

 0.9

 

 

 

 2,746

 

 1.3

 

 

 

 7,785

 

 0.9

 

 

 

 7,015

 

 1.3

 

Depreciation and amortization(3)

 

 

 2,352

 

 0.8

 

 

 

 2,413

 

 1.1

 

 

 

 7,104

 

 0.9

 

 

 

 7,332

 

 1.4

 

Shared services

 

 

 31,048

 

 10.2

 

 

 

 24,217

 

 11.1

 

 

 

 86,198

 

 10.4

 

 

 

 64,784

 

 12.1

 

Gain on sale of subsidiary(4)

 

 

 —

 

 —

 

 

 

 —

 

 —

 

 

 

 (6,923)

 

 (0.8)

 

 

 

 —

 

 —

 

Other

 

 

 1,984

 

 0.6

 

 

 

 1,958

 

 0.9

 

 

 

 6,055

 

 0.7

 

 

 

 6,279

 

 1.2

 

 

 

 

 295,025

 

 96.7

%

 

 

 212,463

 

 97.8

%

 

 

 794,717

 

 95.9

%

 

 

 528,811

 

 99.1

%

FleetNet

 

 

 65,245

 

 98.1

%

 

 

 49,558

 

 98.0

%

 

 

 181,794

 

 98.1

%

 

 

 146,615

 

 98.1

%

Total Asset-Light

 

 

 360,270

 

 

 

 

 

 262,021

 

 

 

 

 

 976,511

 

 

 

 

 

 675,426

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other and eliminations(5)

 

 

 (28,720)

 

 

 

 

 

 (32,033)

 

 

 

 

 

 (88,423)

 

 

 

 

 

 (86,420)

 

 

 

Total consolidated operating expenses

 

$

 929,096

 

 91.4

%

 

$

 755,198

 

 95.0

%

 

$

 2,600,792

 

 93.1

%

 

$

 2,055,723

 

 96.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Based

 

$

 83,618

 

 

 

 

$

 36,646

 

 

 

 

$

 177,584

 

 

 

 

$

 70,922

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ArcBest

 

 

 10,182

 

 

 

 

 

 4,831

 

 

 

 

 

 33,574

 

 

 

 

 

 4,725

 

 

 

FleetNet

 

 

 1,269

 

 

 

 

 

 987

 

 

 

 

 

 3,430

 

 

 

 

 

 2,809

 

 

 

Total Asset-Light

 

 

 11,451

 

 

 

 

 

 5,818

 

 

 

 

 

 37,004

 

 

 

 

 

 7,534

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other and eliminations(5)

 

 

 (7,508)

 

 

 

 

 

 (2,682)

 

 

 

 

 

 (20,537)

 

 

 

 

 

 (10,430)

 

 

 

Total consolidated operating income

 

$

 87,561

 

 

 

 

$

 39,782

 

 

 

 

$

 194,051

 

 

 

 

$

 68,026

 

 

 


  1. The nine months ended September 30, 2021 includes an $8.6 million gain on the sale of an unutilized service center property.
  2. Represents costs associated with the freight handling pilot test program at ABF Freight.
  3. Depreciation and amortization includes amortization of intangibles associated with acquired businesses.
  4. Gain relates to the sale of the labor services portion of the ArcBest segment’s moving business in second quarter 2021.
  5. “Other and eliminations” includes corporate costs for certain unallocated shared service costs which are not attributable to any segment, additional investments to offer comprehensive transportation and logistics services across multiple operating segments, and other investments in ArcBest technology and innovations, including innovative technology costs.

 

 

 

ARCBEST CORPORATION

RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES

 

Non-GAAP Financial Measures

We report our financial results in accordance with generally accepted accounting principles (“GAAP”). However, management believes that certain non-GAAP performance measures and ratios utilized for internal analysis provide analysts, investors, and others the same information that we use internally for purposes of assessing our core operating performance and provides meaningful comparisons between current and prior period results, as well as important information regarding performance trends. The use of certain non-GAAP measures improves comparability in analyzing our performance because it removes the impact of items from operating results that, in management's opinion, do not reflect our core operating performance. Other companies may calculate non-GAAP measures differently; therefore, our calculation may not be comparable to similarly titled measures of other companies. Certain information discussed in the scheduled conference call could be considered non-GAAP measures. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, our reported results. These financial measures should not be construed as better measurements than operating income, operating cash flow, net income or earnings per share, as determined under GAAP.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended 

 

Nine Months Ended 

 

 

September 30

 

 

September 30

 

 

    

2021

 

2020

    

  

2021

 

 

2020

 

ArcBest Corporation - Consolidated

 

(Unaudited)

 

 

 

($ thousands, except per share data)

 

Operating Income

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 87,561

 

$

 39,782

 

$

 194,051

 

$

 68,026

 

Innovative technology costs, pre-tax(1)

 

 

 6,893

 

 

 6,041

 

 

 21,235

 

 

 15,340

 

Gain on sale of subsidiary, pre-tax(2)

 

 

 —

 

 

 —

 

 

 (6,923)

 

 

 —

 

Transaction costs, pre-tax(3)

 

 

 1,607

 

 

 —

 

 

 1,607

 

 

 —

 

Non-GAAP amounts

 

$

 96,061

 

$

 45,823

 

$

 209,970

 

$

 83,366

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 63,691

 

$

 29,404

 

$

 148,033

 

$

 47,186

 

Innovative technology costs, after-tax (includes related financing costs)(1)

 

 

 5,236

 

 

 4,627

 

 

 16,139

 

 

 11,834

 

Gain on sale of subsidiary, after-tax(2)

 

 

 —

 

 

 —

 

 

 (5,437)

 

 

 —

 

Transaction costs, after-tax(3)

 

 

 1,187

 

 

 —

 

 

 1,187

 

 

 —

 

Nonunion pension expense, including settlement expense, after-tax(4)

 

 

 —

 

 

 —

 

 

 —

 

 

 66

 

Life insurance proceeds and changes in cash surrender value

 

 

 (394)

 

 

 (1,503)

 

 

 (2,908)

 

 

 (258)

 

Tax expense (benefit) from vested RSUs(5)

 

 

 (480)

 

 

 (138)

 

 

 (7,411)

 

 

 541

 

Non-GAAP amounts

 

$

 69,240

 

$

 32,390

 

$

 149,603

 

$

 59,369

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Earnings Per Share

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 2.38

 

$

 1.11

 

$

 5.51

 

$

 1.79

 

Innovative technology costs, after-tax (includes related financing costs)(1)

 

 

 0.20

 

 

 0.17

 

 

 0.60

 

 

 0.45

 

Gain on sale of subsidiary, after-tax(2)

 

 

 —

 

 

 —

 

 

 (0.20)

 

 

 —

 

Transaction costs, after-tax(3)

 

 

 0.04

 

 

 —

 

 

 0.04

 

 

 —

 

Nonunion pension expense, including settlement expense, after-tax(4)

 

 

 —

 

 

 —

 

 

 —

 

 

 —

 

Life insurance proceeds and changes in cash surrender value

 

 

 (0.01)

 

 

 (0.06)

 

 

 (0.11)

 

 

 (0.01)

 

Tax expense (benefit) from vested RSUs(5)

 

 

 (0.02)

 

 

 (0.01)

 

 

 (0.28)

 

 

 0.02

 

Non-GAAP amounts(6)

 

$

 2.59

 

$

 1.22

 

$

 5.57

 

$

 2.26

 

 


  1. Represents costs associated with the freight handling pilot test program at ABF Freight.
  2. Gain relates to the sale of the labor services portion of ArcBest segment’s moving business in second quarter 2021.
  3. Transaction costs are associated with the previously announced acquisition of MoLo Solutions, LLC.
  4. Represents pension settlement expense related to the Company’s supplemental benefit plan.
  5. The Company recognizes the tax impact for the vesting of share-based compensation resulting in excess tax expense (benefit).
  6. Non-GAAP EPS is calculated in total and may not foot due to rounding.

 

 

ARCBEST CORPORATION

RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES - Continued

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended 

 

Nine Months Ended 

 

 

 

September 30

 

September 30

 

 

    

2021

 

2020

 

2021

 

2020

 

Segment Operating Income Reconciliations

 

(Unaudited)

 

 

 

($ thousands, except percentages)

 

Asset-Based Segment

 

 

 

 

 

Operating Income ($) and Operating Ratio (% of revenues)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 83,618

 

 87.7

%  

 

$

 36,646

 

 93.5

%  

 

$

 177,584

 

 90.6

%  

 

$

 70,922

 

 95.4

%  

 

Innovative technology costs, pre-tax(1)

 

 

 6,903

 

 (1.0)

 

 

 

 6,199

 

 (1.1)

 

 

 

 21,303

 

 (1.1)

 

 

 

 15,521

 

 (1.0)

 

 

Non-GAAP amounts

 

$

 90,521

 

 86.7

%  

 

$