ArcBest Announces Second Quarter 2022 Results

Investor Relations Contact: David Humphrey

Media Contact: Autumnn Mahar

Title: Vice President – Investor Relations

Title: Senior Manager, PR and Social

Phone: 479-785-6200 

Phone: 479-494-8221

Email: dhumphrey@arcb.com

Email: amahar@arcb.com

 

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Record Quarterly Revenue, Operating Income and Net Income Demonstrate ArcBest’s Success Driving Growth and Value Creation

Strategic Growth Initiatives Solidify ArcBest’s Position as a Logistics Leader and Partner of Choice

  • Second quarter 2022 revenue of $1.4 billion increased 46.8 percent over second quarter 2021.
  • Net income improved to $102.5 million, or $4.00 per diluted share. On a non-GAAP basis, second quarter 2022 net income was $110.0 million, or $4.30 per diluted share.
  • Innovation investments contributed to revenue growth and improved profitability.

 

FORT SMITH, Arkansas, July 29, 2022 — ArcBest® (Nasdaq: ARCB), a leader in supply chain logistics, today reported second quarter 2022 revenue of $1.4 billion, an increase of $444.0 million compared to second quarter 2021. Each operating segment achieved at least double-digit percentage revenue growth over the prior year period. Second quarter 2022 results include the impact of the acquisition of MoLo Solutions, LLC (“MoLo”), which was completed in November 2021.

ArcBest’s second quarter 2022 operating income was $137.3 million and net income was $102.5 million, or $4.00 per diluted share, compared to operating income of $74.3 million and net income of $61.0 million, or $2.27 per diluted share, in the second quarter of 2021. The recent quarter’s revenue, operating income and net income totals were the highest of any quarter in ArcBest’s history. 

Excluding certain items in both periods as identified in the attached reconciliation tables, second quarter non-GAAP operating income was $150.5 million, compared to $76.8 million in the prior-year period. On a non-GAAP basis, net income was $110.0 million, or $4.30 per diluted share, compared to $54.6 million, or $2.03 per diluted share, in the second quarter of 2021.

“ArcBest’s talented and dedicated team has been successfully executing our strategy, delivering strong financial results and driving value-enhancing growth for the benefit of our shareholders, customers and other stakeholders. The second quarter of 2022 was no exception, as we achieved 47% revenue growth due to increasing demand for our broad offering of transportation and logistics services,” said Judy R. McReynolds, ArcBest chairman, president and CEO. “As our customers’ supply chains become even more complex and economic pressures increase, our strategic focus on technology, innovation and the development of our people positions us to thrive in all environments. By advancing our strategic plan and investing capital back into the business, we continue to differentiate ArcBest and position our company as a logistics leader, our customers' partner of choice, and a consistent generator of superior value for investors.”

Second Quarter Results of Operations Comparisons

Asset-Based

Second Quarter 2022 Versus Second Quarter 2021

  • Revenue of $802.6 million compared to $652.8 million, a per-day increase of 22.9 percent.
  • Total tonnage per day increase of 3.7 percent, including an increase of 0.9 percent in LTL-rated weight per shipment.
  • Total shipments per day increased 2.0 percent.
  • Total billed revenue per hundredweight increased 17.7 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 $116.7 million and an operating ratio of 85.5 percent compared to operating income of $63.9 million and an operating ratio of 90.2 percent. On a non-GAAP basis, operating income of $124.6 million and an operating ratio of 84.5 percent compared to operating income of $71.4 million and an operating ratio of 89.0 percent.

ArcBest’s Asset-Based business delivered strong revenue growth in the second quarter versus the prior year period due in part to a healthy pricing environment, higher fuel surcharges and an increase in ABF Freight’s average weight per shipment. Customer demand drove increases in this year’s freight shipments and tonnage resulting in growth compared to strong, double-digit percent increases in second quarter 2021. Strength in base freight rate pricing continued during the quarter reflecting the value of the logistics solutions ArcBest offers its customers during an ongoing period of supply chain volatility. ArcBest achieved higher second quarter profitability using optimization tools and improved freight data, maintaining more consistent day-to-day business levels while optimizing revenue and managing costs. Hiring initiatives continued at specific service center locations throughout the ABF Freight network and contributed to a net increase in employees.

Asset-Light

Second Quarter 2022 Versus Second Quarter 2021 (including the results of MoLo)

  • Revenue of $631.8 million compared to $330.3 million, a per-day increase of 91.3 percent.
  • Operating income of $29.1 million compared to $16.3 million. Prior year operating income included a $6.9 million gain on the sale of the labor services portion of the Asset-Light moving business. On a non‑GAAP basis, operating income of $31.9 million compared to $10.3 million.
  • Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) of $34.6 million compared to $12.1 million, as detailed in the attached non-GAAP reconciliation tables.

 

Higher market rates combined with continued customer demand for our services resulted in strong second quarter revenue growth and another quarter of record profitability in the ArcBest Asset-Light segment. Enhanced revenue and shipment totals versus the same period last year reflect the positive impact of additional truckload brokerage business from MoLo, for which the integration is on schedule. The broad range of ArcBest Asset-Light services offered through managed transportation, dedicated, expedite and international continue to be a great benefit to customers.  Each service positively contributed to improved Asset-Light profitability compared to the prior-year period as operating leverage increased due to the revenue growth of the business.

At FleetNet, revenue growth and improved profitability resulted from increases in both total events and revenue per event.

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 2022 second quarter results. The call will be today, Friday, July 29, at 9:30 a.m. EDT (8:30 a.m. CDT). Interested parties are invited to listen by calling (800) 891-8357 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 July 29, 2022, 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 September 15, 2022. To listen to the playback, dial (800) 633‑8284 or (402) 977‑9140 (for international callers). The conference call ID for the playback is 22019591. The conference call and playback can also be accessed, through September 15, 2022, 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 15,000 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 June 30, 2022 may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements regarding (i) our expectations about our intrinsic value or our prospects for growth and value creation and (ii) our financial outlook, position, strategies, goals, and expectations. Terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “forecast,” “foresee,” “intend,” “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: the effects of widespread outbreak of an illness or disease, including the COVID-19 pandemic, 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, including acts of war or terrorism or military conflicts; 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 acquisition of MoLo Solutions, LLC, and the inability to realize the anticipated benefits of the acquisition within the expected time period or at all; market fluctuations and interruptions affecting the price of our stock or the price or timing of our share repurchase programs; maintaining our corporate reputation and intellectual property rights; nationwide or global disruption in the supply chain increasing volatility in freight volumes; 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; increasing costs due to inflation; 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 

 

Six Months Ended 

 

 

 

June 30

 

June 30

 

 

    

2022

    

2021

    

2022

    

2021

 

 

 

(Unaudited)

 

 

 

($ thousands, except share and per share data)

 

REVENUES

 

$

 1,392,929

 

$

 948,973

 

$

 2,728,003

 

$

 1,778,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 1,255,583

 

 

 874,674

 

 

 2,495,729

 

 

 1,671,696

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING INCOME

 

 

 137,346

 

 

 74,299

 

 

 232,274

 

 

 106,490

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (COSTS)

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income

 

 

 361

 

 

 322

 

 

 467

 

 

 714

 

Interest and other related financing costs

 

 

 (1,863)

 

 

 (2,274)

 

 

 (3,802)

 

 

 (4,702)

 

Other, net

 

 

 (2,807)

 

 

 1,111

 

 

 (3,633)

 

 

 2,303

 

 

 

 

 (4,309)

 

 

 (841)

 

 

 (6,968)

 

 

 (1,685)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

 

 

 133,037

 

 

 73,458

 

 

 225,306

 

 

 104,805

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME TAX PROVISION

 

 

 30,576

 

 

 12,477

 

 

 53,276

 

 

 20,463

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME

 

$

 102,461

 

$

 60,981

 

$

 172,030

 

$

 84,342

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS PER COMMON SHARE

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

 4.16

 

$

 2.38

 

$

 6.98

 

$

 3.30

 

Diluted

 

$

 4.00

 

$

 2.27

 

$

 6.68

 

$

 3.13

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE COMMON SHARES OUTSTANDING

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 24,607,362

 

 

 25,586,353

 

 

 24,658,739

 

 

 25,522,453

 

Diluted

 

 

 25,596,031

 

 

 26,910,796

 

 

 25,756,314

 

 

 26,926,133

 

 

 

 

 

 

ARCBEST CORPORATION

CONSOLIDATED BALANCE SHEETS

             

 

 

 

June 30

 

December 31

 

 

    

2022

    

2021

 

 

 

(Unaudited)

 

Note

 

 

 

($ thousands, except share data)

 

ASSETS

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

 127,058

 

$

 76,620

 

Short-term investments

 

 

 76,802

 

 

 48,339

 

Accounts receivable, less allowances (2022 - $15,991; 2021 - $13,226)

 

 

 659,672

 

 

 582,344

 

Other accounts receivable, less allowances (2022 - $703; 2021 - $690)

 

 

 18,612

 

 

 13,094

 

Prepaid expenses

 

 

 32,353

 

 

 40,104

 

Prepaid and refundable income taxes

 

 

 10,310

 

 

 9,654

 

Other

 

 

 10,750

 

 

 5,898

 

TOTAL CURRENT ASSETS

 

 

 935,557

 

 

 776,053

 

 

 

 

 

 

 

 

 

PROPERTY, PLANT AND EQUIPMENT

 

 

 

 

 

 

 

Land and structures

 

 

 356,149

 

 

 350,694

 

Revenue equipment

 

 

 993,008

 

 

 980,283

 

Service, office, and other equipment

 

 

 276,965

 

 

 251,085

 

Software

 

 

 179,195

 

 

 175,989

 

Leasehold improvements

 

 

 20,189

 

 

 16,931

 

 

 

 

 1,825,506

 

 

 1,774,982

 

Less allowances for depreciation and amortization

 

 

 1,115,887

 

 

 1,079,061

 

 

 

 

 709,619

 

 

 695,921

 

 

 

 

 

 

 

 

 

GOODWILL

 

 

 299,075

 

 

 300,337

 

INTANGIBLE ASSETS, NET

 

 

 120,145

 

 

 126,580

 

OPERATING RIGHT-OF-USE ASSETS

 

 

 124,086

 

 

 106,686

 

DEFERRED INCOME TAXES

 

 

 5,655

 

 

 5,470

 

OTHER LONG-TERM ASSETS

 

 

 99,569

 

 

 101,629

 

TOTAL ASSETS

 

$

 2,293,706

 

$

 2,112,676

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

Accounts payable

 

$

 346,051

 

$

 311,401

 

Income taxes payable

 

 

 17,110

 

 

 12,087

 

Accrued expenses

 

 

 304,425

 

 

 305,851

 

Current portion of long-term debt

 

 

 56,049

 

 

 50,615

 

Current portion of operating lease liabilities

 

 

 24,534

 

 

 22,740

 

TOTAL CURRENT LIABILITIES

 

 

 748,169

 

 

 702,694

 

 

 

 

 

 

 

 

 

LONG-TERM DEBT, less current portion

 

 

 169,356

 

 

 174,917

 

OPERATING LEASE LIABILITIES, less current portion

 

 

 104,253

 

 

 88,835

 

POSTRETIREMENT LIABILITIES, less current portion

 

 

 16,694

 

 

 16,733

 

OTHER LONG-TERM LIABILITIES

 

 

 132,930

 

 

 135,537

 

DEFERRED INCOME TAXES

 

 

 59,092

 

 

 64,893

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

Common stock, $0.01 par value, authorized 70,000,000 shares;
      issued 2022: 29,614,798 shares; 2021: 29,359,597 shares

 

 

 296

 

 

 294

 

Additional paid-in capital

 

 

 340,035

 

 

 318,033

 

Retained earnings

 

 

 968,417

 

 

 801,314

 

   Treasury stock, at cost, 2022: 5,109,030 shares; 2021: 4,492,514 shares

 

 

 (250,510)

 

 

 (194,273)

 

Accumulated other comprehensive income

 

 

 4,974

 

 

 3,699

 

TOTAL STOCKHOLDERS’ EQUITY

 

 

 1,063,212

 

 

 929,067

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

 2,293,706

 

$

 2,112,676

 

 

Note: The balance sheet at December 31, 2021 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

 

 

 

 

 

 

 

 

 

 

Six Months Ended 

 

 

 

June 30

 

 

    

2022

    

2021

 

 

 

Unaudited

 

 

 

($ thousands)

 

 OPERATING ACTIVITIES

 

 

 

 

 

 

 

Net income

 

$

 172,030

 

$

 84,342

 

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

 

 

 

 

 

 

 

Depreciation and amortization

 

 

 63,690

 

 

 58,709

 

Amortization of intangibles

 

 

 6,463

 

 

 1,927

 

Share-based compensation expense

 

 

 6,641

 

 

 5,678

 

Provision for losses on accounts receivable

 

 

 3,583

 

 

 (334)

 

Change in deferred income taxes

 

 

 (6,371)

 

 

 (7,612)

 

Gain on sale of property and equipment

 

 

 (4,073)

 

 

 (8,408)

 

Gain on sale of subsidiary

 

 

 (402)

 

 

 (6,923)

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Receivables

 

 

 (87,092)

 

 

 (37,745)

 

Prepaid expenses

 

 

 7,477

 

 

 1,419

 

Other assets

 

 

 72

 

 

 25

 

Income taxes

 

 

 4,211

 

 

 12,275

 

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

 

 

 114

 

 

 761

 

Accounts payable, accrued expenses, and other liabilities

 

 

 18,280

 

 

 41,786

 

NET CASH PROVIDED BY OPERATING ACTIVITIES

 

 

 184,623

 

 

 145,900

 

 

 

 

 

 

 

 

 

 INVESTING ACTIVITIES

 

 

 

 

 

 

 

Purchases of property, plant and equipment, net of financings

 

 

 (49,682)

 

 

 (25,395)

 

Proceeds from sale of property and equipment

 

 

 9,115

 

 

 10,864

 

Proceeds from sale of subsidiary

 

 

 475

 

 

 9,013

 

Purchases of short-term investments

 

 

 (64,330)

 

 

 (43,690)

 

Proceeds from sale of short-term investments

 

 

 35,840

 

 

 49,165

 

Capitalization of internally developed software

 

 

 (8,541)

 

 

 (9,477)

 

Business acquisition, net of cash acquired(1)

 

 

 2,279

 

 

 —

 

NET CASH USED IN INVESTING ACTIVITIES

 

 

 (74,844)

 

 

 (9,520)

 

 

 

 

 

 

 

 

 

 FINANCING ACTIVITIES

 

 

 

 

 

 

 

Borrowings under credit facilities

 

 

 58,000

 

 

 —

 

Proceeds from notes payable

 

 

 7,280

 

 

 —

 

Payments on long-term debt

 

 

 (84,905)

 

 

 (54,643)

 

Net change in book overdrafts

 

 

 6,085

 

 

 (922)

 

Deferred financing costs

 

 

 —

 

 

 (189)

 

Payment of common stock dividends

 

 

 (4,927)

 

 

 (4,095)

 

Purchases of treasury stock

 

 

 (31,237)

 

 

 (8,100)

 

Payments for tax withheld on share-based compensation

 

 

 (9,637)

 

 

 (9,766)

 

NET CASH USED IN FINANCING ACTIVITIES

 

 

 (59,341)

 

 

 (77,715)

 

 

 

 

 

 

 

 

 

NET INCREASE IN CASH AND CASH EQUIVALENTS

 

 

 50,438

 

 

 58,665

 

Cash and cash equivalents at beginning of period

 

 

 76,620

 

 

 303,954

 

CASH AND CASH EQUIVALENTS AT END OF PERIOD

 

$

 127,058

 

$

 362,619

 

 

 

 

 

 

 

 

 

 NONCASH INVESTING ACTIVITIES

 

 

 

 

 

 

 

Equipment financed

 

$

 19,498

 

$

 8,138

 

Accruals for equipment received

 

$

 7,574

 

$

 5,984

 

Lease liabilities arising from obtaining right-of-use assets

 

$

 30,210

 

$

 6,051

 

 


  1. Represents cash received from escrow for post-closing adjustments related to the acquisition of MoLo.

 

 

ARCBEST CORPORATION

FINANCIAL STATEMENT OPERATING SEGMENT DATA AND OPERATING RATIOS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended 

 

 

Six Months Ended 

 

 

 

June 30

 

 

June 30

 

 

    

2022

    

 

2021

    

 

2022

    

 

2021

 

 

 

Unaudited

 

 

 

($ thousands, except percentages)

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Based

 

$

 802,622

 

 

 

 

$

 652,832

 

 

 

 

$

 1,507,933

 

 

 

 

$

 1,209,124

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ArcBest(1)

 

 

 549,655

 

 

 

 

 

 270,748

 

 

 

 

 

 1,144,939

 

 

 

 

 

 523,084

 

 

 

FleetNet

 

 

 82,132

 

 

 

 

 

 59,547

 

 

 

 

 

 160,510

 

 

 

 

 

 118,710

 

 

 

Total Asset-Light

 

 

 631,787

 

 

 

 

 

 330,295

 

 

 

 

 

 1,305,449

 

 

 

 

 

 641,794

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other and eliminations

 

 

 (41,480)

 

 

 

 

 

 (34,154)

 

 

 

 

 

 (85,379)

 

 

 

 

 

 (72,732)

 

 

 

Total consolidated revenues

 

$

 1,392,929

 

 

 

 

$

 948,973

 

 

 

 

$

 2,728,003

 

 

 

 

$

 1,778,186

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Based

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Salaries, wages, and benefits

 

$

 328,068

 

 40.9

%

 

$

 302,370

 

 46.3

%

 

$

 641,565

 

 42.5

%

 

$

 588,064

 

 48.6

%

Fuel, supplies, and expenses

 

 

 99,296

 

 12.4

 

 

 

 64,689

 

 9.9

 

 

 

 184,127

 

 12.2

 

 

 

 125,530

 

 10.4

 

Operating taxes and licenses

 

 

 12,823

 

 1.6

 

 

 

 12,303

 

 1.9

 

 

 

 25,316

 

 1.7

 

 

 

 24,551

 

 2.0

 

Insurance

 

 

 12,197

 

 1.5

 

 

 

 9,454

 

 1.4

 

 

 

 22,628

 

 1.5

 

 

 

 18,393

 

 1.5

 

Communications and utilities

 

 

 4,648

 

 0.6

 

 

 

 4,663

 

 0.7

 

 

 

 9,335

 

 0.6

 

 

 

 9,633

 

 0.8

 

Depreciation and amortization

 

 

 24,463

 

 3.1

 

 

 

 23,308

 

 3.6

 

 

 

 48,768

 

 3.2

 

 

 

 46,792

 

 3.9

 

Rents and purchased transportation

 

 

 121,550

 

 15.1

 

 

 

 95,082

 

 14.6

 

 

 

 224,535

 

 14.9

 

 

 

 170,670

 

 14.1

 

Shared services

 

 

 75,584

 

 9.4

 

 

 

 69,372

 

 10.6

 

 

 

 142,734

 

 9.6

 

 

 

 125,238

 

 10.4

 

Gain on sale of property and equipment(2)

 

 

 (1,370)

 

 (0.2)

 

 

 

 71

 

 —

 

 

 

 (4,065)

 

 (0.3)

 

 

 

 (8,624)

 

 (0.7)

 

Innovative technology costs(3)

 

 

 7,954

 

 1.0

 

 

 

 7,532

 

 1.2

 

 

 

 14,914

 

 1.0

 

 

 

 14,400

 

 1.2

 

Other

 

 

 753

 

 0.1

 

 

 

 77

 

 —

 

 

 

 1,386

 

 0.1

 

 

 

 511

 

 —

 

Total Asset-Based

 

 

 685,966

 

 85.5

%

 

 

 588,921

 

 90.2

%

 

 

 1,311,243

 

 87.0

%

 

 

 1,115,158

 

 92.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ArcBest(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchased transportation

 

$

 448,160

 

 81.5

%

 

$

 226,603

 

 83.7

%

 

$

 956,540

 

 83.5

%

 

$

 437,598

 

 83.6

%

Supplies and expenses

 

 

 4,263

 

 0.8

 

 

 

 2,476

 

 0.9

 

 

 

 7,529

 

 0.7

 

 

 

 5,044

 

 1.0

 

Depreciation and amortization(4)

 

 

 5,468

 

 1.0

 

 

 

 2,366

 

 0.9

 

 

 

 10,648

 

 0.9

 

 

 

 4,752

 

 0.9

 

Shared services

 

 

 57,986

 

 10.6

 

 

 

 29,078

 

 10.7

 

 

 

 108,183

 

 9.5

 

 

 

 55,150

 

 10.5

 

Gain on sale of subsidiary(5)

 

 

 (402)

 

 (0.1)

 

 

 

 (6,923)

 

 (2.6)

 

 

 

 (402)

 

 —

 

 

 

 (6,923)

 

 (1.3)

 

Other

 

 

 6,701

 

 1.2

 

 

 

 2,021

 

 0.8

 

 

 

 13,846

 

 1.2

 

 

 

 4,071

 

 0.8

 

 

 

 

 522,176

 

 95.0

%

 

 

 255,621

 

 94.4

%

 

 

 1,096,344

 

 95.8

%

 

 

 499,692

 

 95.5

%

FleetNet

 

 

 80,540

 

 98.1

%

 

 

 58,409

 

 98.1

%

 

 

 157,201

 

 97.9

%

 

 

 116,549

 

 98.2

%

Total Asset-Light

 

 

 602,716

 

 

 

 

 

 314,030

 

 

 

 

 

 1,253,545

 

 

 

 

 

 616,241

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other and eliminations(6)

 

 

 (33,099)

 

 

 

 

 

 (28,277)

 

 

 

 

 

 (69,059)

 

 

 

 

 

 (59,703)

 

 

 

Total consolidated operating expenses

 

$

 1,255,583

 

 90.1

%

 

$

 874,674

 

 92.2

%

 

$

 2,495,729

 

 91.5

%

 

$

 1,671,696

 

 94.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING INCOME

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Asset-Based

 

$

 116,656

 

 

 

 

$

 63,911

 

 

 

 

$

 196,690

 

 

 

 

$

 93,966

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ArcBest(1)

 

 

 27,479

 

 

 

 

 

 15,127

 

 

 

 

 

 48,595

 

 

 

 

 

 23,392

 

 

 

FleetNet

 

 

 1,592

 

 

 

 

 

 1,138

 

 

 

 

 

 3,309

 

 

 

 

 

 2,161

 

 

 

Total Asset-Light

 

 

 29,071

 

 

 

 

 

 16,265

 

 

 

 

 

 51,904

 

 

 

 

 

 25,553

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other and eliminations(6)

 

 

 (8,381)

 

 

 

 

 

 (5,877)

 

 

 

 

 

 (16,320)

 

 

 

 

 

 (13,029)

 

 

 

Total consolidated operating income

 

$

 137,346

 

 

 

 

$

 74,299

 

 

 

 

$

 232,274

 

 

 

 

$

 106,490

 

 

 


  1. The 2022 periods include the operations of MoLo, which was acquired on November 1, 2021.
  2. The six months ended June 30, 2021 include an $8.6 million gain on the sale of an unutilized service center property. The 2022 amounts primarily consist of gains on sale of replaced equipment.
  3. Represents costs associated with the freight handling pilot test program at ABF Freight.
  4. Depreciation and amortization includes amortization of intangibles associated with acquired businesses.
  5. Gain relates to the sale of the labor services portion of the ArcBest segment’s moving business in May 2021, including the contingent amount recognized in second quarter 2022 when the funds were released from escrow.
  6. “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 U.S. 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 

 

Six Months Ended 

 

 

June 30

 

 

June 30

 

 

    

2022

 

2021

    

  

2022

 

 

2021

 

ArcBest Corporation - Consolidated

 

(Unaudited)

 

 

 

($ thousands, except per share data)

 

Operating Income

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 137,346

 

$

 74,299

 

$

 232,274

 

$

 106,490

 

Innovative technology costs, pre-tax(1)

 

 

 10,341

 

 

 8,475

 

 

 20,027

 

 

 16,142

 

Purchase accounting amortization, pre-tax(2)

 

 

 3,214

 

 

 937

 

 

 6,427

 

 

 1,874

 

Change in fair value of contingent consideration, pre-tax(3)

 

 

 —

 

 

 —

 

 

 810

 

 

 —

 

Gain on sale of subsidiary, pre-tax(4)

 

 

 (402)

 

 

 (6,923)

 

 

 (402)

 

 

 (6,923)

 

Non-GAAP amounts

 

$

 150,499

 

$

 76,788

 

$

 259,136

 

$

 117,583

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 102,461

 

$

 60,981

 

$

 172,030

 

$

 84,342

 

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

 

 

 7,789

 

 

 6,417

 

 

 15,078

 

 

 12,241

 

Purchase accounting amortization, after-tax(2)

 

 

 2,397

 

 

 702

 

 

 4,793

 

 

 1,404

 

Change in fair value of contingent consideration, after-tax(3)

 

 

 —

 

 

 —

 

 

 604

 

 

 —

 

Gain on sale of subsidiary, after-tax(4)

 

 

 (317)

 

 

 (5,437)

 

 

 (317)

 

 

 (5,437)

 

Life insurance proceeds and changes in cash surrender value

 

 

 2,710

 

 

 (1,248)

 

 

 3,503

 

 

 (2,514)

 

Tax benefit from vested RSUs(5)

 

 

 (5,059)

 

 

 (6,796)

 

 

 (5,929)

 

 

 (6,931)

 

Non-GAAP amounts

 

$

 109,981

 

$

 54,619

 

$

 189,762

 

$

 83,105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Earnings Per Share

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 4.00

 

$

 2.27

 

$

 6.68

 

$

 3.13

 

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

 

 

 0.30

 

 

 0.24

 

 

 0.59

 

 

 0.45

 

Purchase accounting amortization, after-tax(2)

 

 

 0.09

 

 

 0.03

 

 

 0.19

 

 

 0.05

 

Change in fair value of contingent consideration, after-tax(3)

 

 

 —

 

 

 —

 

 

 0.02

 

 

 —

 

Gain on sale of subsidiary, after-tax(4)

 

 

 (0.01)

 

 

 (0.20)

 

 

 (0.01)

 

 

 (0.20)

 

Life insurance proceeds and changes in cash surrender value

 

 

 0.11

 

 

 (0.05)

 

 

 0.14

 

 

 (0.09)

 

Tax benefit from vested RSUs(5)

 

 

 (0.20)

 

 

 (0.25)

 

 

 (0.23)

 

 

 (0.26)

 

Non-GAAP amounts(6)

 

$

 4.30

 

$

 2.03

 

$

 7.37

 

$

 3.09

 

 


  1. Represents costs associated with the freight handling pilot test program at ABF Freight and initiatives to optimize our performance through technological innovation, including costs related to our investment in human-centered remote operation software.
  2. Represents the amortization of acquired intangible assets related to the November 1, 2021 acquisition of MoLo and previously acquired businesses in the ArcBest segment.
  3. Represents change in fair value of the contingent consideration recorded for the MoLo acquisition. The liability for contingent consideration is remeasured at each quarterly reporting date, and any change in fair value as a result of the recurring assessments is recognized in operating income. As previously disclosed, contingent consideration for the MoLo acquisition will be paid based on achievement of certain targets of adjusted earnings before interest, taxes, depreciation, and amortization, as adjusted for certain items pursuant to the merger agreement, for years 2023 through 2025.
  4. Gain relates to the sale of the labor services portion of the ArcBest segment’s moving business in May 2021, including the contingent amount recognized in second quarter 2022 when the funds were released from escrow.
  5. Represents recognition of the tax impact for the vesting of share-based compensation.
  6. Non-GAAP EPS is calculated in total and may not foot due to rounding.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended 

 

Six Months Ended 

 

 

 

June 30

 

June 30

 

 

    

2022

 

2021

 

2022

 

2021

 

Segment Operating Income Reconciliations

 

(Unaudited)

 

 

 

($ thousands, except percentages)

 

Asset-Based Segment

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 116,656

 

 85.5

%  

 

$

 63,911

 

 90.2

%  

 

$

 196,690

 

 87.0

%  

 

$

 93,966

 

 92.2

%  

 

Innovative technology costs, pre-tax(1)

 

 

 7,954

 

 (1.0)

 

 

 

 7,532

 

 (1.2)

 

 

 

 14,914

 

 (1.0)

 

 

 

 14,400

 

 (1.2)

 

 

Non-GAAP amounts

 

$

 124,610

 

 84.5

%  

 

$

 71,443

 

 89.0

%  

 

$

 211,604

 

 86.0

%  

 

$

 108,366

 

 91.0

%  

 

 

 

 

 

 

 

Asset-Light

 

 

 

 

 

ArcBest Segment

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amounts on GAAP basis

 

$

 27,479

 

 95.0

%  

 

$

 15,127

 

 94.4

%  

 

$

 48,595

 

 95.8

%  

 

$

 23,392