ulh-ex991

Universal Logistics Holdings Reports First Quarter 2022 All-Time Record Quarterly Results; Declares Dividend

Warren, MI – May 5, 2022 — Universal Logistics Holdings, Inc. (NASDAQ: ULH) today reported consolidated first quarter 2022 net income of $42.0 million, or $1.56 per basic and diluted share, on total operating revenues of $523.9 million. This compares to net income of $21.7 million, or $0.80 per basic and diluted share, during first quarter 2021 on total operating revenues of $415.2 million. Universal’s first quarter 2022 financial results represent record all-time highs for total operating revenues, operating income and earnings per share.

In the first quarter 2022, Universal’s operating income increased 85.7% to $57.8 million compared to operating income of $31.2 million in the first quarter one year earlier. As a percentage of operating revenue, operating margin for the first quarter 2022 was 11.0% compared to 7.5% during the same period last year. EBITDA, a non-GAAP measure, increased $23.8 million during the first quarter 2022 to $75.0 million, compared to $51.2 million one year earlier. As a percentage of operating revenue, EBITDA margin for the first quarter 2022 was 14.3% compared to 12.3% during the same period last year.

“The first quarter of 2022 set a series of new all-time highs for Universal,” stated Tim Phillips, Universal’s Chief Executive Officer. “During the first thirteen weeks of the year, Universal experienced its highest operating revenues, largest operating income, and best earnings per share, not just for a first quarter, but in all of Universal’s history. Our efforts evaluating operating cost structures and negotiating rate increases with our customers, as well as continued rationalization of underperforming business across our service lines, came to fruition in the first quarter.

I also remain mindful of the challenges facing our industry today. We continue to see supply chain disruptions, a competitive market for equipment and talent, as well as some more recent intermittent shut-downs of our customers’ operations as they are seeking to secure parts to build cars and trucks. However, I believe it’s our job to navigate these challenges, and to continue delivering exceptional service and results. The first quarter of 2022 is off to a great start, and I believe we will find additional execution improvement opportunities as the year unfolds. I am extremely pleased with the talented group of people we have assembled at Universal, and I am confident we will continue to exceed the goals we have set for the year, which includes $2.0 billion in top-line revenue for 2022.”

In the contract logistics segment, which includes our value-added and dedicated services, first quarter 2022 operating revenues increased 30.1% to $201.6 million, compared to $154.9 million for the same period last year. At the end of the first quarter 2022, we managed 63 value-added programs, compared to 60 such programs at the end of the first quarter 2021. While reported dedicated transportation load volumes grew by 1.2%, new business wins, including a major shuttle operation, as well as repricing of existing customer contracts were significant contributing factors to the overall growth in dedicated transportation. Also included in dedicated transportation revenues for the recently completed quarter were $8.8 million in separately identified fuel surcharges, compared to $4.9 million during the same period last year. In the contract logistics segment, first quarter 2022 income from operations increased $6.7 million to $23.5 million, compared to $16.8 million during the same period last year. As a percentage of revenue, operating margin in the contract logistics segment for the first quarter 2022 was 11.6%, compared to 10.9% during the same period last year.

Operating revenues in the intermodal segment increased $53.9 million to $157.6 million in the first quarter 2022, compared to $103.7 million for the same period last year. Included in intermodal segment revenues for the recently completed quarter were $18.2 million in separately identified fuel surcharges, compared to $10.2 million during the same period last year. Intermodal segment revenues also include other accessorial charges such as detention, demurrage and storage which totaled $36.2 million during the first quarter 2022, compared to $11.0 million one year earlier. The average operating revenue per load, excluding fuel surcharges, increased 51.2%; however, load volumes fell 14.3% year-over-year. First quarter 2022 income from operations increased $14.5 million to $23.0 million, compared to $8.5 million during the same period last year. As a percentage of revenue, operating margin in the intermodal segment for the first quarter 2022 was 14.6%, compared to 8.2% during the same period last year.

In the trucking segment first quarter 2022 operating revenues increased 2.7% to $97.5 million, compared to $94.9 million for the same period last year. First quarter 2022 trucking segment revenues included $42.0 million of brokerage services, compared to $35.8 million during the same period last year. Also included in our trucking segment revenues were $7.5 million in separately identified fuel surcharges during the first quarter 2022, compared to $5.1 million in fuel surcharges during the same period last year. On a year-over-year basis, the average operating revenue per load, excluding fuel surcharges, increased 41.4%; however load volumes fell 30.1% as we rationalized some underperforming operations in this segment. Income from operations in the first quarter 2022 increased $2.2 million to $7.4 million compared to $5.2 million during the same period last year. As a percentage of revenue, operating margin in the trucking segment for the first quarter 2022 was 7.6% compared to 5.5% during the same period last year.

First quarter 2022 operating revenues in the company-managed brokerage segment increased $4.1 million to $65.2 million, compared to $61.1 million for the same period last year. Income from operations in the first quarter 2022 increased $3.5 million to $3.9 million compared to $0.4 million during the same period last year. The company-managed brokerage segment’s load volumes decreased 25.2%; however, average operating revenue per load increased 25.3% on a year-over-year basis. As a percentage of revenue, operating margin in the company-managed brokerage segment for the first quarter 2022 was 5.9% compared to 0.7% during the same period last year.

Universal Logistics Holdings, Inc. also announced today that its Board of Directors has declared a cash dividend of $0.105 per share of common stock. The dividend is payable to shareholders of record at the close of business on June 6, 2022 and is expected to be paid on July 5, 2022.

As of April 2, 2022, Universal held cash and cash equivalents totaling $14.9 million, and $9.0 million in marketable securities. Outstanding debt at the end of the first quarter 2022 was $402.7 million and capital expenditures totaled $6.0 million.

During the first quarter of 2022, the Company also purchased 257,261 shares of its common stock at an average purchase price of $20.42 per share. Universal is currently authorized to purchase up to 742,739 additional shares of the Company’s common stock under its previously announced share repurchase plan.

Universal calculates and reports selected financial metrics not only for purposes of our lending arrangements but also in an effort to isolate and exclude the impact of non-operating expenses related to our corporate development activities. These statistics are described in more detail below in the section captioned “Non-GAAP Financial Measures.”

A replay of the conference call will be available beginning two hours after the call through May 13, 2022, by calling (855) 859-2056 (toll free) or +1 (404) 537-3406 (toll) and using conference ID 2084677. The call will also be available on investors.universallogistics.com.

Universal Logistics Holdings, Inc. (“Universal”) is a holding company that owns subsidiaries engaged in providing a variety of customized transportation and logistics solutions throughout the United States, and in Mexico, Canada and Colombia. Our operating subsidiaries provide customers with supply chain solutions that can be scaled to meet their changing demands and volumes. Universal’s consolidated subsidiaries offer customers a broad array of services across the entire supply chain, including truckload, brokerage, intermodal, dedicated, and value-added services. In this press release, the terms “us,” “we,” “our,” or the “Company” refer to Universal and its consolidated subsidiaries.

Some of the statements contained in this press release might be considered forward-looking statements. These statements identify prospective information. Forward-looking statements can be identified by words such as: “expect,” “anticipate,” “intend,” “plan,” “goal,” “prospect,” “seek,” “believe,” “targets,” “project,” “estimate,” “future,” “likely,” “may,” “should” and similar references to future periods. Forward-looking statements are based on information available at the time and/or management’s good faith belief with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements. These forward-looking statements are subject to a number of factors that may cause actual results to differ materially from the expectations described. Additional information about the factors that may adversely affect these forward-looking statements is contained in Universal’s reports and filings with the Securities and Exchange Commission. Universal assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws.

	Thirteen Weeks Ended
	April 2,			April 3,
	2022			2021
Operating revenues:
Truckload services	$	57,483		$	59,702
Brokerage services		107,172			96,919
Intermodal services		157,613			103,716
Dedicated services		75,487			47,961
Value-added services		126,106			106,933
Total operating revenues		523,861			415,231

Operating expenses:
Purchased transportation and equipment rent		232,131			189,331
Direct personnel and related benefits		136,667			107,552
Operating supplies and expenses		42,124			37,092
Commission expense		10,024			7,324
Occupancy expense		10,195			8,180
General and administrative		10,063			9,176
Insurance and claims		8,581			6,335
Depreciation and amortization		16,228			19,085
Total operating expenses		466,013			384,075
Income from operations		57,848			31,156
Interest expense, net		(2,433	)		(3,163	)
Other non-operating income		953			1,006
Income before income taxes		56,368			28,999
Provision for income taxes		14,360			7,344
Net income	$	42,008		$	21,655

Earnings per common share:
Basic	$	1.56		$	0.80
Diluted	$	1.56		$	0.80

Weighted average number of common shares outstanding:
Basic		26,864			26,916
Diluted		26,865			26,930

Dividends declared per common share:	$	0.105		$	0.105

	April 2, 2022		December 31, 2021
Assets
Cash and cash equivalents	$	14,922	$	13,932
Marketable securities		8,980		8,031
Accounts receivable - net		392,951		341,398
Other current assets		60,899		57,334
Total current assets		477,752		420,695
Property and equipment - net		337,025		345,583
Other long-term assets - net		374,385		371,213
Total assets	$	1,189,162	$	1,137,491

Liabilities and shareholders' equity
Current liabilities, excluding current maturities of debt	$	295,363	$	251,550
Debt - net		401,699		427,348
Other long-term liabilities		158,386		156,383
Total liabilities		855,448		835,281
Total shareholders' equity		333,714		302,210
Total liabilities and shareholders' equity	$	1,189,162	$	1,137,491

	Thirteen Weeks Ended
	April 2,		April 3,
	2022		2021
Contract Logistics Segment:
Number of dedicated transportation loads (a)		158,219		156,375
Average number of value-added direct employees		5,096		3,888
Average number of value-added full-time equivalents		1,584		1,686
Number of active value-added programs		63		60

Intermodal Segment:
Number of loads		154,207		179,905
Average operating revenue per load, excluding fuel surcharges	$	697	$	461
Average number of tractors		2,124		1,971
Number of depots		12		12

Trucking Segment:
Number of loads		50,860		72,744
Average operating revenue per load, excluding fuel surcharges	$	1,762	$	1,246
Average length of haul		403		373
Average number of tractors		1,000		1,317

Company-Managed Brokerage Segment:
Number of loads (b)		24,610		32,885
Average operating revenue per load (b)	$	2,176	$	1,737
Average length of haul (b)		574		564

	Thirteen Weeks Ended
	April 2,		April 3,
	2022		2021
Operating Revenues by Segment:
Contract logistics	$	201,593	$	154,894
Intermodal		157,613		103,716
Trucking		97,485		94,899
Company-managed brokerage		65,206		61,106
Other		1,964		616
Total	$	523,861	$	415,231

Income from Operations by Segment:
Contract logistics	$	23,475	$	16,820
Intermodal		23,010		8,494
Trucking		7,419		5,191
Company-managed brokerage		3,863		440
Other		81		211
Total	$	57,848	$	31,156

In addition to providing consolidated financial statements based on generally accepted accounting principles in the United States of America (GAAP), we are providing additional financial measures that are not required by or prepared in accordance with GAAP (non-GAAP). We present EBITDA and EBITDA margin, each a non-GAAP measure, as supplemental measures of our performance. We define EBITDA as net income plus (i) interest expense, net, (ii) income taxes, (iii) depreciation, and (iv) amortization. We define EBITDA margin as EBITDA as a percentage of total operating revenues. You are encouraged to evaluate these adjustments and the reasons we consider them appropriate for supplemental analysis.

In accordance with the requirements of Regulation G issued by the Securities and Exchange Commission, we are presenting the most directly comparable GAAP financial measure and reconciling the non-GAAP financial measure to the comparable GAAP measure. Set forth below is a reconciliation of net income, the most comparable GAAP measure, to EBITDA for each of the periods indicated:

	Thirteen Weeks Ended
	April 2,			April 3,
	2022			2021
	( in thousands)
EBITDA
Net income	$	42,008		$	21,655
Income tax expense		14,360			7,344
Interest expense, net		2,433			3,163
Depreciation		12,648			15,605
Amortization		3,580			3,480
EBITDA	$	75,029		$	51,247

EBITDA margin (a)		14.3	%		12.3	%

We present EBITDA and EBITDA margin because we believe they assist investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.

Because of these limitations, EBITDA and EBITDA margin should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and only supplementally on EBITDA and EBITDA margin.