Universal Truckload Services, Inc. Reports First Quarter 2016 Financial Results

WARREN, Mich., April 28, 2016

Operating revenues from our transportation services decreased $10.5 million, or 6.5%, to $149.9 million in the quarter ended April 2, 2016.  The decline included an $8.4 million decrease in fuel surcharges, and a 6.7% decrease in average operating revenues per load, excluding fuel surcharges. Load volumes were relatively stable, increasing a modest 1.1%, however, a weak pricing environment and declining fuel surcharges drove the overall decline.  Value-added service revenues increased $5.3 million, or 7.6%, in the most recent quarter to $75.6 million reflecting new business awarded in the second half of 2015.  Intermodal service revenues also increased, up 6.0% to $34.9 million compared to the same period last year.  Our intermodal service revenues include a $2.7 million increase in drayage revenues, partially offset by lower domestic intermodal and depot services.

Consolidated income from operations decreased $1.1 million to $13.9 million in the first quarter of 2016 and EBITDA decreased 6.8% to $22.5 million during the same period.  Our operating margin and EBITDA margin for the first quarter of 2016 are 5.3% and 8.6% of operating revenues.  These profitability metrics compare to 5.7% and 9.1%, respectively, in the first quarter of 2015.

Income from operations in our transportation segment decreased 7.3% to $5.9 million in the first quarter of 2016, despite a $9.7 million decline in transportation segment revenues.  Income from operations in our logistics segment, which includes value-added services and dedicated transportation services, decreased 2.6%, or $0.2 million to $8.5 million on $102.6 million of operating revenues compared to $96.2 million in operating revenues in the same period last year.

"We are starting to see the growth anticipated in our value-added services," commented Universal's Chief Executive Officer, Jeff Rogers.  "However, a soft pricing environment and low diesel prices continues to put downward pressure in our transportation service revenues.  Once again, intermodal performed very well for us and we are getting excited about the improvements made in our dedicated operations.  There is work ahead of us, but we will stay focused on driving profitable growth, and ensure we are achieving maximum efficiency with our strong business model."

Universal calculates and reports selected financial metrics in connection with lending arrangements, or 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."

As of April 2, 2016, we held cash and cash equivalents totaling $11.7 million and marketable securities of $13.4 million.  Outstanding debt, net of debt issue costs, totaled $233.4 million and our capital expenditures totaled $36.0 million during the first three months of 2016.