J.B. Hunt Reports Revenues and Earnings Up Q1 2018

J.B. Hunt Transport Services, Inc., announced first quarter 2018 net earnings of $118.1 million, or diluted earnings per share of $1.07 vs. first quarter 2017 net earnings of $102.7 million, or 92 cents per diluted share.

J.B. Hunt reported that total operating revenue for the current quarter was $1.95 billion, compared with $1.63 billion for the first quarter 2017. Current quarter total operating revenue, excluding fuel surcharges, increased 17% vs. first quarter 2017. Intermodal (JBI) load growth was 6% and revenue per load excluding fuel surcharges increased approximately 4% over first quarter 2017 levels. Dedicated Contract Services (DCS) segment revenue increased by 26% over prior year primarily from additional customer contracts from a year ago and customer rate increases. Integrated Capacity Solutions (ICS) load growth was 6% and revenue per load increased approximately 34% over the same period in 2017. Truck (JBT) segment revenue decreased 1% primarily from fewer seated trucks compared to a year ago.

Operating income for the current quarter totaled $169 million vs. $149 million for the first quarter 2017. Benefits from volume growth, higher customer rates, new customer contracts and a continuing vibrant spot pricing market were partially offset by increased purchased transportation costs; lower intermodal network utilization; lower productivity in winter weather affected regions; higher driver and non-driver salaries, wages and benefits; higher Final Mile Services (FMS) network facilities costs; higher maintenance costs on equipment scheduled to be traded in 2018; increased technology spend on legacy system upgrades; continuing branch network expansion; increased equipment ownership costs and increased insurance and claims costs.

Net interest expense for the current quarter increased 34% from the same period in 2017 due to higher effective interest rates on our debt.

The effective income tax rate decreased to 26.0% in the current quarter compared to 28.0% in the first quarter 2017 due to the estimated impact of the Tax Cuts and Jobs Act of 2017. First quarter 2017 recorded a one-time tax benefit of $13.6 million or 12 cents per diluted share from the claiming of research and development tax credits and domestic production tax deductions incurred during the 2012 through 2016 tax years. The annual tax rate for 2018 is estimated to be 26.0%.

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