USA Truck Reports First Quarter 2022 Results

Rhea-AI Summary

USA Truck Inc. (NASDAQ:USAK) reported a record first-quarter performance for 2022, with earnings per diluted share soaring 262.5% to $1.45. Consolidated operating revenue rose 26.8% to $201.1 million compared to Q1 2021. The company achieved a net income of $13.1 million, up from $3.6 million in the prior year, marking the seventh consecutive quarter of record earnings. The Trucking segment's operating ratio improved significantly to 87.0%, while USAT Logistics saw a substantial revenue increase of 42.5% to $97.4 million.

Positive

• Earnings per diluted share increased 262.5% to $1.45 for Q1 2022.
• Consolidated operating revenue rose 26.8% to $201.1 million year-over-year.
• Net income up to $13.1 million from $3.6 million in Q1 2021.
• Trucking segment adjusted operating ratio improved 890 basis points to 87.0%.
• USAT Logistics revenue increased by 42.5% to $97.4 million.

Negative

• Average number of seated tractors decreased by 3.7% to 1,716 compared to Q1 2021.
• Loaded miles per available tractor per week decreased by 4.2% over the same period.

• Earnings per diluted share increased 262.5% to $1.45 for 1Q 2022
• Adjusted earnings per diluted share^(a) increased 244.2% to $1.48 for 1Q 2022
• Consolidated operating revenue increased 26.8% to $201.1 million for 1Q 2022

VAN BUREN, AR / ACCESSWIRE / April 28, 2022 / USA Truck Inc. (NASDAQ:USAK), a leading capacity solutions provider, today announced its financial results for the quarter ended March 31, 2022.

For the quarter ended March 31, 2022 (the "2022 Quarter"), consolidated operating revenue was $201.1 million compared to $158.5 million for the quarter ended March 31, 2021 (the "2021 Quarter"). Base revenue^(a) for the 2022 Quarter, which excludes fuel surcharge revenue, was $176.4 million compared to $144.3 million for the 2021 Quarter. The Company reported net income of $13.1 million, or $1.45 per diluted share for the 2022 Quarter and adjusted net income^(a) of $13.4 million, or $1.48 per diluted share, compared to net income of $3.6 million, or $0.40 per diluted share and adjusted net income^(a) of $3.8 million, or $0.43 per diluted share for the 2021 Quarter. The Company's consolidated operating ratio was 90.7%, compared to 96.2% for the 2021 Quarter.

President and CEO James Reed commented, "This quarter USA Truck produced the best first quarter earnings per share in the Company's history and the seventh consecutive quarter of record earnings. The Company also delivered its highest first quarter total revenue and adjusted earnings per share in its history.

Segment results continue to reflect improved operating results as the Trucking segment adjusted operating ratio^(a) improved 890 basis points year over year to 87.0%, and the USAT Logistics segment delivered a 24.8% increase in load volume with operating revenue up 42.5% year over year. Management's focus and continued execution on the operating strategy and strategic initiatives drove these results."

Trucking: For the 2022 Quarter, Trucking operating revenue (before intersegment eliminations) increased $13.0 million, or 12.6%, to $116.1 million compared to the 2021 Quarter. Trucking operating income of $12.6 million for the 2022 Quarter reflected an operating ratio of 89.1% compared to operating income of $3.5 million and an operating ratio of 96.6% for the 2021 Quarter. This represented an increase of $9.1 million year over year in operating income and a 750 basis point improvement in operating ratio. Trucking adjusted operating income^(a) was $12.9 million for the 2022 Quarter, reflecting an adjusted operating ratio^(a) of 87.0%, compared to adjusted operating income^(a) of $3.8 million and an adjusted operating ratio^(a) of 95.9% for the 2021 Quarter. This represented an increase of $9.1 million year over year in adjusted operating income^(a) and an 890 basis point improvement in adjusted operating ratio^(a).

Trucking operations delivered the following results for the 2022 Quarter compared to the 2021 Quarter:

• Base revenue per available tractor per week increased $451, or 11.8%.
• Base revenue per loaded mile increased $0.417, or 16.7%.
• Deadhead percentage improved 80 basis points over the 2021 Quarter and 90 basis points over the sequential quarter.
• Loaded miles per available tractor per week decreased 65 miles, or 4.2%, over the 2021 Quarter, but increased 53 miles, or 3.7%, over the sequential quarter.
• Average number of seated tractors was 1,716, a decrease of 3.7% when compared to an average of 1,782 in the 2021 Quarter. Average unseated tractor percentage was unchanged from 5.8% for the 2021 Quarter, but improved from 6.1% sequentially.

USAT Logistics: Operating revenue (before intersegment eliminations) was $97.4 million for the 2022 Quarter, an increase of $29.1 million, or 42.5%, compared to the 2021 Quarter. Operating income and adjusted operating income^(a) were $6.1 million for the 2022 Quarter, reflecting an operating ratio of 93.8% and an adjusted operating ratio^(a) of 93.2%, compared to operating income and adjusted operating income^(a) of $2.5 million and an operating ratio of 96.3% and adjusted operating ratio^(a) of 96.1% for the 2021 Quarter. This change represented an increase of $3.5 million year over year in both operating income and adjusted operating income^(a) and an improvement of 250 basis points in operating ratio and 290 basis points in adjusted operating ratio^(a) compared to the 2021 Quarter.

USAT Logistics operations delivered the following results during the 2022 Quarter:

• Gross margin dollars increased 61.2% to $13.3 million compared to the 2021 Quarter, and 11.9%, or $1.4 million, sequentially.
• Gross margin percentage increased 160 basis points to 13.6% when compared to 12.0% for the 2021 Quarter and 110 basis points sequentially from 12.5%.
• Revenue per load increased 14.2%, or $294 per load compared to the 2021 Quarter, and 0.4%, or $10 per load, sequentially.
• Load count increased by 8,194 loads, or 24.8% compared to the 2021 Quarter, and 1,005 loads, or 2.5%, sequentially.

Segment Results

The following table includes key operating results and statistics by reportable segment:

		Three Months Ended								Three Months Ended
		March 31,								December 31,
Trucking:		2022				2021				2021
Operating revenue (before intersegment eliminations) (in thousands)		$	116,071			$	103,103			$	119,453
Operating income (1) (in thousands)		$	12,628			$	3,520			$	11,573
Adjusted operating income (2) (in thousands)		$	12,950			$	3,843			$	11,896
Operating ratio (3)			89.1	%			96.6	%			90.3	%
Adjusted operating ratio (4)			87.0	%			95.9	%			88.7	%
Total miles (5) (in thousands)			38,487				42,148				39,467
Deadhead percentage (6)			10.8	%			11.6	%			11.7	%
Base revenue per loaded mile		$	2.907			$	2.490			$	3.033
Average number of seated tractors			1,716				1,782				1,761
Average number of available tractors (7)			1,821				1,892				1,875
Average number of in-service tractors (8)			1,858				1,923				1,903
Loaded miles per available tractor per week			1,467				1,532				1,414
Base revenue per available tractor per week		$	4,265			$	3,814			$	4,290
Average loaded miles per trip			496				520				495
USAT Logistics:
Operating revenue (before intersegment eliminations) (in thousands)		$	97,444			$	68,381			$	94,648
Operating income (1) (in thousands)		$	6,055			$	2,526			$	4,900
Adjusted operating income (2) (in thousands)		$	6,055			$	2,526			$	4,900
Gross margin (9) (in thousands)		$	13,259			$	8,224			$	11,853
Gross margin percentage (10)			13.6	%			12.0	%			12.5	%
Load count (in thousands)			41.3				33.1				40.3

1. Operating income is calculated by deducting operating expenses (before intersegment eliminations) from operating revenue (before intersegment eliminations).
2. Adjusted operating income^(a) is calculated by deducting operating expenses (before intersegment eliminations) excluding amortization of acquisition related intangibles, net of fuel surcharge revenue, from operating revenue (before intersegment eliminations), net of fuel surcharge revenue.
3. Operating ratio is calculated as operating expenses (before intersegment eliminations) as a percentage of operating revenue (before intersegment eliminations).
4. Adjusted operating ratio^(a) is calculated as operating expenses (before intersegment eliminations) excluding amortization of acquisition related intangibles, net of fuel surcharge revenue, as a percentage of operating revenue (before intersegment eliminations) excluding fuel surcharge revenue.
5. Total miles include both loaded and empty miles.
6. Deadhead percentage is calculated by dividing empty miles by total miles.
7. Available tractors are a) all Company tractors that are available to be dispatched, including available unseated tractors, and b) all tractors in the independent contractor fleet.
8. In-service tractors include all of the tractors in the Company fleet (Company-operated tractors) and all the tractors in the independent contractor fleet.
9. Gross margin is calculated by deducting USAT Logistics purchased transportation expense from USAT Logistics operating revenue (before intersegment eliminations).
10. Gross margin percentage is calculated as USAT Logistics gross margin divided by USAT Logistics operating revenue (before intersegment eliminations).

Balance Sheet and Liquidity

As of March 31, 2022, total debt and finance lease liabilities was $161.1 million, total debt and finance lease liabilities, net of cash (excluding restricted cash) ("Net Debt")^(a) was $149.1 million. Net Debt^(a) to Adjusted EBITDA^(a) for the trailing twelve months ended March 31, 2022 was 1.7x. In the quarter, the Company completed its planned execution of a series of equipment financing arrangements that secured low cost fixed interest rates through term loans. The proceeds from these loans were used to retire the Company's previous credit facility. On January 31, 2022 the Company completed a new $130.0 million senior secured revolving credit facility. The Company had full availability under its new credit facility as of March 31, 2022.

First Quarter 2022 Conference Call Information

USA Truck will hold a conference call to discuss its first quarter 2022 results on Friday, April 29, 2022 at 8:00 AM CT / 9:00 AM ET. To participate in the call, please dial 1-877-545-0320 (Toll Free) or 1‑973‑528‑0002 (International) and reference access code 625844. A live webcast of the conference call will be broadcast in the Investor Relations section of the Company's website www.usa-truck.com, under the "Events & Presentations" tab of the "Investor Relations" menu. For those who cannot listen to the live broadcast, the presentation materials and an audio replay of the call will be available at our website, www.usa-truck.com, under the "Events & Presentations" tab of the "Investor Relations" menu, or may be accessed using the following link: https://www.webcaster4.com/Webcast/Page/2611/45204. A telephone replay of the call will also be available for one year from the date of the call.

^(a) About Non-GAAP Financial Information

In addition to our GAAP results, this press release also includes certain non-GAAP financial measures, as defined by the SEC. The terms "Base Revenue", "Net Debt", "Adjusted EBITDA", "Adjusted operating ratio", "Adjusted operating income", "Adjusted net income", and "Adjusted earnings per diluted share", as we define them, are not presented in accordance with GAAP.

The Company defines Base Revenue as operating revenue less fuel surcharge revenue and intercompany eliminations. The Company defines Net Debt as total debt, including insurance premium financing and financing lease liabilities, net of cash (excluding restricted cash). The Company defines Adjusted EBITDA as net income, plus interest expense net of interest income, provision for income tax expense, depreciation and amortization, and non-cash equity compensation. Adjusted operating ratio is calculated as operating expenses excluding amortization of acquisition related intangibles, net of fuel surcharge revenue, as a percentage of operating revenue excluding fuel surcharge revenue. Adjusted operating income is calculated by deducting operating expenses excluding amortization of acquisition related intangibles, net of fuel surcharge revenue, from operating revenue, net of fuel surcharge revenue. Adjusted net income is defined as net income excluding amortization of acquisition related intangibles plus or minus the income tax effect of such adjustments using a statutory tax rate. Adjusted earnings per diluted share is defined as Adjusted net income divided by the weighted average number of diluted shares outstanding during the period. The per-share impact of each item is determined by dividing it by the weighted average diluted shares outstanding. These financial measures supplement our GAAP results in evaluating certain aspects of our business. We believe that using these measures improves comparability in analyzing our performance because they remove the impact of items from our operating results that, in our opinion, do not reflect our core operating performance. Management and the board of directors focus on Base Revenue, Net Debt, Adjusted EBITDA, Adjusted operating ratio, Adjusted operating income, Adjusted net income, and Adjusted earnings per diluted share as key measures of our performance and liquidity, each of which are reconciled to the most comparable GAAP financial measure and further discussed below. We believe our presentation of these non-GAAP financial measures is useful to investors and other users because it provides them the same information that we use internally for purposes of assessing our core operating performance.

These non-GAAP financial measures are not substitutes for their comparable GAAP financial measures, such as total revenue, total debt, net income, cash flows from operating activities, operating ratio, net income, diluted earnings per share, or other measures prescribed by GAAP. There are limitations to using non-GAAP financial measures. Although we believe that they improve comparability in analyzing our period to period performance, they could limit comparability to other companies in our industry if those companies define or calculate these measures differently. Because of these limitations, our non-GAAP financial measures should not be considered measures of income generated by our business or discretionary cash available to us to invest in the growth of our business. Management compensates for these limitations by primarily relying on GAAP results and using non-GAAP financial measures on a supplemental basis.

Pursuant to the requirements of Regulation G and Regulation S-K, we have provided reconciliations of Base Revenue, Net Debt, Adjusted EBITDA, Adjusted operating ratio, Adjusted operating income, Adjusted net income, and Adjusted earnings per diluted share to the most comparable GAAP financial measures at the end of this press release.

Cautionary Statement Concerning Forward-Looking Statements

Financial information in this press release is preliminary and based upon information available to the Company as of the date of this press release. As such, this information remains subject to the completion of our quarterly review procedures, and the filing of the related Annual Report on Form 10-K, which could result in changes, some of which could be material, to the preliminary information provided in this press release.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. These statements generally may be identified by their use of terms or phrases such as "seeks," "expects," "estimates," "anticipates," "projects," "believes," "hopes," "plans," "goals," "intends," "may," "might," "likely," "will," "should," "would," "could," "potential," "predict," "continue," "strategy," "future" and terms or phrases of similar substance. In this press release, statements relating to future borrowing capacity under our credit facility are forward-looking statements. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, including the impacts and duration of the COVID-19 pandemic. In addition, there are other risks, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Accordingly, actual results may differ materially from those set forth in the forward-looking statements. Readers should review and consider the factors that may affect future results and other disclosures by the Company in its press releases, Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information, except as required by law. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this press release might not occur. All forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by this cautionary statement.

References to the "Company," "we," "us," "our" and words of similar expression refer to USA Truck Inc. and its subsidiaries.

About USA Truck

USA Truck provides comprehensive capacity solutions to a broad and diverse customer base throughout North America. Our Trucking and USAT Logistics divisions blend an extensive portfolio of asset and asset-light services, offering a balanced approach for our customers' supply chain management, including customized truckload, dedicated contract carriage, intermodal and third-party logistics freight management services. For more information, visit usa-truck.com.

This press release and related information will be available to interested parties at our investor relations website, http://investor.usa-truck.com.

Zachary King, EVP & CFO
(479) 471-2694
zachary.king@usa-truck.com

Michael Stephens, Investor Relations
(479) 471-2610
michael.stephens@usa-truck.com

USA TRUCK INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
(UNAUDITED)

		Three Months Ended
		March 31,
		2022				2021
		(in thousands, except per share data)
Operating revenue		$	201,063			$	158,505
Operating expenses:
Salaries, wages and employee benefits			41,887				36,555
Fuel and fuel taxes			17,037				11,444
Depreciation and amortization			8,024				9,570
Insurance and claims			6,623				5,809
Equipment rent			1,834				1,949
Operations and maintenance			8,515				7,066
Purchased transportation			98,319				74,103
Operating taxes and licenses			1,260				1,272
Communications and utilities			1,006				804
(Gain) loss on disposal of assets, net			(6,401	)			(177	)
Other			4,276				4,064
Total operating expenses		$	182,380			$	152,459
Operating income			18,683				6,046
Other expenses:
Interest expense, net			1,417				1,025
Other, net			68				61
Total other expenses, net			1,485				1,086
Income before income taxes			17,198				4,960
Income tax expense			4,087				1,363
Consolidated net income and comprehensive income		$	13,111			$	3,597
Net earnings per share:
Average shares outstanding (basic)			8,831				8,841
Basic earnings per share		$	1.48			$	0.41
Average shares outstanding (diluted)			9,043				9,007
Diluted earnings per share		$	1.45			$	0.40

GAAP TO NON-GAAP RECONCILIATIONS
(UNAUDITED)
ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION

		Three Months Ended
		March 31,
		2022			2021
		(in thousands)
Net income		$	13,111		$	3,597
Add:
Depreciation and amortization			8,024			9,570
Interest expense, net			1,417			1,025
Income tax expense			4,087			1,363
Non-cash equity compensation			748			168
Adjusted EBITDA		$	27,387		$	15,723

ADJUSTED NET INCOME RECONCILIATION

		Three Months Ended
		March 31,
		2022				2021
		(in thousands)
Net income		$	13,111			$	3,597
Adjusted for:
Amortization of acquisition related intangibles			322				323
Income tax effect of adjustments			(82	)			(82	)
Adjusted net income		$	13,351			$	3,838

ADJUSTED EARNINGS PER DILUTED SHARE RECONCILIATION

		Three Months Ended
		March 31,
		2022				2021
Earnings per diluted share		$	1.45			$	0.40
Adjusted for:
Amortization of acquisition related intangibles			0.04				0.04
Income tax effect of adjustments			(0.01	)			(0.01	)
Adjusted earnings per diluted share		$	1.48			$	0.43

NET DEBT RECONCILIATION

		March 31, 2022				December 31, 2021
		(in thousands)
Total current debt and financing lease liabilities		$	33,873			$	25,164
Long-term debt, less current maturities			57,188				63,355
Financing leases, less current maturities			70,033				56,274
Total Debt			161,094				144,793
Less: Cash, excluding restricted cash			(12,026	)			(947	)
Net Debt		$	149,068			$	143,846

ADJUSTED OPERATING RATIO RECONCILIATIONS

		Three Months Ended
		March 31,
Consolidated		2022				2021
		(in thousands)
Operating revenue		$	201,063			$	158,505
Less: fuel surcharge revenue			(24,658	)			(14,240	)
Base revenue		$	176,405			$	144,265
Operating expense		$	182,380			$	152,459
Adjusted for:
Amortization of acquisition related intangibles			(322	)			(323	)
Fuel surcharge revenue			(24,658	)			(14,240	)
Adjusted operating expense		$	157,400			$	137,896
Operating income		$	18,683			$	6,046
Adjusted operating income		$	19,005			$	6,369
Operating ratio			90.7	%			96.2	%
Adjusted operating ratio			89.2	%			95.6	%

		Three Months Ended
		March 31,
Trucking Segment		2022				2021
		(in thousands)
Operating revenue		$	116,028			$	102,776
Intersegment activity			43				327
Operating revenue (before intersegment eliminations)			116,071				103,103
Less: fuel surcharge revenue			(16,224	)			(10,319	)
Base revenue		$	99,847			$	92,784
Operating expense (before intersegment eliminations)		$	103,443			$	99,583
Adjusted for:
Amortization of acquisition related intangibles			(322	)			(323	)
Fuel surcharge revenue			(16,224	)			(10,319	)
Adjusted operating expense		$	86,897			$	88,941
Operating income		$	12,628			$	3,520
Adjusted operating income		$	12,950			$	3,843
Operating ratio			89.1	%			96.6	%
Adjusted operating ratio			87.0	%			95.9	%

		Three Months Ended
		March 31,
USAT Logistics Segment		2022				2021
		(in thousands)
Operating revenue		$	85,035			$	55,729
Intersegment activity			12,409				12,652
Operating revenue (before intersegment eliminations)			97,444				68,381
Less: fuel surcharge revenue			(8,440	)			(4,296	)
Base revenue		$	89,004			$	64,085
Operating expense (before intersegment eliminations)		$	91,389			$	65,855
Adjusted for:
Fuel surcharge revenue			(8,440	)			(4,296	)
Adjusted operating expense		$	82,949			$	61,559
Operating income		$	6,055			$	2,526
Adjusted operating income		$	6,055			$	2,526
Operating ratio			93.8	%			96.3	%
Adjusted operating ratio			93.2	%			96.1	%

USA TRUCK INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

Assets		March 31, 2022				December 31, 2021
Current assets:		(in thousands, except share data)
Cash and restricted cash (restricted cash of $8,567 and $405, respectively)		$	20,593			$	1,352
Accounts receivable, net of allowance for doubtful accounts of $278 and $490, respectively			109,856				100,166
Inventories			1,300				1,387
Prepaid expenses and other current assets			9,864				10,103
Total current assets			141,613				113,008
Property and equipment:
Land and structures			34,274				34,266
Revenue equipment			318,339				316,492
Service, office and other equipment			31,507				31,213
Property and equipment, at cost			384,120				381,971
Accumulated depreciation and amortization			(168,380	)			(175,024	)
Property and equipment, net			215,740				206,947
Operating leases - right of use assets			21,342				22,898
Goodwill			5,231				5,231
Other intangibles, net			13,493				13,815
Other assets			3,253				2,136
Total assets		$	400,672			$	364,035
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	43,098			$	36,378
Current portion of insurance and claims accruals			8,740				8,973
Accrued expenses			13,047				10,006
Current finance lease obligations			16,983				14,095
Current operating lease obligations			6,475				6,679
Long-term debt, current maturities			16,890				11,069
Total current liabilities			105,233				87,200
Other long-term liabilities			334				342
Long-term debt, less current maturities			57,188				63,355
Long-term finance lease obligations			70,033				56,274
Long-term operating lease obligations			15,287				16,644
Deferred income taxes			21,512				21,914
Insurance and claims accruals, less current portion			6,881				6,881
Total liabilities			276,468				252,610
Commitments and contingencies			-				-
Stockholders' equity:
Preferred Stock, $0.01 par value; 1,000,000 shares authorized; none issued			-				-
Common Stock, $0.01 par value; 30,000,000 shares authorized; issued 12,455,160 shares, and 12,263,030 shares, respectively			125				123
Additional paid-in capital			65,322				63,752
Retained earnings			116,394				103,283
Less treasury stock, at cost (3,446,463 shares, and 3,367,418 shares, respectively)			(57,637	)			(55,733	)
Total stockholders' equity			124,204				111,425
Total liabilities and stockholders' equity		$	400,672			$	364,035

SOURCE: USA Truck, Inc.

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FAQ

What were the earnings per share for USA Truck in Q1 2022?

Earnings per diluted share for USA Truck in Q1 2022 increased to $1.45, a 262.5% rise from the previous year.

How much did USA Truck's consolidated operating revenue increase in Q1 2022?

Consolidated operating revenue for USA Truck rose 26.8% to $201.1 million in Q1 2022.

What is the adjusted operating ratio for USA Truck's Trucking segment in Q1 2022?

The adjusted operating ratio for USA Truck's Trucking segment improved to 87.0% in Q1 2022.

What was the net income for USA Truck in Q1 2022?

USA Truck reported a net income of $13.1 million for Q1 2022, significantly up from $3.6 million in Q1 2021.

How did USAT Logistics perform in Q1 2022?

USAT Logistics achieved a revenue increase of 42.5%, totaling $97.4 million in Q1 2022.