Delaware
|
36-4007085
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
incorporation
of organization)
|
Identification
No.)
|
Burlington
Northern Santa Fe
|
Florida
East Coast
|
Canadian
National
|
Kansas
City Southern
|
Canadian
Pacific
|
Norfolk
Southern
|
CSX
|
Union
Pacific
|
Name
|
Age
|
Position
|
David
P. Yeager
|
55
|
Chairman
of the Board of Directors and Chief Executive Officer
|
Mark
A. Yeager
|
44
|
Vice
Chairman of the Board of Directors, President and Chief Operating
Officer
|
Christopher
R. Kravas
|
43
|
Chief
Intermodal Officer
|
David
L. Marsh
|
41
|
Chief
Marketing Officer
|
Terri
A. Pizzuto
|
50
|
Executive
Vice President, Chief Financial Officer and Treasurer
|
James
B. Gaw
|
58
|
Executive
Vice President-Sales
|
Dwight
C. Nixon
|
46
|
Executive
Vice President-Highway
|
Donald
G. Maltby
|
54
|
Executive
Vice President-Logistics
|
Dennis
R. Polsen
|
55
|
Executive
Vice President-Information Services
|
David
C. Zeilstra
|
39
|
Vice
President, Secretary and General
Counsel
|
Item
5.
|
MARKET
FOR REGISTRANTS COMMON EQUITY AND RELATED SHAREHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
|
2008
|
2007
|
|||||||||||||||
High
|
Low
|
High
|
Low
|
|||||||||||||
First
Quarter
|
$ | 35.17 | $ | 22.77 | $ | 33.52 | $ | 28.56 | ||||||||
Second
Quarter
|
$ | 36.32 | $ | 30.90 | $ | 37.83 | $ | 28.98 | ||||||||
Third
Quarter
|
$ | 41.75 | $ | 31.31 | $ | 38.96 | $ | 29.94 | ||||||||
Fourth
Quarter
|
$ | 36.50 | $ | 21.82 | $ | 33.39 | $ | 23.69 |
Selected
Financial Data
|
||||||||||||||||||||||
(in
thousands except per share data)
|
||||||||||||||||||||||
Years
Ended December 31,
|
||||||||||||||||||||||
2008
|
2007
|
2006
(2)
|
2005 |
2004
|
|
|||||||||||||||||
Statement
of Income Data:
|
||||||||||||||||||||||
Revenue
|
$ | 1,860,608 | $ | 1,658,168 | $ | 1,609,529 | $ | 1,481,878 | $ | 1,380,722 | ||||||||||||
Gross
margin
|
234,311 | 232,324 | 218,418 | 174,742 | 167,062 | |||||||||||||||||
Operating
income
|
95,462 | 90,740 | 77,236 | 47,904 | 38,104 | |||||||||||||||||
Income
from continuing operations before taxes
|
96,326 | 93,228 | 79,508 | 48,871 | 27,551 | |||||||||||||||||
Income
from continuing operations after taxes
|
59,245 | 59,799 | 47,705 | 29,176 | 15,870 | |||||||||||||||||
Income
from discontinued operations, net of tax (1)
|
- | - | 981 | 3,770 | 1,409 | |||||||||||||||||
Net
income
|
$ | 59,245 | $ | 59,799 | $ | 48,686 | $ | 32,946 | $ | 17,279 | ||||||||||||
Basic
earnings per common share
|
||||||||||||||||||||||
Income
from continuing operations
|
$ | 1.59 | $ | 1.55 | $ | 1.19 | $ | 0.73 | $ | 0.45 | ||||||||||||
Income
from discontinued operations
|
$ | - | $ | - | $ | 0.03 | $ | 0.10 | $ | 0.04 | ||||||||||||
Diluted
earnings per common share
|
||||||||||||||||||||||
Income
from continuing operations
|
$ | 1.58 | $ | 1.53 | $ | 1.17 | $ | 0.71 | $ | 0.42 | ||||||||||||
Income
from discontinued operations
|
$ | - | $ | - | $ | 0.02 | $ | 0.09 | $ | 0.04 | ||||||||||||
As
of December 31,
|
||||||||||||||||||||||
2008
|
2007 |
2006
(2)
|
2005 |
2004
|
|
|
||||||||||||||||
Balance
Sheet Data:
|
||||||||||||||||||||||
Total
assets
|
$ | 531,676 | $ | 491,967 | $ | 484,548 | $ | 444,418 | $ | 410,845 | ||||||||||||
Long-term
debt, excluding current portion
|
- | - | - | - | - | |||||||||||||||||
Stockholders'
equity
|
315,184 | 250,899 | 258,844 | 242,075 | 226,936 |
(1)
|
HGDS
disposed of May 1, 2006
|
(2)
|
Comtrak
was acquired February 28, 2006
|
·
|
the
degree and rate of market growth in the domestic intermodal, truck
brokerage and logistics markets served by
us;
|
·
|
deterioration
in our relationships with existing railroads or adverse changes to the
railroads’ operating rules;
|
·
|
changes
in rail service conditions or adverse weather
conditions;
|
·
|
further
consolidation of railroads;
|
·
|
the
impact of competitive pressures in the marketplace, including entry of new
competitors, direct marketing efforts by the railroads or marketing
efforts of asset-based carriers;
|
·
|
changes
in rail, drayage and trucking company
capacity;
|
·
|
railroads
moving away from ownership of intermodal
assets;
|
·
|
equipment
shortages or equipment surplus;
|
·
|
changes
in the cost of services from rail, drayage, truck or other
vendors;
|
·
|
increases
in costs for independent contractors due to regulatory, judicial and legal
changes;
|
·
|
labor
unrest in the rail, drayage or trucking company
communities;
|
·
|
general
economic and business conditions;
|
·
|
significant
deterioration in our customers’ financial condition, particularly in the
retail and durable goods sectors;
|
·
|
fuel
shortages or fluctuations in fuel
prices;
|
·
|
increases
in interest rates;
|
·
|
changes
in homeland security or terrorist
activity;
|
·
|
difficulties
in maintaining or enhancing our information technology
systems;
|
·
|
changes
to or new governmental regulation;
|
·
|
loss
of several of our largest
customers;
|
·
|
inability
to recruit and retain key
personnel;
|
·
|
inability
to recruit and maintain drivers and owner
operators;
|
·
|
changes
in insurance costs and claims
expense;
|
·
|
changes
to current laws which will aid union organizing efforts;
and
|
·
|
inability
to close and successfully integrate any future business
combinations.
|
Twelve
Months Ended
|
||||||||||||
December
31,
|
||||||||||||
%
|
||||||||||||
2008
|
2007
|
Change
|
||||||||||
Revenue
|
||||||||||||
Intermodal
|
$ | 1,329,382 | $ | 1,206,364 | 10.2 | % | ||||||
Brokerage
|
372,337 | 322,465 | 15.5 | % | ||||||||
Logistics
|
158,889 | 129,339 | 22.8 | % | ||||||||
Total
revenue
|
$ | 1,860,608 | $ | 1,658,168 | 12.2 | % |
Twelve
Months Ended
|
||||||||
December
31,
|
||||||||
2008
|
2007
|
|||||||
Revenue
|
100.0 | % | 100.0 | % | ||||
Transportation
costs
|
87.4 | 86.0 | ||||||
Gross
margin
|
12.6 | 14.0 | ||||||
Costs
and expenses:
|
||||||||
Salaries
and benefits
|
5.0 | 5.8 | ||||||
General
and administration
|
2.3 | 2.5 | ||||||
Depreciation
and amortization
|
0.2 | 0.2 | ||||||
Total
costs and expenses
|
7.5 | 8.5 | ||||||
Operating
income
|
5.1 | 5.5 | ||||||
Other
income (expense):
|
||||||||
Interest
and dividend income
|
0.1 | 0.1 | ||||||
Total
other income
|
0.1 | 0.1 | ||||||
Income
before provision for income taxes
|
5.2 | 5.6 | ||||||
Provision
for income taxes
|
2.0 | 2.0 | ||||||
Net
income
|
3.2 | % | 3.6 | % | ||||
Twelve
Months Ended
|
||||||||||||
December
31,
|
||||||||||||
%
|
||||||||||||
2007
|
2006
|
Change
|
||||||||||
Revenue
|
||||||||||||
Intermodal
|
$ | 1,206,364 | $ | 1,172,566 | 2.9 | % | ||||||
Brokerage
|
322,465 | 306,332 | 5.3 | % | ||||||||
Logistics
|
129,339 | 130,631 | (1.0 | %) | ||||||||
Total
revenue from continuing operations
|
$ | 1,658,168 | $ | 1,609,529 | 3.0 | % |
Twelve
Months Ended
|
||||||||
December
31,
|
||||||||
2007
|
2006
|
|||||||
Revenue
|
100.0 | % | 100.0 | % | ||||
Transportation
costs
|
86.0 | 86.4 | ||||||
Gross
margin
|
14.0 | 13.6 | ||||||
Costs
and expenses:
|
||||||||
Salaries
and benefits
|
5.8 | 5.9 | ||||||
General
and administration
|
2.5 | 2.5 | ||||||
Depreciation
and amortization
|
0.2 | 0.4 | ||||||
Total
costs and expenses
|
8.5 | 8.8 | ||||||
Operating
income
|
5.5 | 4.8 | ||||||
Other
income (expense):
|
||||||||
Interest
and dividend income
|
0.1 | 0.1 | ||||||
Total
other income
|
0.1 | 0.1 | ||||||
Income
from continuing operations before
provision
for income taxes
|
5.6 | 4.9 | ||||||
Provision
for income taxes
|
2.0 | 1.9 | ||||||
Income
from continuing operations
|
3.6 | % | 3.0 | % | ||||
2009
|
$ | 21,042 | ||
2010
|
18,353 | |||
2011
|
16,696 | |||
2012
|
13,937 | |||
2013
|
5,120 | |||
2014
and thereafter
|
1,839 | |||
$ | 76,987 |
2009
|
$ | 715 | ||
2010
|
1,594 | |||
2011
|
427 | |||
2012
|
565 | |||
2013
|
478 | |||
2014
and thereafter
|
5,039 | |||
$ | 8,818 |
Report
of Independent Registered Public Accounting Firm
|
26 | |||
Consolidated
Balance Sheets – December 31, 2008 and December 31, 2007
|
27 | |||
Consolidated
Statements of Income – Years ended December 31, 2008, December 31, 2007
and December 31, 2006
|
28 | |||
Consolidated
Statements of Stockholders’ Equity – Years ended December 31,
2008,
December
31, 2007 and December 31, 2006
|
29 | |||
Consolidated
Statements of Cash Flows – Years ended December 31, 2008,
December
31, 2007 and December 31, 2006
|
30 | |||
Notes
to Consolidated Financial Statements
|
31 | |||
Schedule
II – Valuation and Qualifying Accounts
|
S-1 |
HUB
GROUP, INC.
|
||||||||
CONSOLIDATED
BALANCE SHEETS
|
||||||||
(in
thousands, except share amounts)
|
||||||||
December
31,
|
||||||||
2008
|
2007
|
|||||||
ASSETS
|
||||||||
CURRENT
ASSETS:
|
||||||||
Cash
and cash equivalents
|
$ | 85,799 | $ | 38,002 | ||||
Accounts
receivable
|
||||||||
Trade,
net
|
145,362 | 160,944 | ||||||
Other
|
10,318 | 9,828 | ||||||
Prepaid
taxes
|
123 | 86 | ||||||
Deferred
taxes
|
5,430 | 5,044 | ||||||
Prepaid
expenses and other current assets
|
4,346 | 4,318 | ||||||
TOTAL
CURRENT ASSETS
|
251,378 | 218,222 | ||||||
Restricted
investments
|
6,118 | 5,206 | ||||||
Property
and equipment, net
|
32,713 | 29,662 | ||||||
Other
intangibles, net
|
6,610 | 7,056 | ||||||
Goodwill,
net
|
233,110 | 230,448 | ||||||
Other
assets
|
1,747 | 1,373 | ||||||
TOTAL
ASSETS
|
$ | 531,676 | $ | 491,967 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
CURRENT
LIABILITIES:
|
||||||||
Accounts
payable
|
||||||||
Trade
|
$ | 105,064 | $ | 123,020 | ||||
Other
|
6,107 | 6,683 | ||||||
Accrued
expenses
|
||||||||
Payroll
|
9,988 | 16,446 | ||||||
Other
|
26,388 | 32,408 | ||||||
Related
party payable
|
- | 5,000 | ||||||
TOTAL
CURRENT LIABILITIES
|
147,547 | 183,557 | ||||||
Non-current
liabilities
|
9,535 | 10,363 | ||||||
Deferred
taxes
|
59,410 | 47,148 | ||||||
STOCKHOLDERS'
EQUITY:
|
||||||||
Preferred
stock, $.01 par value; 2,000,000 shares
authorized; no shares issued or outstanding in 2008 and
2007
|
- | - | ||||||
Common
stock
|
||||||||
Class
A: $.01 par value; 97,337,700 shares authorized and
41,224,792 shares issued in 2008 and 2007; 36,970,347 outstanding in 2008
and 36,666,731 shares outstanding in 2007
|
412 | 412 | ||||||
Class
B: $.01 par value; 662,300 shares authorized; 662,296 shares
issued and outstanding in 2008 and 2007
|
7 | 7 | ||||||
Additional
paid-in capital
|
174,355 | 176,657 | ||||||
Purchase
price in excess of predecessor basis, net of tax benefit of
$10,306
|
(15,458 | ) | (15,458 | ) | ||||
Retained
earnings
|
265,287 | 206,042 | ||||||
Treasury
stock; at cost, 4,254,445 shares in 2008 and 4,558,061 shares in
2007
|
(109,419 | ) | (116,761 | ) | ||||
TOTAL
STOCKHOLDERS' EQUITY
|
315,184 | 250,899 | ||||||
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY
|
$ | 531,676 | $ | 491,967 |
HUB
GROUP, INC.
|
||||||||||||
CONSOLIDATED
STATEMENTS OF INCOME
|
||||||||||||
(in
thousands, except per share amounts)
|
||||||||||||
Years
Ended
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Revenue
|
$ | 1,860,608 | $ | 1,658,168 | $ | 1,609,529 | ||||||
Transportation
costs
|
1,626,297 | 1,425,844 | 1,391,111 | |||||||||
Gross
margin
|
234,311 | 232,324 | 218,418 | |||||||||
Costs
and expenses:
|
||||||||||||
Salaries
and benefits
|
93,658 | 95,678 | 95,152 | |||||||||
General
and administrative
|
41,234 | 41,416 | 39,929 | |||||||||
Depreciation
and amortization
|
3,957 | 4,490 | 6,101 | |||||||||
Total
costs and expenses
|
138,849 | 141,584 | 141,182 | |||||||||
Operating
income
|
95,462 | 90,740 | 77,236 | |||||||||
Other
income (expense):
|
||||||||||||
Interest
expense
|
(102 | ) | (108 | ) | (115 | ) | ||||||
Interest
and dividend income
|
1,153 | 2,480 | 2,311 | |||||||||
Other,
net
|
(187 | ) | 116 | 76 | ||||||||
Total
other income
|
864 | 2,488 | 2,272 | |||||||||
Income
from continuing operations before provision for income
taxes
|
96,326 | 93,228 | 79,508 | |||||||||
Provision
for income taxes
|
37,081 | 33,429 | 31,803 | |||||||||
Income
from continuing operations
|
59,245 | 59,799 | 47,705 | |||||||||
Discontinued
operations:
|
||||||||||||
Income
from discontinued operations of HGDS (including loss on disposal of $70 in
2006)
|
- | - | 1,634 | |||||||||
Provision
for income taxes
|
- | - | 653 | |||||||||
Income
from discontinued operations
|
- | - | 981 | |||||||||
Net
income
|
$ | 59,245 | $ | 59,799 | $ | 48,686 | ||||||
Basic
earnings per common share
|
||||||||||||
Income
from continuing operations
|
$ | 1.59 | $ | 1.55 | $ | 1.19 | ||||||
Income
from discontinued operations
|
$ | - | $ | - | $ | 0.03 | ||||||
Net
income
|
$ | 1.59 | $ | 1.55 | $ | 1.22 | ||||||
Diluted
earnings per common share
|
||||||||||||
Income
from continuing operations
|
$ | 1.58 | $ | 1.53 | $ | 1.17 | ||||||
Income
from discontinued operations
|
$ | - | $ | - | $ | 0.02 | ||||||
Net
income
|
$ | 1.58 | $ | 1.53 | $ | 1.19 | ||||||
Basic
weighted average number of shares outstanding
|
37,174 | 38,660 | 39,958 | |||||||||
Diluted
weighted average number of shares outstanding
|
37,484 | 39,128 | 40,823 |
HUB
GROUP, INC
|
||||||||||||
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS’ EQUITY
|
||||||||||||
(in
thousands, except shares)
|
||||||||||||
Years
ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Class
A & B Common Stock Shares Outstanding
|
||||||||||||
Beginning
of year
|
37,329,027 | 39,605,418 | 40,624,780 | |||||||||
Purchase
of treasury shares
|
(85,361 | ) | (2,741,700 | ) | (2,126,255 | ) | ||||||
Treasury
shares issued for restricted stock and stock options
exercised
|
388,977 | 465,309 | 1,106,893 | |||||||||
Ending
balance
|
37,632,643 | 37,329,027 | 39,605,418 | |||||||||
Class
A & B Common Stock Amount
|
||||||||||||
Beginning
of year
|
$ | 419 | $ | 419 | $ | 419 | ||||||
Ending
balance
|
419 | 419 | 419 | |||||||||
Additional
Paid-in Capital
|
||||||||||||
Beginning
of year
|
176,657 | 179,203 | 183,524 | |||||||||
Equity
reclassification impact of adopting SFAS No. 123 (R)
|
- | - | (6,259 | ) | ||||||||
Exercise
of non-qualified stock options
|
(4,085 | ) | (6,668 | ) | (12,516 | ) | ||||||
Share-based
compensation expense
|
4,360 | 3,853 | 3,405 | |||||||||
Tax
benefit of share-based compensation plans
|
2,903 | 3,952 | 12,337 | |||||||||
Issuance
of restricted stock awards, net of forfeitures
|
(5,480 | ) | (3,683 | ) | (1,288 | ) | ||||||
Ending
balance
|
174,355 | 176,657 | 179,203 | |||||||||
Purchase
Price in Excess of Predecessor Basis, Net of Tax
|
||||||||||||
Beginning
of year
|
(15,458 | ) | (15,458 | ) | (15,458 | ) | ||||||
Ending
balance
|
(15,458 | ) | (15,458 | ) | (15,458 | ) | ||||||
Retained
Earnings
|
||||||||||||
Beginning
of year
|
206,042 | 146,243 | 97,557 | |||||||||
Net
income
|
59,245 | 59,799 | 48,686 | |||||||||
Ending
balance
|
265,287 | 206,042 | 146,243 | |||||||||
Unearned
Compensation
|
||||||||||||
Beginning
of year
|
- | - | (6,259 | ) | ||||||||
Equity
reclassification impact of adopting SFAS No. 123 (R)
|
- | - | 6,259 | |||||||||
Ending
balance
|
- | - | - | |||||||||
Treasury
Stock
|
||||||||||||
Beginning
of year
|
(116,761 | ) | (51,563 | ) | (17,708 | ) | ||||||
Purchase
of treasury shares
|
(2,630 | ) | (76,309 | ) | (49,622 | ) | ||||||
Issuance
of restricted stock and exercise of stock options
|
9,972 | 11,111 | 15,767 | |||||||||
Ending
balance
|
(109,419 | ) | (116,761 | ) | (51,563 | ) | ||||||
Total
stockholders’ equity
|
$ | 315,184 | $ | 250,899 | $ | 258,844 |
HUB
GROUP, INC.
|
||||||||||||
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
||||||||||||
(in
thousands)
|
||||||||||||
Years
Ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Cash
flows from operating activities:
|
||||||||||||
Income
from continuing operations
|
$ | 59,245 | $ | 59,799 | $ | 47,705 | ||||||
Adjustments
to reconcile income from continuing operations to net cash
|
||||||||||||
provided
by operating activities:
|
||||||||||||
Depreciation
and amortization
|
7,369 | 7,195 | 8,170 | |||||||||
Deferred
taxes
|
9,294 | 3,523 | 690 | |||||||||
Compensation
expense related to share-based compensation plans
|
4,360 | 3,853 | 3,405 | |||||||||
Gain
on sale of assets
|
(22 | ) | (160 | ) | (131 | ) | ||||||
Changes
in operating assets and liabilities excluding effects of
purchase
transaction:
|
||||||||||||
Restricted
investments
|
(912 | ) | (2,189 | ) | (1,630 | ) | ||||||
Accounts
receivable, net
|
15,092 | (4,119 | ) | 393 | ||||||||
Prepaid
taxes
|
(37 | ) | 2,033 | 3,317 | ||||||||
Prepaid
expenses and other current assets
|
(28 | ) | 132 | (297 | ) | |||||||
Other
assets
|
(374 | ) | 88 | (837 | ) | |||||||
Accounts
payable
|
(18,532 | ) | 4,223 | 5,698 | ||||||||
Accrued
expenses
|
(13,040 | ) | 4,094 | 8,496 | ||||||||
Non-current
liabilities
|
(908 | ) | 2,108 | 1,608 | ||||||||
Net
cash provided by operating activities
|
61,507 | 80,580 | 76,587 | |||||||||
Cash
flows from investing activities:
|
||||||||||||
Proceeds
from sale of equipment
|
1,342 | 725 | 394 | |||||||||
Purchases
of property and equipment
|
(10,732 | ) | (10,197 | ) | (8,372 | ) | ||||||
Cash used in acquisition of Comtrak, Inc.
|
(5,000 | ) | (5,000 | ) | (39,942 | ) | ||||||
Proceeds
from the disposal of discontinued operations
|
- | - | 12,203 | |||||||||
Net
cash used in investing activities
|
(14,390 | ) | (14,472 | ) | (35,717 | ) | ||||||
Cash
flows from financing activities:
|
||||||||||||
Proceeds
from stock options exercised
|
407 | 760 | 1,963 | |||||||||
Purchase
of treasury stock
|
(2,630 | ) | (76,309 | ) | (49,622 | ) | ||||||
Excess
tax benefits from share-based compensation
|
2,903 | 3,952 | 12,337 | |||||||||
Net
cash provided by (used in) financing activities
|
680 | (71,597 | ) | (35,322 | ) | |||||||
Cash
flows provided by operating activities of discontinued
operations
|
- | - | 1,848 | |||||||||
Cash
flows used in investing activities of discontinued
operations
|
- | - | (38 | ) | ||||||||
Net
cash provided by discontinued operations
|
- | - | 1,810 | |||||||||
Net
increase (decrease) in cash and cash equivalents
|
47,797 | (5,489 | ) | 7,358 | ||||||||
Cash
and cash equivalents beginning of year
|
38,002 | 43,491 | 36,133 | |||||||||
Cash
and cash equivalents end of year
|
$ | 85,799 | $ | 38,002 | $ | 43,491 | ||||||
Supplemental
disclosures of cash paid for:
|
||||||||||||
Interest
|
$ | 102 | $ | 106 | $ | 114 | ||||||
Income
taxes
|
$ | 27,199 | $ | 22,192 | $ | 16,801 | ||||||
The
accompanying notes to consolidated financial statements are an integral
part of these statements.
|
Year
Ended
|
Year
Ended
|
|||||||||||||||||||||||
December
31, 2008
|
December
31, 2007
|
|||||||||||||||||||||||
Income
|
Shares
|
Per
Share Amount
|
Income
|
Shares
|
Per
Share Amount
|
|||||||||||||||||||
Basic
EPS
|
||||||||||||||||||||||||
Net
Income
|
$ | 59,245 | 37,174 | $ | 1.59 | $ | 59,799 | 38,660 | $ | 1.55 | ||||||||||||||
Effect
of Dilutive Securities
|
||||||||||||||||||||||||
Stock
options and restricted stock
|
310 | 468 | ||||||||||||||||||||||
Diluted
EPS
|
||||||||||||||||||||||||
Net
Income
|
$ | 59,245 | 37,484 | $ | 1.58 | $ | 59,799 | 39,128 | $ | 1.53 |
Year
Ended
|
||||||||||||
December
31, 2006
|
||||||||||||
Income
|
Shares
|
Per
Share Amount
|
||||||||||
Basic
EPS
|
||||||||||||
Income
from continuing operations
|
$ | 47,705 | 39,958 | $ | 1.19 | |||||||
Income
from discontinued operations
|
981 | 39,958 | 0.03 | |||||||||
Net
Income
|
$ | 48,686 | 39,958 | $ | 1.22 | |||||||
Effect
of Dilutive Securities
|
||||||||||||
Stock
options and restricted stock
|
865 | |||||||||||
Diluted
EPS
|
||||||||||||
Income
from continuing operations
|
$ | 47,705 | 40,823 | $ | 1.17 | |||||||
Income
from discontinued operations
|
981 | 40,823 | 0.02 | |||||||||
Net
Income
|
$ | 48,686 | 40,823 | $ | 1.19 |
Years
Ended December 31,
|
||||||||
2008
|
2007
|
|||||||
Building
and improvements
|
$ | 54 | $ | 54 | ||||
Leasehold
improvements
|
1,700 | 1,372 | ||||||
Computer
equipment and software
|
50,366 | 49,304 | ||||||
Furniture
and equipment
|
7,995 | 7,894 | ||||||
Transportation
equipment
|
30,231 | 25,204 | ||||||
90,346 | 83,828 | |||||||
Less: Accumulated
depreciation and amortization
|
(57,633 | ) | (54,166 | ) | ||||
Property
and Equipment, net
|
$ | 32,713 | $ | 29,662 |
Years Ended December 31, | ||||||||||||
2008
|
2007
|
2006 | ||||||||||
U.S.
federal statutory rate
|
35.0 | % | 35.0 | % | 35.0 | % | ||||||
State
taxes, net of federal benefit
|
2.7 | 3.4 | 3.5 | |||||||||
Nondeductible
expenses
|
0.6 | 0.5 | 1.5 | |||||||||
Provision
for (reversal of) valuation allowance
|
- | 0.1 | (0.3 | ) | ||||||||
IRS
settlement
|
- | (1.4 | ) | - | ||||||||
Illinois
law change
|
- | (1.3 | ) | - | ||||||||
Other
|
0.2 | (0.4 | ) | 0.3 | ||||||||
Net
effective rate
|
38.5 | % | 35.9 | % | 40.0 | % |
Years Ended December 31, | ||||||||||||
Current
|
2008 | 2007 | 2006 | |||||||||
Federal
|
$ | 25,197 | $ | 26,234 | $ | 27,986 | ||||||
State
and local
|
2,590 | 3,672 | 3,078 | |||||||||
27,787 | 29,906 | 31,064 | ||||||||||
Deferred
|
||||||||||||
Federal
|
8,651 | 4,000 | 332 | |||||||||
State
and local
|
643 | (477 | ) | 407 | ||||||||
9,294 | 3,523 | 739 | ||||||||||
Total
provision
|
$ | 37,081 | $ | 33,429 | $ | 31,803 | ||||||
Years Ended December 31, | ||||||||
2008 | 2007 | |||||||
Reserve
for uncollectible accounts receivable
|
$ | 1,813 | $ | 1,939 | ||||
Accrued
compensation
|
5,612 | 5,394 | ||||||
Other
reserves
|
2,158 | 2,480 | ||||||
Current
deferred tax assets
|
9,583 | 9,813 | ||||||
Operating
loss carryforwards
|
386 | 430 | ||||||
Other
|
282 | 216 | ||||||
Income
tax basis in excess of financial basis of goodwill
|
1,588 | 2,383 | ||||||
Less
valuation allowance
|
(163 | ) | (163 | ) | ||||
Long-term
deferred tax assets
|
2,093 | 2,866 | ||||||
Total
deferred tax assets
|
$ | 11,676 | $ | 12,679 | ||||
Prepaids
|
$ | (1,200 | ) | $ | (1,245 | ) | ||
Other
receivables
|
(2,953 | ) | (3,524 | ) | ||||
Current
deferred tax liabilities
|
(4,153 | ) | (4,769 | ) | ||||
Property
and equipment
|
(7,393 | ) | (1,006 | ) | ||||
Goodwill
|
(54,110 | ) | (49,008 | ) | ||||
Long-term
deferred tax liabilities
|
(61,503 | ) | (50,014 | ) | ||||
Total
deferred tax liabilities
|
$ | (65,656 | ) | $ | (54,783 | ) |
Balance
at January 1, 2007
|
$ | 3.2 | ||
Reductions
as a result of a lapse of the applicable statute of
limitations
|
(2.9 | ) | ||
Balance
at December 31, 2007
|
$ | .3 | ||
Additions
for tax positions of prior years
|
.1 | |||
Balance
at December 31, 2008
|
$ | .4 |
2009
|
$ | 21,042 | ||
2010
|
18,353 | |||
2011
|
16,696 | |||
2012
|
13,937 | |||
2013
|
5,120 | |||
2014
and thereafter
|
1,839 | |||
$ | 76,987 |
Stock
Options
|
Shares
|
Weighted
Average Exercise
Price
|
Weighted
Average Remaining Contractual Life
|
Aggregate
Intrinsic
Value
|
||||||||||||
Outstanding
at January 1, 2008
|
441,332 | $ | 2.06 | |||||||||||||
Options
exercised
|
(175,332 | ) | $ | 2.32 | ||||||||||||
Options
forfeited
|
- | $ | - | |||||||||||||
Outstanding
at December 31, 2008
|
266,000 | $ | 1.89 | 3.69 | $ | 6,554,227 | ||||||||||
Exercisable
at December 31, 2008
|
266,000 | $ | 1.89 | 3.69 | $ | 6,554,227 |
Options
Outstanding and Exercisable
|
||||||||||||||||||||||
Range
of Exercise Prices
|
Number
of Shares
|
Weighted
Avg. Remaining Contractual Life
|
Weighted
Avg. Exercise Price
|
|
||||||||||||||||||
$ | 1.22 to $1.22 | 20,100 |
4.01
|
$ | 1.22 | |||||||||||||||||
$ | 1.22 to $1.30 | 123,000 |
3.96
|
$ | 1.30 | |||||||||||||||||
$ | 1.30 to $2.00 | 56,000 |
3.80
|
$ | 1.65 | |||||||||||||||||
$ | 2.00 to $2.64 | 40,800 |
4.29
|
$ | 2.57 | |||||||||||||||||
$ | 2.64 to $4.69 | 26,100 |
0.98
|
$ | 4.63 | |||||||||||||||||
$ | 1.22 to $4.69 | 266,000 |
3.69
|
$ | 1.89 |
Non-vested
restricted stock
|
Shares
|
Weighted
Average Grant Date Fair Value
|
||||||
Non-vested
January 1, 2008
|
336,690 | $ | 24.10 | |||||
Granted
|
226,152 | $ | 26.16 | |||||
Vested
|
(147,967 | ) | $ | 22.11 | ||||
Forfeited
|
(12,507 | ) | $ | 24.93 | ||||
Non-vested
at December 31, 2008
|
402,368 | $ | 25.96 |
Years
Ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Revenue
|
||||||||||||
Intermodal
|
$ | 1,329,382 | $ | 1,206,364 | $ | 1,172,566 | ||||||
Brokerage
|
372,337 | 322,465 | 306,332 | |||||||||
Logistics
|
158,889 | 129,339 | 130,631 | |||||||||
Total
revenue from continuing operations
|
$ | 1,860,608 | $ | 1,658,168 | $ | 1,609,529 |
Total
Number of Shares Purchased
|
Average
Price Paid Per Share
|
Total
Number of Shares Purchased as Part of Publicly Announced
Plans
|
Maximum
Value of Shares that May Yet Be Purchased Under the Plans (in
000’s)
|
|||||||||||||
January
1 to
March
31
|
- | $ | - | - | $ | 75,000 | ||||||||||
April
1 to
June
30
|
- | $ | - | - | $ | 75,000 | ||||||||||
July
1 to
September
30
|
38,800 | $ | 36.12 | 38,800 | $ | 73,598 | ||||||||||
October
1 to
December
31
|
- | $ | - | - | $ | 73,598 | ||||||||||
Total
|
38,800 | $ | 36.12 | 38,800 | $ | 73,598 |
March
1, 2006
|
||||
Accounts
receivable
|
||||
Trade,
net
|
$ | 9,012 | ||
Other
|
428 | |||
Prepaid
expenses and other current assets
|
294 | |||
Property
and equipment
|
13,507 | |||
Goodwill
|
12,298 | |||
Other
intangible assets
|
7,894 | |||
Total
assets acquired
|
$ | 43,433 | ||
Accounts
payable
|
||||
Trade
|
$ | 832 | ||
Other
|
1,166 | |||
Accrued
expenses
|
||||
Payroll
|
944 | |||
Other
|
549 | |||
Total
liabilities assumed
|
$ | 3,491 | ||
Net
assets acquired
|
$ | 39,942 | ||
Direct
acquisition costs
|
766 | |||
Purchase
price
|
$ | 39,176 |
Balance
at January 1, 2007
|
$ | 225,448 | ||
Contingent
earn-out payment
|
5,000 | |||
Balance
at December 31, 2007
|
230,448 | |||
Other
|
2,662 | |||
Balance
at December 31, 2008
|
$ | 233,110 |
Gross
Amount
|
Accumulated
Amortization
|
Net
Carrying Value
|
Life
|
||||||||||
As
of December 31, 2008:
|
|||||||||||||
Relationships
with owner operators
|
$ | 647 | $ | (306 | ) | $ | 341 |
6
years
|
|||||
Backlog/open
orders
|
20 | (20 | ) | - |
1
month
|
||||||||
Trade
name
|
2,904 | - | 2,904 |
Indefinite
|
|||||||||
Customer
relationships
|
3,823 | (722 | ) | 3,101 |
15 years
|
||||||||
Information
technology
|
500 | (236 | ) | 264 |
6
years
|
||||||||
Total
|
$ | 7,894 | $ | (1,284 | ) | $ | 6,610 | ||||||
As
of December 31, 2007:
|
|||||||||||||
Relationships
with owner operators
|
$ | 647 | $ | (198 | ) | $ | 449 |
6
years
|
|||||
Backlog/open
orders
|
20 | (20 | ) | - |
1
month
|
||||||||
Trade
name
|
2,904 | - | 2,904 |
Indefinite
|
|||||||||
Customer
relationships
|
3,823 | (467 | ) | 3,356 |
15 years
|
||||||||
Information
technology
|
500 | (153 | ) | 347 |
6
years
|
||||||||
Total
|
$ | 7,894 | $ | (838 | ) | $ | 7,056 | ||||||
2009
|
$ | 444 | ||
2010
|
444 | |||
2011
|
444 | |||
2012
|
285 | |||
2013
|
253 |
Four months ended May 1,
2006
|
||||
Revenue
|
$ | 19,194 | ||
Income
from discontinued operations
|
||||
before
income taxes
|
1,634 | |||
Income
tax provision
|
653 | |||
Income
from discontinued operations
|
$ | 981 |
May 1, 2006 | |||||
Assets | |||||
Accounts receivable-trade, net | $ | 8,845 | |||
Prepaid expenses and other current assets | 149 | ||||
Property and equipment, net | 670 | ||||
Goodwill, net | 7,026 | ||||
Other assets | 44 | ||||
Total assets of discontinued operations | $ | 16,734 | |||
Liabilities | |||||
Accounts
payable-trade
|
$ | 3,619 | |||
Accounts
payable-other
|
64 | ||||
Accrued
expenses-payroll
|
449 | ||||
Accrued
expenses-other
|
330 | ||||
Total liabilities of discontinued operations | $ | 4,462 |
Quarters
|
||||||||||||||||
First
|
Second
|
Third
|
Fourth
|
|||||||||||||
Year
Ended December 31, 2008:
|
||||||||||||||||
Revenue
|
$ | 424,995 | $ | 490,929 | $ | 514,212 | $ | 430,472 | ||||||||
Gross
margin
|
57,502 | 59,839 | 63,160 | 53,810 | ||||||||||||
Operating
income
|
20,988 | 24,070 | 27,283 | 23,121 | ||||||||||||
Net
income
|
13,135 | 14,970 | 16,930 | 14,210 | ||||||||||||
Basic
earnings per share
|
$ | 0.35 | $ | 0.40 | $ | 0.45 | $ | 0.38 | ||||||||
Diluted
earnings per share
|
$ | 0.35 | $ | 0.40 | $ | 0.45 | $ | 0.38 | ||||||||
Quarters
|
||||||||||||||||
First
|
Second
|
Third
|
Fourth
|
|||||||||||||
Year
Ended December 31, 2007:
|
||||||||||||||||
Revenue
|
$ | 393,297 | $ | 401,565 | $ | 417,842 | $ | 445,464 | ||||||||
Gross
margin
|
56,661 | 57,763 | 57,510 | 60,390 | ||||||||||||
Operating
income
|
18,278 | 22,165 | 24,734 | 25,563 | ||||||||||||
Net
income
|
11,419 | 13,775 | 16,608 | 17,997 | ||||||||||||
Basic
earnings per share
|
$ | 0.29 | $ | 0.35 | $ | 0.43 | $ | 0.48 | ||||||||
Diluted
earnings per share
|
$ | 0.29 | $ | 0.35 | $ | 0.42 | $ | 0.47 | ||||||||
Item
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
Item
9A.
|
CONTROLS
AND PROCEDURES
|
Plan
Category
|
Number
of securities
to
be issued
upon
exercise of
outstanding
options,
warrants
and rights
(a)
|
Weighted-average
exercise
price of
outstanding
options,
warrants
and rights
|
Number
of securities
remaining
available for
future
issuance under
equity
compensation
plans
(excluding
securities
reflected in column (a))
|
|||||||||
Equity
compensation
plans
approved by
security
holders
|
266,000 | $ | 1.89 | 2,120,955 | ||||||||
Equity
compensation
plans
not approved
by
security holders
|
-- | -- | -- | |||||||||
Total
|
266,000 | $ | 1.89 | 2,120,955 |
HUB GROUP, INC. | |||
Date:
February 17, 2009
|
By:
|
/s/ David P. Yeager | |
Name: David P. Yeager | |||
Title: Chairman and Chief Executive Officer | |||
Title
|
Date
|
|
/s/ David P.
Yeager
David
P. Yeager
|
Chairman
and Chief Executive Officer
|
February
17, 2009
|
/s/
Mark A. Yeager
Mark
A. Yeager
|
Vice
Chairman, President and Chief Operating Officer
|
February
17, 2009
|
/s/
Terri A. Pizzuto
Terri
A. Pizzuto
|
Executive
Vice President, Chief Financial Officer and Treasurer (Principal Financial
and Accounting Officer)
|
February
17, 2009
|
/s/
Charles R. Reaves
Charles
R. Reaves
|
Director
|
February
17, 2009
|
/s/
Martin P. Slark
Martin
P. Slark
|
Director
|
February
17, 2009
|
/s/
Gary D. Eppen
Gary
D. Eppen
|
Director
|
February
17,
2009
|
SCHEDULE
II
|
||||||||||||||||||||
HUB
GROUP, INC.
|
||||||||||||||||||||
VALUATION
AND QUALIFYING ACCOUNTS
|
||||||||||||||||||||
Balance
at
|
Charged
to
|
Charged
|
Balance
at
|
|||||||||||||||||
Beginning
|
Costs
&
|
To
Other
|
End
|
|||||||||||||||||
of
Year
|
Expenses
|
Accounts
(1)
|
Deductions
(2)
|
of
Year
|
||||||||||||||||
Year
Ended December 31:
|
||||||||||||||||||||
Allowance
for uncollectible trade accounts
|
||||||||||||||||||||
2008
|
$ | 5,456,000 | $ | 448,000 | $ | (802,000 | ) | $ | - | $ | 5,102,000 | |||||||||
2007
|
$ | 6,299,000 | $ | (63,000 | ) | $ | (780,000 | ) | $ | - | $ | 5,456,000 | ||||||||
2006
|
$ | 6,815,000 | $ | 138,000 | $ | 644,000 | $ | (1,298,000 | ) | $ | 6,299,000 | |||||||||
Deferred
tax valuation allowance
|
||||||||||||||||||||
Balance
at
|
Charged
to
|
Charged
|
Transferred
to
|
Balance
at
|
||||||||||||||||
Beginning
|
Costs
&
|
To
Other
|
Other
|
End
|
||||||||||||||||
of
Year
|
Expenses
|
Accounts
|
Accounts
(3)
|
of
Year
|
||||||||||||||||
2008
|
$ | 163,000 | $ | - | $ | - | $ | - | $ | 163,000 | ||||||||||
2007
|
$ | 248,000 | $ | 81,000 | $ | - | $ | (166,000 | ) | $ | 163,000 | |||||||||
2006
|
$ | 489,000 | $ | (241,000 | ) | $ | - | $ | - | $ | 248,000 |
(1)
|
Expected
customer account adjustments charged to revenue and write-offs, net of
recoveries
|
(2)
|
Reserve
adjustment
|
(3) | Establish FIN 48 liability |
|
3.1
|
Amended
Certificate of Incorporation of the Registrant (incorporated by reference
to Exhibit 3.1 to the Registrant’s quarterly report on Form 10-Q filed
July 23, 2007, File No. 000-27754)
|
|
3.2
|
By-Laws
of the Registrant (incorporated by reference to Exhibit 3.2 to the
Registrant’s registration statement on Form S-1, File No.
33-90210)
|
|
10.1
|
Amended
and Restated Limited Partnership Agreement of Hub City Canada, L.P.
(incorporated by reference to Exhibit 10.2 to the Registrants report on
Form 10-K dated March 26, 1997 and filed March 27, 1997, File No
000-27754)
|
|
10.2
|
Stockholders'
Agreement (incorporated by reference to Exhibit 10.7 to the Registrant’s
report on Form 10-K dated March 26, 1997 and filed March 27, 1997, File
No. 000-27754)
|
|
10.3
|
Hub
Group’s Nonqualified Deferred Compensation Plan Basic Plan Document as
amended and restated as of January 1, 2008 (incorporated by reference to
Exhibit 10.4 to the Registrant’s report on Form 10-K dated February 21,
2008 and filed February 22, 2008, File No.
000-27754)
|
|
10.4
|
Hub
Group’s Nonqualified Deferred Compensation Plan Adoption Agreement as
amended and restated as of January 1, 2008 (incorporated by reference to
Exhibit 10.5 to the Registrant’s report on Form 10-K dated February 21,
2008 and filed February 22, 2008, File No.
000-27754)
|
|
10.5
|
Description
of Executive Officer cash compensation for
2009
|
|
10.6
|
Director
compensation for 2009
|
|
10.7
|
Hub
Group’s 2002 Long Term Incentive Plan (as amended and restated effective
May 7, 2007) (incorporated by reference from Appendix B to the
Registrant’s definitive proxy statement on Schedule 14A dated and filed
March 26, 2007)
|
|
10.8
|
$40
million Credit Agreement dated as of March 23, 2005 among the Registrant,
Hub City Terminals, Inc. and Harris Trust and Savings
Bank (incorporated by reference to Exhibit 10.1 to the
Registrant’s report on Form 8-K dated March 23, 2005 and filed March 25,
2005, File No. 000-27754)
|
|
10.9
|
Lease
Agreement dated as of May 10, 2005, between Banc of America Leasing &
Capital, LLC and Hub City Terminals, Inc., with form of Schedule thereto
(incorporated by reference to Exhibit 10.1 to the Registrant’s report on
Form 8-K dated May 10, 2005 and filed May 16, 2005, File No.
000-27754)
|
|
10.10
|
Guaranty
of Corporation, dated as of May 10, 2005, made by Registrant to, and for
the benefit of, Banc of America Leasing & Capital, LLC (incorporated
by reference to Exhibit 10.2 to the Registrant’s report on Form 8-K dated
May 10, 2005 and filed May 16, 2005, File No.
000-27754)
|
|
10.11
|
Amendment
to the $40 million Credit Agreement among the Registrant, Hub City
Terminals, Inc. and Harris Trust and Savings Bank dated February 21,
2006 (incorporated by reference to Exhibit 10.16 to the
Registrant’s report on Form 10-K for the year ended December 31, 2005 and
filed February 27, 2006, File No.
000-27754)
|
|
10.12
|
Form
of Hub Group, Inc. 2006 Performance Unit Award Statement (incorporated by
reference to Exhibit 10.1 to the Registrant’s report on Form 8-K dated May
22, 2006 and filed May 26, 2006, File No.
000-27754)
|
|
10.13
|
Form
of Terms of Restricted Stock Award under Hub Group, Inc. 2002 Long-Term
Incentive Plan (incorporated by reference to Exhibit 10.2 to the
Registrant’s report on Form 8-K dated May 22, 2006 and filed May 26, 2006,
File No. 000-27754)
|
|
10.14
|
Equipment
Purchase Contract, dated as of March 8, 2007, by and between Hub City
Terminals, Inc., Singamas Management Services, Ltd. and Singamas North
America, Inc. (incorporated by reference to Exhibit 10.1 to the
Registrant’s report on Form 8-K filed March 12, 2007, File No.
000-27754)
|
|
10.15
|
Asset
Purchase Agreement, dated June 6, 2007, by and among Hub Group, Inc.,
Comtrak Logistics, Inc., Hub City Terminals, Inc., Interdom
Partners, Commercial Cartage, Inc., Pride Logistics, L.L.C. and the other
parties signatory thereto (incorporated by reference to Exhibit 10.1 to
the Registrant’s report on Form 8-K filed June 8, 2007, File No.
000-27754)
|
|
10.16
|
Termination
letter, dated July 9, 2007, by and among Comtrak Logistics, Inc., Hub City
Terminals, Inc., Interdom Partners, Commercial Cartage, Inc. and Pride
Logistics, L.L.C. (incorporated by reference to Exhibit 10.1 to the
Registrant’s report on Form 8-K filed July 10, 2007, File No.
000-27754)
|
|
14
|
Hub
Group’s Code of Business Conduct and Ethics (incorporated by reference
from Exhibit 99.2 to the Registrant’s report on Form 10-K dated March 12,
2003 and filed on March 13, 2003, File No.
000-27754)
|
|
21
|
Subsidiaries
of the Registrant
|
|
23.1
|
Consent
of Ernst & Young LLP
|
|
31.1
|
Certification
of David P. Yeager, Chairman and Chief Executive Officer, Pursuant to Rule
13a-14(a) promulgated under the Securities Exchange Act of
1934
|
|
31.2
|
Certification
of Terri A. Pizzuto, Executive Vice President, Chief Financial Officer and
Treasurer, Pursuant to Rule 13a-14(a) promulgated under the Securities
Exchange Act of 1934
|
|
32.1
|
Certification
of David P. Yeager and Terri A. Pizzuto, Chief Executive Officer and Chief
Financial Officer respectively, Pursuant to 18 U.S.C. Section
1350
|
SUBSIDIARIES
|
JURISDICTION
OF INCORPORATION/ORGANIZATION
|
Hub
City Terminals, Inc.
|
Delaware
|
Hub
Group Atlanta, LLC
|
Delaware
|
Hub
Group Canada, L.P.
|
Delaware
|
Hub
Group Associates, Inc.
|
Illinois
|
Hub
Group Distribution Services, LLC
|
Illinois
|
Quality
Services L.L.C.
|
Missouri
|
Hub
Chicago Holdings, Inc.
|
Delaware
|
Hub
Group Transport, LLC
|
Delaware
|
Hub
Freight Services, Inc.
|
Delaware
|
Comtrak
Logistics, Inc.
|
Delaware
|