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Ryder System (R)
Q1 2013 Earnings Call
April 23, 2013 11:00 am ET
Robert S. Brunn - Vice President of Corporate Strategy & Investor Relations
Robert E. Sanchez - Chief Executive Officer, President and Director
Art A. Garcia - Chief Financial Officer and Executive Vice President
Dennis C. Cooke - President of Global Fleet Management Solutions
John H. Williford - President of Global Supply Chain Solutions
Kevin W. Sterling - BB&T Capital Markets, Research Division
David G. Ross - Stifel, Nicolaus & Co., Inc., Research Division
Benjamin J. Hartford - Robert W. Baird & Co. Incorporated, Research Division
H. Peter Nesvold - Jefferies & Company, Inc., Research Division
Anthony P. Gallo - Wells Fargo Securities, LLC, Research Division
John L. Barnes - RBC Capital Markets, LLC, Research Division
Todd C. Fowler - KeyBanc Capital Markets Inc., Research Division
Scott H. Group - Wolfe Trahan & Co.
Arthur W. Hatfield - Raymond James & Associates, Inc., Research Division
Jeffrey A. Kauffman - Sterne Agee & Leach Inc., Research Division
Matthew S. Brooklier - Longbow Research LLC
Justin Long - Stephens Inc., Research Division
David P. Campbell - Thompson, Davis & Company
Previous Statements by R
» Ryder System Management Discusses Q4 2012 Results - Earnings Call Transcript
» Ryder System Management Discusses Q3 2012 Results - Earnings Call Transcript
» Ryder System Management Discusses Q2 2012 Results - Earnings Call Transcript
Robert S. Brunn
Thanks very much. Good morning, and welcome to Ryder's First Quarter 2013 Earnings Conference Call. I'd like to remind you that during this presentation, you'll hear some forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in economic, business, competitive, market, political and regulatory factors. More detailed information about these factors is contained in this morning's earnings release and in Ryder's filings with the Securities and Exchange Commission.
Presenting on today's call are Robert Sanchez, President and Chief Executive Officer; and Art Garcia, Executive Vice President and Chief Financial Officer. Additionally, Greg Swienton, Executive Chairman; Dennis Cooke, President of Global Fleet Management Solutions; and John Williford, President of Global Supply Chain Solutions are on the call today and available for questions following the presentation.
With that, let me turn it over to Robert.
Robert E. Sanchez
Good morning, everyone, and thanks for joining us. This morning, we'll recap our first quarter 2013 results, review the asset management area and discuss the current outlook for our business. We'll then open the call up for questions.
Before we get into the results, I'd like to take a minute to thank Greg Swienton for the many -- his many contributions to Ryder over the past 14 years. As most of you know, Greg will be retiring from the company as of our Annual Shareholders Meeting next Friday, May 3, although he'll still be available for us on a consulting basis for the next couple of years.
The impact that Greg has had on the company truly cannot be overstated. For those of you who were around in 1999 when Greg joined Ryder, you know that the company was facing a lot of challenges back then. Ryder is a much different company today, thanks to Greg's leadership. He was instrumental in changing so many things about Ryder. He earned the trust of our employees, customers and shareholders by ensuring that we deliver on our commitments. Greg focused us on what's important to our customers, made us accountable for the results and developed a strong team throughout all the areas of the company. Most importantly, Greg has given us a solid foundation for future growth. All of this has been done with the highest ethical standards and utmost integrity. Under Greg's tenure, we closed 18 accretive acquisitions, doubled the dividend and improved the free cash flow profile of the company. Greg's focus has driven significant improvements in our earnings, capital efficiency and return to shareholders.
On a personal level, Greg has been an invaluable mentor to me and so many other people in our company. I know that I speak on behalf of everyone at Ryder, when I say Greg will truly be missed here. But his legacy will live on in the company that we've become under his leadership. With that, I'll turn it to an overview of our first quarter results.
Net earnings per diluted share from continuing operations were $0.79 in the first quarter of 2013, up from $0.68 in the prior year period. First quarter results include $0.02 of net expense from nonoperating pension costs, partially offset by a foreign currency translation benefit.
The year-ago period included a $0.01 of net expense from acquisition-related restructuring and nonoperating pension cost, partially offset by the resolution of a tax matter. Excluding these items in both periods, comparable EPS were $0.81 in the first quarter, up from $0.69 in the prior year, an improvement of $0.12 or 17%.
Total revenue grew 2%. Operating revenue, which excludes FMS fuel and all subcontracted transportation revenue, was up 3%. These revenue increases reflect organic growth in Full Service Lease, as well as higher volumes in new business and supply chain.
Page 5 includes some additional financials for the first quarter. The average number of diluted shares outstanding for the quarter increased by 0.5 million shares to 51.4 million. This reflects the temporary pause in our anti-dilutive share repurchase program, which we discussed on our last call, and is somewhat above our plan due to the increased employee stock activity.
As of March 31, there were 51.9 million shares outstanding, of which 51.4 million are included in the diluted share calculation. The first quarter of 2013 tax rate was 34.7% and included the impact of nonoperating pension. Excluding this item, the comparable tax rate would be 36.2%. The prior year's tax rate of 26.9% benefited from the resolution of a tax matter, partially offset by nonoperating pension cost and restructuring charges. Excluding these items in 2012, the comparable tax rate would have been 37.3%.