SEC Filing | Universal Logistics Holdings, Inc.

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ulh-10q_20220702.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 2, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission File Number: 0-51142

UNIVERSAL LOGISTICS HOLDINGS, INC.

(Exact Name of Registrant as Specified in Its Charter)

Michigan

38-3640097

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

12755 E. Nine Mile Road

Warren, Michigan 48089

(Address, including Zip Code of Principal Executive Offices)

(586) 920-0100

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	ULH	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s common stock, no par value, outstanding as of August 8, 2022, was 26,277,549.

PART I – FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Consolidated Balance Sheets

(In thousands, except share data)

	July 2, 2022			December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	14,683		$	13,932
Marketable securities		8,237			8,031
Accounts receivable – net of allowance for doubtful accounts of $11,667 and $7,841, respectively		400,017			341,398
Other receivables		24,636			26,318
Prepaid expenses and other		33,613			30,209
Due from affiliates		1,443			807
Total current assets		482,629			420,695
Property and equipment – net of accumulated depreciation of $356,211 and $333,833, respectively		343,729			345,583
Operating lease right-of-use asset		106,149			105,859
Goodwill		170,730			170,730
Intangible assets – net of accumulated amortization of $114,586 and $107,461, respectively		81,224			88,349
Deferred income taxes		2,060			2,060
Other assets		4,945			4,215
Total assets	$	1,191,466		$	1,137,491
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	118,650		$	117,837
Current portion of long-term debt		52,448			61,160
Current portion of operating lease liabilities		28,259			24,566
Accrued expenses and other current liabilities		43,953			43,627
Insurance and claims		39,770			43,357
Due to affiliates		14,232			17,839
Income taxes payable		10,539			4,323
Total current liabilities		307,851			312,709
Long-term liabilities:
Long-term debt, net of current portion		362,868			366,188
Operating lease liabilities, net of current portion		83,584			85,984
Deferred income taxes		61,250			61,250
Other long-term liabilities		8,946			9,150
Total long-term liabilities		516,648			522,572
Shareholders' equity:
Common stock, no par value. Authorized 100,000,000 shares; 30,995,734 and 30,986,702 shares issued; 26,277,549 and 26,919,455 shares outstanding, respectively		30,995			30,988
Paid-in capital		4,794			4,639
Treasury stock, at cost; 4,718,185 and 4,067,247 shares, respectively		(96,690	)		(82,385	)
Retained earnings		437,182			356,071
Accumulated other comprehensive (loss):
Interest rate swaps, net of income taxes of $(193) and $(60), respectively		(567	)		(178	)
Foreign currency translation adjustments		(8,747	)		(6,925	)
Total shareholders’ equity		366,967			302,210
Total liabilities and shareholders’ equity	$	1,191,466		$	1,137,491

See accompanying notes to consolidated financial statements.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Consolidated Statements of Income

(In thousands, except per share data)

	Thirteen Weeks Ended						Twenty-six Weeks Ended
	July 2, 2022			July 3, 2021			July 2, 2022			July 3, 2021
Operating revenues:
Truckload services	$	61,061		$	58,880		$	118,544		$	118,582
Brokerage services		101,929			102,532			209,101			199,451
Intermodal services		156,865			106,601			314,478			210,318
Dedicated services		79,452			50,396			154,938			98,357
Value-added services		127,875			104,374			253,982			211,307
Total operating revenues		527,182			422,783			1,051,043			838,015
Operating expenses:
Purchased transportation and equipment rent		227,215			198,031			459,346			387,363
Direct personnel and related benefits		127,334			111,000			264,002			218,552
Operating supplies and expenses		46,027			32,713			88,151			69,805
Commission expense		10,757			8,570			20,780			15,894
Occupancy expense		10,001			9,389			20,196			17,569
General and administrative		11,541			9,693			21,603			18,869
Insurance and claims		2,598			5,735			11,180			12,070
Depreciation and amortization		27,058			16,339			43,286			35,424
Total operating expenses		462,531			391,470			928,544			775,546
Income from operations		64,651			31,313			122,499			62,469
Interest income		6			14			6			32
Interest expense		(3,925	)		(2,940	)		(6,358	)		(6,121	)
Other non-operating income (expense)		(823	)		6,079			130			7,085
Income before income taxes		59,909			34,466			116,277			63,465
Income tax expense		15,210			8,862			29,570			16,205
Net income	$	44,699		$	25,604		$	86,707		$	47,260
Earnings per common share:
Basic	$	1.69		$	0.95		$	3.25		$	1.76
Diluted	$	1.69		$	0.95		$	3.25		$	1.75
Weighted average number of common shares outstanding:
Basic		26,453			26,919			26,660			26,918
Diluted		26,468			26,936			26,668			26,933
Dividends declared per common share	$	0.105		$	0.105		$	0.210		$	0.210

See accompanying notes to consolidated financial statements.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Consolidated Statements of Comprehensive Income

(In thousands)

	Thirteen Weeks Ended						Twenty-six Weeks Ended
	July 2, 2022			July 3, 2021			July 2, 2022			July 3, 2021
Net Income	$	44,699		$	25,604		$	86,707		$	47,260
Other comprehensive income (loss):
Unrealized changes in fair value of interest rate swaps, net of income taxes of $(215), $2, $(133) and $35, respectively		(630	)		30			(389	)		163
Foreign currency translation adjustments		1,012			(666	)		(1,822	)		401
Total other comprehensive income (loss)		382			(636	)		(2,211	)		564
Total comprehensive income	$	45,081		$	24,968		$	84,496		$	47,824

See accompanying notes to consolidated financial statements.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Consolidated Statements of Cash Flows

(In thousands)

	Twenty-six Weeks Ended
	July 2, 2022			July 3, 2021
Cash flows from operating activities:
Net income	$	86,707		$	47,260
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		43,286			35,424
Noncash lease expense		14,337			12,873
Gain on marketable equity securities		(92	)		(1,384	)
Gain on disposal of property and equipment		(2,743	)		(721	)
Amortization of debt issuance costs		207			240
Write-off of debt issuance costs		583			—
Stock-based compensation		162			162
Provision for doubtful accounts		5,501			2,597
Deferred income taxes		133			(21	)
Change in assets and liabilities:
Trade and other accounts receivable		(64,438	)		(32,999	)
Prepaid expenses and other assets		(4,424	)		(2,460	)
Principal reduction in operating lease liabilities		(13,085	)		(12,232	)
Accounts payable, accrued expenses and other current liabilities, insurance and claims, and income taxes payable		8,154			7,637
Due to/from affiliates, net		(4,243	)		(2,916	)
Other long-term liabilities		(727	)		(4	)
Net cash provided by operating activities		69,318			53,456
Cash flows from investing activities:
Capital expenditures		(37,544	)		(16,941	)
Proceeds from the sale of property and equipment		5,567			3,878
Purchases of marketable securities		(114	)		(114	)
Proceeds from sale of marketable securities		—			117
Net cash used in investing activities		(32,091	)		(13,060	)
Cash flows from financing activities:
Proceeds from borrowing - revolving debt		262,065			191,947
Repayments of debt - revolving debt		(274,828	)		(192,820	)
Proceeds from borrowing - term debt		193,926			3,946
Repayments of debt - term debt		(192,262	)		(31,276	)
Dividends paid		(8,422	)		(8,480	)
Capitalized financing costs		(1,723	)		—
Purchases of treasury stock		(14,305	)		—
Net cash used in financing activities		(35,549	)		(36,683	)
Effect of exchange rate changes on cash and cash equivalents		(927	)		622
Net increase in cash		751			4,335
Cash and cash equivalents – beginning of period		13,932			8,763
Cash and cash equivalents – end of period	$	14,683		$	13,098
Supplemental cash flow information:
Cash paid for interest	$	5,638		$	5,993
Cash paid for income taxes	$	23,368		$	22,909

See accompanying notes to consolidated financial statements.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Unaudited Consolidated Statements of Shareholders’ Equity

(In thousands, except per share data)

	Common stock		Paid-in capital		Treasury stock			Retained earnings			Accumulated other comprehensive income (loss)			Total
Balances – December 31, 2020	$	30,981	$	4,484	$	(82,385	)	$	293,643		$	(7,150	)	$	239,573
Net income		—		—		—			21,656			—			21,656
Comprehensive income		—		—		—			—			1,200			1,200
Dividends ($0.105 per share)		—		—		—			(2,865	)		—			(2,865	)
Stock based compensation		7		155					—			—			162
Balances - April 3, 2021		30,988		4,639		(82,385	)		312,434			(5,950	)		259,726
Net income		—		—		—			25,604			—			25,604
Comprehensive income		—		—		—			—			(636	)		(636	)
Dividends ($0.105 per share)		—		—		—			(2,786	)		—			(2,786	)
Balances – July 3, 2021	$	30,988	$	4,639	$	(82,385	)	$	335,252		$	(6,586	)	$	281,908

Balances – December 31, 2021	$	30,988	$	4,639	$	(82,385	)	$	356,071		$	(7,103	)	$	302,210
Net income		—		—		—			42,008			—			42,008
Comprehensive income		—		—		—			—			(2,593	)		(2,593	)
Purchases of treasury stock		—		—		(5,254	)		—			—			(5,254	)
Dividends ($0.105 per share)		—