Marten Transport(MRTN) - 2025 Q2 - Quarterly Results

Executive Summary & Financial Highlights Second Quarter 2025 Financial Performance Marten Transport reported a decrease in net income and diluted EPS for Q2 2025 compared to Q2 2024, alongside a decline in operating revenue. Operating income also saw a slight decrease, while operating expenses as a percentage of operating revenue remained relatively stable | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (YoY) | Percentage Change (YoY) | | :-------------------------------- | :-------------------- | :-------------------- | :----------- | :---------------------- | | Net Income | $7.2 | $7.9 | -$0.7 | -8.9% | | Diluted EPS | $0.09 | $0.10 | -$0.01 | -10.0% | | Operating Revenue | $229.9 | $246.2 | -$16.3 | -6.6% | | Operating Revenue (excl. fuel surcharges) | $203.8 | $213.5 | -$9.7 | -4.5% | | Fuel Surcharge Revenue | $26.1 | $32.7 | -$6.6 | -20.2% | | Operating Income | $9.7 | $10.0 | -$0.3 | -3.0% | | Operating Expenses as % of Operating Revenue | 95.8% | 95.9% | -0.1% | -0.1% | | Operating Expenses as % of Operating Revenue (net of fuel surcharges) | 95.2% | 95.3% | -0.1% | -0.1% | Six-Month Period 2025 Financial Performance For the first six months of 2025, Marten Transport experienced a significant reduction in net income and diluted EPS compared to the same period in 2024. Total operating revenue and operating income also declined, while operating expenses as a percentage of revenue increased | Metric | YTD 2025 (in millions) | YTD 2024 (in millions) | Change (YoY) | Percentage Change (YoY) | | :-------------------------------- | :-------------------- | :-------------------- | :----------- | :---------------------- | | Net Income | $11.5 | $17.5 | -$6.0 | -34.3% | | Diluted EPS | $0.14 | $0.22 | -$0.08 | -36.4% | | Operating Revenue | $453.1 | $495.9 | -$42.8 | -8.6% | | Operating Revenue (excl. fuel surcharges) | $399.6 | $429.3 | -$29.7 | -6.9% | | Fuel Surcharge Revenue | $53.5 | $66.6 | -$13.1 | -19.7% | | Operating Income | $15.6 | $22.2 | -$6.6 | -29.7% | | Operating Expenses as % of Operating Revenue | 96.6% | 95.5% | +1.1% | +1.1% | | Operating Expenses as % of Operating Revenue (net of fuel surcharges) | 96.1% | 94.8% | +1.3% | +1.4% | Management Commentary Executive Chairman Randolph L. Marten highlighted the continued value of the company's multifaceted business model, particularly dedicated and brokerage operations, despite significant pressure from a prolonged freight market recession characterized by oversupply, weak demand, inflationary operating costs, freight rate reductions, and network disruptions. The company remains focused on mitigating market impacts and investing in organic growth opportunities, anticipating positive effects from increased enforcement of English Language Proficiency and B-1 visa regulations - The company's earnings are heavily pressured by the considerable duration and depth of the freight market recession's oversupply and weak demand[8] - Cumulative impact of inflationary operating costs, freight rate reductions, and freight network disruptions are contributing to earnings pressure[8] - Marten Transport is focused on minimizing market impact, investing in profitable organic growth opportunities, and expects positive impacts from anticipated additional industry capacity exits due to increased enforcement of English Language Proficiency and B-1 visa regulations[9] Company Overview Business Description Marten Transport, Ltd. is a multifaceted transportation and distribution company specializing in time and temperature-sensitive and dry truck-based services across six distinct business platforms. It is a leading temperature-sensitive truckload carrier in the U.S., serving high-volume customers in the United States, Mexico, and Canada - Marten Transport offers a network of time and temperature-sensitive and dry truck-based transportation and distribution capabilities[10] - The company operates through six distinct business platforms: Temperature-Sensitive and Dry Truckload, Dedicated, Intermodal, Brokerage, and MRTN de Mexico[10] - Marten is a leading temperature-sensitive truckload carrier in the United States, specializing in transporting food, beverages, and other consumer packaged goods requiring temperature control, with services extending to Mexico and Canada[10] Forward-Looking Statements & Contacts The press release includes forward-looking statements subject to substantial risks and uncertainties, with actual results potentially differing materially. The company disclaims any obligation to update these statements. Contact information for key executives is provided - The report contains forward-looking statements regarding future growth and market impacts, which involve substantial risks and uncertainties[11] - Important factors that could cause actual results to differ are discussed in Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2024[11] - Contact information for CEO Tim Kohl, President Doug Petit, and EVP & CFO Jim Hinnendael is provided[12] Consolidated Financial Statements Consolidated Condensed Balance Sheets Marten Transport's balance sheet shows an increase in total assets and liabilities as of June 30, 2025, compared to December 31, 2024. Cash and cash equivalents significantly increased, while total stockholders' equity also saw a modest rise | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change | | :-------------------------------- | :------------ | :---------------- | :----- | | Cash and cash equivalents | $35,052 | $17,267 | +$17,785 | | Total current assets | $155,813 | $138,511 | +$17,302 | | Net property and equipment | $834,268 | $828,613 | +$5,655 | | Total assets | $991,816 | $968,757 | +$23,059 | | Total current liabilities | $116,685 | $93,519 | +$23,166 | | Total liabilities | $221,100 | $200,835 | +$20,265 | | Total stockholders' equity | $770,716 | $767,922 | +$2,794 | Consolidated Condensed Statements of Operations The statements of operations reveal a decline in operating revenue, operating income, and net income for both the three-month and six-month periods ended June 30, 2025, compared to the prior year. This was accompanied by a decrease in diluted EPS, while dividends declared per common share remained constant | Metric (in thousands, except per share) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------------- | :------ | :------ | :------- | :------- | | Operating revenue | $229,922 | $246,238 | $453,074 | $495,910 | | Total operating expenses | $220,188 | $236,264 | $437,481 | $473,686 | | Operating income | $9,734 | $9,974 | $15,593 | $22,224 | | Net income | $7,186 | $7,889 | $11,521 | $17,535 | | Diluted earnings per common share | $0.09 | $0.10 | $0.14 | $0.22 | | Dividends declared per common share | $0.06 | $0.06 | $0.12 | $0.12 | Segment Performance Analysis Three Months Ended June 30, 2025 vs 2024 For Q2 2025, Truckload operating income significantly increased by 110.2% despite a revenue decrease, driven by an improved operating ratio. Dedicated and Brokerage segments saw declines in both revenue and operating income, while Intermodal continued to report an operating loss with a higher operating ratio | Segment (in thousands) | Q2 2025 Revenue | Q2 2024 Revenue | Revenue Change (YoY) | Q2 2025 Operating Income/(Loss) | Q2 2024 Operating Income/(Loss) | Operating Income Change (YoY) | Q2 2025 Operating Ratio | Q2 2024 Operating Ratio | | :--------------------- | :-------------- | :-------------- | :------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------- | :---------------------- | | Truckload | $106,486 | $112,523 | -5.4% | $2,344 | $1,115 | +110.2% | 97.8% | 99.0% | | Dedicated | $71,874 | $81,266 | -11.6% | $5,429 | $6,650 | -18.4% | 92.4% | 91.8% | | Intermodal | $11,703 | $15,064 | -22.3% | ($735) | ($684) | -7.5% | 106.3% | 104.5% | | Brokerage | $39,859 | $37,385 | +6.6% | $2,696 | $2,893 | -6.8% | 93.2% | 92.3% | | Total | $229,922 | $246,238 | -6.6% | $9,734 | $9,974 | -2.4% | 95.8% | 95.9% | Six Months Ended June 30, 2025 vs 2024 For the first six months of 2025, total operating revenue decreased across all segments except Brokerage, which saw a slight decline. Truckload operating income increased, but Dedicated, Intermodal, and Brokerage segments experienced significant drops in operating income, leading to a substantial consolidated operating income decrease of 29.8% | Segment (in thousands) | YTD 2025 Revenue | YTD 2024 Revenue | Revenue Change (YoY) | YTD 2025 Operating Income/(Loss) | YTD 2024 Operating Income/(Loss) | Operating Income Change (YoY) | YTD 2025 Operating Ratio | YTD 2024 Operating Ratio | | :--------------------- | :--------------- | :--------------- | :------------------- | :------------------------------- | :------------------------------- | :---------------------------- | :----------------------- | :----------------------- | | Truckload | $210,877 | $224,074 | -5.9% | $2,044 | $1,604 | +27.4% | 99.0% | 99.3% | | Dedicated | $145,499 | $167,726 | -13.3% | $10,283 | $15,908 | -35.4% | 92.9% | 90.5% | | Intermodal | $23,820 | $31,036 | -23.3% | ($1,590) | ($878) | -81.1% | 106.7% | 102.8% | | Brokerage | $72,878 | $73,074 | -0.3% | $4,856 | $5,590 | -13.1% | 93.3% | 92.4% | | Total | $453,074 | $495,910 | -8.6% | $15,593 | $22,224 | -29.8% | 96.6% | 95.5% | Operating Statistics & Cash Flow Operating Statistics by Segment Operational statistics for Q2 and YTD 2025 show varied performance across segments. Truckload and Dedicated segments experienced decreases in average tractors and total miles, while Brokerage loads increased. Average revenue per tractor per week saw slight increases in Truckload and Dedicated segments Truckload Segment Operating Statistics | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------------- | :------ | :------ | :------- | :------- | | Revenue (in thousands) | $106,486 | $112,523 | $210,877 | $224,074 | | Average revenue, net of fuel surcharges, per tractor per week | $4,209 | $4,093 | $4,203 | $4,044 | | Average tractors | 1,690 | 1,805 | 1,680 | 1,817 | | Total miles (in thousands) | 39,221 | 40,847 | 77,494 | 80,550 | Dedicated Segment Operating Statistics | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------------- | :------ | :------ | :------- | :------- | | Revenue (in thousands) | $71,874 | $81,266 | $145,499 | $167,726 | | Average revenue, net of fuel surcharges, per tractor per week | $3,807 | $3,754 | $3,827 | $3,768 | | Average tractors | 1,239 | 1,382 | 1,251 | 1,421 | | Total miles (in thousands) | 25,132 | 28,231 | 50,368 | 57,311 | Intermodal and Brokerage Segment Operating Statistics | Segment | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------- | :--------------------- | :------ | :------ | :------- | :------- | | Intermodal | Revenue (in thousands) | $11,703 | $15,064 | $23,820 | $31,036 | | | Loads | 3,555 | 4,464 | 7,212 | 9,053 | | | Average tractors | 77 | 121 | 77 | 123 | | Brokerage | Revenue (in thousands) | $39,859 | $37,385 | $72,878 | $73,074 | | | Loads | 24,094 | 22,700 | 44,510 | 42,761 | Cash Flow Activities Net cash provided by operating activities decreased for both the three-month and six-month periods ended June 30, 2025, compared to the prior year. Net cash used for investing activities increased in Q2 but decreased for the six-month period, while net cash used for financing activities saw a slight increase | Cash Flow Activity (in thousands) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------- | :------- | | Net cash provided by operating activities | $33,153 | $35,821 | $69,368 | $81,543 | | Net cash used for investing activities | ($33,115) | ($27,776) | ($41,528) | ($48,025) | | Net cash used for financing activities | ($4,891) | ($4,576) | ($10,055) | ($9,532) | Key Equipment and Share Data As of June 30, 2025, Marten Transport reported a decrease in total tractors and trailers compared to the prior year. The average age of company tractors increased, while the average age of trailers remained constant. Weighted average shares outstanding saw a slight increase | Metric | June 30, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Total tractors | 2,928 | 3,126 | | Average age of company tractors (in years) | 2.1 | 1.8 | | Total trailers | 5,164 | 5,539 | | Average age of company trailers (in years) | 5.0 | 5.0 | | Ratio of trailers to tractors | 1.8 | 1.8 | | Total refrigerated containers | 786 | 787 | Weighted Average Shares Outstanding | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------- | :------- | | Basic | 81,510 | 81,381 | 81,502 | 81,365 | | Diluted | 81,517 | 81,446 | 81,512 | 81,442 |