Hub (US:HUBG)2022-05-05 16:00Revenue Growth - Total revenue increased by 41% to $1,298 million in Q1 2022 from $920 million in Q1 2021, driven by significant growth across all business lines [68]. - Intermodal and Transportation Solutions revenue rose 35% to $774 million, with a 35% increase in intermodal revenue per load and a 4% increase in intermodal volume [69]. - Truck Brokerage revenue surged 132% to $296 million, primarily due to the acquisition of Choptank and a 33% increase in revenue per load [69]. - Logistics revenue grew 6% to $229 million, supported by final mile and consolidation services, despite some customer losses [69]. - Top 50 customers accounted for approximately 63% of revenue for the three months ended March 31, 2022, with one customer exceeding 10% of quarterly revenue [65]. Cost and Expenses - Transportation costs increased by 34% to $1,083 million, with purchased transportation costs rising 40% due to higher business activity and increased fuel costs [70]. - Salaries and benefits rose to $69 million in 2022 from $57 million in 2021, but as a percentage of revenue, it decreased to 5.3% from 6.2% [72]. - General and administrative expenses rose to $20 million in 2022 from $19 million in 2021, but as a percentage of revenue, they decreased to 1.6% from 2.1% [75]. - Depreciation and amortization expense increased to $11 million in 2022 from $9 million in 2021, with a revenue percentage decrease to 0.8% from 0.9% [76]. Profitability - Gross margin increased by 98% to $215 million, with gross margin percentage rising to 16.6% from 11.8% [71]. - Net income surged to $88 million in 2022 from $17 million in 2021, driven by increased gross margin [79]. Cash Flow and Capital Expenditures - Cash provided by operating activities was $80 million for the three months ended March 31, 2022, down from $127 million in 2021, primarily due to a $74 million increase in accounts receivable [83]. - Capital expenditures for the three months ended March 31, 2022, totaled $31 million, with significant investments in tractors ($12 million) and containers ($11 million) [84]. - Estimated capital expenditures for 2022 are projected to range from $240 million to $265 million, with transportation equipment purchases expected between $210 million and $225 million [86]. - Net cash used in financing activities for the three months ended March 31, 2022, was $9 million, including long-term debt repayments of $26 million [87]. - As of March 31, 2022, the company had $207 million in cash and $21 million in restricted investments, with no borrowings under the Credit Agreement [81]. Operational Insights - The company plans to order approximately 6,500 new containers in 2022 to increase capacity and meet customer demand [64]. - The company anticipates ongoing uncertainties, including potential consumer spending slowdowns and rising inflation impacting revenue and profitability [66]. - Headcount increased to 2,277 as of March 31, 2022, from 1,958 in 2021, primarily due to the addition of Choptank employees [74]. - The company is continuously evaluating economic conditions and their impact on operational cash flows, particularly in the freight market [92].