- Fourth Quarter 2022 Operating Revenues:
$458.7 million, 1.9% decrease
- Fourth Quarter 2022 Operating Income:
$48.2 million, 102.6%
increase
- Fourth Quarter 2022 Earnings Per Share:
$1.27 per share, 111.7%
increase
- Declares Quarterly Dividend: $0.105 per share
WARREN,
Mich., Feb. 9, 2023 /PRNewswire/ -- Universal
Logistics Holdings, Inc. (NASDAQ: ULH) today reported consolidated
fourth quarter 2022 net income of $33.4
million, or $1.27 per basic
and diluted share, on total operating revenues of $458.7 million. This compares to net income of
$16.2 million, or $0.60 per basic and diluted share, during fourth
quarter 2021 on total operating revenues of $467.4 million. Universal's fourth quarter 2022
operating income and earnings per share represent the best fourth
quarter results in company history. For the full year 2022,
Universal reported $6.37 per basic
and diluted share, on total operating revenues of $2.02 billion, both all-time records in company
history. This compares to $2.74 per
basic and diluted share, on total operating revenues of
$1.75 billion for the full year
2021.
In the fourth quarter 2022, Universal's operating income
increased $24.4 million to
$48.2 million, compared to
$23.8 million in the fourth quarter
one year earlier. Included in fourth quarter 2021 operating
results were $11.0 million of pre-tax
charges related to previously disclosed items. As a percentage of
operating revenue, operating margin for the fourth quarter 2022 was
10.5%, compared to 5.1% during the same period last year. EBITDA, a
non-GAAP measure, increased $28.3
million during the fourth quarter 2022 to $68.0 million, compared to $39.7 million one year earlier. As a percentage
of operating revenue, EBITDA margin for the fourth quarter 2022 was
14.8%, compared to 8.5% during the same period last year. The
previously disclosed pre-tax charges recorded in the fourth quarter
2021 adversely impacted Universal's operating margin and EBITDA
margin in that period by 230 basis points.
"2022 was a year of record setting financial performance for the
company," stated Universal's CEO Tim
Phillips. "And we closed out the year with yet another,
reporting our best ever fourth quarter earnings in company history.
In fact, for the full year 2022, Universal more than doubled its
net income and reported top-line revenues in excess of $2.0 billion, a milestone we have worked so
diligently to achieve."
"As we transition into a new year," Phillips continued, "we are
navigating a much different transportation environment. Excess
retail inventories, a slow-down in industrial production and
loosening capacity have all put downward pressures on our trucking,
company-managed brokerage and intermodal segments. While we expect
near-term headwinds in transportation, stability in our contract
logistics segment, supported by strong North American auto
production, will provide a solid foundation for the year to come.
Universal remains a results-oriented organization, and I believe
the diversification of our service offerings and the talented teams
we have assembled keep us well positioned for continued
success."
Segment Information:
Contract Logistics
- Fourth Quarter 2022 Operating Revenues:
$205.5 million, 27.9%
increase
- Fourth Quarter 2022 Operating
Income: $30.1 million, 14.7%
operating margin
In the contract logistics segment, which includes our
value-added and dedicated services, fourth quarter 2022 operating
revenues increased 27.9% to $205.5
million, compared to $160.7
million for the same period last year. We grew our
fourth quarter 2022 dedicated transportation load volumes by 5.3%
compared to the same period last year, and we managed 63
value-added programs at the end of both fourth quarters 2022 and
2021. Included in contract logistics segment revenues were
$10.6 million in separately
identified fuel surcharges from dedicated transportation services,
compared to $5.9 million during the
same period last year. Fourth quarter 2022 income from operations
increased $24.0 million to
$30.1 million, compared to
$6.1 million during the same period
last year. Included in fourth quarter 2021 results were
$5.0 million of losses incurred in
connection with a previously announced program launch. As a
percentage of revenue, operating margin in the contract logistics
segment for the fourth quarter 2022 was 14.7%, compared to 3.8%
during the same period last year. Previously disclosed pre-tax
launch losses recorded in the fourth quarter 2021 adversely
impacted this segment's operating margin by 310 basis
points.
Intermodal
- Fourth Quarter 2022 Operating Revenues:
$123.1 million, 13.2%
decrease
- Fourth Quarter 2022 Operating
Income: $11.1 million, 9.0%
operating margin
Operating revenues in the intermodal segment decreased 13.2% to
$123.1 million in the fourth quarter
2022, compared to $141.7 million for
the same period last year. Included in intermodal segment revenues
for the recently completed quarter were $22.4 million in separately identified fuel
surcharges, compared to $16.1 million
during the same period last year. Intermodal segment revenues also
include other accessorial charges such as detention, demurrage and
storage which totaled $22.5 million
during the fourth quarter 2022, compared to $35.7 million one year earlier. The average
operating revenue per load, excluding fuel surcharges, increased
15.1%; however, load volumes decreased 25.7% year-over-year. Fourth
quarter 2022 income from operations decreased $2.7 million to $11.1
million, compared to $13.8
million during the same period last year. As a percentage of
revenue, operating margin in the intermodal segment for the fourth
quarter 2022 was 9.0%, compared to 9.7% one year earlier.
Trucking
- Fourth Quarter 2022 Operating Revenues:
$89.0 million, 12.3%
decrease
- Fourth Quarter 2022 Operating
Income: $5.7 million, 6.5%
operating margin
In the trucking segment, fourth quarter 2022 operating revenues
decreased 12.3% to $89.0 million,
compared to $101.5 million for the
same period last year. Fourth quarter 2022 trucking segment
revenues included $36.5 million of
brokerage services, compared to $38.1
million during the same period last year. Also included in
our trucking segment revenues were $8.1
million in separately identified fuel surcharges during the
fourth quarter 2022, compared to $6.8
million in fuel surcharges during the same period last year.
On a year-over-year basis, the average operating revenue per load,
excluding fuel surcharges, increased 24.1%; however, load volumes
declined 32.9% as we rationalized certain underperforming
operations in this segment. Income from operations in the fourth
quarter 2022 increased $4.6 million
to $5.7 million compared to
$1.1 million during the same period
last year. Fourth quarter 2021 trucking segment results included an
additional $6.0 million in previously
disclosed pre-tax charges. As a percentage of revenue, operating
margin in the trucking segment for the fourth quarter 2022 was 6.5%
compared to 1.1% during the same period last year. The additional
previously disclosed pre-tax charges recorded in the fourth quarter
2021 adversely impacted the trucking segment's operating margin by
590 basis points.
Company-managed Brokerage
- Fourth Quarter 2022 Operating Revenues:
$39.6 million, 36.2%
decrease
- Fourth Quarter 2022 Operating
Income: $0.9 million, 2.3%
operating margin
Fourth quarter 2022 operating revenues in the company-managed
brokerage segment decreased 36.2% to $39.6
million compared to $62.0
million for the same period last year. Company-managed
brokerage segment average operating revenue per load, excluding
fuel surcharges, decreased 14.8% and load volumes declined 19.9% on
a year-over-year basis. Fourth quarter 2022 income from operations
in the company-managed brokerage segment was $0.9 million which compares to $2.5 million one year earlier. As a
percentage of revenue, operating margin for the fourth quarter 2022
was 2.3% compared to 4.0% during the same period last year.
Cash Dividend
Universal Logistics Holdings, Inc. also announced today that its
Board of Directors has declared a cash dividend of $0.105 per share of common stock. The
dividend is payable to shareholders of record at the close of
business on March 6, 2023 and is
expected to be paid on April 3,
2023.
Other Matters
As of December 31, 2022, Universal
held cash and cash equivalents totaling $47.2 million, and $10.0
million in marketable securities. Outstanding debt at the
end of the fourth quarter 2022 was $382.9
million and capital expenditures totaled $31.3 million.
Universal calculates and reports selected financial metrics not
only for purposes of our lending arrangements but also in an effort
to isolate and exclude the impact of non-operating expenses related
to our corporate development activities. These statistics are
described in more detail below in the section captioned "Non-GAAP
Financial Measures."
Conference call:
We invite investors and analysts to our quarterly earnings
conference call.
Quarterly Earnings Conference Call Dial-in Details:
Time:
|
10:00 a.m. Eastern
Time
|
Date:
|
Friday, February 10,
2023
|
Call Toll
Free:
|
(877)
270-2148
|
International
Dial-in:
|
+1 (412)
902-6510
|
Conference
ID:
|
10175013
|
A replay of the conference call will be available through
February 17, 2023, by calling (877)
344-7529 (toll free) or +1 (412) 317-0088 (toll) and using encore
replay code 3803897. The call will also be available on
investors.universallogistics.com.
About Universal:
Universal Logistics Holdings, Inc. ("Universal") is a holding
company that owns subsidiaries engaged in providing a variety of
customized transportation and logistics solutions throughout
the United States, and in
Mexico, Canada and Colombia. Our operating
subsidiaries provide customers with supply chain solutions that can
be scaled to meet their changing demands and volumes. Universal's
consolidated subsidiaries offer customers a broad array of services
across the entire supply chain, including truckload, brokerage,
intermodal, dedicated, and value-added services. In this press
release, the terms "us," "we," "our," or the "Company" refer to
Universal and its consolidated subsidiaries.
Forward Looking Statements
Some of the statements contained in this press release might
be considered forward-looking statements. These statements identify
prospective information. Forward-looking statements can be
identified by words such as: "expect," "anticipate," "intend,"
"plan," "goal," "prospect," "seek," "believe," "targets,"
"project," "estimate," "future," "likely," "may," "should" and
similar references to future periods. Forward-looking statements
are based on information available at the time and/or management's
good faith belief with respect to future events and are subject to
risks and uncertainties that could cause actual performance or
results to differ materially from those expressed in the
statements. These forward-looking statements are subject to a
number of factors that may cause actual results to differ
materially from the expectations described. Additional information
about the factors that may adversely affect these forward-looking
statements is contained in Universal's reports and filings with the
Securities and Exchange Commission. Universal assumes no obligation
to update forward-looking statements to reflect actual results,
changes in assumptions or changes in other factors affecting
forward-looking information except to the extent required by
applicable securities laws.
UNIVERSAL LOGISTICS
HOLDINGS, INC.
Unaudited Condensed
Consolidated Statements of Income
(In thousands, except
per share data)
|
|
|
|
Thirteen Weeks
Ended
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
Operating
revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Truckload
services
|
|
$
|
54,044
|
|
|
$
|
64,838
|
|
|
$
|
230,696
|
|
|
$
|
248,878
|
|
Brokerage
services
|
|
|
76,092
|
|
|
|
100,143
|
|
|
|
368,880
|
|
|
|
401,823
|
|
Intermodal
services
|
|
|
123,077
|
|
|
|
141,723
|
|
|
|
591,946
|
|
|
|
473,059
|
|
Dedicated
services
|
|
|
83,039
|
|
|
|
54,003
|
|
|
|
324,589
|
|
|
|
204,102
|
|
Value-added
services
|
|
|
122,470
|
|
|
|
106,665
|
|
|
|
499,345
|
|
|
|
423,118
|
|
Total operating
revenues
|
|
|
458,722
|
|
|
|
467,372
|
|
|
|
2,015,456
|
|
|
|
1,750,980
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased
transportation and equipment rent
|
|
|
179,197
|
|
|
|
224,516
|
|
|
|
847,414
|
|
|
|
824,789
|
|
Direct personnel and
related benefits
|
|
|
130,936
|
|
|
|
119,720
|
|
|
|
522,659
|
|
|
|
456,643
|
|
Operating supplies and
expenses
|
|
|
44,554
|
|
|
|
35,779
|
|
|
|
177,440
|
|
|
|
149,394
|
|
Commission
expense
|
|
|
8,876
|
|
|
|
8,914
|
|
|
|
40,288
|
|
|
|
33,894
|
|
Occupancy
expense
|
|
|
10,941
|
|
|
|
10,380
|
|
|
|
41,286
|
|
|
|
37,286
|
|
General and
administrative
|
|
|
11,903
|
|
|
|
9,783
|
|
|
|
46,528
|
|
|
|
39,648
|
|
Insurance and
claims
|
|
|
5,825
|
|
|
|
18,847
|
|
|
|
22,749
|
|
|
|
38,829
|
|
Depreciation and
amortization
|
|
|
18,324
|
|
|
|
15,657
|
|
|
|
76,657
|
|
|
|
67,537
|
|
Total operating
expenses
|
|
|
410,556
|
|
|
|
443,596
|
|
|
|
1,775,021
|
|
|
|
1,648,020
|
|
Income from
operations
|
|
|
48,166
|
|
|
|
23,776
|
|
|
|
240,435
|
|
|
|
102,960
|
|
Interest expense,
net
|
|
|
(5,313)
|
|
|
|
(2,510)
|
|
|
|
(16,156)
|
|
|
|
(11,599)
|
|
Other non-operating
income
|
|
|
1,467
|
|
|
|
247
|
|
|
|
1,143
|
|
|
|
7,220
|
|
Income before income
taxes
|
|
|
44,320
|
|
|
|
21,513
|
|
|
|
225,422
|
|
|
|
98,581
|
|
Provision for income
taxes
|
|
|
10,874
|
|
|
|
5,314
|
|
|
|
56,790
|
|
|
|
24,848
|
|
Net income
|
|
$
|
33,446
|
|
|
$
|
16,199
|
|
|
$
|
168,632
|
|
|
$
|
73,733
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.27
|
|
|
$
|
0.60
|
|
|
$
|
6.37
|
|
|
$
|
2.74
|
|
Diluted
|
|
$
|
1.27
|
|
|
$
|
0.60
|
|
|
$
|
6.37
|
|
|
$
|
2.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number
of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
26,278
|
|
|
|
26,919
|
|
|
|
26,469
|
|
|
|
26,919
|
|
Diluted
|
|
|
26,311
|
|
|
|
26,923
|
|
|
|
26,489
|
|
|
|
26,929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per
common share:
|
|
$
|
0.105
|
|
|
$
|
0.105
|
|
|
$
|
0.420
|
|
|
$
|
0.420
|
|
UNIVERSAL LOGISTICS
HOLDINGS, INC.
Unaudited Condensed
Consolidated Balance Sheets
(In
thousands)
|
|
|
|
December 31,
2022
|
|
|
December 31,
2021
|
|
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
47,181
|
|
|
$
|
13,932
|
|
Marketable
securities
|
|
|
10,000
|
|
|
|
8,031
|
|
Accounts receivable -
net
|
|
|
350,720
|
|
|
|
341,398
|
|
Other current
assets
|
|
|
51,751
|
|
|
|
57,334
|
|
Total current
assets
|
|
|
459,652
|
|
|
|
420,695
|
|
Property and equipment
- net
|
|
|
391,154
|
|
|
|
345,583
|
|
Other long-term assets
- net
|
|
|
352,872
|
|
|
|
371,213
|
|
Total
assets
|
|
$
|
1,203,678
|
|
|
$
|
1,137,491
|
|
|
|
|
|
|
|
|
Liabilities and
shareholders' equity
|
|
|
|
|
|
|
Current liabilities,
excluding current maturities of debt
|
|
$
|
221,598
|
|
|
$
|
251,550
|
|
Debt - net
|
|
|
378,500
|
|
|
|
427,348
|
|
Other long-term
liabilities
|
|
|
156,650
|
|
|
|
156,383
|
|
Total
liabilities
|
|
|
756,748
|
|
|
|
835,281
|
|
Total shareholders'
equity
|
|
|
446,930
|
|
|
|
302,210
|
|
Total liabilities and
shareholders' equity
|
|
$
|
1,203,678
|
|
|
$
|
1,137,491
|
|
UNIVERSAL LOGISTICS
HOLDINGS, INC.
Unaudited Summary of
Operating Data
|
|
|
|
Thirteen Weeks
Ended
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
Contract Logistics
Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of dedicated
transportation loads (a)
|
|
|
152,821
|
|
|
|
145,127
|
|
|
|
619,673
|
|
|
|
594,748
|
|
Average number of
value-added direct employees
|
|
|
5,121
|
|
|
|
5,005
|
|
|
|
5,079
|
|
|
|
4,534
|
|
Average number of
value-added full-time equivalents
|
|
|
1,153
|
|
|
|
1,322
|
|
|
|
1,323
|
|
|
|
1,448
|
|
Number of active
value-added programs
|
|
|
63
|
|
|
|
63
|
|
|
|
63
|
|
|
|
63
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intermodal
Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
loads
|
|
|
116,475
|
|
|
|
156,736
|
|
|
|
552,398
|
|
|
|
665,088
|
|
Average operating
revenue per load, excluding fuel surcharges
|
|
$
|
685
|
|
|
$
|
595
|
|
|
$
|
702
|
|
|
$
|
522
|
|
Average number of
tractors
|
|
|
2,333
|
|
|
|
2,056
|
|
|
|
2,223
|
|
|
|
2,042
|
|
Number of
depots
|
|
|
9
|
|
|
|
12
|
|
|
|
9
|
|
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trucking
Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
loads
|
|
|
45,233
|
|
|
|
67,440
|
|
|
|
199,712
|
|
|
|
288,378
|
|
Average operating
revenue per load, excluding fuel surcharges
|
|
$
|
1,831
|
|
|
$
|
1,475
|
|
|
$
|
1,807
|
|
|
$
|
1,356
|
|
Average number of
tractors
|
|
|
898
|
|
|
|
1,234
|
|
|
|
899
|
|
|
|
1,299
|
|
Average length of
haul
|
|
|
422
|
|
|
|
374
|
|
|
|
403
|
|
|
|
372
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company-Managed
Brokerage Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of loads
(b)
|
|
|
21,979
|
|
|
|
27,434
|
|
|
|
90,432
|
|
|
|
121,944
|
|
Average operating
revenue per load (b)
|
|
$
|
1,684
|
|
|
$
|
1,976
|
|
|
$
|
1,893
|
|
|
$
|
1,845
|
|
Average length of haul
(b)
|
|
|
613
|
|
|
|
533
|
|
|
|
598
|
|
|
|
553
|
|
|
(a)
Includes shuttle moves.
|
(b) Excludes
operating data from freight forwarding division in order to improve
the relevance of the statistical data
related to our brokerage services and
improve the comparability to our peer companies.
|
UNIVERSAL LOGISTICS
HOLDINGS, INC.
Unaudited Summary of
Operating Data - Continued
(Dollars in
thousands)
|
|
|
|
Thirteen Weeks
Ended
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
Operating Revenues
by Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract
logistics
|
|
$
|
205,509
|
|
|
$
|
160,668
|
|
|
$
|
823,934
|
|
|
$
|
627,220
|
|
Intermodal
|
|
|
123,077
|
|
|
|
141,723
|
|
|
|
591,946
|
|
|
|
473,059
|
|
Trucking
|
|
|
88,991
|
|
|
|
101,474
|
|
|
|
392,639
|
|
|
|
403,312
|
|
Company-managed
brokerage
|
|
|
39,596
|
|
|
|
62,035
|
|
|
|
200,536
|
|
|
|
242,794
|
|
Other
|
|
|
1,549
|
|
|
|
1,472
|
|
|
|
6,401
|
|
|
|
4,595
|
|
Total
|
|
$
|
458,722
|
|
|
$
|
467,372
|
|
|
$
|
2,015,456
|
|
|
$
|
1,750,980
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
Operations by Segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract
logistics
|
|
$
|
30,137
|
|
|
$
|
6,067
|
|
|
$
|
118,437
|
|
|
$
|
44,809
|
|
Intermodal
|
|
|
11,114
|
|
|
|
13,799
|
|
|
|
83,640
|
|
|
|
30,379
|
|
Trucking
|
|
|
5,743
|
|
|
|
1,105
|
|
|
|
27,564
|
|
|
|
19,607
|
|
Company-managed
brokerage
|
|
|
897
|
|
|
|
2,466
|
|
|
|
9,993
|
|
|
|
7,122
|
|
Other
|
|
|
275
|
|
|
|
339
|
|
|
|
801
|
|
|
|
1,043
|
|
Total
|
|
$
|
48,166
|
|
|
$
|
23,776
|
|
|
$
|
240,435
|
|
|
$
|
102,960
|
|
Non-GAAP Financial Measures
In addition to providing consolidated financial statements based
on generally accepted accounting principles in the United States of America (GAAP), we are
providing additional financial measures that are not required by or
prepared in accordance with GAAP (non-GAAP). We present EBITDA and
EBITDA margin, each a non-GAAP measure, as supplemental measures of
our performance. We define EBITDA as net income plus (i) interest
expense, net, (ii) income taxes, (iii) depreciation, and (iv)
amortization. We define EBITDA margin as EBITDA as a percentage of
total operating revenues. You are encouraged to evaluate these
adjustments and the reasons we consider them appropriate for
supplemental analysis.
In accordance with the requirements of Regulation G issued by
the Securities and Exchange Commission, we are presenting the most
directly comparable GAAP financial measure and reconciling the
non-GAAP financial measure to the comparable GAAP measure. Set
forth below is a reconciliation of net income, the most comparable
GAAP measure, to EBITDA for each of the periods indicated:
|
|
Thirteen Weeks
Ended
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
|
|
( in
thousands)
|
|
|
( in
thousands)
|
|
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
33,446
|
|
|
$
|
16,199
|
|
|
$
|
168,632
|
|
|
$
|
73,733
|
|
Income tax
expense
|
|
|
10,874
|
|
|
|
5,314
|
|
|
|
56,790
|
|
|
|
24,848
|
|
Interest expense,
net
|
|
|
5,313
|
|
|
|
2,510
|
|
|
|
16,156
|
|
|
|
11,599
|
|
Depreciation
|
|
|
14,617
|
|
|
|
12,248
|
|
|
|
62,275
|
|
|
|
53,650
|
|
Amortization
|
|
|
3,707
|
|
|
|
3,409
|
|
|
|
14,382
|
|
|
|
13,887
|
|
EBITDA
|
|
$
|
67,957
|
|
|
$
|
39,680
|
|
|
$
|
318,235
|
|
|
$
|
177,717
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA margin
(a)
|
|
|
14.8
|
%
|
|
|
8.5
|
%
|
|
|
15.8
|
%
|
|
|
10.1
|
%
|
|
(a) EBITDA
margin is computed by dividing EBITDA by total operating revenues
for each of the periods indicated.
|
We present EBITDA and EBITDA margin because we believe they
assist investors and analysts in comparing our performance across
reporting periods on a consistent basis by excluding items that we
do not believe are indicative of our core operating
performance.
EBITDA has limitations as an analytical tool. Some of these
limitations are:
- EBITDA does not reflect our cash expenditures, or future
requirements, for capital expenditures or contractual
commitments;
- EBITDA does not reflect changes in, or cash requirements for,
our working capital needs;
- EBITDA does not reflect the significant interest expense, or
the cash requirements necessary to service interest or principal
payments, on our debts;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future, and EBITDA does not reflect any cash
requirements for such replacements; and
- Other companies in our industry may calculate EBITDA
differently than we do, limiting its usefulness as a comparative
measure.
Because of these limitations, EBITDA and EBITDA margin should
not be considered in isolation or as a substitute for performance
measures calculated in accordance with GAAP. We compensate for
these limitations by relying primarily on our GAAP results and only
supplementally on EBITDA and EBITDA margin.
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SOURCE Universal Logistics Holdings, Inc.