Loading...
•
Jun 30, 2021
Hub Group Q2 2021 Earnings Report
Hub Group reported strong second-quarter results driven by unprecedented freight market conditions and a focus on customer experience, resulting in significant revenue growth and improved earnings per share.
Key Takeaways
Hub Group's second-quarter 2021 results showed significant growth, with a 26% increase in revenue to $981 million and net income doubling to $26.6 million, or $0.78 per diluted share, compared to the previous year. This performance was driven by favorable market conditions, a focus on yield improvement and operating efficiency.
Revenue increased by 26% to $981 million compared to the second quarter of 2020.
Net income doubled to $26.6 million, with diluted earnings per share of $0.78.
Intermodal revenue increased by 23% to $550 million due to volume and revenue per load growth.
Truck brokerage revenue grew by 62% to $140 million, driven by higher revenue per load and volume growth.
Hub Group
Hub Group
Hub Group Revenue by Segment
Revenue by Segment
Logistics Revenue
CapyFin.com Forward Guidance
Hub Group anticipates continued growth in 2021, projecting diluted earnings per share to range from $3.50 to $3.70 and revenue to grow in the high-teens percentage range. The company also announced a revenue target of $5.5 to $6.5 billion in 2025.
Positive Outlook
- Diluted earnings per share are expected to range from $3.50 to $3.70 for 2021.
- Revenue is estimated to grow in the high-teens percentage range for 2021.
- Gross margin as a percentage of revenue is projected to range from 12.5% to 13.0%.
- The company plans to add approximately 3,000 containers, resulting in net growth of approximately 2,750 after retirements.
- Approximately 700 tractors will be added to replace older units and support growth in drayage and dedicated fleets.
Challenges Ahead
- Costs and expenses are estimated to range from $355 to $365 million for the year.
- The effective tax rate for the second half of 2021 is projected to range from 24% to 25%.
- Capital expenditures for fiscal year 2021 are expected to range from $165 to $175 million.
- Dedicated gross margin decreased primarily due to higher maintenance, repair and purchased transportation expenses.
- Contractual freight represented 51% of total brokerage volume in the second quarter of 2021 as compared to 64% in 2020.