Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2017shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | RYDER SYSTEM INC |
Entity Central Index Key | 85,961 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2017 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding (in shares) | 53,560,199 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Earnings (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Lease and rental revenues | $ 767,590 | $ 767,754 |
Services revenue | 851,867 | 759,127 |
Fuel services revenue | 128,706 | 102,791 |
Total revenues | 1,748,163 | 1,629,672 |
Cost of lease and rental | 578,762 | 552,490 |
Cost of services | 714,080 | 631,714 |
Cost of fuel services | 125,850 | 98,901 |
Other operating expenses | 31,271 | 30,151 |
Selling, general and administrative expenses | 201,761 | 204,403 |
Non-service retirement benefit costs | 7,330 | 6,810 |
Used vehicle sales, net | (780) | (19,129) |
Interest expense | 34,886 | 37,889 |
Miscellaneous income, net | (4,953) | (2,265) |
Total expenses | 1,688,207 | 1,540,964 |
Earnings from continuing operations before income taxes | 59,956 | 88,708 |
Provision for income taxes | 21,677 | 32,523 |
Earnings from continuing operations | 38,279 | 56,185 |
Loss from discontinued operations, net of tax | (130) | (391) |
Net earnings | $ 38,149 | $ 55,794 |
Earnings (loss) per common share — Basic | ||
Continuing operations (in dollars per share) | $ 0.72 | $ 1.06 |
Discontinued operations (in dollars per share) | 0 | (0.01) |
Net earnings (in dollars per share) | 0.72 | 1.05 |
Earnings (loss) per common share — Diluted | ||
Continuing operations (in dollars per share) | 0.71 | 1.05 |
Discontinued operations (in dollars per share) | 0 | (0.01) |
Net earnings (in dollars per share) | 0.71 | 1.04 |
Cash dividends declared per common share (in dollars per share) | $ 0.44 | $ 0.41 |
Consolidated Condensed Stateme3
Consolidated Condensed Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 38,149 | $ 55,794 |
Other comprehensive income: | ||
Changes in currency translation adjustment and other | 15,742 | 13,684 |
Amortization of pension and postretirement items | 8,109 | 7,423 |
Income tax expense related to amortization of pension and postretirement items | (3,045) | (2,708) |
Amortization of pension and postretirement items, net of tax | 5,064 | 4,715 |
Other comprehensive income, net of taxes | 20,806 | 18,399 |
Comprehensive income | $ 58,955 | $ 74,193 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 37,951 | $ 58,801 |
Receivables, net of allowance of $12,210 and $14,915, respectively | 862,862 | 831,947 |
Inventories | 67,732 | 69,529 |
Prepaid expenses and other current assets | 144,795 | 141,280 |
Total current assets | 1,113,340 | 1,101,557 |
Revenue earning equipment, net | 8,171,176 | 8,147,722 |
Operating property and equipment, net of accumulated depreciation of $1,144,914 and $1,128,040, respectively | 754,307 | 745,870 |
Goodwill | 387,096 | 386,772 |
Intangible assets, net of accumulated amortization of $53,022 and $51,578, respectively | 46,905 | 48,249 |
Direct financing leases and other assets | 500,983 | 472,284 |
Total assets | 10,973,807 | 10,902,454 |
Current liabilities: | ||
Short-term debt and current portion of long-term debt | 973,115 | 791,410 |
Accounts payable | 536,225 | 445,470 |
Accrued expenses and other current liabilities | 468,459 | 507,189 |
Total current liabilities | 1,977,799 | 1,744,069 |
Long-term debt | 4,353,110 | 4,599,864 |
Other non-current liabilities | 852,835 | 817,565 |
Deferred income taxes | 1,710,267 | 1,688,681 |
Total liabilities | 8,894,011 | 8,850,179 |
Shareholders’ equity: | ||
Preferred stock, no par value per share — authorized, 3,800,917; none outstanding, March 31, 2017 or December 31, 2016 | 0 | 0 |
Common stock, $0.50 par value per share — authorized, 400,000,000; outstanding, March 31, 2017 — 53,560,199; December 31, 2016 — 53,463,118 | 26,781 | 26,732 |
Additional paid-in capital | 1,037,127 | 1,032,549 |
Retained earnings | 1,829,114 | 1,827,026 |
Accumulated other comprehensive loss | (813,226) | (834,032) |
Total shareholders’ equity | 2,079,796 | 2,052,275 |
Total liabilities and shareholders’ equity | $ 10,973,807 | $ 10,902,454 |
Consolidated Condensed Balance5
Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Assets: | ||
Allowance for doubtful accounts, current | $ 12,210 | $ 14,915 |
Operating property and equipment, accumulated depreciation | 1,144,914 | 1,128,040 |
Finite-Lived intangible assets, accumulated amortization | $ 53,022 | $ 51,578 |
Shareholders’ equity: | ||
Common stock, par value (in dollars per share) | $ 0.50 | $ 0.50 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares outstanding (in shares) | 53,560,199 | 53,463,118 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized (in shares) | 3,800,917 | 3,800,917 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Consolidated Condensed Stateme6
Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities from continuing operations: | ||
Net earnings | $ 38,149 | $ 55,794 |
Less: Loss from discontinued operations, net of tax | (130) | (391) |
Earnings from continuing operations | 38,279 | 56,185 |
Depreciation expense | 311,207 | 287,170 |
Used vehicle sales, net | (780) | (19,129) |
Share-based compensation expense | 4,955 | 4,888 |
Amortization expense and other non-cash charges, net | 8,841 | 6,248 |
Non-service retirement benefit costs | 7,330 | 6,810 |
Deferred income tax expense | 18,887 | 29,319 |
Changes in operating assets and liabilities: | ||
Receivables | (27,348) | 3,709 |
Inventories | 1,876 | (1,558) |
Prepaid expenses and other assets | (7,577) | (21,234) |
Accounts payable | 13,966 | 49,206 |
Accrued expenses and other non-current liabilities | (38,287) | (33,612) |
Net cash provided by operating activities from continuing operations | 331,349 | 368,002 |
Cash flows from financing activities from continuing operations: | ||
Net change in commercial paper borrowings and revolving credit facilities | 9,513 | 98,580 |
Debt proceeds | 477,550 | 298,254 |
Debt repaid | (555,671) | (312,400) |
Dividends on common stock | (23,907) | (22,482) |
Common stock issued | 3,992 | 1,492 |
Common stock repurchased | (16,846) | 0 |
Debt issuance costs and other items | (846) | (2,932) |
Net cash (used in) provided by financing activities | (106,215) | 60,512 |
Cash flows from investing activities from continuing operations: | ||
Purchases of property and revenue earning equipment | (361,339) | (575,031) |
Sales of revenue earning equipment | 95,617 | 119,188 |
Sales of operating property and equipment | 892 | 1,410 |
Collections on direct finance leases and other items | 16,265 | 25,610 |
Changes in restricted cash | 1,435 | (221) |
Net cash used in investing activities | (247,130) | (429,044) |
Effect of exchange rate changes on cash | 1,501 | (3,508) |
Decrease in cash and cash equivalents from continuing operations | (20,495) | (4,038) |
Decrease in cash and cash equivalents from discontinued operations | (355) | (101) |
Decrease in cash and cash equivalents | (20,850) | (4,139) |
Cash and cash equivalents at January 1 | 58,801 | 60,945 |
Cash and cash equivalents at March 31 | $ 37,951 | $ 56,806 |
GENERAL
GENERAL | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
GENERAL | GENERAL Interim Financial Statements The accompanying unaudited Consolidated Condensed Financial Statements include the accounts of Ryder System, Inc. (Ryder) and all entities in which Ryder has a controlling voting interest (subsidiaries) and variable interest entities (VIEs) required to be consolidated in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The accompanying unaudited Consolidated Condensed Financial Statements have been prepared in accordance with the accounting policies described in our 2016 Annual Report on Form 10-K and should be read in conjunction with the Consolidated Financial Statements and notes thereto. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement have been included and the disclosures herein are adequate. The operating results for interim periods are unaudited and are not necessarily indicative of the results that can be expected for a full year. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS Employee Benefits Plans In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost , which requires an employer to report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable. The standard is effective January 1, 2018, with early adoption as of January 1, 2017 permitted. We adopted the standard during the first quarter of 2017, and recorded the other components of net benefit cost within "Non-service retirement benefit costs" in the Consolidated Condensed Statements of Earnings for both the current and prior year periods. Intangibles - Goodwill and Other In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment , which requires an entity to perform a one-step quantitative impairment test, whereby a goodwill impairment loss will be measured as the excess of a reporting unit’s carrying amount over its fair value (not to exceed the total goodwill allocated to that reporting unit). It eliminates Step 2 of the current two-step goodwill impairment test, under which a goodwill impairment loss is measured by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The standard is effective January 1, 2020, with early adoption as of January 1, 2017 permitted. We adopted the standard during the first quarter of 2017 and it did not have a material impact on our consolidated financial position, results of operations and cash flows. Statement of Cash Flows In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows, which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. In November 2016, the FASB issued additional guidance related to the statement of cash flows, which requires companies to explain the change during the period in the total of cash, cash equivalents, and restricted cash or restricted cash equivalents. The standard is effective January 1, 2018, with early adoption permitted. We will adopt the standard as of January 1, 2018, on a retrospective basis. We do not expect this standard to have a material impact on the presentation of our consolidated cash flows. Leases In February 2016, the FASB issued ASU No. 2016-02, Leases, which sets out the principles for the recognition, measurement, presentation and disclosure of leases. The standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. We will adopt the standard effective January 1, 2019, using the modified retrospective transition method. We do not anticipate a material impact upon adoption of the standard on our consolidated financial position, results of operations and cash flows. Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers , which together with related, subsequently issued guidance, requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The adoption of ASU 2014-09 will primarily impact our ChoiceLease product line, which includes a vehicle lease as well as maintenance and other services related to the vehicle. We will generally continue to recognize revenue for the vehicle lease portion of the product line on a straight-line basis. Revenue from the non-lease portion of the product line, primarily maintenance services, will be recognized at the time the maintenance services are performed, which will generally require the deferral of some portion of the customer's lease payments when received, as maintenance services are not performed evenly over the life of a ChoiceLease contract. Under current GAAP, substantially all revenues from our ChoiceLease arrangements are recognized on a straight line basis over the term of the lease. We will adopt the standard on January 1, 2018, using the full retrospective transition method, which will result in a cumulative-effect adjustment to recognize deferred revenue on the opening balance sheet for 2016 and the restatement of the financial statements for all prior periods presented (2016 and 2017). We continue to evaluate the impact of adoption of this standard on our consolidated financial position, results of operations and cash flows. |
REVENUE EARNING EQUIPMENT
REVENUE EARNING EQUIPMENT | 3 Months Ended |
Mar. 31, 2017 | |
Revenue Earning Equipment [Abstract] | |
REVENUE EARNING EQUIPMENT | REVENUE EARNING EQUIPMENT March 31, 2017 December 31, 2016 Cost Accumulated Depreciation Net Book Value (1) Cost Accumulated Depreciation Net Book Value (1) (In thousands) Held for use: ChoiceLease $ 9,664,962 (3,159,228 ) 6,505,734 $ 9,486,977 (3,031,937 ) 6,455,040 Commercial rental 2,492,992 (942,309 ) 1,550,683 2,499,010 (935,346 ) 1,563,664 Held for sale 439,022 (324,263 ) 114,759 494,355 (365,337 ) 129,018 Total $ 12,596,976 (4,425,800 ) 8,171,176 $ 12,480,342 (4,332,620 ) 8,147,722 ———————————— (1) Revenue earning equipment, net book value includes vehicles acquired under capital leases of $37 million , less accumulated depreciation of $17 million , at March 31, 2017 , and $43 million , less accumulated depreciation of $22 million , at December 31, 2016 . We lease revenue earning equipment to customers for periods typically ranging from three to seven years for trucks and tractors and up to ten years for trailers. The majority of our leases are classified as operating leases. However, some of our revenue earning equipment leases are classified as direct financing leases and, to a lesser extent, sales-type leases. As of March 31, 2017 and December 31, 2016 , the net investment in direct financing and sales-type leases was $404 million and $409 million , respectively. Our direct financing lease customers operate in a wide variety of industries, and we have no significant customer concentrations in any one industry. We assess credit risk for all of our customers including those who lease equipment under direct financing leases prior to signing a ChoiceLease contract. For those customers who are designated as high risk, we typically require deposits to be paid in advance in order to mitigate our credit risk. Additionally, our receivables are collateralized by the vehicles, which further mitigates our credit risk. As of March 31, 2017 and December 31, 2016 , the amount of direct financing lease receivables past due was not significant, and there were no impaired receivables. Accordingly, we do not believe there is a material risk of default with respect to the direct financing lease receivables. Revenue earning equipment held for sale is stated at the lower of carrying amount or fair value less costs to sell. Losses on vehicles held for sale for which carrying values exceeded fair value are recognized at the time they arrive at our used truck sales centers and are presented within “Used vehicle sales, net ” in the Consolidated Condensed Statements of Earnings. For revenue earning equipment held for sale, we stratify our fleet by vehicle type (trucks, tractors and trailers), weight class, age and other relevant characteristics and create classes of similar assets for analysis purposes. For a certain population of our revenue earning equipment held for sale, fair value was determined based upon recent market prices obtained from our own sales experience for sales of each class of similar assets and vehicle condition. These vehicles held for sale were classified within Level 3 of the fair value hierarchy. The following table presents our assets held for sale that are measured at fair value on a nonrecurring basis and considered a Level 3 fair value measurement: Total Losses (2) March 31, Three months ended March 31, 2017 2016 2017 2016 (In thousands) Assets held for sale: Revenue earning equipment (1) : Trucks $ 12,228 11,538 $ 5,800 1,744 Tractors 38,383 39,739 5,183 4,882 Trailers 2,303 3,153 568 662 Total assets at fair value $ 52,914 54,430 $ 11,551 7,288 ———————————— (1) Assets held for sale in the above table only include the portion of revenue earning equipment held for sale where net book values exceeded fair values and fair value adjustments were recorded. The net book value of assets held for sale not exceeding fair value was $62 million and $120 million as of March 31, 2017 and 2016 , respectively. (2) Total losses represent fair value adjustments for all vehicles reclassified to held for sale throughout the period for which fair value was less than carrying value. For the three months ended March 31, 2017 and 2016 , the components of used vehicle sales, net were as follows: Three months ended March 31, 2017 2016 (In thousands) Gains on vehicle sales, net $ (12,331 ) (26,417 ) Losses from fair value adjustments 11,551 7,288 Used vehicle sales, net $ (780 ) (19,129 ) |
ACCRUED EXPENSES AND OTHER LIAB
ACCRUED EXPENSES AND OTHER LIABILITIES | 3 Months Ended |
Mar. 31, 2017 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
ACCRUED EXPENSES AND OTHER LIABILITIES | ACCRUED EXPENSES AND OTHER LIABILITIES March 31, 2017 December 31, 2016 Accrued Expenses Non-Current Liabilities Total Accrued Expenses Non-Current Liabilities Total (In thousands) Salaries and wages $ 68,831 — 68,831 $ 90,913 — 90,913 Deferred compensation 3,548 48,550 52,098 2,992 46,541 49,533 Pension benefits 3,808 455,625 459,433 3,796 451,940 455,736 Other postretirement benefits 1,507 19,365 20,872 1,506 19,459 20,965 Other employee benefits 11,437 2,325 13,762 29,358 5,854 35,212 Insurance obligations (1) 126,520 265,466 391,986 127,470 234,336 361,806 Operating taxes 98,717 — 98,717 92,150 — 92,150 Income taxes 1,784 24,091 25,875 4,197 23,174 27,371 Interest 28,807 — 28,807 27,277 — 27,277 Customer deposits 63,320 4,501 67,821 61,225 4,569 65,794 Deferred revenue 14,758 — 14,758 14,064 — 14,064 Restructuring liabilities (2) 4,387 — 4,387 7,278 — 7,278 Other 41,035 32,912 73,947 44,963 31,692 76,655 Total $ 468,459 852,835 1,321,294 $ 507,189 817,565 1,324,754 ———————————— (1) Insurance obligations are primarily comprised of self-insured claim liabilities. (2) The reduction in restructuring liabilities from December 31, 2016, principally represents cash payments for employee termination costs. The majority of the balance remaining in restructuring liabilities is expected to be paid by the end of 2017. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Weighted-Average Interest Rate March 31, December 31, Maturities March 31, December 31, (In thousands) Short-term debt and current portion of long-term debt: Short-term debt 1.06% 1.07% $ 190,252 177,629 Current portion of long-term debt 782,863 613,781 Total short-term debt and current portion of long-term debt 973,115 791,410 Long-term debt: U.S. commercial paper (1) 1.04% 0.87% 2020 349,510 342,480 Global revolving credit facility —% 2.06% 2020 — 4,703 Unsecured U.S. notes — Medium-term notes (1) 2.72% 2.67% 2017-2025 4,063,395 4,113,421 Unsecured U.S. obligations 2.19% 2.19% 2018 50,000 50,000 Unsecured foreign obligations 1.55% 1.55% 2017-2020 216,624 232,092 Asset-backed U.S. obligations (2) 1.80% 1.80% 2017-2022 449,033 459,876 Capital lease obligations 3.20% 3.17% 2017-2023 23,448 24,184 Total before fair market value adjustment 5,152,010 5,226,756 Fair market value adjustment on notes subject to hedging (3) (946 ) 1,110 Debt issuance costs (15,091 ) (14,221 ) 5,135,973 5,213,645 Current portion of long-term debt (782,863 ) (613,781 ) Long-term debt 4,353,110 4,599,864 Total debt $ 5,326,225 5,391,274 ———————————— (1) Amounts are net of unamortized original issue discounts of $7 million at March 31, 2017 and December 31, 2016 . (2) Asset-backed U.S. obligations are related to financing transactions involving revenue earning equipment. (3) The notional amount of the executed interest rate swaps designated as fair value hedges was $825 million at March 31, 2017 and December 31, 2016 . We maintain a $1.2 billion global revolving credit facility with a syndicate of twelve lending institutions led by Bank of America N.A., Bank of Tokyo-Mitsubishi UFJ, Ltd., BNP Paribas, Mizuho Corporate Bank, Ltd., Royal Bank of Canada, Lloyds Bank Plc, U.S. Bank National Association and Wells Fargo Bank, N.A. The facility matures in January 2020. The agreement provides for annual facility fees which range from 7.5 basis points to 25 basis points based on Ryder's long-term credit ratings. The annual facility fee is currently 10 basis points , which applies to the total facility size of $1.2 billion . The credit facility is used primarily to finance working capital but can also be used to issue up to $75 million in letters of credit (there were no letters of credit outstanding against the facility at March 31, 2017 ). At our option, the interest rate on borrowings under the credit facility is based on LIBOR, prime, federal funds or local equivalent rates. The credit facility contains no provisions limiting its availability in the event of a material adverse change to Ryder’s business operations; however, the credit facility does contain standard representations and warranties, events of default, cross-default provisions and certain affirmative and negative covenants. In order to maintain availability of funding, we must maintain a ratio of debt to consolidated net worth of less than or equal to 300% . Net worth, as defined in the credit facility, represents shareholders' equity excluding any accumulated other comprehensive income or loss associated with our pension and other postretirement plans. The ratio at March 31, 2017 was 197% . At March 31, 2017 , there was $660 million available under the credit facility. Our global revolving credit facility enables us to refinance short-term obligations on a long-term basis. Short-term commercial paper obligations not expected to require the use of working capital are classified as long-term as we have both the intent and ability to refinance on a long-term basis. In addition, we have the intent and ability to refinance the current portion of certain long-term debt on a long-term basis. At March 31, 2017 , we classified $350 million of short-term commercial paper and $50 million of the current portion of long-term debt as long-term debt. At December 31, 2016 , we classified $342 million of short-term commercial paper and $350 million of the current portion of long-term debt as long-term debt. In February 2017, we issued $300 million of unsecured medium-term notes maturing in March 2022. The proceeds from these notes were used to pay off maturing debt and for general corporate purposes. If these notes are downgraded below investment grade following, and as a result of, a change in control, the note holders can require us to repurchase all or a portion of the notes at a purchase price equal to 101% of principal value plus accrued and unpaid interest. We have a trade receivables purchase and sale program, pursuant to which we sell certain of our domestic trade accounts receivable to a bankruptcy remote, consolidated subsidiary of Ryder, that in turn sells, on a revolving basis, an ownership interest in certain of these accounts receivable to a committed purchaser. The subsidiary is considered a VIE and is consolidated based on our control of the entity’s activities. We use this program to provide additional liquidity to fund our operations, particularly when it is cost effective to do so. The costs under the program may vary based on changes in interest rates. The available proceeds that may be received under the program are limited to $175 million . The program was renewed in October 2016. If no event occurs which causes early termination, the 364 -day program will expire on October 23, 2017. The program contains provisions restricting its availability in the event of a material adverse change to our business operations or the collectibility of the collateralized receivables. Sales of receivables under this program are accounted for as secured borrowings based on our continuing involvement in the transferred assets. No amounts were outstanding under the program at March 31, 2017 or December 31, 2016 . At March 31, 2017 and December 31, 2016 , we had letters of credit and surety bonds outstanding totaling $358 million and $354 million , respectively, which primarily guarantee the payment of insurance claims. The fair value of total debt (excluding capital lease and asset-backed U.S. obligations) at March 31, 2017 and December 31, 2016 was approximately $4.91 billion and $4.97 billion , respectively. For publicly-traded debt, estimates of fair value were based on market prices. For other debt, fair value was estimated based on a model-driven approach using rates currently available to us for debt with similar terms and remaining maturities. The fair value measurements of our publicly-traded debt and other debt were classified within Level 2 of the fair value hierarchy. The carrying amounts reported in the Consolidated Condensed Balance Sheets for “Cash and cash equivalents,” “Receivables, net” and “Accounts payable” approximate fair value because of the immediate or short-term maturities of these financial instruments. |
DERIVATIVES
DERIVATIVES | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | DERIVATIVES From time to time, we enter into interest rate derivatives to manage our fixed and variable interest rate exposure and to better match the repricing of debt instruments to that of our portfolio of assets. We assess the risk that changes in interest rates will have either on the fair value of debt obligations or on the amount of future interest payments by monitoring changes in interest rate exposures and by evaluating hedging opportunities. We regularly monitor interest rate risk attributable to both our outstanding or forecasted debt obligations as well as any offsetting hedge positions. This risk management process involves the use of analytical techniques, including cash flow sensitivity analyses, to estimate the expected impact of changes in interest rates on our future cash flows. As of March 31, 2017 , we had interest rate swaps outstanding which are designated as fair value hedges for certain debt obligations, with a total notional value of $825 million and maturities through 2020 . Interest rate swaps are measured at fair value on a recurring basis using Level 2 fair value inputs. The fair value of these interest rate swaps was a liability of $1 million and an asset of $1 million as of March 31, 2017 and December 31, 2016 , respectively. The amounts are presented in "Other non-current liabilities" and "Direct financing leases and other assets" in our Consolidated Condensed Balance Sheets. Changes in the fair value of our interest rate swaps were offset by changes in the fair value of the hedged debt instruments. Accordingly, there was no ineffectiveness related to the interest rate swaps. |
SHARE REPURCHASE PROGRAMS
SHARE REPURCHASE PROGRAMS | 3 Months Ended |
Mar. 31, 2017 | |
Share Repurchase Programs [Abstract] | |
SHARE REPURCHASE PROGRAMS | SHARE REPURCHASE PROGRAMS In December 2015, our Board of Directors authorized a share repurchase program intended to mitigate the dilutive impact of shares issued under our employee stock plans (the program). Under the program, management is authorized to repurchase (i) up to 1.5 million shares of common stock, the sum of which will not exceed the number of shares issued to employees under the Company’s employee stock plans from December 1, 2015 to December 9, 2017, plus (ii) 0.5 million shares issued to employees that were not repurchased under the Company’s previous share repurchase program. The program limits aggregate share repurchases to no more than 2 million shares of Ryder common stock. Share repurchases of common stock are made periodically in open-market transactions and are subject to market conditions, legal requirements and other factors. Management may establish prearranged written plans for the Company under Rule 10b5-1 of the Securities Exchange Act of 1934 as part of the program, which allow for share repurchases during Ryder’s quarterly blackout periods as set forth in the trading plan. During the three months ended March 31, 2017 , we repurchased approximately 221,000 shares for $17 million . We did not repurchase any shares during the three months ended March 31, 2016 . |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The following summary sets forth the components of accumulated other comprehensive loss, net of tax: Currency Translation Adjustments and Other Net Actuarial Loss (1) Prior Service (Cost)/ Credit (1) Accumulated Other Comprehensive Loss (In thousands) December 31, 2016 $ (206,610 ) (620,292 ) (7,130 ) (834,032 ) Amortization — 5,011 53 5,064 Other current period change 15,742 — — 15,742 March 31, 2017 $ (190,868 ) (615,281 ) (7,077 ) (813,226 ) Currency Translation Adjustments and Other Net Actuarial Loss (1) Prior Service Credit (1) Accumulated Other Comprehensive Loss (In thousands) December 31, 2015 $ (136,020 ) (576,993 ) 278 (712,735 ) Amortization — 4,752 (37 ) 4,715 Other current period change 13,684 — — 13,684 March 31, 2016 $ (122,336 ) (572,241 ) 241 (694,336 ) _______________________ (1) These amounts are included in the computation of net pension expense. See Note 11 , " Employee Benefit Plans ," for further information. The gain from currency translation adjustments in the three months ended March 31, 2017 of $15.7 million was primarily due to the strengthening of the British Pound and the Canadian Dollar against the U.S. Dollar. The gain from currency translation adjustments in the three months ended March 31, 2016 of $13.7 million was due to the strengthening of the Canadian Dollar against the the U.S. Dollar, partially offset by the weakening of the British Pound against the U.S. Dollar. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table presents the calculation of basic and diluted earnings per common share from continuing operations: Three months ended March 31, 2017 2016 (In thousands, except per share amounts) Earnings per share — Basic: Earnings from continuing operations $ 38,279 56,185 Less: Earnings allocated to unvested stock (130 ) (166 ) Earnings from continuing operations available to common shareholders — Basic $ 38,149 56,019 Weighted average common shares outstanding — Basic 52,945 53,076 Earnings from continuing operations per common share — Basic $ 0.72 1.06 Earnings per share — Diluted: Earnings from continuing operations $ 38,279 56,185 Less: Earnings allocated to unvested stock (130 ) (166 ) Earnings from continuing operations available to common shareholders — Diluted $ 38,149 56,019 Weighted average common shares outstanding — Basic 52,945 53,076 Effect of dilutive equity awards 451 287 Weighted average common shares outstanding — Diluted 53,396 53,363 Earnings from continuing operations per common share — Diluted $ 0.71 1.05 Anti-dilutive equity awards not included above 591 1,186 |
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION PLANS | SHARE-BASED COMPENSATION PLANS Share-based incentive awards are provided to employees under the terms of various share-based compensation plans (collectively, the “Plans”). The Plans are administered by the Compensation Committee of the Board of Directors and principally include at-the-money stock options, unvested stock and cash awards. Unvested stock awards include grants of market-based, performance-based and time-vested restricted stock rights. Under the terms of our Plans, dividends are not paid unless the stock award vests. Upon vesting, the amount of the dividends paid is equal to the aggregate dividends declared on common shares during the period from the grant date of the award until the date the shares underlying the award are delivered. The following table provides information on share-based compensation expense and income tax benefits recognized during the periods: Three months ended March 31, 2017 2016 (In thousands) Stock option and stock purchase plans $ 1,905 1,873 Unvested stock 3,050 3,015 Share-based compensation expense 4,955 4,888 Income tax benefit (1,734 ) (1,655 ) Share-based compensation expense, net of tax $ 3,221 3,233 During the three months ended March 31, 2017 and 2016 , approximately 462,000 and 513,000 stock options, respectively, were granted under the Plans. These awards generally vest in equal annual installments over a three year period beginning on the date of grant. The stock options have contractual terms of ten years . The fair value of each option award at the date of grant was estimated using a Black-Scholes-Merton option-pricing valuation model. Share-based compensation expense is recognized on a straight-line basis over the vesting period. The weighted-average fair value per option granted during the three months ended March 31, 2017 and 2016 was $15.71 and $12.53 , respectively. During the three months ended March 31, 2017 and 2016 , approximately 45,000 and 34,000 market-based restricted stock rights were granted, respectively, under the Plans. The awards are segmented into three performance periods of one, two and three years. At the end of each performance period, up to 150% of the award in 2017 and 125% in 2016 may be earned based on Ryder's total shareholder return (TSR) compared to the target TSR of a peer group over the applicable performance period. If earned, employees will receive the grant of stock at the end of the relevant three-year performance period provided they continue to be employed with Ryder, subject to Compensation Committee approval. The fair value of the market-based restricted stock rights was estimated using a lattice-based option-pricing valuation model that incorporates a Monte-Carlo simulation. The fair value of the market-based awards was determined on the grant date and considers the likelihood of Ryder achieving the market-based condition. Share-based compensation expense is recognized on a straight-line basis over the vesting period. The weighted-average fair value per market-based restricted stock right granted during the three months ended March 31, 2017 and 2016 was $73.43 and $54.10 , respectively. During the three months ended March 31, 2017 and 2016 , approximately 142,000 and 58,000 performance-based restricted stock rights (PBRSRs), respectively, were awarded under the Plans. The awards are segmented into three one -year performance periods. For these awards, up to 150% of the awards in 2017 and 125% in 2016 may be earned based on Ryder's one-year adjusted return on capital (ROC) measured against an annual ROC target. If earned, employees will receive the grant of stock three years after the grant date, provided they continue to be employed with Ryder, subject to Compensation Committee approval. For accounting purposes, these awards are not considered granted until the Compensation Committee approves the annual ROC target. During the three months ended March 31, 2017 and 2016 , approximately 79,000 and 45,000 PBRSRs, respectively, were considered granted for accounting purposes. The fair value of the PBRSRs is determined and fixed on the grant date based on Ryder's stock price on the date of grant. Share-based compensation expense is recognized on a straight-line basis over the vesting period, based upon the probability that the performance target will be met. The weighted-average fair value per PBRSR granted during the three months ended March 31, 2017 and 2016 was $76.49 and $55.32 , respectively. During the three months ended March 31, 2017 and 2016 , approximately 85,000 and 111,000 time-vested restricted stock rights, respectively, were granted under the Plans. The time-vested restricted stock rights entitle the holder to shares of common stock when the awards generally vest at the end of the three -year period after the grant date. The fair value of the time-vested awards is determined and fixed based on Ryder’s stock price on the date of grant. Share-based compensation expense is recognized on a straight-line basis over the vesting period. The weighted-average fair value per time-vested restricted stock right granted during the three months ended March 31, 2017 and 2016 was $76.57 and $55.32 , respectively. During the three months ended March 31, 2016 , employees received market-based cash awards. The cash awards have the same vesting provisions as the market-based restricted stock rights. The cash awards are accounted for as liability awards under the share-based compensation accounting guidance as the awards are based upon the performance of our common stock and are settled in cash. As a result, the liability is adjusted to reflect fair value at the end of each reporting period. The fair value of the cash awards was estimated using a lattice-based option-pricing valuation model that incorporates a Monte-Carlo simulation. Share-based compensation expense is recognized on a straight-line basis over the vesting period. There were no market-based cash awards granted in 2017 . The following table is a summary of compensation expense recognized for market-based cash awards in addition to the share-based compensation expense reported in the previous table: Three months ended March 31, 2017 2016 (In thousands) Cash awards $ 77 151 Total unrecognized pre-tax compensation expense related to all share-based compensation arrangements at March 31, 2017 was $34.7 million and is expected to be recognized over a weighted-average period of 2.2 years. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Components of net pension expense were as follows: Three months ended March 31, 2017 2016 (In thousands) Pension Benefits Company-administered plans: Service cost $ 3,249 3,400 Interest cost 21,489 22,240 Expected return on plan assets (22,478 ) (23,085 ) Amortization of: Net actuarial loss 8,450 7,965 Prior service cost 145 — 10,855 10,520 Union-administered plans 2,502 2,322 Net pension expense $ 13,357 12,842 Company-administered plans: U.S. $ 11,311 11,175 Non-U.S. (456 ) (655 ) 10,855 10,520 Union-administered plans 2,502 2,322 Net pension expense $ 13,357 12,842 During the three months ended March 31, 2017 , we contributed $3.7 million to our pension plans. In 2017 , the expected total contributions to our pension plans are approximately $ 23.7 million . We also maintain other postretirement benefit plans that are not reflected in the above table. The amount of postretirement benefit expense was not material for the three months ended March 31, 2017 . |
OTHER ITEMS IMPACTING COMPARABI
OTHER ITEMS IMPACTING COMPARABILITY | 3 Months Ended |
Mar. 31, 2017 | |
Other Income and Expenses [Abstract] | |
OTHER ITEMS IMPACTING COMPARABILITY | OTHER ITEMS IMPACTING COMPARABILITY During the three months ended March 31, 2017 , we determined that certain operating tax expenses related to prior periods had not been recognized in prior period earnings. We recorded a one-time charge of $2.2 million within “Selling, general and administrative expenses” in our Consolidated Condensed Statement of Earnings as the impact of the adjustment was not material to our consolidated condensed financial statements in any individual prior period, and the cumulative amount is not material to the first quarter 2017 results. |
OTHER MATTERS
OTHER MATTERS | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
OTHER MATTERS | OTHER MATTERS We are a party to various claims, complaints and proceedings arising in the ordinary course of our continuing business operations including, but not limited to, those relating to commercial and employment claims, environmental matters, risk management matters (e.g., vehicle liability, workers’ compensation, etc.) and administrative assessments primarily associated with operating taxes. We have established loss provisions for matters in which losses are probable and can be reasonably estimated. We believe that the resolution of these claims, complaints and legal proceedings will not have a material effect on our consolidated condensed financial statements. Our estimates regarding potential losses and materiality are based on our judgment and assessment of the claims utilizing currently available information. Although we will continue to reassess our reserves and estimates based on future developments, our objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from our current estimates. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 3 Months Ended |
Mar. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION Supplemental cash flow information was as follows: Three months ended March 31, 2017 2016 (In thousands) Interest paid $ 31,441 34,421 Income taxes paid 3,107 4,750 Changes in accounts payable related to purchases of revenue earning equipment 74,766 (77,486 ) Operating and revenue earning equipment acquired under capital leases 1,607 240 |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING Our operating segments are aggregated into reportable business segments based upon similar economic characteristics, products, services, customers and delivery methods. We report our financial performance in three business segments: (1) FMS, which provides leasing, commercial rental and maintenance of trucks, tractors and trailers to customers principally in the U.S., Canada and the U.K.; (2) DTS, which provides vehicles and drivers as part of a dedicated transportation solution in the U.S.; and (3) SCS, which provides comprehensive supply chain solutions including distribution and transportation services in North America and Asia. Dedicated transportation services provided as part of an integrated, multi-service, supply chain solution to SCS customers are reported in the SCS business segment. Our primary measurement of segment financial performance, defined as segment “Earnings Before Tax” (EBT) from continuing operations, includes an allocation of Central Support Services (CSS) and excludes non-operating pension costs and the operating tax adjustment discussed in Note 12 "Other Items Impacting Comparability." CSS represents those costs incurred to support all business segments, including human resources, finance, corporate services, public affairs, information technology, health and safety, legal, marketing and corporate communications. The objective of the EBT measurement is to provide clarity on the profitability of each segment and, ultimately, to hold leadership of each segment accountable for their allocated share of CSS costs. Certain costs are considered to be overhead not attributable to any segment and remain unallocated in CSS. Included among the unallocated overhead remaining within CSS are the costs for investor relations, public affairs and certain executive compensation. CSS costs attributable to the business segments are predominantly allocated to FMS, DTS and SCS as follows: • Finance, corporate services, and health and safety — allocated based upon estimated and planned resource utilization; • Human resources — individual costs within this category are allocated under various methods, including allocation based on estimated utilization and number of personnel supported; • Information technology — principally allocated based upon utilization-related metrics such as number of users or minutes of CPU time. Customer-related project costs and expenses are allocated to the business segment responsible for the project; and • Other — represents legal and other centralized costs and expenses including certain share-based incentive compensation costs. Expenses, where allocated, are based primarily on the number of personnel supported. Our FMS segment leases revenue earning equipment and provides fuel, maintenance and other ancillary services to the DTS and SCS segments. Inter-segment revenue and EBT are accounted for at rates similar to those executed with third parties. EBT related to inter-segment equipment and services billed to DTS and SCS customers (equipment contribution) are included in both FMS and the segment that served the customer and then eliminated (presented as “Eliminations”). The following tables set forth financial information for each of our segments and provide a reconciliation between segment EBT and earnings from continuing operations before income taxes for the three months ended March 31, 2017 and 2016 . Segment results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. FMS DTS SCS Eliminations Total (In thousands) For the three months ended March 31, 2017 Revenue from external customers $ 1,018,740 266,674 462,749 — 1,748,163 Inter-segment revenue 113,730 — — (113,730 ) — Total revenue $ 1,132,470 266,674 462,749 (113,730 ) 1,748,163 Segment EBT $ 52,108 11,279 27,446 (11,216 ) 79,617 Unallocated CSS (10,213 ) Non-operating pension costs (7,243 ) Other items (1) (2,205 ) Earnings from continuing operations before income taxes $ 59,956 Segment capital expenditures paid (2) $ 344,355 768 10,998 — 356,121 Unallocated CSS capital expenditures paid 5,218 Capital expenditures paid $ 361,339 For the three months ended March 31, 2016 Revenue from external customers $ 996,115 244,842 388,715 — 1,629,672 Inter-segment revenue 101,813 — — (101,813 ) — Total revenue $ 1,097,928 244,842 388,715 (101,813 ) 1,629,672 Segment EBT $ 83,301 14,268 19,796 (11,744 ) 105,621 Unallocated CSS (10,045 ) Non-operating pension costs (6,868 ) Earnings from continuing operations before income taxes $ 88,708 Segment capital expenditures paid (2) $ 560,285 517 7,323 — 568,125 Unallocated CSS capital expenditures paid 6,906 Capital expenditures paid $ 575,031 ———————————— (1) See Note 12, "Other Items Impacting Comparability," for additional information. (2) Excludes revenue earning equipment acquired under capital leases. |
RECENT ACCOUNTING PRONOUNCEME22
RECENT ACCOUNTING PRONOUNCEMENTS (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Employee Benefits Plans In March 2017, the FASB issued ASU No. 2017-07, Compensation-Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost , which requires an employer to report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. The amendments in this update also allow only the service cost component to be eligible for capitalization when applicable. The standard is effective January 1, 2018, with early adoption as of January 1, 2017 permitted. We adopted the standard during the first quarter of 2017, and recorded the other components of net benefit cost within "Non-service retirement benefit costs" in the Consolidated Condensed Statements of Earnings for both the current and prior year periods. Intangibles - Goodwill and Other In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment , which requires an entity to perform a one-step quantitative impairment test, whereby a goodwill impairment loss will be measured as the excess of a reporting unit’s carrying amount over its fair value (not to exceed the total goodwill allocated to that reporting unit). It eliminates Step 2 of the current two-step goodwill impairment test, under which a goodwill impairment loss is measured by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. The standard is effective January 1, 2020, with early adoption as of January 1, 2017 permitted. We adopted the standard during the first quarter of 2017 and it did not have a material impact on our consolidated financial position, results of operations and cash flows. Statement of Cash Flows In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows, which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. In November 2016, the FASB issued additional guidance related to the statement of cash flows, which requires companies to explain the change during the period in the total of cash, cash equivalents, and restricted cash or restricted cash equivalents. The standard is effective January 1, 2018, with early adoption permitted. We will adopt the standard as of January 1, 2018, on a retrospective basis. We do not expect this standard to have a material impact on the presentation of our consolidated cash flows. Leases In February 2016, the FASB issued ASU No. 2016-02, Leases, which sets out the principles for the recognition, measurement, presentation and disclosure of leases. The standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. We will adopt the standard effective January 1, 2019, using the modified retrospective transition method. We do not anticipate a material impact upon adoption of the standard on our consolidated financial position, results of operations and cash flows. Revenue Recognition In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers , which together with related, subsequently issued guidance, requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The adoption of ASU 2014-09 will primarily impact our ChoiceLease product line, which includes a vehicle lease as well as maintenance and other services related to the vehicle. We will generally continue to recognize revenue for the vehicle lease portion of the product line on a straight-line basis. Revenue from the non-lease portion of the product line, primarily maintenance services, will be recognized at the time the maintenance services are performed, which will generally require the deferral of some portion of the customer's lease payments when received, as maintenance services are not performed evenly over the life of a ChoiceLease contract. Under current GAAP, substantially all revenues from our ChoiceLease arrangements are recognized on a straight line basis over the term of the lease. We will adopt the standard on January 1, 2018, using the full retrospective transition method, which will result in a cumulative-effect adjustment to recognize deferred revenue on the opening balance sheet for 2016 and the restatement of the financial statements for all prior periods presented (2016 and 2017). We continue to evaluate the impact of adoption of this standard on our consolidated financial position, results of operations and cash flows. |
REVENUE EARNING EQUIPMENT (Tabl
REVENUE EARNING EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Revenue Earning Equipment [Abstract] | |
Summary of revenue earning equipment | March 31, 2017 December 31, 2016 Cost Accumulated Depreciation Net Book Value (1) Cost Accumulated Depreciation Net Book Value (1) (In thousands) Held for use: ChoiceLease $ 9,664,962 (3,159,228 ) 6,505,734 $ 9,486,977 (3,031,937 ) 6,455,040 Commercial rental 2,492,992 (942,309 ) 1,550,683 2,499,010 (935,346 ) 1,563,664 Held for sale 439,022 (324,263 ) 114,759 494,355 (365,337 ) 129,018 Total $ 12,596,976 (4,425,800 ) 8,171,176 $ 12,480,342 (4,332,620 ) 8,147,722 ———————————— (1) Revenue earning equipment, net book value includes vehicles acquired under capital leases of $37 million , less accumulated depreciation of $17 million , at March 31, 2017 , and $43 million , less accumulated depreciation of $22 million , at December 31, 2016 . |
Fair value, assets | The following table presents our assets held for sale that are measured at fair value on a nonrecurring basis and considered a Level 3 fair value measurement: Total Losses (2) March 31, Three months ended March 31, 2017 2016 2017 2016 (In thousands) Assets held for sale: Revenue earning equipment (1) : Trucks $ 12,228 11,538 $ 5,800 1,744 Tractors 38,383 39,739 5,183 4,882 Trailers 2,303 3,153 568 662 Total assets at fair value $ 52,914 54,430 $ 11,551 7,288 ———————————— (1) Assets held for sale in the above table only include the portion of revenue earning equipment held for sale where net book values exceeded fair values and fair value adjustments were recorded. The net book value of assets held for sale not exceeding fair value was $62 million and $120 million as of March 31, 2017 and 2016 , respectively. (2) Total losses represent fair value adjustments for all vehicles reclassified to held for sale throughout the period for which fair value was less than carrying value. |
Gain and Losses Revenue Earning Equipment | For the three months ended March 31, 2017 and 2016 , the components of used vehicle sales, net were as follows: Three months ended March 31, 2017 2016 (In thousands) Gains on vehicle sales, net $ (12,331 ) (26,417 ) Losses from fair value adjustments 11,551 7,288 Used vehicle sales, net $ (780 ) (19,129 ) |
ACCRUED EXPENSES AND OTHER LI24
ACCRUED EXPENSES AND OTHER LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Accrued Expenses and Other Liabilities | March 31, 2017 December 31, 2016 Accrued Expenses Non-Current Liabilities Total Accrued Expenses Non-Current Liabilities Total (In thousands) Salaries and wages $ 68,831 — 68,831 $ 90,913 — 90,913 Deferred compensation 3,548 48,550 52,098 2,992 46,541 49,533 Pension benefits 3,808 455,625 459,433 3,796 451,940 455,736 Other postretirement benefits 1,507 19,365 20,872 1,506 19,459 20,965 Other employee benefits 11,437 2,325 13,762 29,358 5,854 35,212 Insurance obligations (1) 126,520 265,466 391,986 127,470 234,336 361,806 Operating taxes 98,717 — 98,717 92,150 — 92,150 Income taxes 1,784 24,091 25,875 4,197 23,174 27,371 Interest 28,807 — 28,807 27,277 — 27,277 Customer deposits 63,320 4,501 67,821 61,225 4,569 65,794 Deferred revenue 14,758 — 14,758 14,064 — 14,064 Restructuring liabilities (2) 4,387 — 4,387 7,278 — 7,278 Other 41,035 32,912 73,947 44,963 31,692 76,655 Total $ 468,459 852,835 1,321,294 $ 507,189 817,565 1,324,754 ———————————— (1) Insurance obligations are primarily comprised of self-insured claim liabilities. (2) The reduction in restructuring liabilities from December 31, 2016, principally represents cash payments for employee termination costs. The majority of the balance remaining in restructuring liabilities is expected to be paid by the end of 2017. |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Weighted-Average Interest Rate March 31, December 31, Maturities March 31, December 31, (In thousands) Short-term debt and current portion of long-term debt: Short-term debt 1.06% 1.07% $ 190,252 177,629 Current portion of long-term debt 782,863 613,781 Total short-term debt and current portion of long-term debt 973,115 791,410 Long-term debt: U.S. commercial paper (1) 1.04% 0.87% 2020 349,510 342,480 Global revolving credit facility —% 2.06% 2020 — 4,703 Unsecured U.S. notes — Medium-term notes (1) 2.72% 2.67% 2017-2025 4,063,395 4,113,421 Unsecured U.S. obligations 2.19% 2.19% 2018 50,000 50,000 Unsecured foreign obligations 1.55% 1.55% 2017-2020 216,624 232,092 Asset-backed U.S. obligations (2) 1.80% 1.80% 2017-2022 449,033 459,876 Capital lease obligations 3.20% 3.17% 2017-2023 23,448 24,184 Total before fair market value adjustment 5,152,010 5,226,756 Fair market value adjustment on notes subject to hedging (3) (946 ) 1,110 Debt issuance costs (15,091 ) (14,221 ) 5,135,973 5,213,645 Current portion of long-term debt (782,863 ) (613,781 ) Long-term debt 4,353,110 4,599,864 Total debt $ 5,326,225 5,391,274 ———————————— (1) Amounts are net of unamortized original issue discounts of $7 million at March 31, 2017 and December 31, 2016 . (2) Asset-backed U.S. obligations are related to financing transactions involving revenue earning equipment. (3) The notional amount of the executed interest rate swaps designated as fair value hedges was $825 million at March 31, 2017 and December 31, 2016 . |
ACCUMULATED OTHER COMPREHENSI26
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive loss, net of tax | The following summary sets forth the components of accumulated other comprehensive loss, net of tax: Currency Translation Adjustments and Other Net Actuarial Loss (1) Prior Service (Cost)/ Credit (1) Accumulated Other Comprehensive Loss (In thousands) December 31, 2016 $ (206,610 ) (620,292 ) (7,130 ) (834,032 ) Amortization — 5,011 53 5,064 Other current period change 15,742 — — 15,742 March 31, 2017 $ (190,868 ) (615,281 ) (7,077 ) (813,226 ) Currency Translation Adjustments and Other Net Actuarial Loss (1) Prior Service Credit (1) Accumulated Other Comprehensive Loss (In thousands) December 31, 2015 $ (136,020 ) (576,993 ) 278 (712,735 ) Amortization — 4,752 (37 ) 4,715 Other current period change 13,684 — — 13,684 March 31, 2016 $ (122,336 ) (572,241 ) 241 (694,336 ) _______________________ (1) These amounts are included in the computation of net pension expense. See Note 11 , " Employee Benefit Plans ," for further information. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted earnings per common share from continuing operations | The following table presents the calculation of basic and diluted earnings per common share from continuing operations: Three months ended March 31, 2017 2016 (In thousands, except per share amounts) Earnings per share — Basic: Earnings from continuing operations $ 38,279 56,185 Less: Earnings allocated to unvested stock (130 ) (166 ) Earnings from continuing operations available to common shareholders — Basic $ 38,149 56,019 Weighted average common shares outstanding — Basic 52,945 53,076 Earnings from continuing operations per common share — Basic $ 0.72 1.06 Earnings per share — Diluted: Earnings from continuing operations $ 38,279 56,185 Less: Earnings allocated to unvested stock (130 ) (166 ) Earnings from continuing operations available to common shareholders — Diluted $ 38,149 56,019 Weighted average common shares outstanding — Basic 52,945 53,076 Effect of dilutive equity awards 451 287 Weighted average common shares outstanding — Diluted 53,396 53,363 Earnings from continuing operations per common share — Diluted $ 0.71 1.05 Anti-dilutive equity awards not included above 591 1,186 |
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based compensation expense and income tax benefits recognized during the periods | The following table provides information on share-based compensation expense and income tax benefits recognized during the periods: Three months ended March 31, 2017 2016 (In thousands) Stock option and stock purchase plans $ 1,905 1,873 Unvested stock 3,050 3,015 Share-based compensation expense 4,955 4,888 Income tax benefit (1,734 ) (1,655 ) Share-based compensation expense, net of tax $ 3,221 3,233 |
Summary of share-based compensation expense recognized related to cash awards | The following table is a summary of compensation expense recognized for market-based cash awards in addition to the share-based compensation expense reported in the previous table: Three months ended March 31, 2017 2016 (In thousands) Cash awards $ 77 151 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of net periodic benefit cost | Components of net pension expense were as follows: Three months ended March 31, 2017 2016 (In thousands) Pension Benefits Company-administered plans: Service cost $ 3,249 3,400 Interest cost 21,489 22,240 Expected return on plan assets (22,478 ) (23,085 ) Amortization of: Net actuarial loss 8,450 7,965 Prior service cost 145 — 10,855 10,520 Union-administered plans 2,502 2,322 Net pension expense $ 13,357 12,842 Company-administered plans: U.S. $ 11,311 11,175 Non-U.S. (456 ) (655 ) 10,855 10,520 Union-administered plans 2,502 2,322 Net pension expense $ 13,357 12,842 |
SUPPLEMENTAL CASH FLOW INFORM30
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental cash flow information | Supplemental cash flow information was as follows: Three months ended March 31, 2017 2016 (In thousands) Interest paid $ 31,441 34,421 Income taxes paid 3,107 4,750 Changes in accounts payable related to purchases of revenue earning equipment 74,766 (77,486 ) Operating and revenue earning equipment acquired under capital leases 1,607 240 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Financial information of business segments | The following tables set forth financial information for each of our segments and provide a reconciliation between segment EBT and earnings from continuing operations before income taxes for the three months ended March 31, 2017 and 2016 . Segment results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. FMS DTS SCS Eliminations Total (In thousands) For the three months ended March 31, 2017 Revenue from external customers $ 1,018,740 266,674 462,749 — 1,748,163 Inter-segment revenue 113,730 — — (113,730 ) — Total revenue $ 1,132,470 266,674 462,749 (113,730 ) 1,748,163 Segment EBT $ 52,108 11,279 27,446 (11,216 ) 79,617 Unallocated CSS (10,213 ) Non-operating pension costs (7,243 ) Other items (1) (2,205 ) Earnings from continuing operations before income taxes $ 59,956 Segment capital expenditures paid (2) $ 344,355 768 10,998 — 356,121 Unallocated CSS capital expenditures paid 5,218 Capital expenditures paid $ 361,339 For the three months ended March 31, 2016 Revenue from external customers $ 996,115 244,842 388,715 — 1,629,672 Inter-segment revenue 101,813 — — (101,813 ) — Total revenue $ 1,097,928 244,842 388,715 (101,813 ) 1,629,672 Segment EBT $ 83,301 14,268 19,796 (11,744 ) 105,621 Unallocated CSS (10,045 ) Non-operating pension costs (6,868 ) Earnings from continuing operations before income taxes $ 88,708 Segment capital expenditures paid (2) $ 560,285 517 7,323 — 568,125 Unallocated CSS capital expenditures paid 6,906 Capital expenditures paid $ 575,031 ———————————— (1) See Note 12, "Other Items Impacting Comparability," for additional information. (2) Excludes revenue earning equipment acquired under capital leases. |
REVENUE EARNING EQUIPMENT Sched
REVENUE EARNING EQUIPMENT Schedule of Revenue Earning Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Revenue Earning Equipment [Line Items] | ||
Cost | $ 12,596,976 | $ 12,480,342 |
Accumulated Depreciation | (4,425,800) | (4,332,620) |
Net Book Value | 8,171,176 | 8,147,722 |
ChoiceLease | ||
Revenue Earning Equipment [Line Items] | ||
Cost | 9,664,962 | 9,486,977 |
Accumulated Depreciation | (3,159,228) | (3,031,937) |
Net Book Value | 6,505,734 | 6,455,040 |
Commercial rental | ||
Revenue Earning Equipment [Line Items] | ||
Cost | 2,492,992 | 2,499,010 |
Accumulated Depreciation | (942,309) | (935,346) |
Net Book Value | 1,550,683 | 1,563,664 |
Held for sale | ||
Revenue Earning Equipment [Line Items] | ||
Cost | 439,022 | 494,355 |
Accumulated Depreciation | (324,263) | (365,337) |
Net Book Value | 114,759 | 129,018 |
Assets held under capital leases | ||
Revenue Earning Equipment [Line Items] | ||
Cost | 37,000 | 43,000 |
Accumulated Depreciation | $ (17,000) | $ (22,000) |
REVENUE EARNING EQUIPMENT (Deta
REVENUE EARNING EQUIPMENT (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Revenue Earning Equipment [Line Items] | ||
Net investment in direct financing and sales-type leases | $ 404,000,000 | $ 409,000,000 |
Direct financing leases and other assets | $ 0 | $ 0 |
Trucks | Minimum | ||
Revenue Earning Equipment [Line Items] | ||
Lease term | 3 years | |
Trucks | Maximum | ||
Revenue Earning Equipment [Line Items] | ||
Lease term | 7 years | |
Trailers | Maximum | ||
Revenue Earning Equipment [Line Items] | ||
Lease term | 10 years |
REVENUE EARNING EQUIPMENT Level
REVENUE EARNING EQUIPMENT Level 3 Fair Value Measurement (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenue Earning Equipment [Line Items] | ||
Total Losses | $ 11,551 | $ 7,288 |
Assets Held-for-sale, Long Lived, Fair Value Disclosure | 62,000 | 120,000 |
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Nonrecurring | ||
Revenue Earning Equipment [Line Items] | ||
Assets Held For Sale Fair Value Disclosure | 52,914 | 54,430 |
Total Losses | 11,551 | 7,288 |
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Nonrecurring | Trucks | ||
Revenue Earning Equipment [Line Items] | ||
Assets Held For Sale Fair Value Disclosure | 12,228 | 11,538 |
Total Losses | 5,800 | 1,744 |
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Nonrecurring | Tractors | ||
Revenue Earning Equipment [Line Items] | ||
Assets Held For Sale Fair Value Disclosure | 38,383 | 39,739 |
Total Losses | 5,183 | 4,882 |
Fair Value, Inputs, Level 3 | Fair Value, Measurements, Nonrecurring | Trailers | ||
Revenue Earning Equipment [Line Items] | ||
Assets Held For Sale Fair Value Disclosure | 2,303 | 3,153 |
Total Losses | $ 568 | $ 662 |
REVENUE EARNING EQUIPMENT Recog
REVENUE EARNING EQUIPMENT Recognized Gains on Used Vehicles (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenue Earning Equipment [Abstract] | ||
Gains on vehicle sales, net | $ (12,331) | $ (26,417) |
Losses from fair value adjustments | 11,551 | 7,288 |
Used vehicle sales, net | $ (780) | $ (19,129) |
ACCRUED EXPENSES AND OTHER LI36
ACCRUED EXPENSES AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Accrued Expenses | ||
Salaries and wages | $ 68,831 | $ 90,913 |
Deferred compensation | 3,548 | 2,992 |
Pension benefits | 3,808 | 3,796 |
Other postretirement benefits | 1,507 | 1,506 |
Other employee benefits | 11,437 | 29,358 |
Insurance obligations | 126,520 | 127,470 |
Operating taxes | 98,717 | 92,150 |
Income taxes | 1,784 | 4,197 |
Interest | 28,807 | 27,277 |
Customer deposits | 63,320 | 61,225 |
Deferred revenue | 14,758 | 14,064 |
Restructuring liabilities | 4,387 | 7,278 |
Other | 41,035 | 44,963 |
Total | 468,459 | 507,189 |
Non-Current Liabilities | ||
Salaries and wages | 0 | 0 |
Deferred compensation | 48,550 | 46,541 |
Pension benefits | 455,625 | 451,940 |
Other postretirement benefits | 19,365 | 19,459 |
Other employee benefits | 2,325 | 5,854 |
Insurance obligations | 265,466 | 234,336 |
Operating taxes | 0 | 0 |
Income taxes | 24,091 | 23,174 |
Interest | 0 | 0 |
Customer deposits | 4,501 | 4,569 |
Deferred revenue | 0 | 0 |
Restructuring liabilities | 0 | 0 |
Other | 32,912 | 31,692 |
Total | 852,835 | 817,565 |
Total | ||
Salaries and wages | 68,831 | 90,913 |
Deferred compensation | 52,098 | 49,533 |
Pension benefits | 459,433 | 455,736 |
Other postretirement benefits | 20,872 | 20,965 |
Other employee benefits | 13,762 | 35,212 |
Insurance obligations | 391,986 | 361,806 |
Operating taxes | 98,717 | 92,150 |
Income taxes | 25,875 | 27,371 |
Interest | 28,807 | 27,277 |
Customer deposits | 67,821 | 65,794 |
Deferred revenue | 14,758 | 14,064 |
Restructuring liabilities | 4,387 | 7,278 |
Other | 73,947 | 76,655 |
Total | $ 1,321,294 | $ 1,324,754 |
DEBT Schedule of Debt (Details)
DEBT Schedule of Debt (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Short-term debt and current portion of long-term debt: | ||
Short-term debt, weighted-average interest rate | 1.06% | 1.07% |
Short-term debt | $ 190,252,000 | $ 177,629,000 |
Current portion of long-term debt | 782,863,000 | 613,781,000 |
Total short-term debt and current portion of long-term debt | 973,115,000 | 791,410,000 |
Long-term debt: | ||
Total before fair market value adjustment | 5,152,010,000 | 5,226,756,000 |
Fair market value adjustment on notes subject to hedging | (946,000) | 1,110,000 |
Total after fair market value adjustment | 5,135,973,000 | 5,213,645,000 |
Current portion of long-term debt | (782,863,000) | (613,781,000) |
Long-term debt | 4,353,110,000 | 4,599,864,000 |
Total debt | 5,326,225,000 | 5,391,274,000 |
Unamortized original issue discounts | 7,000,000 | 7,000,000 |
Aggregate notional amount of interest rate swaps | $ 825,000,000 | $ 825,000,000 |
U.S. commercial paper | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 1.04% | 0.87% |
U.S. commercial paper | $ 349,510,000 | $ 342,480,000 |
Global revolving credit facility | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 0.00% | 2.06% |
Global revolving credit facility | $ 0 | $ 4,703,000 |
Unsecured U.S. notes — Medium-term notes | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 2.72% | 2.67% |
Unsecured U.S. notes - Medium-term notes | $ 4,063,395,000 | $ 4,113,421,000 |
Debt issuance costs | $ (15,091,000) | $ (14,221,000) |
Unsecured U.S. obligations | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 2.19% | 2.19% |
Unsecured U.S. obligations | $ 50,000,000 | $ 50,000,000 |
Unsecured foreign obligations | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 1.55% | 1.55% |
Obligations | $ 216,624,000 | $ 232,092,000 |
Asset-backed U.S. obligations | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 1.80% | 1.80% |
Obligations | $ 449,033,000 | $ 459,876,000 |
Capital lease obligations | ||
Long-term debt: | ||
Long-term debt, weighted-average interest rate | 3.20% | 3.17% |
Capital lease obligations | $ 23,448,000 | $ 24,184,000 |
DEBT (Details Textual)
DEBT (Details Textual) | 3 Months Ended | ||
Mar. 31, 2017USD ($)instution | Feb. 28, 2017USD ($) | Dec. 31, 2016USD ($) | |
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 1,200,000,000 | ||
Number of lending institutions | instution | 12 | ||
Annual facility fees, percentage | 10.00% | ||
Ratio of debt to consolidated net worth | 3 | ||
Debt to consolidated tangible net worth ratio | 197.00% | ||
Line of credit remaining capacity | $ 660,000,000 | ||
Total available proceeds under trade receivables purchase and sale program | $ 175,000,000 | ||
Number of days under trade receivables purchase and sale program | 364 days | ||
Trade receivables borrowings | $ 0 | $ 0 | |
Letters of credit and surety bonds outstanding | 358,000,000 | 354,000,000 | |
Fair value of total debt | 4,910,000,000 | 4,970,000,000 | |
U.S. commercial paper | |||
Debt Instrument [Line Items] | |||
Commercial paper classified as long term debt | 349,510,000 | 342,480,000 | |
Unsecured U.S. obligations | |||
Debt Instrument [Line Items] | |||
Loans Payable to Bank | $ 50,000,000 | 50,000,000 | |
Global revolving credit facility | |||
Debt Instrument [Line Items] | |||
Current maturities classified as long-term debt | $ 350,000,000 | ||
Unsecured medium term notes due march 2020 | |||
Debt Instrument [Line Items] | |||
Face amount of unsecured medium-term notes issued | $ 300,000,000 | ||
Debt repurchase price, percentage | 101.00% | ||
Letter of Credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 75,000,000 | ||
Letter of credit outstanding amount | $ 0 | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Annual facility fees, percentage | 7.50% | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Annual facility fees, percentage | 25.00% |
DERIVATIVES (Details)
DERIVATIVES (Details) - USD ($) | Mar. 31, 2017 | Dec. 31, 2016 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Aggregate notional amount of interest rate swaps | $ 825,000,000 | $ 825,000,000 |
Face value of medium-term notes | $ (1,000,000) | $ 1,000,000 |
SHARE REPURCHASE PROGRAMS (Deta
SHARE REPURCHASE PROGRAMS (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
December 2015 Program | ||||
Accelerated Share Repurchases [Line Items] | ||||
Common stock repurchases | $ 17 | |||
Common Stock | December 2015 Program | ||||
Accelerated Share Repurchases [Line Items] | ||||
Repurchased and retired shares (in shares) | 221,000 | 0 | ||
December 2015 Program | ||||
Accelerated Share Repurchases [Line Items] | ||||
Maximum number of share repurchases authorization (in shares) | 1,500,000 | |||
Number of shares authorized to be repurchased (in shares) | 2,000,000 | |||
December 2015 Program | December Two Thousand Thirteen Anti Dilutive Share Repurchase Program | ||||
Accelerated Share Repurchases [Line Items] | ||||
Number of shares authorized to be repurchased (in shares) | 500,000 |
ACCUMULATED OTHER COMPREHENSI41
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | $ (813,226) | $ (694,336) |
Amortization | 5,064 | 4,715 |
Other current period change | 15,742 | 13,684 |
Ending balance | (834,032) | (712,735) |
Currency Translation Adjustments and Other | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | (190,868) | (122,336) |
Other current period change | 15,742 | 13,684 |
Ending balance | (206,610) | (136,020) |
Net Actuarial Loss | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | (615,281) | (572,241) |
Amortization | 5,011 | 4,752 |
Other current period change | 0 | 0 |
Ending balance | (620,292) | (576,993) |
Prior Service (Cost)/ Credit | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Beginning balance | (7,077) | 241 |
Amortization | 53 | (37) |
Other current period change | 0 | 0 |
Ending balance | $ (7,130) | $ 278 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings per share — Basic: | ||
Earnings from continuing operations | $ 38,279 | $ 56,185 |
Less: Earnings allocated to unvested stock | (130) | (166) |
Earnings from continuing operations available to common shareholders — Basic | $ 38,149 | $ 56,019 |
Weighted average common shares outstanding - Basic (shares) | 52,945 | 53,076 |
Earnings from continuing operations per common share — Basic (in dollars per share) | $ 0.72 | $ 1.06 |
Earnings per share — Diluted: | ||
Earnings from continuing operations | $ 38,279 | $ 56,185 |
Less: Earnings allocated to unvested stock | (130) | (166) |
Earnings from continuing operations available to common shareholders — Diluted | $ 38,149 | $ 56,019 |
Weighted average common shares outstanding - Basic (shares) | 52,945 | 53,076 |
Effect of dilutive equity awards (shares) | 451 | 287 |
Weighted average common shares outstanding — Diluted (shares) | 53,396 | 53,363 |
Earnings from continuing operations per common share — Diluted (in dollars per share) | $ 0.71 | $ 1.05 |
Anti-dilutive equity awards not included above (shares) | 591 | 1,186 |
SHARE-BASED COMPENSATION PLAN43
SHARE-BASED COMPENSATION PLANS Share-based compensation expense and income tax benefits recognized during the periods (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 4,955 | $ 4,888 |
Income tax benefit | (1,734) | (1,655) |
Share-based compensation expense, net of tax | 3,221 | 3,233 |
Stock option and stock purchase plans | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | 1,905 | 1,873 |
Unvested stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 3,050 | $ 3,015 |
SHARE-BASED COMPENSATION PLAN44
SHARE-BASED COMPENSATION PLANS Compensation expense recognized for market-based cash awards (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Cash awards | $ 77 | $ 151 |
SHARE-BASED COMPENSATION PLAN45
SHARE-BASED COMPENSATION PLANS (Details Textual) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017USD ($)award$ / sharesshares | Mar. 31, 2016$ / sharesshares | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding options, term | 10 years | ||
Performance-based restricted stock awards granted | 79,000 | 45,000 | |
Number of performance periods for which market-based restricted stock will be measured for vesting purposes | award | 3 | ||
Award vesting period | 1 year | ||
Compensation cost not yet recognized | $ | $ 34.7 | ||
Compensation cost not yet recognized, period for recognition | 2 years 2 months 12 days | ||
Employee Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options, grants in period (in shares) | 462,000 | 513,000 | |
Options, grants in period, weighted average exercise price (in dollars per share) | $ / shares | $ 15.71 | $ 12.53 | |
Market Based Vested | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 45,000 | 34,000 | |
Grants in period, weighted average grant date fair value (in dollars per share) | $ / shares | $ 73.43 | $ 54.10 | |
Market Based Restricted Stock Rights, 2012 Grant | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Potential performance award percentage | 150.00% | 125.00% | |
Performance-Based Vested | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 142,000 | 58,000 | |
Grants in period, weighted average grant date fair value (in dollars per share) | $ / shares | $ 76.49 | $ 55.32 | |
ROC performance based restricted stock rights, 2013 Grant | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Potential performance award percentage | 150.00% | 125.00% | |
Time Vested | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 85,000 | 111,000 | |
Grants in period, weighted average grant date fair value (in dollars per share) | $ / shares | $ 76.57 | $ 55.32 | |
Time Vested Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Amortization of: | ||
Net pension expense | $ 13,357 | $ 12,842 |
Contribution to pension plans | 3,700 | |
Estimated total contributions | 23,700 | |
Pension Benefits [Member] | ||
Components of net periodic benefit cost | ||
Service cost | 3,249 | 3,400 |
Interest cost | 21,489 | 22,240 |
Expected return on plan assets | (22,478) | (23,085) |
Amortization of: | ||
Net actuarial loss | 8,450 | 7,965 |
Prior service cost | 145 | 0 |
Net pension expense | 10,855 | 10,520 |
Union-administered plans | ||
Amortization of: | ||
Net pension expense | 2,502 | 2,322 |
Company-administered plans | ||
Amortization of: | ||
Net pension expense | 10,855 | 10,520 |
U.S. | ||
Amortization of: | ||
Net pension expense | 11,311 | 11,175 |
Non-U.S. | ||
Amortization of: | ||
Net pension expense | $ (456) | $ (655) |
OTHER ITEMS IMPACTING COMPARA47
OTHER ITEMS IMPACTING COMPARABILITY (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Other Income and Expenses [Abstract] | |
Other items | $ 2,205 |
SUPPLEMENTAL CASH FLOW INFORM48
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Supplemental cash flow information | ||
Interest paid | $ 31,441 | $ 34,421 |
Income taxes paid | 3,107 | 4,750 |
Changes in accounts payable related to purchases of revenue earning equipment | 74,766 | (77,486) |
Operating and revenue earning equipment acquired under capital leases | $ 1,607 | $ 240 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017USD ($)segment | Mar. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | segment | 3 | |
Total revenue | $ 1,748,163 | $ 1,629,672 |
Segment EBT | 79,617 | 105,621 |
Unallocated CSS | (10,213) | (10,045) |
Non-operating pension costs | (7,243) | (6,868) |
Other items | (2,205) | |
Earnings from continuing operations before income taxes | 59,956 | 88,708 |
Segment capital expenditures paid | 356,121 | 568,125 |
Unallocated CSS capital expenditures paid | 5,218 | 6,906 |
Capital expenditures paid | 361,339 | 575,031 |
FMS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 1,132,470 | 1,097,928 |
DTS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 266,674 | 244,842 |
SCS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 462,749 | 388,715 |
Intersegment Eliminations | ||
Segment Reporting Information [Line Items] | ||
Total revenue | (113,730) | (101,813) |
Segment EBT | (11,216) | (11,744) |
Segment capital expenditures paid | 0 | 0 |
Intersegment Eliminations | FMS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 113,730 | 101,813 |
Intersegment Eliminations | DTS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Intersegment Eliminations | SCS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 0 | 0 |
Operating Segments | FMS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 1,018,740 | 996,115 |
Segment EBT | 52,108 | 83,301 |
Segment capital expenditures paid | 344,355 | 560,285 |
Operating Segments | DTS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 266,674 | 244,842 |
Segment EBT | 11,279 | 14,268 |
Segment capital expenditures paid | 768 | 517 |
Operating Segments | SCS | ||
Segment Reporting Information [Line Items] | ||
Total revenue | 462,749 | 388,715 |
Segment EBT | 27,446 | 19,796 |
Segment capital expenditures paid | $ 10,998 | $ 7,323 |