Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 27, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | HUBG | |
Entity Registrant Name | Hub Group, Inc. | |
Entity Central Index Key | 940,942 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Class A Common Stock [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 33,719,269 | |
Class B Common Stock [Member] | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 662,296 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 26,753 | $ 28,557 |
Accounts receivable trade, net | 615,690 | 583,994 |
Accounts receivable other | 3,851 | 5,722 |
Prepaid taxes | 5,268 | 12,088 |
Prepaid expenses and other current assets | 15,763 | 25,697 |
TOTAL CURRENT ASSETS | 667,325 | 656,058 |
Restricted investments | 24,107 | 24,181 |
Property and equipment, net | 618,931 | 562,150 |
Other intangibles, net | 71,501 | 74,348 |
Goodwill, net | 348,106 | 348,661 |
Other assets | 3,534 | 5,543 |
TOTAL ASSETS | 1,733,504 | 1,670,941 |
CURRENT LIABILITIES: | ||
Accounts payable trade | 348,222 | 338,933 |
Accounts payable other | 12,418 | 12,268 |
Accrued payroll | 36,487 | 28,994 |
Accrued other | 78,598 | 59,305 |
Current portion of capital lease | 2,794 | 2,777 |
Current portion of long term debt | 86,740 | 77,266 |
TOTAL CURRENT LIABILITIES | 565,259 | 519,543 |
Long term debt | 179,444 | 214,808 |
Non-current liabilities | 39,083 | 37,927 |
Long term portion of capital lease | 6,196 | 7,696 |
Deferred taxes | 132,463 | 121,095 |
STOCKHOLDERS' EQUITY: | ||
Preferred stock, $.01 par value; 2,000,000 shares authorized; no shares issued or outstanding in 2018 and 2017 | ||
Additional paid-in capital | 168,614 | 173,011 |
Purchase price in excess of predecessor basis, net of tax benefit of $10,306 | (15,458) | (15,458) |
Retained earnings | 908,934 | 870,716 |
Accumulated other comprehensive loss | (190) | (194) |
Treasury stock; at cost, 7,507,623 shares in 2018 and 7,777,722 shares in 2017 | (251,260) | (258,622) |
TOTAL STOCKHOLDERS' EQUITY | 811,059 | 769,872 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 1,733,504 | 1,670,941 |
Class A Common Stock [Member] | ||
STOCKHOLDERS' EQUITY: | ||
Common stock | 412 | 412 |
Class B Common Stock [Member] | ||
STOCKHOLDERS' EQUITY: | ||
Common stock | $ 7 | $ 7 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Purchase price in excess of predecessor basis, tax benefit | $ 10,306 | |
Treasury stock, shares | 7,507,623 | 7,777,722 |
Class A Common Stock [Member] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 97,337,700 | 97,337,700 |
Common stock, shares issued | 41,224,792 | 41,224,792 |
Common stock, shares outstanding | 33,717,169 | 33,447,070 |
Class B Common Stock [Member] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 662,300 | 662,300 |
Common stock, shares issued | 662,296 | 662,296 |
Common stock, shares outstanding | 662,296 | 662,296 |
UNAUDITED CONSOLIDATED STATEMEN
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||||
Revenue | $ 1,179,093 | $ 923,596 | $ 2,275,064 | $ 1,816,352 |
Transportation costs | 1,042,903 | 822,279 | 2,016,083 | 1,613,450 |
Gross margin | 136,190 | 101,317 | 258,981 | 202,902 |
Costs and expenses: | ||||
Salaries and benefits | 58,092 | 45,038 | 114,099 | 88,217 |
Agent fees and commissions | 21,969 | 17,038 | 41,111 | 35,031 |
General and administrative | 20,216 | 20,114 | 40,720 | 40,938 |
Depreciation and amortization | 3,960 | 2,549 | 7,965 | 4,961 |
Total costs and expenses | 104,237 | 84,739 | 203,895 | 169,147 |
Operating income | 31,953 | 16,578 | 55,086 | 33,755 |
Other income (expense): | ||||
Interest expense | (2,187) | (1,032) | (4,291) | (2,130) |
Interest and dividend income | 22 | 200 | 44 | 330 |
Other, net | (189) | (244) | 194 | |
Total other expense | (2,354) | (832) | (4,491) | (1,606) |
Income before provision for income taxes | 29,599 | 15,746 | 50,595 | 32,149 |
Provision for income taxes | 7,548 | 6,204 | 12,377 | 12,273 |
Net income | 22,051 | 9,542 | 38,218 | 19,876 |
Other comprehensive income: | ||||
Foreign currency translation adjustments | (25) | 28 | 4 | 92 |
Total comprehensive income | $ 22,026 | $ 9,570 | $ 38,222 | $ 19,968 |
Basic earnings per common share | $ 0.66 | $ 0.29 | $ 1.14 | $ 0.60 |
Diluted earnings per common share | $ 0.66 | $ 0.29 | $ 1.14 | $ 0.60 |
Basic weighted average number of shares outstanding | 33,389 | 33,220 | 33,382 | 33,213 |
Diluted weighted average number of shares outstanding | 33,562 | 33,262 | 33,520 | 33,318 |
UNAUDITED CONSOLIDATED STATEME5
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net Income | $ 38,218 | $ 19,876 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 38,251 | 25,288 |
Deferred taxes | 11,767 | 7,713 |
Compensation expense related to share-based compensation plans | 6,982 | 4,972 |
Contingent consideration adjustment | (3,571) | |
(Gain) loss on sale of assets | (90) | 307 |
Changes in operating assets and liabilities: | ||
Restricted investments | 74 | (2,408) |
Accounts receivable, net | (29,748) | 26,240 |
Prepaid taxes | 6,820 | (3,352) |
Prepaid expenses and other current assets | 9,935 | 4,493 |
Other assets | 1,869 | (2,653) |
Accounts payable | 9,878 | 307 |
Accrued expenses | 4,857 | (18,013) |
Non-current liabilities | 2,382 | 368 |
Net cash provided by operating activities | 97,624 | 63,138 |
Cash flows from investing activities: | ||
Proceeds from sale of equipment | 1,234 | 2,356 |
Purchases of property and equipment | (69,261) | (29,593) |
Net cash used in investing activities | (68,027) | (27,237) |
Cash flows from financing activities: | ||
Proceeds from issuance of debt | 58,161 | 16,149 |
Repayments of long term debt | (84,051) | (23,118) |
Stock tendered for payments of withholding taxes | (4,017) | (3,293) |
Capital lease payments | (1,483) | (1,399) |
Net cash used in financing activities | (31,390) | (11,661) |
Effect of exchange rate changes on cash and cash equivalents | (11) | 95 |
Net (decrease) increase in cash and cash equivalents | (1,804) | 24,335 |
Cash and cash equivalents beginning of the period | 28,557 | 127,404 |
Cash and cash equivalents end of the period | 26,753 | 151,739 |
Supplemental disclosures of cash paid for: | ||
Interest | 4,182 | 2,176 |
Income taxes | $ 752 | $ 10,743 |
Interim Financial Statements
Interim Financial Statements | 6 Months Ended |
Jun. 30, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Interim Financial Statements | NOTE 1. Interim Financial Statements Our accompanying unaudited consolidated financial statements of Hub Group, Inc. (“we”, “us”, “our” or “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements have been omitted pursuant to those rules and regulations. However, we believe that the disclosures contained herein are adequate to make the information presented not misleading. The financial statements reflect, in our opinion, all material adjustments (which include only normal recurring adjustments) necessary to fairly present our financial position as of June 30, 2018 and results of operations for the six months ended June 30, 2018 and 2017. Certain amounts in prior periods have been reclassified to conform with current period presentation. These unaudited consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017. Results of operations in interim periods are not necessarily indicative of results to be expected for a full year due partially to seasonality. Accounting Standards Update. On January 1, 2018 we adopted the Accounting Standards Codification (ASC) topic 606, Revenue from Contracts with Customers. Under this new standard our significant accounting policy for revenue is as follows: Revenue : Revenue is recognized at the time (1) persuasive evidence of an arrangement exists, (2) services have been rendered, (3) the sales price is fixed and determinable and (4) collectability is reasonably assured. We generally recognize revenue over time because of continuous transfer of control to the customer. Since control is transferred over time, revenue and related transportation costs are recognized based on relative transit time, which is based on the extent of progress towards completion of the related performance obligation. We enter into contracts that can include various combinations of services, which are capable of being distinct and accounted for as separate performance obligations. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Further, in most cases, we report our revenue on a gross basis because we are the primary obligor as we are responsible for providing the service desired by the customer. Our customers view us as responsible for fulfillment including the acceptability of the service. Service requirements may include, for example, on-time delivery, handling freight loss and damage claims, setting up appointments for pick-up and delivery and tracing shipments in transit. We have discretion in setting sales prices and as a result, the amount we earn varies. In addition, we have the discretion to select our vendors from multiple suppliers for the services ordered by our customers. These factors, discretion in setting prices and discretion in selecting vendors, further support reporting revenue on a gross basis for most of our revenue. The Company capitalizes commissions incurred in connection with obtaining a contract. The Company capitalized commissions associated with dedicated services of $0.4 million at June 30, 2018. Capitalized commission fees are amortized based on the transfer of services to which the assets relate and are included in selling, general and administrative expenses. In 2018, the amount of amortization was approximately $30,000. Costs incurred to fulfill an intermodal, truck brokerage or logistics contract are expensed as incurred according to the practical expedient that allows contract acquisition costs to be recognized immediately if the deferral period is one year or less. The Company applied Topic 606 retrospectively using the practical expedient in paragraph 606-10-65-1(f)(3), under which the Company does not disclose the amount of consideration allocated to the remaining performance obligations or an explanation of when the Company expects to recognize that amount as revenue for all reporting periods presented before January 1, 2018. We do not generally have a remaining performance obligation due to revenue generally being recognized using relevant transit time. We only had one significant accounting policy change that is disclosed below. T axes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by Hub Group from a customer |
Acquisition
Acquisition | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisition | NOTE 2. Acquisition Hub Group Trucking (HGT), a wholly owned subsidiary of Hub Group, Inc., acquired all of the outstanding equity interests of Estenson Logistics, LLC (“Estenson”) on July 1, 2017 (the “Estenson Acquisition”). Estenson is now our wholly owned subsidiary, operating under the name Hub Group Dedicated (“HGD”). As a result of the Estenson Acquisition, HGT acquired substantially all of the assets of Estenson, which include tractors and trailers, as well as assumed certain liabilities, including equipment debt. HGD is included in the Hub segment. The following unaudited pro forma consolidated results of operations for 2017 assume that the acquisition of Estenson was completed as of January 1, 2017 (in thousands, except for per share amounts): Three Months Six Months Ended Ended June 30, 2017 June 30, 2017 Revenue $ 983,029 $ 1,930,373 Net income $ 12,450 $ 24,053 Earnings per share Basic $ 0.38 $ 0.73 Diluted $ 0.38 $ 0.72 The unaudited pro forma consolidated results for the three and six month periods were prepared using the acquisition method of accounting and are based on the historical financial information of Hub Group and HGD. The historical financial information has been adjusted to give effect to the pro forma adjustments that are: (i) directly attributable to the acquisition, (ii) factually supportable and (iii) expected to have a continuing impact on the combined results. The unaudited pro forma consolidated results are not necessarily indicative of what our consolidated results of operations actually would have been had we completed the acquisition on January 1, 2017. |
Business Segments
Business Segments | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Business Segments | NOTE 3 . Business Segments We report two distinct business segments. The first segment is Mode, which includes the Mode Transportation, LLC (“Mode LLC”) business only. The second segment is Hub, which is all business other than Mode. Hub offers comprehensive multimodal solutions including intermodal, truck brokerage, logistics and dedicated services. Our employees operate the freight through a network of operating centers and terminals located in the United States, Canada and Mexico. Each operating center is strategically located in a market with a significant concentration of shipping customers and one or more railheads. Hub has full time employees located throughout the United States, Canada and Mexico. Mode LLC has Independent Business Owners (“IBOs”) who sell and operate the business throughout North America, as well as sales only agents. Mode LLC also has a corporate offices in Dallas, TX, a temperature protected services division, Temstar, located in Oak Brook, IL and a corporate office in Memphis, TN. Mode LLC markets and operates its freight transportation services, consisting of intermodal, truck brokerage and logistics, primarily through agents who enter into contractual arrangements with Mode LLC. Our transportation services for both Hub and Mode segments can be broadly placed into the following categories: Intermodal. As an intermodal provider, we arrange for the movement of our customers’ freight in containers and trailers, typically over long distances of 750 miles or more. We contract with railroads to provide transportation for the long-haul portion of the shipment and with local trucking companies, known as “drayage companies,” for pickup and delivery. As part of our intermodal services, we negotiate rail and drayage rates, electronically track shipments in transit, consolidate billing and handle claims for freight loss or damage on behalf of our customers. Truck Brokerage (Highway Services). We are one of the largest truck brokers in the United States, providing customers with a highway service option for their transportation needs. We match the customers’ needs with carriers’ capacity to provide the most effective service and price combination. We have contracts with a substantial base of carriers allowing us to meet the varied needs of our customers. As part of the truck brokerage services, we negotiate rates, track shipments in transit and handle claims for freight loss and damage on behalf of our customers. Logistics and Other Services . Hub’s logistics business operates under the name of Unyson Logistics. Unyson Logistics is comprised of a network of logistics professionals dedicated to developing, implementing and operating customized logistics solutions for customers. Unyson Logistics offers a wide range of transportation management services and technology solutions including shipment optimization, load consolidation, mode selection, carrier management, load planning and execution and web-based shipment visibility. Unyson Logistics operates throughout North America, providing services through its main operating location in St. Louis with additional support locations in the Boston and Chicago metro areas. In addition, certain Mode LLC agents also provide logistics services. Our multi-modal transportation capabilities for both the Hub and Mode segments include small parcel, heavyweight, expedited, less-than-truckload, truckload, intermodal, railcar and international shipping. Dedicated: Our dedicated service line, HGD, contracts with customers who wish to outsource a portion of their transportation needs. We offer a dedicated fleet of equipment and drivers to each customer, as well as the management and infrastructure to operate according to the customer’s high service expectations. The following is a summary of operating results and certain other financial data for our business segments (in thousands): Three Months Three Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Revenue $ 888,238 $ 314,078 $ (23,223 ) $ 1,179,093 $ 704,344 $ 242,998 $ (23,746 ) $ 923,596 Transportation costs 788,087 278,039 (23,223 ) 1,042,903 631,787 214,238 (23,746 ) 822,279 Gross margin 100,151 36,039 - 136,190 72,557 28,760 - 101,317 Costs and expenses: Salaries and benefits 53,839 4,253 - 58,092 41,569 3,469 - 45,038 Agent fees and commissions 11 21,958 - 21,969 14 17,024 - 17,038 General and administrative 17,768 2,448 - 20,216 18,331 1,783 - 20,114 Depreciation and amortization 3,719 241 - 3,960 2,249 300 - 2,549 Total costs and expenses 75,337 28,900 - 104,237 62,163 22,576 - 84,739 Operating income $ 24,814 $ 7,139 $ - $ 31,953 $ 10,395 $ 6,184 $ - $ 16,578 Capital Expenditures $ 46,337 $ 745 $ - $ 47,082 $ 22,937 $ 31 $ - $ 22,968 Six Months Six Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Revenue $ 1,719,823 $ 601,977 $ (46,736 ) $ 2,275,064 $ 1,380,824 $ 484,832 $ (49,304 ) $ 1,816,352 Transportation costs 1,529,297 533,522 (46,736 ) 2,016,083 1,236,462 426,292 (49,304 ) 1,613,450 Gross margin 190,526 68,455 - 258,981 144,362 58,540 - 202,902 Costs and expenses: Salaries and benefits 105,909 8,190 - 114,099 81,164 7,053 - 88,217 Agent fees and commissions 25 41,086 - 41,111 31 35,000 - 35,031 General and administrative 36,170 4,550 - 40,720 36,810 4,128 - 40,938 Depreciation and amortization 7,478 487 - 7,965 4,357 604 - 4,961 Total costs and expenses 149,582 54,313 - 203,895 122,362 46,785 - 169,147 Operating income $ 40,944 $ 14,142 $ - $ 55,086 $ 22,000 $ 11,755 $ - $ 33,755 Capital Expenditures $ 67,874 $ 1,387 $ - $ 69,261 $ 29,562 $ 31 $ - $ 29,593 As of June 30, 2018 As of December 31, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Total assets $ 1,513,130 $ 227,425 $ (7,051 ) $ 1,733,504 $ 1,470,792 $ 210,088 $ (9,939 ) $ 1,670,941 Goodwill $ 318,717 $ 29,389 $ - $ 348,106 $ 319,272 $ 29,389 $ - $ 348,661 On January 1, 2018, the Company adopted ASC Topic 606 using the modified retrospective method applied to those contracts that were not completed as of January 1, 2018. Segment revenues were not significantly impacted under ASC Topic 606. The tables below represent disaggregated revenue from contracts with customers. The following tables summarize our revenue by segment and business line (in thousands) for the quarter ended June 30: Three Months Three Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Intermodal $ 526,028 $ 141,221 $ (6,559 ) $ 660,690 $ 451,420 $ 112,089 $ (12,866 ) $ 550,643 Truck brokerage 114,936 103,168 (84 ) 218,020 104,289 82,869 (310 ) 186,848 Logistics 173,421 69,689 (16,580 ) 226,530 148,635 48,040 (10,570 ) 186,105 Dedicated 73,853 - - 73,853 - - - - Total revenue $ 888,238 $ 314,078 $ (23,223 ) $ 1,179,093 $ 704,344 $ 242,998 $ (23,746 ) $ 923,596 The following tables summarize our revenue by segment and business line (in thousands) for the six months ended June 30: Six Months Six Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Intermodal $ 1,008,522 $ 270,995 $ (17,829 ) $ 1,261,688 $ 875,843 $ 234,269 $ (28,103 ) $ 1,082,009 Truck brokerage 234,955 203,889 (442 ) 438,402 210,473 161,031 (695 ) 370,809 Logistics 342,098 127,093 (28,450 ) 440,741 294,508 89,532 (20,506 ) 363,534 Dedicated 134,248 - (15 ) 134,233 - - - - Total revenue $ 1,719,823 $ 601,977 $ (46,736 ) $ 2,275,064 $ 1,380,824 $ 484,832 $ (49,304 ) $ 1,816,352 |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | NOTE 4 . Earnings Per Share The following is a reconciliation of our earnings per share (in thousands, except for per share data): Three Months Ended, June 30, Six Months Ended, June 30, 2018 2017 2018 2017 Net income for basic and diluted earnings per share $ 22,051 $ 9,542 $ 38,218 $ 19,876 Weighted average shares outstanding - basic 33,389 33,220 33,382 33,213 Dilutive effect of stock options and restricted stock 173 42 138 105 Weighted average shares outstanding - diluted 33,562 33,262 33,520 33,318 Earnings per share - basic $ 0.66 $ 0.29 $ 1.14 $ 0.60 Earnings per share - diluted $ 0.66 $ 0.29 $ 1.14 $ 0.60 |
Fair Value Measurement
Fair Value Measurement | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | NOTE 5 . Fair Value Measurement The carrying value of cash, accounts receivable and accounts payable approximated fair value as of June 30, 2018 and December 31, 2017. At June 30, 2018 and December 31, 2017 the fair value of the Company’s fixed-rate borrowings was $3.6 million and $2.4 million less than the historical carrying value of $266.2 million and $247.1 million. The fair value of the fixed-rate borrowings was estimated using an income approach based on current interest rates available to the Company for borrowings on similar terms and maturities. We consider as cash equivalents all highly liquid instruments with an original maturity of three months or less. As of June 30, 2018 and December 31, 2017, our cash and temporary investments were with high quality financial institutions in Demand Deposit Accounts (DDAs) and Savings Accounts. Restricted investments, as of June 30, 2018 of $24.1 million and December 31, 2017 of $24.2 million, consisted of mutual funds which are reported at fair value and are related to the liabilities of our nonqualified deferred compensation plan. The fair value of the contingent consideration related to the 2017 acquisition of Estenson was $1.1 million at June 30, 2018. This valuation was based on significant inputs that are not observable in the market, which are referred to as Level 3 inputs. Key assumptions include the likelihood of the acquired business achieving target levels of EBITDA using a probability-weighted expected return method (“PWERM”). The following table sets forth a reconciliation of changes in the fair value of the contingent consideration: Balance at December 31, 2017 $ 4,703 Change in fair value (1) (3,571 ) Balance at June 30, 2018 $ 1,132 (1) We recorded an adjustment to the contingent consideration liability in the second quarter of 2018, resulting in an increase in income from operations. The income was recorded under “General and Administrative” in the Consolidated Statement of Income. The adjustment was the result of a change in the fair value of the contingent liability, which reflected two year EBITDA targets established prior to the close of the acquisition. Our assets and liabilities measured at fair value are based on valuation techniques which consider prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. These valuation methods are based on either quoted market prices (Level 1) inputs, other than quoted prices in active markets, that are observable either directly or indirectly (Level 2), or unobservable inputs (Level 3). Cash, accounts receivable and accounts payable are defined as “Level 1”, long term debt is defined as “Level 2”, and the Estenson contingent consideration is defined as “Level 3” of the fair value hierarchy in the Fair Value Measurements and Disclosures Topic of the Codification. |
Long-Term Debt and Financing Ar
Long-Term Debt and Financing Arrangements | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Financing Arrangements | NOTE 6 . Long-Term Debt and Financing Arrangements At June 30, 2018, we were authorized to borrow up to $350 million under a revolving line of credit. As of June 30, 2018, we had no borrowings under our bank revolving line of credit and our unused and available borrowings were $327.0 million. As of December 31, 2017, we had $45.0 million of borrowings under our bank revolving line of credit and our unused and available borrowings were $284.9 million. We were in compliance with our debt covenants as of June 30, 2018. We have standby letters of credit that expire at various dates in 2018 and 2019. As of June 30, 2018, our letters of credit were $23.0 million. We have entered into various Equipment Notes (“Notes”) for the purchase of tractors, trailers and containers. The Notes are secured by the underlying equipment financed in the agreements. June 30, December 31, 2018 2017 (in thousands except principal and interest payments) Revolving line of credit $ - $ 45,000 Secured Equipment Notes due on various dates in 2024 with monthly principal and interest payments between $403 and $83,000 commencing on various dates in 2017; interest is paid monthly at a fixed annual rate between 2.85% and 3.41% 12,691 13,586 Secured Equipment Notes due on various dates in 2023 with monthly principal and interest payments between $669 and $341,341 commencing on various dates in 2016, 2017 and 2018; interest is paid monthly at a fixed annual rate between 2.23% and 3.91% 91,077 36,981 Secured Equipment Notes due on various dates in 2022 with monthly principal and interest payments between $3,030 and $254,190 commencing on various dates from 2015 to 2017; interest is paid monthly at a fixed annual rate of between 2.16% and 2.87% 27,435 30,301 Secured Equipment Notes due on various dates in 2021 with monthly principal and interest payments between $1,940 and $352,655 commencing on various dates from 2014 to 2017; interest is paid monthly at a fixed annual rate between 2.04% and 2.96% 66,863 76,885 Secured Equipment Notes due on various dates in 2020 with monthly principal and interest payments between $3,614 and $398,496 commencing on various dates from 2013 to 2016; interest is paid monthly at a fixed annual rate between 1.72% and 2.78% 42,960 50,737 Secured Equipment Notes due on various dates in 2019 with monthly principal and interest payments between $1,594 and $325,050 commencing on various dates from 2013 to 2015; interest is paid monthly at a fixed annual rate between 1.79% and 2.62% 25,158 36,178 Secured Equipment Notes due on various dates in 2018 with monthly principal and interest payments between $6,480 and $163,428 commencing on various dates in 2013 and 2014; interest is paid monthly at a fixed annual rate between 2.05% and 2.7% - 2,406 266,184 292,074 Less current portion (86,740 ) (77,266 ) Total long-term debt $ 179,444 $ 214,808 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 7 . Commitments and Contingencies In November 2016, we committed to acquire 4,000 Since January 1, 2018 we have committed to acquire 869 tractors for $107.2 million. As of June 30, 2018 we received 380 tractors, which are being financed with debt, and we expect to receive the remaining 489 tractors from July to December of 2018. We expect to finance these tractors with debt. Since January 1, 2018 we have committed to acquire 760 trailers for $24.2 million. As of June 30, 2018 we received 217 trailers, which will be financed with debt, and we expect to receive the remaining 543 trailers from July to December of 2018. We expect to finance these trailers with debt. |
Legal Matters
Legal Matters | 6 Months Ended |
Jun. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Legal Matters | NOTE 8 . Legal Matters Robles On January 25, 2013, a complaint was filed in the U.S. District Court for the Eastern District of California (Sacramento Division) by Salvador Robles against our subsidiary Hub Group Trucking, Inc (“HGT”). The action is brought on behalf of a class comprised of present and former California-based truck drivers for HGT who were classified as independent contractors, from January 2009 to August 2014. It alleges HGT has misclassified such drivers as independent contractors and that such drivers were employees. It asserts various violations of the California Labor Code and claims that HGT has engaged in unfair competition practices. The complaint seeks, among other things, declaratory and injunctive relief, monetary damages and attorney’s fees. In May 2013, the complaint was amended to add similar claims based on Mr. Robles’ status as an employed company driver. These additional claims are only on behalf of Mr. Robles and not a putative class. The Company believes that the California independent contractor truck drivers were properly classified as independent contractors at all times. Nevertheless, because lawsuits are expensive, time-consuming and could interrupt our business operations, HGT decided to make settlement offers to individual drivers with respect to the claims alleged in this lawsuit, without admitting liability. As of June 30, 2018, 96% of the California drivers have accepted the settlement offers. In late 2014, HGT decided to convert its model from independent contractors to employee drivers in California (the “Conversion”). In early 2016, HGT closed its operations in Southern California. On April 3, 2015, the Robles case was transferred to the U.S. District Court for the Western District of Tennessee (Western Division) in Memphis. In May 2015, the plaintiffs in the Robles case filed a Second Amended Complaint (“SAC”) which names 334 current and former Hub Group Trucking drivers as “interested putative class members.” In addition to reasserting their existing claims, the SAC includes claims post-Conversion, added two new plaintiffs and seeks a judicial declaration that the settlement agreements are unenforceable. In June 2015, Hub Group Trucking filed a motion to dismiss the SAC and on July 19, 2016, Hub Group Trucking’s motion to dismiss was granted in part, and denied in part, by the District Court. The motion to dismiss was granted for the claims of all purported class members who have signed settlement agreements and on plaintiffs’ claims based on quantum merit and it was denied with respect to federal preemption and choice of law. On August 11, 2016, Plaintiffs filed a motion to clarify whether the Court’s dismissal of the claims of all purported class members who signed settlement agreements was with or without prejudice and, if the dismissal was with prejudice, Plaintiffs moved the Court to revise and reconsider the order. On July 2, 2018, the Court denied the Plaintiffs’ Motion for Clarification or Reconsideration and stated that the dismissal of the claims of all purported class members who signed settlement agreements was with prejudice. Adame On August 5, 2015, the Plaintiffs’ law firm in the Robles case filed a lawsuit in state court in San Bernardino County, California on behalf of 63 named Plaintiffs against Hub Group Trucking and five Company employees. The lawsuit alleges claims similar to those being made in Robles and seeks monetary penalties under the Private Attorneys General Act. Of the 63 named Plaintiffs, at least 58 of them previously accepted the settlement offers referenced above. On October 29, 2015, Defendants filed a notice of removal to move the case from state court in San Bernardino to federal court in the Central District of California. On November 19, 2015, Plaintiffs filed a motion to remand the case back to state court, claiming that the federal court lacks jurisdiction over the case because there is not complete diversity of citizenship between the parties and the amount in controversy threshold is not satisfied. The court granted Plaintiffs’ motion to remand to the state court in San Bernardino County on April 7, 2016. On July 11, 2016, Defendants filed dismissal papers in state court, asking the court to dismiss Plaintiffs’ suit for various reasons, including that the agreement between HGT and its former California owner operators requires that this action be brought in Memphis, Tennessee, or stay the action pending the outcome of Robles. Defendants also asked the court to dismiss the individual defendants because PAGA’s language does not allow for individual liability. During a hearing on October 5, 2016, the judge issued an oral tentative ruling stating that the choice of forum provision was unenforceable. On February 17, 2017, with the stipulation of the parties, the Court entered an order dismissing, without prejudice, all of the individual Defendants and accepting the parties’ agreement that jurisdiction and venue are proper in the San Bernardino Superior Court and that Defendants will not seek to remove the case to federal district court. On April 12, 2017, the Court denied Defendant’s motion to dismiss based on insufficiency of the PAGA letter notice. On October 19, 2017, Plaintiffs filed an amended complaint, dismissing the previously named individuals as Defendants. On December 4, 2017, Defendants filed an Answer to Plaintiffs’ First Amended Complaint and a Memorandum of Points and Authorities in Support of their Motion for Judgment on the Pleadings arguing that judgement should be entered for Defendants because Plaintiffs’ claims are preempted by the Federal Truth-In-Leasing regulations. On January 31, 2018, a hearing was held on the motion to dismiss, and on February 1, 2018, the motion was denied. On March 27, 2018, Defendants filed a petition for a writ of mandate with the Court of Appeals. On June 12, 2018, the Court of Appeals denied the petition. On June 21, 2018, Defendants filed a petition for review with the California Supreme Court. There is no timetable for when the Supreme Court will decide if it will review the petition. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 9. Income Taxes For the quarter ending June 30, 2018, the provision for income taxes increased to $7.5 million from $6.2 million in 2017, while the effective tax rate decreased to 25.5% in 2018 from 39.4% in 2017. For the six months ending June 30, 2018, the provision for income taxes increased to $12.4 million from $12.3 million in 2017, while the effective tax rate decreased to 24.5% from 38.2%. The provision for income taxes increased primarily due to higher pre-tax income in 2018, while the 2018 effective tax rate was lower primarily due to the enactment of the U.S. Tax Cuts and Jobs Act (the “Act”) on December 22, 2017, which reduced the U.S. federal corporate tax rate from 35% to 21%. We expect our effective tax rate for 2018 will range from 24.5% to 25.5%. Due to the complexities involved in accounting for the enactment of the Act, the SEC Staff Accounting Bulletin No. 118 (“SAB No. 118”) allows for a one-year period, from the date of enactment, to complete the related income tax accounting for the Act and allows for the use of provisional amounts until that accounting is complete. The Company recorded provisional amounts in earnings for the year ended December 31, 2017 as certain deferred tax assets and liabilities were remeasured based on the rates at which they are expected to reverse in the future, which is generally 21%. However, we are still analyzing aspects of the Act and refining our calculations, which could potentially affect the measurement of these balances or potentially give rise to new deferred tax amounts until the federal income tax return for 2017 is filed later this year. |
New Accounting Pronouncements
New Accounting Pronouncements | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Changes And Error Corrections [Abstract] | |
New Accounting Pronouncements | NOTE 10 . New Accounting Pronouncements In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business. This ASU clarifies the definition of a business when evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. This standard was adopted on January 1, 2018. Any impact would apply to future acquisitions. In 2016, the FASB issued new guidance that requires credit losses on financial assets measured at amortized cost basis to be presented at the net amount expected to be collected, not based on incurred losses . In February 2016, the FASB issued ASU No. 2016-02, Leases, which requires lessees to recognize a right-to-use asset and a lease obligation for all leases. The new standard will become effective beginning with the first quarter of 2019, but early adoption is permitted. We plan to adopt this standard January 1, 2019, as required. The standard also provides an additional transition method to assist entities with the implementation. Entities that elect this option would adopt the new standard using a modified retrospective transition method, but they would recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption rather than in the earliest period presented. We will elect to apply a package of practical expedients and will not reassess at the date of initial adoption (1) whether any expired or existing contracts are or contain leases, (2) the lease classification for any expired or existing leases, or (3) initial direct costs for existing leases. Lessees can also make an accounting policy election to We will elect th is short-term lease policy. |
Interim Financial Statements (P
Interim Financial Statements (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Revenue | Revenue : Revenue is recognized at the time (1) persuasive evidence of an arrangement exists, (2) services have been rendered, (3) the sales price is fixed and determinable and (4) collectability is reasonably assured. We generally recognize revenue over time because of continuous transfer of control to the customer. Since control is transferred over time, revenue and related transportation costs are recognized based on relative transit time, which is based on the extent of progress towards completion of the related performance obligation. We enter into contracts that can include various combinations of services, which are capable of being distinct and accounted for as separate performance obligations. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Further, in most cases, we report our revenue on a gross basis because we are the primary obligor as we are responsible for providing the service desired by the customer. Our customers view us as responsible for fulfillment including the acceptability of the service. Service requirements may include, for example, on-time delivery, handling freight loss and damage claims, setting up appointments for pick-up and delivery and tracing shipments in transit. We have discretion in setting sales prices and as a result, the amount we earn varies. In addition, we have the discretion to select our vendors from multiple suppliers for the services ordered by our customers. These factors, discretion in setting prices and discretion in selecting vendors, further support reporting revenue on a gross basis for most of our revenue. The Company capitalizes commissions incurred in connection with obtaining a contract. The Company capitalized commissions associated with dedicated services of $0.4 million at June 30, 2018. Capitalized commission fees are amortized based on the transfer of services to which the assets relate and are included in selling, general and administrative expenses. In 2018, the amount of amortization was approximately $30,000. Costs incurred to fulfill an intermodal, truck brokerage or logistics contract are expensed as incurred according to the practical expedient that allows contract acquisition costs to be recognized immediately if the deferral period is one year or less. The Company applied Topic 606 retrospectively using the practical expedient in paragraph 606-10-65-1(f)(3), under which the Company does not disclose the amount of consideration allocated to the remaining performance obligations or an explanation of when the Company expects to recognize that amount as revenue for all reporting periods presented before January 1, 2018. We do not generally have a remaining performance obligation due to revenue generally being recognized using relevant transit time. We only had one significant accounting policy change that is disclosed below. T axes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by Hub Group from a customer |
Acquisition (Tables)
Acquisition (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Estenson Logistics, LLC [Member] | |
Unaudited Pro forma Consolidated Results of Operations | The following unaudited pro forma consolidated results of operations for 2017 assume that the acquisition of Estenson was completed as of January 1, 2017 (in thousands, except for per share amounts): Three Months Six Months Ended Ended June 30, 2017 June 30, 2017 Revenue $ 983,029 $ 1,930,373 Net income $ 12,450 $ 24,053 Earnings per share Basic $ 0.38 $ 0.73 Diluted $ 0.38 $ 0.72 |
Business Segments (Tables)
Business Segments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Summary of Operating Results and Certain Other Financial Data | The following is a summary of operating results and certain other financial data for our business segments (in thousands): Three Months Three Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Revenue $ 888,238 $ 314,078 $ (23,223 ) $ 1,179,093 $ 704,344 $ 242,998 $ (23,746 ) $ 923,596 Transportation costs 788,087 278,039 (23,223 ) 1,042,903 631,787 214,238 (23,746 ) 822,279 Gross margin 100,151 36,039 - 136,190 72,557 28,760 - 101,317 Costs and expenses: Salaries and benefits 53,839 4,253 - 58,092 41,569 3,469 - 45,038 Agent fees and commissions 11 21,958 - 21,969 14 17,024 - 17,038 General and administrative 17,768 2,448 - 20,216 18,331 1,783 - 20,114 Depreciation and amortization 3,719 241 - 3,960 2,249 300 - 2,549 Total costs and expenses 75,337 28,900 - 104,237 62,163 22,576 - 84,739 Operating income $ 24,814 $ 7,139 $ - $ 31,953 $ 10,395 $ 6,184 $ - $ 16,578 Capital Expenditures $ 46,337 $ 745 $ - $ 47,082 $ 22,937 $ 31 $ - $ 22,968 Six Months Six Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Revenue $ 1,719,823 $ 601,977 $ (46,736 ) $ 2,275,064 $ 1,380,824 $ 484,832 $ (49,304 ) $ 1,816,352 Transportation costs 1,529,297 533,522 (46,736 ) 2,016,083 1,236,462 426,292 (49,304 ) 1,613,450 Gross margin 190,526 68,455 - 258,981 144,362 58,540 - 202,902 Costs and expenses: Salaries and benefits 105,909 8,190 - 114,099 81,164 7,053 - 88,217 Agent fees and commissions 25 41,086 - 41,111 31 35,000 - 35,031 General and administrative 36,170 4,550 - 40,720 36,810 4,128 - 40,938 Depreciation and amortization 7,478 487 - 7,965 4,357 604 - 4,961 Total costs and expenses 149,582 54,313 - 203,895 122,362 46,785 - 169,147 Operating income $ 40,944 $ 14,142 $ - $ 55,086 $ 22,000 $ 11,755 $ - $ 33,755 Capital Expenditures $ 67,874 $ 1,387 $ - $ 69,261 $ 29,562 $ 31 $ - $ 29,593 |
Schedule of Assets | As of June 30, 2018 As of December 31, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Total assets $ 1,513,130 $ 227,425 $ (7,051 ) $ 1,733,504 $ 1,470,792 $ 210,088 $ (9,939 ) $ 1,670,941 Goodwill $ 318,717 $ 29,389 $ - $ 348,106 $ 319,272 $ 29,389 $ - $ 348,661 |
Summary of Revenue by Segment and Business Line | The following tables summarize our revenue by segment and business line (in thousands) for the quarter ended June 30: Three Months Three Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Intermodal $ 526,028 $ 141,221 $ (6,559 ) $ 660,690 $ 451,420 $ 112,089 $ (12,866 ) $ 550,643 Truck brokerage 114,936 103,168 (84 ) 218,020 104,289 82,869 (310 ) 186,848 Logistics 173,421 69,689 (16,580 ) 226,530 148,635 48,040 (10,570 ) 186,105 Dedicated 73,853 - - 73,853 - - - - Total revenue $ 888,238 $ 314,078 $ (23,223 ) $ 1,179,093 $ 704,344 $ 242,998 $ (23,746 ) $ 923,596 The following tables summarize our revenue by segment and business line (in thousands) for the six months ended June 30: Six Months Six Months Ended June 30, 2018 Ended June 30, 2017 Inter- Hub Inter- Hub Segment Group Segment Group Hub Mode Elims Total Hub Mode Elims Total Intermodal $ 1,008,522 $ 270,995 $ (17,829 ) $ 1,261,688 $ 875,843 $ 234,269 $ (28,103 ) $ 1,082,009 Truck brokerage 234,955 203,889 (442 ) 438,402 210,473 161,031 (695 ) 370,809 Logistics 342,098 127,093 (28,450 ) 440,741 294,508 89,532 (20,506 ) 363,534 Dedicated 134,248 - (15 ) 134,233 - - - - Total revenue $ 1,719,823 $ 601,977 $ (46,736 ) $ 2,275,064 $ 1,380,824 $ 484,832 $ (49,304 ) $ 1,816,352 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Reconciliation of Earnings Per Share | The following is a reconciliation of our earnings per share (in thousands, except for per share data): Three Months Ended, June 30, Six Months Ended, June 30, 2018 2017 2018 2017 Net income for basic and diluted earnings per share $ 22,051 $ 9,542 $ 38,218 $ 19,876 Weighted average shares outstanding - basic 33,389 33,220 33,382 33,213 Dilutive effect of stock options and restricted stock 173 42 138 105 Weighted average shares outstanding - diluted 33,562 33,262 33,520 33,318 Earnings per share - basic $ 0.66 $ 0.29 $ 1.14 $ 0.60 Earnings per share - diluted $ 0.66 $ 0.29 $ 1.14 $ 0.60 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Reconciliation of Changes in Fair value of Contingent Consideration | The following table sets forth a reconciliation of changes in the fair value of the contingent consideration: Balance at December 31, 2017 $ 4,703 Change in fair value (1) (3,571 ) Balance at June 30, 2018 $ 1,132 (1) We recorded an adjustment to the contingent consideration liability in the second quarter of 2018, resulting in an increase in income from operations. The income was recorded under “General and Administrative” in the Consolidated Statement of Income. The adjustment was the result of a change in the fair value of the contingent liability, which reflected two year EBITDA targets established prior to the close of the acquisition. |
Long-Term Debt and Financing 21
Long-Term Debt and Financing Arrangements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Outstanding Debt | June 30, December 31, 2018 2017 (in thousands except principal and interest payments) Revolving line of credit $ - $ 45,000 Secured Equipment Notes due on various dates in 2024 with monthly principal and interest payments between $403 and $83,000 commencing on various dates in 2017; interest is paid monthly at a fixed annual rate between 2.85% and 3.41% 12,691 13,586 Secured Equipment Notes due on various dates in 2023 with monthly principal and interest payments between $669 and $341,341 commencing on various dates in 2016, 2017 and 2018; interest is paid monthly at a fixed annual rate between 2.23% and 3.91% 91,077 36,981 Secured Equipment Notes due on various dates in 2022 with monthly principal and interest payments between $3,030 and $254,190 commencing on various dates from 2015 to 2017; interest is paid monthly at a fixed annual rate of between 2.16% and 2.87% 27,435 30,301 Secured Equipment Notes due on various dates in 2021 with monthly principal and interest payments between $1,940 and $352,655 commencing on various dates from 2014 to 2017; interest is paid monthly at a fixed annual rate between 2.04% and 2.96% 66,863 76,885 Secured Equipment Notes due on various dates in 2020 with monthly principal and interest payments between $3,614 and $398,496 commencing on various dates from 2013 to 2016; interest is paid monthly at a fixed annual rate between 1.72% and 2.78% 42,960 50,737 Secured Equipment Notes due on various dates in 2019 with monthly principal and interest payments between $1,594 and $325,050 commencing on various dates from 2013 to 2015; interest is paid monthly at a fixed annual rate between 1.79% and 2.62% 25,158 36,178 Secured Equipment Notes due on various dates in 2018 with monthly principal and interest payments between $6,480 and $163,428 commencing on various dates in 2013 and 2014; interest is paid monthly at a fixed annual rate between 2.05% and 2.7% - 2,406 266,184 292,074 Less current portion (86,740 ) (77,266 ) Total long-term debt $ 179,444 $ 214,808 |
Interim Financial Statements -
Interim Financial Statements - Additional Information (Detail) - USD ($) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |||
Capitalized commission fees | $ 400,000 | ||
Capitalized commission fees, amount of amortization | $ 30,000 | ||
(ASC) topic 606 | Restatement Adjustment [Member] | |||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |||
Effective change on revenue and transportation costs | $ 900,000 | $ 1,600,000 |
Acquisition - Additional Inform
Acquisition - Additional Information (Detail) | 6 Months Ended |
Jun. 30, 2018 | |
Estenson Logistics, LLC [Member] | |
Business Acquisition [Line Items] | |
Business acquisition date | Jul. 1, 2017 |
Unaudited Pro forma Consolidate
Unaudited Pro forma Consolidated Results of Operations (Detail) - Estenson Logistics, LLC [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | |
Business Acquisition [Line Items] | ||
Revenue | $ 983,029 | $ 1,930,373 |
Net income | $ 12,450 | $ 24,053 |
Earnings per share | ||
Basic | $ 0.38 | $ 0.73 |
Diluted | $ 0.38 | $ 0.72 |
Business Segments - Additional
Business Segments - Additional Information (Detail) | 6 Months Ended |
Jun. 30, 2018Segment | |
Segment Reporting [Abstract] | |
Reporting business segments | 2 |
Number of railheads | one or more |
Summary of Operating Results an
Summary of Operating Results and Certain Other Financial Data (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,179,093 | $ 923,596 | $ 2,275,064 | $ 1,816,352 |
Transportation costs | 1,042,903 | 822,279 | 2,016,083 | 1,613,450 |
Gross margin | 136,190 | 101,317 | 258,981 | 202,902 |
Costs and expenses: | ||||
Salaries and benefits | 58,092 | 45,038 | 114,099 | 88,217 |
Agent fees and commissions | 21,969 | 17,038 | 41,111 | 35,031 |
General and administrative | 20,216 | 20,114 | 40,720 | 40,938 |
Depreciation and amortization | 3,960 | 2,549 | 7,965 | 4,961 |
Total costs and expenses | 104,237 | 84,739 | 203,895 | 169,147 |
Operating income | 31,953 | 16,578 | 55,086 | 33,755 |
Capital Expenditures | 47,082 | 22,968 | 69,261 | 29,593 |
Operating Segments [Member] | Hub [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 888,238 | 704,344 | 1,719,823 | 1,380,824 |
Transportation costs | 788,087 | 631,787 | 1,529,297 | 1,236,462 |
Gross margin | 100,151 | 72,557 | 190,526 | 144,362 |
Costs and expenses: | ||||
Salaries and benefits | 53,839 | 41,569 | 105,909 | 81,164 |
Agent fees and commissions | 11 | 14 | 25 | 31 |
General and administrative | 17,768 | 18,331 | 36,170 | 36,810 |
Depreciation and amortization | 3,719 | 2,249 | 7,478 | 4,357 |
Total costs and expenses | 75,337 | 62,163 | 149,582 | 122,362 |
Operating income | 24,814 | 10,395 | 40,944 | 22,000 |
Capital Expenditures | 46,337 | 22,937 | 67,874 | 29,562 |
Operating Segments [Member] | Mode LLC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 314,078 | 242,998 | 601,977 | 484,832 |
Transportation costs | 278,039 | 214,238 | 533,522 | 426,292 |
Gross margin | 36,039 | 28,760 | 68,455 | 58,540 |
Costs and expenses: | ||||
Salaries and benefits | 4,253 | 3,469 | 8,190 | 7,053 |
Agent fees and commissions | 21,958 | 17,024 | 41,086 | 35,000 |
General and administrative | 2,448 | 1,783 | 4,550 | 4,128 |
Depreciation and amortization | 241 | 300 | 487 | 604 |
Total costs and expenses | 28,900 | 22,576 | 54,313 | 46,785 |
Operating income | 7,139 | 6,184 | 14,142 | 11,755 |
Capital Expenditures | 745 | 31 | 1,387 | 31 |
Intersegment Elims [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (23,223) | (23,746) | (46,736) | (49,304) |
Transportation costs | $ (23,223) | $ (23,746) | $ (46,736) | $ (49,304) |
Schedule of Assets (Detail)
Schedule of Assets (Detail) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 1,733,504 | $ 1,670,941 |
Goodwill, net | 348,106 | 348,661 |
Operating Segments [Member] | Hub [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | 1,513,130 | 1,470,792 |
Goodwill, net | 318,717 | 319,272 |
Operating Segments [Member] | Mode LLC [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | 227,425 | 210,088 |
Goodwill, net | 29,389 | 29,389 |
Intersegment Elims [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ (7,051) | $ (9,939) |
Summary of Revenue by Segment a
Summary of Revenue by Segment and Business Line (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 1,179,093 | $ 923,596 | $ 2,275,064 | $ 1,816,352 |
Intermodal [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 660,690 | 550,643 | 1,261,688 | 1,082,009 |
Truck brokerage [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 218,020 | 186,848 | 438,402 | 370,809 |
Logistics [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 226,530 | 186,105 | 440,741 | 363,534 |
Dedicated [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 73,853 | 134,233 | ||
Operating Segments [Member] | Hub [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 888,238 | 704,344 | 1,719,823 | 1,380,824 |
Operating Segments [Member] | Mode LLC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 314,078 | 242,998 | 601,977 | 484,832 |
Operating Segments [Member] | Intermodal [Member] | Hub [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 526,028 | 451,420 | 1,008,522 | 875,843 |
Operating Segments [Member] | Intermodal [Member] | Mode LLC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 141,221 | 112,089 | 270,995 | 234,269 |
Operating Segments [Member] | Truck brokerage [Member] | Hub [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 114,936 | 104,289 | 234,955 | 210,473 |
Operating Segments [Member] | Truck brokerage [Member] | Mode LLC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 103,168 | 82,869 | 203,889 | 161,031 |
Operating Segments [Member] | Logistics [Member] | Hub [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 173,421 | 148,635 | 342,098 | 294,508 |
Operating Segments [Member] | Logistics [Member] | Mode LLC [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 69,689 | 48,040 | 127,093 | 89,532 |
Operating Segments [Member] | Dedicated [Member] | Hub [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 73,853 | 134,248 | ||
Intersegment Elims [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (23,223) | (23,746) | (46,736) | (49,304) |
Intersegment Elims [Member] | Intermodal [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (6,559) | (12,866) | (17,829) | (28,103) |
Intersegment Elims [Member] | Truck brokerage [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | (84) | (310) | (442) | (695) |
Intersegment Elims [Member] | Logistics [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ (16,580) | $ (10,570) | (28,450) | $ (20,506) |
Intersegment Elims [Member] | Dedicated [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | $ (15) |
Reconciliation of Earnings Per
Reconciliation of Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income for basic and diluted earnings per share | $ 22,051 | $ 9,542 | $ 38,218 | $ 19,876 |
Weighted average shares outstanding - basic | 33,389 | 33,220 | 33,382 | 33,213 |
Dilutive effect of stock options and restricted stock | 173 | 42 | 138 | 105 |
Weighted average shares outstanding - diluted | 33,562 | 33,262 | 33,520 | 33,318 |
Earnings per share - basic | $ 0.66 | $ 0.29 | $ 1.14 | $ 0.60 |
Earnings per share - diluted | $ 0.66 | $ 0.29 | $ 1.14 | $ 0.60 |
Fair Value Measurement - Additi
Fair Value Measurement - Additional Information (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value Measurement [Line Items] | ||
Fair value of fixed-rate borrowings less than historical carrying value | $ 3.6 | $ 2.4 |
Fixed-rate borrowings, carrying value | 266.2 | 247.1 |
Restricted investments | 24.1 | $ 24.2 |
Estenson Logistics, LLC [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of contingent consideration | $ 1.1 |
Reconciliation of Changes in Fa
Reconciliation of Changes in Fair value of Contingent Consideration (Detail) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018USD ($) | ||
Fair Value Disclosures [Abstract] | ||
Fair value, Beginning Balance | $ 4,703 | |
Change in fair value | (3,571) | [1] |
Fair value, Ending Balance | $ 1,132 | |
[1] | We recorded an adjustment to the contingent consideration liability in the second quarter of 2018, resulting in an increase in income from operations. The income was recorded under “General and Administrative” in the Consolidated Statement of Income. The adjustment was the result of a change in the fair value of the contingent liability, which reflected two year EBITDA targets established prior to the close of the acquisition. |
Long-Term Debt and Financing 32
Long-Term Debt and Financing Arrangements - Additional Information (Detail) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Revolving Line of Credit Facility [Member] | ||
Line Of Credit Facility [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 350,000,000 | |
Borrowings under bank revolving line of credit | $ 45,000,000 | |
Revolving Line of Credit Facility [Member] | Bank Revolving Line of Credit [Member] | ||
Line Of Credit Facility [Line Items] | ||
Unused and available borrowings under bank revolving line of credit | 327,000,000 | 284,900,000 |
Borrowings under bank revolving line of credit | $ 0 | $ 45,000,000 |
Standby Letters of Credit [Member] | ||
Line Of Credit Facility [Line Items] | ||
Letters of credit expiration year one | 2,018 | |
Letters of credit expiration year two | 2,019 | |
Outstanding letters of credit | $ 23,000,000 |
Schedule of Outstanding Debt (D
Schedule of Outstanding Debt (Detail) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Revolving line of credit & Secured long-term debt | $ 266,184 | $ 292,074 |
Less current portion | (86,740) | (77,266) |
Total long-term debt | 179,444 | 214,808 |
Revolving Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Revolving line of credit | 45,000 | |
Secured Equipment Notes due in 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | 12,691 | 13,586 |
Secured Equipment Notes due in 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | 91,077 | 36,981 |
Secured Equipment Notes due in 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | 27,435 | 30,301 |
Secured Equipment Notes due in 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | 66,863 | 76,885 |
Secured Equipment Notes due in 2020 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | 42,960 | 50,737 |
Secured Equipment Notes due in 2019 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | $ 25,158 | 36,178 |
Secured Equipment Notes due in 2018 [Member] | ||
Debt Instrument [Line Items] | ||
Secured long-term debt | $ 2,406 |
Schedule of Outstanding Debt (P
Schedule of Outstanding Debt (Parenthetical) (Detail) | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Secured Equipment Notes due in 2024 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,024 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2024 [Member] | Commencing on 2017 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,017 |
Secured Equipment Notes due in 2023 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,023 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2023 [Member] | Commencing on 2017 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,017 |
Secured Equipment Notes due in 2023 [Member] | Commencing on 2016 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,016 |
Secured Equipment Notes due in 2023 [Member] | Commencing on 2018 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,018 |
Secured Equipment Notes due in 2022 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,022 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2022 [Member] | Commencing on 2017 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,017 |
Secured Equipment Notes due in 2022 [Member] | Commencing on 2015 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,015 |
Secured Equipment Notes due in 2021 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,021 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2021 [Member] | Commencing on 2017 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,017 |
Secured Equipment Notes due in 2021 [Member] | Commencing on 2014 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,014 |
Secured Equipment Notes due in 2020 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,020 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2020 [Member] | Commencing on 2016 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,016 |
Secured Equipment Notes due in 2020 [Member] | Commencing on 2013 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,013 |
Secured Equipment Notes due in 2019 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,019 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2019 [Member] | Commencing on 2013 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,013 |
Secured Equipment Notes due in 2019 [Member] | Commencing on 2015 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,015 |
Secured Equipment Notes due in 2018 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes due period | 2,018 |
Payment Frequency | monthly |
Secured Equipment Notes due in 2018 [Member] | Commencing on 2013 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,013 |
Secured Equipment Notes due in 2018 [Member] | Commencing on 2014 [Member] | |
Debt Instrument [Line Items] | |
Equipment notes, date of first required payment | 2,014 |
Minimum [Member] | Secured Equipment Notes due in 2024 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 403 |
Interest rate secured debt | 2.85% |
Minimum [Member] | Secured Equipment Notes due in 2023 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 669 |
Interest rate secured debt | 2.23% |
Minimum [Member] | Secured Equipment Notes due in 2022 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 3,030 |
Interest rate secured debt | 2.16% |
Minimum [Member] | Secured Equipment Notes due in 2021 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 1,940 |
Interest rate secured debt | 2.04% |
Minimum [Member] | Secured Equipment Notes due in 2020 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 3,614 |
Interest rate secured debt | 1.72% |
Minimum [Member] | Secured Equipment Notes due in 2019 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 1,594 |
Interest rate secured debt | 1.79% |
Minimum [Member] | Secured Equipment Notes due in 2018 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 6,480 |
Interest rate secured debt | 2.05% |
Maximum [Member] | Secured Equipment Notes due in 2024 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 83,000 |
Interest rate secured debt | 3.41% |
Maximum [Member] | Secured Equipment Notes due in 2023 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 341,341 |
Interest rate secured debt | 3.91% |
Maximum [Member] | Secured Equipment Notes due in 2022 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 254,190 |
Interest rate secured debt | 2.87% |
Maximum [Member] | Secured Equipment Notes due in 2021 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 352,655 |
Interest rate secured debt | 2.96% |
Maximum [Member] | Secured Equipment Notes due in 2020 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 398,496 |
Interest rate secured debt | 2.78% |
Maximum [Member] | Secured Equipment Notes due in 2019 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 325,050 |
Interest rate secured debt | 2.62% |
Maximum [Member] | Secured Equipment Notes due in 2018 [Member] | |
Debt Instrument [Line Items] | |
Monthly payments | $ 163,428 |
Interest rate secured debt | 2.70% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended |
Nov. 30, 2016Container | Jun. 30, 2018ContainerTractorTrailer | Jun. 30, 2018USD ($)TractorTrailer | |
Commitments And Contingencies Disclosure [Abstract] | |||
Purchase contract units, containers | Container | 4,000 | 3,670 | |
Purchase contract units tractors | Tractor | 869 | ||
Cost of purchasing tractors | $ | $ 107.2 | ||
Number of tractors received | Tractor | 380 | 380 | |
Number of tractors expected to be received in remainder of fiscal year | Tractor | 489 | 489 | |
Purchase contract units trailers | Trailer | 760 | ||
Cost of purchasing trailers | $ | $ 24.2 | ||
Number of trailers received | Trailer | 217 | 217 | |
Number of trailers expected to be received in remainder of fiscal year | Trailer | 543 | 543 |
Legal Matters - Additional Info
Legal Matters - Additional Information (Detail) - Robles Lawsuits [Member] | Aug. 05, 2015PlaintiffEmployee | May 31, 2015Plaintiff | Jun. 30, 2018 |
Loss Contingencies [Line Items] | |||
Percentage of California drivers who accepted settlement offers | 96.00% | ||
Number of new plaintiffs | 2 | ||
Number of plaintiffs against Hub Group Trucking | 63 | ||
Number of employees filed lawsuit | Employee | 5 | ||
Number of claims accepted settlement offers | 58 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Line Items] | ||||||
Provision for income taxes increased | $ 7,548 | $ 6,204 | $ 12,377 | $ 12,273 | ||
Effective income tax rate | 25.50% | 39.40% | 24.50% | 38.20% | ||
Federal corporate tax rate | 21.00% | 35.00% | ||||
Scenario, Plan [Member] | Minimum [Member] | ||||||
Income Taxes [Line Items] | ||||||
Effective income tax rate | 24.50% | |||||
Scenario, Plan [Member] | Maximum [Member] | ||||||
Income Taxes [Line Items] | ||||||
Effective income tax rate | 25.50% |