Landstar System Reports 12% Revenue Decline, Net Income Drop Amid Transportation Sector Challenges

Landstar System, Inc. reported a decline in financial performance for the thirty-nine weeks ended September 28, 2024, compared to the same period in 2023. Total revenue decreased by $488.96 million, or 12%, to $3.61 billion, primarily driven by a 10% reduction in the number of loads hauled and a 3% decrease in revenue per load. Truck transportation revenue, which constitutes 90% of total revenue, fell by $478.67 million, or 13%, to $3.27 billion. The company attributed this decline to decreased activity across various transportation services, including a 27% drop in loads hauled via other truck transportation services and an 11% decrease in less-than-truckload loadings.

Despite the revenue drop, total costs and expenses also decreased by $406.4 million, or 11%, to $3.43 billion, leading to an operating income of $191.14 million, down from $269.58 million in the prior year. Net income for the thirty-nine weeks was $149.75 million, or $4.21 per share, compared to $206.41 million, or $5.74 per share, in the previous year. The company declared dividends of $1.02 per share, an increase from $0.93 per share in the same period last year.

For the thirteen weeks ended September 28, 2024, revenue was $1.21 billion, a decrease of $75.48 million, or 6%, compared to the same period in 2023. Net income for this quarter was $50.03 million, down from $61.65 million in the prior year. The company reported a slight increase in revenue per load, despite an overall decrease in the number of loads.

Landstar's total current assets decreased to $1.31 billion from $1.35 billion at the end of 2023, while total assets fell to $1.76 billion. Current liabilities also decreased, resulting in an increase in retained earnings to $2.90 billion and total shareholders’ equity rising to $1.02 billion.

Strategically, Landstar acquired operating property through finance leases amounting to $24.24 million during the thirty-nine-week period, while no such acquisitions occurred in the previous year. The company repurchased $79.39 million of its common stock during the same period, reflecting a commitment to returning value to shareholders.

Overall, Landstar's performance reflects challenges in the transportation sector, with significant revenue declines offset by reductions in costs, maintaining a focus on shareholder returns through dividends and stock repurchases.