8-K
LANDSTAR SYSTEM INC (LSTR)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 13, 2025
LANDSTAR SYSTEM, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 021238 | 06-1313069 |
|---|---|---|
| (State or other jurisdiction | (Commission | (I.R.S. Employer |
| of incorporation) | File Number) | Identification No.) |
| 13410 Sutton Park Drive South, Jacksonville, Florida | 32224 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
(904) 398-9400
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br> <br>Symbol(s) | Name of each exchange<br> <br>on which registered |
|---|---|---|
| Common Stock | LSTR | NASDAQ |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition |
|---|
On May 13, 2025, Landstar System, Inc. (“Landstar” or the “Company”) issued a press release announcing results for the first quarter of fiscal 2025. A copy of the press release is attached hereto as Exhibit 99.1.
The information contained in Item 7.01 concerning the presentation to Landstar investors is hereby incorporated into this Item 2.02 by reference.
The information furnished under Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
| Item 7.01 | Regulation FD Disclosure |
|---|
A slide presentation, dated May 13, 2025, is attached hereto as Exhibit 99.2 and is incorporated herein by reference. The slide presentation provides information that may be referred to by the Company on its conference call with investors scheduled to occur on May 13, 2025 in connection with the Company’s release of results for the first quarter of fiscal 2025.
The information furnished under Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.2 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
| Item 9.01 | Financial Statements and Exhibits |
|---|---|
| Exhibits | |
| --- | --- |
| 99.1 | Press Release, dated May 13, 2025, of Landstar System, Inc. |
| 99.2 | Slide Presentation, dated May 13, 2025, of Landstar System, Inc. |
| 104 | Inline XBRL for the cover page of this Current Report on Form 8-K |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| LANDSTAR SYSTEM, INC. | |||
|---|---|---|---|
| Date: May 13, 2025 | By: | /s/ James P. Todd | |
| Name: | James P. Todd | ||
| Title: | Vice President, Chief Financial Officer<br>and Assistant Secretary |
EX-99.1
Exhibit 99.1
| For Immediate Release | May 13, 2025 |
|---|
LANDSTAR SYSTEM REPORTS FIRST QUARTER
REVENUE OF $1.153B AND EARNINGS PER SHARE OF $0.85 AND
ANNOUNCES 11% INCREASE TO QUARTERLY DIVIDEND
Jacksonville, FL - Landstar System, Inc. (NASDAQ: LSTR) (“Landstar” or the “Company”) today reported basic and diluted earnings per share (“EPS”) of $0.85 in the 2025 first quarter on revenue of $1.153 billion. “The Landstar team of independent business owners and employees continued to perform admirably, despite a highly unpredictable macro-economic backdrop,” said Landstar President and Chief Executive Officer Frank Lonegro. “I was encouraged by the number of loads hauled via truck in the quarter. Importantly, this was the first time in fifteen years that the number of loads hauled via truck during the first quarter exceeded the immediately preceding fourth quarter. Our network of Landstar BCOs, agents and employees are laser-focused on safety, security and delivering great service to our customers in an extremely fluid freight transportation environment.”
| 1Q 2025 | 1Q 2024 | |||
|---|---|---|---|---|
| Revenue | $ | 1,152,502 | $ | 1,171,043 |
| Gross profit | $ | 98,305 | $ | 113,902 |
| Variable contribution | $ | 161,310 | $ | 168,240 |
| Operating income | $ | 39,419 | $ | 59,961 |
| Basic and diluted earnings per share | $ | 0.85 | $ | 1.32 |
| (1) | Dollars above in thousands, except per share amounts. | |||
| --- | --- | |||
| (2) | Please refer to the Consolidated Statements of Income and Reconciliation of Gross Profit to Variable<br>Contribution included below. | |||
| --- | --- |
As previously disclosed in Current Reports on Form 8-K filed with the U.S. Securities and Exchange Commission on April 2, 2025 (the “April 2^nd^ 8-K”), and subsequently on April 25, 2025 (the “April 25^th^ 8-K”), during the last week of the Company’s 2025 first quarter, Landstar identified a supply chain fraud relating to the Company’s international freight forwarding operations that does not involve its core North American truckload services. While investigation, remediation and collection efforts continue, the 2025 first quarter results include a $4.8 million pre-tax charge, or $0.10 per share, relating to this matter.
LANDSTAR SYSTEM/2
This charge currently reflects the total anticipated adverse financial impact to Landstar relating to the fraud, net of certain actual and anticipated recoveries and before taking into account the cost of legal and other professional fees as well as additional potential recoveries in the future. This charge is reflected in selling, general & administrative costs.
Landstar continues to return capital to stockholders through the Company’s stock purchase program and dividends. During the 2025 first quarter, Landstar purchased approximately 386,000 shares of its common stock at an aggregate cost of $60.9 million and paid $83.3 million to stockholders in the form of cash dividends. The Company is currently authorized to purchase up to an additional 2,161,663 shares of the Company’s common stock under its longstanding share purchase program. Landstar also announced today that its Board of Directors declared a quarterly dividend of $0.40 per share payable on June 24, 2025, to stockholders of record as of the close of business on June 5, 2025. This quarterly dividend includes a $0.04 per share increase, or 11% over the amount of the Company’s regular quarterly dividend declared following each of the prior three quarters.
Total revenue was $1,153 million in the 2025 first quarter, compared to $1,171 million in the 2024 first quarter. Truck transportation revenue hauled by independent business capacity owners (“BCOs”) and truck brokerage carriers in the 2025 first quarter was $1,050 million, or 91% of revenue, compared to $1,069 million, or 91% of revenue, in the 2024 first quarter. Truckload transportation revenue hauled via van equipment in the 2025 first quarter was $595 million, compared to $628 million in the 2024 first quarter. Truckload transportation revenue hauled via unsided/platform equipment in the 2025 first quarter was $340 million, compared to $343 million in the 2024 first quarter. Revenue from other truck transportation, which is largely related to power-only services, in the 2025 first quarter was $92 million, compared to $72 million in the 2024 first quarter. Revenue hauled by rail, air and ocean cargo carriers was $83 million, or 7% of revenue, in the 2025 first quarter, compared to $77 million, or 7% of revenue, in the 2024 first quarter.
LANDSTAR SYSTEM/3
The number of loads hauled via truck declined 1.2% in the 2025 first quarter as compared to the 2024 first quarter. This performance was slightly better than the high-end of the Company’s guidance range of 7% below to 2% below prior year included in its 2024 fourth quarter earnings release slide presentation, dated January 29, 2025 (the “2025 First Quarter Guidance”). Truck revenue per load decreased 0.6% in the 2025 first quarter as compared to the 2024 first quarter, below the mid-point of the guidance range of 2% below to 3% above prior year provided in the 2025 First Quarter Guidance. As a result, first quarter revenue exceeded the mid-point of the range included in the Company’s 2025 First Quarter Guidance.
The April 25^th^ 8-K announced that 2025 first quarter EPS was $0.95, prior to giving effect to any potential adverse impact from the supply chain fraud matter referenced above. As also noted in the April 25^th^ 8-K, the adverse financial impact to Landstar, before taking into account the cost of legal and other professional fees or any potential insurance and other recoveries, was not expected to exceed $0.43 per share on an after-tax basis. As previously stated, 2025 first quarter EPS was $0.85, inclusive of $0.10 per share relating to the supply chain fraud matter. As previewed by the April 2^nd^ 8-K, 2025 first quarter EPS also reflected highly elevated insurance and claim costs of 9.3% of BCO revenue, well above the Company’s average historical experience from the 2019 fiscal year through the 2024 fiscal year of 4.9%, primarily due to cargo theft and truck accident adverse prior year claim development.
Gross profit in the 2025 first quarter was $98 million and variable contribution (defined as revenue less the cost of purchased transportation and commissions to agents) in the 2025 first quarter was $161 million. Gross profit in the 2024 first quarter was $114 million and variable contribution in the 2024 first quarter was $168 million. Reconciliations of gross profit to variable contribution and gross profit margin to variable contribution margin for the 2025 and 2024 first quarters are provided in the Company’s accompanying financial disclosures.
The Company’s balance sheet continues to be very strong, with cash and short-term investments of approximately $473 million as of March 29, 2025. Trailing twelve-month return on average shareholders’ equity was 18%, and return on invested capital, representing net income divided by the sum of average equity plus average debt, was 17%.
LANDSTAR SYSTEM/4
Landstar will provide a live webcast of its quarterly earnings conference call this morning at 8:30 a.m. ET. To access the webcast, visit www.investor.landstar.com; click on “Webcasts,” then click on “Landstar’s First Quarter 2025 Earnings Release Conference Call.” A slide presentation to accompany the webcast presentation is also available on Landstar’s investor relations website at https://investor.landstar.com/.
Contact:
Jim Todd
Chief Financial Officer
904-398-9400
About Landstar:
Landstar System, Inc., is a technology-enabled, asset-light provider of integrated transportation management solutions delivering safe, specialized transportation services to a broad range of customers utilizing a network of agents, third-party capacity providers and employees. Landstar transportation services companies are certified to ISO 9001:2015 quality management system standards and RC14001:2015 environmental, health, safety and security management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market^®^ under the symbol LSTR.
Non-GAAP Financial Measures*:*
In this earnings release and accompanying financial disclosures, the Company provides the following information that may be deemed non-GAAP financial measures: variable contribution and variable contribution margin. The Company believes variable contribution and variable contribution margin are useful measures of the variable costs that we incur at a shipment-by-shipment level attributable to our transportation network of third-party capacity providers and independent agents in order to provide services to our customers. The Company also believes that it is appropriate to present each of the financial measures that may be deemed a non-GAAP financial measure, as referred to above, for the following reasons: (1) disclosure of these matters will allow investors to better understand the underlying trends in the Company’s financial condition and results of operations; (2) this information will facilitate comparisons by investors of the Company’s results as compared to the results of peer companies; and (3) management considers this financial information in its decision making.
LANDSTAR SYSTEM/5
Forward Looking Statements Disclaimer:
The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995. Statements contained in this press release that are not based on historical facts are “forward-looking statements.” This press release contains forward-looking statements, such as statements which relate to Landstar’s business objectives, plans, strategies and expectations. Terms such as “anticipates,” “believes,” “estimates,” “intention,” “expects,” “plans,” “predicts,” “may,” “should,” “could,” “will,” the negative thereof and similar expressions are intended to identify forward-looking statements. Such statements are by nature subject to uncertainties and risks, including but not limited to: U.S. trade relationships; an increase in the frequency or severity of accidents or other claims; unfavorable development of existing accident claims; dependence on third party insurance companies; dependence on independent commission sales agents; dependence on third party capacity providers; the impact of the Russian conflict with Ukraine on the operations of certain independent commission sales agents, including the Company’s largest such agent by revenue in the 2024 fiscal year; decreased demand for transportation services; substantial industry competition; disruptions or failures in the Company’s computer systems; cyber and other information security incidents; dependence on key vendors; potential changes in taxes; status of independent contractors; regulatory and legislative changes; regulations focused on diesel emissions and other air quality matters; regulations requiring the purchase and use of zero-emission vehicles; intellectual property; and other operational, financial or legal risks or uncertainties detailed in Landstar’s Form 10-K for the 2024 fiscal year, described in Item 1A Risk Factors, and in other SEC filings from time to time. These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated. Investors should not place undue reliance on such forward-looking statements, and the Company undertakes no obligation to publicly update or revise any forward-looking statements.
Landstar System, Inc. and Subsidiary
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)
| Thirteen Weeks Ended | ||||||
|---|---|---|---|---|---|---|
| March 29, | March 30, | |||||
| 2025 | 2024 | |||||
| Revenue | $ | 1,152,502 | $ | 1,171,043 | ||
| Investment income | 3,598 | 3,412 | ||||
| Costs and expenses: | ||||||
| Purchased transportation | 897,878 | 905,521 | ||||
| Commissions to agents | 93,314 | 97,282 | ||||
| Other operating costs, net of gains on asset sales/dispositions | 11,829 | 14,859 | ||||
| Insurance and claims | 39,852 | 26,268 | ||||
| Selling, general and administrative | 61,582 | 56,422 | ||||
| Depreciation and amortization | 12,226 | 14,142 | ||||
| Total costs and expenses | 1,116,681 | 1,114,494 | ||||
| Operating income | 39,419 | 59,961 | ||||
| Interest and debt (income) expense | (159 | ) | (1,611 | ) | ||
| Income before income taxes | 39,578 | 61,572 | ||||
| Income taxes | 9,772 | 14,476 | ||||
| Net income | $ | 29,806 | $ | 47,096 | ||
| Basic and diluted earnings per share | $ | 0.85 | $ | 1.32 | ||
| Average basic and diluted shares outstanding | 35,203,000 | 35,750,000 | ||||
| Dividends per common share | $ | 0.36 | $ | 0.33 |
Landstar System, Inc. and Subsidiary
Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
(Unaudited)
| December 28, | |||||
|---|---|---|---|---|---|
| 2024 | |||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 417,420 | $ | 515,018 | ||
| Short-term investments | 56,016 | 51,619 | |||
| Trade accounts receivable, less allowance of 16,316 and 12,904 | 703,181 | 683,841 | |||
| Other receivables, including advances to independent contractors, less allowance of 16,998 and<br>17,812 | 48,433 | 47,160 | |||
| Other current assets | 16,571 | 22,229 | |||
| Total current assets | 1,241,621 | 1,319,867 | |||
| Operating property, less accumulated depreciation and amortization of 456,072 and<br>456,547 | 297,517 | 311,345 | |||
| Goodwill | 40,881 | 40,933 | |||
| Other assets | 136,159 | 141,166 | |||
| Total assets | 1,716,178 | $ | 1,813,311 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||
| Current liabilities: | |||||
| Cash overdraft | 59,359 | $ | 61,033 | ||
| Accounts payable | 389,592 | 383,625 | |||
| Current maturities of long-term debt | 32,024 | 33,116 | |||
| Insurance claims | 37,638 | 40,511 | |||
| Dividends payable | — | 70,632 | |||
| Other current liabilities | 93,701 | 84,237 | |||
| Total current liabilities | 612,314 | 673,154 | |||
| Long-term debt, excluding current maturities | 61,944 | 69,191 | |||
| Insurance claims | 75,436 | 62,842 | |||
| Deferred income taxes and other non-current<br>liabilities | 35,729 | 35,685 | |||
| Shareholders’ equity: | |||||
| Common stock, 0.01 par value, authorized 160,000,000 shares, issued 68,581,772 and<br>68,559,269 | 686 | 686 | |||
| Additional paid-in capital | 257,296 | 255,260 | |||
| Retained earnings | 2,877,034 | 2,859,916 | |||
| Cost of 33,635,595 and 33,243,196 shares of common stock in treasury | (2,193,265 | ) | (2,131,413 | ) | |
| Accumulated other comprehensive loss | (10,996 | ) | (12,010 | ) | |
| Total shareholders’ equity | 930,755 | 972,439 | |||
| Total liabilities and shareholders’ equity | 1,716,178 | $ | 1,813,311 |
All values are in US Dollars.
Landstar System, Inc. and Subsidiary
Supplemental Information
(Unaudited)
| Thirteen Weeks Ended | ||||||
|---|---|---|---|---|---|---|
| March 29, | March 30, | |||||
| 2025 | 2024 | |||||
| Revenue generated through (in thousands): | ||||||
| Truck transportation | ||||||
| Truckload: | ||||||
| Van equipment | $ | 594,795 | $ | 628,304 | ||
| Unsided/platform equipment | 340,408 | 343,045 | ||||
| Less-than-truckload | 22,436 | 25,617 | ||||
| Other truck transportation ^(1)^ | 92,079 | 71,966 | ||||
| Total truck transportation | 1,049,718 | 1,068,932 | ||||
| Rail intermodal | 17,487 | 22,695 | ||||
| Ocean and air cargo carriers | 65,637 | 54,074 | ||||
| Other ^(2)^ | 19,660 | 25,342 | ||||
| $ | 1,152,502 | $ | 1,171,043 | |||
| Revenue on loads hauled via BCO Independent Contractors ^(3)^included in total truck transportation | $ | 427,057 | $ | 452,561 | ||
| Number of loads: | ||||||
| Truck transportation | ||||||
| Truckload: | ||||||
| Van equipment | 288,063 | 299,014 | ||||
| Unsided/platform equipment | 117,245 | 117,947 | ||||
| Less-than-truckload | 35,580 | 40,233 | ||||
| Other truck transportation ^(1)^ | 44,012 | 33,526 | ||||
| Total truck transportation | 484,900 | 490,720 | ||||
| Rail intermodal | 6,150 | 7,150 | ||||
| Ocean and air cargo carriers | 9,120 | 8,720 | ||||
| 500,170 | 506,590 | |||||
| Loads hauled via BCO Independent Contractors ^(3)^included in total truck transportation | 194,070 | 208,740 | ||||
| Revenue per load: | ||||||
| Truck transportation | ||||||
| Truckload: | ||||||
| Van equipment | $ | 2,065 | $ | 2,101 | ||
| Unsided/platform equipment | 2,903 | 2,908 | ||||
| Less-than-truckload | 631 | 637 | ||||
| Other truck transportation ^(1)^ | 2,092 | 2,147 | ||||
| Total truck transportation | 2,165 | 2,178 | ||||
| Rail intermodal | 2,843 | 3,174 | ||||
| Ocean and air cargo carriers | 7,197 | 6,201 | ||||
| Revenue per load on loads hauled via BCO Independent Contractors ^(3)^ | $ | 2,201 | $ | 2,168 | ||
| Revenue by capacity type (as a % of total revenue): | ||||||
| Truck capacity providers: | ||||||
| BCO Independent Contractors ^(3)^ | 37 | % | 39 | % | ||
| Truck Brokerage Carriers | 54 | % | 53 | % | ||
| Rail intermodal | 2 | % | 2 | % | ||
| Ocean and air cargo carriers | 6 | % | 5 | % | ||
| Other | 2 | % | 2 | % | ||
| March 29, | March 30, | |||||
| 2025 | 2024 | |||||
| Truck Capacity Providers | ||||||
| BCO Independent Contractors ^(3)^ | 7,871 | 8,619 | ||||
| Truck Brokerage Carriers: | ||||||
| Approved and active ^(4)^ | 47,323 | 45,919 | ||||
| Other approved | 33,275 | 26,320 | ||||
| 80,598 | 72,239 | |||||
| Total available truck capacity providers | 88,469 | 80,858 | ||||
| Trucks provided by BCO Independent Contractors<br>^(3)^ | 8,620 | 9,410 | ||||
| (1) | Includes power-only, expedited, straight truck, cargo van, and miscellaneous other truck transportation revenue<br>generated by the transportation logistics segment. Power-only refers to shipments where the Company furnishes a power unit and an operator but not trailing equipment, which is typically provided by the shipper or consignee. | |||||
| --- | --- | |||||
| (2) | Includes primarily reinsurance premium revenue generated by the insurance segment and intra-Mexico<br>transportation services revenue generated by Landstar Metro. | |||||
| --- | --- | |||||
| (3) | BCO Independent Contractors are independent contractors who provide truck capacity to the Company under<br>exclusive lease arrangements. | |||||
| --- | --- | |||||
| (4) | Active refers to Truck Brokerage Carriers who moved at least one load in the 180 days immediately preceding the<br>fiscal quarter end. | |||||
| --- | --- |
Landstar System, Inc. and Subsidiary
Reconciliation of Gross Profit to Variable Contribution
(Dollars in thousands)
(Unaudited)
| Thirteen Weeks Ended | ||||||
|---|---|---|---|---|---|---|
| March 29, | March 30, | |||||
| 2025 | 2024 | |||||
| Revenue | $ | 1,152,502 | $ | 1,171,043 | ||
| Costs of revenue: | ||||||
| Purchased transportation | 897,878 | 905,521 | ||||
| Commissions to agents | 93,314 | 97,282 | ||||
| Variable costs of revenue | 991,192 | 1,002,803 | ||||
| Trailing equipment depreciation | 6,977 | 6,897 | ||||
| Information technology costs (1) | 3,675 | 5,804 | ||||
| Insurance-related costs (2) | 40,524 | 26,778 | ||||
| Other operating costs | 11,829 | 14,859 | ||||
| Other costs of revenue | 63,005 | 54,338 | ||||
| Total costs of revenue | 1,054,197 | 1,057,141 | ||||
| Gross profit | $ | 98,305 | $ | 113,902 | ||
| Gross profit margin | 8.5 | % | 9.7 | % | ||
| Plus: other costs of revenue | 63,005 | 54,338 | ||||
| Variable contribution | $ | 161,310 | $ | 168,240 | ||
| Variable contribution margin | 14.0 | % | 14.4 | % | ||
| (1) | Includes costs of revenue incurred related to internally developed software including ASC 350-40 amortization, implementation costs, hosting costs and other support costs utilized to support the Company’s independent commission sales agents, third party capacity providers, and customers, included as<br>a portion of depreciation and amortization and of selling, general and administrative in the Company’s Consolidated Statements of Income. | |||||
| --- | --- | |||||
| (2) | Primarily includes (i) insurance premiums paid for commercial auto liability, general liability, cargo and<br>other lines of coverage related to the transportation of freight; (ii) the related cost of claims incurred under those programs; and (iii) brokerage commissions and other fees incurred relating to the administration of insurance programs<br>available to BCO Independent Contractors that are reinsured by the Company, which are included in selling, general and administrative in the Company’s Consolidated Statements of Income. | |||||
| --- | --- |
EX-99.2
Date Landstar System, Inc. Earnings Conference Call 1Q 2025 Exhibit 99.2
Forward-Looking Statements Disclaimer The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995. Statements made in this slide presentation that are not based on historical facts are “forward-looking statements.” This presentation may make certain statements containing forward-looking statements, such as statements which relate to Landstar’s business objectives, plans, strategies and expectations. Such statements are by nature subject to uncertainties and risks, including but not limited to: the operational, financial or legal risks or uncertainties detailed in Landstar’s Form 10-K for the 2024 fiscal year, described in the section Risk Factors, and other SEC filings from time to time. These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated. Investors should not place undue reliance on such forward-looking statements, and the Company undertakes no obligation to publicly update or revise any forward-looking statements. 1Q 2025
In this slide presentation, the Company provides the following information that may be deemed a non-GAAP financial measure: variable contribution, variable contribution margin and operating income as a percentage of variable contribution. Management believes variable contribution and variable contribution margin are useful measures of the variable costs that we incur at a shipment-by-shipment level attributable to our transportation network of third-party capacity providers and independent agents in order to provide services to our customers. Management believes that operating income as a percentage of variable contribution is a useful measure as: (i) variable costs of revenue for a significant portion of the Company’s business are highly influenced by short-term market-based trends in the freight transportation industry, whereas other costs, including other costs of revenue, are much less impacted by short-term freight market trends; and (ii) this measure is meaningful to investors’ evaluations of the Company’s management of costs attributable to operations other than the purely variable costs associated with purchased transportation and commissions to agents that the Company incurs to provide services to our customers. Management also believes that it is appropriate to present each of the financial measures that may be deemed a non-GAAP financial measure, as referred to above, for the following reasons: (1) disclosure of these matters will allow investors to better understand the underlying trends in the Company’s financial condition and results of operations; (2) this information will facilitate comparisons by investors of the Company’s results as compared to the results of peer companies; and (3) management considers this financial information in its decision making. A tabulation of the expenses identified as costs of revenue as well as a reconciliation of gross profit to variable contribution and gross profit margin to variable contribution margin for the 2025 and 2024 first quarters is included in this slide presentation within the Appendix. Non-GAAP Financial Measures 1Q 2025
Frank Lonegro Chief Executive Officer 1Q 2025 Executive Summary
Slide header CEO Perspective R E S U L T S Dollars in Millions (except per share amounts) H I G H L I G H T S 1Q revenue performance Stronger than mid-point of guidance For the first time in 15 years, the number of loads hauled via truck in 1Q exceeded the immediately preceding 4Q Operating income and EPS Negatively impacted by elevated insurance and claims costs and previously disclosed supply chain fraud Strong balance sheet Continuing to return meaningful capital to stockholders Announced 11% increase to regular quarterly dividend one quarter earlier than normal cadence Investing through the cycle Supporting our network of entrepreneurs with continued investment Metric 1Q 2025 1Q 2024 Chg. Revenue $ 1,152.5 $ 1,171.0 (1.6%) Operating Income $ 39.4 $ 60.0 (34.3%) Earnings per Share $ 0.85 $ 1.32 (35.6%)
$1.05B Truck Revenue 485K Truck Loadings $2,165 Truck Revenue per Load 485 Million $ Agents* 8,620 BCO Trucks 80,598 Carriers 17,300+ Trailers 0.69 DOT Accidents per Million Miles** * Based on 2024 fiscal year **See definition of DOT accidents within the Appendix Landstar Network and 1Q Operating Results 1Q R E S U L T S L A N D S T A R N E T W O R K Agents ~1,030 Customers 23,000+ Capacity 88,000+ Employees ~1,400
Truck Capacity All information is provided as of the end of the applicable period Active refers to truck brokerage carriers who hauled freight for Landstar in the 180-day period immediately preceding the period end. Note: Fuel surcharges billed to customers on freight hauled by BCO Independent Contractors, which are paid 100% to the BCO and not included in either revenue or the cost of purchased transportation, were $54.2 million and $67.5 million in the 2025 and 2024 first quarters, respectively. A V A I L A B L E T R U C K C A P A C I T Y P R O V I D E R S Type of Capacity Mar 29, 2025 Dec 28, 2024 Mar 30, 2024 BCO Independent Contractors 7,871 8,082 8,619 Truck Brokerage Carriers Approved and Active (1) 47,323 43,718 45,919 Other Approved 33,275 26,527 26,320 Total Truck Brokerage Carriers 80,598 70,245 72,239 Total Available Truck Capacity Providers 88,469 78,327 80,858 Trucks Provided by BCO Independent Contractors 8,620 8,843 9,410
Jim Todd Chief Financial Officer 1Q 2025 Financial Results
Revenue Source Rate (1) Vol. (2) Chg. Truck (0.6%) (1.2%) (1.8%) Rail Intermodal (10.4%) (14.0%) (22.9%) Ocean/Air 16.1% 4.6%) 21.4% Insurance Premiums N/A N/A (10.6%) Total Revenue — — (1.6%) Slide header R E S U L T S V A R I A N C E Revenue Dollars in Millions Percentage change in rate is calculated on a revenue per load basis. Percentage change in volume is calculated on the number of loads hauled.
Revenue Variances by Industry Served with Revenue Share Indicated Amounts in Percent Revenue Share Y-O-Y Change 1Q 2025 1Q 2024 Market Segment in Revenue 29.0 28.1 Consumer Durables 2 14.4 13.5 Machinery 5 9.1 11.7 Automotive (23) 8.7 8.6 Building Products 0 7.3 5.6 Electrical 29 7.2 8.3 AA&E, Hazmat (15) 5.1 5.2 Metals (3) 2.9 1.9 Energy 51 2.0 1.6 Substitute Line Haul 23 14.3 15.5 Other (8) Transportation logistics revenue down 1% Y-O-Y
Gross Profit (1) and Variable Contribution (2) with Associated Margins Dollars in Millions Gross Profit Variable Contribution Amounts in % 1Q 2024 14.4 Change in Mix/Other (0.3) Revenue – Fixed (3) (0.2) Revenue – Variable 0.1 2025 14.0 C H A N G E I N V C M A R G I N Gross profit equals revenue less the cost of purchased transportation, commissions to agents and other costs of revenue. Gross profit margin equals gross profit divided by revenue. Variable contribution (VC) equals revenue less the cost of purchased transportation and commissions to agents. Variable contribution margin equals VC divided by revenue. Revenue on transactions where the Company’s variable contribution margin was based on a contractually pre-determined percentage of revenue accounted for 42% and 44% of revenue in the 2025 and 2024 first quarters, respectively. R E S U L T S 8.5% 9.7% 14.0% 14.4%
Operating Income Percentage of Gross Profit Variable Contribution Slide header Operating Income as a Percentage of Gross Profit and Variable Contribution Dollars in Millions C H A N G E I N P E R C E N T A G E of Variable Contribution R E S U L T S Amounts in % 1Q 2024 35.6) Insurance and claims (8.9) SG&A (4.6) Depreciation and amortization 0.8 Other operating costs 1.5 2025 24.4)
Return Type Mar 29, 2025 Mar 30, 2024 Equity 18% 23% Invested Capital 17% 22% Assets 10% 13% Key Balance Sheet and Cash Flow Statistics Dollars in Millions N E T C A S H (1) with Debt to Capital (2) as of date indicated S O U R C E S / U S E S O F C A S H Cash Flow Type 1Q 2025 1Q 2024 Cash flow from operations $ 55.7 $ 94.2 Capital expenditures $ 1.9 $ 9.3 Free cash flow (3) $ 53.8 $ 84.9 Share repurchases $ 60.4 $ — Dividends paid $ 83.3 $ 83.2 R E T U R N S Trailing 12 months as of date indicated Net cash is defined as cash and cash equivalents of $417.4 million plus short term investments of $56.0 million less outstanding debt of $94.0 million as of March 29, 2025. As of March 30, 2024, net cash was cash and cash equivalents of $467.7 million plus short term investments of $62.8 million less outstanding debt of $65.2 million. Capital is defined as total debt plus total shareholders’ equity. Free cash flow is defined as cash flow from operations less cash capital expenditures. 9% 6%
Frank Lonegro Chief Executive Officer 1Q 2025 2Q Closing Remarks
Ü Current Market Update - April business activity: – Truck Loads: April approximately 2% below April 2024 – Modestly below typical March to April month-to-month historical trends – Truck Revenue per Load: April approximately 1% above April 2024 – Slightly ahead of typical March to April month-to-month historical trends Historical Trends - Pre-pandemic historical seasonality patterns would normally yield: – Truck Revenue: High single-digit sequential step-up from 1Q to 2Q – Truck Loads: 8% sequential increase 1Q to 2Q – Truck Revenue per Load: 2% sequential increase 1Q to 2Q Slide header 2Q Current Market Update and Historical Trends
1Q 2025 Appendix
Revenue Breakdown by Service Type P E R C E N T A G E O F R E V E N U E 1Q 2 0 2 5 by Service Type LTL — 2% T R U C K L O A D Van — 52%, Unsided/Platform — 29% OTHER TRUCK — 8% T R U C K T R A N S P O R T A T I O N RAIL INTERMODAL — 2% OCEAN / AIR CARGO — 6% CHANGE IN SHARE SINCE 1Q 2024 Van Equipment Unsided/ Platform Equipment LTL Other Truck Transportation Rail Intermodal Ocean/ Air cargo All Other 54% Ü 52% 29% Ü 29% 2% Ü 2% 6% Ü 8% 2% Ü 2% 5% Ü 6% 2% Ü 2% ALL OTHER — 2%
U N S I D E D / P L A T F O R M V A N Truckload Loadings and Revenue per Truckload Trends NUMBER OF LOADS REVENUE PER LOAD NUMBER OF LOADS REVENUE PER LOAD
Reconciliation of Gross Profit to Variable Contribution Dollars in Thousands Includes costs of revenue incurred related to internally developed software including ASC 350-40 amortization, implementation costs, hosting costs and other support costs utilized to support the Company’s independent commission sales agents, third party capacity providers, and customers, included as a portion of depreciation and amortization and of selling, general and administrative in the Company's Consolidated Statements of Income. Primarily includes (i) insurance premiums paid for commercial auto liability, general liability, cargo and other lines of coverage related to the transportation of freight; (ii) the related cost of claims incurred under those programs; and (iii) brokerage commissions and other fees incurred relating to the administration of insurance programs available to BCO Independent Contractors that are reinsured by the Company, which are included in selling, general and administrative in the Company’s Consolidated Statements of Income. 2010 2011 2009 % Proj % Plan % External Revenue #REF! #REF! #REF! Purchased Transportation 0 #REF! 0 #REF! #REF! #REF! Commissions to Agents 0 #REF! 0 #REF! #REF! #REF! Net Revenue #REF! #REF! #REF! #REF! #REF! #REF! Investment Income 0 #REF! #VALUE! #VALUE! #REF! 1.1% Other Operating Costs #REF! #REF! #REF! #REF! #REF! #REF! Insurance Expense #REF! #REF! #REF! #REF! #REF! #REF! SG&A #REF! #REF! #REF! #REF! #REF! #REF! Depreciation and Amortization #REF! #REF! #REF! #REF! #REF! #REF! Operating Income #REF! #REF! #REF! #REF! #REF! #REF! Interest and Debt Expense #REF! #REF! #REF! Income Before Income Taxes #REF! #REF! #REF! Income Taxes #REF! #REF! #REF! Net Income #REF! #REF! #REF! Diluted Earnings per Share Shares Diluted Earnings per Share % of 2013 % of 2013 % of Fiscal Years Ended Thirteen Weeks Ended December 25, December 26, March 29, March 30, 2021 2020 2025 2024 2012 Rev/GP Plan Rev/GP Proj Rev/GP Revenue $6,537,568 $4,132,981 $1,152,502 $1,171,043 External Revenue #REF! #REF! #REF! Costs of revenue: Purchased Transportation #REF! #REF! #REF! #REF! #REF! #REF! Purchased transportation 5,114,667 3,192,850 ,897,878 ,905,521 Commissions to agents ,507,209 ,340,780 93,314 97,282 Variable costs of revenue 5,621,876 3,533,630 ,991,192 1,002,803 Interest and Debt Expense #REF! #REF! #REF! Income Before Income Taxes #REF! #REF! #REF! Trailing equipment depreciation 35,204 34,892 6,977 6,897 Information technology costs (1) 13,560 9,791 3,675 5,804 Insurance-related costs (2) ,109,387 90,778 40,524 26,778 Income Taxes #REF! #REF! #REF! Other operating costs 36,531 30,463 11,829 14,859 Other costs of revenue ,194,682 ,165,924 63,005 54,338 Total costs of revenue 5,816,558 3,699,554 1,054,197 1,057,141 Gross profit $,721,010 $,433,427 $98,305 $,113,902 Gross profit margin 0.11028718936460775 0.10487031031596807 8.5% 9.7% Plus: other costs of revenue ,194,682 ,165,924 63,005 54,338 Variable contribution $,915,692 $,599,351 $,161,310 $,168,240 Variable contribution margin 0.14006615304039668 0.14501663569225215 0.13996504995219097 0.14366679959659892 (1) Includes costs of revenue incurred related to internally developed software including ASC 350-40 amortization, implementation costs, hosting costs and other support costs utilized to support the Company’s independent commission sales agents, third party capacity providers, and customers, included as a portion of depreciation and amortization and of selling, general and administrative in the Company's Consolidated Statements of Income. (2) Primarily includes (i) insurance premiums paid for commercial auto liability, general liability, cargo and other lines of coverage related to the transportation of freight; (ii) the related cost of claims incurred under those programs; and (iii) brokerage commissions and other fees incurred relating to the administration of insurance programs available to BCO Independent Contractors that are reinsured by the Company, which are included in selling, general and administrative in the Company’s Consolidated Statements of Income. 2010 2011 2009 % Proj % Plan % External Revenue #REF! #REF! #REF! Purchased Transportation 0 #REF! 0 #REF! #REF! #REF! Commissions to Agents 0 #REF! 0 #REF! #REF! #REF! Net Revenue #REF! #REF! #REF! #REF! #REF! #REF! Investment Income 0 #REF! #VALUE! #VALUE! #REF! 1.1% Other Operating Costs #REF! #REF! #REF! #REF! #REF! #REF! Insurance Expense #REF! #REF! #REF! #REF! #REF! #REF! SG&A #REF! #REF! #REF! #REF! #REF! #REF! Depreciation and Amortization #REF! #REF! #REF! #REF! #REF! #REF! Operating Income #REF! #REF! #REF! #REF! #REF! #REF! Interest and Debt Expense #REF! #REF! #REF! Income Before Income Taxes #REF! #REF! #REF! Income Taxes #REF! #REF! #REF! Net Income #REF! #REF! #REF! Diluted Earnings per Share Shares Diluted Earnings per Share % of 2013 % of 2013 % of Fiscal Years Ended Thirteen Weeks Ended December 25, December 26, March 29, March 30, 2021 2020 2025 2024 2012 Rev/GP Plan Rev/GP Proj Rev/GP Revenue $6,537,568 $4,132,981 $1,152,502 $1,171,043 External Revenue #REF! #REF! #REF! Costs of revenue: Purchased Transportation #REF! #REF! #REF! #REF! #REF! #REF! Purchased transportation 5,114,667 3,192,850 ,897,878 ,905,521 Commissions to agents ,507,209 ,340,780 93,314 97,282 Variable costs of revenue 5,621,876 3,533,630 ,991,192 1,002,803 Interest and Debt Expense #REF! #REF! #REF! Income Before Income Taxes #REF! #REF! #REF! Trailing equipment depreciation 35,204 34,892 6,977 6,897 Information technology costs (1) 13,560 9,791 3,675 5,804 Insurance-related costs (2) ,109,387 90,778 40,524 26,778 Income Taxes #REF! #REF! #REF! Other operating costs 36,531 30,463 11,829 14,859 Other costs of revenue ,194,682 ,165,924 63,005 54,338 Total costs of revenue 5,816,558 3,699,554 1,054,197 1,057,141 Gross profit $,721,010 $,433,427 $98,305 $,113,902 Gross profit margin 0.11028718936460775 0.10487031031596807 8.5% 9.7% Plus: other costs of revenue ,194,682 ,165,924 63,005 54,338 Variable contribution $,915,692 $,599,351 $,161,310 $,168,240 Variable contribution margin 0.14006615304039668 0.14501663569225215 0.13996504995219097 0.14366679959659892 (1) Includes costs of revenue incurred related to internally developed software including ASC 350-40 amortization, implementation costs, hosting costs and other support costs utilized to support the Company’s independent commission sales agents, third party capacity providers, and customers, included as a portion of depreciation and amortization and of selling, general and administrative in the Company's Consolidated Statements of Income. (2) Primarily includes (i) insurance premiums paid for commercial auto liability, general liability, cargo and other lines of coverage related to the transportation of freight; (ii) the related cost of claims incurred under those programs; and (iii) brokerage commissions and other fees incurred relating to the administration of insurance programs available to BCO Independent Contractors that are reinsured by the Company, which are included in selling, general and administrative in the Company’s Consolidated Statements of Income.
Free Cash Flow with Stock Purchases and Dividends Dollars and Shares in Millions 5 – Y E A R S U M M A R Y Cash Flow Item 2020 2021 2022 2023 2024 Cash flow from operations $ 211 $ 277 $ 623 $ 394 $ 287 Cash capital expenditures(1) $ 34 $ 24 $ 26 $ 26 $ 31 Free cash flow $ 177 $ 253 $ 597 $ 368 $ 256 Share repurchases $ 116 $ 123 $ 286 $ 54 $ 81 Dividends paid $ 110 $ 112 $ 116 $ 117 $ 120 Common share count(2) 38.4 37.7 35.9 35.7 35.3 Cash capital expenditures includes purchases of operating property and, for fiscal year 2020, consideration paid for acquisition of a business. Common share count as of the end of the applicable period.
DOT Accident (1) Frequency per Million Miles Traveled by BCOs 5 – Y E A R S U M M A R Y A “DOT Accident” is defined, consistent with U.S. 49 CFR 390.5T, as an occurrence involving a commercial motor vehicle operating on a highway in interstate or intrastate commerce that results in a fatality, a bodily injury to a person who, as a result of the injury, immediately receives medical treatment away from the scene of the accident, or one or more motor vehicles incurring disabling damage as a result of the accident, requiring the motor vehicle(s) to be transported away from the scene by a tow truck or by other motor vehicle, but does not include an occurrence involving only boarding and alighting from a stationary motor vehicle or an occurrence involving only the loading or unloading of cargo.
Date Landstar System, Inc. Earnings Conference Call 1Q 2025