Ryder System Inc 10-Q for FY2020 Q3

Ryder System Inc (R)

10-Q 2020-10-28 For: 2020-09-30

Added on April 10, 2026

About this 10-Q

Ryder System Inc filed this 10-Q on October 28, 2020, covering the quarter ended September 30, 2020 (FY2020 Q3).

Headline figures

Quarter ended September 30, 2020, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.15B; down 3.3% from $2.22B a year earlier
Net income: $35.83M; compared with a net loss of $91.46M a year earlier
Diluted EPS: $0.68; compared with -$1.75 a year earlier

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Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	R	New York Stock Exchange



		Page No.

PART I . FINANCIAL INFORMATION

ITEM 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Earnings	1

	Condensed Consolidated Statements of Comprehensive Income	2

	Condensed Consolidated Balance Sheets	3

	Condensed Consolidated Statements of Cash Flows	4

	Condensed Consolidated Statements of Shareholders' Equity	5

	Notes to Condensed Consolidated Financial Statements	7

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	56

ITEM 4.	Controls and Procedures	56

PART II . OTHER INFORMATION

ITEM 1.	Legal Proceedings	57

ITEM 1A.	Risk Factors	57

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	59







ITEM 6.	Exhibits	60

SIGNATURE		61


	Three months ended September 30,				Nine months ended September 30,
	2020		2019		2020		2019
	(In thousands, except per share amounts)
Lease & related maintenance and rental revenues	$	933,771	$	959,189	$	2,730,187	$	2,792,581
Services revenue	1,120,544		1,120,900		3,174,999		3,412,048
Fuel services revenue	96,260		143,843		301,977		444,623
Total revenues	2,150,575		2,223,932		6,207,163		6,649,252

Cost of lease & related maintenance and rental	758,351		877,767		2,351,993		2,229,596
Cost of services	932,510		948,087		2,680,292		2,896,182
Cost of fuel services	92,930		140,247		291,359		431,885
Other operating expenses	30,009		28,924		93,423		92,213
Selling, general and administrative expenses	211,183		216,037		643,866		673,778
Non-operating pension costs	7,200		6,885		9,357		20,060
Used vehicle sales, net	(12,919)		22,734		17,253		49,091
Interest expense	62,608		62,475		192,459		178,570
Miscellaneous (income) loss, net	(10,552)		676		(11,830)		(29,457)
Restructuring and other items, net	24,490		11,360		92,637		27,374
	2,095,810		2,315,192		6,360,809		6,569,292

Earnings (loss) from continuing operations before income taxes	54,765		(91,260)		(153,646)		79,960
Provision for (benefit from) income taxes	9,680		278		(15,897)		50,156
Earnings (loss) from continuing operations	45,085		(91,538)		(137,749)		29,804
Earnings (loss) from discontinued operations, net of tax	(9,251)		83		(10,129)		(728)
Net earnings (loss)	$	35,834	$	(91,455)	$	(147,878)	$	29,076

Earnings (loss) per common share — Basic
Continuing operations	$	0.86	$	(1.75)	$	(2.64)	$	0.56
Discontinued operations	(0.18)		—		(0.20)		(0.02)
Net earnings (loss)	$	0.68	$	(1.75)	$	(2.83)	$	0.55

Earnings (loss) per common share — Diluted
Continuing operations	$	0.85	$	(1.75)	$	(2.64)	$	0.56
Discontinued operations	(0.17)		—		(0.20)		(0.02)
Net earnings (loss)	$	0.68	$	(1.75)	$	(2.83)	$	0.55


	Three months ended September 30,				Nine months ended September 30,
	2020		2019		2020		2019
	(In thousands)

Net earnings (loss)	$	35,834	$	(91,455)	$	(147,878)	$	29,076

Other comprehensive income (loss):








Changes in currency translation adjustment and other	32,767		(21,812)		(43,975)		(13,813)

Amortization of pension and postretirement items (1)	13,796		7,735		28,946		22,580

Income tax expense related to amortization of pension and postretirement items	(3,300)		(1,689)		(6,405)		(5,084)
Amortization of pension and postretirement items, net of taxes	10,496		6,046		22,541		17,496


Change in net actuarial loss and prior service cost	(89,627)		—		(94,166)		(9,440)
Income tax benefit related to change in net actuarial loss and prior service cost	21,286		—		22,373		2,237
Change in net actuarial loss and prior service cost, net of taxes	(68,341)		—		(71,793)		(7,203)

Other comprehensive income (loss), net of taxes	(25,078)		(15,766)		(93,227)		(3,520)

Comprehensive income (loss)	$	10,756	$	(107,221)	$	(241,105)	$	25,556


	September 30, 2020		December 31, 2019
	(In thousands, except share amounts)
Assets:
Current assets:
Cash and cash equivalents	$	684,248	$	73,584
Receivables, net	1,156,236		1,228,490
Inventories	60,587		80,822
Prepaid expenses and other current assets	131,783		179,155
Total current assets	2,032,854		1,562,051
Revenue earning equipment, net	9,082,580		10,427,664
Operating property and equipment, net of accumulated depreciation of $1,196,874 and $1,224,216, respectively	913,387		917,799
Goodwill	474,748		475,025
Intangible assets, net	44,945		50,905
Sales-type leases and other assets	1,093,522		1,041,890
Total assets	$	13,642,036	$	14,475,334

Liabilities and shareholders’ equity:
Current liabilities:
Short-term debt and current portion of long-term debt	$	1,133,396	$	1,154,564
Accounts payable	461,653		594,712
Accrued expenses and other current liabilities	923,586		876,077
Total current liabilities	2,518,635		2,625,353
Long-term debt	6,303,176		6,770,224
Other non-current liabilities	1,569,961		1,442,003
Deferred income taxes	1,099,706		1,161,444
Total liabilities	11,491,478		11,999,024

Commitments and contingencies (Note 17)
Shareholders’ equity:
Preferred stock, no par value per share — authorized, 3,800,917; none outstanding, September 30, 2020 and December 31, 2019	—		—
Common stock, $0.50 par value per share — authorized, 400,000,000; outstanding, September 30, 2020 — 53,889,123 and December 31, 2019 — 53,278,316	26,944		26,639
Additional paid-in capital	1,124,959		1,108,649
Retained earnings	1,928,373		2,177,513
Accumulated other comprehensive loss	(929,718)		(836,491)
Total shareholders’ equity	2,150,558		2,476,310
Total liabilities and shareholders’ equity	$	13,642,036	$	14,475,334


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Three months ended September 30, 2020
	Preferred Stock		Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss
	Amount		Shares	Par								Total
	(In thousands, except share amounts)
Balance at July 1, 2020	$	—	53,818,841	$	26,909	$	1,113,883	$	1,922,940	$	(904,640)	$	2,159,092

Comprehensive income (loss)	—		—	—		—		35,834		(25,078)		10,756
Common stock dividends declared —$0.56 per share	—		—	—		—		(30,401)		—		(30,401)
Common stock issued under employee stock award and stock purchase plans (1)	—		70,382	35		2,692		—		—		2,727
Benefit plan stock sales (purchases) (2)	—		(100)	—		(5)		—		—		(5)

Share-based compensation	—		—	—		8,389		—		—		8,389
Balance at September 30, 2020	$	—	53,889,123	$	26,944	$	1,124,959	$	1,928,373	$	(929,718)	$	2,150,558


	Three months ended September 30, 2019
	Preferred Stock		Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss
	Amount		Shares	Par								Total
	(In thousands, except share amounts)
Balance at July 1, 2019	$	—	53,334,512	$	26,667	$	1,094,807	$	2,385,620	$	(899,388)	$	2,607,706
Comprehensive income (loss)	—		—	—		—		(91,455)		(15,766)		(107,221)
Common stock dividends declared —$0.56 per share	—		—	—		—		(29,886)		—		(29,886)
Common stock issued under employee stock award and stock purchase plans (1)	—		20,238	29		2,811		—		—		2,840
Benefit plan stock sales (purchases) (2)	—		(10)	—		(1)		—		—		(1)
Common stock repurchases	—		(62,695)	(31)		(1,252)		(1,923)		—		(3,206)
Share-based compensation	—		—	—		6,755		—		—		6,755

Balance at September 30, 2019	$	—	53,292,045	$	26,665	$	1,103,120	$	2,262,356	$	(915,154)	$	2,476,987


	Nine months ended September 30, 2020
	Preferred Stock		Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss
	Amount		Shares	Par								Total
	(In thousands, except share amounts)
Balance at January 1, 2020	$	—	53,278,316	$	26,639	$	1,108,649	$	2,177,513	$	(836,491)	$	2,476,310
Adoption of Measurement of Credit Losses on Financial Instruments standard (See Note 2)	—		—	—		—		(5,077)		—		(5,077)
Comprehensive income (loss)	—		—	—		—		(147,878)		(93,227)		(241,105)
Common stock dividends declared —$1.68 per share	—		—	—		—		(90,627)		—		(90,627)
Common stock issued under employee stock option and stock purchase plans (1)	—		913,785	457		3,483		—		—		3,940
Benefit plan stock sales (purchases) (2)	—		120	—		22		—		—		22
Common stock repurchases	—		(303,098)	(152)		(6,214)		(5,558)		—		(11,924)
Share-based compensation	—		—	—		19,019		—		—		19,019
Balance at September 30, 2020	$	—	53,889,123	$	26,944	$	1,124,959	$	1,928,373	$	(929,718)	$	2,150,558


	Nine months ended September 30, 2019
	Preferred Stock		Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss
	Amount		Shares	Par								Total
	(In thousands, except share amounts)
Balance at January 1, 2019	$	—	53,116,485	$	26,559	$	1,084,391	$	2,337,252	$	(911,634)	$	2,536,568
Comprehensive income (loss)	—		—	—		—		29,076		(3,520)		25,556
Common stock dividends declared —$1.64 per share	—		—	—		—		(87,942)		—		(87,942)
Common stock issued under employee stock option and stock purchase plans (1)	—		583,329	310		5,246		—		—		5,556
Benefit plan stock sales (purchases) (2)	—		40	—		(2)		—		—		(2)
Common stock repurchases	—		(407,809)	(204)		(8,192)		(16,030)		—		(24,426)
Share-based compensation	—		—	—		21,677		—		—		21,677

Balance at September 30, 2019	$	—	53,292,045	$	26,665	$	1,103,120	$	2,262,356	$	(915,154)	$	2,476,987


	Three months ended September 30, 2020
	FMS		SCS		DTS		Eliminations		Total
	(In thousands)
United States	$	1,167,900	$	581,858	$	299,680	$	(127,316)	$	1,922,122
Canada	67,321		56,313		—		(4,421)		119,213
Europe	61,996		—		—		—		61,996
Mexico	—		47,244		—		—		47,244

Total Revenues	$	1,297,217	$	685,415	$	299,680	$	(131,737)	$	2,150,575



	September 30, 2020		December 31, 2019
	(In thousands)
Trade	$	1,032,337	$	1,060,298
Sales-type leases	126,657		135,353
Other, primarily warranty and insurance	42,635		55,600
	1,201,629		1,251,251
Allowance for credit losses and other	(45,393)		(22,761)
Total	$	1,156,236	$	1,228,490




Balance at December 31, 2019	$	10,500
Charges to provisions for credit losses	35,000
Impact of adoption of new accounting standard, write-offs, and other	(11,200)
Balance at September 30, 2020	34,300
Allowance for billing adjustments	11,093
Allowance for credit losses and other	$	45,393


	September 30, 2020						December 31, 2019
	Cost		Accumulated Depreciation		Net Book Value (1)		Cost		Accumulated Depreciation		Net Book Value (1)
	(In thousands)
Held for use:
ChoiceLease	$	11,436,263	$	(4,271,752)	$	7,164,511	$	12,223,179	$	(4,125,342)	$	8,097,837
Commercial rental	2,721,200		(981,959)		1,739,241		3,200,403		(1,049,850)		2,150,553
Held for sale	885,325		(706,497)		178,828		748,435		(569,161)		179,274
Total	$	15,042,788	$	(5,960,208)	$	9,082,580	$	16,172,017	$	(5,744,353)	$	10,427,664


	Three months ended September 30,				Nine months ended September 30,
	2020		2019		2020		2019
	(In thousands)
Automotive	$	273,589	$	246,627	$	671,263	$	761,593
Technology and healthcare	103,976		100,286		279,875		324,009
Consumer package goods and retail	250,449		217,901		716,880		660,581
Industrial and other	57,401		52,786		165,162		156,399
Total SCS Revenues	$	685,415	$	617,600	$	1,833,180	$	1,902,582


	September 30, 2020
	FMS		SCS		DTS		CSS		Total
	(In thousands)
Indefinite lived intangible assets - Trade name	$	—	$	—	$	—	$	8,731	$	8,731



Finite lived intangible assets, primarily customer relationships	57,686		50,249		7,582		—		115,517
Accumulated amortization	(51,109)		(23,574)		(4,620)		—		(79,303)
Total	$	6,577	$	26,675	$	2,962	$	8,731	$	44,945

	December 31, 2019
	FMS		SCS		DTS		CSS		Total
	(In thousands)
Indefinite lived intangible assets - Trade name	$	—	$	—	$	—	$	8,731	$	8,731



Finite lived intangible assets, primarily customer relationships	57,686		50,249		7,582		—		115,517
Accumulated amortization	(49,031)		(20,047)		(4,265)		—		(73,343)
Total	$	8,655	$	30,202	$	3,317	$	8,731	$	50,905


	September 30, 2020						December 31, 2019
	Accrued Expenses		Non-Current Liabilities		Total		Accrued Expenses		Non-Current Liabilities		Total
	(In thousands)
Salaries and wages	$	137,112	$	—	$	137,112	$	126,119	$	—	$	126,119
Deferred compensation	4,638		70,542		75,180		6,436		65,006		71,442
Pension benefits	3,852		436,222		440,074		3,863		413,829		417,692
Other postretirement benefits	1,473		18,893		20,366		1,478		20,187		21,665
Other employee benefits	16,203		—		16,203		21,577		—		21,577
Insurance obligations (1)	170,515		296,997		467,512		163,763		285,838		449,601




Operating taxes	125,668		52,873		178,541		116,003		—		116,003
Income taxes	4,989		16,968		21,957		2,873		17,484		20,357
Interest	51,137		—		51,137		46,032		—		46,032
Deposits, mainly from customers	76,183		3,073		79,256		82,573		3,065		85,638
Operating lease liabilities	74,958		174,964		249,922		72,285		151,361		223,646
Deferred revenue (2)	175,862		446,905		622,767		165,205		438,482		603,687

Restructuring liabilities (3)	11,281		—		11,281		6,765		—		6,765
Other	69,715		52,524		122,239		61,105		46,751		107,856
Total	$	923,586	$	1,569,961	$	2,493,547	$	876,077	$	1,442,003	$	2,318,080


	Weighted Average Interest Rate
	September 30, 2020	Maturities	September 30, 2020		December 31, 2019
			(In thousands)




Debt:
U.S. commercial paper (1)	0.25%	2023	$	55,408	$	511,486
Canadian commercial paper (1)	0.99%	2023	96,040		136,199
Trade receivables program	—%	2021	—		—
Global revolving credit facility	1.25%	2023	800		8,104
Unsecured U.S. notes — Medium-term notes (1)(2)	3.36%	2021-2026	5,770,695		5,965,064
Unsecured U.S. obligations	2.53%	2021-2024	500,000		200,000
Unsecured foreign obligations	1.80%	2021-2024	271,639		270,719
Asset-backed U.S. obligations (3)	2.52%	2020-2026	720,925		807,374
Finance lease obligations and other		2020-2073	47,456		51,717
			7,462,963		7,950,663
Debt issuance costs			(26,391)		(25,875)
Total debt			7,436,572		7,924,788
Short-term debt and current portion of long-term debt			(1,133,396)		(1,154,564)
Long-term debt			$	6,303,176	$	6,770,224



					Total Losses (2)
					Three months ended September 30,				Nine months ended September 30,
	September 30, 2020		December 31, 2019		2020		2019		2020		2019
	(In thousands)
Revenue earning equipment held for sale (1):

Trucks	$	53,736	$	39,009	$	511	$	10,269	$	16,962	$	30,556
Tractors	82,593		73,359		603		14,430		12,091		34,451
Trailers	2,480		2,206		819		1,195		5,404		2,859
Total assets at fair value	$	138,809	$	114,574	$	1,933	$	25,894	$	34,457	$	67,866




Debt Proceeds			Debt Repayments
(In thousands)
Medium-term notes	$	799,648	Medium-term notes	$	1,000,000
Trade receivables program	300,000		Trade receivables program	300,000
U.S. and foreign term loans and other	656,849		U.S. and foreign term loan, finance lease obligations, and other repayments	448,121

Total debt proceeds	$	1,756,497	Total debt repaid	$	1,748,121


	Currency Translation Adjustments		Net Actuarial Loss and Prior Service Costs (1)		Unrealized Gain (Loss) from Cash Flow Hedges		Accumulated Other Comprehensive Loss
	(In thousands)
December 31, 2019	$	(162,243)	$	(667,459)	$	(6,789)	$	(836,491)
Amortization	—		22,541		—		22,541

Other current period change	(33,871)		(71,793)		(10,104)		(115,768)
September 30, 2020	$	(196,114)	$	(716,711)	$	(16,893)	$	(929,718)




	Shares Granted	Weighted-Average Fair Market Value
	(Shares in thousands)


Performance-based restricted stock rights	292		$	37.47






Time-vested restricted stock rights	557		38.45
Total	849		$	38.11


	Three months ended September 30,				Nine months ended September 30,				Change 2020/2019
	2020		2019		2020		2019		Three Months	Nine Months
	(In thousands, except per share amounts)
Total revenue	$	2,150,575	$	2,223,932	$	6,207,163	$	6,649,252	(3)%	(7)%
Operating revenue (1)	1,790,166		1,795,641		5,184,657		5,350,260		—%	(3)%


Earnings (loss) from continuing operations before income taxes (EBT) (2)	$	54,765	$	(91,260)	$	(153,646)	$	79,960	NM	NM
Comparable EBT (2) (3)	77,750		(73,015)		(77,123)		108,780		NM	NM
Earnings (loss) from continuing operations	45,085		(91,538)		(137,749)		29,804		NM	NM
Comparable earnings (loss) from continuing operations (3)	63,821		(78,098)		(57,740)		54,218		NM	NM
Net earnings (loss)	35,834		(91,455)		(147,878)		29,076		NM	NM


Earnings (loss) per common share (EPS) — Diluted
Continuing operations	$	0.85	$	(1.75)	$	(2.64)	$	0.56	NM	NM
Comparable (3)	1.21		(1.49)		(1.11)		1.03		NM	NM
Net earnings (loss)	0.68		(1.75)		(2.83)		0.55		NM	NM


	Proceeds per unit change 2020/2019
	Three Months	Nine Months

Tractors	(11)%	(23)%
Trucks	1%	(4)%


		Three months ended September 30,				Nine months ended September 30,
Description	Classification	2020		2019		2020		2019
		(In thousands)
Restructuring and other, net (1)	Revenue and Restructuring and other items, net	$	(13,767)	$	(5,234)	$	(43,790)	$	(13,757)

ERP implementation costs (1)	Restructuring and other items, net	(5,751)		(6,126)		(27,109)		(13,617)




Gains on sale of properties (1)	Miscellaneous (income) loss, net	3,733		—		3,733		18,614
Other items impacting comparability, net		(15,785)		(11,360)		(67,166)		(8,760)
Non-operating pension costs	Non-operating pension costs	(7,200)		(6,885)		(9,357)		(20,060)
		$	(22,985)	$	(18,245)	$	(76,523)	$	(28,820)


				Change
	September 30, 2020	December 31, 2019	September 30, 2019	Sept 2020/ Dec. 2019	Sept 2020/ Sept 2019
End of period vehicle count
By type:
Trucks (1)	79,400	85,200	86,000	(7)%	(8)%
Tractors (2)	75,400	82,400	82,300	(8)%	(8)%
Trailers (3)	44,000	45,400	45,600	(3)%	(4)%
Other	800	800	1,000	—%	(20)%
Total	199,600	213,800	214,900	(7)%	(7)%

By product line:
ChoiceLease	150,900	159,800	160,200	(6)%	(6)%
Commercial rental	35,400	41,900	44,800	(16)%	(21)%
Service vehicles and other	2,600	2,700	2,600	(4)%	—%
	188,900	204,400	207,600	(8)%	(9)%
Held for sale	10,700	9,400	7,300	14%	47%
Total	199,600	213,800	214,900	(7)%	(7)%



Customer vehicles under SelectCare contracts (4)	55,000	55,800	56,800	(1)%	(3)%


Quarterly average vehicle count
By product line:
ChoiceLease	152,400	160,200	159,000	(5)%	(4)%
Commercial rental	36,000	43,300	45,200	(17)%	(20)%
Service vehicles and other	2,600	2,700	2,700	(4)%	(4)%
	191,000	206,200	206,900	(7)%	(8)%
Held for sale	12,800	8,200	7,700	56%	66%
Total	203,800	214,400	214,600	(5)%	(5)%




Customer vehicles under SelectCare contracts (4)	56,500	56,900	56,400	(1)%	—%
Customer vehicles under SelectCare on-demand (5)	6,200	8,500	8,300	(27)%	(25)%
Total vehicles serviced	266,500	279,800	279,300	(5)%	(5)%

Year-to-date average vehicle count
By product line:
ChoiceLease	156,300	156,600	154,900	—%	1%
Commercial rental	38,200	44,100	44,100	(13)%	(13)%
Service vehicles and other	2,700	2,700	2,700	—%	—%
	197,200	203,400	201,700	(3)%	(2)%
Held for sale	12,000	7,800	7,600	54%	58%
Total	209,200	211,200	209,300	(1)%	—%

Customer vehicles under SelectCare contracts (4)	55,200	56,300	55,500	(2)%	(1)%
Customer vehicles under SelectCare on-demand (5)	15,400	23,200	19,400	(34)%	(21)%
Total vehicle serviced	279,800	290,700	284,200	(4)%	(2)%


	(In millions)

Global revolving credit facility	$	1,248
Trade receivables program	$	300


	Three months ended
	September 30, 2019		December 31, 2019		March 31, 2020		June 30, 2020 (2)		September 30, 2020
	(in millions)
Accelerated Depreciation (2019 - Q2 2020) (1)	$	148	$	88	$	100	$	86	$	33

Policy Depreciation (2019 - Q2 2020)	60		60		51		68		67

Total	$	208	$	148	$	151	$	154	$	100


Non-GAAP Financial Measure			Comparable GAAP Measure
Operating Revenue Measures:
Operating Revenue			Total Revenue
FMS Operating Revenue			FMS Total Revenue
DTS Operating Revenue			DTS Total Revenue
SCS Operating Revenue			SCS Total Revenue
FMS EBT as a % of FMS Operating Revenue			FMS EBT as a % of FMS Total Revenue
SCS EBT as a % of SCS Operating Revenue			SCS EBT as a % of SCS Total Revenue
DTS EBT as a % of DTS Operating Revenue			DTS EBT as a % of DTS Total Revenue
Comparable Earnings Measures:
Comparable Earnings (Loss) Before Income Taxes			Earnings (Loss) Before Income Taxes
Comparable Earnings (Loss)			Earnings (Loss) from Continuing Operations
Comparable EPS			EPS from Continuing Operations
Comparable Tax Rate			Effective Tax Rate from Continuing Operations
Cash Flow Measures:
Total Cash Generated and Free Cash Flow			Cash Provided by Operating Activities


Operating Revenue Measures:
Operating Revenue FMS Operating Revenue SCS Operating Revenue DTS Operating Revenue FMS EBT as a % of FMS Operating Revenue SCS EBT as a % of SCS Operating Revenue DTS EBT as a % of DTS Operating Revenue			Operating revenue is defined as total revenue for Ryder System, Inc. or each business segment (FMS, SCS and DTS) excluding any (1) fuel and (2) subcontracted transportation, as well as (3) revenue from our ChoiceLease liability insurance program which was discontinued in early 2020. We believe operating revenue provides useful information to investors as we use it to evaluate the operating performance of our core businesses and as a measure of sales activity at the consolidated level for Ryder System, Inc., as well as for each of our business segments. We also use segment EBT as a percentage of segment operating revenue for each business segment for the same reason. Note: FMS EBT, SCS EBT and DTS EBT, our primary measures of segment performance, are not non-GAAP measures. Fuel: We exclude FMS, SCS and DTS fuel from the calculation of our operating revenue measures, as fuel is an ancillary service that we provide our customers, which is impacted by fluctuations in market fuel prices and the costs are largely a pass-through to our customers, resulting in minimal changes in our profitability during periods of steady market fuel prices. However, profitability may be positively or negatively impacted by rapid changes in market fuel prices during a short period of time, as customer pricing for fuel services is established based on trailing market fuel costs. Subcontracted transportation: We exclude subcontracted transportation from the calculation of our operating revenue measures, as these services are also typically a pass-through to our customers and, therefore, fluctuations result in minimal changes to our profitability. While our SCS and DTS business segments subcontract certain transportation services to third party providers, our FMS business segment does not engage in subcontracted transportation and, therefore, this item is not applicable to FMS. ChoiceLease liability insurance: We exclude ChoiceLease liability insurance as we announced our plan in the first quarter of 2020 to exit the extension of our liability insurance coverage for ChoiceLease customers. The exit of this program is estimated to be completed in the second quarter of 2021. We are excluding the revenues associated with this program for better comparability of our on-going operations.
Comparable Earnings Measures:
Comparable earnings (loss) before income taxes (EBT) Comparable earnings (loss) Comparable earnings (loss) per diluted common share (EPS) Comparable tax rate			Comparable EBT, comparable earnings, comparable EPS are defined, respectively, as GAAP EBT, earnings, EPS, all from continuing operations, excluding (1) non-operating pension costs and (2) any other significant items that are not representative of our business operations. We believe these comparable earnings measures provide useful information to investors and allow for better year-over-year comparison of operating performance. Non-Operating Pension Costs: Our comparable earnings measures exclude non-operating pension costs, which include the amortization of net actuarial loss and prior service cost, interest cost and expected return on plan assets components of pension and postretirement benefit costs, as well as a settlement or curtailment of a plan. We exclude non-operating pension costs because we consider these to be impacted by financial market performance and outside the operational performance of our business. Other Items Impacting Comparability: Our comparable and adjusted earnings measures also exclude other significant items that are not representative of our business operations as detailed in the reconciliation table below. These other significant items vary from period to period and, in some periods, there may be no such significant items. Calculation of comparable tax rate: The comparable provision for income taxes is computed using the same methodology as the GAAP provision for income taxes. Income tax effects of non-GAAP adjustments are calculated based on the statutory tax rates of the jurisdictions to which the non-GAAP adjustments relate.


Cash Flow Measures:
Total Cash Generated Free Cash Flow			We consider total cash generated and free cash flow to be important measures of comparative operating performance, as our principal sources of operating liquidity are cash from operations and proceeds from the sale of revenue earning equipment. Total Cash Generated: Total cash generated is defined as the sum of (1) net cash provided by operating activities, (2) net cash provided by the sale of revenue earning equipment, (3) net cash provided by the sale of operating property and equipment and (4) other cash inflows from investing activities. We believe total cash generated is an important measure of total cash flows generated from our ongoing business activities. Free Cash Flow: We refer to the net amount of cash generated from operating activities and investing activities (excluding acquisitions) from continuing operations as “free cash flow.” We calculate free cash flow as the sum of (1) net cash provided by operating activities, (2) net cash provided by the sale of revenue earning equipment and operating property and equipment, (3) other cash inflows from investing activities, less (4) purchases of property and revenue earning equipment. We believe free cash flow provides investors with an important perspective on the cash available for debt service and for shareholders, after making capital investments required to support ongoing business operations. Our calculation of free cash flow may be different from the calculation used by other companies and, therefore, comparability may be limited. * See Total Cash Generated and Free Cash Flow reconciliations in the Financial Resources and Liquidity section of Management's Discussion and Analysis.


	EBT				Earnings (Loss)				Diluted EPS
	2020		2019		2020		2019		2020		2019
Three months ended September 30,	(In thousands, except per share amounts)
Continuing operations (GAAP)	$	54,765	$	(91,260)	$	45,085	$	(91,538)	$	0.85	$	(1.75)
Non-operating pension costs	7,200		6,885		4,660		4,919		0.09		0.09
Restructuring and other, net (1)	13,767		5,234		11,186		3,981		0.21		0.08
ERP implementation costs (1)	5,751		6,126		4,269		4,540		0.08		0.09

Gains on sale of properties (1)	(3,733)		—		(3,449)		—		(0.06)		—
Tax adjustments (2)	—		—		2,070		—		0.04		—
Comparable (non-GAAP)	$	77,750	$	(73,015)	$	63,821	$	(78,098)	$	1.21	$	(1.49)

	EBT				Earnings (Loss)				Diluted EPS
	2020		2019		2020		2019		2020		2019
Nine months ended September 30,	(In thousands, except per share amounts)
Continuing operations (GAAP)	$	(153,646)	$	79,960	$	(137,749)	$	29,804	$	(2.64)	$	0.56
Non-operating pension costs	9,357		20,060		4,682		14,263		0.09		0.27
Restructuring and other, net (1)	43,790		13,757		36,223		10,395		0.69		0.21
ERP implementation costs (1)	27,109		13,617		20,120		10,091		0.38		0.19


Gains on sale of properties (1)	(3,733)		(18,614)		(3,449)		(13,843)		(0.06)		(0.26)
Tax adjustments (2)	—		—		22,433		3,508		0.43		0.06


Comparable (non-GAAP)	$	(77,123)	$	108,780	$	(57,740)	$	54,218	$	(1.11)	$	1.03


	Total Number of Shares Purchased (1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs	Maximum Number of Shares That May Yet Be Purchased Under the Anti-Dilutive Program (2)
July 1 through July 31, 2020	46	$	36.63	—	1,196,902
August 1 through August 31, 2020	141	41.61		—	1,196,902
September 1 through September 30, 2020	878	42.02		—	1,196,902
Total	1,065	$	41.73	—


Exhibit Number						Description

31.1						Certification of Robert E. Sanchez pursuant to Rule 13a-14(a) or Rule 15d-14(a)

31.2						Certification of Scott T. Parker pursuant to Rule 13a-14(a) or Rule 15d-14(a)

32						Certification of Robert E. Sanchez and Scott T. Parker pursuant to Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C Section 1350

101.INS						XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document

101.SCH						XBRL Taxonomy Extension Schema Document

101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF						XBRL Taxonomy Extension Definition Linkbase Document

101.LAB						XBRL Taxonomy Extension Label Linkbase Document

101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document

104						Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)


		RYDER SYSTEM, INC.
		(Registrant)

Date:	October 28, 2020	By:	/s/ Scott T. Parker
			Scott T. Parker
			Executive Vice President and Chief Financial Officer
			(Principal Financial Officer)

Date:	October 28, 2020	By:	/s/ Cristina Gallo-Aquino
			Cristina Gallo-Aquino
			Senior Vice President and Controller
			(Principal Accounting Officer)


Date:	October 28, 2020	/s/ Robert E. Sanchez
		Robert E. Sanchez President and Chief Executive Officer


/s/ Scott T. Parker
Scott T. Parker Executive Vice President and Chief Financial Officer
October 28, 2020