Delivers Solid Q2 Results; Continues to
Outperform Prior Cycles
Second Quarter 2024 Highlights
- GAAP EPS from continuing operations of $2.83 compared to
$(0.39) in prior year, which reflected a non-cash FMS U.K. business
exit charge
- Comparable EPS (non-GAAP) from continuing operations of $3.00,
as compared to $3.61 in prior year, reflecting weaker market
conditions in rental and used vehicle sales, partially offset by
higher earnings in contractual lease, supply chain, and dedicated
businesses
- Total revenue of $3.2 billion compared to $2.9 billion in prior
year
- Operating revenue (non-GAAP) of $2.6 billion, up 10%,
reflecting recent acquisitions
Full-Year 2024 Forecast
- Adjusted ROE (ROE) of 16% - 16.5%
- Comparable EPS (non-GAAP) of $11.90 - $12.40
- Operating revenue (non-GAAP) expected to increase by
approximately 8%
- Net cash provided by operating activities from continuing
operations of $2.4 billion and free cash flow (non-GAAP) of
positive $150 - $250 million
Ryder System, Inc. (NYSE: R), a leader in supply chain,
dedicated transportation, and fleet management solutions, reported
results for the three months ended June 30 as follows:
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Ryder is a leader in supply chain,
dedicated transportation, and fleet management solutions. (Photo:
Business Wire)
(In millions, except EPS)
Earnings
Before Taxes
Earnings
Diluted
Earnings
Per Share
2024
2023
2024
2023
2024
2023
Continuing operations (GAAP)
$
178
44
$
126
(18
)
$
2.83
(0.39
)
Comparable (non-GAAP)
$
188
237
$
134
170
$
3.00
3.61
Total and operating revenue for the three months ended June 30
were as follows:
(In millions)
Total Revenue
Operating Revenue
(non-GAAP)
2024
2023
Change
2024
2023
Change
Total
$
3,182
2,884
10%
$
2,561
2,326
10%
Fleet Management Solutions (FMS)
$
1,478
1,459
1%
$
1,276
1,254
2%
Supply Chain Solutions (SCS)
$
1,341
1,179
14%
$
989
865
14%
Dedicated Transportation Solutions
(DTS)
$
635
440
44%
$
485
327
48%
CEO Comment
"Ryder delivered solid second-quarter results and continued to
outperform prior cycles," says Ryder Chairman and CEO Robert
Sanchez. "Comparable EPS were above our forecast primarily
reflecting better-than-expected ChoiceLease results. ROE of 16%
demonstrated the increased resilience of our transformed business
model and is in line with our expectations for the latter stage of
a freight-cycle downturn.
"Our contractual lease, dedicated, and supply chain businesses
generated higher year-over-year earnings. Higher ChoiceLease
results and our maintenance cost-savings initiatives benefited FMS.
Strong automotive performance benefited SCS. In DTS, integration of
the Cardinal Logistics acquisition remains on track and we continue
to expect to achieve planned synergies.
“Long-term secular growth trends remain intact for all of our
contractual businesses, although we are experiencing near-term
sales headwinds that include customer fleet reductions and delayed
decision-making that reflect the extended freight downturn and
overall economic uncertainty. We remain well positioned to grow
with our customers as conditions improve.
"Our strong balance sheet and increased return profile provide
us with ample capacity to support organic growth and strategic
acquisitions as well as return capital to shareholders through
share repurchases and dividends. We recently announced a 14%
increase to our quarterly dividend which demonstrates our continued
confidence in the earnings power of our transformed business
model."
Second Quarter 2024 Segment Review
Fleet Management Solutions: Earnings Reflect Weaker Market
Conditions in Rental and Used Vehicle Sales, Partially Offset by
Higher ChoiceLease Performance
(In millions)
2Q24
2Q23
Change
Total Revenue
$
1,478
1,459
1%
Operating Revenue (1)
$
1,276
1,254
2%
Earnings Before Tax (EBT)
$
133
180
(26)%
EBT as a % of total revenue
9.0%
12.3%
(330) bps
EBT as a % of operating revenue (1)
10.4%
14.4%
(400) bps
(1) Non-GAAP financial measure excluding
fuel services revenue.
- FMS total revenue and operating revenue increased 1% and
2%, respectively.
- Total revenue primarily reflects higher operating revenue
- Operating revenue reflects higher ChoiceLease revenue,
partially offset by lower rental demand
- FMS EBT of $133 million
- Higher ChoiceLease performance and benefits from maintenance
cost-savings initiatives
- Lower used vehicle gains compared to elevated levels in prior
year and weaker rental demand
- Used truck and tractor pricing declined 27% and 19%,
respectively from prior year, and declined 10% for trucks and
increased 5% for tractors, sequentially from first quarter of
2024
- Rental power-fleet utilization was 69%, down from 75% in prior
year on a 11% smaller average power fleet
Supply Chain Solutions: Solid Earnings Reflect Continued
Growth
(In millions)
2Q24
2Q23
Change
Total Revenue
$
1,341
1,179
14%
Operating Revenue (1)
$
989
865
14%
Earnings Before Tax (EBT)
$
85
76
13%
EBT as a % of total revenue
6.4%
6.4%
— bps
EBT as a % of operating revenue (1)
8.6%
8.7%
(10) bps
(1) Non-GAAP financial measure excluding
fuel and subcontracted transportation.
- SCS total revenue and operating revenue both increased
14%
- Total revenue primarily reflects increased operating revenue
and higher subcontracted transportation costs passed through to
customers
- Increase in operating revenue driven by recent acquisitions and
organic growth across all industry verticals
- SCS EBT grew to $85 million
- EBT growth primarily reflects stronger automotive
performance
Dedicated Transportation Solutions: Strong Operating
Performance Partially Offset by Acquisition Costs
(In millions)
2Q24
2Q23
Change
Total Revenue
$
635
440
44%
Operating Revenue (1)
$
485
327
48%
Earnings Before Tax (EBT)
$
37
33
10%
EBT as a % of total revenue
5.8%
7.6%
(180) bps
EBT as a % of operating revenue (1)
7.6%
10.3%
(270) bps
(1) Non-GAAP financial measure excluding
fuel and subcontracted transportation.
- DTS total revenue increased 44% and operating
revenue grew 48%
- Total and operating revenue increased due to the Cardinal
Logistics acquisition
- DTS EBT of $37 million
- Increase due to improved operating performance, partially
offset by Cardinal Logistics acquisition integration and other
related costs
Corporate Financial Information
Tax Rate
Our effective income tax rate from continuing operations was
29.1%, as compared to 140.8% in the prior year, due to the 2023
one-time, nondeductible cumulative currency translation adjustment
loss from the FMS U.K. business exit. Our comparable effective
income tax rate (a non-GAAP measure) from continuing operations,
which excludes the impact of the prior year currency translation
adjustment loss, was 29.0%, consistent with the 28.6% in the prior
year.
Capital Expenditures, Cash Flow, and Leverage
Year-to-date capital expenditures decreased to $1.3 billion in
2024 compared to $1.8 billion in 2023, primarily reflecting reduced
investments in the ChoiceLease fleet due to lower sales
activity.
Year-to-date net cash provided by operating activities from
continuing operations was $1.1 billion compared to $1.2 billion in
2023, primarily reflecting higher working capital needs. Free cash
flow (non-GAAP) of $71 million compared to $16 million in 2023,
reflects reduced capital expenditures partially offset by lower
cash from operating activities and proceeds from sales of used
vehicles and property.
Debt-to-equity as of June 30, 2024 was 245%, compared to 232% at
year-end 2023, and remains below the company's long-term target of
250% to 300%.
Outlook
“Our high-performing contractual portfolio and transformed
business model have enabled us to deliver solid results amid a
challenging freight environment,” says Ryder Chief Financial
Officer John Diez. “The business remains well positioned to benefit
from the expected cycle upturn with ample capacity to fund growth,
pay a reliable dividend, and return capital to shareholders. The
high end of our full-year forecast range continues to assume a
gradual recovery in rental and used vehicle sales in the second
half, while the bottom end reflects ongoing weak conditions. We now
expect to generate higher free cash flow for the year reflecting
lower capital spending due to softer lease sales activity.”
Full
Year 2024
Total Revenue Growth
~8%
Operating Revenue Growth (non-GAAP)
~8%
FY24 GAAP EPS
$11.15 - $11.65
FY24 Comparable EPS (non-GAAP)
$11.90 - $12.40
Adjusted ROE (1)
16% - 16.5%
Net Cash from Operating Activities from
Continuing Operations
~$2.4B
Free Cash Flow (non-GAAP)
$150 - $250M
Capital Expenditures
~$2.9B
Debt-to-Equity
~240%
Third
Quarter 2024
3Q24 GAAP EPS
$3.12 - $3.32
3Q24 Comparable EPS (non-GAAP)
$3.30 - $3.50
————————————
(1) The non-GAAP elements of this
calculation have been reconciled to the corresponding GAAP
measures. A numerical reconciliation of net earnings to adjusted
net earnings and average shareholders' equity to adjusted average
equity is provided in the Appendix - Non-GAAP Financial Measures
Reconciliations at the end of this release.
Supplemental Company Information
Second Quarter Net Earnings
(In millions, except EPS)
Earnings
Diluted EPS
2024
2023
2024
2023
Earnings from continuing operations
$
126
(18
)
$
2.83
(0.39
)
Discontinued operations
1
—
0.01
(0.01
)
Net earnings
$
127
(18
)
$
2.84
(0.40
)
Year-to-Date Operating Results
(In millions, except EPS)
Six months ended June
30,
2024
2023
Change
Total revenue
$
6,279
5,836
8%
Operating revenue (non-GAAP)
$
5,056
4,672
8%
Earnings from continuing operations
$
212
122
73%
Comparable earnings from continuing
operations (non-GAAP)
$
230
303
(24)%
Net earnings
$
212
121
75%
Earnings per common share (EPS) -
Diluted
Continuing operations
$
4.72
2.60
82%
Comparable (non-GAAP)
$
5.13
6.42
(20)%
Net earnings
$
4.73
2.57
83%
Business Description
Ryder System, Inc. is a leading supply chain, dedicated
transportation, and fleet management solutions company. Ryder's
stock (NYSE: R) is a component of the Dow Jones Transportation
Average and the S&P MidCap 400® index. The company's financial
performance is reported in the following three, inter-related
business segments:
- Supply Chain Solutions – Ryder's SCS business segment
optimizes logistics networks to make them more responsive and able
to be leveraged as a competitive advantage. Globally-recognized
brands in the automotive, consumer goods, food and beverage,
healthcare, industrial, oil and gas, technology, and retail
industries rely on Ryder's leading-edge technologies and
world-class logistics engineers to help them deliver the goods that
consumers use every day.
- Dedicated Transportation Solutions – Ryder's DTS
business segment combines the best of Ryder's leasing and
maintenance capabilities with the safest and most professional
drivers in the industry. With a dedicated transportation solution,
Ryder helps customers increase their competitive position, reduce
risk, and integrate their transportation needs with their overall
supply chain.
- Fleet Management Solutions – Ryder's FMS business
segment provides a broad range of services to help businesses of
all sizes, across virtually every industry, deliver for their
customers. From leasing, maintenance, and fueling, to rental and
used vehicle sales, customers rely on Ryder's expertise to help
them lower their costs, redirect capital to other parts of their
business, and focus on what they do best – so they can grow.
For more information on Ryder System, Inc., visit
investors.ryder.com and ryder.com.
Note: Regarding Forward-Looking Statements
Certain statements and information included in this news release
are "forward-looking statements" under the Federal Private
Securities Litigation Reform Act of 1995, including: our forecast;
our outlook; our expectations regarding market trends and economic
environment, such as rental demand, economic growth, challenging
freight environment, weakening used vehicle sales and rental, and
declining volumes in our omnichannel retail vertical; our
expectations regarding the freight cycle, including timing and the
impact of the freight cycle on our businesses; our expectations
regarding total and operating revenue, earnings per share,
comparable earnings per share, adjusted ROE, earnings before income
tax, net cash from operating activities from continuing operations,
debt-to-equity, capital expenditures, operating cash flow and free
cash flow, and the causes of change; our ability to execute our
balanced growth strategy; the impact of inflationary pressures,
such as inflationary cost recovery; our expectations regarding
commercial rental demand and utilization and used vehicle sales
volume and pricing; our expectations regarding long-term profitable
growth and secular growth trends; our expectations with respect to
our actions to increase returns and create long-term value; our
expectations regarding used vehicle inventory and fleet size; our
ability to outperform prior cycles; our ability to support organic
growth, including growing our contractual lease, dedicated, and
supply chain businesses at targeted returns; our expectations
regarding strategic investments and acquisitions, including the
acquisitions of Cardinal Logistics and Impact Fulfillment Services;
and our expectations regarding our ability to return capital to
shareholders, including through share repurchases and dividends.
Our forward-looking statements also include our estimates of the
impact of residual value estimates on earnings and depreciation
expense that is based in part on our current assessment of the
residual values and useful lives of revenue-earning equipment based
on multi-year trends and our outlook for the expected near- and
long-term used vehicle market. A variety of factors, many of which
are outside of our control, could cause residual value estimates to
differ from actual used vehicle sales pricing, such as changes in
supply and demand of used vehicles; volatility in market
conditions; changes in vehicle technology; competitor pricing;
regulatory requirements; driver shortages; customer requirements
and preferences; and changes in underlying assumption factors.
All of our forward-looking statements should be evaluated by
considering the many risks and uncertainties inherent in our
business that could cause actual results and events to differ
materially from those in the forward-looking statements. Important
factors that could cause such differences include: changes in
general economic and financial conditions in the U.S. and
worldwide; the ongoing supply chain and labor challenges and
vehicle production constraints, including original equipment
manufacturer delays; the effect of geopolitical events; our ability
to adapt to changing market conditions, including lower than
expected contractual sales, decreases in commercial rental demand
or utilization, poor acceptance of rental pricing, declining market
demand for or excess supply of used vehicles impacting current or
estimated pricing, and our anticipated proportion of retail versus
wholesale sales; declining customer demand for our services; higher
than expected maintenance costs; lower than expected benefits from
our cost-savings initiatives; our ability to effectively and
efficiently integrate acquisitions into our business; lower than
expected benefits from our sales, marketing, and new product
initiatives; setbacks in the economic market or in our ability to
retain profitable customer accounts; impact of changing laws and
regulations; difficulty in obtaining adequate profit margins for
our services; inability to maintain current pricing levels due to,
for example, economic conditions, business interruptions,
expenditures, labor disputes, and severe weather or other natural
occurrences; competition from other service providers; changes in
technology and new entrants; professional driver and technician
shortages resulting in higher procurement costs and turnover rates;
impact of supply chain disruptions; higher than expected bad debt
reserves or write-offs; decrease in credit ratings; increased debt
costs; adequacy of accounting estimates; our ability to effectively
and efficiently integrate acquisitions into our business; higher
than expected reserves and accruals particularly with respect to
pension, taxes, insurance, and revenue; impact of changes in our
residual value estimates and accounting policies, including our
depreciation policy; unanticipated changes in fuel and alternative
energy prices; unanticipated currency exchange rate fluctuations;
fluctuations in inflation or interest rates; our ability to manage
our cost structure; and the risks described in our filings with the
Securities and Exchange Commission (SEC). The risks included here
are not exhaustive. New risks emerge from time to time, and it is
not possible for management to predict all such risk factors or to
assess the impact of such risks on our business. Accordingly, we
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise.
Note: Regarding Non-GAAP Financial Measures
This news release includes certain non-GAAP financial measures
as defined under SEC rules. Refer to Appendix - Non-GAAP Financial
Measure Reconciliations at the end of the tables following this
press release for reconciliations of the most comparable GAAP
measure to the non-GAAP financial measure and the reasons why
management believes the measure is important to investors.
Additional information regarding non-GAAP financial measures as
required by Regulation G and Item 10(e) of Regulation S-K can be
found in our most recent Form 10-K, Form 10-Q, and Form 8-K filed
with the SEC as of the date of this release, which are available at
investors.ryder.com.
CONFERENCE CALL AND WEBCAST INFORMATION
Ryder’s earnings conference call and webcast is scheduled for
July 25, 2024 at 11:00 a.m. ET. To join, click here.
LIVE AUDIO VIA PHONE
Toll Free Number:
888-394-8218
USA Toll Number:
323-994-2093
Audio Passcode:
Ryder
Conference Leader:
Calene Candela
WEBCAST REPLAY
An audio replay including the slide presentation will be
available within four hours following the call. Click here then
select Financials/Quarterly Results and the date.
ryder-financial
RYDER SYSTEM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
EARNINGS - UNAUDITED
Three months ended June 30,
Six months ended June 30,
(In millions, except per share
amounts)
2024
2023
2024
2023
Services revenue
$
2,114
1,778
4,151
3,599
Lease & related maintenance and rental
revenues
948
976
1,884
1,955
Fuel services revenue
120
130
244
282
Total revenues
3,182
2,884
6,279
5,836
Cost of services
1,793
1,507
3,536
3,114
Cost of lease & related maintenance
and rental
644
661
1,313
1,335
Cost of fuel services
116
126
237
275
Selling, general and administrative
expenses
368
343
746
706
Non-operating pension costs, net
10
10
21
20
Used vehicle sales, net
(19
)
(55
)
(39
)
(127
)
Interest expense
96
72
188
137
Miscellaneous income, net
(4
)
(11
)
(19
)
(31
)
Currency translation adjustment loss
—
188
—
188
Restructuring and other items, net
—
(1
)
4
(26
)
3,004
2,840
5,987
5,591
Earnings from continuing operations before
income taxes
178
44
292
245
Provision for income taxes
52
62
80
123
Earnings (loss) from continuing
operations
126
(18
)
212
122
Earnings (loss) from discontinued
operations, net of tax
1
—
—
(1
)
Net earnings (loss)
$
127
(18
)
$
212
121
Earnings (loss) per common share —
Diluted
Continuing operations
$
2.83
(0.39
)
$
4.72
2.60
Discontinued operations
0.01
(0.01
)
0.01
(0.02
)
Net earnings (loss)
$
2.84
(0.40
)
$
4.73
2.57
Weighted average common shares outstanding
— Diluted
44.6
46.0
44.8
47.2
Diluted EPS from continuing operations
$
2.83
(0.39
)
$
4.72
2.60
Non-operating pension costs, net
0.17
0.17
0.33
0.34
Acquisition costs
0.01
—
0.11
—
FMS U.K. exit
—
(0.09
)
—
(0.39
)
Currency translation adjustment loss
—
3.90
—
3.87
Other, net
(0.01
)
0.02
(0.03
)
—
Comparable EPS from continuing operations
(1)
$
3.00
3.61
$
5.13
6.42
(1) Non-GAAP financial measure. A
reconciliation of GAAP EPS from continuing operations to comparable
EPS from continuing operations is set forth in this table.
Note: Amounts may not be additive due to rounding.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS - UNAUDITED
(In millions)
June 30, 2024
December 31, 2023
Assets:
Cash and cash equivalents
$
164
204
Other current assets
2,207
2,061
Revenue earning equipment, net
8,968
8,892
Operating property and equipment, net
1,208
1,217
Other assets
3,861
3,404
$
16,408
15,778
Liabilities and shareholders' equity:
Current liabilities
$
2,098
2,066
Total debt (including current portion)
7,536
7,114
Other non-current liabilities (including
deferred income taxes)
3,693
3,529
Shareholders' equity
3,081
3,069
$
16,408
15,778
SELECTED KEY RATIOS AND
METRICS
June 30, 2024
December 31, 2023
Debt to equity
245%
232%
Three months ended June 30,
Six months ended June 30,
(In millions)
2024
2023
2024
2023
Comparable EBITDA (1)
$
704
674
$
1,340
1,302
Effective interest rate
5.2
%
4.5
%
5.1
%
4.3
%
Six months ended June 30,
(In millions)
2024
2023
Net cash provided by operating activities
from continuing operations
$
1,078
1,221
Free cash flow (1)
71
16
Capital expenditures paid
1,324
1,652
Gross capital expenditures
1,301
1,813
Twelve months ended June 30,
2024
2023
Adjusted ROE (2)
16%
24%
________________
(1) Non-GAAP financial measure. See
reconciliation of the non-GAAP elements of this calculation
reconciled to the corresponding GAAP measures included in the
Appendix - Non-GAAP Financial Measures section at the end of this
release.
(2) The non-GAAP elements of the calculation have been reconciled
to the corresponding GAAP measures. A numerical reconciliation of
net earnings to adjusted net earnings and average shareholders'
equity to adjusted average equity is provided in the Appendix -
Non-GAAP Financial Measures section at the end of this release.
Note: Amounts may not be additive due to rounding.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
BUSINESS SEGMENT REVENUE AND
EARNINGS - UNAUDITED
Three months ended June 30,
Six months ended June 30,
(In millions)
2024
2023
Change
2024
2023
Change
Total Revenue:
Fleet Management Solutions:
ChoiceLease
$
856
781
10%
$
1,698
1,557
9%
Commercial rental
244
301
(19)%
475
605
(21)%
SelectCare and other
176
172
2%
354
354
—%
Fuel services revenue
202
205
(1)%
406
446
(9)%
Fleet Management Solutions
1,478
1,459
1%
2,933
2,962
(1)%
Supply Chain Solutions
1,341
1,179
14%
2,643
2,380
11%
Dedicated Transportation Solutions
635
440
44%
1,198
894
34%
Eliminations
(272
)
(194
)
(39)%
(495
)
(400
)
(23)%
Total revenue
$
3,182
2,884
10%
$
6,279
5,836
8%
Operating Revenue: (1)
Fleet Management Solutions
$
1,276
1,254
2%
$
2,527
2,516
—%
Supply Chain Solutions
989
865
14%
1,961
1,744
12%
Dedicated Transportation Solutions
485
327
48%
911
649
40%
Eliminations
(189
)
(120
)
(58)%
(343
)
(237
)
(45)%
Operating revenue
$
2,561
2,326
10%
$
5,056
4,672
8%
Business Segment Earnings:
Earnings from continuing operations before
income taxes:
Fleet Management Solutions
$
133
180
(26)%
$
233
362
(35)%
Supply Chain Solutions
85
76
13%
149
93
61%
Dedicated Transportation Solutions
37
33
10%
55
62
(12)%
Eliminations
(34
)
(24
)
39%
(63
)
(49
)
29%
220
265
(17)%
373
468
(20)%
Unallocated Central Support Services
(22
)
(20
)
16%
(35
)
(35
)
4%
Intangible amortization expense
(11
)
(8
)
(26)%
(22
)
(17
)
(26)%
Non-operating pension costs, net
(10
)
(10
)
1%
(21
)
(20
)
1%
Other items impacting comparability,
net
—
(183
)
NM
(4
)
(151
)
NM
Earnings from continuing operations before
income taxes
178
44
311%
292
245
19%
Provision for income taxes
52
62
(16)%
80
123
(35)%
Earnings (loss) from continuing
operations
$
126
(18
)
815%
$
212
122
73%
________________
(1) Non-GAAP financial measure. See
reconciliation of GAAP total revenue to operating revenue in the
Appendix - Non-GAAP Financial Measures section at the end of this
release.
Note: Amounts may not be additive due to rounding.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
BUSINESS SEGMENT REVENUE AND
EARNINGS - UNAUDITED
Three months ended June 30,
Six months ended June 30,
(In millions)
2024
2023
Change
2024
2023
Change
Fleet Management Solutions
FMS total revenue
$
1,478
1,459
1%
$
2,933
2,962
(1)%
Fuel services revenue (1)
(202
)
(205
)
(1)%
(406
)
(446
)
(9)%
FMS operating revenue (2)
$
1,276
1,254
2%
$
2,527
2,516
—%
Segment earnings before income taxes
$
133
180
(26)%
$
233
362
(35)%
FMS earnings before income taxes as % of
FMS total revenue
9.0%
12.3%
8.0%
12.2%
FMS earnings before income taxes as % of
FMS operating revenue (2)
10.4%
14.4%
9.2%
14.4%
Three months ended June 30,
Six months ended June 30,
2024
2023
Change
2024
2023
Change
Supply Chain Solutions
SCS total revenue
$
1,341
1,179
14%
$
2,643
2,380
11%
Subcontracted transportation and fuel
(352
)
(314
)
12%
(682
)
(636
)
7%
SCS operating revenue (2)
$
989
865
14%
$
1,961
1,744
12%
Segment earnings before income taxes
$
85
76
13%
$
149
93
61%
SCS earnings before income taxes as % of
SCS total revenue
6.4%
6.4%
5.7%
3.9%
SCS earnings before income taxes as % of
SCS operating revenue (2)
8.6%
8.7%
7.6%
5.3%
Three months ended June 30,
Six months ended June 30,
2024
2023
Change
2024
2023
Change
Dedicated Transportation
Solutions
DTS total revenue
$
635
440
44%
$
1,198
894
34%
Subcontracted transportation and fuel
(150
)
(113
)
33%
(287
)
(245
)
17%
DTS operating revenue (2)
$
485
327
48%
$
911
649
40%
Segment earnings before income taxes
$
37
33
10%
$
55
62
(12)%
DTS earnings before income taxes as % of
DTS total revenue
5.8%
7.6%
4.6%
7.0%
DTS earnings before income taxes as % of
DTS operating revenue (2)
7.6%
10.3%
6.0%
9.6%
________________
(1) Includes intercompany fuel sales from
FMS to SCS and DTS.
(2) Non-GAAP financial measure. A reconciliation of (1) GAAP total
revenue to operating revenue for each business segment (FMS, SCS
and DTS) and (2) segment earnings before taxes (EBT) as % of
segment total revenue to segment EBT as % of segment operating
revenue for each business segment is set forth in this table.
Note: Amounts may not be additive due to rounding.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
BUSINESS SEGMENT INFORMATION -
UNAUDITED
KEY PERFORMANCE INDICATORS
Our North America fleet of owned and leased revenue earning
equipment and SelectCare vehicles, including vehicles under
on-demand maintenance and used vehicles sold, is summarized as
follows (number of units rounded to the nearest hundred):
Three months ended June 30,
Six months ended June 30,
2024/2023
2024
2023
2024
2023
Three Months
Six Months
ChoiceLease
Average fleet count
146,000
137,800
144,600
136,600
6%
6%
End of period fleet count
145,000
139,000
145,000
139,000
4%
4%
Average active fleet count (1)
137,600
129,700
136,000
129,200
6%
5%
End of period active fleet count (1)
136,800
130,500
136,800
130,500
5%
5%
Commercial rental
Average fleet count
35,500
40,200
35,600
40,700
(12)%
(13)%
End of period fleet count
35,400
39,200
35,400
39,200
(10)%
(10)%
Rental utilization - power units (2)
69
%
75
%
68
%
75
%
(600)bps
(700)bps
Rental rate change - % (3)
—
%
2
%
—
%
3
%
Customer vehicles under SelectCare
contracts
Average fleet count
50,400
52,600
50,800
53,300
(4)%
(5)%
End of period fleet count
48,500
51,700
48,500
51,700
(6)%
(6)%
Customer vehicles under SCS
contracts
End of period fleet count (4)
13,500
13,600
13,500
13,600
(1)%
(1)%
End of period power vehicles (4)
4,100
4,100
4,100
4,100
—%
—%
Customer vehicles under DTS
contracts
End of period fleet count (4)
19,900
11,300
19,900
11,300
76%
76%
End of period power vehicles (4)
7,600
5,300
7,600
5,300
43%
43%
Used vehicle sales (UVS)
End of period fleet count
9,500
7,000
9,500
7,000
36%
36%
Used vehicles sold
6,000
5,500
12,600
10,600
9%
19%
UVS pricing change (5)
Tractors
(19
)%
(41
)%
(27
)%
(38
)%
Trucks
(27
)%
(34
)%
(28
)%
(26
)%
________________
(1) Active fleet count is calculated as
those units currently earning revenue and not classified as not yet
earning or no longer earning units.
(2) Rental utilization is calculated using the number of days units
are rented divided by the number of days units available to rent
based on the days in a calendar year (excluding trailers). (3)
Represents percentage change compared to prior year period in
average rental rate per day on power units using constant currency.
(4) These vehicle counts are also included within the fleet counts
for ChoiceLease, Commercial rental and SelectCare. (5) Represents
percentage change compared to prior year period in average sales
proceeds on used vehicle sales using constant currency.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
This press release and accompanying tables include “non-GAAP
financial measures” as defined by SEC rules. As required by SEC
rules, we provide a reconciliation of each non-GAAP financial
measure to the most comparable GAAP measure. Non-GAAP financial
measures should be considered in addition to, but not as a
substitute for or superior to, other measures of financial
performance prepared in accordance with GAAP.
Specifically, the following non-GAAP
financial measures are included in this press release:
Non-GAAP Financial
Measure
Comparable GAAP
Measure
Reconciliation in Section
Entitled
Operating Revenue Measures:
Operating Revenue
Total Revenue
Appendix - Non-GAAP Financial Measure
Reconciliations
FMS Operating Revenue
FMS Total Revenue
Business Segment Information -
Unaudited
SCS Operating Revenue
SCS Total Revenue
DTS Operating Revenue
DTS Total Revenue
Operating Revenue Growth
Total Revenue Growth
Appendix - Non-GAAP Financial Measure
Reconciliations
FMS EBT as a % of FMS Operating
Revenue
FMS EBT as a % of FMS Total Revenue
Business Segment Information -
Unaudited
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 Before Income Tax and
Comparable Tax Rate
Earnings Before Income Tax and Effective
Tax Rate from Continuing Operations
Appendix - Non-GAAP Financial Measure
Reconciliations
Comparable Earnings
Earnings from Continuing Operations
Appendix - Non-GAAP Financial Measure
Reconciliations
Comparable EPS
EPS from Continuing Operations
Condensed Consolidated Statements of
Earnings - Unaudited
Appendix - Non-GAAP Financial Measure
Reconciliations
Adjusted Return on Equity (ROE)
Not Applicable. However, the non-GAAP
elements of the calculation have been reconciled to the
corresponding GAAP measures. A numerical reconciliation of net
earnings to adjusted net earnings and average shareholders' equity
to adjusted average equity is provided in the following
reconciliations.
Appendix - Non-GAAP Financial Measure
Reconciliations
Comparable Earnings Before Interest,
Taxes, Depreciation and Amortization
Net Earnings
Appendix - Non-GAAP Financial Measure
Reconciliations
Cash Flow Measures:
Total Cash Generated and Free Cash
Flow
Cash Provided by Operating Activities from
Continuing Operations
Appendix - Non-GAAP Financial Measure
Reconciliations
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
Set forth in the table below is an overview of each non-GAAP
financial measure and why management believes that presentation of
each non-GAAP financial measure provides useful information to
investors. See reconciliations for each of these measures following
this table.
Operating Revenue Measures:
Operating Revenue
FMS Operating Revenue
SCS Operating Revenue
DTS Operating Revenue
Operating Revenue Growth
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 or each
business segment (FMS, SCS and DTS) excluding any (1) fuel and (2)
subcontracted transportation. We use operating revenue 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. Fuel revenue 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 current 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.
Comparable Earnings Measures:
Comparable Earnings before Income Taxes
(EBT)
Comparable Earnings
Comparable Earnings per Diluted Common
Share (EPS)
Comparable Tax Rate
Adjusted Return on Equity (ROE)
Comparable EBT,
Comparable Earnings and Comparable EPS are defined,
respectively, as GAAP EBT, earnings and EPS, all from continuing
operations, excluding (1) non-operating pension costs, net and (2)
other items impacting comparability (as further described below).
We believe these non-GAAP measures provide useful information to
investors and allow for better year-over-year comparison of
operating performance.
Non-operating pension costs, net: Our
comparable earnings measures exclude non-operating pension costs,
net, 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
any significant charges for settlements or curtailments if
recognized. We exclude non-operating pension costs, net 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 and vary from period to period.
Comparable Tax
Rate 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 marginal tax rates to which
the non-GAAP adjustments are related.
Adjusted ROE
is defined as adjusted net earnings divided by adjusted average
shareholders' equity and represents the rate of return on
shareholders' investment. Other items impacting comparability
described above are excluded, as applicable, from the calculation
of adjusted net earnings and adjusted average shareholders' equity.
We also exclude any significant charges for pension settlements or
curtailments from the calculation of adjusted net earnings. We use
adjusted ROE as an internal measure of how effectively we use the
owned capital invested in our operations.
Comparable Earnings Before Interest,
Taxes, Depreciation and Amortization (EBITDA)
Comparable
EBITDA is defined as net earnings, first adjusted to exclude
discontinued operations and the following items, all from
continuing operations: (1) non-operating pension costs, net and (2)
any other items that are not representative of our business
operations (these items are the same items that are excluded from
comparable earnings measures for the relevant periods as described
immediately above) and then adjusted further for (1) interest
expense, (2) income taxes, (3) depreciation, (4) used vehicle sales
results and (5) amortization.
We believe comparable EBITDA provides
investors with useful information, as it is a standard measure
commonly reported and widely used by investors and other interested
parties to measure financial performance and our ability to service
debt and meet our payment obligations. We believe that the
inclusion of comparable EBITDA also provides consistency in
financial reporting and aids investors in performing meaningful
comparisons of past, present and future operating results. Our
presentation of comparable EBITDA may not be comparable to
similarly-titled measures used by other companies.
Comparable EBITDA should not be considered
a substitute for, or superior to, the measures of financial
performance determined in accordance with GAAP.
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 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 is defined as the net amount of cash generated from
operating activities and investing activities (excluding
acquisitions) from continuing operations. 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, and (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.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
OPERATING REVENUE
RECONCILIATION
Three months ended June 30,
Six months ended June 30,
(In millions)
2024
2023
2024
2023
Total revenue
$
3,182
2,884
$
6,279
5,836
Subcontracted transportation and fuel
(621
)
(558
)
(1,223
)
(1,164
)
Operating revenue (1)
$
2,561
2,326
$
5,056
4,672
TOTAL CASH
GENERATED / FREE CASH FLOW RECONCILIATION
Six months ended June 30,
(In millions)
2024
2023
Net cash provided by operating activities
from continuing operations
$
1,078
1,221
Proceeds from sales (primarily revenue
earning equipment) (2)
317
447
Total cash generated (1)
1,395
1,668
Purchases of property and revenue earning
equipment (2)
(1,324
)
(1,652
)
Free cash flow (1)
$
71
16
________________
(1) Non-GAAP financial measure.
(2) Included in cash flows from investing
activities
Note: Amounts may not be additive due to
rounding.
COMPARABLE
EARNINGS RECONCILIATION
Three months ended June 30,
Six months ended June 30,
(In millions)
2024
2023
2024
2023
Earnings (loss) from continuing
operations
$
126
(18
)
$
212
122
Non-operating pension costs, net
7
8
15
16
Acquisition costs
1
—
5
—
FMS U.K. exit
—
(4
)
—
(18
)
Currency translation adjustment loss
—
183
—
183
Other, net
—
1
(2
)
—
Comparable earnings from continuing
operations (1) (2)
$
134
170
$
230
303
Tax rate on continuing operations
29.1%
140.8%
27.7%
50.0%
Tax adjustments and income tax effects of
non-GAAP adjustments (2)
(0.1)%
(112.2)%
(0.3)%
(22.7)%
Comparable tax rate on continuing
operations (2)
29.0%
28.6%
27.4%
27.3%
________________
(1) 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 marginal tax rates to which the non-GAAP
adjustments are related.
(2) Non-GAAP financial measure. Note: Amounts may not be
additive due to rounding.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
ADJUSTED RETURN
ON EQUITY RECONCILIATION
Twelve months ended June 30,
(Dollars in millions)
2024
2023
Net earnings
$
495
574
Other items impacting comparability
10
96
Tax impact (1)
(6
)
38
Adjusted net earnings
$
499
708
Average shareholders' equity
$
3,082
2,976
Average adjustments to shareholders'
equity (2)
(7
)
(19
)
Adjusted average shareholders' equity
$
3,075
2,957
Adjusted return on equity (3)
16%
24%
________________
(1) Represents income taxes on other items
impacting comparability.
(2) Represents the impact of other items impacting comparability,
net of tax, to equity for the respective periods. (3) Adjusted
return on equity is calculated by dividing Adjusted net earnings
into Adjusted average shareholders' equity.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
COMPARABLE EARNINGS BEFORE INCOME TAXES /
COMPARABLE EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND
AMORTIZATION RECONCILIATION
Three months ended June 30,
Six months ended June 30,
(In millions)
2024
2023
2024
2023
Net earnings (loss)
$
127
(18
)
$
212
121
(Earnings) loss from discontinued
operations, net of tax
(1
)
—
—
1
Provision for income taxes
52
62
80
123
EBT
178
44
292
245
Non-operating pension costs, net
10
10
21
20
Acquisition costs
1
—
6
—
FMS U.K. exit, primarily net commercial
claim proceeds
—
(5
)
—
(36
)
Currency translation adjustment loss
—
188
—
188
Other, net
(1
)
—
(2
)
(1
)
Comparable EBT (1)
188
237
317
416
Interest expense
96
72
188
137
Depreciation
428
412
852
857
Used vehicle sales, net
(19
)
(55
)
(39
)
(125
)
Amortization
11
8
22
17
Comparable EBITDA
$
704
674
$
1,340
1,302
________________
(1) Non-GAAP financial measure. Non-GAAP
elements of the calculation have been reconciled to the
corresponding GAAP measures. A numerical reconciliation of earnings
before income taxes from continuing operations to comparable
earnings before income taxes from continuing operations is set
forth in this table.
Note: Amounts may not be additive due to rounding.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
OPERATING REVENUE
GROWTH FORECAST RECONCILIATION
(In millions)
Twelve months ended December
31,
2024
2023
Change
Total revenue
$
12,700
11,783
8%
Subcontracted transportation and fuel
(2,400
)
(2,286
)
5%
Operating revenue (1)
$
10,300
9,497
8%
COMPARABLE
EARNINGS PER SHARE FORECAST RECONCILIATION
(In millions, except per share
amounts)
Third Quarter 2024
Full Year 2024
EPS from continuing operations
$3.12 - $3.32
$11.15 - $11.65
Non-operating pension costs
0.19
0.74
Restructuring and other, net
(0.01
)
0.02
Comparable EPS from continuing operations
forecast (1)
$3.30 - $3.50
$11.90 - $12.40
TOTAL CASH
GENERATED / FREE CASH FLOW FORECAST RECONCILIATION
(In millions)
2024 Forecast
Net cash provided by operating activities
from continuing operations
$
2,400
Proceeds from sales (primarily revenue
earning equipment) (2)
600
Total cash generated (1)
3,000
Purchases of property and revenue earning
equipment (2) (3)
(2,800
)
Free cash flow (1)
$
200
________________
(1) Non-GAAP financial measure.
(2) Included in cash flows from investing activities. (3) Amount
updated to correct typographical error.
RYDER SYSTEM, INC. AND
SUBSIDIARIES
APPENDIX - NON-GAAP FINANCIAL
MEASURE RECONCILIATIONS - UNAUDITED
ADJUSTED RETURN
ON EQUITY FORECAST RECONCILIATION
(In millions)
2024 Forecast
Net earnings
$
500
Other items impacting comparability
(1)
5
Tax impact (2)
—
Adjusted net earnings for ROE (numerator)
(3) [A]
$
505
Average shareholders' equity
$
3,100
Adjustment to equity (4)
—
Adjusted average total equity
(denominator) (3) [B]
$
3,100
Adjusted return on equity (3) [A]/[B]
16
%
________________
(1) Forecasted other items impacting
comparability includes other, net of $5 million.
(2) Represents the tax provision on other items impacting
comparability. (3) Non-GAAP financial measure. Non-GAAP elements of
the calculation have been reconciled to the corresponding GAAP
measures. A numerical reconciliation of net earnings to adjusted
net earnings and average shareholders' equity to adjusted average
total equity set forth in this table. (4) Represents the impact to
equity of items to arrive at adjusted earnings.
Note: Amounts may not be additive due to
rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240725961747/en/
Media: Amy Federman afederman@ryder.com
Investor Relations: Calene Candela ccandela@ryder.com
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