Ryder System, Inc. · NYSE:R

Ryder System — Q2 2012 Earnings Presentation

39 slides from Ryder System's earnings presentation, Jul 24, 2012

Slide 1: Second Quarter 2012 Earnings Conference Call
Second Quarter 2012 Earnings Conference Call July 24, 2012
Slide 2: Safe Harbor and Non-GAAP Financial Measures
Safe Harbor and Non-GAAP Financial Measures Certain statements and information included in this presentation are "forward-looking statements" under the Federal Private Securities Litigation Reform Act of 1995, including our expectations for future earnings and other financial performance. Accordingl
Slide 4: 2nd Quarter Results Overview
2nd Quarter Results Overview ► Earnings per diluted share from continuing operations were $0.91 in 2Q12 vs. $0.79 in 2Q11 – 2Q12 included a $0.09 charge related to restructuring – 2Q11 included a $0.10 charge from a tax law change and a $0.03 charge from acquisition-related restructuring costs ► Com
Slide 5: Key Financial Statistics
Key Financial Statistics ($ Millions, Except Per Share Amounts) Second Quarter 2012 2011 % B/(W) Operating Revenue $ 1,266.6 $ 1,192.0 6% Fuel Services and Subcontracted Transportation Revenue 297.3 321.3 (7)% Total Revenue $ 1,563.9 $ 1,513.3 3% Earnings Per Share From Continuing Operations $ 0.91
Slide 6: Key Financial Statistics
Key Financial Statistics ($ Millions, Except Per Share Amounts) Year-to-Date 2012 2011 % B/(W) Operating Revenue $ 2,495.5 $ 2,321.1 8% Fuel Services and Subcontracted Transportation Revenue 604.6 617.6 (2)% Total Revenue $ 3,100.1 $ 2,938.7 5% Earnings Per Share From Continuing Operations $ 1.59 $
Slide 7: 2nd Quarter Results Overview - FMS
2nd Quarter Results Overview - FMS ► Fleet Management Solutions (FMS) total revenue up 3% (and operating revenue up 7%) vs. prior year – Contractual revenue up 5% – Full service lease revenue up 5% – Contract maintenance revenue up 2% – Commercial rental revenue up 10% – Fuel revenue down 5% due pri
Slide 8: 2nd Quarter Results Overview – SCS (including DCC)
2nd Quarter Results Overview – SCS (including DCC) ► Supply Chain Solutions (SCS) total revenue up 6% (and operating revenue up 6%) vs. prior year due to higher automotive freight volumes (including impact from the prior year natural disasters in Japan) and new business ► SCS earnings before tax (EB
Slide 9: Business Segments
Business Segments ($ Millions) Second Quarter Memo: Total Revenue 2012 2011 % B/(W) 2012 2011 % B/(W) Operating Revenue: Fleet Management Solutions $ 830.9 $ 778.9 7% $ 1,100.9 $ 1,064.5 3% (1) Supply Chain Solutions 485.7 456.8 6% 570.3 540.0 6% Eliminations (50.0) (43.7) (14)% (107.3) (91.1) (18)%
Slide 10: Business Segments
Business Segments ($ Millions) Year-To-Date Memo: Total Revenue 2012 2011 % B/(W) 2012 2011 % B/(W) Operating Revenue: Fleet Management Solutions $ 1,623.6 $ 1,497.9 8% $ 2,172.3 $ 2,044.6 6% Supply Chain Solutions(1) 970.3 909.5 7% 1,142.2 1,075.7 6% Eliminations (98.4) (86.3) (14)% (214.3) (181.6)
Slide 11: Capital Expenditures
Capital Expenditures ($ Millions) Year-To-Date 2012 $ 2012 2011 O/(U) 2011 Full Service Lease $ 786 $ 327 $ 458 Commercial Rental 500 518 (18) Operating Property and Equipment 32 35 (3) Gross Capital Expenditures 1,317 880 437 Less: Proceeds from Sales (Primarily Revenue Earning Equipment) 199 143 5
Slide 12: Cash Flow from Continuing Operations
Cash Flow from Continuing Operations ($ Millions) Year-To-Date 2012 2011 Earnings from Continuing Operations $ 82 $ 67 Depreciation 460 421 Gains on Vehicle Sales, Net (45) (28) Amortization and Other Non-Cash Charges, Net 34 27 Pension Contributions (40) (7) Changes in Working Capital and Deferred
Slide 13: Debt to Equity Ratio
Debt to Equity Ratio ($ Millions) Balance Sheet Debt to Equity Total Obligations to Equity 300% 275% 284% 275% 261% 250% 234% 225% 201% 203% 200% 168% 183% 146% 151% 157% 150% 129% 100% 50% 0% 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04 12/31/05 12/31/06 12/31/07 12/31/08 12/31/09 12/31/10 12/31/11
Slide 15: Global Asset Management Update
(1) Global Asset Management Update ► Units held for sale were 9,200 at quarter end, up from 5,000 units held for sale in the prior year – Sequentially from the first quarter, units held for sale increased by 500 units ► The number of used vehicles sold in the second quarter were 6,200, up 41% from t
Slide 17: EPS Forecast – Continuing Operations
EPS Forecast – Continuing Operations ($ Earnings Per Share) ► Increasing full year EPS forecast from $3.65 - $3.85 to $3.75 - $3.90 ► Current forecast is as follows: Third Quarter Full Year 2012 Comparable EPS Forecast(1) $ 1.15 - 1.22 $ 3.75 - 3.90 2011 Comparable EPS $1.09 $3.49 (1) Full Year 2012
Slide 19: Appendix
Appendix Business Segment Detail Central Support Services Balance Sheet Asset Management Financial Indicators Forecast Adjusted Return on Capital History Non-GAAP Financial Measures & Reconciliations 7/24/2012 © 2012 Ryder System, Inc. All rights reserved. 19
Slide 20: Fleet Management Solutions (FMS)
Fleet Management Solutions (FMS) ($ Millions) Second Quarter 2012 2011 % B/(W) Full Service Lease $ 521.5 $ 494.7 5% Contract Maintenance 46.5 45.6 2% Contractual Revenue 568.0 540.4 5% Contract-related Maintenance 46.5 40.9 14% Commercial Rental 198.7 180.0 10% Other 17.7 17.6 - Operating Revenue 8
Slide 21: Fleet Management Solutions (FMS)
Fleet Management Solutions (FMS) ($ Millions) Year-To-Date 2012 2011 % B/(W) Full Service Lease $ 1,032.0 $ 978.0 6% Contract Maintenance 93.5 89.5 4% Contractual Revenue 1,125.5 1,067.5 5% Contract-related Maintenance 93.0 79.8 17% Commercial Rental 370.0 315.7 17% Other 35.1 34.9 1% Operating Reve
Slide 22: Supply Chain Solutions (SCS)
Supply Chain Solutions (SCS) (1) ($ Millions) Second Quarter 2012 2011 % B/(W) Automotive $ 141.9 $ 107.8 32% High-Tech 78.0 85.4 (9)% Retail & CPG 177.5 176.1 1% Industrial & Other 88.2 87.6 1% Operating Revenue 485.7 456.8 6% Subcontracted Transportation 84.5 83.2 2% Total Revenue $ 570.3 $ 540.0
Slide 23: Supply Chain Solutions (SCS)
Supply Chain Solutions (SCS) (1) ($ Millions) Year-To-Date 2012 2011 % B/(W) Automotive $ 281.7 $ 230.5 22% High-Tech 158.3 165.8 (5)% Retail & CPG 356.3 343.1 4% Industrial & Other 174.1 170.0 2% Operating Revenue 970.3 909.5 7% Subcontracted Transportation 171.8 166.3 3% Total Revenue $ 1,142.2 $
Slide 24: Central Support Services (CSS)
Central Support Services (CSS) ($ Millions) Second Quarter 2012 2011 % B/(W) Allocated CSS Costs $ 37.5 $ 40.2 7% Unallocated CSS Costs 11.2 11.2 - Total CSS Costs $ 48.7 $ 51.4 5% 7/24/2012 © 2012 Ryder System, Inc. All rights reserved. 24
Slide 25: Central Support Services (CSS)
Central Support Services (CSS) ($ Millions) Year-To-Date 2012 2011 % B/(W) Allocated CSS Costs $ 76.6 $ 76.8 - Unallocated CSS Costs 20.7 19.9 (4)% Total CSS Costs $ 97.3 $ 96.7 (1)% 7/24/2012 © 2012 Ryder System, Inc. All rights reserved. 25
Slide 26: Balance Sheet
Balance Sheet ($ Millions) June 30, December 31, 2012 2011 Cash and Cash Equivalents $ 73 $ 105 Other Current Assets 987 984 Revenue Earning Equipment, Net 5,563 5,050 Operating Property and Equipment, Net 620 624 Other Assets 875 856 Total Assets $ 8,117 $ 7,618 Short-Term Debt / Current Portion Lo
Slide 27: U.S. Asset Management Update
(a) U.S. Asset Management Update Number of Units YTD 07 YTD 08 YTD 09 YTD 10 YTD 11 YTD 12 5,000 4,381 Redeployments – Vehicles 4,500 coming off-lease with useful life remaining are redeployed 4,000 3,880 in the Ryder fleet (Commercial 3,689 Rental, SCS, or with another 3,494 Lease customer). 3,500
Slide 28: Financial Indicators Forecast
Financial Indicators Forecast (1) Total Cash Generated (2) Gross Capital Expenditures (2) ($ Millions) Full Service Lease $1,684 $1,820 $2,150 Commercial Rental $1,571 $1,442 PP&E/Other $1,757 $1,381 $1,760 $1,252 $1,266 $1,328 $1,091 $1,179 $1,399 $1,054 $949 $1,289 $1,182 $1,265 $835 $1,165 $1,088
Slide 29: Adjusted Return on Capital History
Adjusted Return on Capital History Adjusted 7.7% 7.8% 7.9% 7.3% Return on 7.4% Capital (ROC) 6.3% 6.1% 5.7% 5.6% 6.9% 6.8% 6.7% 6.6% 6.5% Cost of 5.5% Capital (COC) 4.8% 4.8% 4.1% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 Forecast Forecast ROC O/(U) COC 0.8% 1.0% 1.2% 0.8% 0.8% (2.2)% (1.3)%
Slide 30: Non-GAAP Financial Measures
Non-GAAP Financial Measures ► This presentation includes “non-GAAP financial measures” as defined by SEC rules. As required by SEC rules, we provide a reconciliation of each non-GAAP financial measure to the most comparable GAAP measure. Non-GAAP financial measures should be considered in addition t
Slide 31: Earnings and EPS from Continuing Operations Reconciliation
Earnings and EPS from Continuing Operations Reconciliation ($ Millions or $ Earnings Per Share) 2Q12 - 2Q12 - 2Q11 - 2Q11 - Earnings EPS Earnings EPS Reported $ 46.8 $ 0.91 $ 40.9 $ 0.79 Tax law change - - 5.4 0.10 Restructuring Charges 4.5 0.09 - - Acquisition Related Transaction Costs - - 1.6 0.03
Slide 32: EBT and Tax Rate from Continuing Operations Reconciliation
EBT and Tax Rate from Continuing Operations Reconciliation ($ Millions or $ Earnings Per Share) 2Q12 - 2Q12 - 2Q12 - EBT Tax Tax Rate Reported $ 73.8 $ 27.0 Restructuring Charges 7.1 2.6 (1) Comparable $ 80.9 $ 29.6 36.6% YTDQ12 - YTD12 - YTDQ12 - EBT Tax Tax Rate Reported $ 121.5 $ 39.8 Tax Benefit
Slide 33: EBT and Tax Rate from Continuing Operations Reconciliation
EBT and Tax Rate from Continuing Operations Reconciliation ($ Millions or $ Earnings Per Share) 2Q11 - 2Q11 - 2Q11 - EBT Tax Tax Rate Reported $ 75.0 $ 34.1 45.5% Tax Law Changes - (5.4) Acquisition Transaction Costs 1.7 0.2 Comparable (1) $ 76.7 $ 28.9 37.7% YTDQ11 - YTD11 - YTDQ11 - EBT Tax Tax Ra
Slide 34: Adjusted Return on Capital Reconciliation
Adjusted Return on Capital Reconciliation ($ Millions) 6/30/12 6/30/11 Net Earnings (1) $ 186 $ 141 Restructuring and Other Charges, Net and Other Items 11 9 Income Taxes 97 81 Adjusted Earnings Before Income Taxes 294 231 Adjusted Interest Expense (2) 138 136 Adjusted Income Taxes (3) (158) (139) A
Slide 35: Debt to Equity Reconciliation
Debt to Equity Reconciliation ($ Millions) % to % to % to % to % to % to % to % to 12/31/00 Equity 12/31/01 Equity 12/31/02 Equity 12/31/03 Equity 12/31/04 Equity 12/31/05 Equity 12/31/06 Equity 12/31/07 Equity Balance Sheet Debt $2,017 161% $1,709 139% $1,552 140% $1,816 135% $1,783 118% $2,185 143
Slide 36: Debt to Equity Reconciliation
Debt to Equity Reconciliation ($ Millions) % to % to % to % to % to % to 12/31/08 Equity 12/31/09 Equity 12/31/10 Equity 12/31/11 Equity 6/30/12 Equity 6/30/11 Equity Balance Sheet Debt $2,863 213% $2,498 175% $2,747 196% $3,382 257% $3,746 271% $3,242 222% Receivables Sold - - - - - - PV of minimum
Slide 37: Cash Flow Reconciliation
Cash Flow Reconciliation ($ Millions) 12/31/00 (1) 12/31/01 (1) 12/31/02 (1) 12/31/03 (1) 12/31/04 (1) 12/31/05 12/31/06 12/31/07 12/31/08 12/31/09 Cash Provided by Operating Activities $ 1,023 $ 365 $ 617 $ 803 $ 867 $ 776 $ 852 $ 1,097 $ 1,248 $ 985 Less: Changes in Bal. of Trade Rec. Sold (270) 2
Slide 38: Cash Flow Reconciliation
Cash Flow Reconciliation ($ Millions) 12/31/10 12/31/11 6/30/12 6/30/11 Cash Provided by Operating Activities from Continuing Operations $ 1,028 $ 1,042 $ 472 $ 473 Proceeds from Sales (Primarily Revenue Earning Equipment) 235 300 199 143 Proceeds from Sale and Leaseback of Assets - 37 130 - Collect
Slide 39: Slide 39

Ryder System — Q2 2012 Earnings Presentation on 6ix

Ryder System — Q2 2012 Earnings Presentation

Slide 1: Second Quarter 2012 Earnings Conference Call

Slide 2: Safe Harbor and Non-GAAP Financial Measures

Slide 3: Contents

Slide 4: 2nd Quarter Results Overview

Slide 5: Key Financial Statistics

Slide 6: Key Financial Statistics

Slide 7: 2nd Quarter Results Overview - FMS

Slide 8: 2nd Quarter Results Overview – SCS (including DCC)

Slide 9: Business Segments

Slide 10: Business Segments

Slide 11: Capital Expenditures

Slide 12: Cash Flow from Continuing Operations

Slide 13: Debt to Equity Ratio

Slide 14: Contents

Slide 15: Global Asset Management Update

Slide 16: Contents

Slide 17: EPS Forecast – Continuing Operations

Slide 18: Q&A

Slide 19: Appendix

Slide 20: Fleet Management Solutions (FMS)

Slide 21: Fleet Management Solutions (FMS)

Slide 22: Supply Chain Solutions (SCS)

Slide 23: Supply Chain Solutions (SCS)

Slide 24: Central Support Services (CSS)

Slide 25: Central Support Services (CSS)

Slide 26: Balance Sheet

Slide 27: U.S. Asset Management Update

Slide 28: Financial Indicators Forecast

Slide 29: Adjusted Return on Capital History

Slide 30: Non-GAAP Financial Measures

Slide 31: Earnings and EPS from Continuing Operations Reconciliation

Slide 32: EBT and Tax Rate from Continuing Operations Reconciliation

Slide 33: EBT and Tax Rate from Continuing Operations Reconciliation

Slide 34: Adjusted Return on Capital Reconciliation

Slide 35: Debt to Equity Reconciliation

Slide 36: Debt to Equity Reconciliation

Slide 37: Cash Flow Reconciliation

Slide 38: Cash Flow Reconciliation

Slide 39: Slide 39