Slide 1: Fourth Quarter 2015 Earnings & 2016 Forecast Conference Call
Fourth Quarter 2015 Earnings & 2016 Forecast Conference Call February 2, 2016
Slide 2: Safe Harbor and Non-GAAP Financial Measures
© 2015 Ryder System, Inc. All Rights Reserved. Safe Harbor and Non-GAAP Financial Measures 2 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 regarding mark
Slide 3: Contents
© 2015 Ryder System, Inc. All Rights Reserved. Contents 3 ► Fourth Quarter 2015 Results Overview ►Asset Management Update ► 2016 Forecast ► Q & A
Slide 4: 4th Quarter Results Overview
© 2015 Ryder System, Inc. All Rights Reserved. 4th Quarter Results Overview 4 ► Comparable earnings per share from continuing operations were $1.66 vs. $1.60 in 4Q14 – 4Q15 comparable earnings included $0.06 of insurance related charges ► Earnings per diluted share from continuing operations were $1
Slide 5: Key Financial Statistics Fourth Quarter
© 2015 Ryder System, Inc. All Rights Reserved. Key Financial Statistics 5 Fourth Quarter ($ Millions, Except Per Share Amounts) Note: Amounts throughout presentation may not be additive due to rounding. 2015 2014 % B/(W) Operating Revenue 1,441.7$ 1,349.3$ 7% Fuel and Subcontracted Transportation 23
Slide 6: Key Financial Statistics Full Year
© 2015 Ryder System, Inc. All Rights Reserved. Key Financial Statistics 6 Full Year ($ Millions, Except Per Share Amounts) 2015 2014 % B/(W) Operating Revenue 5,561.1$ 5,252.2$ 6% Fuel and Subcontracted Transportation 1,010.8 1,386.6 (27)% Total Revenue 6,571.9$ 6,638.8$ (1)% Comparable Earnings Per
Slide 7: 4th Quarter Results Overview – FMS
© 2015 Ryder System, Inc. All Rights Reserved. 4th Quarter Results Overview – FMS 7 ► Fleet Management Solutions (FMS) operating revenue up 7% (up 9% excluding foreign exchange) and total revenue unchanged vs. prior year – Full service lease revenue up 7% (up 9% excluding foreign exchange) – Contrac
Slide 8: 4th Quarter Results Overview – DTS
© 2015 Ryder System, Inc. All Rights Reserved. 4th Quarter Results Overview – DTS 8 ► Dedicated Transportation Solutions (DTS) operating revenue up 11% and total revenue up 5% – Operating revenue increased due to new business, higher volumes and pricing – Total revenue reflects lower fuel costs ► DT
Slide 9: 4th Quarter Results Overview – SCS
© 2015 Ryder System, Inc. All Rights Reserved. 4th Quarter Results Overview – SCS 9 ► Supply Chain Solutions (SCS) operating revenue up 4% (up 7% excluding foreign exchange) and total revenue down 1% vs. prior year – Operating revenue increased due to new business, higher volumes and increased prici
Slide 10: Business Segments – Fourth Quarter
© 2015 Ryder System, Inc. All Rights Reserved. Business Segments 10 2015 2014 % B/(W) 2015 2014 % B/(W) Operating Revenue: Fleet Management Solutions 999.4$ 930.8$ 7% 1,151.6$ 1,152.5$ - Dedicated Transportation Solutions 187.6 169.4 11% 232.4 222.3 5% Supply Chain Solutions 322.1 310.8 4% 392.5 396
Slide 11: Business Segments – Full Year
© 2015 Ryder System, Inc. All Rights Reserved. Business Segments 11 2015 2014 % B/(W) 2015 2014 % B/(W) Operating Revenue: Fleet Management Solutions 3,846.0$ 3,630.5$ 6% 4,545.7$ 4,655.8$ (2)% Dedicated Transportation Solutions 714.5 661.2 8% 895.5 899.8 - Supply Chain Solutions 1,256.3 1,201.3 5%
Slide 12: Capital Expenditures
© 2015 Ryder System, Inc. All Rights Reserved. Capital Expenditures 12 2015 $ 2015 2014 O/(U) 2014 Full Service Lease 2,060$ 1,733$ 327$ Commercial Rental 523 415 108 Operating Property and Equipment 113 150 (37) Gross Capital Expenditures 2,696 2,298 398 Less: Proceeds from Sales (Primarily Revenue
Slide 13: Cash Flow from Continuing Operations
© 2015 Ryder System, Inc. All Rights Reserved. Cash Flow from Continuing Operations 13 Full Year ($ Millions) (1) Capital expenditures presented net of changes in accounts payable related to purchases of revenue earning equipment. (2) Free Cash Flow excludes acquisitions and changes in restricted ca
Slide 14: Debt to Equity Ratio
© 2015 Ryder System, Inc. All Rights Reserved. 272% 227% 260% 278% 250% 0% 50% 100% 150% 200% 250% 300% 12/31/12 12/31/13 12/31/14 12/31/15 Long Term Target Midpoint Pension Impact Debt to Equity Debt to Equity Ratio 14 12/31/2015 12/31/2014 Total Debt 5,518$ 4,731$ Total Equity (3) 1,987$ 1,819$ De
Slide 15: Contents
© 2015 Ryder System, Inc. All Rights Reserved. Contents 15 ► Fourth Quarter 2015 Results Overview ►Asset Management Update ► 2016 Forecast ► Q & A
Slide 16: Global Asset Management Update
© 2015 Ryder System, Inc. All Rights Reserved. ► Units held for sale were 8,000 at quarter end, up from 5,500 units held for sale in the prior year ─ Sequentially from the third quarter, units held for sale increased by 1,900 units ► The number of used vehicles sold in the fourth quarter was 4,500,
Slide 17: Contents
© 2015 Ryder System, Inc. All Rights Reserved. Contents 17 ► Fourth Quarter 2015 Results Overview ►Asset Management Update ► 2016 Forecast ► Q & A
Slide 18: 2016 Forecast Assumptions
© 2015 Ryder System, Inc. All Rights Reserved. 2016 Forecast Assumptions 18 General ► Moderate to slow overall economic environment; industrial recession ► Average interest rate unchanged as lower fixed refinancing rates offset higher variable rates ► Foreign exchange rates stable; negative year-ove
Slide 19: 2016 Forecast Assumptions DTS, SCS, Other
© 2015 Ryder System, Inc. All Rights Reserved. 2016 Forecast Assumptions 19 DTS ► Revenue growth driven by new sales ► Earnings benefit from growth, lower insurance and overhead costs SCS ► Revenue growth driven by new sales, partially offset by foreign exchange ► Stable volumes at existing accounts
Slide 20: 2016 Forecast Key Financial Statistics
© 2015 Ryder System, Inc. All Rights Reserved. Key Financial Statistics 20 ($ Millions, Except Per Share Amounts) 2015 % B / (W) Revenue: Operating Revenue $ 5,815 5,561$ 5% Fuel and Subcontracted Transportation 1,155 1,011 14% Total Revenue $ 6,970 6,572$ 6% Earnings From Continuing Operations: Ear
Slide 21: Business Segment Revenue Forecast
© 2015 Ryder System, Inc. All Rights Reserved. Business Segment Revenue 21 Forecast Forecast ex-FX Fleet Management Solutions: Total Revenue 4% 6% Operating Revenue (1) 4% 6% Full Service Lease Revenue 6% 8% Commercial Rental Revenue (4)% (3)% Dedicated Transportation Solutions: Total Revenue 17% 17
Slide 22: 2016 Causes of Comparable EPS Change
© 2015 Ryder System, Inc. All Rights Reserved. 2016 Causes of Comparable EPS Change (1) 22 ($ Earnings Per Share) Note: Full year impact of residual values change totals $0.40 - Demand + Depreciation - Tax - Shares - FX (1) Represents Comparable EPS from Continuing Operations - Merit - Bonus - Medic
Slide 23: Capital Expenditures, Cash Flow & Leverage
© 2015 Ryder System, Inc. All Rights Reserved. Capital Expenditures, Cash Flow & Leverage 23 2016 Forecast 2015 Full Service Lease: Replacement $ 1,100 1,038$ Growth 680 1,022 Total Full Service Lease 1,780 2,060 Commercial Rental: Replacement 90 253 Growth - 270 Total Commercial Rental 90 523 Opera
Slide 24: Growth Capital Expenditures and Free Cash Flow
© 2015 Ryder System, Inc. All Rights Reserved. Fix formatting Growth Capital Expenditures 24 Free Cash Flow $ 614 258 (257) (488) (340) (315) (728) 100 ($ Millions) 2016 1,022 460 177 216 270 0.0 0.5 1.0 2009 2010 2011 2012 2013 2014 2015 2016 Forecast 09 0 20 2 2013 2016 Forecast 2014 263 723 733 9
Slide 25: EPS Forecast – Continuing Operations
© 2015 Ryder System, Inc. All Rights Reserved. EPS Forecast – Continuing Operations 25 2016 Comparable EPS Forecast(1) $ 1.03 - 1.08 $ 6.10 - 6.30 2015 Comparable EPS(2) $ 1.08 $ 6.13 First Quarter Full Year ($ Earnings Per Share) (1) 1Q16 Comparable EPS Forecast, a non-GAAP financial measure, exclu
Slide 26: Q&A
© 2015 Ryder System, Inc. All Rights Reserved. Q&A 26
Slide 27: Appendix
© 2015 Ryder System, Inc. All Rights Reserved. Appendix 27 Full Service Lease Vehicle Count Business Segment Detail Central Support Services Balance Sheet Adjusted Return on Capital History Financial Indicators Forecast Asset Management Non-GAAP Financial Measures & Reconciliations
Slide 28: Full Service Lease (FSL) Fleet Count
© 2015 Ryder System, Inc. All Rights Reserved. End of Period 4Q14 1Q15 2Q15 3Q15 4Q15 FSL Fleet (as reported) 125,500 127,500 128,700 130,600 131,800 6,300 UK FSL Trailers 4,400 4,400 4,300 4,300 3,900 (500) FSL Fleet - excluding UK 121,100 123,100 124,400 126,300 127,900 6,800 Sequential Change 1Q1
Slide 29: Fleet Management Solutions Revenue – Fourth Quarter
© 2015 Ryder System, Inc. All Rights Reserved. Fleet Management Solutions (FMS) 29 Revenue 2015 2014 % B/(W) Full Service Lease 624.6$ 582.2$ 7% Contract Maintenance 48.9 47.7 2% Contractual Revenue 673.5 630.0 7% Commercial Rental 245.3 230.9 6% Contract-related Maintenance 59.6 52.1 14% Other 21.0
Slide 30: Fleet Management Solutions Revenue – Full Year
© 2015 Ryder System, Inc. All Rights Reserved. Fleet Management Solutions (FMS) 30 Revenue 2015 2014 % B/(W) Full Service Lease 2,406.7$ 2,276.4$ 6% Contract Maintenance 192.5 184.6 4% Contractual Revenue 2,599.2 2,461.0 6% Commercial Rental 940.0 877.0 7% Contract-related Maintenance 229.2 221.5 3%
Slide 31: Dedicated Transportation Solutions – Fourth Quarter
© 2015 Ryder System, Inc. All Rights Reserved. Dedicated Transportation Solutions (DTS) 31 ($ Millions) Revenue 2015 2014 % B/(W) Operating Revenue 187.6$ 169.4$ 11% Subcontracted Transportation 18.4 15.6 18% Fuel Costs 26.5 37.3 (29)% Total Revenue 232.4$ 222.3$ 5% Earnings Before Tax Segment Earni
Slide 32: Dedicated Transportation Solutions – Full Year
© 2015 Ryder System, Inc. All Rights Reserved. Dedicated Transportation Solutions (DTS) 32 ($ Millions) Revenue 2015 2014 % B/(W) Operating Revenue 714.5$ 661.2$ 8% Subcontracted Transportation 61.2 72.0 (15)% Fuel Costs 119.9 166.5 (28)% Total Revenue 895.5$ 899.8$ - Earnings Before Tax Segment Ear
Slide 33: Supply Chain Solutions – Fourth Quarter
© 2015 Ryder System, Inc. All Rights Reserved. Supply Chain Solutions (SCS) 33 ($ Millions) Revenue 2015 2014 % B/(W) Automotive 121.9$ 110.8$ 10% Technology & Healthcare 65.4 68.3 (4)% CPG & Retail 108.6 107.0 2% Industrial & Other 26.1 24.8 5% Operating Revenue 322.1 310.8 4% Subcontracted Transpo
Slide 34: Supply Chain Solutions – Full Year
© 2015 Ryder System, Inc. All Rights Reserved. Supply Chain Solutions (SCS) 34 ($ Millions) Revenue 2015 2014 % B/(W) Automotive 469.2$ 454.9$ 3% Technology & Healthcare 251.2 236.4 6% CPG & Retail 431.6 405.9 6% Industrial & Other 104.4 104.1 - Operating Revenue 1,256.3 1,201.3 5% Subcontracted Tra
Slide 35: Central Support Services – Fourth Quarter
© 2015 Ryder System, Inc. All Rights Reserved. Central Support Services (CSS) 35 Fourth Quarter ($ Millions) 2015 2014 % B/(W) Allocated CSS Costs 49.6$ 49.9$ 1% Unallocated CSS Costs 15.6 15.2 (2)% Total CSS Costs 65.2$ 65.2$ -
Slide 36: Central Support Services – Full Year
© 2015 Ryder System, Inc. All Rights Reserved. Central Support Services (CSS) 36 Full Year ($ Millions) 2015 2014 % B/(W) Allocated CSS Costs 202.3$ 192.0$ (5)% Unallocated CSS Costs 48.5 51.7 6% Total CSS Costs 250.8$ 243.7$ (3)%
Slide 37: Balance Sheet
© 2015 Ryder System, Inc. All Rights Reserved. Balance Sheet 37 December 31, December 31, 2015 2014 Current Assets 1,098$ 1,044$ Revenue Earning Equipment, Net 8,185 7,202 Operating Property and Equipment, Net 715 700 Other Assets 970 906 Total Assets 10,968$ 9,851$ Current Liabilities 1,046$ 1,075$
Slide 38: Adjusted Return on Capital History
© 2015 Ryder System, Inc. All Rights Reserved. Adjusted Return on Capital History Adjusted Return on Capital (ROC) 6.7% 6.6% 6.5% 6.3% 6.1% 5.5% 4.8% 4.8% 4.7% 4.4% 4.4% 7.9% 7.4% 7.3% 4.1% 4.8% 5.7% 5.7% 5.8% 5.8% 5.8% 5.5% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Forecast Cost of Cap
Slide 39: Financial Indicators
© 2015 Ryder System, Inc. All Rights Reserved. Financial Indicators Forecast (1) 39 161% 139% 140% 135% 118% 143% 164% 147% 213% 175% 196% 257% 272% 227% 260% 2000 2002 2004 2006 2008 2010 2012 2014 2016 Forecast Midpoint Gross Capital Expenditures (2) ($ Millions) $1,289 $600 $725 $1,165 $657 $1,39
Slide 40: Asset Management Update (US Only)
© 2015 Ryder System, Inc. All Rights Reserved. 4,363 7,537 6,096 4,698 9,060 3,636 4,190 7,784 3,012 4,814 8,125 2,786 4,148 7,011 2,846 4,099 6,531 3,123 3,304 5,775 3,194 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 Redeployments Extensions Early Terminations N u m b e r o f U n
Slide 41: Non-GAAP Financial Measures
© 2015 Ryder System, Inc. All Rights Reserved. Non-GAAP Financial Measures 41 ► This presentation includes “non-GAAP financial measures” as defined by SEC rules. As required by SEC rules, we provide a reconciliation of each non-GAAP financial measure to the most comparable GAAP measure. Non-GAAP fin
Slide 42: Foreign Exchange Impact on Operating Revenue Growth
© 2015 Ryder System, Inc. All Rights Reserved. 42 Foreign Exchange Impact on Operating Revenue Growth Fourth Quarter Full Year YOY Growth Fx Impact (1) YOY Growth excl Fx YOY Growth Fx Impact (1) YOY Growth excl Fx Operating Revenue 7% 2% 9% 6% 2% 8% FMS Operating Revenue 7% 2% 9% 6% 2% 8% Full Serv
Slide 43: Earnings and EPS from Continuing Operations Reconciliation
© 2015 Ryder System, Inc. All Rights Reserved. Earnings and EPS from Continuing Operations Reconciliation 43 4Q15 4Q15 4Q14 4Q14 Earnings EPS Earnings EPS Reported 75.9$ 1.42$ 11.5$ 0.22$ Non-operating pension costs 2.8 0.05 1.4 0.03 Pension settlement charges - - 6.9 0.13 Pension lump sum settlemen
Slide 44: Tax Rate Reconciliation
© 2015 Ryder System, Inc. All Rights Reserved. 4Q15 - 4Q15 - 4Q15 - FY15 - FY15 - FY15 - EBT Tax Tax Rate EBT Tax Tax Rate Reported 111.7$ 35.8$ 32.0% 469.2$ 163.2$ 34.8% Non-operating pension costs 4.8 2.0 19.2 8.2 Pension settlement charges - - (0.5) (0.2) Restructuring and other charges (recoveri
Slide 45: Adjusted Return on Capital Reconciliation 2006-2009
© 2015 Ryder System, Inc. All Rights Reserved. Appendix: Non-GAAP Financial Measures 45 2006 2007 2008 2009 Net earnings (1) 249$ 254$ 200$ 62$ Cumulative effect of change in accounting principle - - - - Restructuring and other charges, net and other items - 1 70 30 Income taxes 144 152 150 54 Adjus
Slide 46: Adjusted Return on Capital Reconciliation 2010-2015
© 2015 Ryder System, Inc. All Rights Reserved. Appendix: Non-GAAP Financial Measures 46 ($ Millions) (1) Earnings calculated based on a 12-month rolling period. (2) Interest expense includes interest for on and off-balance sheet vehicle obligations. (3) Income taxes were calculated by excluding taxe
Slide 47: Adjusted Return on Capital Reconciliation by Segment
© 2015 Ryder System, Inc. All Rights Reserved. Appendix: Non-GAAP Financial Measures 47 ($ Millions) (1) Earnings calculated based on a 12-month rolling period. (2) Interest expense includes interest for on and off-balance sheet vehicle obligations. (3) Income taxes were calculated by excluding taxe
Slide 48: Cash Flow Reconciliation 2000-2009
© 2015 Ryder System, Inc. All Rights Reserved. Appendix: Non-GAAP Financial Measures 48 12/31/00 (3) 12/31/01 (3) 12/31/02 (3) 12/31/03 (3) 12/31/04 (3) 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: Ch
Slide 49: Cash Flow Reconciliation 2010-2015
© 2015 Ryder System, Inc. All Rights Reserved. Appendix: Non-GAAP Financial Measures 49 (1) Capital expenditures presented net of changes in accounts payable related to purchases of revenue earning equipment. (2) Free Cash Flow excludes acquisitions and changes in restricted cash. Cash Flow Reconcil
Slide 50: Debt to Equity Reconciliation 2000-2007
© 2015 Ryder System, Inc. All Rights Reserved. Debt to Equity Reconciliation(1) Appendix: Non-GAAP Financial Measures 50 % 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 She
Slide 51: Debt to Equity Reconciliation 2008-2015
© 2015 Ryder System, Inc. All Rights Reserved. Appendix: Non-GAAP Financial Measures 51 Note: Amounts may not recalculate due to rounding. Debt to Equity Reconciliation (1) ($ Millions) (1) The debt to equity metric was not revised in years prior to 2012 to reflect the change in accounting treatment
Slide 52: © 2015 Ryder System, Inc. All Rights Reserved.
© 2015 Ryder System, Inc. All Rights Reserved.