Ryder System, Inc. (NYSE:R) Q4 2019 Earnings Conference Call - Final Transcript

Feb 13, 2020 • 11:00 am ET

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Ryder System, Inc. (NYSE:R) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning, and welcome to the Ryder System Fourth Quarter 2019 Earnings Release Conference Call. [Operator Instructions]

I would now like to introduce Mr. Bob Brunn, Vice President, Investor Relations, Corporate Strategy and Product Strategy for Ryder. Mr. Brunn, you may begin.

Executive
Robert S. Brunn

Thanks very much. Good morning, and welcome to Ryder's Fourth Quarter 2019 Earnings and 2020 Forecast Conference Call. I'd like to remind you that during this presentation, you'll hear some forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and are subject to unseen changes in circumstances. Actual results may differ materially from these expectations due to changes in economics, business, competitive, market, political and regulatory factors. More detailed information about these factors and a reconciliation of each non-GAAP financial measure to the nearest GAAP measure is contained in this morning's earnings release, earnings call presentation and in Ryder's filings with the Securities and Exchange Commission which are available on Ryder's website. Presenting on today's call are Robert Sanchez, Chairman and Chief Executive Officer; and Scott Parker, Executive Vice President and Chief Financial Officer. Additionally, John Diez, President of Global Fleet Management Solutions; and Steve Sensing, President of Global Supply Chain Solutions and Dedicated Transportation Solutions, are on the call today and available for questions following the presentation.

At this time, I'll turn the call over to Robert.

Executive
Robert E. Sanchez

Good morning, everyone, and thanks for joining us. This morning, we'll provide a brief overview of our fourth quarter results. We'll also provide our 2020 outlook, including actions that we're taking to improve returns. Following our prepared remarks, we'll open the call for questions. With that, let's turn to an overview of our fourth quarter results. Comparable earnings per share from continuing operations was a loss of $0.01 for the quarter as compared to a profit of $1.87 in the prior year. The loss includes $1.67 in higher depreciation related to previously announced residual value estimate changes. Comparable results were at the lower end of our forecast range of a loss of $0.03 to a profit of $0.07, reflecting a modest increase in the depreciation impact of the residual value change as we trued up the estimates provided.

Operating revenue increased by 3% to a record $1.8 billion for the fourth quarter, driven by contractual revenue growth in Fleet Management and Dedicated partially offset by lower revenue as expected in Supply Chain. Page five includes some additional financial information for the fourth quarter. Comparable EBITDA for the quarter was $564 million, up 1% from the prior year, primarily reflecting earnings contributions from our contractual businesses and cost reductions, partially offset by lower rental demand, higher insurance-related costs and the impact from customer labor strikes. Comparable EBITDA for the full year was a record $2.3 billion, up 11% from the prior year. The average number of diluted shares outstanding was 52.3 million, down slightly from the prior year. Excluding pension costs and other items, the comparable tax rate was