What changed in this filing

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Item 1. Financial Statements

2024-08-08 compared with 2024-05-09 · 109 added, 64 removed, 473 unchanged (27% of the section changed)

55 unchanged sentences

Thirteen Weeks Ended

Twenty-six Weeks Ended

Operating revenues:

29 unchanged sentences

Thirteen Weeks Ended

Twenty-six Weeks Ended

Other comprehensive income (loss):

Unrealized changes in fair value of interest rate swaps, net of income taxes of

$ 202 and $( 277 ), respectively

Unrealized changes in fair value of interest rate swaps,

net of income taxes of $( 18 ), $ 367 , $ 184 and $ 90 , respectively

Foreign currency translation adjustments

5 unchanged sentences

(In thousands)

Thirteen Weeks Ended

Twenty-six Weeks Ended

Cash flows from operating activities:

2 unchanged sentences

Noncash lease expense

Loss (gain) on marketable equity securities

Gain on marketable equity securities

Gain on disposal of property and equipment

5 unchanged sentences

Trade and other accounts receivable

Prepaid expenses and other assets

Contract assets, prepaid expenses and other assets

Principal reduction in operating lease liabilities

7 unchanged sentences

Proceeds from the sale of property and equipment

Proceeds from the sale of marketable securities

Net cash used in investing activities

5 unchanged sentences

Dividends paid

Purchases of treasury stock

Net cash provided by (used in) financing activities

Effect of exchange rate changes on cash and cash equivalents

Net increase (decrease) in cash

Net (decrease) increase in cash

Cash and cash equivalents – beginning of period

14 unchanged sentences

Balances – April 1, 2023

Comprehensive income (loss)

Dividends ($ 0.105 per share)

Stock based compensation

Balances - July 1, 2023

Balances – December 31, 2023

4 unchanged sentences

Balances – March 30, 2024

Comprehensive income (loss)

Dividends ($ 0.105 per share)

Stock based compensation

Purchases of treasury stock

Balances - June 29, 2024

See accompanying notes to consolidated financial statements.

12 unchanged sentences

Our fiscal year ends on December 31 and consists of four quarters, each with thirteen weeks.

The Company made certain immaterial reclassifications to items in its prior financial statements so that their presentation is consistent with the format in the financial statements for the period ended March 30, 2024.

These reclassifications, however, had no effect on reported consolidated net income, comprehensive income, earnings per common share, cash flows, total assets or shareholders’ equity as previously reported.

In June 2024, the Company revised the estimated useful life and salvage values of certain equipment.

The change resulted in additional depreciation expense of $ 11.3 million recorded during the quarter ended June 29, 2024 ($ 8.5 million net of tax, or $ 0.32 per basic and diluted share).

In January 2024, the Company’s value-added business began performing specialty project development services for certain customers.

Contract assets represent amounts for which the Company has recognized revenue in excess of billings pursuant to the revenue recognition guidance.

As of March 30, 2024 and December 31, 2023, contract assets associated with certain contracts with customers recognized over time are included as contract assets in the Company’s consolidated balance sheets.

As of June 29, 2024 and December 31, 2023, contract assets associated with certain contracts with customers recognized over time are included as contract assets in the Company’s consolidated balance sheets.

Contract assets associated with other contracts with customers were reclassified from prepaid expenses and other on the consolidated balance sheets to contract assets.

3 unchanged sentences

After performing the evaluation, it was determined that a change in the estimated useful lives of certain definite lived intangible assets was appropriate and was adjusted during the period.

The change resulted in additional amortization expense of $ 2.2 million recorded during the quarter ended March 30, 2024 ($ 1.7 million net of tax, or $ 0.06 per basic and diluted share).

The change resulted in additional amortization expense of $ 2.2 million ($ 1.7 million net of tax, or $ 0.06 per basic and diluted share) recorded during each of the quarters ended March 30, 2024 and June 29, 2024.

Current Economic Conditions

36 unchanged sentences

Value-added services, which are typically dedicated to individual customer requirements, include material handling, consolidation, sequencing, sub-assembly, cross-dock services, kitting, repacking, warehousing, returnable container management and specialty project development.

Value-added revenues are substantially driven by the level of demand for outsourced logistics services and speciality project needs.

Value-added revenues are substantially driven by the level of demand for outsourced logistics services and specialty project needs.

Major factors that affect value-added service revenue include changes in manufacturing supply chain requirements and production levels in specific industries, particularly the North American automotive and Class 8 heavy-truck industries.

32 unchanged sentences

Net unrealized gains

The Company did no t sell marketable equity securities during either of the thirteen-week week periods ended March 30, 2024 or April 1, 2023.

During the thirteen-week week periods ended March 30, 2024 and April 1, 2023, our marketable equity securities portfolio experienced a net unrealized pre-tax gain (loss) in market value of approximately $ 990,000 and $( 13,000 ), respectively, which was reported in other non-operating income for the period.

The following table shows the Company’s net realized gains and losses on marketable equity securities (in thousands):

Thirteen Weeks Ended

Twenty-six Weeks Ended

Realized gain

Sale proceeds

Cost basis of securities sold

Realized gain

Realized gain, net of taxes

The Company did no t sell marketable equity securities during the thirteen-week or twenty-six week periods ended June 29, 2024.

During the thirteen-week and twenty-six week periods ended June 29, 2024, our marketable equity securities portfolio experienced a net unrealized pre-tax gain (loss) in market value of approximately $( 195,000 ) and $ 795,000 , respectively, which was reported in other non-operating income (expense) for the period.

During the thirteen-week and twenty-six week periods ended July 1, 2023, our marketable equity securities portfolio experienced a net unrealized pre-tax gain (loss) in market value of approximately $ 121,000 and $ 108,000 , respectively, which was reported in other non-operating income (expense) for the period.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

(5) Accrued Expenses and Other Current Liabilities

6 unchanged sentences

Commissions, other taxes and other

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

Debt is comprised of the following (in thousands):

Interest Rates

at March 30, 2024

at June 29, 2024

Outstanding Debt:

12 unchanged sentences

The Revolving Credit Facility includes customary affirmative and negative covenants and events of default, as well as financial covenants requiring minimum fixed charge coverage and leverage ratios, and customary mandatory prepayments provisions.

At March 30, 2024, we were in compliance with all covenants under the facility, and $ 362.2 million was available for borrowing on the revolver.

At June 29, 2024, we were in compliance with all covenants under the facility, and $ 337.0 million was available for borrowing on the revolver.

(2) Our UACL Credit Agreement provides for maximum borrowings of $ 90 million in the form of an $ 80 million term loan and a $ 10 million revolver.

5 unchanged sentences

The UACL Credit Agreement includes customary affirmative and negative covenants and events of default, as well as financial covenants requiring minimum fixed charge coverage and leverage ratios, and customary mandatory prepayments provisions.

At March 30, 2024, we were in compliance with all covenants under the facility, and $ 10.0 million was available for borrowing on the revolver.

At June 29, 2024, we were in compliance with all covenants under the facility, and $ 5.0 million was available for borrowing on the revolver.

(3) Our Equipment Financing consists of a series of promissory notes issued by a wholly owned subsidiary.

The equipment notes, which are secured by liens on specific titled vehicles, are generally payable in 60 monthly installments and bear interest at fixed rates ranging from 2.25 % to 7.31 %.

(4) Our Real Estate Facility facilitated a $ 165.4 million term loan, and the facility matures on April 29, 2032 .

Obligations under the facility are secured by first-priority mortgages on specific parcels of real estate owned by the Company, including all land and real property improvements, and first-priority assignments of rents and related leases of the loan parties.

The credit agreement includes customary affirmative and negative covenants, and principal and interest are payable on the facility on a monthly basis, based on an annual amortization of 10 %.

The facility bears interest at Term SOFR , plus an applicable margin equal to 2.12 %.

At March 30, 2024, we were in compliance with all covenants under the facility.

UNIVERSAL LOGISTICS HOLDINGS, INC.

1 unchanged sentence

(6) Debt – continued

(4) Our Real Estate Facility consists of a $ 165.4 million term loan, and the facility matures on April 29, 2032 .

The credit agreement includes customary affirmative and negative covenants, and principal and interest are payable on the facility on a monthly basis, based on an annual amortization of 10 %.

The facility bears interest at Term SOFR , plus an applicable margin equal to 2.12 %.

At June 29, 2024, we were in compliance with all covenants under the facility.

(5) Our Margin Facility is a short-term line of credit secured by our portfolio of marketable securities.

1 unchanged sentence

The amount available under the line of credit is based on a percentage of the market value of the underlying securities.

At March 30, 2024, the maximum available borrowings under the line of credit were $ 5.7 million.

At June 29, 2024, the maximum available borrowings under the line of credit were $ 5.8 million.

The Company is also party to an interest rate swap agreement that qualifies for hedge accounting.

2 unchanged sentences

The swap agreement has an effective date of April 29, 2022, a maturity date of April 30, 2027 , and an amortizing notional amount of $ 78.3 million.

At March 30, 2024, the fair value of the swap agreement was an asset of $ 2.6 million.

At June 29, 2024, the fair value of the swap agreement was an asset of $ 2.5 million.

Since the swap agreement qualifies for hedge accounting, the changes in fair value are recorded in other comprehensive income (loss), net of tax.

11 unchanged sentences

This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

(7) Fair Value Measurements and Disclosures – continued

We have segregated all financial assets and liabilities that are measured at fair value on a recurring basis into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date in the tables below (in thousands):

7 unchanged sentences

Interest rate swap

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

(7) Fair Value Measurements and Disclosures – continued

The valuation techniques used to measure fair value for the items in the tables above are as follows:

10 unchanged sentences

We categorize these borrowings as Level 2 in the fair value hierarchy.

The carrying value and estimated fair value of these promissory notes at March 30, 2024 is summarized as follows:

The carrying value and estimated fair value of these promissory notes at June 29, 2024 is summarized as follows:

Carrying Value

2 unchanged sentences

We have not elected the fair value option for any of our financial instruments.

As of March 30, 2024, our obligations under operating lease arrangements primarily related to the rental of office space, warehouses, freight distribution centers, terminal yards and equipment.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

As of June 29, 2024, our obligations under operating lease arrangements primarily related to the rental of office space, warehouses, freight distribution centers, terminal yards and equipment.

Right-of-use assets represent our right to use an underlying asset over the lease term and lease liabilities represent the obligation to make lease payments resulting from the lease agreement.

3 unchanged sentences

Options to extend or terminate an agreement are included in the lease term when it becomes reasonably certain the option will be exercised.

As of March 30, 2024, we were not reasonably certain of exercising any renewal or termination options, and as such, no adjustments were made to the right-of-use lease assets or corresponding liabilities.

As of June 29, 2024, we were not reasonably certain of exercising any renewal or termination options, and as such, no adjustments were made to the right-of-use lease assets or corresponding liabilities.

Leases with an initial term of 12 months or less, short-term leases, are not recorded on the balance sheet.

2 unchanged sentences

For equipment leases, variable lease costs may include additional fees associated with using equipment in excess of estimated amounts.

The following table summarizes our lease costs for the thirteen weeks and twenty-six weeks ended June 29, 2024 and July 1, 2023 (in thousands):

Thirteen Weeks Ended June 29, 2024

With Affiliates

With Third Parties

Operating lease cost

Short-term lease cost

Variable lease cost

Total lease cost

Thirteen Weeks Ended July 1, 2023

With Affiliates

With Third Parties

Operating lease cost

Short-term lease cost

Variable lease cost

Total lease cost

UNIVERSAL LOGISTICS HOLDINGS, INC.

1 unchanged sentence

(8) Leases – continued

The following table summarizes our lease costs for the thirteen weeks ended March 30, 2024 and April 1, 2023 (in thousands):

Thirteen Weeks Ended March 30, 2024

Twenty-six Weeks Ended June 29, 2024

With Affiliates

3 unchanged sentences

Variable lease cost

Sublease income

Total lease cost

Thirteen Weeks Ended April 1, 2023

Twenty-six Weeks Ended July 1, 2023

With Affiliates

3 unchanged sentences

Variable lease cost

Sublease income

Total lease cost

The following table summarizes other lease related information as of and for the thirteen week periods ended March 30, 2024 and April 1, 2023 (in thousands):

Thirteen Weeks Ended March 30, 2024

The following table summarizes other lease related information as of and for the twenty-six week periods ended June 29, 2024 and July 1, 2023 (in thousands):

June 29, 2024

Other information

3 unchanged sentences

Weighted-average discount rate

April 1, 2023

Other information

1 unchanged sentence

Right-of-use assets obtained in exchange for new operating lease liabilities

Right-of-use asset change due to lease termination

Right-of-use assets change due to lease termination

Weighted-average remaining lease term (in years)

3 unchanged sentences

(8) Leases – continued

Future minimum lease payments under these operating leases as of March 30, 2024, are as follows (in thousands):

Future minimum lease payments under these operating leases as of June 29, 2024, are as follows (in thousands):

With Affiliates

15 unchanged sentences

We also purchase other services from our affiliates.

Following is a schedule of cost incurred and included in operating expenses for services provided by affiliates for the thirteen weeks ended March 30, 2024 and April 1, 2023 (in thousands):

Following is a schedule of cost incurred and included in operating expenses for services provided by affiliates for the thirteen weeks and twenty-six weeks ended June 29, 2024 and July 1, 2023, respectively (in thousands):

Thirteen Weeks Ended

Twenty-six Weeks Ended

Real estate rent and related costs

11 unchanged sentences

In our Consolidated Balance Sheets, we record our insured claims liability and the related recovery in insurance and claims, and other receivables.

At March 30, 2024 and December 31, 2023, there were $ 16.1 million and $ 14.3 million, respectively, included in each of these accounts for insured claims.

At June 29, 2024 and December 31, 2023, there were $ 17.5 million and $ 14.3 million, respectively, included in each of these accounts for insured claims.

UNIVERSAL LOGISTICS HOLDINGS, INC.

2 unchanged sentences

Other services from affiliates, including contracted transportation services, are delivered to us on a per-transaction basis or pursuant to separate contractual arrangements provided in the ordinary course of business.

At March 30, 2024 and December 31, 2023, amounts due to affiliates were $ 23.3 million and $ 20.7 million, respectively.

During the thirteen weeks ended March 30, 2024, we purchased trailers from an affiliate totaling $ 1.6 million.

There were no such purchases made during the thirteen weeks ended April 1, 2023.

At June 29, 2024 and December 31, 2023, amounts due to affiliates were $ 20.4 million and $ 20.7 million, respectively.

During the twenty-six weeks ended June 29, 2024, we purchased trailers from an affiliate totaling $ 3.1 million.

During the twenty-six weeks ended July 1, 2023, we purchased used tractors from an affiliate totaling $ 6.3 million.

In June 2022, we executed a real estate contract with an affiliate to acquire a multi-building, office complex located in Warren, Michigan for $ 8.3 million.

The purchase price was established by an independent, third-party appraisal.

During 2022, the Company made an initial deposit of $ 200,000 and paid the balance at closing in the first quarter of 2023.

The Company made an initial deposit of $ 0.2 million in 2022, and paid the balance at closing in the first quarter of 2023.

Services provided by Universal to Affiliates

2 unchanged sentences

Truck fueling and administrative expenses are presented net in operating expense.

Following is a schedule of services provided to affiliates for the thirteen weeks and ended March 30, 2024 and April 1, 2023 (in thousands):

Following is a schedule of services provided to affiliates for the thirteen weeks and twenty-six weeks ended June 29, 2024 and July 1, 2023 (in thousands):

Thirteen Weeks Ended

Twenty-six Weeks Ended

Contracted transportation services

Facilities and related support

At March 30, 2024 and December 31, 2023, amounts due from affiliates were $ 1.1 million and $ 0.7 million, respectively.

At June 29, 2024 and December 31, 2023, amounts due from affiliates were $ 0.8 million and $ 0.7 million, respectively.

(10) Stock Based Compensation

In May 2024, we granted 1,545 shares of common stock under our equity plan to non-employee directors.

These restricted stock awards have a fair value of $ 45.22 per share, based on the closing price of our stock on the grant date, and vested immediately.

In February 2024, we granted 21,105 shares of restricted stock under our equity plan to certain employees, including 5,160 shares to our Chief Executive Officer and 5,223 shares to our Chief Financial Officer.

23 unchanged sentences

Non-vested at January 1, 2024

Balance at March 30, 2024

In the thirteen week periods ended March 30, 2024 and April 1, 2023, the total grant date fair value of vested shares recognized as compensation costs was $ 0.7 million and $ 0.2 million, respectively.

As of March 30, 2024, there was approximately $ 2.2 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements.

Balance at June 29, 2024

In the twenty-six week periods ended June 29, 2024 and July 1, 2023, the total grant date fair value of vested shares recognized as compensation costs was $ 0.8 million and $ 0.3 million, respectively.

Included in compensation cost during both the twenty-six week periods ended June 29, 2024 and July 1, 2023 was approximately $ 0.1 million recognized as a result of the grants of shares of stock to non-employee directors.

As of June 29, 2024, there was approximately $ 2.2 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements.

That cost is expected to be recognized on a straight-line basis over the remaining vesting period.

3 unchanged sentences

Diluted earnings per common share include dilutive common stock equivalents determined by the treasury stock method.

For the thirteen weeks ended March 30, 2024 and April 1, 2023, there were 21,011 and 33,348 weighted average non-vested shares of restricted stock, respectively, included in the denominator for the calculation of diluted earnings per share.

No shares of non-vested restricted stock were excluded from the calculation of diluted earnings per share due to anti-dilution during the thirteen weeks ended March 30, 2024 or April 1, 2023.

For the thirteen weeks and twenty-six weeks ended June 29, 2024, there were 34,962 and 28,789 weighted average non-vested shares of restricted stock, respectively, included in the denominator for the calculation of diluted earnings per share.

For the thirteen weeks and twenty-six weeks ended July 1, 2023, 21,634 and 27,954 weighted average non-vested shares of restricted stock, respectively, were included in the denominator for the calculation of diluted earnings per share.

No shares of non-vested restricted stock were excluded from the calculation of diluted earnings per share because such shares were anti-dilutive during the thirteen weeks or twenty-six weeks ended June 29, 2024 or July 1, 2023.

(12) Dividends

On February 14, 2024 , our Board of Directors declared a cash dividend of $ 0.105 per share of common stock, payable on April 1, 2024 to shareholders of record at the close of business on March 4, 2024 .

On April 25, 2024 , our Board of Directors declared a cash dividend of $ 0.105 per share of common stock, payable on July 1, 2024 to shareholders of record at the close of business on June 3, 2024 .

Declaration of future cash dividends is subject to final determination by the Board of Directors each quarter after its review of our financial condition, results of operations, capital requirements, any legal or contractual restrictions on the payment of dividends and other factors the Board of Directors deems relevant.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

(13) Segment Reporting

8 unchanged sentences

Separate balance sheets are not prepared by segment, and we do not provide asset information by segment to the chief operating decision maker.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

(13) Segment Reporting – continued

The following tables summarize information about our reportable segments for the thirteen week periods ended March 30, 2024 and April 1, 2023 (in thousands):

The following tables summarize information about our reportable segments for the thirteen week and twenty-six week periods ended June 29, 2024 and July 1, 2023 (in thousands):

Operating Revenues

Thirteen Weeks Ended

Twenty-six Weeks Ended

Contract logistics

3 unchanged sentences

Thirteen Weeks Ended

Twenty-six Weeks Ended

Contract logistics

3 unchanged sentences

Thirteen Weeks Ended

Twenty-six Weeks Ended

Contract logistics

1 unchanged sentence

Total income from operations

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

(14) Treasury Stock

4 unchanged sentences

The Company accounts for treasury stock using the cost method.

As of March 30, 2024, there were no shares held in the treasury.

UNIVERSAL LOGISTICS HOLDINGS, INC.

Notes to Unaudited Consolidated Financial Statements - Continued

As of June 29, 2024, 1,957 shares were held in treasury at an aggregate cost of approximately $ 0.1 million.

(15) Commitments and Contingencies

Our principal commitments relate to long-term real estate leases and payment obligations to equipment vendors.

We are involved in certain other claims and pending litigation arising from the ordinary conduct of business.

We are involved in certain other claims and pending litigation arising in the ordinary conduct of business.

We also provide accruals for claims within our self-insured retention amounts.

1 unchanged sentence

However, if we experience claims that are not covered by our insurance or that exceed our estimated claim reserve, it could increase the volatility of our earnings and have a materially adverse effect on our financial condition, results of operations or cash flows.

At March 30, 2024, approximately 32 % of our employees were subject to collective bargaining agreements that are renegotiated periodically, 45 % of which are subject to contracts that expire in 2024.

At June 29, 2024, approximately 34 % of our employees were subject to collective bargaining agreements that are renegotiated periodically, 37 % of which are subject to contracts that expire in 2024.

(16) Subsequent Events

On April 25, 2024 , our Board of Directors declared a cash dividend of $ 0.105 per share of common stock, payable on July 1, 2024 to shareholders of record at the close of business on June 3, 2024 .

On July 25, 2024 , our Board of Directors declared a cash dividend of $ 0.105 per share of common stock, payable on October 1, 2024 to shareholders of record at the close of business on September 2, 2024 .

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements