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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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(Address of principal executive offices, including zip code)
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(Telephone number, including area code)
|
|||
Securities registered pursuant to Section 12(b) of the Act:
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|||||
Title of each class
|
Trading symbol(s)
|
Name of exchange on which registered
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|||
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☑
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
|
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Emerging growth company
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Documents Incorporated by Reference into this Report
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Part of Form 10-K into which Document is Incorporated
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Ryder System, Inc. 2020 Proxy Statement
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Part III
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|
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Page No.
|
•
|
offering innovative products, solutions and support services that will create and strengthen customer relationships;
|
•
|
delivering operational excellence through continuous productivity and process improvements;
|
•
|
attracting, developing and retaining the best talent; and
|
•
|
deploying technology that will enable growth while improving operational efficiencies.
|
Fleet Management Solutions
|
(1)
|
U.S. Fleet as of September 2019, Class 3-8, IHS Markit Ltd. (formerly RL Polk)
|
(2)
|
Canada Outsourced Fleet Market as of September 2019, Class 3-8, IHS Markit Ltd. (formerly RL Polk)
|
(3)
|
U.K. Lease and Rental HGV Market, Projection for December 2019, Source: The Society of Motor Manufacturers & Traders (SMMT) 2010 & Ryder Internal Estimate
|
•
|
We are able to leverage our vehicle buying power for the benefit of our customers because we purchase a large number of vehicles from a limited number of manufacturers. Once we have signed an agreement with the customer, we acquire vehicles and components that are custom engineered to the customer’s requirements and lease the vehicles to the customer for periods generally ranging from three to seven years for trucks and tractors and typically ten years for trailers.
|
•
|
We offer ChoiceLease customers a complete maintenance program designed to reduce vehicle downtime through a preventive maintenance plan that is based on vehicle type and time or mileage intervals. Alternatively, we offer flexible maintenance options to our customers designed to provide them with choices on their preferred level of maintenance. Given our continued focus on improving the efficiency and effectiveness of our maintenance services, particularly in light of changing technology and increased regulation, we provide our ChoiceLease customers with a cost effective alternative to maintaining their own fleet of vehicles and the flexibility to choose the maintenance program that works for them.
|
•
|
Our customers have access to our extensive network of maintenance facilities and trained technicians for maintenance, vehicle repairs, 24-hour emergency roadside service, and replacement vehicles for vehicles that are temporarily out of service.
|
•
|
We typically retain vehicle residual risk exposure.
|
•
|
Customers have an opportunity to enhance their standard lease with additional fleet support services including our fuel and related services as described below; liability insurance coverage under our existing insurance policies and related insurance services; safety services including safety training, driver certification and loss prevention consulting; vehicle use and other tax reporting, permitting and licensing, and regulatory compliance (including hours of service administration); environmental services; and access to RydeSmart®, a full-featured GPS fleet location, tracking, and vehicle performance management system; and to RyderGuide®, our mobile fleet tool that provides customers with 24/7 access to key operational and maintenance management information about their fleets. In January 2020, we announced our plan to exit the extension of our liability insurance coverage for ChoiceLease customers. The exit of this program is estimated to be completed in the second quarter of 2021.
|
|
U.S.
|
Foreign
|
Total
|
|||||||||
|
Vehicles
|
Customers
|
Vehicles
|
Customers
|
Vehicles
|
Customers
|
||||||
ChoiceLease
|
136,100
|
12,200
|
23,700
|
2,400
|
159,800
|
14,600
|
||||||
Commercial rental (1)
|
36,000
|
32,200
|
5,900
|
5,000
|
41,900
|
37,200
|
||||||
SelectCare (2)
|
50,400
|
1,800
|
5,400
|
300
|
55,800
|
2,100
|
(1)
|
Commercial rental customers represent those who rented a vehicle for more than 3 days during the year and includes approximately 7,500 ChoiceLease customers
|
(2)
|
SelectCare customers include approximately 1,000 ChoiceLease customers
|
•
|
drive profitable fleet growth that maximizes our return on investment by (1) successfully implementing sales and marketing initiatives designed to compel private fleet operators and for-hire carriers to outsource all or some portion of their fleet management needs to us; (2) offering innovative products, solutions and support services that will create and strengthen new and existing customer relationships; and (3) completing targeted acquisitions;
|
•
|
deliver a consistent, industry-leading and cost-effective maintenance program to our customers through continued process improvement and re-design, productivity initiatives and technology improvements allowing us to obtain new business, including from our competitors; and
|
•
|
optimize asset utilization and management, particularly with respect to our rental fleet, used vehicle operations and maintenance facility infrastructure.
|
Supply Chain Solutions
|
•
|
provide customers with best in class execution and quality through reliable and flexible supply chain solutions;
|
•
|
develop innovative solutions and capabilities that drive value for our customers within our targeted industry verticals;
|
•
|
create a culture of innovation and collaboration to share capabilities and solutions to meet our clients' needs;
|
•
|
focus consistently on network optimization and continuous improvement; and
|
•
|
execute on targeted sales and marketing growth strategies.
|
Dedicated Transportation Solutions
|
•
|
increase market share with customers in the energy and utility, metals and mining, specialty retail, construction, and food and beverage industries;
|
•
|
leverage the support and talent of the FMS sales team to compel private fleet operators to outsource all or some of their transportation needs to us;
|
•
|
align the DTS business with other SCS product lines to create revenue opportunities and improve operating efficiencies in both segments; and
|
•
|
improve competitiveness in the non-specialized and non-integrated customer segments.
|
Name
|
Age
|
Position
|
||
Robert E. Sanchez
|
54
|
Chair and Chief Executive Officer
|
||
Scott T. Parker
|
52
|
Executive Vice President and Chief Financial Officer
|
||
John J. Diez
|
49
|
President, Global Fleet Management
|
||
J. Steven Sensing
|
52
|
President, Global Supply Chain Solutions and Dedicated Transportation Solutions
|
||
Robert D. Fatovic
|
54
|
Executive Vice President, Chief Legal Officer and Corporate Secretary
|
||
John Gleason
|
63
|
Executive Vice President and Chief Sales Officer
|
||
Karen M. Jones
|
57
|
Executive Vice President and Chief Marketing Officer
|
||
Frank Lopez
|
45
|
Executive Vice President and Chief Human Resources Officer
|
||
Tim Fiore
|
64
|
Senior Vice President and Chief Procurement Officer
|
||
Rajeev Ravindran
|
54
|
Senior Vice President and Chief Information Officer
|
||
Frank Mullen
|
50
|
Vice President and Controller
|
•
|
with respect to our SCS contracts, the scope of services, production volumes, operational efficiencies, the mix of fixed versus variable costs, productivity and other factors;
|
•
|
with respect to our DTS contracts, market wages, availability of labor, insurance rates and other operating costs that experience market fluctuations; and
|
•
|
with respect to our ChoiceLease and SelectCare contracts, residual values (ChoiceLease only) and maintenance expense.
|
•
|
companies we acquire may not have historically maintained internal controls, policies or procedures to monitor compliance with the regulatory and legal requirements consistent with our standards;
|
•
|
our operations in Canada, Europe and Mexico may expose us to liability for failure to comply with local laws and regulatory requirements of foreign jurisdictions, which may vary significantly from country to country, including local tax laws, and anti-bribery laws;
|
•
|
compliance with environmental laws and regulations, including regulations imposed by the EPA on exhaust emissions and increasingly stringent regulations related to climate change, which may impose restrictions on our activities or require us to take certain actions, all of which may, over time, increase our costs and adversely affect our business and results of operations;
|
•
|
compliance with health and safety laws and regulations imposed by OSHA; and
|
•
|
compliance with new laws or regulations that may change the employee/independent contractor classification of independent contractors doing business with us, which could cause us to incur additional exposure under federal and state tax and employment laws.
|
•
|
our inability to obtain expected customer retention levels or profitability;
|
•
|
we compete with many other transportation and logistics service providers, some of which have greater capital resources or lower cost structures than we do;
|
•
|
our inability to compete with new entrants in the transportation and logistics market that may offer similar services at lower cost or have greater technological capabilities;
|
•
|
customers may choose to provide the services we provide for themselves;
|
•
|
our competitors may periodically reduce their prices to gain business, especially during times of declining economic growth, which may limit our ability to maintain or increase prices or impede our ability to maintain our profitability or grow our market share or profitability;
|
•
|
many customers periodically accept bids from multiple carriers for their shipping needs, and this process may depress rates or result in the loss of some of our business to competitors;
|
•
|
the continuing trend toward consolidation in the trucking industry may result in larger carriers with greater financial resources than we have;
|
•
|
advances in technology require increased investments to remain competitive, and our customers may not be willing to accept higher prices to cover the cost of these investments; and
|
•
|
because cost of capital is a significant competitive factor, any increase in either the cost of our debt or equity as a result of reductions in our debt rating or stock price volatility could have a significant impact on our competitive position.
|
•
|
restricted access to capital and an increased cost of capital;
|
•
|
diminished liquidity and credit availability resulting in higher short- or long-term borrowing costs and more stringent borrowing terms;
|
•
|
unanticipated interest rate and currency exchange rate fluctuations; and
|
•
|
increased risk of default by counterparties under derivative instruments and hedging agreements.
|
•
|
changes in tariffs, trade restrictions, trade agreements and taxes;
|
•
|
varying tax regimes, including consequences from changes in applicable tax laws;
|
•
|
difficulties in managing or overseeing foreign operations and agents;
|
•
|
foreign currency fluctuations and limitations on the repatriation of funds due to foreign currency controls;
|
•
|
different liability standards;
|
•
|
the price and availability of fuel;
|
•
|
national and international conflict; and
|
•
|
intellectual property laws of countries that do not protect our rights in intellectual property to the same extent as the laws of the U.S.
|
•
|
actual or anticipated variations in earnings, financial or operating performance or liquidity;
|
•
|
changes in analysts’ recommendations or projections;
|
•
|
failure to meet analysts’ and our Company's projections;
|
•
|
general political, social, economic and capital market conditions;
|
•
|
announcements of developments or initiatives related to our business;
|
•
|
operating and stock performance of other companies deemed to be peers;
|
•
|
actions by government regulators; and
|
•
|
news reports of trends, concerns and other issues related to us or our industry, including changes in regulations.
|
Total Number
of Shares
Purchased (1)
|
Average Price
Paid per
Share
|
Total Number of
Shares Purchased as
Part of Publicly Announced Programs (2)
|
Maximum Number
of Shares That May
Yet Be Purchased
Under the Anti-Dilutive
Programs (2)
|
||||||||||
October 1 through October 31, 2019
|
73
|
|
$
|
51.50
|
|
—
|
|
667,372
|
|
||||
November 1 through November 30, 2019
|
63,621
|
|
51.22
|
|
63,621
|
|
603,751
|
|
|||||
December 1 through December 31, 2019
|
548
|
|
53.23
|
|
—
|
|
1,500,000
|
|
|||||
Total
|
64,242
|
|
$
|
51.24
|
|
63,621
|
|
(1)
|
During the three months ended December 31, 2019, we purchased an aggregate of 621 shares of our common stock in employee-related transactions. Employee-related transactions may include: (i) shares of common stock delivered as payment for the exercise price of options exercised or to satisfy the option holders’ tax withholding liability associated with our share-based compensation programs and (ii) open-market purchases by the trustee of Ryder’s deferred compensation plans relating to investments by employees in our stock, one of the investment options available under the plans.
|
(2)
|
In December 2017, our Board of Directors authorized a share repurchase program intended to mitigate the dilutive impact of shares issued under our employee stock plans (the program). Under the program, management was authorized to repurchase up to 1.5 million shares of common stock. The 2-year program expired in December 2019.
|
|
Years ended December 31
|
|||||||||||||||||||
|
2019
|
2018
|
2017
|
2016
|
2015
|
|||||||||||||||
|
(In thousands, except per share amounts and other data)
|
|||||||||||||||||||
Operating Data:
|
||||||||||||||||||||
Total revenue
|
$
|
8,925,801
|
|
$
|
8,413,946
|
|
$
|
7,280,074
|
|
$
|
6,758,138
|
|
$
|
6,571,893
|
|
|||||
Operating revenue (1)
|
7,224,332
|
|
6,698,116
|
|
6,022,505
|
|
5,790,897
|
|
5,561,077
|
|
||||||||||
Earnings (loss) from continuing operations (2)
|
(23,272
|
)
|
286,922
|
|
720,101
|
|
265,232
|
|
305,989
|
|
||||||||||
Comparable earnings from continuing operations (3)
|
53,554
|
|
314,781
|
|
225,187
|
|
291,080
|
|
326,485
|
|
||||||||||
Net earnings (loss) (2), (4)
|
(24,410
|
)
|
284,613
|
|
719,644
|
|
263,069
|
|
304,768
|
|
||||||||||
Per Share Data:
|
||||||||||||||||||||
Earnings (loss) from continuing operations — Diluted (2)
|
$
|
(0.45
|
)
|
$
|
5.43
|
|
$
|
13.54
|
|
$
|
4.95
|
|
$
|
5.73
|
|
|||||
Comparable earnings from continuing operations — Diluted (3)
|
1.01
|
|
5.95
|
|
4.23
|
|
5.43
|
|
6.10
|
|
||||||||||
Net earnings (loss) — Diluted (2), (4)
|
(0.47
|
)
|
5.38
|
|
13.53
|
|
4.91
|
|
5.71
|
|
||||||||||
Cash dividends
|
2.20
|
|
2.12
|
|
1.80
|
|
1.70
|
|
1.56
|
|
||||||||||
Book value (5)
|
46.48
|
|
47.75
|
|
46.33
|
|
38.49
|
|
37.15
|
|
||||||||||
Financial Data:
|
||||||||||||||||||||
Total debt
|
$
|
7,924,788
|
|
$
|
6,649,277
|
|
$
|
5,440,006
|
|
$
|
5,391,274
|
|
$
|
5,502,627
|
|
|||||
Shareholders’ equity (5)
|
2,476,310
|
|
2,536,568
|
|
2,453,577
|
|
2,057,620
|
|
1,987,111
|
|
||||||||||
Debt to equity (5)
|
320
|
%
|
262
|
%
|
222
|
%
|
262
|
%
|
277
|
%
|
||||||||||
Adjusted return on equity (5), (6), (7)
|
0.3
|
%
|
12.7
|
%
|
11.1
|
%
|
13.2
|
%
|
16.5
|
%
|
||||||||||
Adjusted return on capital (5), (6), (8)
|
1.9
|
%
|
5.2
|
%
|
4.2
|
%
|
4.8
|
%
|
5.8
|
%
|
||||||||||
Cash Flow Data:
|
||||||||||||||||||||
Net cash provided by (used in):
|
||||||||||||||||||||
Operating activities from continuing operations
|
$
|
2,140,539
|
|
$
|
1,717,993
|
|
$
|
1,628,098
|
|
$
|
1,601,022
|
|
$
|
1,441,788
|
|
|||||
Investing activities from continuing operations
|
(3,217,193
|
)
|
(2,821,459
|
)
|
(1,438,676
|
)
|
(1,407,347
|
)
|
(2,161,355
|
)
|
||||||||||
Financing activities from continuing operations
|
1,084,139
|
|
1,085,515
|
|
(162,055
|
)
|
(185,922
|
)
|
731,485
|
|
||||||||||
Free cash flow (9)
|
(1,076,654
|
)
|
(936,094
|
)
|
196,662
|
|
193,675
|
|
(727,714
|
)
|
||||||||||
Capital expenditures paid
|
3,735,174
|
|
3,050,409
|
|
1,860,436
|
|
1,905,157
|
|
2,667,978
|
|
||||||||||
Other Data:
|
||||||||||||||||||||
Number of vehicles — Owned and leased
|
213,800
|
|
201,600
|
|
186,200
|
|
185,100
|
|
185,200
|
|
(1)
|
Non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section in Item 7 of this Annual Report for a reconciliation of total revenue to operating revenue, as well as the reasons management believes these measures are important to investors.
|
(2)
|
Amounts in 2017 reflect a tax benefit as a result of the 2017 Tax Cuts and Jobs Act. Refer to Note 12 , "Income Taxes", for additional information.
|
(3)
|
Non-GAAP financial measures. Refer to the “Non-GAAP Financial Measures” section in Item 7 of this Annual Report for a reconciliation of net earnings from continuing operations to comparable earnings from continuing operations and net earnings from continuing operations per diluted common share to comparable earnings per diluted common share, as well as the reasons management believes these measures are important to investors.
|
(4)
|
Net earnings in 2019, 2018, 2017, 2016 and 2015 included losses from discontinued operations of $1 million, or $0.03 per diluted common share, $2 million, or $0.04 per diluted common share, $0.5 million, or $0.01 per diluted common share, $2 million, or $0.04 per diluted common share, and $1 million, or $0.02 per diluted common share, respectively.
|
(5)
|
Shareholders’ equity as of December 31, 2019, 2018, 2017, 2016 and 2015 reflected cumulative after-tax equity charges of $667 million, $712 million, $567 million, $627 million, and $577 million, respectively, related to our pension and postretirement plans.
|
(6)
|
Amounts were computed primarily using an 5-point average based on quarterly information.
|
(7)
|
Non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section in Item 7 of this Annual Report for a reconciliation of the non-GAAP elements of this calculation and a numerical reconciliation of net earnings to adjusted net earnings and average shareholders' equity to adjusted average equity used to calculate adjusted return on equity, as well as the reasons management believes these measures are important to investors.
|
(8)
|
Non-GAAP financial measure. Refer to the “Non-GAAP Financial Measures” section in Item 7 of this Annual Report for a reconciliation of the non-GAAP elements of this calculation and a numerical reconciliation of net earnings to adjusted net earnings and average total debt and average shareholders' equity to adjusted average total capital used to calculate adjusted return on capital, as well as the reasons management believes these measures are important to investors.
|
(9)
|
Non-GAAP financial measure. Refer to the “Non-GAAP financial measures” section in Item 7 of this Annual Report for a reconciliation of net cash provided by operating activities to free cash flow, as well as the reasons why management believes this measure is important to investors.
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands, except per share amounts)
|
|
|
|||||||||||||
Total revenue
|
$
|
8,925,801
|
|
$
|
8,413,946
|
|
$
|
7,280,074
|
|
6%
|
16%
|
|||||
Operating revenue (1)
|
7,224,332
|
|
6,698,116
|
|
6,022,505
|
|
8
|
11
|
||||||||
Earnings (loss) from continuing operations before income taxes (EBT)
|
$
|
(42,271
|
)
|
$
|
389,469
|
|
$
|
296,436
|
|
NM
|
31%
|
|||||
Comparable EBT (2)
|
56,089
|
|
418,862
|
|
348,257
|
|
(87)
|
20
|
||||||||
Earnings (loss) from continuing operations (3)
|
(23,272
|
)
|
286,922
|
|
720,101
|
|
NM
|
(60)
|
||||||||
Comparable earnings from continuing operations (2)
|
53,554
|
|
314,781
|
|
225,187
|
|
(83)
|
40
|
||||||||
Net earnings (loss) (3)
|
(24,410
|
)
|
284,613
|
|
719,644
|
|
NM
|
(60)
|
||||||||
Earnings (loss) per common share (EPS) — Diluted
|
||||||||||||||||
Continuing operations (3)
|
$
|
(0.45
|
)
|
$
|
5.43
|
|
$
|
13.54
|
|
NM
|
(60)%
|
|||||
Comparable (2)
|
1.01
|
|
5.95
|
|
4.23
|
|
(83)
|
41
|
||||||||
Net earnings (loss) (3)
|
(0.47
|
)
|
5.38
|
|
13.53
|
|
NM
|
(60)
|
(1)
|
Non-GAAP financial measure. Refer to the“Non-GAAP Financial Measures” section of this MD&A for a reconciliation of total revenue to operating revenue and the reasons why management believes this measure is important to investors.
|
(2)
|
Non-GAAP financial measures. Refer to the “Non-GAAP Financial Measures” section for a reconciliation of EBT, earnings (loss) from continuing operations and earnings (loss) from continuing operations per diluted common share to the comparable measures and the reasons why management believes these measures are important to investors.
|
(3)
|
2017 amounts reflect a total tax provision benefit of $424 million, which includes the impact from the 2017 Tax Cuts and Jobs Act. Refer to Note 12 , "Income Taxes ," in the Notes to Consolidated Financial Statements for additional information.
|
|
2019/2018
|
2018/2017
|
||||||
|
Total
|
Operating
|
Total
|
Operating
|
||||
Organic, including price and volume
|
5%
|
8%
|
12%
|
10%
|
||||
Acquisitions
|
1
|
—
|
2
|
1
|
||||
Fuel
|
—
|
—
|
2
|
—
|
||||
Total increase
|
6%
|
8%
|
16%
|
11%
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
|
2018/2017
|
||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Lease & related maintenance and rental revenues
|
$
|
3,784,744
|
|
$
|
3,512,867
|
|
$
|
3,220,705
|
|
8%
|
9%
|
|||||
Cost of lease & related maintenance and rental
|
3,103,703
|
|
2,555,358
|
|
2,353,209
|
|
21
|
9
|
||||||||
Gross margin
|
$
|
681,041
|
|
$
|
957,509
|
|
$
|
867,496
|
|
(29)%
|
10%
|
|||||
Gross margin %
|
18
|
%
|
27
|
%
|
27
|
%
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Services revenue
|
$
|
4,555,692
|
|
$
|
4,280,834
|
|
$
|
3,538,869
|
|
6%
|
21%
|
|||||
Cost of services
|
3,879,863
|
|
3,663,348
|
|
2,977,426
|
|
6
|
23
|
||||||||
Gross margin
|
$
|
675,829
|
|
$
|
617,486
|
|
$
|
561,443
|
|
9%
|
10%
|
|||||
Gross margin %
|
15
|
%
|
14
|
%
|
16
|
%
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Fuel services revenue
|
$
|
585,365
|
|
$
|
620,245
|
|
$
|
520,500
|
|
(6)%
|
19%
|
|||||
Cost of fuel services
|
571,658
|
|
605,613
|
|
507,440
|
|
(6)
|
19
|
||||||||
Gross margin
|
$
|
13,707
|
|
$
|
14,632
|
|
$
|
13,060
|
|
(6)%
|
12%
|
|||||
Gross margin %
|
2
|
%
|
2
|
%
|
3
|
%
|
|
Change
|
|||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Other operating expenses
|
$
|
121,980
|
|
$
|
123,964
|
|
$
|
115,019
|
|
(2)%
|
8%
|
|
|
|
|
Change
|
||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Selling, general and administrative expenses (SG&A)
|
$
|
907,449
|
|
$
|
849,410
|
|
$
|
870,918
|
|
7%
|
(2)%
|
|||||
Percentage of total revenue
|
10%
|
10%
|
12%
|
|
|
|
|
Change
|
||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Non-operating pension costs
|
$
|
|
|
$
|
|
|
$
|
|
|
NM
|
NM
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Losses on used vehicle sales, net
|
$
|
58,706
|
|
$
|
22,325
|
|
$
|
16,989
|
|
NM
|
31%
|
Proceeds per unit change
|
|||
2019/2018
|
2018/2017
|
||
Tractors
|
(3)%
|
12%
|
|
Trucks
|
(6)%
|
9%
|
|
|
|
|
Change
|
||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Interest expense
|
$
|
241,381
|
|
$
|
180,488
|
|
$
|
141,876
|
|
34%
|
27%
|
|||||
Effective interest rate
|
3.3%
|
3.0%
|
2.6%
|
Change
|
||||||||||||||||
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
||||||||||||
|
(In thousands)
|
|||||||||||||||
Miscellaneous (income) loss, net
|
$
|
(33,642
|
)
|
$
|
(5,422
|
)
|
$
|
(44,245
|
)
|
NM
|
NM
|
Change
|
||||||||||||||||
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
||||||||||||
|
(In thousands)
|
|||||||||||||||
Restructuring and other items, net
|
$
|
56,568
|
|
$
|
21,852
|
|
$
|
17,265
|
|
NM
|
27%
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Provision for (benefit from) income taxes
|
$
|
(18,999
|
)
|
$
|
102,547
|
|
$
|
(423,665
|
)
|
NM
|
NM
|
|||||
Effective tax rate from continuing operations
|
44.9%
|
26.3%
|
(142.9)%
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Revenue:
|
||||||||||||||||
Fleet Management Solutions
|
$
|
5,571,403
|
|
$
|
5,258,693
|
|
$
|
4,716,541
|
|
6%
|
11%
|
|||||
Supply Chain Solutions
|
2,551,271
|
|
2,398,144
|
|
1,937,352
|
|
6
|
24
|
||||||||
Dedicated Transportation Solutions
|
1,417,483
|
|
1,333,313
|
|
1,095,645
|
|
6
|
22
|
||||||||
Eliminations
|
(614,356
|
)
|
(576,204
|
)
|
(469,464
|
)
|
(7)
|
(23)
|
||||||||
Total
|
$
|
8,925,801
|
|
$
|
8,413,946
|
|
$
|
7,280,074
|
|
6%
|
16%
|
|||||
Operating Revenue: (1)
|
||||||||||||||||
Fleet Management Solutions
|
$
|
4,755,041
|
|
$
|
4,411,038
|
|
$
|
4,026,732
|
|
8%
|
10%
|
|||||
Supply Chain Solutions
|
1,879,965
|
|
1,765,336
|
|
1,507,548
|
|
6
|
17
|
||||||||
Dedicated Transportation Solutions
|
972,694
|
|
870,537
|
|
789,294
|
|
12
|
10
|
||||||||
Eliminations
|
(383,368
|
)
|
(348,795
|
)
|
(301,069
|
)
|
(10)
|
(16)
|
||||||||
Total
|
$
|
7,224,332
|
|
$
|
6,698,116
|
|
$
|
6,022,505
|
|
8%
|
11%
|
|||||
Earnings (Loss) Before Taxes:
|
||||||||||||||||
Fleet Management Solutions
|
$
|
(70,274
|
)
|
$
|
340,038
|
|
$
|
295,618
|
|
NM
|
15%
|
|||||
Supply Chain Solutions
|
145,060
|
|
130,262
|
|
98,825
|
|
11
|
32
|
||||||||
Dedicated Transportation Solutions
|
81,149
|
|
61,236
|
|
55,346
|
|
33
|
11
|
||||||||
Eliminations
|
(50,732
|
)
|
(63,593
|
)
|
(53,273
|
)
|
20
|
(19)
|
||||||||
105,203
|
|
467,943
|
|
396,516
|
|
(78)
|
18
|
|||||||||
Unallocated Central Support Services
|
(49,114
|
)
|
(49,081
|
)
|
(48,259
|
)
|
—
|
(2)
|
||||||||
Non-operating pension costs
|
(60,406
|
)
|
(7,541
|
)
|
(27,741
|
)
|
NM
|
73
|
||||||||
Other items impacting comparability, net (2)
|
(37,954
|
)
|
(21,852
|
)
|
(24,080
|
)
|
(74)
|
9
|
||||||||
Earnings (loss) from continuing operations before income taxes
|
$
|
(42,271
|
)
|
$
|
389,469
|
|
$
|
296,436
|
|
NM
|
31%
|
(1)
|
Non-GAAP financial measures. Refer to the “Non-GAAP Financial Measures” section of this MD&A for a reconciliation of total revenue to operating revenue and segment total revenue to segment operating revenue for FMS, SCS and DTS, as well as the reasons why management believes these measures are important to investors.
|
(2)
|
Refer to Note 22, "Other Items Impacting Comparability," and below for a discussion of items excluded from our primary measure of segment performance.
|
Change
|
|||||||||||||||
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
(In thousands)
|
|||||||||||||||
Equipment Contribution:
|
|||||||||||||||
Supply Chain Solutions
|
$
|
22,267
|
|
$
|
27,067
|
|
$
|
22,244
|
|
(18)%
|
22%
|
||||
Dedicated Transportation Solutions
|
28,465
|
|
36,526
|
|
31,029
|
|
(22)
|
18
|
|||||||
Total (1)
|
$
|
50,732
|
|
$
|
63,593
|
|
$
|
53,273
|
|
(20)%
|
19%
|
(1)
|
Total amount is included in FMS EBT.
|
|
|
|||||||||||||
Description
|
Classification
|
2019
|
2018
|
2017
|
||||||||||
|
|
(In thousands)
|
||||||||||||
Restructuring and other, net (1)
|
Restructuring and other items, net
|
$
|
(20,532
|
)
|
$
|
(5,597
|
)
|
$
|
(6,360
|
)
|
||||
Goodwill impairment (2)
|
Restructuring and other items, net
|
—
|
|
(15,513
|
)
|
—
|
|
|||||||
ERP implementation costs (1)
|
Restructuring and other items, net
|
(21,260
|
)
|
(742
|
)
|
—
|
|
|||||||
Costs related to cost savings initiatives (1)
|
Restructuring and other items, net
|
(14,776
|
)
|
—
|
|
(10,905
|
)
|
|||||||
Tax reform related bonus (3)
|
SG&A
|
—
|
|
—
|
|
(23,278
|
)
|
|||||||
Pension related adjustment (4)
|
SG&A
|
—
|
|
—
|
|
(5,454
|
)
|
|||||||
Operating tax adjustment (3)
|
SG&A
|
—
|
|
—
|
|
(2,205
|
)
|
|||||||
Gain on sale of property (5)
|
Miscellaneous income
|
18,614
|
|
—
|
|
24,122
|
|
|||||||
Other items impacting comparability, net
|
(37,954
|
)
|
(21,852
|
)
|
(24,080
|
)
|
||||||||
Non-operating pension costs (4)
|
Non-operating pension costs
|
(60,406
|
)
|
(7,541
|
)
|
(27,741
|
)
|
|||||||
$
|
(98,360
|
)
|
$
|
(29,393
|
)
|
$
|
(51,821
|
)
|
(1)
|
See Note 5, "Restructuring and Other Items, Net," in the Notes to Consolidated Financial Statements for additional information.
|
(2)
|
See Note 10, "Goodwill," in the Notes to Consolidated Financial Statements for additional information.
|
(3)
|
See Note 22, “Other Items Impacting Comparability,” in the Notes to Consolidated Financial Statements for additional information.
|
(4)
|
See Note 20, “Employee Benefit Plans,” in the Notes to Consolidated Financial Statements for additional information.
|
(5)
|
See Note 25, "Miscellaneous Income, Net" in the Notes to Consolidated Financial Statements for additional information.
|
|
Change
|
|||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
|
2018/2017
|
||||||||||
|
(In thousands)
|
|
||||||||||||||
ChoiceLease
|
$
|
3,112,311
|
|
$
|
2,860,266
|
|
$
|
2,671,687
|
|
9%
|
7%
|
|||||
SelectCare
|
541,358
|
|
502,835
|
|
464,056
|
|
8
|
8
|
||||||||
Commercial rental
|
1,009,086
|
|
960,606
|
|
813,539
|
|
5
|
18
|
||||||||
Other
|
92,286
|
|
87,331
|
|
77,450
|
|
6
|
13
|
||||||||
Fuel services revenue
|
816,362
|
|
847,655
|
|
689,809
|
|
(4)
|
23
|
||||||||
FMS total revenue (1)
|
$
|
5,571,403
|
|
$
|
5,258,693
|
|
$
|
4,716,541
|
|
6%
|
11%
|
|||||
FMS operating revenue (2)
|
$
|
4,755,041
|
|
$
|
4,411,038
|
|
$
|
4,026,732
|
|
8%
|
10%
|
|||||
FMS EBT
|
$
|
(70,274
|
)
|
$
|
340,038
|
|
$
|
295,618
|
|
NM
|
15%
|
|||||
FMS EBT as a % of FMS total revenue
|
(1.3)%
|
6.5%
|
6.3%
|
(780) bps
|
20 bps
|
|||||||||||
FMS EBT as a % of FMS operating revenue (2)
|
(1.5)%
|
7.7%
|
7.3%
|
(920) bps
|
40 bps
|
(1)
|
Includes intercompany fuel sales from FMS to SCS and DTS.
|
(2)
|
Non-GAAP financial measures. Reconciliations of FMS total revenue to FMS operating revenue and FMS EBT as a % of FMS total revenue to FMS EBT as a % of FMS operating revenue, as well as the reasons why management believes these measures are important to investors, are included in the “Non-GAAP Financial Measures” section of this MD&A.
|
|
2019/2018
|
2018/2017
|
||||||
|
Total
|
Operating (1)
|
Total
|
Operating (1)
|
||||
Organic, including price and volume
|
7%
|
8%
|
8%
|
10%
|
||||
Fuel
|
(1)
|
—
|
3
|
—
|
||||
Total increase
|
6%
|
8%
|
11%
|
10%
|
(1)
|
Non-GAAP financial measure. A reconciliation of FMS total revenue to FMS operating revenue, as well as the reasons why management believes this measure is important to investors, is included in the "Non-GAAP Financial Measures" section of this MD&A.
|
|
Change
|
|||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands, except vehicle counts)
|
|
|
|||||||||||||
Rental revenue from non-lease customers (1)
|
$
|
609,840
|
|
$
|
566,612
|
|
$
|
517,874
|
|
8%
|
9%
|
|||||
Rental revenue from lease customers (2)
|
$
|
399,246
|
|
$
|
393,994
|
|
$
|
295,665
|
|
1%
|
33%
|
|||||
Average commercial rental power fleet size – in service (3), (4)
|
36,000
|
32,800
|
29,700
|
10%
|
10%
|
|||||||||||
Commercial rental utilization – power fleet (3)
|
75.0%
|
79.2%
|
75.6%
|
(420) bps
|
360 bps
|
(1)
|
Also includes additional vehicles rented to lease customers, incremental to the lease fleet.
|
(2)
|
Represents revenue from rental vehicles provided to our existing ChoiceLease customers, generally in place of a lease vehicle.
|
(3)
|
Number of units rounded to nearest hundred and calculated using quarterly average unit counts.
|
(4)
|
Excluding trailers.
|
|
|
|
|
Change
|
||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||
End of period vehicle count
|
||||||||||
By type:
|
||||||||||
Trucks (1)
|
85,200
|
81,700
|
76,400
|
4%
|
7%
|
|||||
Tractors (2)
|
82,400
|
74,000
|
66,000
|
11
|
12
|
|||||
Trailers (3)
|
45,400
|
44,700
|
42,600
|
2
|
5
|
|||||
Other
|
800
|
1,200
|
1,200
|
(33)
|
—
|
|||||
Total
|
213,800
|
201,600
|
186,200
|
6%
|
8%
|
|||||
By product line:
|
|
|
||||||||
ChoiceLease
|
159,800
|
149,300
|
139,100
|
7%
|
7%
|
|||||
Commercial rental
|
41,900
|
42,600
|
37,800
|
(2)
|
13
|
|||||
Service vehicles and other
|
2,700
|
2,800
|
3,300
|
(4)
|
(15)
|
|||||
204,400
|
194,700
|
180,200
|
5
|
8
|
||||||
Held for sale
|
9,400
|
6,900
|
6,000
|
36
|
15
|
|||||
Total
|
213,800
|
201,600
|
186,200
|
|
6%
|
8%
|
||||
Active ChoiceLease vehicles
|
147,400
|
139,200
|
131,000
|
6%
|
6%
|
|||||
Customer vehicles under SelectCare contracts
|
55,800
|
56,300
|
54,400
|
(1)%
|
3%
|
|||||
Average vehicle count
|
|
|
||||||||
By product line:
|
|
|
||||||||
ChoiceLease
|
156,600
|
143,100
|
137,600
|
9%
|
4%
|
|||||
Commercial rental
|
44,100
|
41,000
|
37,500
|
8
|
9
|
|||||
Service vehicles and other
|
2,700
|
3,100
|
3,400
|
(13)
|
(9)
|
|||||
203,400
|
187,200
|
178,500
|
|
9
|
5
|
|||||
Held for sale
|
7,800
|
6,100
|
6,700
|
28
|
(9)
|
|||||
Total
|
211,200
|
193,300
|
185,200
|
9%
|
4%
|
|||||
Active ChoiceLease vehicles (4)
|
144,300
|
134,400
|
129,300
|
7%
|
4%
|
|||||
Revenue per active ChoiceLease vehicle
|
$21,600
|
$21,300
|
$20,700
|
1%
|
3%
|
|||||
Customer vehicles under SelectCare contracts
|
56,300
|
55,600
|
52,100
|
1%
|
7%
|
|||||
Customer vehicles under SelectCare on-demand (5)
|
23,200
|
23,200
|
24,500
|
—%
|
(5)%
|
|||||
Total vehicles serviced
|
290,700
|
272,100
|
261,800
|
7%
|
4%
|
(1)
|
Generally comprised of Class 1 through Class 7 type vehicles with a Gross Vehicle Weight (GVW) up to 33,000 pounds.
|
(2)
|
Generally comprised of over the road on highway tractors and are primarily comprised of Class 8 type vehicles with a GVW of over 33,000 pounds.
|
(3)
|
Generally comprised of dry, flatbed and refrigerated type trailers.
|
(4)
|
Active ChoiceLease vehicles are calculated as those units currently earning revenue and not classified as not yet earning or no longer earning units.
|
(5)
|
Comprised of the number of unique vehicles serviced under on-demand maintenance agreements. This does not represent averages for the periods. Vehicles included in the end of period count may have been serviced more than one time during the respective annual period.
|
Note:
|
Average vehicle counts were computed using a 24-point average based on monthly information.
|
|
December 31,
|
Change
|
||||||||
Number of Units
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||
Not yet earning revenue (NYE)
|
3,500
|
4,500
|
2,900
|
(22)%
|
55%
|
|||||
No longer earning revenue (NLE):
|
||||||||||
Units held for sale
|
9,400
|
6,900
|
6,000
|
36
|
15
|
|||||
Other NLE units
|
8,400
|
4,300
|
3,400
|
95
|
26
|
|||||
Total NLE
|
17,800
|
11,200
|
9,400
|
59%
|
19%
|
|||||
Total
|
21,300
|
15,700
|
12,300
|
36%
|
28%
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands, except vehicle counts)
|
|
|
|||||||||||||
Automotive
|
$
|
693,211
|
|
$
|
628,766
|
|
$
|
566,302
|
|
10%
|
11%
|
|||||
Technology and healthcare
|
268,305
|
|
329,843
|
|
271,551
|
|
(19)
|
21
|
||||||||
Consumer product goods and retail
|
736,083
|
|
637,244
|
|
511,793
|
|
16
|
25
|
||||||||
Industrial and other
|
182,366
|
|
169,483
|
|
157,902
|
|
8
|
7
|
||||||||
Subcontracted transportation
|
554,678
|
|
521,028
|
|
354,644
|
|
6
|
47
|
||||||||
Fuel
|
116,628
|
|
111,780
|
|
75,160
|
|
4
|
49
|
||||||||
SCS total revenue
|
$
|
2,551,271
|
|
$
|
2,398,144
|
|
$
|
1,937,352
|
|
6%
|
24%
|
|||||
SCS operating revenue (1)
|
$
|
1,879,965
|
|
$
|
1,765,336
|
|
$
|
1,507,548
|
|
6%
|
17%
|
|||||
SCS EBT
|
$
|
145,060
|
|
$
|
130,262
|
|
$
|
98,825
|
|
11%
|
32%
|
|||||
SCS EBT as a % of SCS total revenue
|
5.7%
|
5.4%
|
5.1%
|
30 bps
|
30 bps
|
|||||||||||
SCS EBT as a % of SCS operating revenue(1)
|
7.7%
|
7.4%
|
6.6%
|
30 bps
|
80 bps
|
|||||||||||
Memo:
|
||||||||||||||||
Average fleet
|
9,700
|
8,800
|
7,900
|
10%
|
11%
|
(1)
|
Non-GAAP financial measures. Reconciliations of SCS total revenue to SCS operating revenue and SCS EBT as a % of SCS total revenue to SCS EBT as a % of SCS operating revenue, as well as the reasons why management believes these measures are important to investors, are included in the “Non-GAAP Financial Measures” section of this MD&A.
|
|
2019/2018
|
2018/2017
|
||||||
|
Total
|
Operating (1)
|
Total
|
Operating (1)
|
||||
Organic, including price and volume
|
4%
|
5%
|
14%
|
12%
|
||||
Acquisition
|
2
|
1
|
8
|
5
|
||||
Fuel
|
—
|
—
|
2
|
—
|
||||
Total increase
|
6%
|
6%
|
24%
|
17%
|
(1)
|
Non-GAAP financial measure. A reconciliation of SCS total revenue to SCS operating revenue, as well as the reasons why management believes this measure is important to investors is included in the "Non-GAAP Financial Measures" section of this MD&A.
|
|
Change
|
|||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
DTS total revenue
|
$
|
1,417,483
|
|
$
|
1,333,313
|
|
$
|
1,095,645
|
|
6%
|
22%
|
|||||
DTS operating revenue (1)
|
$
|
972,694
|
|
$
|
870,537
|
|
$
|
789,294
|
|
12%
|
10%
|
|||||
DTS EBT
|
$
|
81,149
|
|
$
|
61,236
|
|
$
|
55,346
|
|
33%
|
11%
|
|||||
DTS EBT as a % of DTS total revenue
|
5.7%
|
4.6%
|
5.1%
|
110 bps
|
(50) bps
|
|||||||||||
DTS EBT as a % of DTS operating revenue(1)
|
8.3%
|
7.0%
|
7.0%
|
130 bps
|
—
|
|||||||||||
Memo:
|
||||||||||||||||
Average fleet
|
9,600
|
8,900
|
8,200
|
8%
|
9%
|
(1)
|
Non-GAAP financial measures. Reconciliations of DTS total revenue to DTS operating revenue and DTS EBT as a % of DTS total revenue to DTS EBT as a % of DTS operating revenue, as well as the reasons why management believes these measures are important to investors are included in the “Non-GAAP Financial Measures” section of this MD&A.
|
|
2019/2018
|
2018/2017
|
||||||
Total
|
Operating (1)
|
Total
|
Operating (1)
|
|||||
Organic, including price and volume
|
8%
|
12%
|
19%
|
10%
|
||||
Subcontracted transportation
|
(1)
|
—
|
—
|
—
|
||||
Fuel
|
(1)
|
—
|
3
|
—
|
||||
Total increase
|
6%
|
12%
|
22%
|
10%
|
(1)
|
Non-GAAP financial measure. A reconciliation of DTS total revenue to DTS operating revenue, as well as the reasons why management believes this measure is important to investors is included in the "Non-GAAP Financial Measures" section of this MD&A.
|
|
|
Change
|
||||||||||||||
|
2019
|
2018
|
2017
|
2019/2018
|
2018/2017
|
|||||||||||
|
(In thousands)
|
|
|
|||||||||||||
Human resources
|
$
|
21,447
|
|
$
|
20,082
|
|
$
|
18,947
|
|
7%
|
6%
|
|||||
Finance and procurement
|
74,382
|
|
70,921
|
|
68,929
|
|
5
|
3
|
||||||||
Corporate services and public affairs
|
11,103
|
|
11,583
|
|
12,561
|
|
(4)
|
(8)
|
||||||||
Information technology
|
98,756
|
|
90,083
|
|
89,453
|
|
10
|
1
|
||||||||
Legal and safety
|
28,626
|
|
25,969
|
|
25,388
|
|
10
|
2
|
||||||||
Marketing
|
22,356
|
|
18,287
|
|
16,927
|
|
22
|
8
|
||||||||
Other
|
34,798
|
|
37,725
|
|
35,788
|
|
(8)
|
5
|
||||||||
Total CSS
|
291,468
|
|
274,650
|
|
267,993
|
|
6
|
2
|
||||||||
Allocation of CSS to business segments
|
(242,354
|
)
|
(225,569
|
)
|
(219,734
|
)
|
7
|
3
|
||||||||
Unallocated CSS
|
$
|
49,114
|
|
$
|
49,081
|
|
$
|
48,259
|
|
—%
|
2%
|
Years ended December 31,
|
||||||||||||
2019
|
2018
|
2017
|
||||||||||
|
(In thousands)
|
|||||||||||
Net cash provided by (used in):
|
||||||||||||
Operating activities
|
$
|
2,140,539
|
|
$
|
1,717,993
|
|
$
|
1,628,098
|
|
|||
Investing activities
|
(3,217,193
|
)
|
(2,821,459
|
)
|
(1,438,676
|
)
|
||||||
Financing activities
|
1,084,139
|
|
1,085,515
|
|
(162,055
|
)
|
||||||
Effect of exchange rates on cash
|
(4,272
|
)
|
4,694
|
|
(5,539
|
)
|
||||||
Net change in cash and cash equivalents
|
$
|
3,213
|
|
$
|
(13,257
|
)
|
$
|
21,828
|
|
|||
Years ended December 31,
|
||||||||||||
2019
|
2018
|
2017
|
||||||||||
Net cash provided by operating activities
|
(In thousands)
|
|||||||||||
Earnings (loss) from continuing operations
|
$
|
(23,272
|
)
|
$
|
286,922
|
|
$
|
720,101
|
|
|||
Non-cash and other, net
|
2,178,662
|
|
1,716,802
|
|
983,981
|
|
||||||
Collections on sales-type leases
|
121,201
|
|
82,803
|
|
81,015
|
|
||||||
Changes in operating assets and liabilities:
|
||||||||||||
Receivables
|
27,149
|
|
(193,144
|
)
|
(178,861
|
)
|
||||||
Accounts payable
|
(26,596
|
)
|
16,869
|
|
66,149
|
|
||||||
Changes in other assets and liabilities
|
(136,605
|
)
|
(192,259
|
)
|
(44,287
|
)
|
||||||
Cash flows from operating activities from continuing operations
|
$
|
2,140,539
|
|
$
|
1,717,993
|
|
$
|
1,628,098
|
|
2019
|
2018
|
2017
|
||||||||||
|
(In thousands)
|
|||||||||||
Net cash provided by operating activities
|
$
|
2,140,539
|
|
$
|
1,717,993
|
|
$
|
1,628,098
|
|
|||
Sales of revenue earning equipment (1)
|
465,705
|
|
379,716
|
|
376,743
|
|
||||||
Sales of operating property and equipment (1)
|
52,276
|
|
16,606
|
|
52,257
|
|
||||||
Total cash generated (2)
|
2,658,520
|
|
2,114,315
|
|
2,057,098
|
|
||||||
Purchases of property and revenue earning equipment (1)
|
(3,735,174
|
)
|
(3,050,409
|
)
|
(1,860,436
|
)
|
||||||
Free cash flow (2)
|
$
|
(1,076,654
|
)
|
$
|
(936,094
|
)
|
$
|
196,662
|
|
|||
(1)
|
Included in cash flows from investing activities.
|
(2)
|
Non-GAAP financial measures. Reconciliations of net cash provided by operating activities to total cash generated and to free cash flow are set forth in this table. Refer to the “Non-GAAP Financial Measures” section of this MD&A for the reasons why management believes these measures are important to investors.
|
2019
|
2018
|
2017
|
||||||||||
|
(In thousands)
|
|||||||||||
Revenue earning equipment:
|
||||||||||||
ChoiceLease
|
$
|
2,871,043
|
|
$
|
2,206,500
|
|
$
|
1,456,758
|
|
|||
Commercial rental
|
556,560
|
|
796,617
|
|
351,707
|
|
||||||
3,427,603
|
|
3,003,117
|
|
1,808,465
|
|
|||||||
Operating property and equipment
|
192,820
|
|
162,154
|
|
132,752
|
|
||||||
Total capital expenditures (1)
|
3,620,423
|
|
3,165,271
|
|
1,941,217
|
|
||||||
Changes in accounts payable related to purchases of revenue earning equipment
|
114,751
|
|
(114,862
|
)
|
(80,781
|
)
|
||||||
Cash paid for purchases of property and revenue earning equipment
|
$
|
(3,735,174
|
)
|
$
|
(3,050,409
|
)
|
$
|
(1,860,436
|
)
|
(1)
|
Non-cash additions exclude approximately $22 million, $15 million and $23 million in 2019, 2018 and 2017, respectively, in assets held under finance leases resulting from new or the extension of existing finance leases and other additions.
|
Rating Summary
|
||||||
Short-term
|
Long-term
|
Outlook
|
||||
Fitch Ratings
|
F2
|
|
A-
|
|
Stable
|
|
Standard & Poor’s Ratings Services
|
A2
|
|
BBB
|
|
Stable
|
|
Moody’s Investors Service
|
P2
|
|
Baa1
|
|
Stable
|
|
DBRS
|
R-1 (Low)
|
A (Low)
|
Stable
|
|
(In millions)
|
Global revolving credit facility
|
$744
|
Trade receivables program
|
$225
|
Total
|
2020
|
2021-2022
|
2023-2024
|
Thereafter
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||
Debt (1)
|
$
|
7,898,484
|
|
$
|
1,322,055
|
|
$
|
2,378,765
|
|
$
|
3,441,759
|
|
$
|
755,905
|
|
|||||
Finance lease obligations
|
61,155
|
|
14,663
|
|
22,390
|
|
11,541
|
|
12,561
|
|
||||||||||
Total debt, including finance leases
|
7,959,639
|
|
1,336,718
|
|
2,401,155
|
|
3,453,300
|
|
768,466
|
|
||||||||||
Interest on debt (2)
|
707,704
|
|
208,165
|
|
320,308
|
|
141,846
|
|
37,385
|
|
||||||||||
Operating leases (3)
|
243,516
|
|
79,345
|
|
100,496
|
|
45,220
|
|
18,455
|
|
||||||||||
Purchase obligations (4)
|
533,621
|
|
486,979
|
|
34,822
|
|
10,865
|
|
955
|
|
||||||||||
Total contractual cash obligations
|
1,484,841
|
|
774,489
|
|
455,626
|
|
197,931
|
|
56,795
|
|
||||||||||
Insurance obligations (primarily self-insurance)
|
438,371
|
|
152,533
|
|
141,501
|
|
61,101
|
|
83,236
|
|
||||||||||
Other long-term liabilities (5), (6), (7)
|
72,106
|
|
3,162
|
|
5,035
|
|
5,842
|
|
58,067
|
|
||||||||||
Total
|
$
|
9,954,957
|
|
$
|
2,266,902
|
|
$
|
3,003,317
|
|
$
|
3,718,174
|
|
$
|
966,564
|
|
(1)
|
Net of unamortized discount and excludes the fair market value adjustment on notes subject to hedging.
|
(2)
|
Total debt matures at various dates through fiscal year 2026 and bears interest principally at fixed rates. Interest on variable-rate debt is calculated based on the applicable rate as of December 31, 2019. Amounts are based on existing debt obligations and do not consider potential refinancing of expiring debt obligations.
|
(3)
|
Represents future lease payments associated with vehicles, equipment and properties under operating leases. Amounts are based upon the general assumption that the leased asset will remain on lease for the length of time specified by the respective lease agreements. No effect has been given to renewals, cancellations, contingent rentals or future rate changes.
|
(4)
|
The majority of our purchase obligations are pay-as-you-go transactions made in the ordinary course of business. Purchase obligations include agreements to purchase goods or services that are legally binding and that specify all significant terms, including: fixed or minimum quantities to be purchased; fixed minimum or variable price provisions; and the approximate timing of the transaction. The most significant item included in the above table are purchase obligations related to vehicles. Purchase orders made in the ordinary course of business that are cancelable are excluded from the above table. Any amounts for which we are liable under purchase orders for goods received are reflected in the Consolidated Balance Sheets as “Accounts payable” and “Accrued expenses and other current liabilities” and are excluded from the above table.
|
(5)
|
Represents other long-term liabilities reflected in our Consolidated Balance Sheets that have known payment streams. The most significant items included were asset retirement obligations and deferred compensation obligations.
|
(6)
|
The amounts exclude our estimated pension contributions. For 2020, our pension contributions, including our minimum funding requirements as set forth by U.S. and international regulations and legislation (including ERISA), are expected to be $37 million. Our minimum funding requirements after 2020 are dependent on several factors. However, we estimate that the undiscounted required global contributions over the next five years are approximately $276 million (pre-tax) (assuming expected long-term rate of return realized and other assumptions remain unchanged). We also have payments due under our other postretirement benefit (OPEB) plans. These plans are not required to be funded in advance, but are pay-as-you-go. See Note 20,“Employee Benefit Plans,” in the Notes to Consolidated Financial Statements for further discussion.
|
(7)
|
The amounts exclude $54 million of liabilities associated with uncertain tax positions as we are unable to reasonably estimate the ultimate amount or timing of settlement. See Note 12, “Income Taxes,” in the Notes to Consolidated Financial Statements for further discussion.
|
2020
|
2019
|
2018
|
|||
Policy depreciation
|
$205 million
|
$134 million
|
$40 million
|
2020
|
2019
|
2018
|
|||
Accelerated depreciation
|
$70 million
|
$223 million
|
$39 million
|
Assumed Rate
|
Change
|
Impact on 2020 Net Pension Expense
|
Effect on December 31, 2019 Projected Benefit Obligation
|
|||||
Expected long-term rate of return on assets
|
5.10%
|
+/- 0.25
|
+/- $3.5 million
|
N/A
|
||||
Discount rate
|
3.30%
|
+/- 0.25
|
N/M
|
+/- $54 million
|
Non-GAAP Financial Measure
|
Comparable GAAP Measure
|
Operating Revenue Measures:
|
|
Operating Revenue
|
Total Revenue
|
FMS Operating Revenue
|
FMS Total Revenue
|
SCS Operating Revenue
|
SCS Total Revenue
|
DTS Operating Revenue
|
DTS Total Revenue
|
FMS EBT as a % of FMS Operating Revenue
|
FMS EBT as a % of FMS Total Revenue
|
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 (Loss) Before Income Tax
|
Earnings (Loss) Before Income Tax
|
Comparable Earnings (Loss)
|
Earnings (Loss) from Continuing Operations
|
Comparable EPS
|
EPS from Continuing Operations
|
Comparable Tax Rate
|
Effective Tax Rate from Continuing Operations
|
Adjusted Return on Equity (ROE)
|
Not Applicable. However, 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.
|
Adjusted Return on Capital (ROC)
|
Not Applicable. However, 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 total debt and average shareholders' equity to adjusted average total capital is provided in the following reconciliations.
|
Cash Flow Measures:
|
|
Total Cash Generated and Free Cash Flow
|
Cash Provided by Operating Activities
|
Operating Revenue Measures:
|
||||
Operating Revenue
FMS Operating Revenue
SCS Operating Revenue
DTS Operating Revenue 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 System, Inc. or each business segment (FMS, SCS and DTS) excluding any (1) fuel and (2) subcontracted transportation. We believe operating revenue provides useful information to investors as we use it 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, which 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 trailing market fuel costs. Subcontracted transportation: We also 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 (Loss) before Income Taxes (EBT)
Comparable Earnings (Loss) Comparable earnings (loss) per diluted common share (EPS)
Comparable Tax Rate
Adjusted Return on Equity (ROE)
Adjusted Return on Capital (ROC)
|
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 and (2) any other significant items that are not representative of our business operations. We believe these comparable earnings measures provide useful information to investors and allow for better year-over-year comparison of operating performance. Non-operating pension costs: Our comparable earnings measures exclude non-operating pension costs, 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 a settlement or curtailment of a plan. We exclude non-operating pension costs 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 as detailed in the reconciliation table below. These other significant items vary from period to period and, in some periods, there may be no such significant items. Calculation of comparable tax rate: 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 statutory tax rates of the jurisdictions to which the non-GAAP adjustments relate. Adjusted ROE: 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 net earnings and average shareholders' equity. We use adjusted ROE as an internal measure of how effectively we use the owned capital invested in our operations. Adjusted ROC: Adjusted ROC is defined as adjusted net earnings divided by average total capital and represents the rate of return generated by the capital deployed in our business. Other items impacting comparability described above are excluded, as applicable, from the calculation of net earnings and average shareholders' equity (a component of average total capital).We use adjusted ROC as an internal measure of how effectively we use the capital invested (borrowed or owned) in our operations. |
|||
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: 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: We refer to the net amount of cash generated from operating activities and investing activities (excluding acquisitions) from continuing operations as “free cash flow”. 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, (3) net cash provided by the sale of operating property and equipment, and (4) other cash inflows from investing activities, less (5) 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. |
Continuing Operations
|
||||||||||||||||||||
Years ended December 31,
|
||||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||||||||
|
(In thousands, except per share amounts)
|
|||||||||||||||||||
EBT
|
$
|
(42,271
|
)
|
$
|
389,469
|
|
$
|
296,436
|
|
$
|
407,256
|
|
$
|
469,215
|
|
|||||
Non-operating pension costs (1)
|
60,406
|
|
7,541
|
|
27,741
|
|
29,943
|
|
17,797
|
|
||||||||||
Restructuring and other, net (2)
|
35,308
|
|
5,597
|
|
17,265
|
|
5,074
|
|
18,068
|
|
||||||||||
ERP implementation costs (2)
|
21,260
|
|
742
|
|
—
|
|
—
|
|
—
|
|
||||||||||
Goodwill impairment (3)
|
—
|
|
15,513
|
|
—
|
|
—
|
|
—
|
|
||||||||||
Tax reform-related and other tax adjustments, net (4), (5)
|
—
|
|
—
|
|
23,278
|
|
—
|
|
—
|
|
||||||||||
Pension-related adjustments (1)
|
—
|
|
—
|
|
5,454
|
|
7,650
|
|
(509
|
)
|
||||||||||
Operating tax adjustment (4)
|
—
|
|
—
|
|
2,205
|
|
—
|
|
—
|
|
||||||||||
Gain on sale of property (6)
|
(18,614
|
)
|
—
|
|
(24,122
|
)
|
—
|
|
—
|
|
||||||||||
Comparable EBT
|
$
|
56,089
|
|
$
|
418,862
|
|
$
|
348,257
|
|
$
|
449,923
|
|
$
|
504,571
|
|
|||||
Earnings (loss)
|
$
|
(23,272
|
)
|
$
|
286,922
|
|
$
|
720,101
|
|
$
|
265,232
|
|
$
|
305,989
|
|
|||||
Non-operating pension costs (1)
|
44,852
|
|
4,685
|
|
16,034
|
|
17,518
|
|
10,136
|
|
||||||||||
Restructuring and other, net (2)
|
26,532
|
|
4,475
|
|
9,231
|
|
3,513
|
|
12,782
|
|
||||||||||
ERP implementation costs (2)
|
15,779
|
|
550
|
|
—
|
|
—
|
|
—
|
|
||||||||||
Goodwill impairment (3)
|
—
|
|
15,513
|
|
—
|
|
—
|
|
—
|
|
||||||||||
Tax reform-related and other tax adjustments, net (4), (5)
|
3,508
|
|
10,038
|
|
(512,234
|
)
|
—
|
|
—
|
|
||||||||||
Uncertain tax position (5)
|
—
|
|
(4,382
|
)
|
—
|
|
—
|
|
—
|
|
||||||||||
Pension-related adjustments (1)
|
—
|
|
—
|
|
3,303
|
|
4,817
|
|
(309
|
)
|
||||||||||
Operating tax adjustment (4)
|
—
|
|
—
|
|
1,677
|
|
—
|
|
—
|
|
||||||||||
Gain on sale of property (6)
|
(13,845
|
)
|
—
|
|
(14,769
|
)
|
—
|
|
—
|
|
||||||||||
Tax law changes (5)
|
—
|
|
(3,020
|
)
|
1,844
|
|
—
|
|
(2,113
|
)
|
||||||||||
Comparable Earnings (7)
|
$
|
53,554
|
|
$
|
314,781
|
|
$
|
225,187
|
|
$
|
291,080
|
|
$
|
326,485
|
|
|||||
Diluted EPS
|
$
|
(0.45
|
)
|
$
|
5.43
|
|
$
|
13.54
|
|
$
|
4.95
|
|
$
|
5.73
|
|
|||||
Non-operating pension costs (1)
|
0.85
|
|
0.09
|
|
0.31
|
|
0.33
|
|
0.19
|
|
||||||||||
Restructuring and other, net (2)
|
0.51
|
|
0.08
|
|
0.15
|
|
0.06
|
|
0.23
|
|
||||||||||
ERP implementation costs (2)
|
0.30
|
|
0.01
|
|
—
|
|
—
|
|
—
|
|
||||||||||
Goodwill impairment (3)
|
—
|
|
0.29
|
|
—
|
|
—
|
|
—
|
|
||||||||||
Tax reform-related and other tax adjustments, net (4), (5)
|
0.06
|
|
0.19
|
|
(9.62
|
)
|
—
|
|
—
|
|
||||||||||
Uncertain tax position (5)
|
—
|
|
(0.08
|
)
|
—
|
|
—
|
|
—
|
|
||||||||||
Pension-related adjustments (1)
|
—
|
|
—
|
|
0.06
|
|
0.09
|
|
(0.01
|
)
|
||||||||||
Operating tax adjustment (4)
|
—
|
|
—
|
|
0.03
|
|
—
|
|
—
|
|
||||||||||
Gain on sale of property (6)
|
(0.26
|
)
|
—
|
|
(0.27
|
)
|
—
|
|
—
|
|
||||||||||
Tax law changes (5)
|
—
|
|
(0.06
|
)
|
0.03
|
|
—
|
|
(0.04
|
)
|
||||||||||
Comparable EPS (7)
|
$
|
1.01
|
|
$
|
5.95
|
|
$
|
4.23
|
|
$
|
5.43
|
|
$
|
6.10
|
|
(1)
|
Refer to Note 20, “Employee Benefit Plans,” in the Notes to Consolidated Financial Statements for additional information.
|
(2)
|
Refer to Note 5, “Restructuring and Other Items, Net,” in the Notes to Consolidated Financial Statements for additional information.
|
(3)
|
Refer to Note 9, "Goodwill,” in the Notes to Consolidated Financial Statements for additional information.
|
(4)
|
Refer to Note 22, “Other Items Impacting Comparability,” in the Notes to Consolidated Financial Statements for additional information.
|
(5)
|
Refer to Note 12, “Income Taxes,” in the Notes to Consolidated Financial Statements for additional information.
|
(6)
|
Refer to Note 25, "Miscellaneous Income, Net," in the Notes to Consolidated Financial Statements for additional information.
|
(7)
|
Refer to the reconciliation of the comparable provision for income taxes table below for information on the tax impact on our comparable earnings measures.
|
Years ended December 31,
|
||||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||||||||
(In thousands)
|
||||||||||||||||||||
Benefit from (provision for)
income taxes (1), (2)
|
$
|
18,999
|
|
$
|
(102,547
|
)
|
$
|
423,665
|
|
$
|
(142,024
|
)
|
$
|
(163,226
|
)
|
|||||
Income tax effects of non-GAAP adjustments (1)
|
(25,042
|
)
|
(11,572
|
)
|
(11,223
|
)
|
(16,819
|
)
|
(14,860
|
)
|
||||||||||
Tax reform-related and other tax adjustments, net (1), (2)
|
3,508
|
|
10,038
|
|
(535,512
|
)
|
—
|
|
—
|
|
||||||||||
Comparable provision for income taxes (1)
|
$
|
(2,535
|
)
|
$
|
(104,081
|
)
|
$
|
(123,070
|
)
|
$
|
(158,843
|
)
|
$
|
(178,086
|
)
|
(1)
|
The comparable provision for income taxes is computed using the same methodology as the GAAP provision of income taxes. Income tax effects of non-GAAP adjustments are calculated based on statutory tax rates of the jurisdictions to which the non-GAAP adjustments related.
|
(2)
|
2017 amounts reflect a tax benefit as a result of the 2017 Tax Cuts and Jobs Act. Refer to Note 12 , "Income Taxes ," in the Notes to Consolidated Financial Statements for additional information.
|
Years ended December 31,
|
|||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015
|
|||||||||||||||
|
(In thousands)
|
||||||||||||||||||
Net cash provided by operating activities
|
$
|
2,140,539
|
|
$
|
1,717,993
|
|
$
|
1,628,098
|
|
$
|
1,601,022
|
|
$
|
1,441,788
|
|
||||
Sales of revenue earning equipment (1)
|
465,705
|
|
379,716
|
|
376,743
|
|
414,249
|
|
423,605
|
|
|||||||||
Sales of operating property and equipment (1)
|
52,276
|
|
16,606
|
|
52,257
|
|
7,051
|
|
3,891
|
|
|||||||||
Collections on direct finance leases (2)
|
—
|
|
—
|
|
—
|
|
76,510
|
|
70,980
|
|
|||||||||
Total cash generated
|
2,658,520
|
|
2,114,315
|
|
2,057,098
|
|
2,098,832
|
|
1,940,264
|
|
|||||||||
Purchases of property and revenue earning equipment
|
(3,735,174
|
)
|
(3,050,409
|
)
|
(1,860,436
|
)
|
(1,905,157
|
)
|
(2,667,978
|
)
|
|||||||||
Free cash flow
|
$
|
(1,076,654
|
)
|
$
|
(936,094
|
)
|
|
$
|
196,662
|
|
$
|
193,675
|
|
$
|
(727,714
|
)
|
|||
Memo:
|
|||||||||||||||||||
Net cash used in investing activities
|
$
|
(3,217,193
|
)
|
$
|
(2,821,459
|
)
|
$
|
(1,438,676
|
)
|
$
|
(1,407,347
|
)
|
$
|
(2,161,355
|
)
|
||||
Net cash provided by (used in) financing activities
|
$
|
1,084,139
|
|
$
|
1,085,515
|
|
$
|
(162,055
|
)
|
$
|
(185,922
|
)
|
$
|
731,485
|
|
(1)
|
Included in cash flows from investing activities.
|
(2)
|
Included in cash flows from investing activities for periods prior to January 1, 2017 as a result of the adoption of the new leasing standard in 2019.
|
Years ended December 31,
|
||||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||
Total revenue
|
$
|
8,925,801
|
|
$
|
8,413,946
|
|
$
|
7,280,074
|
|
$
|
6,758,138
|
|
$
|
6,571,893
|
|
|||||
Subcontracted transportation
|
(854,149
|
)
|
(836,991
|
)
|
(546,369
|
)
|
(338,716
|
)
|
(288,082
|
)
|
||||||||||
Fuel
|
(847,320
|
)
|
(878,839
|
)
|
(711,200
|
)
|
(628,525
|
)
|
(722,734
|
)
|
||||||||||
Operating revenue
|
$
|
7,224,332
|
|
$
|
6,698,116
|
|
6,022,505
|
|
$
|
5,790,897
|
|
$
|
5,561,077
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
FMS total revenue
|
$
|
5,571,403
|
|
$
|
5,258,693
|
|
$
|
4,716,541
|
|
|||
Fuel (1)
|
(816,362
|
)
|
(847,655
|
)
|
(689,809
|
)
|
||||||
FMS operating revenue
|
$
|
4,755,041
|
|
$
|
4,411,038
|
|
$
|
4,026,732
|
|
|||
FMS EBT
|
$
|
(70,274
|
)
|
$
|
340,038
|
|
$
|
295,618
|
|
|||
FMS EBT as a % of FMS total revenue
|
(1.3)%
|
6.5%
|
6.3%
|
|||||||||
FMS EBT as a % of FMS operating revenue
|
(1.5)%
|
7.7%
|
7.3%
|
(1)
|
Includes intercompany fuel sales from FMS to DTS and SCS.
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
SCS total revenue
|
$
|
2,551,271
|
|
$
|
2,398,144
|
|
$
|
1,937,352
|
|
|||
Subcontracted transportation
|
(554,678
|
)
|
(521,028
|
)
|
(354,644
|
)
|
||||||
Fuel
|
(116,628
|
)
|
(111,780
|
)
|
(75,160
|
)
|
||||||
SCS operating revenue
|
$
|
1,879,965
|
|
$
|
1,765,336
|
|
$
|
1,507,548
|
|
|||
SCS EBT
|
$
|
145,060
|
|
$
|
130,262
|
|
$
|
98,825
|
|
|||
SCS EBT as a % of SCS total revenue
|
5.7%
|
5.4%
|
5.1%
|
|||||||||
SCS EBT as a % of SCS operating revenue
|
7.7%
|
7.4%
|
6.6%
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
DTS total revenue
|
$
|
1,417,483
|
|
$
|
1,333,313
|
|
$
|
1,095,645
|
|
|||
Subcontracted transportation
|
(299,471
|
)
|
(315,963
|
)
|
(191,725
|
)
|
||||||
Fuel
|
(145,318
|
)
|
(146,813
|
)
|
(114,626
|
)
|
||||||
DTS operating revenue
|
$
|
972,694
|
|
$
|
870,537
|
|
$
|
789,294
|
|
|||
DTS EBT
|
$
|
81,149
|
|
$
|
61,236
|
|
$
|
55,346
|
|
|||
DTS EBT as a % of DTS total revenue
|
5.7%
|
4.6%
|
5.1%
|
|||||||||
DTS EBT as a % of DTS operating revenue
|
8.3%
|
7.0%
|
7.0%
|
Years ended December 31,
|
||||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||
Net earnings (loss) (1)
|
$
|
(24,410
|
)
|
$
|
284,613
|
|
$
|
719,644
|
|
$
|
263,069
|
|
$
|
304,768
|
|
|||||
Other items impacting comparability, net (2)
|
37,954
|
|
21,852
|
|
24,080
|
|
12,585
|
|
17,559
|
|
||||||||||
Income taxes
|
(18,951
|
)
|
102,695
|
|
(423,145
|
)
|
141,906
|
|
163,649
|
|
||||||||||
Adjusted earnings (loss) before income taxes
|
(5,407
|
)
|
409,160
|
|
320,579
|
|
417,560
|
|
485,976
|
|
||||||||||
Adjusted income taxes (3)
|
12,972
|
|
(101,373
|
)
|
(111,884
|
)
|
(146,567
|
)
|
(171,021
|
)
|
||||||||||
Adjusted net earnings (loss) for adjusted return
on equity [A]
|
$
|
7,565
|
|
$
|
307,787
|
|
$
|
208,695
|
|
$
|
270,993
|
|
$
|
314,955
|
|
|||||
Average shareholders’ equity
|
$
|
2,532,875
|
|
$
|
2,492,956
|
|
$
|
1,983,736
|
|
$
|
2,053,039
|
|
$
|
1,894,917
|
|
|||||
Average adjustments to shareholders’ equity (4)
|
14,988
|
|
(78,431
|
)
|
(98,794
|
)
|
1,728
|
|
10,843
|
|
||||||||||
Adjusted average shareholders’ equity [B]
|
$
|
2,547,863
|
|
$
|
2,414,525
|
|
$
|
1,884,942
|
|
$
|
2,054,767
|
|
$
|
1,905,760
|
|
|||||
Adjusted return on equity [A/B]
|
0.3%
|
12.7%
|
11.1%
|
13.2%
|
16.5%
|
Years ended December 31,
|
||||||||||||||||||||
2019
|
2018
|
2017
|
2016
|
2015
|
||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||
Net earnings (loss) (1)
|
$
|
(24,410
|
)
|
$
|
284,613
|
|
$
|
719,644
|
|
$
|
263,069
|
|
$
|
304,768
|
|
|||||
Other items impacting comparability, net (2)
|
37,954
|
|
21,852
|
|
24,080
|
|
12,585
|
|
17,559
|
|
||||||||||
Income taxes
|
(18,951
|
)
|
102,695
|
|
(423,145
|
)
|
141,906
|
|
163,649
|
|
||||||||||
Adjusted earnings (loss) before income taxes
|
(5,407
|
)
|
409,160
|
|
320,579
|
|
417,560
|
|
485,976
|
|
||||||||||
Adjusted interest expense (5)
|
241,478
|
|
180,648
|
|
142,051
|
|
148,043
|
|
150,640
|
|
||||||||||
Adjusted income taxes (6)
|
(43,164
|
)
|
(146,335
|
)
|
(161,891
|
)
|
(198,531
|
)
|
(224,033
|
)
|
||||||||||
Adjusted net earnings (loss) for adjusted return on capital [A]
|
$
|
192,907
|
|
$
|
443,473
|
|
$
|
300,739
|
|
$
|
367,072
|
|
$
|
412,583
|
|
|||||
Average total debt
|
$
|
7,427,218
|
|
$
|
6,025,260
|
|
$
|
5,394,752
|
|
$
|
5,549,458
|
|
$
|
5,177,012
|
|
|||||
Average off-balance sheet debt
|
—
|
|
—
|
|
—
|
|
1,472
|
|
1,467
|
|
||||||||||
Average shareholders’ equity
|
2,532,875
|
|
2,492,956
|
|
1,983,736
|
|
2,053,039
|
|
1,894,917
|
|
||||||||||
Average adjustments to shareholders’ equity (4)
|
14,988
|
|
(78,431
|
)
|
(98,794
|
)
|
1,728
|
|
10,843
|
|
||||||||||
Adjusted average total capital [B]
|
$
|
9,975,081
|
|
$
|
8,439,785
|
|
$
|
7,279,694
|
|
$
|
7,605,697
|
|
$
|
7,084,239
|
|
|||||
Adjusted return on capital [A]/[B]
|
1.9%
|
5.2%
|
4.2%
|
4.8%
|
5.8%
|
(1)
|
2017 amounts reflect a tax benefit as a result of the 2017 Tax Cuts and Jobs Act. Refer to Note 12 , "Income Taxes ," in the Notes to Consolidated Financial Statements for additional information.
|
(2)
|
Refer to the table above which discusses items excluded from our segment EBT measure and their classification within our Consolidated Statements of Earnings.
|
(3)
|
Represents the tax provision on adjusted net earnings before income taxes.
|
(4)
|
Represents the impact of other items impacting comparability, net of tax, to equity for the respective period.
|
(5)
|
Represents reported interest expense plus imputed interest on off-balance sheet obligations.
|
(6)
|
Represents provision for income taxes plus income taxes on other items impacting comparability and adjusted interest expense.
|
2020
|
||||
(In thousands)
|
||||
Net cash provided by operating activities
|
$
|
2,130,000
|
|
|
Sales of revenue earning equipment (1)
|
430,000
|
|
||
Total cash generated
|
2,560,000
|
|
||
Purchases of property and revenue earning equipment (1)
|
(2,210,000
|
)
|
||
Forecasted free cash flow
|
$
|
350,000
|
|
(1)
|
Included in cash flows from investing activities.
|
•
|
our expectations in our FMS business segment regarding anticipated ChoiceLease revenue and fleet growth and commercial rental revenue and demand;
|
•
|
our expectations in our SCS and DTS business segments regarding anticipated operating revenue trends, sales activity and growth rates;
|
•
|
our expectations of the long-term residual values of revenue earning equipment;
|
•
|
the anticipated increase in NLE vehicles in inventory through the end of the year;
|
•
|
the expected pricing and inventory levels for used vehicles;
|
•
|
our expectations of operating cash flow, free cash flow, and capital expenditures through the end of 2020;
|
•
|
the adequacy of our accounting estimates and reserves for pension expense, compensation expense and employee benefit plan obligations, depreciation and residual value guarantees, goodwill impairment, accounting changes, and income taxes;
|
•
|
our expected future contractual cash obligations and commitments;
|
•
|
the adequacy of our fair value estimates of employee incentive awards under our share-based compensation plans, publicly traded debt and other debt;
|
•
|
our ability to fund all of our operating, investing and financial needs for the foreseeable future through internally generated funds and outside funding sources;
|
•
|
our expected level of use and availability of outside funding sources, anticipated future payments under debt and lease agreements, and risk of losses resulting from counterparty default under hedging and derivative agreements;
|
•
|
the anticipated impact of fuel price and exchange rate fluctuations;
|
•
|
our expectations as to return on pension plan assets, future pension expense and estimated contributions;
|
•
|
our expectations regarding the scope and anticipated outcomes with respect to certain claims, proceedings and lawsuits;
|
•
|
the ultimate disposition of estimated environmental liabilities;
|
•
|
our expectations about the need to repatriate foreign cash to the U.S.;
|
•
|
our ability to access commercial paper and other available debt financing in the capital markets;
|
•
|
our expected cost savings from workforce reductions and restructuring actions;
|
•
|
the size and impact of our strategic investments;
|
•
|
our expectations regarding restructuring charges;
|
•
|
the status of our unrecognized tax benefits related to the U.S. federal, state and foreign tax positions;
|
•
|
our estimates for self-insurance loss reserves;
|
•
|
our expectations regarding the completion and ultimate outcome of certain tax audits; and
|
•
|
the anticipated impact of recent accounting pronouncements.
|
•
|
Market Conditions:
|
◦
|
Changes in general economic and financial conditions in the U.S. and worldwide leading to decreased demand for our services, lower profit margins, increased levels of bad debt and reduced access to credit and financial markets.
|
◦
|
Decreases in freight demand which would impact both our transactional and variable-based contractual business.
|
◦
|
Changes in our customers’ operations, financial condition or business environment that may limit their demand for, or ability to purchase, our services.
|
◦
|
Decreases in market demand affecting the commercial rental market and used vehicle sales as well as global economic conditions.
|
◦
|
Volatility in customer volumes and shifting customer demand in the industries serviced by our SCS business.
|
◦
|
Changes in current financial, tax or regulatory requirements that could negatively impact our financial results.
|
•
|
Competition:
|
◦
|
Advances in technology may impact demand for our services or may require increased investments to remain competitive, and our customers may not be willing to accept higher prices to cover the cost of these investments.
|
◦
|
Competition from other service providers, some of which have greater capital resources or lower capital costs, or from our customers, who may choose to provide services themselves.
|
◦
|
Continued consolidation in the markets in which we operate which may create large competitors with greater financial resources.
|
◦
|
Our inability to maintain current pricing levels due to economic conditions, demand for services, customer acceptance or competition.
|
•
|
Profitability:
|
◦
|
Our inability to obtain adequate profit margins for our services.
|
◦
|
Lower than expected sales volumes or customer retention levels.
|
◦
|
Decreases in commercial rental fleet utilization and pricing.
|
◦
|
Lower than expected used vehicle sales pricing levels and fluctuations in the anticipated proportion of retail versus wholesale sales.
|
◦
|
Loss of key customers in our DTS and SCS business segments.
|
◦
|
Our inability to adapt our product offerings to meet changing consumer preferences on a cost-effective basis.
|
◦
|
The inability of our legacy information technology systems to provide timely access to data.
|
◦
|
Sudden changes in fuel prices and fuel shortages.
|
◦
|
Higher prices for vehicles, diesel engines and fuel as a result of new environmental standards.
|
◦
|
Higher than expected maintenance costs and lower than expected benefits associated with our maintenance initiatives.
|
◦
|
Our inability to successfully execute our asset management initiatives, maintain our fleet at normalized levels and right-size our fleet in line with demand.
|
◦
|
Our key assumptions and pricing structure of our DTS and SCS contracts prove to be inaccurate.
|
◦
|
Increased unionizing, labor strikes and work stoppages.
|
◦
|
Difficulties in attracting and retaining drivers and technicians due to driver and technician shortages, which may result in higher costs to procure drivers and technicians and higher turnover rates affecting our customers.
|
◦
|
Our inability to manage our cost structure.
|
◦
|
Our inability to limit our exposure for customer claims.
|
◦
|
Unfavorable or unanticipated outcomes in legal or regulatory proceedings or uncertain positions.
|
◦
|
Business interruptions or expenditures due to severe weather or natural occurrences.
|
•
|
Financing Concerns:
|
◦
|
Higher borrowing costs.
|
◦
|
Unanticipated interest rate and currency exchange rate fluctuations.
|
◦
|
Negative funding status of our pension plans caused by lower than expected returns on invested assets and unanticipated changes in interest rates.
|
◦
|
Withdrawal liability as a result of our participation in multi-employer plans.
|
◦
|
Instability in U.S. and worldwide credit markets, resulting in higher borrowing costs and/or reduced access to credit.
|
•
|
Accounting Matters:
|
◦
|
Reductions in residual values or useful lives of revenue earning equipment.
|
◦
|
Increases in compensation levels, retirement rate and mortality resulting in higher pension expense; regulatory changes affecting pension estimates, accruals and expenses.
|
◦
|
Changes in accounting rules, assumptions and accruals.
|
◦
|
Difficulties and delays in implementing our Enterprise Resource Planning system and related processes.
|
•
|
Other risks detailed from time to time in our SEC filings, including in “Item 1A.-Risk Factors” of this Annual Report.
|
|
|
Page No.
|
|
||
|
||
|
||
|
||
|
||
|
||
Notes to Consolidated Financial Statements:
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
Consolidated Financial Statement Schedule for the Years Ended December 31, 2019, 2018 and 2017:
|
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands, except per share amounts)
|
|||||||||||
Lease & related maintenance and rental revenues
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Services revenue
|
|
|
|
|
|
|
||||||
Fuel services revenue
|
|
|
|
|
|
|
||||||
Total revenues
|
|
|
|
|
|
|
||||||
Cost of lease & related maintenance and rental
|
|
|
|
|
|
|
||||||
Cost of services
|
|
|
|
|
|
|
||||||
Cost of fuel services
|
|
|
|
|
|
|
||||||
Other operating expenses
|
|
|
|
|
|
|
||||||
Selling, general and administrative expenses
|
|
|
|
|
|
|
||||||
Non-operating pension costs
|
|
|
|
|
|
|
||||||
Used vehicle sales, net
|
|
|
|
|
|
|
||||||
Interest expense
|
|
|
|
|
|
|
||||||
Miscellaneous (income) loss, net
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Restructuring and other items, net
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|||||||
Earnings (loss) from continuing operations before income taxes
|
(
|
)
|
|
|
|
|
||||||
Provision for (benefit from) income taxes
|
(
|
)
|
|
|
(
|
)
|
||||||
Earnings (loss) from continuing operations
|
(
|
)
|
|
|
|
|
||||||
Loss from discontinued operations, net of tax
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net earnings (loss)
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Earnings (loss) per common share — Basic
|
||||||||||||
Continuing operations
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Discontinued operations
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net earnings (loss)
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Earnings (loss) per common share — Diluted
|
||||||||||||
Continuing operations
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Discontinued operations
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net earnings (loss)
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
Years ended December 31,
|
||||||||||||
2019
|
2018
|
2017
|
||||||||||
(In thousands)
|
||||||||||||
Net earnings (loss)
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Other comprehensive income (loss):
|
||||||||||||
Changes in cumulative translation adjustment and other
|
|
|
(
|
)
|
|
|
||||||
Amortization of pension and postretirement items
|
|
|
|
|
|
|
||||||
Income tax expense related to amortization of pension and postretirement items
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Amortization of pension and postretirement items, net of tax
|
|
|
|
|
|
|
||||||
Reclassification of net actuarial loss due to pension settlement
|
|
|
|
|
|
|
||||||
Change in net actuarial loss and prior service cost
|
(
|
)
|
(
|
)
|
|
|
||||||
Income tax benefit (expense) related to pension settlement and change in net actuarial loss and prior service cost
|
(
|
)
|
|
|
(
|
)
|
||||||
Change in net actuarial loss and prior service cost, net of taxes
|
|
|
(
|
)
|
|
|
||||||
Other comprehensive income (loss), net of taxes
|
|
|
(
|
)
|
|
|
||||||
Comprehensive income
|
$
|
|
|
$
|
|
|
$
|
|
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands, except
share amounts)
|
|||||||
Assets:
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
|
|
$
|
|
|
||
Receivables, net
|
|
|
|
|
||||
Inventories
|
|
|
|
|
||||
Prepaid expenses and other current assets
|
|
|
|
|
||||
Total current assets
|
|
|
|
|
||||
Revenue earning equipment, net
|
|
|
|
|
||||
Operating property and equipment, net
|
|
|
|
|
||||
Goodwill
|
|
|
|
|
||||
Intangible assets, net
|
|
|
|
|
||||
Sales-type leases and other assets
|
|
|
|
|
||||
Total assets
|
$
|
|
|
$
|
|
|
||
Liabilities and shareholders’ equity:
|
||||||||
Current liabilities:
|
||||||||
Short-term debt and current portion of long-term debt
|
$
|
|
|
$
|
|
|
||
Accounts payable
|
|
|
|
|
||||
Accrued expenses and other current liabilities
|
|
|
|
|
||||
Total current liabilities
|
|
|
|
|
||||
Long-term debt
|
|
|
|
|
||||
Other non-current liabilities
|
|
|
|
|
||||
Deferred income taxes
|
|
|
|
|
||||
Total liabilities
|
|
|
|
|
||||
Commitments and contingencies (Note 23)
|
|
|
||||||
Shareholders’ equity:
|
||||||||
Preferred stock, no par value per share — authorized, 3,800,917; none outstanding, December 31, 2019 and 2018
|
|
|
|
|
||||
Common stock, $0.50 par value per share — authorized, 400,000,000; outstanding, December 31, 2019 — 53,278,316 and December 31, 2018 — 53,116,485
|
|
|
|
|
||||
Additional paid-in capital
|
|
|
|
|
||||
Retained earnings
|
|
|
|
|
||||
Accumulated other comprehensive loss
|
(
|
)
|
(
|
)
|
||||
Total shareholders’ equity
|
|
|
|
|
||||
Total liabilities and shareholders’ equity
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Cash flows from operating activities from continuing operations:
|
||||||||||||
Net earnings (loss)
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Less: Loss from discontinued operations, net of tax
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Earnings (loss) from continuing operations
|
(
|
)
|
|
|
|
|
||||||
Depreciation expense
|
|
|
|
|
|
|
||||||
Goodwill impairment charge
|
|
|
|
|
|
|
||||||
Used vehicle sales, net
|
|
|
|
|
|
|
||||||
Amortization expense and other non-cash charges, net
|
|
|
|
|
|
|
||||||
Non-cash lease expense
|
|
|
|
|
|
|
||||||
Non-operating pension costs and share-based compensation expense
|
|
|
|
|
|
|
||||||
Deferred income tax expense (benefit)
|
(
|
)
|
|
|
(
|
)
|
||||||
Collections on sales-type leases
|
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities, net of acquisitions:
|
||||||||||||
Receivables
|
|
|
(
|
)
|
(
|
)
|
||||||
Inventories
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Prepaid expenses and other assets
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Accounts payable
|
(
|
)
|
|
|
|
|
||||||
Accrued expenses and other non-current liabilities
|
(
|
)
|
(
|
)
|
|
|
||||||
Net cash provided by operating activities from continuing operations
|
|
|
|
|
|
|
||||||
Cash flows from investing activities from continuing operations:
|
||||||||||||
Purchases of property and revenue earning equipment
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Sales of revenue earning equipment
|
|
|
|
|
|
|
||||||
Sales of operating property and equipment
|
|
|
|
|
|
|
||||||
Acquisitions, net of cash acquired
|
|
|
(
|
)
|
(
|
)
|
||||||
Net cash used in investing activities from continuing operations
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Cash flows from financing activities from continuing operations:
|
||||||||||||
Net borrowings (repayments) of commercial paper and revolving credit facilities
|
(
|
)
|
|
|
|
|
||||||
Debt proceeds
|
|
|
|
|
|
|
||||||
Debt repaid
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Dividends on common stock
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Common stock issued
|
|
|
|
|
|
|
||||||
Common stock repurchased
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Debt issuance costs and other items
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net cash provided by (used in) financing activities from continuing operations
|
|
|
|
|
(
|
)
|
||||||
Effect of exchange rates on cash, cash equivalents, and restricted cash
|
(
|
)
|
|
|
(
|
)
|
||||||
Increase (decrease) increase in cash, cash equivalents, and restricted cash from continuing operations
|
|
|
(
|
)
|
|
|
||||||
Increase (decrease) in cash, cash equivalents, and restricted cash from discontinued operations
|
|
|
(
|
)
|
(
|
)
|
||||||
Increase (decrease) in cash, cash equivalents, and restricted cash
|
|
|
(
|
)
|
|
|
||||||
Cash, cash equivalents, and restricted cash at January 1
|
|
|
|
|
|
|
||||||
Cash, cash equivalents, and restricted cash at December 31
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
|
Preferred
Stock
|
Common Stock
|
Additional
Paid-In Capital
|
Retained Earnings
|
Accumulated
Other
Comprehensive Loss
|
|
|||||||||||||||||||||
|
Amount
|
Shares
|
Par
|
Total
|
|||||||||||||||||||||||
|
(In thousands, except share amounts)
|
||||||||||||||||||||||||||
Balance at January 1, 2017
|
$
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
|||||||
Adoption of new lease accounting standard (see Note 2)
|
—
|
|
—
|
|
—
|
|
—
|
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|||||||||||||
Common stock dividends declared —$1.80 per share
|
—
|
|
—
|
|
—
|
|
—
|
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Common stock issued under employee stock option and stock purchase plans (1)
|
—
|
|
|
|
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Benefit plan stock (purchases) sales (2)
|
—
|
|
|
|
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Common stock repurchases
|
—
|
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Share-based compensation
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Balance at December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||||||
Comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
(
|
)
|
|
|
|||||||||||||
Common stock dividends declared —$2.12 per share
|
—
|
|
—
|
|
—
|
|
—
|
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Common stock issued under employee stock option and stock purchase plans (1)
|
—
|
|
|
|
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Benefit plan stock (purchases) sales (2)
|
—
|
|
|
|
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Common stock repurchases
|
—
|
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Share-based compensation
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Adoption of new accounting standard
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
(
|
)
|
—
|
|
|||||||||||||
Balance at December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||||||
Comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
(
|
)
|
|
|
|
|
|||||||||||||
Common stock dividends declared —$2.20 per share
|
—
|
|
—
|
|
—
|
|
—
|
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Common stock issued under employee stock option and stock purchase plans (1)
|
—
|
|
|
|
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Benefit plan stock (purchases) sales (2)
|
—
|
|
|
|
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Common stock repurchases
|
—
|
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
—
|
|
(
|
)
|
|||||||||||||
Share-based compensation
|
—
|
|
—
|
|
—
|
|
|
|
—
|
|
—
|
|
|
|
|||||||||||||
Balance at December 31, 2019
|
$
|
|
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
(1)
|
Net of common shares delivered as payment for the exercise price or to satisfy the holders’ withholding tax liability upon exercise of options.
|
(2)
|
Represents open-market transactions of common shares by the trustee of Ryder’s deferred compensation plans.
|
Level 1
|
Quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access at the measurement date. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
Level 2
|
Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or model-derived valuations or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
|
Level 3
|
Unobservable inputs for the asset or liability. These inputs reflect our own assumptions about the assumptions a market participant would use in pricing the asset or liability.
|
Year ended December 31, 2018
|
Year ended December 31, 2017
|
||||||||||||||||||||||||
As Previously Reported
|
Lessor Adjustments (1)
|
Lessee and Other Adjustments (1) |
As Revised
|
As Previously Reported
|
Lessor Adjustments (1)
|
Lessee and Other Adjustments (1) |
As Revised
|
||||||||||||||||||
Lease & related maintenance and rental revenues (1)
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|
Total revenues
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|||||||||
Cost of lease & related maintenance and rental (1)
|
|
|
(
|
)
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|||||||||
Cost of services (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Other operating expenses
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||
Selling, general and administrative expenses (2)
|
|
|
(
|
)
|
(
|
)
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||
Used vehicle sales, net
|
|
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
|||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Restructuring and other items, net (2)
|
|
|
|
|
(
|
)
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||
Earnings (loss) from continuing operations before income taxes
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
(
|
)
|
|
|
|||||||||
Provision for (benefit from) income taxes
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|||||||||
Earnings (loss) from continuing operations
|
|
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
(
|
)
|
|
|
|||||||||
Net earnings (loss)
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
|
|
Comprehensive income
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
|
|
$
|
|
|
||
Earnings (loss) per common share - Basic
|
|||||||||||||||||||||||||
Continuing operations
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|
Net earnings (loss)
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|
Earnings (loss) per common share - Diluted
|
|||||||||||||||||||||||||
Continuing operations
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|
Net earnings (loss)
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
(1)
|
We determined that certain lessor arrangements of revenue earning equipment historically accounted for as operating leases should have been accounted for as direct financing leases. Additionally, we evaluated our leases for classification and determined that certain lessee arrangements, primarily real estate leases, historically accounted for as operating leases should have been accounted for as capital leases. The prior period error was corrected by reducing "Lease & related maintenance and rental revenues" by approximately $
|
(2)
|
Adjustments primarily reflect the reclassification of our Singapore operations that were shut down during 2019 into "Restructuring and other items, net,".
|
December 31, 2018
|
||||||||||||||||
As Previously
|
Lessor
|
Lessee
|
||||||||||||||
Reported
|
Adjustment (1)
|
Adjustment (1)
|
As Revised
|
|||||||||||||
Receivables, net
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||
Prepaid expenses and other current assets
|
|
|
(
|
)
|
|
|
|
|
||||||||
Total current assets
|
|
|
(
|
)
|
|
|
|
|
||||||||
Revenue earning equipment, net
|
|
|
(
|
)
|
|
|
|
|
||||||||
Operating property and equipment, net
|
|
|
|
|
|
|
|
|
||||||||
Sales-type leases and other assets
|
|
|
|
|
|
|
|
|
||||||||
Total assets
|
|
|
|
|
|
|
|
|
||||||||
Short-term debt and current portion of long term-debt
|
|
|
|
|
|
|
|
|
|
|||||||
Accrued expenses and other current liabilities
|
|
|
|
|
|
|
|
|
||||||||
Total current liabilities
|
|
|
|
|
|
|
|
|
||||||||
Long-term debt
|
|
|
|
|
|
|
|
|
||||||||
Other non-current liabilities
|
|
|
|
|
|
|
|
|
||||||||
Deferred income taxes
|
|
|
(
|
)
|
(
|
)
|
|
|
||||||||
Total liabilities
|
|
|
|
|
|
|
|
|
||||||||
Retained earnings
|
|
|
(
|
)
|
(
|
)
|
|
|
||||||||
Accumulated other comprehensive loss
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Total shareholders' equity
|
|
|
(
|
)
|
(
|
)
|
|
|
||||||||
Total liabilities and shareholders' equity
|
|
|
|
|
|
|
|
|
(1)
|
We determined that in a prior period certain lessor arrangements of revenue earning equipment historically accounted for as operating leases should
|
|
Year ended December 31, 2018
|
Year ended December 31, 2017
|
|||||||||||||||||
|
As Previously Reported
|
New Lease Standard Adjustments
|
As Revised
|
As Previously Reported
|
New Lease Standard Adjustments
|
As Revised
|
|||||||||||||
Net earnings (loss)
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
|
Earnings (loss) from continuing operations
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||
Depreciation expense
|
|
|
(
|
)
|
|
|
|
|
|
|
|
|
|||||||
Used vehicle sales, net
|
|
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||
Amortization expense and other non-cash charges, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Non-cash lease expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Deferred income tax expense
|
|
|
|
|
|
|
(
|
)
|
|
|
(
|
)
|
|||||||
Collections on sales-type leases and other items
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Changes in operating assets and liabilities:
|
|||||||||||||||||||
Receivables
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||
Prepaid expenses and other assets
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||
Accrued expenses and other non-current liabilities
|
|
|
(
|
)
|
(
|
)
|
|
|
(
|
)
|
|
|
|||||||
Net cash provided by operating activities from continuing operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Collections on direct finance leases and other items
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|||||||
Net cash used in investing activities from continuing operations
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||
Debt repaid
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||
Net cash provided by (used in) financing activities from continuing operations
|
|
|
(
|
)
|
|
|
(
|
)
|
(
|
)
|
(
|
)
|
Year ended December 31, 2019
|
|||||||||||||||||||
FMS
|
SCS
|
DTS
|
Eliminations
|
Total
|
|||||||||||||||
(In thousands)
|
|||||||||||||||||||
United States
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
||||
Canada
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||
Europe
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Mexico
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Singapore
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total revenue
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
Year ended December 31, 2018
|
|||||||||||||||||||
FMS
|
SCS
|
DTS
|
Eliminations
|
Total
|
|||||||||||||||
(In thousands)
|
|||||||||||||||||||
United States
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
||||
Canada
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||
Europe
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Mexico
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Singapore
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total revenue
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
Year ended December 31, 2017
|
|||||||||||||||||||
FMS
|
SCS
|
DTS
|
Eliminations
|
Total
|
|||||||||||||||
(In thousands)
|
|||||||||||||||||||
United States
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
||||
Canada
|
|
|
|
|
|
|
(
|
)
|
|
|
|||||||||
Europe
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Mexico
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Singapore
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total revenue
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
Years ended December 31,
|
||||||||||||
2019
|
2018
|
2017
|
||||||||||
(In thousands)
|
||||||||||||
Automotive
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Technology and healthcare
|
|
|
|
|
|
|
||||||
CPG and retail
|
|
|
|
|
|
|
||||||
Industrial and other
|
|
|
|
|
|
|
||||||
Total revenue
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Fleet Management Solutions
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Supply Chain Solutions
|
(
|
)
|
|
|
(
|
)
|
||||||
Dedicated Transportation Solutions
|
|
|
|
|
|
|
||||||
Central Support Services
|
|
|
|
|
|
|
||||||
Restructuring and other items, net
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Employee Termination Costs
|
|||
(In thousands)
|
||||
Balance at December 31, 2016
|
$
|
|
|
|
Workforce reduction charges
|
|
|
||
Utilization (1)
|
(
|
)
|
||
Balance at December 31, 2017
|
|
|
||
Workforce reduction charges
|
|
|
||
Utilization (1)
|
(
|
)
|
||
Balance at December 31, 2018
|
|
|
||
Workforce reduction charges
|
|
|
||
Utilization (1)
|
(
|
)
|
||
Balance at December 31, 2019 (2)
|
$
|
|
|
(1)
|
Principally represents cash payments.
|
(2)
|
The majority of the balance remaining for employee termination costs is expected to be paid by the end of 2020.
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Trade
|
$
|
|
|
$
|
|
|
||
Sales-type leases
|
|
|
|
|
||||
Other, primarily warranty and insurance
|
|
|
|
|
||||
|
|
|
|
|||||
Allowance
|
(
|
)
|
(
|
)
|
||||
Total
|
$
|
|
|
$
|
|
|
|
Estimated Useful Lives |
December 31, 2019
|
December 31, 2018
|
|||||||||||||||||||||||
Cost
|
Accumulated
Depreciation
|
Net (1)
|
Cost
|
Accumulated
Depreciation
|
Net (1)
|
|||||||||||||||||||||
(In years)
|
(In thousands)
|
|||||||||||||||||||||||||
Held for use:
|
||||||||||||||||||||||||||
ChoiceLease
|
3 — 12
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
|||||||
Commercial rental
|
4.5 — 12
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
|||||||||||||
Held for sale
|
|
|
(
|
)
|
|
|
|
|
(
|
)
|
|
|
||||||||||||||
Total
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
$
|
(
|
)
|
$
|
|
|
(1)
|
Revenue earning equipment, net includes vehicles under finance leases of $
|
|
Total Losses (2)
|
|||||||||||||||||||
December 31,
|
Years ended December 31,
|
|||||||||||||||||||
|
2019
|
2018
|
2019
|
2018
|
2017
|
|||||||||||||||
Assets held for sale:
|
(In thousands)
|
(In thousands)
|
||||||||||||||||||
Revenue earning equipment: (1)
|
||||||||||||||||||||
Trucks
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|||||
Tractors
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Trailers
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets at fair value
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
(1)
|
Assets held for sale in the above table only include the portion of revenue earning equipment held for sale where net book values exceeded fair values and fair value adjustments were recorded. Assets held for sale where fair value was higher than net book value were $
|
(2)
|
Total losses represent fair value adjustments for all vehicles held for sale throughout the period for which fair value was less than net book value.
|
|
Years ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
|
(In thousands)
|
|||||||||||
Losses (gains) on vehicle sales, net
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
|||
Losses from fair value adjustments
|
|
|
|
|
|
|
||||||
Used vehicle sales, net
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Estimated
Useful Lives
|
December 31,
|
||||||||
|
2019
|
2018
|
||||||||
|
(In years)
|
(In thousands)
|
||||||||
Land
|
—
|
$
|
|
|
$
|
|
|
|||
Buildings and improvements
|
10 — 40
|
|
|
|
|
|||||
Machinery and equipment
|
3 — 10
|
|
|
|
|
|||||
Other
|
3 — 10
|
|
|
|
|
|||||
|
|
|
|
|||||||
Accumulated depreciation
|
(
|
)
|
(
|
)
|
||||||
Total
|
$
|
|
|
$
|
|
|
Fleet
Management
Solutions
|
Supply Chain Solutions
|
Dedicated Transportation Solutions
|
Total
|
|||||||||||||
|
(In thousands)
|
|||||||||||||||
Balance at January 1, 2018
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||
Acquisitions (1)
|
|
|
|
|
|
|
|
|
||||||||
Impairment
|
(
|
)
|
|
|
|
|
(
|
)
|
||||||||
Foreign currency translation adjustment
|
(
|
)
|
(
|
)
|
|
|
(
|
)
|
||||||||
Balance at December 31, 2018
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustment
|
|
|
(
|
)
|
|
|
(
|
)
|
||||||||
Balance at December 31, 2019 (2)
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
(1)
|
See Note 3, "Acquisitions," for additional information.
|
(2)
|
Accumulated impairment losses were $
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Indefinite lived intangible assets — Trade name
|
$
|
|
|
$
|
|
|
||
Finite lived intangible assets:
|
||||||||
Customer relationship intangibles
|
|
|
|
|
||||
Other intangibles, primarily trade name
|
|
|
|
|
||||
Accumulated amortization
|
(
|
)
|
(
|
)
|
||||
Total
|
$
|
|
|
$
|
|
|
|
December 31, 2019
|
December 31, 2018
|
||||||||||||||||||||||
|
Accrued
Expenses
|
Non-Current
Liabilities
|
Total
|
Accrued
Expenses
|
Non-Current
Liabilities
|
Total
|
||||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||
Salaries and wages
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||||
Deferred compensation
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pension benefits
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other postretirement benefits
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other employee benefits
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Insurance obligations (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deposits, mainly from customers
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating lease liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred revenue (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring liabilities (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Earnings (loss) from continuing operations before income taxes:
|
||||||||||||
United States
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Foreign
|
|
|
|
|
|
|
||||||
Total
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Provision for (benefit from) income taxes from continuing operations:
|
||||||||||||
Current tax expense (benefit) from continuing operations:
|
||||||||||||
Federal (1)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
|
|||
State
|
|
|
|
|
|
|
||||||
Foreign
|
|
|
|
|
|
|
||||||
|
|
(
|
)
|
|
|
|||||||
Deferred tax expense (benefit) from continuing operations:
|
||||||||||||
Federal
|
(
|
)
|
|
|
(
|
)
|
||||||
State
|
(
|
)
|
|
|
|
|
||||||
Foreign
|
(
|
)
|
(
|
)
|
|
|
||||||
(
|
)
|
|
|
(
|
)
|
|||||||
Total
|
$
|
(
|
)
|
$
|
|
|
$
|
(
|
)
|
|
Years ended December 31,
|
||||||||
|
2019
|
2018
|
2017
|
||||||
|
(Percentage of pre-tax earnings)
|
||||||||
Federal statutory tax rate
|
|
%
|
|
%
|
|
%
|
|||
Impact of one-time deemed repatriation
|
|
%
|
|
%
|
|
%
|
|||
Impact on deferred taxes for changes in tax rates
|
|
%
|
(
|
)%
|
(
|
)%
|
|||
Additional deferred tax adjustments
|
|
%
|
(
|
)%
|
|
%
|
|||
State income taxes, net of federal income tax benefit
|
(
|
)%
|
|
%
|
|
%
|
|||
Foreign rates varying from federal statutory tax rate
|
|
%
|
|
%
|
(
|
)%
|
|||
Tax contingencies
|
|
%
|
(
|
)%
|
|
%
|
|||
Tax credits
|
|
%
|
|
%
|
(
|
)%
|
|||
Other permanent book-tax differences
|
(
|
)%
|
|
%
|
|
%
|
|||
Other, net
|
|
%
|
|
%
|
|
%
|
|||
Effective tax rate
|
|
%
|
|
%
|
(
|
)%
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Deferred income tax assets:
|
||||||||
Self-insurance accruals
|
$
|
|
|
$
|
|
|
||
Net operating loss carryforwards
|
|
|
|
|
||||
Accrued compensation and benefits
|
|
|
|
|
||||
Federal benefit on state tax positions
|
|
|
|
|
||||
Pension benefits
|
|
|
|
|
||||
Deferred revenue
|
|
|
|
|
||||
Other accruals
|
|
|
|
|
||||
|
|
|
|
|||||
Valuation allowance
|
(
|
)
|
(
|
)
|
||||
|
|
|
|
|||||
Deferred income tax liabilities:
|
||||||||
Property and equipment basis differences
|
(
|
)
|
(
|
)
|
||||
Other
|
(
|
)
|
(
|
)
|
||||
(
|
)
|
(
|
)
|
|||||
Net deferred income tax liability (1)
|
$
|
(
|
)
|
$
|
(
|
)
|
(1)
|
Deferred tax assets of $
|
Jurisdiction
|
Open Tax Year
|
|
|
||
United States (Federal)
|
2009 - 2011, 2013 - 2019
|
|
Canada
|
2012 - 2019
|
|
Mexico
|
2014 - 2019
|
|
United Kingdom
|
2018 - 2019
|
|
Brazil (in discontinued operations)
|
2014 - 2019
|
|
December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Balance at January 1
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Additions based on tax positions related to the current year
|
|
|
|
|
|
|
||||||
Reductions due to lapse of applicable statutes of limitation
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Gross balance at December 31
|
|
|
|
|
|
|
||||||
Interest and penalties
|
|
|
|
|
|
|
||||||
Balance at December 31
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Operating leases
|
||||||||||||
Lease income related to ChoiceLease
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Lease income related to commercial rental (1)
|
|
|
|
|
|
|
||||||
|
||||||||||||
Sales-type leases
|
||||||||||||
Interest income related to net investment in leases
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
|
||||||||||||
Variable lease income excluding commercial rental (1)
|
$
|
|
|
$
|
|
|
$
|
|
|
(1)
|
Lease income related to commercial rental includes both fixed and variable lease income. Variable lease income is approximately
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Net investment in the lease - lease payment receivable
|
$
|
|
|
$
|
|
|
||
Net investment in the lease - unguaranteed residual value in assets
|
|
|
|
|
||||
$
|
|
|
$
|
|
|
Years ending December 31
|
(In thousands)
|
||
2020
|
$
|
|
|
2021
|
|
|
|
2022
|
|
|
|
2023
|
|
|
|
2024
|
|
|
|
Thereafter
|
|
|
|
Total undiscounted cash flows
|
|
|
|
Present value of lease payments (recognized as lease receivables)
|
(
|
)
|
|
Difference between undiscounted cash flows and discounted cash flows
|
$
|
|
|
Years ending December 31
|
(In thousands)
|
|||
2020
|
$
|
|
|
|
2021
|
|
|
||
2022
|
|
|
||
2023
|
|
|
||
2024
|
|
|
||
Thereafter
|
|
|
||
Total undiscounted cash flows
|
$
|
|
|
|
Years ended December 31,
|
||||||||||||
|
Classification
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
||||||||||||
Finance lease cost
|
|||||||||||||
Amortization of right-of-use-assets
|
Other operating expenses, SG&A
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Interest on lease liabilities
|
Interest expense
|
|
|
|
|
|
|
||||||
Operating lease cost
|
Other operating expenses, SG&A
|
|
|
|
|
|
|
||||||
Short-term lease and other
|
Other operating expenses, SG&A
|
|
|
|
|
|
|
||||||
Variable lease cost
|
Other operating expenses, SG&A
|
|
|
|
|
|
|
||||||
Sublease income
|
Lease & related maintenance and rental revenues, Other operating expenses
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Total lease cost
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Cash paid for amounts included in measurement of liabilities:
|
||||||||||||
Operating cash flows from finance leases
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Operating cash flows from operating leases
|
|
|
|
|
|
|
||||||
Financing cash flows from finance leases
|
|
|
|
|
|
|
||||||
Right-of-use assets obtained in exchange for lease obligations:
|
||||||||||||
Finance leases
|
|
|
|
|
|
|
||||||
Operating leases
|
|
|
|
|
|
|
|
December 31,
|
||||||||
|
Classification
|
2019
|
2018
|
||||||
|
(In thousands)
|
||||||||
Assets
|
|||||||||
Operating lease right-of-use assets
|
Sales-type leases and other assets
|
$
|
|
|
$
|
|
|
||
Finance lease assets
|
Operating property and equipment, net and revenue earning equipment, net
|
|
|
|
|
||||
Total leased assets
|
$
|
|
|
$
|
|
|
|||
Liabilities
|
|||||||||
Current
|
|||||||||
Operating
|
Accrued expenses and other current liabilities
|
$
|
|
|
$
|
|
|
||
Finance
|
Short-term debt and current portion of long-term debt
|
|
|
|
|
||||
Noncurrent
|
|||||||||
Operating
|
Other non-current liabilities
|
|
|
|
|
||||
Finance
|
Long-term debt
|
|
|
|
|
||||
Total lease liabilities
|
$
|
|
|
$
|
|
|
|
December 31,
|
|||||
|
2019
|
2018
|
||||
Weighted-average remaining lease term
|
||||||
Operating
|
|
|
|
|
||
Finance
|
|
|
|
|
||
Weighted-average discount rate
|
||||||
Operating
|
|
%
|
|
%
|
||
Finance
|
|
%
|
|
%
|
|
Operating
|
Finance
|
|
|||||||||
|
Leases
|
Leases
|
Total
|
|||||||||
Years ending December 31
|
(In thousands)
|
|||||||||||
2020
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
2021
|
|
|
|
|
|
|
||||||
2022
|
|
|
|
|
|
|
||||||
2023
|
|
|
|
|
|
|
||||||
2024
|
|
|
|
|
|
|
||||||
Thereafter
|
|
|
|
|
|
|
||||||
Total lease payments
|
|
|
|
|
|
|
||||||
Less: Imputed Interest
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Present value of lease liabilities
|
$
|
|
|
$
|
|
|
$
|
|
|
Weighted-Average Interest Rate
|
||||||||||||||
|
December 31,
|
|
December 31,
|
|||||||||||
|
2019
|
2018
|
Maturities
|
2019
|
2018
|
|||||||||
|
|
|
|
(In thousands)
|
||||||||||
Short-term debt and current portion of long-term debt:
|
||||||||||||||
Short-term debt
|
|
|
$
|
|
|
$
|
|
|
||||||
Current portion of long-term debt, including finance leases
|
|
|
|
|
||||||||||
Total short-term debt and current portion of long-term debt
|
|
|
|
|
||||||||||
Total long-term debt:
|
||||||||||||||
U.S. commercial paper (1)
|
|
|
2023
|
|
|
|
|
|||||||
Canadian commercial paper (1)
|
|
|
2023
|
|
|
|
|
|||||||
Trade receivables program
|
|
|
2020
|
|
|
|
|
|||||||
Global revolving credit facility
|
|
|
2023
|
|
|
|
|
|||||||
Unsecured U.S. notes – Medium-term notes (1) (2)
|
|
|
2020-2026
|
|
|
|
|
|||||||
Unsecured U.S. obligations
|
|
|
2024
|
|
|
|
|
|||||||
Unsecured foreign obligations
|
|
|
2020-2024
|
|
|
|
|
|||||||
Asset-backed U.S. obligations (3)
|
|
|
2020-2026
|
|
|
|
|
|||||||
Finance lease obligations (4)
|
|
|
2020-2073
|
|
|
|
|
|||||||
Total long-term debt
|
|
|
|
|
||||||||||
Debt issuance costs
|
(
|
)
|
(
|
)
|
||||||||||
|
|
|
|
|||||||||||
Current portion of long-term debt, including finance leases
|
(
|
)
|
(
|
)
|
||||||||||
Long-term debt
|
|
|
|
|
||||||||||
Total debt
|
$
|
|
|
$
|
|
|
(1)
|
Amounts are net of unamortized original issue discounts of $
|
(2)
|
Amounts are inclusive of the fair market values of our hedging instruments on our notes of $
|
(3)
|
Asset-backed U.S. obligations are related to financing transactions backed by a portion of our revenue earning equipment.
|
(4)
|
Refer to Note 13, "Leases," for additional information.
|
Years ending December 31
|
(In thousands)
|
|||
2020
|
$
|
|
|
|
2021
|
|
|
||
2022
|
|
|
||
2023
|
|
|
||
2024
|
|
|
||
Thereafter
|
|
|
||
Total (1)
|
|
|
||
Finance lease obligations (Refer to Note 13)
|
|
|
||
Debt issuance costs
|
(
|
)
|
||
Impact of fair market value adjustments on notes subject to hedging
|
|
|
||
Total long-term debt
|
$
|
|
|
(1)
|
Net of unamortized discount.
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Letters of credit
|
$
|
|
|
$
|
|
|
||
Surety bonds
|
|
|
|
|
Currency
Translation
Adjustments and Other
|
Net Actuarial
Loss (1)
|
Prior Service
(Cost)/Credit (1)
|
Accumulated
Other
Comprehensive
Loss
|
|||||||||||||
|
(In thousands)
|
|||||||||||||||
January 1, 2017
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
||||
Amortization
|
|
|
|
|
|
|
|
|
||||||||
Other current period change
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2017
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Amortization
|
|
|
|
|
|
|
|
|
||||||||
Other current period change
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Adoption of new accounting standard
|
|
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
December 31, 2018
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Amortization
|
|
|
|
|
|
|
|
|
||||||||
Pension lump sum settlement
|
|
|
|
|
|
|
|
|
||||||||
Other current period change
|
|
|
(
|
)
|
(
|
)
|
|
|
||||||||
December 31, 2019
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
(1)
|
These amounts are included in the computation of net periodic pension cost and pension settlement charge. See Note 20, "Employee Benefit Plans," for further information.
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands, except per share amounts)
|
|||||||||||
Earnings (loss) per share — Basic:
|
||||||||||||
Earnings (loss) from continuing operations
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Less: Distributed and undistributed earnings allocated to unvested stock
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Earnings (loss) from continuing operations available to common shareholders — Basic
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Weighted average common shares outstanding — Basic
|
|
|
|
|
|
|
||||||
Earnings (loss) from continuing operations per common share — Basic
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Earnings (loss) per share — Diluted:
|
||||||||||||
Earnings (loss) from continuing operations
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Less: Distributed and undistributed earnings allocated to unvested stock
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Earnings (loss) from continuing operations available to common shareholders — Diluted
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Weighted average common shares outstanding — Basic
|
|
|
|
|
|
|
||||||
Effect of dilutive equity awards
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding — Diluted
|
|
|
|
|
|
|
||||||
Earnings (loss) from continuing operations per common share — Diluted
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Anti-dilutive equity awards and market-based restrictive stock rights not included above
|
|
|
|
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Stock option and stock purchase plans
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Unvested stock awards
|
|
|
|
|
|
|
||||||
Share-based compensation expense
|
|
|
|
|
|
|
||||||
Income tax benefit
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Share-based compensation expense, net of tax
|
$
|
|
|
$
|
|
|
$
|
|
|
Shares
|
Weighted- Average
Exercise Price
|
Weighted-Average
Remaining
Contractual Term
|
Aggregate
Intrinsic Value
|
||||||||||
|
(In thousands)
|
|
(In years)
|
(In thousands)
|
|||||||||
Options outstanding at January 1
|
|
|
$
|
|
|
||||||||
Granted
|
|
|
|
|
|||||||||
Exercised
|
(
|
)
|
|
|
|||||||||
Forfeited or expired
|
(
|
)
|
|
|
|||||||||
Options outstanding at December 31
|
|
|
$
|
|
|
|
$
|
|
|
||||
Vested and expected to vest at December 31
|
|
|
$
|
|
|
|
$
|
|
|
||||
Exercisable at December 31
|
|
|
$
|
|
|
|
$
|
|
|
|
Time-Vested
|
Market-Based
|
Performance-Based
|
|||||||||||||||
|
Shares
|
Weighted-
Average
Grant Date
Fair Value
|
Shares
|
Weighted-
Average
Grant Date
Fair Value
|
Shares
|
Weighted-
Average
Grant Date
Fair Value
|
||||||||||||
|
(In thousands)
|
|
(In thousands)
|
|
(In thousands)
|
|
||||||||||||
Unvested stock outstanding at January 1
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
||||||
Granted
|
|
|
|
|
|
|
|
|
|
|||||||||
Vested (1)
|
(
|
|
|
(
|
|
|
(
|
|
|
|||||||||
Forfeited (2)
|
(
|
|
|
(
|
|
|
(
|
|
|
|||||||||
Unvested stock outstanding at December 31
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
Shares granted and exercised
|
|
|
|
|
|
|
||||||
Weighted average exercise price
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
||||||||||||
Expected dividends
|
|
|
|
|||||||||
Expected volatility
|
|
|
|
|||||||||
Risk-free rate
|
|
|
|
|||||||||
Expected term in years
|
|
|
|
|||||||||
Grant-date fair value
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Company-administered plans:
|
||||||||||||
Service cost
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Interest cost
|
|
|
|
|
|
|
||||||
Expected return on plan assets
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Pension settlement expense
|
|
|
|
|
|
|
||||||
Amortization of:
|
||||||||||||
Net actuarial loss
|
|
|
|
|
|
|
||||||
Prior service cost
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|||||||
Union-administered plans
|
|
|
|
|
|
|
||||||
Net pension expense
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Company-administered plans:
|
||||||||||||
U.S.
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Foreign
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
|
|
|
|
|
|
|||||||
Union-administered plans
|
|
|
|
|
|
|
||||||
$
|
|
|
$
|
|
|
$
|
|
|
|
U.S. Plans
Years ended December 31,
|
Foreign Plans
Years ended December 31,
|
||||||||||
|
2019
|
2018
|
2017
|
2019
|
2018
|
2017
|
||||||
Discount rate
|
|
|
|
|
|
|
||||||
Rate of increase in compensation levels
|
|
|
|
|
|
|
||||||
Expected long-term rate of return on plan assets
|
|
|
|
|
|
|
||||||
Gain and loss amortization period (years)
|
|
|
|
|
|
|
|
||||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Change in benefit obligations:
|
||||||||
Benefit obligations at January 1
|
$
|
|
|
$
|
|
|
||
Service cost
|
|
|
|
|
||||
Interest cost
|
|
|
|
|
||||
Actuarial (gain) loss
|
|
|
(
|
)
|
||||
Pension settlement
|
(
|
)
|
|
|
||||
Benefits paid
|
(
|
)
|
(
|
)
|
||||
Foreign currency exchange rate changes
|
|
|
(
|
)
|
||||
Benefit obligations at December 31
|
|
|
|
|
||||
Change in plan assets:
|
||||||||
Fair value of plan assets at January 1
|
|
|
|
|
||||
Actual return on plan assets
|
|
|
(
|
)
|
||||
Employer contribution
|
|
|
|
|
||||
Benefits paid
|
(
|
)
|
(
|
)
|
||||
Pension settlement
|
(
|
)
|
|
|
||||
Foreign currency exchange rate changes
|
|
|
(
|
)
|
||||
Fair value of plan assets at December 31
|
|
|
|
|
||||
Funded status
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Funded percent
|
|
%
|
|
%
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Noncurrent asset
|
$
|
|
|
$
|
|
|
||
Current liability
|
(
|
)
|
(
|
)
|
||||
Noncurrent liability
|
(
|
)
|
(
|
)
|
||||
Net amount recognized
|
$
|
(
|
)
|
$
|
(
|
)
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Prior service cost
|
$
|
|
|
$
|
|
|
||
Net actuarial loss
|
|
|
|
|
||||
Net amount recognized
|
$
|
|
|
$
|
|
|
|
U.S. Plans
December 31,
|
Foreign Plans
December 31,
|
||||||
|
2019
|
2018
|
2019
|
2018
|
||||
Discount rate
|
|
|
|
|
||||
Rate of increase in compensation levels
|
|
|
|
|
|
U.S. Plans
December 31,
|
Foreign Plans
December 31,
|
Total
December 31,
|
|||||||||||||||||||||
|
2019
|
2018
|
2019
|
2018
|
2019
|
2018
|
||||||||||||||||||
|
(In thousands)
|
|||||||||||||||||||||||
Total accumulated benefit obligations
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||||
Plans with pension obligations in excess of plan assets:
|
||||||||||||||||||||||||
PBO
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
ABO
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fair value of plan assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements at December 31, 2019
|
|||||||||||||||
Asset Category
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
|
(In thousands)
|
|||||||||||||||
Equity securities:
|
||||||||||||||||
U.S. common collective trusts
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||
Foreign common collective trusts
|
|
|
|
|
|
|
|
|
||||||||
Fixed income securities:
|
||||||||||||||||
Corporate bonds
|
|
|
|
|
|
|
|
|
||||||||
Common collective trusts
|
|
|
|
|
|
|
|
|
||||||||
Private equity and hedge funds
|
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Fair Value Measurements at December 31, 2018
|
|||||||||||||||
Asset Category
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
|
(In thousands)
|
|||||||||||||||
Equity securities:
|
||||||||||||||||
U.S. common collective trusts
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||
Foreign common collective trusts
|
|
|
|
|
|
|
|
|
||||||||
Fixed income securities:
|
||||||||||||||||
Corporate bonds
|
|
|
|
|
|
|
|
|
||||||||
Common collective trusts
|
|
|
|
|
|
|
|
|
||||||||
Private equity and hedge funds
|
|
|
|
|
|
|
|
|
||||||||
Total
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
2019
|
2018
|
|||||||
|
(In thousands)
|
|||||||
Beginning balance at January 1
|
$
|
|
|
$
|
|
|
||
Return on plan assets:
|
||||||||
Relating to assets still held at the reporting date
|
|
|
|
|
||||
Relating to assets sold during the period
|
(
|
)
|
(
|
)
|
||||
Purchases, sales, settlements and expenses
|
(
|
)
|
|
|
||||
Ending balance at December 31
|
$
|
|
|
$
|
|
|
|
(In thousands)
|
||
2020
|
$
|
|
|
2021
|
|
|
|
2022
|
|
|
|
2023
|
|
|
|
2024
|
|
|
|
2025-2029
|
|
|
|
Pension Protection Act Zone Status
|
Ryder Contributions
|
Expiration Date(s) of Collective-Bargaining Agreement(s)
|
|||||||||||||||
Pension Fund
|
Employer Identification Number
|
2019
|
2018
|
FIP/RP Status Pending/ Implemented (1)
|
2019
|
2018
|
2017
|
Surcharge Imposed
|
||||||||||
|
|
|
|
|
(In thousands)
|
|
|
|||||||||||
Western Conference Teamsters (2)
|
91-6145047
|
Green
|
Green
|
No
|
$
|
|
|
$
|
|
|
$
|
|
|
No
|
01/12/18 to 03/31/21
|
|||
IAM National (3)
|
51-6031295
|
Red
|
Green
|
RP Adopted
|
|
|
|
|
|
|
Yes
|
10/01/19 to 09/14/23
|
||||||
Automobile Mechanics Local No. 701 |
36-6042061
|
Yellow
|
Yellow
|
FIP Adopted
|
|
|
|
|
|
|
Yes
|
06/01/19 to 05/31/22
|
||||||
Other funds
|
|
|
|
|
|
|
||||||||||||
Total contributions
|
|
|
|
|
|
|
||||||||||||
Pension settlement (benefit) charges
|
|
|
(
|
)
|
|
|
||||||||||||
Union-administered plans
|
$
|
|
|
$
|
|
|
$
|
|
|
(1)
|
The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (FIP) or a rehabilitation plan (RP) is either pending or has been implemented.
|
(2)
|
The Pension Protection Act zone status is for the plan year ended December 31, 2019.
|
(3)
|
The Trustees voluntarily elected to put the fund in red status, even though the plan is at least eighty percent funded, and implemented a rehabilitation plan.
|
|
December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Cash and cash equivalents
|
$
|
|
|
$
|
|
|
||
U.S. equity mutual funds
|
|
|
|
|
||||
Foreign equity mutual funds
|
|
|
|
|
||||
Fixed income mutual funds
|
|
|
|
|
||||
Total Investments held in Rabbi Trusts
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Restructuring and other, net (1)
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
ERP implementation costs (1)
|
|
|
|
|
|
|
||||||
Goodwill impairment (2)
|
|
|
|
|
|
|
||||||
Restructuring and other items, net
|
|
|
|
|
|
|
||||||
Tax reform related bonus
|
|
|
|
|
|
|
||||||
Operating tax adjustment
|
|
|
|
|
|
|
||||||
Pension related adjustment (3)
|
|
|
|
|
|
|
||||||
Gain on sale of property (4)
|
(
|
)
|
|
|
(
|
)
|
||||||
Total
|
$
|
|
|
$
|
|
|
$
|
|
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Interest paid
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Income taxes paid
|
|
|
|
|
|
|
||||||
Changes in accounts payable related to purchases of revenue earning equipment
|
(
|
)
|
|
|
|
|
|
Years ended December 31,
|
|||||||||||
2019
|
2018
|
2017
|
||||||||||
(In thousands)
|
||||||||||||
Gains on sales of operating property and equipment
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Insurance recoveries
|
|
|
|
|
|
|
||||||
Contract settlement
|
|
|
|
|
|
|
||||||
Foreign currency transaction gains (losses)
|
|
|
(
|
)
|
|
|
||||||
Rabbi trust investment income (loss)
|
|
|
(
|
)
|
|
|
||||||
Other, net
|
|
|
|
|
|
|
||||||
Total
|
$
|
|
|
$
|
|
|
$
|
|
|
•
|
Finance, corporate services, and health and safety — allocated based upon estimated and planned resource utilization;
|
•
|
Human resources — individual costs within this category are allocated under various methods, including allocation based on estimated utilization and number of personnel supported;
|
•
|
Information technology — principally allocated based upon utilization-related metrics such as number of users or minutes of CPU time. Customer-related project costs and expenses are allocated to the business segment responsible for the project; and
|
•
|
Other — represents legal and other centralized costs and expenses including certain share-based incentive compensation costs. Expenses, where allocated, are based primarily on the number of personnel supported.
|
|
Years ended December 31,
|
|||||||||||
|
2019
|
2018
|
2017
|
|||||||||
|
(In thousands)
|
|||||||||||
Revenue:
|
||||||||||||
Fleet Management Solutions:
|
||||||||||||
ChoiceLease
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Commercial rental
|
|
|
|
|
|
|
||||||
SelectCare
|
|
|
|
|
|
|
||||||
Other
|
|
|
|
|
|
|
||||||
Fuel services revenue
|
|
|
|
|
|
|
||||||
Fleet Management Solutions
|
|
|
|
|
|
|
||||||
Supply Chain Solutions
|
|
|
|
|
|
|
||||||
Dedicated Transportation Solutions
|
|
|
|
|
|
|
||||||
Eliminations
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Total revenue
|
$
|
|
|
$
|
|
|
$
|
|
|
|||
Earnings (Loss) Before Taxes:
|
||||||||||||
Fleet Management Solutions
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
|||
Supply Chain Solutions
|
|
|
|
|
|
|
||||||
Dedicated Transportation Solutions
|
|
|
|
|
|
|
||||||
Eliminations
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
|
|
|
|
|
|
|||||||
Unallocated Central Support Services
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Non-operating pension costs (1)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Other items impacting comparability, net (2)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Earnings (loss) from continuing operations before income taxes
|
$
|
(
|
)
|
$
|
|
|
$
|
|
|
(1)
|
Non-operating pension costs include the amortization of net actuarial loss and prior service costs, interest cost and expected return on plan assets
|
(2)
|
Refer to Note 22, “Other Items Impacting Comparability,” for a discussion of items excluded from our primary measure of segment performance.
|
FMS
|
SCS
|
DTS
|
CSS
|
Eliminations
|
Total
|
|||||||||||||||
(In thousands)
|
||||||||||||||||||||
2019
|
||||||||||||||||||||
Depreciation expense (1)
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Amortization expense and other non-cash charges, net
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Interest expense (income) (2)
|
$
|
|
|
|
|
(
|
)
|
|
|
|
|
$
|
|
|
||||||
Capital expenditures paid
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Total assets
|
$
|
|
|
|
|
|
|
|
|
(
|
)
|
$
|
|
|
||||||
2018
|
||||||||||||||||||||
Depreciation expense (1)
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Amortization expense and other non-cash charges, net
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Interest expense (income) (2)
|
$
|
|
|
|
|
(
|
)
|
|
|
|
|
$
|
|
|
||||||
Capital expenditures paid
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Total assets
|
$
|
|
|
|
|
|
|
|
|
(
|
)
|
$
|
|
|
||||||
2017
|
||||||||||||||||||||
Depreciation expense (1)
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Amortization expense and other non-cash charges, net
|
$
|
|
|
|
|
|
|
(
|
)
|
|
|
$
|
|
|
||||||
Interest expense (income) (2)
|
$
|
|
|
(
|
)
|
(
|
)
|
|
|
|
|
$
|
|
|
||||||
Capital expenditures paid
|
$
|
|
|
|
|
|
|
|
|
|
|
$
|
|
|
||||||
Total assets
|
$
|
|
|
|
|
|
|
|
|
(
|
)
|
$
|
|
|
(1)
|
Depreciation expense totaling $
|
(2)
|
Interest expense was primarily allocated to the FMS segment since such borrowings were used principally to fund the purchase of revenue earning equipment used in FMS; however, interest income was also reflected in SCS and DTS based on targeted segment leverage ratios.
|
|
Years ended December 31,
|
|||||||
|
2019
|
2018
|
||||||
|
(In thousands)
|
|||||||
Long-lived assets:
|
||||||||
United States
|
$
|
|
|
$
|
|
|
||
Foreign:
|
||||||||
Canada
|
|
|
|
|
||||
Europe
|
|
|
|
|
||||
Mexico
|
|
|
|
|
||||
Singapore
|
|
|
|
|
||||
|
|
|
|
|||||
Total
|
$
|
|
|
$
|
|
|
|
|
Earnings (Loss) from Continuing Operations Before Income Taxes
|
Earnings (Loss) from
Continuing Operations
|
Earnings (Loss) from
Continuing
Operations per
Common Share
|
Net Earnings (Loss) per
Common Share
|
|||||||||||||||||||||||||||
|
Revenue
|
Net Earnings (Loss)
|
Basic
|
Diluted
|
Basic
|
Diluted
|
||||||||||||||||||||||||||
|
(In thousands, except per share amounts)
|
|||||||||||||||||||||||||||||||
2019
|
||||||||||||||||||||||||||||||||
First quarter
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||||||
Second quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Third quarter
|
|
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||
Fourth quarter
|
|
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||||||||||
Full year
|
$
|
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
||||||||
2018
|
||||||||||||||||||||||||||||||||
First quarter
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
||||||||
Second quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Third quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fourth quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Full year
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
$
|
|
|
|
|
Additions
|
|
|
|||||||||||||
Description
|
Balance at
Beginning
of Period
|
Charged to
Earnings
|
Transferred
from Other
Accounts (1)
|
Deductions (2)
|
Balance
at End
of Period
|
||||||||||||
|
(In thousands)
|
||||||||||||||||
2019
|
|||||||||||||||||
Accounts receivable allowance
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
Self-insurance accruals (3)
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
Valuation allowance on deferred tax assets
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
2018
|
|||||||||||||||||
Accounts receivable allowance
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
Self-insurance accruals (3)
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
Valuation allowance on deferred tax assets
|
$
|
|
|
(
|
)
|
|
|
|
|
$
|
|
|
|||||
2017
|
|||||||||||||||||
Accounts receivable allowance
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
Self-insurance accruals (3)
|
$
|
|
|
|
|
|
|
|
|
$
|
|
|
|||||
Valuation allowance on deferred tax assets
|
$
|
|
|
|
|
|
|
(
|
)
|
$
|
|
|
(1)
|
Transferred from other accounts includes employee contributions made to the medical and dental self-insurance plans.
|
(2)
|
Deductions represent write-offs, lease termination payments, insurance claim payments during the period and net foreign currency translation adjustments.
|
(3)
|
Self-insurance accruals include vehicle liability, workers’ compensation, property damage, cargo and medical and dental, which comprise our self-insurance programs. Amounts charged to earnings include developments in prior years' selected loss development factors, which charged earnings by $
|
Plans
|
Number of Securities to be issued upon Exercise of Outstanding Options, Warrants and Rights
|
Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights
|
Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans Excluding Securities Reflected in Column (a)
|
||||||||
(a)
|
(b)
|
(c)
|
|||||||||
Equity compensation plans approved by security holders:
|
|||||||||||
Broad based employee stock plans
|
2,935,754
|
|
(1)
|
$69.69
|
(3)
|
656,593
|
|
||||
Employee stock purchase plan
|
—
|
|
—
|
|
356,649
|
|
|||||
Non-employee directors' stock plans
|
209,917
|
|
(2)
|
—
|
|
37,484
|
|
||||
Total
|
3,145,671
|
|
$69.69
|
1,050,726
|
|
(1)
|
Includes 1,989,773 stock options, 526,420 time-vested restricted stock awards, 17,880 market-based restricted stock awards and 401,681 performance-based restricted stock awards, which includes 27,392 performance-based restricted stock rights not considered granted under accounting guidance for stock compensation. Refer to Note 19, "Share-Based Compensation Plans", for additional information.
|
(2)
|
Includes 204,079 time-vested restricted stock awards, as well as 5,838 time-vested restricted stock awards awarded to non-executive directors and vested but not exercisable until six months after the director's retirement.
|
(3)
|
Weighted-average exercise price of outstanding options excludes restricted stock awards and restricted stock units.
|
(a)
|
Items A through H and Schedule II are presented on the following pages of this Form 10-K Annual Report:
|
|
|
Page No.
|
1. Financial Statements for Ryder System, Inc. and Consolidated Subsidiaries:
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
2. Consolidated Financial Statement Schedule for the Years Ended December 31, 2019, 2018 and 2017
|
|
|
Exhibit
Number
|
|
Description
|
||
3.1
|
||||
3.2
|
|
|||
4.1
|
|
Ryder hereby agrees, pursuant to paragraph (b)(4)(iii) of Item 601 of Regulation S-K, to furnish the Commission with a copy of any instrument defining the rights of holders of long-term debt of Ryder, where such instrument has not been filed as an exhibit hereto and the total amount of securities authorized there under does not exceed 10% of the total assets of Ryder and its subsidiaries on a consolidated basis.
|
||
4.2
|
|
The First Supplemental Indenture between Ryder System, Inc. and The Chase Manhattan Bank (National Association) dated October 1, 1987, previously filed with the Commission as an exhibit to Ryder's Annual Report on Form 10-K for the year ended December 31, 1994, is incorporated by reference into this report.
|
||
4.3
|
|
The Form of Indenture between Ryder System, Inc. and The Chase Manhattan Bank (National Association) dated as of May 1, 1987, and supplemented as of November 15, 1990 and June 24, 1992, filed with the Commission on July 30, 1992 as an exhibit to Ryder's Registration Statement on Form S-3 (No. 33-50232), is incorporated by reference into this report.
|
||
4.4
|
|
|||
4.5
|
||||
4.6
|
||||
10.1*
|
|
|||
10.2*
|
|
|||
10.3*
|
|
|||
10.4*
|
||||
10.5*
|
||||
10.6*
|
Exhibit
Number
|
|
Description
|
10.7*
|
||
10.8*
|
||
10.9*
|
||
10.10*
|
||
10.11*
|
||
10.12*
|
||
10.13*
|
||
10.14*
|
||
10.15*
|
||
10.16*
|
||
10.17*
|
||
10.18*
|
||
10.19*
|
||
10.20*
|
||
10.21*
|
||
10.22*
|
||
10.23*
|
|
Exhibit
Number
|
|
Description
|
10.24*
|
|
|
10.25*
|
||
10.26
|
||
10.27*
|
||
10.28*
|
||
10.29*
|
||
10.30*
|
||
10.31*
|
||
10.32*
|
||
10.33*
|
||
10.34*
|
||
10.35*
|
||
10.36*
|
||
10.37*
|
||
10.38*
|
||
10.39*
|
||
21.1
|
|
|
23.1
|
|
Exhibit
Number
|
|
Description
|
||
24
|
||||
Robert J. Eck
|
David G. Nord
|
|||
Robert A. Hagemann
|
Abbie J. Smith
|
|||
Michael F. Hilton
|
E. Follin Smith
|
|||
Tamara L. Lundgren
|
Dmitri L. Stockton
|
|||
Luis P. Nieto
|
Hansel E. Tookes
|
|||
31.1
|
|
|||
31.2
|
|
|||
32
|
|
|||
101.INS
|
|
Inline XBRL Instance Document.
|
||
101.SCH
|
|
Inline XBRL Taxonomy Extension Schema Document.
|
||
101.CAL
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document.
|
||
101.DEF
|
|
Inline XBRL Taxonomy Extension Definition Linkbase Document.
|
||
101.LAB
|
|
Inline XBRL Taxonomy Extension Label Linkbase Document.
|
||
101.PRE
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
|
||
104
|
Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).
|
Date:
|
February 27, 2020
|
|
RYDER SYSTEM, INC.
|
|
By: /s/ ROBERT E. SANCHEZ
|
||
|
Robert E. Sanchez
|
||
|
Chairman, President and Chief Executive Officer
|
Date:
|
February 27, 2020
|
|
By: /s/ ROBERT E. SANCHEZ
|
|
Robert E. Sanchez
|
||
|
Chairman, President and Chief Executive Officer
|
||
|
(Principal Executive Officer)
|
||
Date:
|
February 27, 2020
|
|
By: /s/ SCOTT T. PARKER
|
|
Scott T. Parker
|
||
|
Executive Vice President and Chief Financial Officer
|
||
|
(Principal Financial Officer)
|
||
Date:
|
February 27, 2020
|
|
By: /s/ FRANK MULLEN
|
|
Frank Mullen
|
||
|
Vice President and Controller
|
||
(Principal Accounting Officer)
|
|||
Date:
|
February 27, 2020
|
|
By: ROBERT J. ECK *
|
|
Robert J. Eck
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
|
By: ROBERT A. HAGEMANN *
|
|
Robert A. Hagemann
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
|
By: MICHAEL F. HILTON*
|
|
Michael F. Hilton
|
||
|
Director
|
Date:
|
February 27, 2020
|
|
By: TAMARA L. LUNDGREN*
|
|
Tamara L. Lundgren
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
|
By: LUIS P. NIETO, JR. *
|
|
Luis P. Nieto, Jr.
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
By: DAVID G. NORD *
|
|
David G. Nord
|
|||
Director
|
|||
Date:
|
February 27, 2020
|
|
By: ABBIE J. SMITH *
|
|
Abbie J. Smith
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
|
By: E. FOLLIN SMITH *
|
|
E. Follin Smith
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
By: DMITRI L. STOCKTON *
|
|
Dmitri L. Stockton
|
|||
Director
|
|||
Date:
|
February 27, 2020
|
|
By: HANSEL E. TOOKES, II *
|
|
Hansel E. Tookes, II
|
||
|
Director
|
||
Date:
|
February 27, 2020
|
|
*By: /s/ ALENA BRENNER
|
|
Alena Brenner
|
||
|
Attorney-in-Fact, pursuant to a power of attorney
|
||