Werner Enterprises, Inc. (NASDAQ: WERN) was founded in 1956 by Clarence L. Werner. It is a transportation and logistics company, headquartered in Omaha, Nebraska, United States. It ships to the USA, Canada, Mexico, Asia, Europe and South America. Werner has regional offices throughout North America, in China and recently in Australia. Werner is among the five largest carriers in the United States, with services that include dedicated, medium-to-long-haul, regional and local van capacity, expedited, temperature-controlled and flatbed. Werner also offers freight management, truck brokerage, intermodal, load/mode and network optimization and freight forwarding. Werner, through its subsidiary companies, is a licensed U.S. NVOCC, U.S. Customs Broker, licensed Freight Forwarder in China, licensed China NVOCC, TSA-approved Indirect Air Carrier and IATA Accredited Cargo Agent.
Werner has three main divisions that operate in the U.S., Canada, and Mexico. They are the Temperature Controlled Division (TCU), Flatbed, and Dry Van. The dry van division is the largest of the three.
Werner operates 11 terminals in the United States and has a terminal in Milton, Ontario. Of the 11 terminals operated 9 are full service terminals meaning that drivers are able to have their tractors and trailers serviced there while resting or conducting safety meetings. The other terminals offer a drop yard and safety services but no maintenance facilities.
Werner Enterprises was the first trucking company to use the paperless log system. In June 1998 Werner Enterprises and the Federal Motor Carrier Safety Administration (FMCSA) entered into a pilot program to use a "paperless" log system designed to replace the paper logbooks for recording drivers Hours Of Service (HOS) duty statuses. This process was tested and monitored by the FMCSA for a period of six years. Through the six year period drivers used the computer system via the Qualcomm on board computers in the truck and still maintaining a paper log while the system was perfected. From 1995 through September 2004 Werner continued to improve the paperless log system and in this time contacted the Federal Highway Administration (FHWA) and informed them of their findings and showed Werner's commitment to the safety of their drivers and more importantly the motoring public. On September 21, 2004 the FMCSA granted Werner Enterprises an exemption from paper log use and in December 2004 was formally granted the exemption at a ceremony at the corporate headquarters in Omaha, Nebraska. To this date Werner Enterprises is one of two major motor carriers who use paperless logs: the other is Schneider National.
Werner Enterprises, Inc., headquartered in Omaha, Nebraska, is the fourth largest trucking company in the United States. Founded by Clarence L. Werner in 1956, it is a publicly traded company led by the Werner family, which retains 40 percent ownership. Werner's fleet of 5,500 trucks and 15,000 trailers serves the United States and Canada, and the company operates trailer service in Mexico. Werner offers a variety of transportation services, and transports a range of goods that includes beverages and foodstuffs, containers and paper products, lumber and building materials, plastic and metal products, and retail merchandise. In the 1990s, Werner Enterprises had increasingly moved into specialty trucking, including dedicated fleet services. Innovations such as the company's paperless log system have helped put Werner at the forefront of growth in the trucking industry, and its stock has been a consistently strong performer; however, like other trucking companies, it suffers from a dearth of available drivers.
Werner Enterprises, Inc., incorporated in September 14, 1982, is a transportation and logistics company engaged in hauling truckload shipments of general commodities in both interstate and intrastate commerce. It also provides logistics services through the value added services (VAS) division. The Company operates in two business segments: Truckload Transportation Services (Truckload) and VAS. At December 31, 2009, the Company had a fleet of 7250 trucks, of which 6575 were owned by the Company and 675 were owned and operated by independent owner-operator drivers. At December 31, 2009, the Company operated 23,880 trailers. It included 22,515 dry vans, 400 flatbeds, 956 temperature-controlled trailers and nine specialized trailers.
Truckload
The Truckload segment includes six operating fleets: the dedicated services fleet (Dedicated) provides truckload services required by a specific customer, generally for a distribution center or manufacturing facility; the regional short-haul (Regional) fleet transports a range of consumer nondurable products and other commodities in truckload quantities within five geographic regions across the United States using dry van trailers; the medium-to-long- haul van (Van) fleet provides comparable truckload van service, over irregular routes; the expedited (Expedited) fleet provides time-sensitive truckload services utilizing driver teams; the flatbed (Flatbed), and temperature- controlled (Temperature-Controlled) fleets provide truckload services for products with specialized trailers.
The Truckload fleets operate throughout the 48 contiguous states of the United States pursuant to operating authority, both common and contract, granted by the United States Department of Transportation (DOT) and pursuant to intrastate authority granted by various states of the United States. The Company also have authority to operate in several provinces of Canada and to provide through-trailer service into and out of Mexico. The principal types of freight transported by the Company include retail store merchandise, consumer products, and grocery products and manufactured products. It focuses on transporting consumer nondurable products that generally ship more consistently throughout the year and whose volumes are generally more stable during a slowdown in the economy.
VAS
The VAS segment is a non-asset-based transportation and logistics provider. VAS is comprised of four operating units, which provide non-trucking services to the customers. Truck brokerage (Brokerage) uses contracted carriers to complete customer shipments; freight management (Freight Management) offers a range of single-source logistics management services and solutions; the intermodal (Intermodal) unit offers rail transportation through alliances with rail and drayage providers as an alternative to truck transportation, and Werner Global Logistics international (International) provides complete management of global shipments from origin to destination using a combination of air, ocean, truck and rail transportation modes. As of December 31, 2009, the Brokerage unit had transportation services contracts with over 5,800 carriers.
In addition to the construction of the 66,000-square-foot disaster recovery building, in 1997 Werner Enterprises was also building a 140,000-square-foot office building. The latter, on the east side of Nebraska Highway 50, would augment the existing headquarters building of 110,000 square feet on the west side of the highway. "The new building will more than double our headquarters office space," Synowicki told the Omaha World-Herald. "It should hold us for another five years."
With a goal having been set to grow its business by 15 percent yearly, Werner's facilities were expanding quickly as well. "We had about five acres when we first moved to this headquarters site," Synowicki stated. "Now we have more than 200 acres and are still growing." Its growth had an increasing effect on that of Omaha itself: as Steve Jordon of the Omaha World-Herald reported in June 1997, the expansion "would be a key to opening a new industrial development area south of Interstate 80 and east of Nebraska Highway 50." In 1998 or soon thereafter, according to Werner Enterprises Executive Vice-President and General Counsel Richard S. Reiser, the company's trailer shop and later its body shop would move to the east side of the highway, leaving room for the headquarters building to expand into what was a parking area.
With so much growth taking place, one of the problems faced by both Werner Enterprises and its competitors was finding enough capable drivers. In February 1997, John Taylor of the Omaha World-Herald reported that Green Bay, Wisconsin's Schneider National, Inc., the number-one trucking company in the nation, had come to Werner Enterprises' backyard to recruit 125 drivers. Officials at Werner refused to comment on the Omaha recruitment effort by its competitor, but they did say that the company had been forced to turn down business due to lack of drivers. "Some trucking industry analysts," Taylor reported, "have said there is no shortage of people qualified to drive trucks; instead, they say, potential drivers don't seek work because they don't like the wages, hours, working conditions and the fact that they have to be away from home." For this reason, "Trucking companies like Werner have boosted pay in recent years." Although Taylor did not provide figures for Werner, he reported that at Schneider, new drivers could expect to earn as much as $36,000 a year, while drivers with three years' experience could earn up to $50,000.
In line with its continued growth as a company, in 1993 Werner Enterprises had moved into intermodal transportation, which combines trucking and rail transport. In April 1997, it signed an agreement with Hub Group, the largest intermodal marketing company in the United States, to market each other's services to customers. It had also created a division to handle logistics in 1995.
One of Werner Enterprises' most significant customers in the late 1990s was retailer Dollar General, for whom it began providing dedicated trucking services in 1996. In September 1997, Werner began handling a number of services for Dollar General distribution centers in Oklahoma, Virginia, Kentucky, and Georgia. In February 1998, Werner signed an agreement with Dollar General whereby it would handle all trucking operations at the four distribution centers. Thus, the Dollar General dedicated fleet soon grew from 150 to 400 trucks.
In December 1997, Werner Enterprises announced a plan to buy back as many as two million shares of its common stock, presumably to drive up the value of what its leadership believed were undervalued certificates. In the following month, January 1998, the company reported record earnings for 1997. Revenues for the fourth quarter, for instance, had increased to $206 million, marking a 22 percent increase over fourth quarter revenues in 1996. Furthermore, profits grew by 23 percent, to almost $14.2 million for the quarter.
At that point, Werner Enterprises was solidly in fourth place among trucking companies in the United States. Schneider, with $2.5 billion, was still far ahead of the pack, with J.B. Hunt and Landstar also ahead of Werner as billion-dollar corporations. Werner reported that it expected to hit the $1 billion mark in 1999. These four companies--along with Swift Transportation, completing the "Big Five"--each experienced 15 to 20 percent growth every year. Moreover, the big were only going to get bigger, because consolidation was increasingly becoming the rule in trucking just as in other types of business.
In June 1998, Werner Enterprises--which had long emphasized information technology and the use of the latest advancements in communication--got a jump on its competitors when it introduced a "paperless log system." According to a company press release, Federal Highway Administrator Kenneth Wykle had come to Omaha to sign an agreement with Clarence Werner whereby Werner Enterprises would be the first national trucking company to make use of satellite logging technology rather than paper logbooks to follow truck movement and truckers' work hours. Drivers' hours and activities would automatically be recorded throughout the day on a computer keyboard unit located in their trucks, which would then transfer the information to Werner's computer system in Omaha. According to Clarence Werner, Werner Enterprises had worked three years to create the paperless log system, but "the long-term benefits for our customers, the general public, and Werner Enterprises far outweighs the significant investment of resources." And thus, the company moved into the end of the century much the same way it had been operating for years--successfully integrating new technologies and ideas into its daily operations for the good of its customers and its own growth.
Principal Subsidiaries: Werner Leasing, Inc.; Werner Aire, Inc.; Drivers Management, Inc.; Fleet Truck Sales, Inc.; Werner Transportation, Inc.
OVERALL
Beta: 0.61
Market Cap (Mil.): $1,817.74
Shares Outstanding (Mil.): 72.80
Annual Dividend: 0.20
Yield (%): 0.80
FINANCIALS
WERN.O Industry Sector
P/E (TTM): 21.30 17.14 19.19
EPS (TTM): 39.88 -- --
ROI: 8.37 6.82 4.28
ROE: 12.20 8.42 7.46
Statistics:
Public Company
Incorporated: 1956
Employees: 7,521
Operating Revenues: $772.09 million (1997)
Stock Exchanges: NASDAQ
Ticker Symbol: WERN
SICs: 4213 Trucking Except Local
Name Age Since Current Position
Clarence Werner 73 2007 Chairman of the Board
Gregory Werner 51 2007 President, Chief Executive Officer, Director
Gary Werner 53 1997 Vice Chairman of the Board
John Steele 53 2005 Executive Vice President, Chief Financial Officer, Treasurer
Derek Leathers 41 2008 Chief Operating Officer, Senior Executive Vice President
James Johnson 47 2010 Executive Vice President, Chief Accounting Officer, Corporate Secretary
James Mullen 42 2010 Executive Vice President, General Counsel
Jim Schelble 50 2005 Executive Vice President - Sales and Marketing
Robert Synowicki 52 2010 Executive Vice President - Driver Resources
H. Marty Nordlund 49 2006 Senior Executive Vice President - Specialized Services
Gerald Timmerman 71 1988 Independent Director
Michael Steinbach 56 2002 Independent Director
Kenneth Bird 63 2002 Independent Director
Patrick Jung 63 2003 Independent Director
Duane Sather 66 2006 Independent Director
Address:
14507 Frontier Road
Omaha, Nebraska 68145-0308
U.S.A.
Werner has three main divisions that operate in the U.S., Canada, and Mexico. They are the Temperature Controlled Division (TCU), Flatbed, and Dry Van. The dry van division is the largest of the three.
Werner operates 11 terminals in the United States and has a terminal in Milton, Ontario. Of the 11 terminals operated 9 are full service terminals meaning that drivers are able to have their tractors and trailers serviced there while resting or conducting safety meetings. The other terminals offer a drop yard and safety services but no maintenance facilities.
Werner Enterprises was the first trucking company to use the paperless log system. In June 1998 Werner Enterprises and the Federal Motor Carrier Safety Administration (FMCSA) entered into a pilot program to use a "paperless" log system designed to replace the paper logbooks for recording drivers Hours Of Service (HOS) duty statuses. This process was tested and monitored by the FMCSA for a period of six years. Through the six year period drivers used the computer system via the Qualcomm on board computers in the truck and still maintaining a paper log while the system was perfected. From 1995 through September 2004 Werner continued to improve the paperless log system and in this time contacted the Federal Highway Administration (FHWA) and informed them of their findings and showed Werner's commitment to the safety of their drivers and more importantly the motoring public. On September 21, 2004 the FMCSA granted Werner Enterprises an exemption from paper log use and in December 2004 was formally granted the exemption at a ceremony at the corporate headquarters in Omaha, Nebraska. To this date Werner Enterprises is one of two major motor carriers who use paperless logs: the other is Schneider National.
Werner Enterprises, Inc., headquartered in Omaha, Nebraska, is the fourth largest trucking company in the United States. Founded by Clarence L. Werner in 1956, it is a publicly traded company led by the Werner family, which retains 40 percent ownership. Werner's fleet of 5,500 trucks and 15,000 trailers serves the United States and Canada, and the company operates trailer service in Mexico. Werner offers a variety of transportation services, and transports a range of goods that includes beverages and foodstuffs, containers and paper products, lumber and building materials, plastic and metal products, and retail merchandise. In the 1990s, Werner Enterprises had increasingly moved into specialty trucking, including dedicated fleet services. Innovations such as the company's paperless log system have helped put Werner at the forefront of growth in the trucking industry, and its stock has been a consistently strong performer; however, like other trucking companies, it suffers from a dearth of available drivers.
Werner Enterprises, Inc., incorporated in September 14, 1982, is a transportation and logistics company engaged in hauling truckload shipments of general commodities in both interstate and intrastate commerce. It also provides logistics services through the value added services (VAS) division. The Company operates in two business segments: Truckload Transportation Services (Truckload) and VAS. At December 31, 2009, the Company had a fleet of 7250 trucks, of which 6575 were owned by the Company and 675 were owned and operated by independent owner-operator drivers. At December 31, 2009, the Company operated 23,880 trailers. It included 22,515 dry vans, 400 flatbeds, 956 temperature-controlled trailers and nine specialized trailers.
Truckload
The Truckload segment includes six operating fleets: the dedicated services fleet (Dedicated) provides truckload services required by a specific customer, generally for a distribution center or manufacturing facility; the regional short-haul (Regional) fleet transports a range of consumer nondurable products and other commodities in truckload quantities within five geographic regions across the United States using dry van trailers; the medium-to-long- haul van (Van) fleet provides comparable truckload van service, over irregular routes; the expedited (Expedited) fleet provides time-sensitive truckload services utilizing driver teams; the flatbed (Flatbed), and temperature- controlled (Temperature-Controlled) fleets provide truckload services for products with specialized trailers.
The Truckload fleets operate throughout the 48 contiguous states of the United States pursuant to operating authority, both common and contract, granted by the United States Department of Transportation (DOT) and pursuant to intrastate authority granted by various states of the United States. The Company also have authority to operate in several provinces of Canada and to provide through-trailer service into and out of Mexico. The principal types of freight transported by the Company include retail store merchandise, consumer products, and grocery products and manufactured products. It focuses on transporting consumer nondurable products that generally ship more consistently throughout the year and whose volumes are generally more stable during a slowdown in the economy.
VAS
The VAS segment is a non-asset-based transportation and logistics provider. VAS is comprised of four operating units, which provide non-trucking services to the customers. Truck brokerage (Brokerage) uses contracted carriers to complete customer shipments; freight management (Freight Management) offers a range of single-source logistics management services and solutions; the intermodal (Intermodal) unit offers rail transportation through alliances with rail and drayage providers as an alternative to truck transportation, and Werner Global Logistics international (International) provides complete management of global shipments from origin to destination using a combination of air, ocean, truck and rail transportation modes. As of December 31, 2009, the Brokerage unit had transportation services contracts with over 5,800 carriers.
In addition to the construction of the 66,000-square-foot disaster recovery building, in 1997 Werner Enterprises was also building a 140,000-square-foot office building. The latter, on the east side of Nebraska Highway 50, would augment the existing headquarters building of 110,000 square feet on the west side of the highway. "The new building will more than double our headquarters office space," Synowicki told the Omaha World-Herald. "It should hold us for another five years."
With a goal having been set to grow its business by 15 percent yearly, Werner's facilities were expanding quickly as well. "We had about five acres when we first moved to this headquarters site," Synowicki stated. "Now we have more than 200 acres and are still growing." Its growth had an increasing effect on that of Omaha itself: as Steve Jordon of the Omaha World-Herald reported in June 1997, the expansion "would be a key to opening a new industrial development area south of Interstate 80 and east of Nebraska Highway 50." In 1998 or soon thereafter, according to Werner Enterprises Executive Vice-President and General Counsel Richard S. Reiser, the company's trailer shop and later its body shop would move to the east side of the highway, leaving room for the headquarters building to expand into what was a parking area.
With so much growth taking place, one of the problems faced by both Werner Enterprises and its competitors was finding enough capable drivers. In February 1997, John Taylor of the Omaha World-Herald reported that Green Bay, Wisconsin's Schneider National, Inc., the number-one trucking company in the nation, had come to Werner Enterprises' backyard to recruit 125 drivers. Officials at Werner refused to comment on the Omaha recruitment effort by its competitor, but they did say that the company had been forced to turn down business due to lack of drivers. "Some trucking industry analysts," Taylor reported, "have said there is no shortage of people qualified to drive trucks; instead, they say, potential drivers don't seek work because they don't like the wages, hours, working conditions and the fact that they have to be away from home." For this reason, "Trucking companies like Werner have boosted pay in recent years." Although Taylor did not provide figures for Werner, he reported that at Schneider, new drivers could expect to earn as much as $36,000 a year, while drivers with three years' experience could earn up to $50,000.
In line with its continued growth as a company, in 1993 Werner Enterprises had moved into intermodal transportation, which combines trucking and rail transport. In April 1997, it signed an agreement with Hub Group, the largest intermodal marketing company in the United States, to market each other's services to customers. It had also created a division to handle logistics in 1995.
One of Werner Enterprises' most significant customers in the late 1990s was retailer Dollar General, for whom it began providing dedicated trucking services in 1996. In September 1997, Werner began handling a number of services for Dollar General distribution centers in Oklahoma, Virginia, Kentucky, and Georgia. In February 1998, Werner signed an agreement with Dollar General whereby it would handle all trucking operations at the four distribution centers. Thus, the Dollar General dedicated fleet soon grew from 150 to 400 trucks.
In December 1997, Werner Enterprises announced a plan to buy back as many as two million shares of its common stock, presumably to drive up the value of what its leadership believed were undervalued certificates. In the following month, January 1998, the company reported record earnings for 1997. Revenues for the fourth quarter, for instance, had increased to $206 million, marking a 22 percent increase over fourth quarter revenues in 1996. Furthermore, profits grew by 23 percent, to almost $14.2 million for the quarter.
At that point, Werner Enterprises was solidly in fourth place among trucking companies in the United States. Schneider, with $2.5 billion, was still far ahead of the pack, with J.B. Hunt and Landstar also ahead of Werner as billion-dollar corporations. Werner reported that it expected to hit the $1 billion mark in 1999. These four companies--along with Swift Transportation, completing the "Big Five"--each experienced 15 to 20 percent growth every year. Moreover, the big were only going to get bigger, because consolidation was increasingly becoming the rule in trucking just as in other types of business.
In June 1998, Werner Enterprises--which had long emphasized information technology and the use of the latest advancements in communication--got a jump on its competitors when it introduced a "paperless log system." According to a company press release, Federal Highway Administrator Kenneth Wykle had come to Omaha to sign an agreement with Clarence Werner whereby Werner Enterprises would be the first national trucking company to make use of satellite logging technology rather than paper logbooks to follow truck movement and truckers' work hours. Drivers' hours and activities would automatically be recorded throughout the day on a computer keyboard unit located in their trucks, which would then transfer the information to Werner's computer system in Omaha. According to Clarence Werner, Werner Enterprises had worked three years to create the paperless log system, but "the long-term benefits for our customers, the general public, and Werner Enterprises far outweighs the significant investment of resources." And thus, the company moved into the end of the century much the same way it had been operating for years--successfully integrating new technologies and ideas into its daily operations for the good of its customers and its own growth.
Principal Subsidiaries: Werner Leasing, Inc.; Werner Aire, Inc.; Drivers Management, Inc.; Fleet Truck Sales, Inc.; Werner Transportation, Inc.
OVERALL
Beta: 0.61
Market Cap (Mil.): $1,817.74
Shares Outstanding (Mil.): 72.80
Annual Dividend: 0.20
Yield (%): 0.80
FINANCIALS
WERN.O Industry Sector
P/E (TTM): 21.30 17.14 19.19
EPS (TTM): 39.88 -- --
ROI: 8.37 6.82 4.28
ROE: 12.20 8.42 7.46
Statistics:
Public Company
Incorporated: 1956
Employees: 7,521
Operating Revenues: $772.09 million (1997)
Stock Exchanges: NASDAQ
Ticker Symbol: WERN
SICs: 4213 Trucking Except Local
Name Age Since Current Position
Clarence Werner 73 2007 Chairman of the Board
Gregory Werner 51 2007 President, Chief Executive Officer, Director
Gary Werner 53 1997 Vice Chairman of the Board
John Steele 53 2005 Executive Vice President, Chief Financial Officer, Treasurer
Derek Leathers 41 2008 Chief Operating Officer, Senior Executive Vice President
James Johnson 47 2010 Executive Vice President, Chief Accounting Officer, Corporate Secretary
James Mullen 42 2010 Executive Vice President, General Counsel
Jim Schelble 50 2005 Executive Vice President - Sales and Marketing
Robert Synowicki 52 2010 Executive Vice President - Driver Resources
H. Marty Nordlund 49 2006 Senior Executive Vice President - Specialized Services
Gerald Timmerman 71 1988 Independent Director
Michael Steinbach 56 2002 Independent Director
Kenneth Bird 63 2002 Independent Director
Patrick Jung 63 2003 Independent Director
Duane Sather 66 2006 Independent Director
Address:
14507 Frontier Road
Omaha, Nebraska 68145-0308
U.S.A.