Landstar System (LSTR) 8-K Landstar System Reports 35 Percent Increase In Fourth Quarter Earnings Per Share

Exhibit 99.1

For Immediate Release	Contact: Jim Gattoni
	Landstar System, Inc.
	www.landstar.com
February 1, 2011	904-398-9400

LANDSTAR SYSTEM REPORTS 35 PERCENT INCREASE IN
FOURTH QUARTER EARNINGS PER SHARE

Jacksonville, FL — Landstar System, Inc. (NASDAQ: LSTR) reported 2010 fourth quarter net income of $24.1 million, or $0.50 per diluted share, compared to net income of $18.6 million, or $0.37 per diluted share, for the 2009 fourth quarter. Revenue for the 2010 fourth quarter was $587.5 million compared to $547.7 million in the 2009 fourth quarter.

Truck transportation revenue hauled by independent business capacity owners (“BCOs”) and truck brokerage carriers in the 2010 fourth quarter was $537.6 million, or 91 percent of revenue, compared to $498.4 million, or 91 percent of revenue, in the 2009 fourth quarter. In the 2010 and 2009 fourth quarters, the Company invoiced customers $51.1 million and $40.7 million, respectively, of fuel surcharges that were passed 100 percent to BCOs and excluded from revenue. Revenue hauled by rail, air and ocean cargo carriers was $36.7 million, or 6 percent of revenue, in the 2010 fourth quarter compared to $35.0 million, or 6 percent of revenue, in the 2009 fourth quarter. Transportation management fee revenue generated by the supply chain solutions companies was $4.4 million, or 1 percent of revenue, in both the 2010 and 2009 fourth quarters.

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Commenting on Landstar’s 2010 fourth quarter, Henry Gerkens, Landstar’s Chairman, President and CEO said, “I am very pleased with the way the Company finished the year. Operating income and diluted earnings per share in the 2010 fourth quarter increased 30 percent and 35 percent, respectively, over the 2009 fourth quarter. Gross profit, defined as revenue less the cost of purchased transportation and commissions to agents, in the 2010 fourth quarter increased 8 percent over the 2009 fourth quarter. As anticipated, revenue in the 2010 fourth quarter compared to revenue in the 2009 fourth quarter was negatively impacted by a significant decrease in the number of loads hauled under the Company’s less-than-truckload substitute line haul service offering. Revenue under the Company’s less-than-truckload substitute line haul service offering decreased to 4 percent of revenue in the 2010 fourth quarter compared to 13 percent of revenue in the 2009 fourth quarter. Excluding the impact of the revenue decline in this service offering, the total number of truck transportation loads hauled in the 2010 fourth quarter increased 8 percent over the 2009 fourth quarter and revenue per load for truck transportation for the fourth quarter of 2010 increased 12 percent over the 2009 fourth quarter. In addition, the number of loads hauled by air and ocean carriers in the 2010 fourth quarter increased 50 percent and 31 percent, respectively, over the 2009 fourth quarter.”

“Landstar continues to generate outstanding returns. Return on average shareholder’s equity was 32 percent and return on invested capital, net income divided by the sum of average equity plus average debt, was 22 percent. Landstar System, Inc. also announced that its Board of Directors has declared a quarterly dividend of $0.05 per share. The dividend is payable on March 11, 2011 to stockholders of record at the close of business on February 14, 2011. It is the intention of the Board of Directors to continue to pay a quarterly dividend. During the 2010 fourth quarter, Landstar purchased 1,277,000 shares of its common stock at a total cost of $48.1 million. During 2010, the Company purchased 2,653,000 shares of its common stock at a total cost of $102.7 million. Under the Company’s authorized share purchase program, the Company currently has a total of 723,000 shares of its common stock available for purchase.”

Gerkens continued, “As reported by FIRST CALL, the current ranges of analysts’ earnings estimates for the 2011 first quarter and full year are $0.38 to $0.45 per diluted share and $1.95 to $2.29 per diluted share. Based upon current revenue trends and the anticipated continuation of those trends through the balance of the year, I am comfortable with the current range of analysts’ earnings estimates for both the 2011 first quarter and full year.”

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Landstar will provide a live webcast of its quarterly earnings conference call this afternoon at 2:00 pm ET. To access the webcast, visit the Company’s website at www.landstar.com; click on “Investor Relations” and “Webcasts,” then click on “Landstar’s Fourth Quarter 2010 Earnings Release Conference Call.”

The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995. Statements contained in this press release that are not based on historical facts are “forward-looking statements”. This press release contains forward-looking statements, such as statements which relate to Landstar’s business objectives, plans, strategies, expectations and intentions. Terms such as “anticipates,” “believes,” “estimates,” “intention,” “plans,” “predicts,” “may,” “should,” “will,” the negative thereof and similar expressions are intended to identify forward-looking statements. Such statements are by nature subject to uncertainties and risks, including but not limited to: an increase in the frequency or severity of accidents or workers’ compensation claims; unfavorable development of existing claims; dependence on independent sales agents; dependence on third-party capacity providers; disruptions or failures in our computer systems; a downturn in domestic or international economic growth or growth in the transportation sector; substantial industry competition; and other operational, financial or legal risks or uncertainties detailed in Landstar’s Form 10K for the 2009 fiscal year, described in Item 1A Risk Factors, and other SEC filings from time-to-time. These risks and uncertainties could cause actual results or events to differ materially from historical results or those anticipated. Investors should not place undue reliance on such forward-looking statements, and Landstar undertakes no obligation to publicly update or revise any forward-looking statements.

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About Landstar:
Landstar System, Inc. is a non-asset based provider of integrated supply chain solutions. Landstar delivers safe, specialized transportation, warehousing and logistics services to a broad range of customers worldwide utilizing a network of agents, third-party capacity owners and employees. All Landstar transportation companies are certified to ISO 9001:2008 quality management system standards and RC14001:2008 environmental, health, safety and security management system standards. Landstar System, Inc. is headquartered in Jacksonville, Florida. Its common stock trades on The NASDAQ Stock Market^® under the symbol LSTR.

(Tables follow)

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Landstar System, Inc. and Subsidiary
Consolidated Statements of Income
(Dollars in thousands, except per share amounts)
(Unaudited)

	Fiscal Year Ended						Thirteen Weeks Ended
	December 25,			December 26,			December 25,			December 26,
	2010			2009			2010			2009
Revenue	$	2,400,170		$	2,008,796		$	587,535		$	547,715
Investment income		1,558			1,268			489			314
Costs and expenses:
Purchased transportation		1,824,308			1,503,520			442,353			413,301
Commissions to agents		181,405			160,571			46,710			42,836
Other operating costs		28,826			29,173			6,874			7,424
Insurance and claims		49,334			45,918			11,725			16,862
Selling, general and administrative		153,080			133,612			38,194			33,922
Depreciation and amortization		24,804			23,528			6,360			6,114
Total costs and expenses		2,261,757			1,896,322			552,216			520,459
Operating income		139,971			113,742			35,808			27,570
Interest and debt expense		3,623			4,030			924			937
Income before income taxes		136,348			109,712			34,884			26,633
Income taxes		49,766			39,762			11,005			8,296
Net income		86,582			69,950			23,879			18,337
Less: Net loss attributable to noncontrolling interest		(932	)		(445	)		(220	)		(231	)
Net income attributable to Landstar System, Inc. and subsidiary	$	87,514		$	70,395		$	24,099		$	18,568
Earnings per common share attributable to Landstar System, Inc. and subsidiary	$	1.77		$	1.38		$	0.50		$	0.37
Diluted earnings per share attributable to Landstar System, Inc. and subsidiary	$	1.77		$	1.37		$	0.50		$	0.37
Average number of shares outstanding:
Earnings per common share		49,523,000			51,095,000			48,327,000			50,404,000
Diluted earnings per share		49,580,000			51,280,000			48,358,000			50,594,000
Dividends paid per common share	$	0.1900		$	0.1700		$	0.0500		$	0.0450

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Landstar System, Inc. and Subsidiary
Consolidated Balance Sheets
(Dollars in thousands, except per share amounts)
(Unaudited)

	Dec. 25,			Dec. 26,
	2010			2009
ASSETS
Current assets:
Cash and cash equivalents	$	44,706		$	85,719
Short-term investments		23,266			24,325
Trade accounts receivable, less allowance of $5,324 and $5,547		307,350			278,854
Other receivables, including advances to independent contractors, less allowance of $5,511 and $5,797		23,943			18,149
Deferred income taxes and other current assets		21,652			19,565
Total current assets		420,917			426,612
Operating property, less accumulated depreciation and amortization of $137,830 and $124,810		132,649			116,656
Goodwill		57,470			57,470
Other assets		72,846			48,054
Total assets	$	683,882		$	648,792
LIABILITIES AND EQUITY
Current liabilities:
Cash overdraft	$	24,877		$	28,919
Accounts payable		137,297			121,030
Current maturities of long-term debt		22,172			24,585
Insurance claims		40,215			41,627
Other current liabilities		53,785			42,474
Total current liabilities		278,346			258,635
Long-term debt, excluding current maturities		99,439			68,313
Insurance claims		31,468			30,680
Deferred income taxes		23,662			23,013
Equity
Landstar System, Inc. and subsidiary shareholders’ equity Common stock, $0.01 par value, authorized 160,000,000 shares, issued 66,535,169 and 66,255,358 shares		665			663
Additional paid-in capital		169,268			161,261
Retained earnings		844,132			766,040
Cost of 18,674,902 and 16,022,111 shares of common stock in treasury		(763,182	)		(660,446	)
Accumulated other comprehensive income		881			498
Total Landstar System, Inc. and subsidiary shareholders’ equity		251,764			268,016
Noncontrolling interest		(797	)		135
Total equity		250,967			268,151
Total liabilities and equity	$	683,882		$	648,792

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Landstar System, Inc. and Subsidiary
Supplemental Information
(Unaudited)

	Fiscal Year Ended				Thirteen Weeks Ended
	December 25,		December 26,		December 25,		December 26,
	2010		2009		2010		2009
Revenue generated through (in thousands):
Business Capacity Owners(1)	$	1,289,395	$	1,140,004	$	323,174	$	299,613
Truck Brokerage Carriers		919,605		694,467		214,416		198,806
Rail intermodal		70,299		76,346		18,459		19,252
Ocean cargo carriers		46,064		33,835		12,019		8,376
Air cargo carriers		20,104		17,621		6,251		7,362
Other(2)		54,703		46,523		13,216		14,306
	$	2,400,170	$	2,008,796	$	587,535	$	547,715
Number of loads:
Business Capacity Owners(1)		821,330		761,940		197,060		200,100
Truck Brokerage Carriers		591,810		501,980		135,400		138,980
Rail intermodal		31,070		37,890		7,950		9,290
Ocean cargo carriers		6,830		5,370		1,900		1,450
Air cargo carriers		6,880		7,780		2,010		1,340
		1,457,920		1,314,960		344,320		351,160
Revenue per load:
Business Capacity Owners(1)	$	1,570	$	1,496	$	1,640	$	1,497
Truck Brokerage Carriers		1,554		1,383		1,584		1,430
Rail intermodal		2,263		2,015		2,322		2,072
Ocean cargo carriers		6,744		6,301		6,326		5,777
Air cargo carriers		2,922		2,265		3,110		5,494

	December 25,		December 26,
	2010		2009
Truck Capacity
Business Capacity Owners(1) (3)		7,865		7,926
Truck Brokerage Carriers:
Approved and active(4)		18,049		14,887
Approved		9,938		9,886
		27,987		24,773
Total available truck capacity providers		35,852		32,699
Million Dollar Agents(5)		468		405

(1)	Business Capacity Owners are independent contractors who provide truck capacity to the Company under exclusive lease arrangements.
(2)	Includes premium revenue generated by the insurance segment and warehousing and transportation management fee revenue generated by the transportation logistics segment.
(3)	Trucks provided by Business Capacity Owners were 8,452 and 8,519 at December 25, 2010 and December 26, 2009, respectively.
(4)	Active refers to Truck Brokerage Carriers who have moved at least one load in the past 180 days.
(5)	Independent commission sales agents who on an annual basis generate $1 million or more of Landstar revenue.