Landstar System (LSTR) 8-K Landstar System Reports 27 Percent Increase In Diluted Earnings Per Share to a Second Quarter Record of $0.62

Exhibit 99.1

For Immediate Release	Contact: Jim Gattoni
	Landstar System, Inc.
	www.landstar.com
July 21, 2011	904-398-9400

LANDSTAR SYSTEM REPORTS 27 PERCENT INCREASE IN DILUTED EARNINGS
PER SHARE TO A SECOND QUARTER RECORD OF $0.62

Jacksonville, FL — Landstar System, Inc. (NASDAQ: LSTR) reported 2011 record second quarter diluted earnings per share of $0.62 per diluted share, from net income of $29.6 million, compared to net income of $24.4 million, or $0.49 per diluted share, for the 2010 second quarter. Operating margin was 43.6 percent in the 2011 second quarter compared to 38.2 percent in the 2010 second quarter. Revenue for the 2011 second quarter was $675.6 million compared to $641.7 million in the 2010 second quarter.

Truck transportation revenue hauled by independent business capacity owners (“BCOs”) and truck brokerage carriers in the 2011 second quarter was $621.5 million, or 92 percent of revenue, compared to $592.0 million, or 92 percent of revenue, in the 2010 second quarter. In the 2011 and 2010 second quarters, the Company invoiced customers $78.7 million and $53.1 million, respectively, of fuel surcharges that were passed 100 percent to BCOs and excluded from revenue. Included in revenue hauled by third-party truck capacity providers in the 2011 and 2010 second quarters were $25.9 million and $23.1 million, respectively, of fuel surcharges invoiced to customers on revenue hauled by third-party truck brokerage carriers. Also included in revenue hauled by third-party truck capacity providers was revenue generated under the Company’s less-than-truckload substitute line haul service offering of $18.8 million and $70.5 million in the 2011 and 2010 second quarters, respectively. Revenue hauled by rail, air and ocean cargo carriers was $39.9 million, or 6 percent of revenue, in the 2011 second quarter compared to $35.0 million, or 5 percent of revenue, in the 2010 second quarter. Transportation management fee revenue generated by the supply chain solutions companies was $5.6 million and $4.9 million in the 2011 and 2010 second quarters, respectively.

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Trailing twelve-month return on average shareholder’s equity was 35 percent and trailing twelve-month return on invested capital, net income divided by the sum of average equity plus average debt, was 25 percent. Landstar System, Inc. also announced that its Board of Directors has declared a quarterly dividend of $0.055 per share. This represents a 10 percent increase in the Company’s quarterly dividend. The dividend is payable on August 26, 2011 to stockholders of record at the close of business on August 8, 2011. It is the intention of the Board of Directors to continue to pay a quarterly dividend. During the 2011 second quarter, Landstar purchased 196,693 shares of its common stock at a total cost of $9.3 million. Under the Company’s authorized share purchase program, the Company currently has a total of 526,000 shares of its common stock available for purchase.

“I am extremely pleased with the Company’s 2011 second quarter operating performance,” said Henry Gerkens, Landstar’s Chairman, President and CEO. “Despite the anticipated revenue decline in our substitute line haul service offering, revenue increased five percent over the 2010 second quarter. Excluding the substitute line haul revenue from both the 2011 and 2010 second quarters, revenue increased 15 percent. I would characterize the overall second quarter freight environment as a little choppy, but moving in an upward direction. Pricing continued to be strong. Consolidated operating income increased 22 percent, while earnings per diluted share increased 27 percent to $0.62 per diluted share, the best second quarter diluted earnings per share in Landstar history.”

Gerkens continued, “Recent trends in June, and thus far in July, indicate continued strength in revenue per load with a relatively stable increase in the number of loads hauled month over prior year month. I expect these trends to continue throughout the 2011 third quarter. In addition, excluding disaster relief service revenue, revenue generated in the Company’s third quarter has historically been very similar to revenue generated in the Company’s second quarter. As such, I would expect revenue, gross profit, operating income and diluted earnings per share to be similar to those experienced during the 2011 second quarter.”

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 Second Quarter 2011 Earnings Release Conference Call.”

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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 2010 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)

	Twenty Six Weeks Ended						Thirteen Weeks Ended
	June 25,			June 26,			June 25,		June 26,
	2011			2010			2011		2010
Revenue	$	1,247,547		$	1,189,809		$	675,561	$	641,721
Investment income		921			574			393		289
Costs and expenses:
Purchased transportation		941,360			907,290			509,982		490,089
Commissions to agents		98,175			87,379			54,004		46,971
Other operating costs		15,623			15,504			7,679		7,968
Insurance and claims		24,715			26,129			13,449		13,831
Selling, general and administrative		73,046			73,816			35,782		36,973
Depreciation and amortization		12,787			11,988			6,388		6,196
Total costs and expenses		1,165,706			1,122,106			627,284		602,028
Operating income		82,762			68,277			48,670		39,982
Interest and debt expense		1,605			1,664			777		810
Income before income taxes		81,157			66,613			47,893		39,172
Income taxes		31,002			25,446			18,295		14,962
Net income		50,155			41,167			29,598		24,210
Less: Net loss attributable to noncontrolling interest		(62	)		(446	)		—		(227	)
Net income attributable to Landstar System, Inc. and subsidiary	$	50,217		$	41,613		$	29,598	$	24,437
Earnings per common share attributable to Landstar System, Inc. and subsidiary	$	1.05		$	0.83		$	0.62	$	0.49
Diluted earnings per share attributable to Landstar System, Inc. and subsidiary	$	1.05		$	0.83		$	0.62	$	0.49
Average number of shares outstanding:
Earnings per common share		47,826,000			50,165,000			47,782,000		50,123,000
Diluted earnings per share		47,907,000			50,259,000			47,912,000		50,215,000
Dividends paid per common share	$	0.100		$	0.090		$	0.050	$	0.045

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

	June 25,			Dec. 25,
	2011			2010
ASSETS
Current assets:
Cash and cash equivalents	$	39,544		$	44,706
Short-term investments		30,489			23,266
Trade accounts receivable, less allowance of $4,155 and $5,324		385,540			307,350
Other receivables, including advances to independent contractors, less allowance of $4,987 and $5,511		25,493			23,943
Deferred income taxes and other current assets		21,008			21,652
Total current assets		502,074			420,917
Operating property, less accumulated depreciation and amortization of $146,476 and $137,830		123,895			132,649
Goodwill		57,470			57,470
Other assets		60,873			72,846
Total assets	$	744,312		$	683,882
LIABILITIES AND EQUITY
Current liabilities:
Cash overdraft	$	26,347		$	24,877
Accounts payable		175,325			137,297
Current maturities of long-term debt		17,260			22,172
Insurance claims		44,442			40,215
Other current liabilities		53,077			53,785
Total current liabilities		316,451			278,346
Long-term debt, excluding current maturities		93,894			99,439
Insurance claims		31,273			31,468
Deferred income taxes		20,214			23,662
Equity
Landstar System, Inc. and subsidiary shareholders’ equity Common stock, $0.01 par value, authorized 160,000,000 shares, issued 66,589,780 and 66,535,169 shares		666			665
Additional paid-in capital		163,355			169,268
Retained earnings		889,561			844,132
Cost of 18,872,652 and 18,674,902 shares of common stock in treasury		(772,489	)		(763,182	)
Accumulated other comprehensive income		1,387			881
Total Landstar System, Inc. and subsidiary shareholders’ equity		282,480			251,764
Noncontrolling interest		—			(797	)
Total equity		282,480			250,967
Total liabilities and equity	$	744,312		$	683,882

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

	Twenty Six Weeks Ended				Thirteen Weeks Ended
	June 25,		June 26,		June 25,		June 26,
	2011		2010		2011		2010
Revenue generated through (in thousands):
Business Capacity Owners(1)	$	669,748	$	631,736	$	362,854	$	345,595
Truck Brokerage Carriers		472,391		466,163		258,668		246,408
Rail intermodal		34,832		34,092		18,367		19,316
Ocean cargo carriers		26,031		20,835		12,198		11,700
Air cargo carriers		16,900		8,562		9,340		3,959
Other(2)		27,645		28,421		14,134		14,743
	$	1,247,547	$	1,189,809	$	675,561	$	641,721
Number of loads:
Business Capacity Owners(1)		402,730		420,770		210,690		223,020
Truck Brokerage Carriers		287,210		308,330		151,470		158,980
Rail intermodal		14,830		15,490		7,570		8,620
Ocean cargo carriers		3,950		3,110		2,120		1,650
Air cargo carriers		4,000		3,130		2,050		1,630
		712,720		750,830		373,900		393,900
Revenue per load:
Business Capacity Owners(1)	$	1,663	$	1,501	$	1,722	$	1,550
Truck Brokerage Carriers		1,645		1,512		1,708		1,550
Rail intermodal		2,349		2,201		2,426		2,241
Ocean cargo carriers		6,590		6,699		5,754		7,091
Air cargo carriers		4,225		2,735		4,556		2,429

	June 25,		June 26,
	2011		2010
Truck Capacity
Business Capacity Owners(1) (3)		7,711		7,818
Truck Brokerage Carriers:
Approved and active(4)		17,696		16,670
Approved		8,984		9,047
		26,680		25,717
Total available truck capacity providers		34,391		33,535

(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 8,231 and 8,399 at June 25, 2011 and June 26, 2010, respectively.
(4)	Active refers to Truck Brokerage Carriers who have moved at least one load in the past 180 days.