Landstar System (LSTR) 8-K Landstar System Reports 45 Percent Increase In Diluted Earnings

Exhibit 99.1

For Immediate Release	Contact: Jim Gattoni
	Landstar System, Inc.
	www.landstar.com
October 24, 2011	904-398-9400

LANDSTAR SYSTEM REPORTS 45 PERCENT INCREASE IN DILUTED EARNINGS

PER SHARE TO A THIRD QUARTER RECORD OF $0.64

Jacksonville, FL – Landstar System, Inc. (NASDAQ: LSTR) reported 2011 record third quarter diluted earnings per share of $0.64 per diluted share, from net income of $30.2 million, compared to net income of $21.8 million, or $0.44 per diluted share, for the 2010 third quarter. Operating margin was 44.7 percent in the 2011 third quarter compared to 35.6 percent in the 2010 third quarter. Revenue for the 2011 third quarter was $684.0 million compared to $622.8 million in the 2010 third quarter. Included in the 2010 third quarter was a one-time charge of $3.8 million, or $0.05 per diluted share, related to the buy-out by the Company of its remaining contingent payment obligation from an acquisition completed in 2009.

Truck transportation revenue hauled by independent business capacity owners (“BCOs”) and truck brokerage carriers in the 2011 third quarter was $625.8 million, or 91 percent of revenue, compared to $573.5 million, or 92 percent of revenue, in the 2010 third quarter. In the 2011 and 2010 third quarters, the Company invoiced customers $72.7 million and $48.5 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 third quarters were $25.9 million and $20.3 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 $17.1 million and $48.4 million in the 2011 and 2010 third quarters, respectively. Revenue hauled by rail, air and ocean cargo carriers was $44.5 million, or 7 percent of revenue, in the 2011 third

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quarter compared to $36.2 million, or 6 percent of revenue, in the 2010 third quarter. Transportation management fee revenue generated by the supply chain solutions companies was $5.0 million and $4.3 million in the 2011 and 2010 third quarters, respectively.

Trailing twelve-month return on average shareholder’s equity was 39 percent and trailing twelve-month return on invested capital, net income divided by the sum of average equity plus average debt, was 27 percent. During the 2011 third quarter, the Company purchased 816,814 shares of its common stock under its authorized share purchase programs. In the thirty-nine week period ended September 24, 2011, the Company purchased a total of 1,013,507 shares of its common stock at a total cost of $41,966,000. Under the Company’s authorized share purchase program, the Company currently has a total of 709,000 shares of its common stock available for purchase. Landstar System, Inc. also announced that its Board of Directors has declared a quarterly dividend of $0.055 per share. The dividend is payable on December 2, 2011 to stockholders of record at the close of business on November 8, 2011. It is the intention of the Board of Directors to continue to pay a quarterly dividend.

“I am extremely pleased with the Company’s 2011 third quarter operating performance,” said Henry Gerkens, Landstar’s Chairman, President and CEO. “Revenue increased ten percent over the 2010 third quarter, even after taking into account the anticipated revenue decline in our substitute line haul service offering. Excluding the substitute line haul revenue from both the 2011 and 2010 third quarters, revenue increased 16 percent. During the 2011 third quarter, the growth rate in the number of loads hauled increased each month compared to the corresponding prior year month as we moved through the quarter. Revenue per load continued to be strong. Consolidated operating income increased 38 percent, while earnings per diluted share increased 45 percent to $0.64 per diluted share, the best third quarter diluted earnings per share in Landstar history.”

Gerkens continued, “Although I am very confident as Landstar enters the 2011 fourth quarter, the Company’s fourth quarter revenue performance in recent years has been somewhat inconsistent, especially in the latter part of the quarter. However, recent trends in September, and thus far in October, indicate continued strength in revenue per

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load and load volume. Assuming these trends continue throughout the 2011 fourth quarter, I would expect 2011 fourth quarter diluted earnings per share to be within a range of $0.62 to $0.67.”

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 Third Quarter 2011 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 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.

About Landstar:

Landstar System, Inc. is a non-asset based provider of integrated supply chain solutions. Landstar delivers safe, specialized transportation 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

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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)

	Thirty Nine Weeks Ended						Thirteen Weeks Ended
	September 24, 2011			September 25, 2010			September 24, 2011		September 25, 2010
Revenue	$	1,931,560		$	1,812,635		$	684,013	$	622,826
Investment income		1,294			1,069			373		495
Costs and expenses:
Purchased transportation		1,459,660			1,381,955			518,300		474,665
Commissions to agents		153,165			134,695			54,990		47,316
Other operating costs		22,050			21,952			6,427		6,448
Insurance and claims		34,096			37,609			9,381		11,480
Selling, general and administrative (1)		112,252			114,886			39,206		41,070
Depreciation and amortization		19,336			18,444			6,549		6,456
Total costs and expenses (1)		1,800,559			1,709,541			634,853		587,435
Operating income (1)		132,295			104,163			49,533		35,886
Interest and debt expense		2,340			2,699			735		1,035
Income before income taxes (1)		129,955			101,464			48,798		34,851
Income taxes		49,642			38,761			18,640		13,315
Net income (1)		80,313			62,703			30,158		21,536
Less: Net loss attributable to noncontrolling interest		(62	)		(712	)		—		(266	)
Net income attributable to Landstar System, Inc. and subsidiary (1)	$	80,375		$	63,415		$	30,158	$	21,802
Earnings per common share attributable to Landstar System, Inc. and subsidiary (1)	$	1.69		$	1.27		$	0.64	$	0.44
Diluted earnings per share attributable to Landstar System, Inc. and subsidiary (1)	$	1.68		$	1.27		$	0.64	$	0.44
Average number of shares outstanding:
Earnings per common share		47,670,000			49,921,000			47,358,000		49,434,000
Diluted earnings per share		47,735,000			49,990,000			47,387,000		49,447,000
Dividends paid per common share	$	0.155		$	0.1400		$	0.055	$	0.0500

(1) The 2010 thirty-nine and thirteen-week periods include a $3,800 one-time charge for the buyout by the Company of its remaining contingent payment obligation from an acquisition completed in 2009. Net of related income tax benefits, these costs reduced net income for the thirty-nine and thirteen-week periods ended September 25, 2010 by $2,348, or $0.05 per common share ($0.05 per diluted share).

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Landstar System, Inc. and Subsidiary

Consolidated Balance Sheets

(Dollars in thousands, except per share amounts)

(Unaudited)

	Sept. 24, 2011			Dec. 25, 2010
ASSETS
Current assets:
Cash and cash equivalents	$	69,409		$	44,706
Short-term investments		28,177			23,266
Trade accounts receivable, less allowance of $4,652 and $5,324		388,235			307,350
Other receivables, including advances to independent contractors, less allowance of $5,018 and $5,511		53,515			23,943
Deferred income taxes and other current assets		19,073			21,652
Total current assets		558,409			420,917
Operating property, less accumulated depreciation and amortization of $147,237 and $137,830		128,388			132,649
Goodwill		57,470			57,470
Other assets		59,090			72,846
Total assets	$	803,357		$	683,882
LIABILITIES AND EQUITY
Current liabilities:
Cash overdraft	$	23,061		$	24,877
Accounts payable		180,488			137,297
Current maturities of long-term debt		16,548			22,172
Insurance claims		75,511			40,215
Other current liabilities		68,268			53,785
Total current liabilities		363,876			278,346
Long-term debt, excluding current maturities		110,526			99,439
Insurance claims		30,336			31,468
Deferred income taxes		20,078			23,662
Equity
Landstar System, Inc. and subsidiary shareholders’ equity
Common stock, $0.01 par value, authorized 160,000,000 shares, issued 66,595,036 and 66,535,169 shares		666			665
Additional paid-in capital		164,766			169,268
Retained earnings		917,100			844,132
Cost of 19,689,466 and 18,674,902 shares of common stock in treasury		(805,189	)		(763,182	)
Accumulated other comprehensive income		1,198			881
Total Landstar System, Inc. and subsidiary shareholders’ equity		278,541			251,764
Noncontrolling interest		—			(797	)
Total equity		278,541			250,967
Total liabilities and equity	$	803,357		$	683,882

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Landstar System, Inc. and Subsidiary

Supplemental Information

(Unaudited)

	Thirty Nine Weeks Ended					Thirteen Weeks Ended
	September 24, 2011		September 25, 2010			September 24, 2011		September 25, 2010
Revenue generated through (in thousands):
Business Capacity Owners(1)	$	1,020,856	$	966,221		$	351,108	$	334,485
Truck Brokerage Carriers		747,122		705,189			274,731		239,026
Rail intermodal		53,991		51,840			19,159		17,748
Ocean cargo carriers		38,733		34,045	��		12,702		13,210
Air cargo carriers		29,528		13,853			12,628		5,291
Other(2)		41,330		41,487			13,685		13,066
	$	1,931,560	$	1,812,635		$	684,013	$	622,826
Number of loads:
Business Capacity Owners(1)		601,990		624,270			199,260		203,500
Truck Brokerage Carriers		441,930		456,410			154,720		148,080
Rail intermodal		22,750		23,120			7,920		7,630
Ocean cargo carriers		6,040		4,930			2,090		1,820
Air cargo carriers		6,110		4,870			2,110		1,740
		1,078,820		1,113,600			366,100		362,770
Revenue per load:
Business Capacity Owners(1)	$	1,696	$	1,548		$	1,762	$	1,644
Truck Brokerage Carriers		1,691		1,545			1,776		1,614
Rail intermodal		2,373		2,242			2,419		2,326
Ocean cargo carriers		6,413		6,906			6,078		7,258
Air cargo carriers		4,833		2,845			5,985		3,041
						September 24, 2011		September 25, 2010
Truck Capacity Providers
Business Capacity Owners(1) (3)							7,798		7,893
Truck Brokerage Carriers:
Approved and active(4)							18,402		17,393
Approved							9,088		9,490
							27,490		26,883
Total available truck capacity providers							35,288		34,776

(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 8,314 and 8,481 at September 24, 2011 and September 25, 2010, respectively.

(4) Active refers to Truck Brokerage Carriers who have moved at least one load in the past 180 days.