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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2001
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
Commission File No. 1-4364
_____________________________________
RYDER SYSTEM, INC.
(a Florida corporation)
3600 N.W. 82nd Avenue
Miami, Florida 33166
Telephone (305) 500-3726
I.R.S. Employer Identification No. 59-0739250
_____________________________________
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for
the past 90 days: YES X NO
--- ---
Ryder System, Inc. had 60,337,162 shares of common stock ($0.50 par value per
share) outstanding as of April 30, 2001.
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RYDER SYSTEM, INC.
TABLE OF CONTENTS
Page
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PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Consolidated Condensed Statements of Earnings - Three months
ended March 31, 2001 and 2000 (unaudited) 3
Consolidated Condensed Balance Sheets -
March 31, 2001 (unaudited) and December 31, 2000 4
Consolidated Condensed Statements of Cash Flows -
Three months ended March 31, 2001 and 2000 (unaudited) 5
Notes to Consolidated Condensed Financial Statements (unaudited) 6
Independent Accountants' Review Report 12
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition 13
ITEM 3. Quantitative and Qualitative Disclosure About Market Risk 24
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K 25
Signatures 26
Exhibit Index 27
2
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Ryder System, Inc. and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (unaudited)
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Three months ended March 31, 2001 and 2000
(In thousands, except per share amounts)
2001 2000
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Revenue $ 1,281,509 1,308,608
------------- -------------
Operating expense 885,736 908,812
Freight under management expense 102,167 98,007
Depreciation expense 137,550 152,221
Gains on vehicle sales (3,107) (9,217)
Equipment rental 103,639 86,847
Interest expense 34,321 41,952
Miscellaneous expense (income), net 4,121 (1,481)
Restructuring and other charges, net 10,544 -
------------- -------------
1,274,971 1,277,141
------------- -------------
Earnings before income taxes 6,538 31,467
Provision for income taxes 2,419 11,643
------------- -------------
Net earnings $ 4,119 19,824
============= =============
Earnings per common share:
Basic $ 0.07 0.33
============= =============
Diluted $ 0.07 0.33
============= =============
Cash dividends per common share $ 0.15 0.15
============= =============
See accompanying notes to consolidated condensed financial statements.
3
ITEM 1. Financial Statements (continued)
Ryder System, Inc. and Subsidiaries
CONSOLIDATED CONDENSED BALANCE SHEETS
(unaudited)
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March 31, December 31,
(In thousands, except share amounts) 2001 2000
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Assets
Current assets:
Cash and cash equivalents $ 87,422 121,970
Receivables, net of allowance for doubtful accounts of $7,754
and $9,236, respectively 445,939 399,623
Inventories 75,495 77,810
Tires in service 137,964 158,854
Prepaid expenses and other current assets 166,321 170,019
------------------- ----------------
Total current assets 913,141 928,276
Revenue earning equipment, net of accumulated depreciation of
$1,399,473 and $1,416,062, respectively 2,613,398 3,012,806
Operating property and equipment, net of accumulated depreciation
of $639,173 and $632,216, respectively 606,276 612,626
Direct financing leases and other assets 718,680 693,097
Intangible assets and deferred charges 223,337 228,118
------------------- ----------------
$ 5,074,832 5,474,923
=================== ================
Liabilities and Shareholders' Equity
Current liabilities:
Current portion of long-term debt $ 284,597 412,738
Accounts payable 325,660 379,155
Accrued expenses 441,150 510,411
------------------- ----------------
Total current liabilities 1,051,407 1,302,304
Long-term debt 1,478,802 1,604,242
Other non-current liabilities 300,653 298,365
Deferred income taxes 1,008,160 1,017,304
------------------- ----------------
Total liabilities 3,839,022 4,222,215
------------------- ----------------
Shareholders' equity:
Preferred stock of no par value per share - Authorized 900,000;
none outstanding March 31, 2001 or December 31, 2000 - -
Common stock of $0.50 par value per share - Authorized 400,000,000;
Outstanding, March 31, 2001 - 60,176,276; December 31, 2000 - 60,044,479 529,516 524,432
Retained earnings 762,913 767,802
Deferred compensation (6,665) (3,818)
Accumulated other comprehensive loss (49,954) (35,708)
------------------- ----------------
Total shareholders' equity 1,235,810 1,252,708
------------------- ----------------
$ 5,074,832 5,474,923
=================== ================
See accompanying notes to consolidated condensed financial statements.
4
ITEM 1. Financial Statements (continued)
Ryder System, Inc. and Subsidiaries
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (unaudited)
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Three months ended March 31, 2001 and 2000
(In thousands) 2001 2000
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Cash flows from operating activities:
Net earnings $ 4,119 19,824
Depreciation expense 137,550 152,221
Gains on vehicle sales (3,107) (9,217)
Amortization expense and other non-cash charges, net 9,836 4,710
Deferred income tax expense 2,058 10,022
Changes in operating assets and liabilities, net of acquisitions:
Increase (decrease) in aggregate balance of trade receivables sold (95,000) 234,000
Receivables 54,067 38,346
Inventories 2,315 (2,005)
Prepaid expenses and other assets (7,333) (58,367)
Accounts payable (53,521) 81,640
Accrued expenses and other non-current liabilities (75,935) (35,723)
----------------- ----------------
(24,951) 435,451
----------------- ----------------
Cash flows from financing activities:
Net change in commercial paper borrowings (218,022) 150,082
Debt proceeds 92,769 5,969
Debt repaid, including capital lease obligations (109,724) (193,445)
Dividends on common stock (9,008) (8,910)
Common stock issued 1,780 1,609
----------------- ----------------
(242,205) (44,695)
----------------- ----------------
Cash flows from investing activities:
Purchases of property and revenue earning equipment (250,203) (497,267)
Sales of property and revenue earning equipment 44,545 78,114
Sale and leaseback of revenue earning equipment 410,739 222,978
Acquisitions, net of cash acquired - (3,551)
Proceeds from sale of business 14,113 -
Collections on direct finance leases 15,740 16,163
Other, net (2,326) (6,799)
----------------- ----------------
232,608 (190,362)
----------------- ----------------
Increase (decrease) in cash and cash equivalents (34,548) 200,394
Cash and cash equivalents at January 1 121,970 112,993
----------------- ----------------
Cash and cash equivalents at March 31 $ 87,422 313,387
================= ================
See accompanying notes to consolidated condensed financial statements.
5
ITEM 1. Financial Statements (continued)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
(A) INTERIM FINANCIAL STATEMENTS
The accompanying unaudited consolidated condensed financial statements
include the accounts of Ryder System, Inc. and subsidiaries (the
"Company") and have been prepared by the Company in accordance with the
accounting policies described in the 2000 Annual Report and should be
read in conjunction with the consolidated financial statements and
notes which appear in that report. These statements do not include all
of the information and footnotes required by accounting principles
generally accepted in the United States of America for complete
financial statements. In the opinion of management, all adjustments
(primarily consisting of normal recurring accruals) considered
necessary for a fair presentation have been included and the
disclosures herein are adequate to make the information presented not
misleading. Operating results for interim periods are not necessarily
indicative of the results that can be expected for a full year. Certain
prior year amounts have been reclassified to conform with current
presentation.
(B) EARNINGS PER SHARE INFORMATION
Basic earnings per share is computed by dividing net earnings by the
weighted average number of common shares outstanding. Diluted earnings
per share reflects the dilutive effect of potential common shares from
securities such as stock options and unvested restricted stock. The
dilutive effect of stock options is computed using the treasury stock
method, which assumes the repurchase of common shares by the Company at
the average market price for the period. A reconciliation of the number
of shares used in computing basic and diluted earnings per share
follows:
Three months ended March 31, 2001 and 2000
(In thousands) 2001 2000
----------------------------------------------------- ------ ------
Weighted average shares outstanding-Basic 59,877 59,381
Effect of dilutive options and unvested restricted stock 459 187
Weighted average shares outstanding-Diluted 60,336 59,568
====== ======
Anti-dilutive options not included above 7,127 6,178
====== ======
Key employee plans provide for the issuance of stock appreciation
rights, limited stock appreciation rights, performance units or
restricted stock at no cost to the employee. The value of the
restricted stock, equal to fair market value at the time of grant, is
recorded in shareholders' equity as deferred compensation and
recognized as compensation expense as the restricted stock and stock
units vest over the periods established for each grant. In the first
quarter of 2001, the Company granted 165,755 shares of restricted stock
at a weighted average grant date fair value of $20.62. No grants were
made in the first quarter of 2000.
(C) SEGMENT INFORMATION
The Company's operating segments are aggregated into the following
reportable business segments based primarily upon similar economic
characteristics, products, services and delivery methods. The Company
operates in four reportable business segments: (1) Fleet Management
Solutions (FMS), which provides full service leasing, commercial rental
and programmed maintenance of trucks, tractors and trailers to
customers, principally in the U.S., Canada and the United Kingdom; (2)
Supply Chain Solutions (SCS), which provides comprehensive supply chain
consulting and lead logistics management solutions that support
6
ITEM 1. Financial Statements (continued)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued)
(C) SEGMENT INFORMATION (continued)
customers' entire supply chains, from inbound raw materials through
distribution of finished goods throughout North America, in Latin
America, Europe and Asia; (3) Dedicated Contract Carriage (DCC), which
provides vehicles and drivers as part of a dedicated transportation
solution, principally in North America; and (4) e-Commerce which
provides various Internet-enabled products and online services to
assist in the management of freight, inventory and customer delivery,
principally in North America.
Beginning in the first quarter of 2001, e-Commerce is reported as a
separate business segment. Initial costs to build the e-Commerce
platform were included in Central Support Services (CSS) through 2000.
At March 31, 2001, such costs have been reclassified from CSS for all
previous periods in order to report e-Commerce results independently.
Management evaluates business segment financial performance based upon
several factors, of which the primary measure is contribution margin.
Contribution margin represents each business segment's revenue, less
direct costs and direct overheads related to the segment's operations.
Business segment contribution margin for all segments (net of
eliminations), less CSS expenses and restructuring and other charges,
net, is equal to earnings before income taxes. CSS are those costs
incurred to support all business segments, including sales and
marketing, human resources, finance, shared management information
systems, customer solutions, health and safety, legal and
communications.
The FMS segment leases revenue earning equipment, sells fuel and
provides maintenance and other ancillary services to the SCS and DCC
segments. Inter-segment revenues and contribution margin are accounted
for at approximate fair value as if the transactions were made to third
parties. Contribution margin related to inter-segment equipment and
services billed to customers (equipment contribution) is included in
both FMS and the business segment which served the customer, then
eliminated. Equipment contribution included in SCS contribution margin
was $4.2 million and $5.1 million for the three months ended March 31,
2001 and 2000, respectively. Equipment contribution included in DCC
contribution margin was $4.6 million and $5.3 million for the three
months ended March 31, 2001 and 2000, respectively. Interest expense is
primarily allocated to the FMS business segment.
The following table sets forth the revenue and contribution margin for
each of the Company's business segments for the three months ended
March 31, 2001 and 2000. These results are not necessarily indicative
of the results of operations that would have occurred had each segment
been an independent, stand-alone entity during the periods presented.
Three months ended March 31, 2001 and 2000
(In millions) 2001 2000
----------------------------------------------- --------- ---------
Revenue:
Fleet management solutions:
Full service lease and program maintenance $ 465.1 460.1
Commercial rental 109.3 121.2
Fuel 182.4 196.6
Other 97.4 104.0
--------- ---------
Total Fleet management solutions 854.2 881.9
--------- ---------
Supply chain solutions 385.3 386.6
Dedicated contract carriage 130.6 133.6
e-Commerce 1.1 -
Eliminations (89.7) (93.5)
--------- ---------
Total revenue $ 1,281.5 1,308.6
========= =========
ITEM 1. Financial Statements (continued)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued)
(C) SEGMENT INFORMATION (continued)
Three months ended March 31, 2001 and 2000
(In millions) 2001 2000
------------------------------------------------- --------- ---------
Contribution margin:
Fleet management solutions $ 75.6 80.8
Supply chain solutions 7.6 14.6
Dedicated contract carriage 11.2 14.0
e-Commerce (2.6) (0.5)
Eliminations (8.8) (10.4)
--------- ---------
83.0 98.5
Central support services (66.0) (67.0)
--------- ---------
Earnings before restructuring and other
charges and income taxes 17.0 31.5
Restructuring and other charges, net (10.5) -
--------- ---------
Earnings before income taxes $ 6.5 31.5
========= =========
Asset information, including capital expenditures, is not maintained on
a business segment basis nor provided to the chief operating
decision-maker, and as such is not presented.
(D) COMPREHENSIVE LOSS
Comprehensive loss presents a measure of all changes in shareholders'
equity except for changes resulting from transactions with shareholders
in their capacity as shareholders. The Company's total comprehensive
loss consists of net earnings, currency translation adjustments
associated with foreign operations which use the local currency as
their functional currency and recognition of an additional minimum
pension liability. The additional minimum pension liability of
$3.1 million at March 31, 2001 relates to the Company's Benefit
Restoration Plan and represents the amount by which the plan's
accumulated benefit obligation exceeds the unfunded accrued pension
expense liability. Such additional minimum pension liability is offset
by an intangible asset of $1.9 million equal to the Plan's unrecognized
prior service cost and a reduction to comprehensive income of $1.2
million. No minimum pension liability adjustment was required for the
quarter ended March 31, 2000. Currency translation adjustments for the
three months ended March 31, 2001 and 2000 were $(13.0) million and
$(2.3) million, respectively. Total comprehensive (loss) income for the
three months ended March 31, 2001 and 2000 was $(10.1) million and
$17.5 million, respectively.
8
ITEM 1. Financial Statements (continued)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued)
(E) RESTRUCTURING AND OTHER CHARGES
During the first quarter of 2001, the Company recorded restructuring
and other charges of approximately $10.5 million. The components of the
charges were as follows (in thousands):
Severance and employee-related costs $ 6,637
Loss on the sale of business 3,270
Strategic consulting fees 2,836
Other charges (recoveries) (2,199)
---------
Total $ 10,544
=========
In the fourth quarter of 2000, the Company communicated to its
employees its planned strategic initiatives to reduce operating
expenses. As part of such initiatives, the Company is reviewing
employee functions and staffing levels to eliminate redundant work or
otherwise restructure work in a manner that will lead to a reduction in
the workforce. The process is expected to result in involuntary
terminations of approximately 700 employees during 2001. Formal
decisions on terminations are being made on a departmental basis.
Severance and employee-related costs represents the expense for
termination benefits for approximately 200 employees who were
terminated during the first quarter of 2001.
During the quarter ended March 31, 2001, the Company sold the contracts
and related assets and liabilities associated with the outbound auto
carriage portion of its Brazilian SCS operation. The Company incurred a
loss of approximately $3.3 million on the sale of such business.
Strategic consulting fees of approximately $2.8 million were incurred
during 2001 in relation to the aforementioned strategic initiatives.
Other charges (recoveries) represent a gain of approximately
$2.2 million recorded in the first quarter of 2001 on the sale of the
corporate aircraft.
Activity related to restructuring reserves for the three months ended
March 31, 2001 was as follows:
Dec. 31, March 31,
2000 2001
In thousands Balance Additions Deductions Balance
-------------------------------- -------- --------- ---------- ----------
Employee severance and benefits $ 3,908 6,637 2,881 7,664
Facilities and related costs 2,012 - 289 1,723
-------- --------- ---------- ----------
$ 5,920 6,637 3,170 9,387
======== ========= ========= ==========
Additions relate to 2001 restructuring employee severance benefits.
Deductions represent payments made related to restructuring charges.
At March 31, 2001, the remaining balances of restructuring reserves
relate to severance and lease obligations related to closed facilities.
Such obligations are contractually required to be paid over the next
three years.
9
ITEM 1. Financial Statements (continued)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued)
(F) DEBT AND OTHER FINANCING
The Company's outstanding debt balances were as follows:
March 31, December 31,
In millions 2001 2000
---------------------------------------------------------------------------------
U.S. commercial paper $ 254.0 441.1
Canadian commercial paper - 31.7
Unsecured U.S. notes:
Debentures 425.6 425.6
Medium-term notes 677.0 755.9
Unsecured foreign obligations 327.3 332.7
Other debt, including capital leases 79.5 30.0
---------------------------------------------------------------------------------
Total debt 1,763.4 2,017.0
Current portion (284.6) (412.8)
---------------------------------------------------------------------------------
Long-term debt $ 1,478.8 1,604.2
=================================================================================
During the first quarter of 2001, the Company replaced its
$720.0 million global revolving credit facility which was to expire in
June 2002 with a new $860.0 million global revolving credit facility.
The new facility is composed of $300.0 million which matures in
March 2002 and is renewable annually, and $560.0 million which matures
in March 2006. The primary purpose of the credit facility is to finance
working capital and provide support for the issuance of commercial
paper. At the Company's option, the interest rate on borrowings under
the credit facility is based on LIBOR, prime, federal funds or local
equivalent rates. The credit facility's annual facility fee ranges from
12.5 to 15.0 basis points applied to the total facility of
$860.0 million based on the Company's current credit ratings. At
March 31, 2001, $500.1 million was available under the Company's global
credit facility. Of such amount, $300.0 million was available at a
maturity of less than one year. Foreign borrowings of $99.6 million were
outstanding under the facility as of March 31, 2001.
In September 1998, the Company filed an $800.0 million shelf
registration statement with the Securities and Exchange Commission.
Proceeds from debt issues under the shelf registration have been and are
expected to be used for capital expenditures, debt refinancing and
general corporate purposes. At March 31, 2001, the Company had
$487.0 million of debt securities available for issuance under this
shelf registration statement. In April 2001, the Company issued an
additional $40.0 million of medium-term notes under the shelf
registration.
In the first quarter of 2001, the Company entered into a sale-leaseback
transaction in which the Company sold a beneficial interest in certain
revenue earning equipment and pledged a portion of the beneficial
interests in the underlying customer leases to a separately rated and
unconsolidated vehicle lease trusts (Ryder Vehicle Lease Trust 2001-A).
A total of $426.0 million in securities (including $409.0 of bonds that
are traded in public markets) were issued as supported by the future
cash flow stream generated by full service lease contracts and the
eventual disposition of the underlying leased vehicles. The related
vehicles total 9,700 full service lease units in 40 states.
10
ITEM 1. Financial Statements (continued)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued)
(G) OTHER MATTERS
The Company is also a party to various other claims, legal actions and
complaints arising in the ordinary course of business. While any
proceeding or litigation has an element of uncertainty, management
believes that the disposition of these matters will not have a material
impact on the consolidated financial position, liquidity or results of
operations of the Company.
At March 31, 2001, the Company had letters of credit outstanding
totaling $123.0 million, which primarily guarantee certain insurance
activities. Certain of these letters of credit guarantee insurance
activities associated with insurance claim liabilities transferred in
conjunction with the sale of certain businesses reported in
discontinued operations in previous years. To date, such insurance
claims, representing per claim deductibles payable under third-party
insurance policies, have been paid by the companies that assumed such
liabilities. However, if all or a portion of such assumed claims of
approximately $20.0 million are unable to be paid, the third-party
insurers may have recourse against certain letters of credit provided
by the Company in order to satisfy the unpaid claim deductibles.
11
KPMG LLP
CERTIFIED PUBLIC ACCOUNTANTS
One Biscayne Tower Telephone 305-358-2300
2 South Biscayne Boulevard Fax 305-913-2692
Suite 2900
Miami, Florida 33131
Independent Accountants' Review Report
--------------------------------------
The Board of Directors and Shareholders
Ryder System, Inc.:
We have reviewed the accompanying consolidated condensed balance sheet of Ryder
System, Inc. and subsidiaries as of March 31, 2001, and the related consolidated
condensed statements of earnings and cash flows for the three months ended March
31, 2001 and 2000. These consolidated condensed financial statements are the
responsibility of the Company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with auditing standards generally accepted in the United States of America, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the consolidated condensed financial statements referred to above in
order for them to be in conformity with accounting principles generally accepted
in the United States of America.
We have previously audited, in accordance with auditing standards generally
accepted in the United States of America, the consolidated balance sheet of
Ryder System, Inc. and subsidiaries as of December 31, 2000, and the related
consolidated statements of earnings, shareholders' equity and cash flows for the
year then ended (not presented herein); and in our report dated February 7,
2001, we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
consolidated condensed balance sheet as of December 31, 2000, is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived.
/S/ KPMG LLP
Miami, Florida
April 19, 2001
12
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition --
Three months ended March 31, 2001 and 2000
OVERVIEW
The following discussion should be read in conjunction with the unaudited
consolidated condensed financial statements and notes thereto included under
ITEM 1. In addition, reference should be made to the Company's audited
consolidated financial statements and notes thereto and related Management's
Discussion and Analysis of Financial Condition and Results of Operations
included in the Company's most recent Annual Report on Form 10-K.
The Company's operating segments are aggregated into the following reportable
business segments based primarily upon similar economic characteristics,
products, services and delivery methods. The Company operates in four reportable
business segments: (1) Fleet Management Solutions (FMS), which provides full
service leasing, commercial rental and programmed maintenance of trucks,
tractors and trailers to customers, principally in the U.S., Canada and the
United Kingdom; (2) Supply Chain Solutions (SCS), which provides comprehensive
supply chain consulting and lead logistics management solutions that support
customers' entire supply chains, from inbound raw materials through distribution
of finished goods throughout North America, in Latin America, Europe and Asia;
(3) Dedicated Contract Carriage (DCC), which provides vehicles and drivers as
part of a dedicated transportation solution, principally in North America; and
(4) e-Commerce which provides various Internet-enabled products and online
services to assist in the management of freight, inventory, and customer
delivery, principally in North America.
Beginning in the first quarter of 2001, e-Commerce is reported as a separate
business segment. Initial costs to build the e-Commerce platform were included
in Central Support Services (CSS) through 2000. At March 31, 2001, such costs
have been reclassified from CSS for all previous periods in order to report
e-Commerce results independently.
Revenue decreased 2.1 percent to $1.28 billion for the three months ended March
31, 2001 compared with $1.31 billion in the same period of 2000. The decrease
was due primarily to weak commercial rental results and lower fuel sales volumes
attributable to the continued economic slowdown in the U.S. Revenue was also
reduced by the impact of exchange rates on translation of foreign subsidiary
revenues, particularly those in the U.K., and by the sale of the contracts and
related net assets associated with the outbound auto carriage business of the
Company's Brazilian SCS operation (see further details in the restructuring and
other charges discussion of this Management's Discussion and Analysis). Such
decreases were partially offset by growth in lease and contract maintenance
revenue and an increase in North American SCS revenue, particularly in the
electronics and high technology operating unit.
Operating expense decreased $23.1 million, or 2.5 percent, to $885.7 million in
the first quarter of 2001 compared with the same period in 2000. The decrease
was a result of a reduction in overheads due to the Company implementing cost
containment actions throughout the first quarter of 2001 and a reduction in fuel
costs as a result of lower volumes. The decrease also reflects lower operating
expense in the U.K. due to lost business and in South America as a result of the
sale of the Company's outbound automotive transportation business in Brazil.
Such reductions were partially offset by a decrease in pension income in 2001
compared with 2000.
13
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OVERVIEW (continued)
Freight under management expense increased by $4.2 million, or 4.2 percent, to
$102.2 million in the first quarter of 2001 compared with the same period in
2000. The increase is due to revenue growth in related operating units of the
SCS business segment.
Depreciation expense in the first quarter of 2001 decreased by $14.7 million, or
9.6 percent, to $137.6 million compared with the first quarter of 2000. The
decrease resulted principally from sale-leaseback and other transactions which
increased the number of leased (as opposed to owned) vehicles in the Company's
fleet since the first quarter of 2000. The decrease in depreciation expense was
partially offset by an increase in depreciation associated with reduced
estimated residual values in 2001 associated with certain classes of tractors.
In the third quarter of 2000, the Company reduced residual values for certain
classes of vehicles currently in use and expected to be disposed of during the
next two years. This was done consistent with the charge recorded in the third
quarter of 2000 to reflect decreases in the estimate in residual values of
certain classes of used tractors. In light of this change, the Company expects
to record additional depreciation and rent expense over the next fifteen months
on a declining basis.
Gains on vehicle sales decreased $6.1 million, or 66.3 percent, to $3.1 million
in the first quarter of 2001 compared with the first quarter in 2000 due to the
continuing weak demand in the used truck market. Such weakness began to impact
the Company during the second quarter of 2000. During the first three months of
2001, average sales proceeds per unit decreased by approximately 11.0 percent
compared with the same period last year. However, average sales proceeds per
unit increased approximately 5.0 percent compared with the fourth quarter of
2000. The average book value per unit of units sold for the three months ended
March 31, 2001 was comparable with that of units sold in the same period of
2000.
The Company periodically reviews and adjusts the residual values, reserves for
guaranteed lease termination values and useful lives of revenue earning
equipment based on current and expected operating trends and projected
realizable values. The Company believes that its carrying values and estimated
sales proceeds for revenue earning equipment are appropriate. However, a greater
than anticipated decline in the market for used vehicles may require the Company
to further adjust such values and estimates.
Equipment rental primarily consists of rental costs on revenue earning
equipment. Equipment rental costs increased $16.8 million, or 19.3 percent, to
$103.6 million in the first quarter 2001 compared with 2000 as a result of sale-
leaseback transactions, including securitization transactions, completed in the
last six months.
Interest expense decreased $7.6 million, or 18.2 percent to $34.3 million during
the first quarter of 2001 compared with the same period in 2000. The decrease in
interest expense principally reflects debt reductions associated with the use of
proceeds from the aforementioned sale-leaseback transactions, generally lower
market interest rates and greater use of the Company's revolving facility for
the sale of trade receivables (in lieu of issuing commercial paper) compared
with the prior period.
Miscellaneous expense increased to $4.1 million in the first quarter of 2001
compared with miscellaneous income of $1.5 million in the first quarter of 2000.
The increase is due primarily to losses on investments classified as trading
securities used to fund certain benefit plans during the quarter ended March 31,
2001, compared with net gains on such investments in the quarter ended March 31,
2000. Such investments are included in Direct financing leases and other assets.
The increase was also attributed to higher administrative and usage fees related
to the increased use of the Company's revolving facility for the sale of trade
receivables.
14
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OVERVIEW (continued)
During the first quarter of 2001, the Company recorded restructuring and other
charges of approximately $10.5 million. The components of the charges were as
follows (in thousands):
Severance and employee-related costs $ 6,637
Loss on the sale of business 3,270
Strategic consulting fees 2,836
Other charges (recoveries) (2,199)
----------
Total $ 10,544
==========
In the fourth quarter of 2000, the Company communicated to its employees its
planned strategic initiatives to reduce operating expenses. As part of such
initiatives, the Company is reviewing employee functions and staffing levels to
eliminate redundant work or otherwise restructure work in a manner that will
lead to a reduction in the workforce. The process is expected to result in
involuntary terminations of approximately 700 employees during 2001. Formal
decisions on terminations are being made on a departmental basis. Severance and
employee-related costs represents the expense for termination benefits for
approximately 200 employees who were terminated during the first quarter of
2001.
During the quarter ended March 31, 2001, the Company sold the contracts and
related assets and liabilities associated with the outbound auto carriage
portion of its Brazilian SCS operation. The Company incurred a loss of
approximately $3.3 million on the sale of such business.
Strategic consulting fees of approximately $2.8 million were incurred during
2001 in relation to the aforementioned strategic initiatives. Other charges
(recoveries) represent a gain of approximately $2.2 million recorded in the
first quarter of 2001 on the sale of the corporate aircraft.
Activity related to restructuring reserves for the three months ended March 31,
2001 was as follows:
Dec. 31, March 31,
2000 2001
In thousands Balance Additions Deductions Balance
-------------------------------- -------- --------- ---------- ----------
Employee severance and benefits $ 3,908 6,637 2,881 7,664
Facilities and related costs 2,012 - 289 1,723
-------- --------- ---------- ----------
$ 5,920 6,637 3,170 9,387
======== ========= ========== ==========
Additions relate to 2001 restructuring employee severance benefits. Deductions
represent payments made related to restructuring charges.
At March, 31, 2001, the remaining balances of restructuring reserves relate to
severance and lease obligations related to closed facilities. Such obligations
are contractually required to be paid over the next three years.
The Company's effective income tax rate on earnings was 37.0 percent for the
first quarters of 2001 and 2000.
Net earnings in the first quarter of 2001 totaled $4.1 million, or $0.07 per
diluted share, compared with $19.8 million, or $0.33 per diluted share, during
the first quarter of 2000.
15
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OPERATING RESULTS BY BUSINESS SEGMENT
Three Months Ended
March 31,
----------------------
In millions 2001 2000
-------- ---------
Fleet management solutions
Total revenue $ 854.2 881.9
Fuel revenue (182.4) (196.6)
-------- ---------
Dry revenue $ 671.8 685.3
======== =========
Contribution margin $ 75.6 80.8
======== =========
Contribution margin as % of total revenue 8.9% 9.2%
======== =========
Contribution margin as % of dry revenue 11.3% 11.8%
======== =========
Supply chain solutions
Total revenue $ 385.3 386.6
Freight Under Management (FUM) expense (100.3) (97.2)
-------- ---------
Operating revenue $ 285.0 289.4
======== =========
Contribution margin $ 7.6 14.6
======== =========
Contribution margin as % of total revenue 2.0% 3.8%
======== =========
Contribution margin as % of operating revenue 2.7% 5.0%
======== =========
Dedicated contract carriage
Total revenue $ 130.6 133.6
Freight Under Management (FUM) expense (1.4) (0.9)
-------- ---------
Operating revenue $ 129.2 132.7
======== =========
Contribution margin $ 11.2 14.0
======== =========
Contribution margin as % of total revenue 8.6% 10.5%
======== =========
Contribution margin as % of operating revenue 8.7% 10.6%
======== =========
16
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OPERATING RESULTS BY BUSINESS SEGMENT (continued)
Management evaluates business segment financial performance based upon several
factors, of which the primary measure is contribution margin. Contribution
margin represents each business segment's revenue, less direct costs and direct
overheads related to the segment's operations. Business segment contribution
margin for all segments (net of eliminations), less CSS expenses and
restructuring and other charges, net, is equal to earnings before income taxes.
CSS are those costs incurred to support all business segments, including sales
and marketing, human resources, finance, shared management information systems,
customer solutions, health and safety, legal and communications.
The FMS segment leases revenue earning equipment, sells fuel and provides
maintenance and other ancillary services to the SCS and DCC segments.
Inter-segment revenues and contribution margin are accounted for at approximate
fair value as if the transactions were made to third parties. Contribution
margin related to inter-segment equipment and services billed to customers
(equipment contribution) is included in both FMS and the business segment which
served the customer, then eliminated. Equipment contribution included in SCS
contribution margin was $4.2 million and $5.1 million, respectively, for the
three months ended March 31, 2001 and 2000. Equipment contribution included in
DCC contribution margin was $4.6 million and $5.3 million, respectively, for the
three months ended March 31, 2001 and 2000. Interest expense is primarily
allocated to the FMS business segment.
Fleet Management Solutions
In the FMS segment, dry revenue (revenue excluding fuel) in the first quarter of
2001 totaled $671.8 million, a decrease of 2.0 percent from the same period in
2000. Full service lease and contract maintenance revenue increased 1.1 percent
in the first quarter of 2001 as a result of an increase in the number of
vehicles placed in service and increased revenue per unit. Rental revenue
decreased 9.8 percent in the first quarter of 2001 due primarily to lower
revenue per unit resulting from lower rental fleet utilization. Rental fleet
utilization for the three months ended March 31, 2001 was 63.3 percent, compared
to 67.7 percent for the same period in 2000. Pure rental revenue (total rental
revenue less rental revenue related to units provided to full service lease
customers) decreased 5.7 percent for the three months ended March 31, 2001 as
compared with the same period in 2000. Pure rental revenue and rental fleet
utilization statistics are monitored for the U.S. only; however, management
believes such metrics to be indicative of rental product performance for the
Company as a whole. Fuel revenue decreased 7.2 percent in the first quarter of
2001 over the same period in 2000 due primarily to decreased sales volume.
The contribution margin as a percentage of dry revenue was 11.3 percent in the
first quarter of 2001 compared with 11.8 percent in 2000. Decreased contribution
margin in 2001 compared to the same period in 2000 is due primarily to the
decrease in gains from the sale of equipment due to weakened used truck market
demand. The decrease is also attributed to the decrease in rental contribution
margin due to the decline in rental revenue and to lower pension income in 2001
compared with 2000. Such declines were partially offset by improvements in full
service and contract maintenance contribution margin due to improved performance
and reduced interest costs compared to the same period last year.
17
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OPERATING RESULTS BY BUSINESS SEGMENT (continued)
Fleet Management Solutions (continued)
The Company's fleet of owned and leased revenue earning equipment is
summarized as follows (number of units):
March 31, December 31,
By type: 2001 2000
----------------- -----------------
Trucks 67,800 66,800
Tractors 56,000 56,400
Trailers 48,400 48,500
Other 4,600 4,600
----------------- -----------------
176,800 176,300
================= =================
March 31, December 31,
By business: 2001 2000
----------------- -----------------
Full service lease 130,600 130,700
Commercial rental 42,800 42,200
Service vehicles and other 3,400 3,400
----------------- -----------------
176,800 176,300
================= =================
The totals in each of the tables above include the following non-revenue earning
equipment:
Not yet earning revenue (NYE) 2,800 2,400
No longer earning revenue (NLE) 9,200 8,300
----------------- -----------------
12,000 10,700
================= =================
NYE units represent new units on hand that are being prepared for deployment to
a lease customer or into the rental fleet. Preparations include activities such
as adding lift gates, decals, cargo area and refrigeration units.
NLE units represent units held for sale as well as units for which no revenue
has been earned for the previous thirty days. These vehicles may be temporarily
out of service, being prepared for sale or not rented due to lack of demand.
18
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OPERATING RESULTS BY BUSINESS SEGMENT (continued)
Supply Chain Solutions
In the SCS business segment, first quarter 2001 gross revenue of $385.3 million
was consistent with the same period in 2000. First quarter 2001 operating
revenue was $285.0 million, a decrease of 1.5 percent from the comparable period
a year ago. Revenue growth in North America, Asia and Mexico was offset by
revenue reductions in South America and Europe. North America revenue grew due
to stronger performance by its electronics and high technology operating unit.
Mexico revenue increased due to new business. The Company's Asian subsidiary was
acquired at the end of the third quarter of 2000 and therefore had no revenue in
the first quarter of 2000. Revenue reductions in South America were due to the
slowing economies in Brazil and Argentina and to the sale of the contracts and
related net assets associated with the outbound auto carriage business of the
Company's Brazilian SCS operations. European revenue decreases were due
primarily to the impact of exchange rates on translation of subsidiary revenues,
particularly those in the U.K., as well as due to lost business in the U.K.
The SCS business segment contribution margin decreased 47.9 percent to
$7.6 million in the first quarter of 2001 compared with the first quarter of
2000. Contribution margin as a percentage of operating revenue was 2.7 percent
in the first quarter of 2001, compared with 5.0 percent in the same quarter of
2000. The decrease in contribution margin was due primarily to the previously
mentioned volume reductions, lost business and certain contract execution
issues. The contract execution issues primarily represent higher operating costs
related to certain contracts for which negotiations of revised terms that will
allow the Company to pass the increased costs through to the customer have not
been finalized.
Dedicated Contract Carriage
In the DCC business segment, first quarter gross revenue totaled $130.6 million,
a decrease of 2.2 percent from the first quarter of 2000. First quarter
operating revenue was $129.2 million, a decrease of 2.6 percent from the
comparable period a year ago. Contribution margin decreased 20.0 percent to
$11.2 million in the first quarter of 2001 compared with the first quarter of
2000. The contribution margin as a percentage of operating revenue was
8.7 percent, compared with 10.6 percent in the first quarter of 2000. The lower
contribution margin in the first quarter of 2001 was due primarily to lost
business, volume reductions and continued revenue related price pressures due to
competition. Increased labor costs due to driver shortages have also led to the
reduction in margin.
19
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
OPERATING RESULTS BY BUSINESS SEGMENT (continued)
e-Commerce
e-Commerce revenue was $1.1 million for the three months ended March 31, 2001.
During 2000, the e-Commerce business segment was not yet in operation and
therefore had no revenue. e-Commerce reported negative contribution margin of
$2.6 million in the first quarter compared to negative contribution margin of
$0.5 in the same period of 2000. e-Commerce revenue and margin results are in
line with expectations for the quarter ended March 31, 2001.
Central Support Services
CSS expenses were as follows:
Three Months Ended
March 31,
--------------------------
In millions 2001 2000
----------- -----------
Sales and marketing $ 7.6 11.2
Human resources 5.4 4.6
Finance 13.6 13.2
Corporate services/public affairs 2.1 3.0
MIS 25.0 25.0
Customer solutions 3.8 4.5
Health and safety 2.3 2.3
Other 6.2 3.2
----------- -----------
Total Central Support Services $ 66.0 67.0
=========== ===========
The decrease in total CSS expense was due primarily to reductions in spending in
sales and marketing and corporate services due to the Company's expense
reduction initiatives. Such initiatives in these areas included ending the
Company's sponsorship of the Doral Ryder Open and the sale of the Company's
corporate jet, respectively. Other CSS expense was reduced in the first quarter
of 2000 by $3.8 million of income representing CSS interest allocation to the
business segments in excess of actual interest expense incurred by the Company
due to reduced debt balances in the first quarter of 2000.
20
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
The following is a summary of the Company's cash flows from operating, financing
and investing activities for the three months ended March 31, (in thousands):
2001 2000
---- ----
Net cash provided by (used in):
Operating activities $ (24,951) 435,451
Financing activities (242,205) (44,695)
Investing activities 232,608 (190,362)
---------- ---------
Net cash flows $ (34,548) 200,394
========== =========
A summary of the individual items contributing to the cash flow changes is
included in the Consolidated Condensed Statements of Cash Flows.
The decrease in cash flow from operating activities in the first three months of
2001, compared with the same period last year, was primarily attributable to
decreases in the aggregate balance of trade receivables sold. The increase in
cash used in financing activities in the first three months of 2001, compared to
the same period last year, was due to a lower balance in commercial paper
borrowings in 2001 compared with 2000 offset by higher repayment of debt in 2000
with a portion of the cash received from the sale of trade receivables. The
increase in cash provided by investing activities in the first three months of
2001 compared with the same period last year was attributable to lower capital
expenditures in 2001, as well as higher proceeds provided from the sale and
leaseback of revenue earning equipment in 2001 (see Debt and Other Financing
note in the Notes to Consolidated Condensed Financial Statements included in
this Form 10-Q).
A summary of capital expenditures for the three months ended March 31 follows
(in thousands):
2001 2000
---- ----
Revenue earning equipment $ 227,946 479,568
Operating property and equipment 22,257 17,699
---------- ---------
$ 250,203 497,267
========== =========
The decrease in capital expenditures was principally due to reduced demand for
new units as a result of increased pricing discipline over new business which
resulted in fewer sales but improved margins on business sold, improved controls
over capital expenditures and a reduction in the volume of early terminations of
full service leases compared to the first quarter of 2000. Management expects
capital expenditures for the full year 2001 will be approximately 13 percent
less than full year 2000 levels. The Company expects to fund its remaining 2001
capital expenditures with internally generated funds and borrowings.
Financing and Other Funding Transactions
Ryder utilizes external capital to support growth in its asset-based product
lines. The Company has a variety of financing alternatives available to fund its
capital needs. These alternatives include long- and medium-term public and
private debt, asset-backed securities, operating leases as well as variable-rate
financing available through bank credit facilities, commercial paper and
receivable conduits. The Company also periodically enters into sale and
leaseback agreements on revenue earning equipment, which are accounted for as
operating leases.
21
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
LIQUIDITY AND CAPITAL RESOURCES (continued)
Financing and Other Funding Transactions (continued)
The Company's debt ratings as of March 31, 2001 were as follows:
Commercial Unsecured
Paper Notes
------------- ------------
Moody's Investors Service P2 Baa1
Standard & Poor's Ratings Group A2 BBB
Fitch F2 BBB+
Total debt was $1.76 billion at March 31, 2001, a decrease of 12.6 percent from
December 31, 2000. During the first three months of 2001, the Company retired
$79.0 million of medium-term notes. U.S. commercial paper outstanding at March
31, 2001 decreased to $254.0 million, compared with $441.1 million at December
31, 2000, due primarily to debt pay down with proceeds received from the
sale-leaseback transaction completed in the first quarter of 2001 (described in
the Debt and Other Financing note to the Consolidated Condensed Financial
Statements included in this Form 10-Q).
The Company's foreign debt decreased approximately $39.8 million from December
31, 2000 to $344.9 million at March 31, 2001. The Company's percentage of
variable-rate financing obligations was 27.1 percent at March 31, 2001 compared
to 31.8 percent at December 31, 2000. The Company's debt-to-equity ratio at
March 31, 2001 decreased to 142.7 percent from 161.0 percent at December 31,
2000.
The Company participates in an agreement to sell, with limited recourse, up to
$375.0 million of trade receivables on a revolving basis through July 2004. At
March 31, 2001 and December 31, 2000, the outstanding balance of receivables
sold pursuant to this agreement was $250.0 and $345.0 million, respectively.
RECENT ACCOUNTING PRONOUNCEMENTS
In September 2000, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 140, "Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities,"
which replaces SFAS No. 125. SFAS No. 140 provides consistent standards for
distinguishing transfers of financial assets that are sales from transfers that
are secured borrowings. SFAS No. 140 is effective for transfers and servicing of
financial assets and extinguishments of liabilities (the "Transfer" provisions)
occurring after March 31, 2001, and is effective for recognition and
reclassification of collateral and for disclosures relating to sale-leaseback
transactions and collateral (the "Disclosure" provisions) for fiscal years
ending after December 15, 2000. The Company adopted the Disclosure provisions of
SFAS No. 140 as discussed in the 2000 Annual Report and adopted the Transfer
provisions for transactions subsequent to March 31, 2001. Adoption of this
statement did not have a material impact on the Company's financial position and
did not impact cash flows or results of operations.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133, as amended, requires all
derivatives, including certain derivatives imbedded in other contracts, to be
recognized at fair value as either assets or liabilities on the balance sheet
and establishes new accounting rules for hedging instruments. The Company
adopted SFAS No. 133 on January 1, 2001. Adoption of this statement did not have
a material impact on the Company's financial position and did not impact cash
flows or results of operations.
22
ITEM 2. Management's Discussion and Analysis of Results of Operations
and Financial Condition (continued)--
Three months ended March 31, 2001 and 2000
FORWARD-LOOKING STATEMENTS
This management's discussion and analysis of results of operations and financial
condition contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. These statements are based on
the Company's current plans and expectations and involve risks and uncertainties
that may cause actual results to differ materially from the forward-looking
statements. Generally, the words "believe," "expect," "estimate," "anticipate,"
"will" and similar expressions identify forward-looking statements.
Important factors that could cause such differences include, among others:
general economic conditions in the U.S. and worldwide; the market for the
Company's used equipment; the highly competitive environment applicable to the
Company's operations (including competition in supply chain solutions and
dedicated contract carriage from other logistics companies as well as from air
cargo, shippers, railroads and motor carriers and competition in full service
leasing and commercial rental from companies providing similar services as well
as truck and trailer manufacturers that provide leasing, extended warranty
maintenance, rental and other transportation services); greater than expected
expenses associated with the Company's activities (including increased cost of
fuel, freight and transportation) or personnel needs; availability of equipment;
changes in customers' business environments (or the loss of a significant
customer) or changes in government regulations.
The risks included here are not exhaustive. New risk factors emerge from time to
time and it is not possible for management to predict all such risk factors or
to assess the impact of such risk factors on the Company's business.
Accordingly, the Company undertakes no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events or otherwise.
23
ITEM 3. Quantitative and Qualitative Disclosure About Market Risk
In the normal course of business, the Company is exposed to fluctuations in
interest rates, foreign exchange rates and fuel prices. The Company manages such
exposures in several ways including, in certain circumstances, the use of a
variety of derivative financial instruments when deemed prudent. The Company
does not enter into leveraged derivative financial transactions or use
derivative financial instruments for trading purposes.
The Company's quantitative and qualitative disclosures about market risk for
changes in interest rates and foreign exchange rates have not materially changed
since December 31, 2000. The Company's disclosures about market risk are
contained in the Annual Report on Form 10-K for the year ended December 31,
2000. No interest rate swap or cap agreements or foreign currency option
contracts or forward agreements were outstanding at March 31, 2001 or 2000.
24
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K:
(a) Exhibits
--------
(3.1) The Ryder System, Inc. Restated Articles of Incorporation,
dated November 8, 1985, as amended through May 18, 1990,
previously filed with the Commission as an exhibit to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1990, are incorporated by reference into this
report.
(3.2) The Ryder System, Inc. By-Laws, as amended through February 16,
2001, previously filed with the Commission as an exhibit to the
Company's Annual Report on Form 10-K for the year ended
December 31, 2000, are incorporated by reference into this
report.
(15) Letter regarding unaudited interim financial statements.
(b) Reports on Form 8-K
-------------------
On March 12, 2001, the Company furnished information under Item 9.
Regulation FD Disclosure in a report on Form 8-K.
The 8-K provides answers to questions that were submitted by analysts
and investors prior and subsequent to the Company's February 7, 2001
earnings conference call. The Company also published the question and
answer document (Q and A) on its web site (www.ryder.com).
25
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
RYDER SYSTEM, INC.
(Registrant)
Date: May 8, 2001 /S/ CORLISS J. NELSON
---------------------
Corliss J. Nelson
Senior Executive Vice President
and Chief Financial Officer
(Principal Financial Officer)
Date: May 8, 2001 /S/ KATHLEEN S. PARTRIDGE
--------------------------
Kathleen S. Partridge
Senior Vice President and Controller
(Principal Accounting Officer)
26
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
(3.1) The Ryder System, Inc. Restated Articles of Incorporation,
dated November 8, 1985, as amended through May 18, 1990,
previously filed with the Commission as an exhibit to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1990, are incorporated by reference into this
report.
(3.2) The Ryder System, Inc. By-Laws, as amended through February
16, 2001, previously filed with the Commission as an exhibit
to the Company's Annual Report on Form 10-K for the year ended
December 31, 2000, are incorporated by reference into this
report.
(15) Letter regarding unaudited interim financial statements.
27