Ryder Reports Second Quarter 2024 Results

Delivers Solid Q2 Results; Continues to Outperform Prior Cycles

Second Quarter 2024 Highlights

GAAP EPS from continuing operations of $2.83 compared to $(0.39) in prior year, which reflected a non-cash FMS U.K. business exit charge
Comparable EPS (non-GAAP) from continuing operations of $3.00, as compared to $3.61 in prior year, reflecting weaker market conditions in rental and used vehicle sales, partially offset by higher earnings in contractual lease, supply chain, and dedicated businesses
Total revenue of $3.2 billion compared to $2.9 billion in prior year
Operating revenue (non-GAAP) of $2.6 billion, up 10%, reflecting recent acquisitions

Full-Year 2024 Forecast

Adjusted ROE (ROE) of 16% - 16.5%
Comparable EPS (non-GAAP) of $11.90 - $12.40
Operating revenue (non-GAAP) expected to increase by approximately 8%
Net cash provided by operating activities from continuing operations of $2.4 billion and free cash flow (non-GAAP) of positive $150 - $250 million

Ryder System, Inc. (NYSE: R), a leader in supply chain, dedicated transportation, and fleet management solutions, reported results for the three months ended June 30 as follows:

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Ryder is a leader in supply chain, dedicated transportation, and fleet management solutions. (Photo: Business Wire)

(In millions, except EPS)

Earnings

Before Taxes

Earnings

Diluted

Earnings

Per Share

2024

2023

2024

2023

2024

2023

Continuing operations (GAAP)

178

126

(18

)

2.83

(0.39

)

Comparable (non-GAAP)

188

237

134

170

3.00

3.61

Total and operating revenue for the three months ended June 30 were as follows:

(In millions)

Total Revenue

Operating Revenue

(non-GAAP)

2024

2023

Change

2024

2023

Change

Total

3,182

2,884

10%

2,561

2,326

10%

Fleet Management Solutions (FMS)

1,478

1,459

1,276

1,254

Supply Chain Solutions (SCS)

1,341

1,179

14%

989

865

14%

Dedicated Transportation Solutions (DTS)

635

440

44%

485

327

48%

CEO Comment

"Ryder delivered solid second-quarter results and continued to outperform prior cycles," says Ryder Chairman and CEO Robert Sanchez. "Comparable EPS were above our forecast primarily reflecting better-than-expected ChoiceLease results. ROE of 16% demonstrated the increased resilience of our transformed business model and is in line with our expectations for the latter stage of a freight-cycle downturn.

"Our contractual lease, dedicated, and supply chain businesses generated higher year-over-year earnings. Higher ChoiceLease results and our maintenance cost-savings initiatives benefited FMS. Strong automotive performance benefited SCS. In DTS, integration of the Cardinal Logistics acquisition remains on track and we continue to expect to achieve planned synergies.

“Long-term secular growth trends remain intact for all of our contractual businesses, although we are experiencing near-term sales headwinds that include customer fleet reductions and delayed decision-making that reflect the extended freight downturn and overall economic uncertainty. We remain well positioned to grow with our customers as conditions improve.

"Our strong balance sheet and increased return profile provide us with ample capacity to support organic growth and strategic acquisitions as well as return capital to shareholders through share repurchases and dividends. We recently announced a 14% increase to our quarterly dividend which demonstrates our continued confidence in the earnings power of our transformed business model."

Second Quarter 2024 Segment Review

Fleet Management Solutions: Earnings Reflect Weaker Market Conditions in Rental and Used Vehicle Sales, Partially Offset by Higher ChoiceLease Performance

(In millions)

2Q24

2Q23

Change

Total Revenue

1,478

1,459

Operating Revenue (1)

1,276

1,254

Earnings Before Tax (EBT)

133

180

(26)%

EBT as a % of total revenue

9.0%

12.3%

(330) bps

EBT as a % of operating revenue (1)

10.4%

14.4%

(400) bps

(1) Non-GAAP financial measure excluding fuel services revenue.

FMS total revenue and operating revenue increased 1% and 2%, respectively.
- Total revenue primarily reflects higher operating revenue
- Operating revenue reflects higher ChoiceLease revenue, partially offset by lower rental demand
FMS EBT of $133 million
- Higher ChoiceLease performance and benefits from maintenance cost-savings initiatives
- Lower used vehicle gains compared to elevated levels in prior year and weaker rental demand
- Used truck and tractor pricing declined 27% and 19%, respectively from prior year, and declined 10% for trucks and increased 5% for tractors, sequentially from first quarter of 2024
- Rental power-fleet utilization was 69%, down from 75% in prior year on a 11% smaller average power fleet

Supply Chain Solutions: Solid Earnings Reflect Continued Growth

(In millions)

2Q24

2Q23

Change

Total Revenue

1,341

1,179

14%

Operating Revenue (1)

989

865

14%

Earnings Before Tax (EBT)

13%

EBT as a % of total revenue

6.4%

6.4%

— bps

EBT as a % of operating revenue (1)

8.6%

8.7%

(10) bps

(1) Non-GAAP financial measure excluding fuel and subcontracted transportation.

SCS total revenue and operating revenue both increased 14%
- Total revenue primarily reflects increased operating revenue and higher subcontracted transportation costs passed through to customers
- Increase in operating revenue driven by recent acquisitions and organic growth across all industry verticals
SCS EBT grew to $85 million
- EBT growth primarily reflects stronger automotive performance

Dedicated Transportation Solutions: Strong Operating Performance Partially Offset by Acquisition Costs

(In millions)

2Q24

2Q23

Change

Total Revenue

635

440

44%

Operating Revenue (1)

485

327

48%

Earnings Before Tax (EBT)

10%

EBT as a % of total revenue

5.8%

7.6%

(180) bps

EBT as a % of operating revenue (1)

7.6%

10.3%

(270) bps

(1) Non-GAAP financial measure excluding fuel and subcontracted transportation.

DTS total revenue increased 44% and operating revenue grew 48%
- Total and operating revenue increased due to the Cardinal Logistics acquisition
DTS EBT of $37 million
- Increase due to improved operating performance, partially offset by Cardinal Logistics acquisition integration and other related costs

Corporate Financial Information

Tax Rate

Our effective income tax rate from continuing operations was 29.1%, as compared to 140.8% in the prior year, due to the 2023 one-time, nondeductible cumulative currency translation adjustment loss from the FMS U.K. business exit. Our comparable effective income tax rate (a non-GAAP measure) from continuing operations, which excludes the impact of the prior year currency translation adjustment loss, was 29.0%, consistent with the 28.6% in the prior year.

Capital Expenditures, Cash Flow, and Leverage

Year-to-date capital expenditures decreased to $1.3 billion in 2024 compared to $1.8 billion in 2023, primarily reflecting reduced investments in the ChoiceLease fleet due to lower sales activity.

Year-to-date net cash provided by operating activities from continuing operations was $1.1 billion compared to $1.2 billion in 2023, primarily reflecting higher working capital needs. Free cash flow (non-GAAP) of $71 million compared to $16 million in 2023, reflects reduced capital expenditures partially offset by lower cash from operating activities and proceeds from sales of used vehicles and property.

Debt-to-equity as of June 30, 2024 was 245%, compared to 232% at year-end 2023, and remains below the company's long-term target of 250% to 300%.

Outlook

“Our high-performing contractual portfolio and transformed business model have enabled us to deliver solid results amid a challenging freight environment,” says Ryder Chief Financial Officer John Diez. “The business remains well positioned to benefit from the expected cycle upturn with ample capacity to fund growth, pay a reliable dividend, and return capital to shareholders. The high end of our full-year forecast range continues to assume a gradual recovery in rental and used vehicle sales in the second half, while the bottom end reflects ongoing weak conditions. We now expect to generate higher free cash flow for the year reflecting lower capital spending due to softer lease sales activity.”

Full Year 2024

Total Revenue Growth

~8%

Operating Revenue Growth (non-GAAP)

~8%

FY24 GAAP EPS

$11.15 - $11.65

FY24 Comparable EPS (non-GAAP)

$11.90 - $12.40

Adjusted ROE (1)

16% - 16.5%

Net Cash from Operating Activities from Continuing Operations

~$2.4B

Free Cash Flow (non-GAAP)

$150 - $250M

Capital Expenditures

~$2.9B

Debt-to-Equity

~240%

Third Quarter 2024

3Q24 GAAP EPS

$3.12 - $3.32

3Q24 Comparable EPS (non-GAAP)

$3.30 - $3.50

————————————

(1) The non-GAAP elements of this calculation have been reconciled to the corresponding GAAP measures. A numerical reconciliation of net earnings to adjusted net earnings and average shareholders' equity to adjusted average equity is provided in the Appendix - Non-GAAP Financial Measures Reconciliations at the end of this release.

Supplemental Company Information

Second Quarter Net Earnings

(In millions, except EPS)

Earnings

Diluted EPS

2024

2023

2024

2023

Earnings from continuing operations

126

(18

)

2.83

(0.39

)

Discontinued operations

—

0.01

(0.01

)

Net earnings

127

(18

)

2.84

(0.40

)

Year-to-Date Operating Results

(In millions, except EPS)

Six months ended June 30,

2024

2023

Change

Total revenue

6,279

5,836

Operating revenue (non-GAAP)

5,056

4,672

Earnings from continuing operations

212

122

73%

Comparable earnings from continuing operations (non-GAAP)

230

303

(24)%

Net earnings

212

121

75%

Earnings per common share (EPS) - Diluted

Continuing operations

4.72

2.60

82%

Comparable (non-GAAP)

5.13

6.42

(20)%

Net earnings

4.73

2.57

83%

Business Description

Ryder System, Inc. is a leading supply chain, dedicated transportation, and fleet management solutions company. Ryder's stock (NYSE: R) is a component of the Dow Jones Transportation Average and the S&P MidCap 400® index. The company's financial performance is reported in the following three, inter-related business segments:

Supply Chain Solutions – Ryder's SCS business segment optimizes logistics networks to make them more responsive and able to be leveraged as a competitive advantage. Globally-recognized brands in the automotive, consumer goods, food and beverage, healthcare, industrial, oil and gas, technology, and retail industries rely on Ryder's leading-edge technologies and world-class logistics engineers to help them deliver the goods that consumers use every day.
Dedicated Transportation Solutions – Ryder's DTS business segment combines the best of Ryder's leasing and maintenance capabilities with the safest and most professional drivers in the industry. With a dedicated transportation solution, Ryder helps customers increase their competitive position, reduce risk, and integrate their transportation needs with their overall supply chain.
Fleet Management Solutions – Ryder's FMS business segment provides a broad range of services to help businesses of all sizes, across virtually every industry, deliver for their customers. From leasing, maintenance, and fueling, to rental and used vehicle sales, customers rely on Ryder's expertise to help them lower their costs, redirect capital to other parts of their business, and focus on what they do best – so they can grow.

For more information on Ryder System, Inc., visit investors.ryder.com and ryder.com.

Note: Regarding Forward-Looking Statements

Certain statements and information included in this news release are "forward-looking statements" under the Federal Private Securities Litigation Reform Act of 1995, including: our forecast; our outlook; our expectations regarding market trends and economic environment, such as rental demand, economic growth, challenging freight environment, weakening used vehicle sales and rental, and declining volumes in our omnichannel retail vertical; our expectations regarding the freight cycle, including timing and the impact of the freight cycle on our businesses; our expectations regarding total and operating revenue, earnings per share, comparable earnings per share, adjusted ROE, earnings before income tax, net cash from operating activities from continuing operations, debt-to-equity, capital expenditures, operating cash flow and free cash flow, and the causes of change; our ability to execute our balanced growth strategy; the impact of inflationary pressures, such as inflationary cost recovery; our expectations regarding commercial rental demand and utilization and used vehicle sales volume and pricing; our expectations regarding long-term profitable growth and secular growth trends; our expectations with respect to our actions to increase returns and create long-term value; our expectations regarding used vehicle inventory and fleet size; our ability to outperform prior cycles; our ability to support organic growth, including growing our contractual lease, dedicated, and supply chain businesses at targeted returns; our expectations regarding strategic investments and acquisitions, including the acquisitions of Cardinal Logistics and Impact Fulfillment Services; and our expectations regarding our ability to return capital to shareholders, including through share repurchases and dividends. Our forward-looking statements also include our estimates of the impact of residual value estimates on earnings and depreciation expense that is based in part on our current assessment of the residual values and useful lives of revenue-earning equipment based on multi-year trends and our outlook for the expected near- and long-term used vehicle market. A variety of factors, many of which are outside of our control, could cause residual value estimates to differ from actual used vehicle sales pricing, such as changes in supply and demand of used vehicles; volatility in market conditions; changes in vehicle technology; competitor pricing; regulatory requirements; driver shortages; customer requirements and preferences; and changes in underlying assumption factors.

All of our forward-looking statements should be evaluated by considering the many risks and uncertainties inherent in our business that could cause actual results and events to differ materially from those in the forward-looking statements. Important factors that could cause such differences include: changes in general economic and financial conditions in the U.S. and worldwide; the ongoing supply chain and labor challenges and vehicle production constraints, including original equipment manufacturer delays; the effect of geopolitical events; our ability to adapt to changing market conditions, including lower than expected contractual sales, decreases in commercial rental demand or utilization, poor acceptance of rental pricing, declining market demand for or excess supply of used vehicles impacting current or estimated pricing, and our anticipated proportion of retail versus wholesale sales; declining customer demand for our services; higher than expected maintenance costs; lower than expected benefits from our cost-savings initiatives; our ability to effectively and efficiently integrate acquisitions into our business; lower than expected benefits from our sales, marketing, and new product initiatives; setbacks in the economic market or in our ability to retain profitable customer accounts; impact of changing laws and regulations; difficulty in obtaining adequate profit margins for our services; inability to maintain current pricing levels due to, for example, economic conditions, business interruptions, expenditures, labor disputes, and severe weather or other natural occurrences; competition from other service providers; changes in technology and new entrants; professional driver and technician shortages resulting in higher procurement costs and turnover rates; impact of supply chain disruptions; higher than expected bad debt reserves or write-offs; decrease in credit ratings; increased debt costs; adequacy of accounting estimates; our ability to effectively and efficiently integrate acquisitions into our business; higher than expected reserves and accruals particularly with respect to pension, taxes, insurance, and revenue; impact of changes in our residual value estimates and accounting policies, including our depreciation policy; unanticipated changes in fuel and alternative energy prices; unanticipated currency exchange rate fluctuations; fluctuations in inflation or interest rates; our ability to manage our cost structure; and the risks described in our filings with the Securities and Exchange Commission (SEC). The risks included here are not exhaustive. New risks 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 risks on our business. Accordingly, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Note: Regarding Non-GAAP Financial Measures

This news release includes certain non-GAAP financial measures as defined under SEC rules. Refer to Appendix - Non-GAAP Financial Measure Reconciliations at the end of the tables following this press release for reconciliations of the most comparable GAAP measure to the non-GAAP financial measure and the reasons why management believes the measure is important to investors. Additional information regarding non-GAAP financial measures as required by Regulation G and Item 10(e) of Regulation S-K can be found in our most recent Form 10-K, Form 10-Q, and Form 8-K filed with the SEC as of the date of this release, which are available at investors.ryder.com.

CONFERENCE CALL AND WEBCAST INFORMATION

Ryder’s earnings conference call and webcast is scheduled for July 25, 2024 at 11:00 a.m. ET. To join, click here.

LIVE AUDIO VIA PHONE

Toll Free Number:

888-394-8218

USA Toll Number:

323-994-2093

Audio Passcode:

Ryder

Conference Leader:

Calene Candela

WEBCAST REPLAY

An audio replay including the slide presentation will be available within four hours following the call. Click here then select Financials/Quarterly Results and the date.

ryder-financial

RYDER SYSTEM, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS - UNAUDITED

Three months ended June 30,

Six months ended June 30,

(In millions, except per share amounts)

2024

2023

2024

2023

Services revenue

2,114

1,778

4,151

3,599

Lease & related maintenance and rental revenues

948

976

1,884

1,955

Fuel services revenue

120

130

244

282

Total revenues

3,182

2,884

6,279

5,836

Cost of services

1,793

1,507

3,536

3,114

Cost of lease & related maintenance and rental

644

661

1,313

1,335

Cost of fuel services

116

126

237

275

Selling, general and administrative expenses

368

343

746

706

Non-operating pension costs, net

Used vehicle sales, net

(19

)

(55

)

(39

)

(127

)

Interest expense

188

137

Miscellaneous income, net

)

(11

)

(19

)

(31

)

Currency translation adjustment loss

—

188

—

188

Restructuring and other items, net

—

)

(26

)

3,004

2,840

5,987

5,591

Earnings from continuing operations before income taxes

178

292

245

Provision for income taxes

123

Earnings (loss) from continuing operations

126

(18

)

212

122

Earnings (loss) from discontinued operations, net of tax

—

)

Net earnings (loss)

127

(18

)

212

121

Earnings (loss) per common share — Diluted

Continuing operations

2.83

(0.39

)

4.72

2.60

Discontinued operations

0.01

(0.01

)

0.01

(0.02

)

Net earnings (loss)

2.84

(0.40

)

4.73

2.57

Weighted average common shares outstanding — Diluted

44.6

46.0

44.8

47.2

Diluted EPS from continuing operations

2.83

(0.39

)

4.72

2.60

Non-operating pension costs, net

0.17

0.17

0.33

0.34

Acquisition costs

0.01

—

0.11

—

FMS U.K. exit

—

(0.09

)

—

(0.39

)

Currency translation adjustment loss

—

3.90

—

3.87

Other, net

(0.01

)

0.02

(0.03

)

—

Comparable EPS from continuing operations (1)

3.00

3.61

5.13

6.42

(1) Non-GAAP financial measure. A reconciliation of GAAP EPS from continuing operations to comparable EPS from continuing operations is set forth in this table.

Note: Amounts may not be additive due to rounding.

RYDER SYSTEM, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED

(In millions)

June 30, 2024

December 31, 2023

Assets:

Cash and cash equivalents

164

204

Other current assets

2,207

2,061

Revenue earning equipment, net

8,968

8,892

Operating property and equipment, net

1,208

1,217

Other assets

3,861

3,404

16,408

15,778

Liabilities and shareholders' equity:

Current liabilities

2,098

2,066

Total debt (including current portion)

7,536

7,114

Other non-current liabilities (including deferred income taxes)

3,693

3,529

Shareholders' equity

3,081

3,069

16,408

15,778

SELECTED KEY RATIOS AND METRICS

June 30, 2024

December 31, 2023

Debt to equity

245%

232%

Three months ended June 30,

Six months ended June 30,

(In millions)

2024

2023

2024

2023

Comparable EBITDA (1)

704

674

1,340

1,302

Effective interest rate

5.2

4.5

5.1

4.3

Six months ended June 30,

(In millions)

2024

2023

Net cash provided by operating activities from continuing operations

1,078

1,221

Free cash flow (1)

Capital expenditures paid

1,324

1,652

Gross capital expenditures

1,301

1,813

Twelve months ended June 30,

2024

2023

Adjusted ROE (2)

16%

24%

________________

(1) Non-GAAP financial measure. See reconciliation of the non-GAAP elements of this calculation reconciled to the corresponding GAAP measures included in the Appendix - Non-GAAP Financial Measures section at the end of this release.

(2) The non-GAAP elements of the calculation have been reconciled to the corresponding GAAP measures. A numerical reconciliation of net earnings to adjusted net earnings and average shareholders' equity to adjusted average equity is provided in the Appendix - Non-GAAP Financial Measures section at the end of this release. Note: Amounts may not be additive due to rounding.

RYDER SYSTEM, INC. AND SUBSIDIARIES

BUSINESS SEGMENT REVENUE AND EARNINGS - UNAUDITED

Three months ended June 30,

Six months ended June 30,

(In millions)

2024

2023

Change

2024

2023

Change

Total Revenue:

Fleet Management Solutions:

ChoiceLease

856

781

10%

1,698

1,557

Commercial rental

244

301

(19)%

475

605

(21)%

SelectCare and other

176

172

354

354

—%

Fuel services revenue

202

205

(1)%

406

446

(9)%

Fleet Management Solutions

1,478

1,459

2,933

2,962

(1)%

Supply Chain Solutions

1,341

1,179

14%

2,643

2,380

11%

Dedicated Transportation Solutions

635

440

44%

1,198

894

34%

Eliminations

(272

)

(194

)

(39)%

(495

)

(400

)

(23)%

Total revenue

3,182

2,884

10%

6,279

5,836

Operating Revenue: (1)

Fleet Management Solutions

1,276

1,254

2,527

2,516

—%

Supply Chain Solutions

989

865

14%

1,961

1,744

12%

Dedicated Transportation Solutions

485

327

48%

911

649

40%

Eliminations

(189

)

(120

)

(58)%

(343

)

(237

)

(45)%

Operating revenue

2,561

2,326

10%

5,056

4,672

Business Segment Earnings:

Earnings from continuing operations before income taxes:

Fleet Management Solutions

133

180

(26)%

233

362

(35)%

Supply Chain Solutions

13%

149

61%

Dedicated Transportation Solutions

10%

(12)%

Eliminations

(34

)

(24

)

39%

(63

)

(49

)

29%

220

265

(17)%

373

468

(20)%

Unallocated Central Support Services

(22

)

(20

)

16%

(35

)

(35

)

Intangible amortization expense

(11

)

(26)%

(22

)

(17

)

(26)%

Non-operating pension costs, net

(10

)

(10

)

(21

)

(20

)

Other items impacting comparability, net

—

(183

)

(151

)

Earnings from continuing operations before income taxes

178

311%

292

245

19%

Provision for income taxes

(16)%

123

(35)%

Earnings (loss) from continuing operations

126

(18

)

815%

212

122

73%

________________

(1) Non-GAAP financial measure. See reconciliation of GAAP total revenue to operating revenue in the Appendix - Non-GAAP Financial Measures section at the end of this release.

Note: Amounts may not be additive due to rounding.

RYDER SYSTEM, INC. AND SUBSIDIARIES

BUSINESS SEGMENT REVENUE AND EARNINGS - UNAUDITED

Three months ended June 30,

Six months ended June 30,

(In millions)

2024

2023

Change

2024

2023

Change

Fleet Management Solutions

FMS total revenue

1,478

1,459

2,933

2,962

(1)%

Fuel services revenue (1)

(202

)

(205

)

(1)%

(406

)

(446

)

(9)%

FMS operating revenue (2)

1,276

1,254

2,527

2,516

—%

Segment earnings before income taxes

133

180

(26)%

233

362

(35)%

FMS earnings before income taxes as % of FMS total revenue

9.0%

12.3%

8.0%

12.2%

FMS earnings before income taxes as % of FMS operating revenue (2)

10.4%

14.4%

9.2%

14.4%

Three months ended June 30,

Six months ended June 30,

2024

2023

Change

2024

2023

Change

Supply Chain Solutions

SCS total revenue

1,341

1,179

14%

2,643

2,380

11%

Subcontracted transportation and fuel

(352

)

(314

)

12%

(682

)

(636

)

SCS operating revenue (2)

989

865

14%

1,961

1,744

12%

Segment earnings before income taxes

13%

149

61%

SCS earnings before income taxes as % of SCS total revenue

6.4%

6.4%

5.7%

3.9%

SCS earnings before income taxes as % of SCS operating revenue (2)

8.6%

8.7%

7.6%

5.3%

Three months ended June 30,

Six months ended June 30,

2024

2023

Change

2024

2023

Change

Dedicated Transportation Solutions

DTS total revenue

635

440

44%

1,198

894

34%

Subcontracted transportation and fuel

(150

)

(113

)

33%

(287

)

(245

)

17%

DTS operating revenue (2)

485

327

48%

911

649

40%

Segment earnings before income taxes

10%

(12)%

DTS earnings before income taxes as % of DTS total revenue

5.8%

7.6%

4.6%

7.0%

DTS earnings before income taxes as % of DTS operating revenue (2)

7.6%

10.3%

6.0%

9.6%

________________

(1) Includes intercompany fuel sales from FMS to SCS and DTS.

(2) Non-GAAP financial measure. A reconciliation of (1) GAAP total revenue to operating revenue for each business segment (FMS, SCS and DTS) and (2) segment earnings before taxes (EBT) as % of segment total revenue to segment EBT as % of segment operating revenue for each business segment is set forth in this table. Note: Amounts may not be additive due to rounding.

RYDER SYSTEM, INC. AND SUBSIDIARIES

BUSINESS SEGMENT INFORMATION - UNAUDITED

KEY PERFORMANCE INDICATORS

Our North America fleet of owned and leased revenue earning equipment and SelectCare vehicles, including vehicles under on-demand maintenance and used vehicles sold, is summarized as follows (number of units rounded to the nearest hundred):

Three months ended June 30,

Six months ended June 30,

2024/2023

2024

2023

2024

2023

Three Months

Six Months

ChoiceLease

Average fleet count

146,000

137,800

144,600

136,600

End of period fleet count

145,000

139,000

145,000

139,000

Average active fleet count (1)

137,600

129,700

136,000

129,200

End of period active fleet count (1)

136,800

130,500

136,800

130,500

Commercial rental

Average fleet count

35,500

40,200

35,600

40,700

(12)%

(13)%

End of period fleet count

35,400

39,200

35,400

39,200

(10)%

Rental utilization - power units (2)

(600)bps

(700)bps

Rental rate change - % (3)

—

Customer vehicles under SelectCare contracts

Average fleet count

50,400

52,600

50,800

53,300

(4)%

(5)%

End of period fleet count

48,500

51,700

48,500

51,700

(6)%

Customer vehicles under SCS contracts

End of period fleet count (4)

13,500

13,600

13,500

13,600

(1)%

End of period power vehicles (4)

4,100

4,100

4,100

4,100

—%

Customer vehicles under DTS contracts

End of period fleet count (4)

19,900

11,300

19,900

11,300

76%

End of period power vehicles (4)

7,600

5,300

7,600

5,300

43%

Used vehicle sales (UVS)

End of period fleet count

9,500

7,000

9,500

7,000

36%

Used vehicles sold

6,000

5,500

12,600

10,600

19%

UVS pricing change (5)

Tractors

(19

(41

(27

(38

Trucks

(27

(34

(28

(26

________________

(1) Active fleet count is calculated as those units currently earning revenue and not classified as not yet earning or no longer earning units.

(2) Rental utilization is calculated using the number of days units are rented divided by the number of days units available to rent based on the days in a calendar year (excluding trailers). (3) Represents percentage change compared to prior year period in average rental rate per day on power units using constant currency. (4) These vehicle counts are also included within the fleet counts for ChoiceLease, Commercial rental and SelectCare. (5) Represents percentage change compared to prior year period in average sales proceeds on used vehicle sales using constant currency.

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

This press release and accompanying tables include “non-GAAP financial measures” as defined by SEC rules. As required by SEC rules, we provide a reconciliation of each non-GAAP financial measure to the most comparable GAAP measure. Non-GAAP financial measures should be considered in addition to, but not as a substitute for or superior to, other measures of financial performance prepared in accordance with GAAP.

Specifically, the following non-GAAP financial measures are included in this press release:

Non-GAAP Financial Measure

Comparable GAAP Measure

Reconciliation in Section Entitled

Operating Revenue Measures:

Operating Revenue

Total Revenue

Appendix - Non-GAAP Financial Measure Reconciliations

FMS Operating Revenue

FMS Total Revenue

Business Segment Information - Unaudited

SCS Operating Revenue

SCS Total Revenue

DTS Operating Revenue

DTS Total Revenue

Operating Revenue Growth

Total Revenue Growth

Appendix - Non-GAAP Financial Measure Reconciliations

FMS EBT as a % of FMS Operating Revenue

FMS EBT as a % of FMS Total Revenue

Business Segment Information - Unaudited

SCS EBT as a % of SCS Operating Revenue

SCS EBT as a % of SCS Total Revenue

DTS EBT as a % of DTS Operating Revenue

DTS EBT as a % of DTS Total Revenue

Comparable Earnings Measures:

Comparable Earnings Before Income Tax and Comparable Tax Rate

Earnings Before Income Tax and Effective Tax Rate from Continuing Operations

Appendix - Non-GAAP Financial Measure Reconciliations

Comparable Earnings

Earnings from Continuing Operations

Appendix - Non-GAAP Financial Measure Reconciliations

Comparable EPS

EPS from Continuing Operations

Condensed Consolidated Statements of Earnings - Unaudited

Appendix - Non-GAAP Financial Measure Reconciliations

Adjusted Return on Equity (ROE)

Not Applicable. However, the non-GAAP elements of the calculation have been reconciled to the corresponding GAAP measures. A numerical reconciliation of net earnings to adjusted net earnings and average shareholders' equity to adjusted average equity is provided in the following reconciliations.

Appendix - Non-GAAP Financial Measure Reconciliations

Comparable Earnings Before Interest, Taxes, Depreciation and Amortization

Net Earnings

Appendix - Non-GAAP Financial Measure Reconciliations

Cash Flow Measures:

Total Cash Generated and Free Cash Flow

Cash Provided by Operating Activities from Continuing Operations

Appendix - Non-GAAP Financial Measure Reconciliations

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

Set forth in the table below is an overview of each non-GAAP financial measure and why management believes that presentation of each non-GAAP financial measure provides useful information to investors. See reconciliations for each of these measures following this table.

Operating Revenue Measures:

Operating Revenue

FMS Operating Revenue

SCS Operating Revenue

DTS Operating Revenue

Operating Revenue Growth

FMS EBT as a % of FMS Operating Revenue

SCS EBT as a % of SCS Operating Revenue

DTS EBT as a % of DTS Operating Revenue

Operating revenue is defined as total revenue for Ryder or each business segment (FMS, SCS and DTS) excluding any (1) fuel and (2) subcontracted transportation. We use operating revenue to evaluate the operating performance of our core businesses and as a measure of sales activity at the consolidated level for Ryder System, Inc., as well as for each of our business segments. We also use segment EBT as a percentage of segment operating revenue for each business segment for the same reason. Note: FMS EBT, SCS EBT and DTS EBT, our primary measures of segment performance, are not non-GAAP measures.

Fuel: We exclude FMS, SCS and DTS fuel from the calculation of our operating revenue measures, as fuel is an ancillary service that we provide our customers. Fuel revenue is impacted by fluctuations in market fuel prices and the costs are largely a pass-through to our customers, resulting in minimal changes in our profitability during periods of steady market fuel prices. However, profitability may be positively or negatively impacted by rapid changes in market fuel prices during a short period of time, as customer pricing for fuel services is established based on current market fuel costs.

Subcontracted transportation: We exclude subcontracted transportation from the calculation of our operating revenue measures, as these services are also typically a pass-through to our customers and, therefore, fluctuations result in minimal changes to our profitability. While our SCS and DTS business segments subcontract certain transportation services to third party providers, our FMS business segment does not engage in subcontracted transportation and, therefore, this item is not applicable to FMS.

Comparable Earnings Measures:

Comparable Earnings before Income Taxes (EBT)

Comparable Earnings

Comparable Earnings per Diluted Common Share (EPS)

Comparable Tax Rate

Adjusted Return on Equity (ROE)

Comparable EBT, Comparable Earnings and Comparable EPS are defined, respectively, as GAAP EBT, earnings and EPS, all from continuing operations, excluding (1) non-operating pension costs, net and (2) other items impacting comparability (as further described below). We believe these non-GAAP measures provide useful information to investors and allow for better year-over-year comparison of operating performance.

Non-operating pension costs, net: Our comparable earnings measures exclude non-operating pension costs, net, which include the amortization of net actuarial loss and prior service cost, interest cost and expected return on plan assets components of pension and postretirement benefit costs, as well as any significant charges for settlements or curtailments if recognized. We exclude non-operating pension costs, net because we consider these to be impacted by financial market performance and outside the operational performance of our business.

Other Items Impacting Comparability: Our comparable and adjusted earnings measures also exclude other significant items that are not representative of our business operations and vary from period to period.

Comparable Tax Rate is computed using the same methodology as the GAAP provision for income taxes. Income tax effects of non-GAAP adjustments are calculated based on the marginal tax rates to which the non-GAAP adjustments are related.

Adjusted ROE is defined as adjusted net earnings divided by adjusted average shareholders' equity and represents the rate of return on shareholders' investment. Other items impacting comparability described above are excluded, as applicable, from the calculation of adjusted net earnings and adjusted average shareholders' equity. We also exclude any significant charges for pension settlements or curtailments from the calculation of adjusted net earnings. We use adjusted ROE as an internal measure of how effectively we use the owned capital invested in our operations.

Comparable Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)

Comparable EBITDA is defined as net earnings, first adjusted to exclude discontinued operations and the following items, all from continuing operations: (1) non-operating pension costs, net and (2) any other items that are not representative of our business operations (these items are the same items that are excluded from comparable earnings measures for the relevant periods as described immediately above) and then adjusted further for (1) interest expense, (2) income taxes, (3) depreciation, (4) used vehicle sales results and (5) amortization.

We believe comparable EBITDA provides investors with useful information, as it is a standard measure commonly reported and widely used by investors and other interested parties to measure financial performance and our ability to service debt and meet our payment obligations. We believe that the inclusion of comparable EBITDA also provides consistency in financial reporting and aids investors in performing meaningful comparisons of past, present and future operating results. Our presentation of comparable EBITDA may not be comparable to similarly-titled measures used by other companies.

Comparable EBITDA should not be considered a substitute for, or superior to, the measures of financial performance determined in accordance with GAAP.

Cash Flow Measures:

Total Cash Generated

Free Cash Flow

We consider total cash generated and free cash flow to be important measures of comparative operating performance, as our principal sources of operating liquidity are cash from operations and proceeds from the sale of revenue earning equipment.

Total Cash Generated is defined as the sum of (1) net cash provided by operating activities, (2) net cash provided by the sale of revenue earning equipment, (3) net cash provided by the sale of operating property and equipment and (4) other cash inflows from investing activities. We believe total cash generated is an important measure of total cash flows generated from our ongoing business activities.

Free Cash Flow is defined as the net amount of cash generated from operating activities and investing activities (excluding acquisitions) from continuing operations. We calculate free cash flow as the sum of (1) net cash provided by operating activities, (2) net cash provided by the sale of revenue earning equipment and operating property and equipment, and (3) other cash inflows from investing activities, less (4) purchases of property and revenue earning equipment. We believe free cash flow provides investors with an important perspective on the cash available for debt service and for shareholders, after making capital investments required to support ongoing business operations. Our calculation of free cash flow may be different from the calculation used by other companies and, therefore, comparability may be limited.

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

OPERATING REVENUE RECONCILIATION

Three months ended June 30,

Six months ended June 30,

(In millions)

2024

2023

2024

2023

Total revenue

3,182

2,884

6,279

5,836

Subcontracted transportation and fuel

(621

)

(558

)

(1,223

)

(1,164

)

Operating revenue (1)

2,561

2,326

5,056

4,672

TOTAL CASH GENERATED / FREE CASH FLOW RECONCILIATION

Six months ended June 30,

(In millions)

2024

2023

Net cash provided by operating activities from continuing operations

1,078

1,221

Proceeds from sales (primarily revenue earning equipment) (2)

317

447

Total cash generated (1)

1,395

1,668

Purchases of property and revenue earning equipment (2)

(1,324

)

(1,652

)

Free cash flow (1)

________________

(1) Non-GAAP financial measure.

(2) Included in cash flows from investing activities

Note: Amounts may not be additive due to rounding.

COMPARABLE EARNINGS RECONCILIATION

Three months ended June 30,

Six months ended June 30,

(In millions)

2024

2023

2024

2023

Earnings (loss) from continuing operations

126

(18

)

212

122

Non-operating pension costs, net

Acquisition costs

—

FMS U.K. exit

—

)

—

(18

)

Currency translation adjustment loss

—

183

—

183

Other, net

—

)

—

Comparable earnings from continuing operations (1) (2)

134

170

230

303

Tax rate on continuing operations

29.1%

140.8%

27.7%

50.0%

Tax adjustments and income tax effects of non-GAAP adjustments (2)

(0.1)%

(112.2)%

(0.3)%

(22.7)%

Comparable tax rate on continuing operations (2)

29.0%

28.6%

27.4%

27.3%

________________

(1) The comparable provision for income taxes is computed using the same methodology as the GAAP provision for income taxes. Income tax effects of non-GAAP adjustments are calculated based on the marginal tax rates to which the non-GAAP adjustments are related.

(2) Non-GAAP financial measure. Note: Amounts may not be additive due to rounding.

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

ADJUSTED RETURN ON EQUITY RECONCILIATION

Twelve months ended June 30,

(Dollars in millions)

2024

2023

Net earnings

495

574

Other items impacting comparability

Tax impact (1)

)

Adjusted net earnings

499

708

Average shareholders' equity

3,082

2,976

Average adjustments to shareholders' equity (2)

)

(19

)

Adjusted average shareholders' equity

3,075

2,957

Adjusted return on equity (3)

16%

24%

________________

(1) Represents income taxes on other items impacting comparability.

(2) Represents the impact of other items impacting comparability, net of tax, to equity for the respective periods. (3) Adjusted return on equity is calculated by dividing Adjusted net earnings into Adjusted average shareholders' equity.

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

COMPARABLE EARNINGS BEFORE INCOME TAXES / COMPARABLE EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION RECONCILIATION

Three months ended June 30,

Six months ended June 30,

(In millions)

2024

2023

2024

2023

Net earnings (loss)

127

(18

)

212

121

(Earnings) loss from discontinued operations, net of tax

)

—

Provision for income taxes

123

EBT

178

292

245

Non-operating pension costs, net

Acquisition costs

—

FMS U.K. exit, primarily net commercial claim proceeds

—

)

—

(36

)

Currency translation adjustment loss

—

188

—

188

Other, net

)

—

)

Comparable EBT (1)

188

237

317

416

Interest expense

188

137

Depreciation

428

412

852

857

Used vehicle sales, net

(19

)

(55

)

(39

)

(125

)

Amortization

Comparable EBITDA

704

674

1,340

1,302

________________

(1) Non-GAAP financial measure. Non-GAAP elements of the calculation have been reconciled to the corresponding GAAP measures. A numerical reconciliation of earnings before income taxes from continuing operations to comparable earnings before income taxes from continuing operations is set forth in this table.

Note: Amounts may not be additive due to rounding.

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

OPERATING REVENUE GROWTH FORECAST RECONCILIATION

(In millions)

Twelve months ended December 31,

2024

2023

Change

Total revenue

12,700

11,783

Subcontracted transportation and fuel

(2,400

)

(2,286

)

Operating revenue (1)

10,300

9,497

COMPARABLE EARNINGS PER SHARE FORECAST RECONCILIATION

(In millions, except per share amounts)

Third Quarter 2024

Full Year 2024

EPS from continuing operations

$3.12 - $3.32

$11.15 - $11.65

Non-operating pension costs

0.19

0.74

Restructuring and other, net

(0.01

)

0.02

Comparable EPS from continuing operations forecast (1)

$3.30 - $3.50

$11.90 - $12.40

TOTAL CASH GENERATED / FREE CASH FLOW FORECAST RECONCILIATION

(In millions)

2024 Forecast

Net cash provided by operating activities from continuing operations

2,400

Proceeds from sales (primarily revenue earning equipment) (2)

600

Total cash generated (1)

3,000

Purchases of property and revenue earning equipment (2) (3)

(2,800

)

Free cash flow (1)

200

________________

(1) Non-GAAP financial measure.

(2) Included in cash flows from investing activities. (3) Amount updated to correct typographical error.

RYDER SYSTEM, INC. AND SUBSIDIARIES

APPENDIX - NON-GAAP FINANCIAL MEASURE RECONCILIATIONS - UNAUDITED

ADJUSTED RETURN ON EQUITY FORECAST RECONCILIATION

(In millions)

2024 Forecast

Net earnings

500

Other items impacting comparability (1)

Tax impact (2)

—

Adjusted net earnings for ROE (numerator) (3) [A]

505

Average shareholders' equity

3,100

Adjustment to equity (4)

—

Adjusted average total equity (denominator) (3) [B]

3,100

Adjusted return on equity (3) [A]/[B]

________________

(1) Forecasted other items impacting comparability includes other, net of $5 million.

(2) Represents the tax provision on other items impacting comparability. (3) Non-GAAP financial measure. Non-GAAP elements of the calculation have been reconciled to the corresponding GAAP measures. A numerical reconciliation of net earnings to adjusted net earnings and average shareholders' equity to adjusted average total equity set forth in this table. (4) Represents the impact to equity of items to arrive at adjusted earnings.

Note: Amounts may not be additive due to rounding.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240725961747/en/

Media: Amy Federman afederman@ryder.com

Investor Relations: Calene Candela ccandela@ryder.com

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