J.B. Hunt Transport Services, Inc.

Transcription

1 J.B. Hunt Transport Services, Inc. November 5, 2009

2 Disclosure Today s presentation and discussion will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Words such as expects, anticipates, intends, estimates, or similar expressions are intended to identify these forward-looking statements. These statements are based on J.B. Hunt s current plans and expectations and involve risks and uncertainties that could cause future activities and results of operations to be materially different from those set forth in the forward-looking statements. For further information, please refer to J.B. Hunt s reports and filings with the Securities and Exchange Commission Investor Conference 2

3 Help Us Facilitate Today s Session 4Please turn off all cell phones. 4Please reserve questions for the Q&A session at the end of each presentation Investor Conference 3

4 What Are We Going To Discuss? Important Long Term Short Term Unimportant No Control Control 2009 Investor Conference 4

5 Agenda 4Welcome, Introduction of Presenters and Agenda 4The Freight Economy, The Re-Engineered Supply Chain and Pricing 4Integrated Capacity Solutions (ICS) 4Technology Review and Demonstration 4Break 4J.B. Hunt Truck (JBT) 4Financial Highlights 4CEO Perspective (working lunch) 4Break 4Dedicated Contract Services (DCS) 4J.B. Hunt Intermodal (JBI) 4Break 4Tour of the Corwith and J.B. Hunt Facility Kirk Thompson Terry Matthews Shelley Simpson Kay Palmer Craig Harper David Mee Kirk Thompson John Roberts Paul Bergant 2009 Investor Conference 5

6 The Freight Economy November 5, 2009

7 J.B. Hunt Solutions Intermodal Dedicated Truckload Less Than Truckload Refrigerated Flatbed Professional Services Final Mile Delivery United States Canada Mexico Alaska Hawaii Puerto Rico U.S. Virgin Islands International Best-In-Class Safety Single Source Solution Customer Value Delivery Corporate Sustainability Operational Excellence First Class Equipment Financial Stability Awards & Recognition Customer Portal Equipment Tracking Carrier Management Process Optimization Payment Management Supply Chain Integration Safety Technology Driver Management 2009 Investor Conference 7

8 Customers Utilize Our Multiple Offerings 413 of our top-20 customers use all of our services 420 of our top-20 customers use three of our services 449 of our top-50 customers use at least three of our services 494 of our top-100 customers use at least three of our services Top-20 Customers: Revenue by Segment JBI DCS ICS JBT 0% 20% 40% 60% 80% 100% 2009 Investor Conference 8

9 One Customer, Multiple Solutions Proposals Bid Spot Business Segment Pricing and Capacity Customer Optimization (price, transit, capacity, characteristics) JBI JBT DCS ICS 2009 Investor Conference 9

10 History of Recessions Recession Freight Recession 2001 Recession 1995 Freight Recession 1991 Recession 1981 Recession 1980 De-Regulation 2009 Investor Conference 10

11 Changes in Supply Chain 4The re-engineering of U.S. Supply Chains 4Billions of truck and intermodal miles have been eliminated 4Started with ocean - all water from U.S. west coast ports Higher truck rates, fuel Higher fuel 2009 Investor Conference 11

12 Re-Engineering of Supply Chains 4Where are products produced? h Produced products at multiple locations h Co-packers - new locations h New plants 4 Bottom line: h Manufacturers produce products closer to end user h Billions of miles taken out of supply chain 2009 Investor Conference 12

13 Re-Engineering of Supply Chains 4 Minimization of Product 2009 Investor Conference 13

14 Re-Engineering of Supply Chains 4Condensed Product Full Cup Use 1/2 Cup Scoop of Powder Tablet 2009 Investor Conference 14

15 Re-Engineering of Supply Chains 4Packaging 2009 Investor Conference 15

16 Customer Survey - Inventory Levels 2009 vs vs Food Slightly Higher Flat 4 Consumer Products Flat Flat 4 Retail Significantly Lower Flat 4 Paper Flat to Down Flat 4 Manufacturing Significantly Lower Flat to Down 4 Automotive Significantly Lower Flat to Down 4 Building Products Significantly Lower Flat 2009 Investor Conference 16

17 Customer Survey - Sales 2009 vs vs Food + 1-2% + 1-2% 4 Consumer Products + 2-3% + 1-4% 4 Retail Flat to -5% Flat to +2% 4 Paper Flat to -6% + 1-2% 4 Manufacturing -7-10% Flat Sales 4 Automotive % % 4 Building Products - 22% Flat 2009 Investor Conference 17

18 Elements of Price 4Supply and Demand 4Service Differential 4Capacity 4Diversified Portfolio of Services 2009 Investor Conference 18

19 Elements of Intermodal Price 4Freight volumes increase - economy 4Legacy contracts change or not renewed 4Competitors understand their cost better 4Truck rates increase 2009 Investor Conference 19

20 Elements of Truck Price 4Freight volumes increase - economy 4More bankruptcies 4Less new trucks purchased 2008, 2009 and Fuel prices increase quickly 4Banks call loans 2009 Investor Conference 20

21 ICS - Pricing 4Shipments priced at market 4Shipper has needs 4Carrier has freight needs 4Balance of spot business to fix price business 2009 Investor Conference 21

22 How the Freight Mix Appears Today Length of Haul Comparison Truck Intermodal % of Total Loads > 2500 Miles 2009 Investor Conference 22

23 How the Freight Mix Will Look In Years Length of Haul Comparison Truck Intermodal % of Total Loads > 2500 Miles 2009 Investor Conference 23

24 International Freight Niche 4New boxes built in China 4Increases % of loaded containers delivered to the USA 2009 Investor Conference 24

25 Integrated Capacity Solutions November 5, 2009

26 Value Proposition Asset Overflow 3PLs J.B. Hunt Non-Asset 3PLs Many Service Offerings Consultative Sell Asset Indifferent Modal Indifferent Focused on Carrier Needs Reinvests Earnings in Assets Non-Asset Technical Platform Leverage Asset Strengths International Capabilities 2009 Investor Conference 26

27 Quick History 4In 2006, ICS achieved $42 million in operating revenue 4ICS employed 18 people October In 2006, ICS was an asset-overflow model reporting under the truck business segment 4ICS became a separate, reportable business segment in January Investor Conference 27

28 YTD Operating Income Up 56%... Operating Income (000) $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $ Q3 YTD 2008 Q3 YTD Investor Conference 28

29 On a 29% Increase in YTD Operating Revenue Operating Revenue (000's) $250,000 $200,000 $150,000 $100,000 $50,000 $ Q3 YTD 2008 Q3 YTD Investor Conference 29

30 Load Count Increased 85% YTD... Volume Growth 180, , , , ,000 80,000 60,000 40,000 20, Q3 YTD 2008 Q3 YTD Investor Conference 30

31 ...On an 85% Increase in Employees YTD Employee Growth Q3 YTD 2008 Q3 YTD Investor Conference 31

32 We re Not Just in Arkansas 2009 Investor Conference 32

33 And We Continue to Gain Experience Tenure Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q Investor Conference 33

34 We Believe in a Performance-Based Pay Model Employee Pay Model Total Expense Q1 '09 Q2 '09 Q3 '09 Q4 '09 Salary & Hourly Wages Commission 2009 Investor Conference 34

35 That Correlates With Operating Income Growth Q1 '09 YTD Q2 '09 YTD Q3 '09 YTD Total Compensation Operating Income 2009 Investor Conference 35

36 Customers Utilize Our Multiple Offerings 413 of our top-20 customers use all of our services 420 of our top-20 customers use our ICS service 450 of our top-50 customers use our ICS service 497 of our top-100 customers use our ICS service Top-20 Customers: Revenue by Segment JBI DCS ICS JBT 0% 20% 40% 60% 80% 100% 2009 Investor Conference 36

37 ICS Was an Asset Overflow Model in 2006 Proposals Bid Spot Business Segment Pricing and Capacity JBI JBT ICS 2009 Investor Conference 37

38 Today, We Are a Stand-Alone Model Proposals Bid Spot Business Segment Pricing and Capacity Customer Optimization (price, transit, capacity, characteristics) JBI JBT DCS ICS 2009 Investor Conference 38

39 We Sell All of J.B. Hunt s Solutions 4Intermodal 4Dedicated 4Truckload 4LTL 4Delivery 4Refrigerated 4Flatbed 4Expedited 2009 Investor Conference 39

40 ...And Have Grown Both Asset And Non-Asset Shipments Volume Growth Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Asset Shipments Non-Asset Shipments 2009 Investor Conference 40

41 We Have Leveraged Our Existing Sales Relationships Operating Revenue Existing Sales People E 2010E 2009 Investor Conference 41

42 ...And Grown Sales Headcount In Lowell Operating Revenue Existing Sales People ICS - Lowell Sales E 2010E 2009 Investor Conference 42

43 And The Field To Increase Revenue Operating Revenue Existing Sales People ICS - Lowell Sales ICS - Field Sales E 2010E 2009 Investor Conference 43

44 We Have Added New Customers 5, ,000 # of Bill To codes 3,000 2,000 1,000 - Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2009 Investor Conference 44

45 But There Are Still Plenty More 13% 87% ICS Customers Total Potential Customers 2009 Investor Conference 45

46 We Focused On Soliciting New Shippers. January Investor Conference 46

47 And Have Grown Our Market Share September Investor Conference 47

48 We Are Growing With Our Customers Q Customer Growth Over 3 Year Cycle Q1 '07 Q1 '08 Q1 '09 Q3 ' Investor Conference 48

49 And Diversifying Our Mix Of Business 90% % of Total Load Volume 80% 70% 60% 50% 40% 30% 20% 10% Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Contract Transactional 2009 Investor Conference 49

50 We Have Grown Both Categories In Shipments 40,000 Volume 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Contract Transactional 2009 Investor Conference 50

51 And Gross Margin Gross Margin (000) Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Contract Transactional 2009 Investor Conference 51

52 Average Gross Margin Of 19% YTD Gross Margin % % 21.0% 19.5% 18.0% 16.5% 15.0% 13.5% 12.0% First Quarter Second Quarter Third Quarter Fourth Quarter 2009 Investor Conference 52

53 By Focusing On Smaller Carriers 2007 Loads 2009 YTD Loads Carriers >100 Trucks Carriers <100 Trucks 32% 52% 48% 68% 2009 Investor Conference 53

54 We Continue To Expand Our Carrier Relationships ICS Capacity 23,000 18,000 Total Carriers 13,000 8,000 3, Investor Conference 54

55 Value Proposition Asset Overflow 3PLs J.B. Hunt Non-Asset 3PLs Many Service Offerings Consultative Sell Asset Indifferent Modal Indifferent Focused on Carrier Needs Reinvests Earnings in Assets Non-Asset Technical Platform Leverage Asset Strengths International Capabilities 2009 Investor Conference 55

56 Differentiating Technologies November 5, 2009

57 Technology That Differentiates Freight Sifter Proposals Bid Spot COMPASS Power Capacity & Forecast Capacity Czar Container Capacity & Forecast Business Segment Pricing and Capacity Customer Optimization (price, transit, capacity, characteristics) CHITA Carrier Market Rates EAGLE Profit Analysis By Lane and Service Level JBI JBT DCS ICS 2009 Investor Conference 57

58 Technology That Differentiates Opportunity Analyzer 4 A business unit neutral process that looks for the best overall solution for the customer. Freight Data Dedicated? N Y Run DCS Design Overflow Dedicated Summary Resource Summary Driver Utilization Summary Tractor Utilization Summary Routing Summary Operational Plan LTL? TL N Y Y Run LTL Opt Run TL Mode Opt Multi-stop TL LTL Summary TL Summary Enterprise Response LTL Optimization Summary LTL Summary Intermodal Conv. Summary Touring Summary Backhaul Summary Asset Summary Non-Asset Summary 2009 Investor Conference 58

59 Technology That Differentiates HEAT 4Approach: hget lane/shipment level information happly proprietary JBHT hubbing & freight pattern-recognition algorithms hidentify repeatable touring opportunities within shipper freight base 4Results: hpatterns identify attractive networked opportunities 2009 Investor Conference 59

60 Technology That Differentiates Mode Conversion Customer xyz 2009 Investor Conference 60

61 Technology That Differentiates Mode Conversion 4Recent Example: h A large retailer significantly converted their truck volume to intermodal h Carbon savings and transportation cost savings always move together OTR IM OTR IM Loads 1,701 12,810 1,681 19,084 Avg LOH 468 1, ,452 Point to Point Miles 795, MM 716, MM Tonnes CO2e 1,725 25,167 1,583 30,876 Total CO2e Carbon Savings 0 26,892 18, ,459 24,229 Total footprint redution % 41% 43% 2009 Investor Conference 61

62 Technology That Differentiates - DCS SHIPPER Tender Accept Status e Outsourced Services Dispatch/Order Management Turn-By-Turn Directions Delivery Mobile Technology Bar Code Scanning + esignature Invoice Payroll Etc Business Intelligence Account-Level P&Ls 2009 Investor Conference 62

63 Technology that Differentiates - PACE DCS customers want invoice terms that match their unique business model. Every customer is different. Every contract is different. 4Results h Scalable, award-winning invoicing, payroll, and reporting h Centralized data to provide security, control, and accuracy h Centralization of driver pay plans h Centralization of contract administration and other functions as desired h Billing and payroll synchronization supports the PAYB/BAYP philosophy h Support for customer unique requirements h More efficient implementation of startups h Real-time web-enabled information for clients 12 Best-in in-class Projects 2009 Investor Conference 63

64 2009 Investor Conference 64

65 Technology that Differentiates - Mobile Solutions 2009 Investor Conference 65

66 Technology that Differentiates Warehouse Management h Provides real-time visibility to freight in cross-dock, including returns, will-calls, and redelivers. h Facilitates staging workflow. h Critical for co-mingled freight and return processing 2009 Investor Conference 66

67 Technology that Differentiates Customer Survey 4Value Add: Real-time feedback from customers following deliveries. 4Focus on store and home delivery customers 4Feedback: Driver comments, product questions, avg. score of 95% Delivery Completed Triggers entry of survey in work queue Survey conducted via phone call to delivery recipient within 30 minutes of delivery. Robust reporting for survey results 2009 Investor Conference 67

68 Technology that Differentiates - Customer Survey DCS Delivery- Home and State Activity Date: 2/2/2009-2/9/2009 Region Account Participation On Time Same Personnel Appearance C Furniture Customer ABC C Building Supply Customer ABC C Consumer Electronics Customer ABC C Appliance Customer ABC CENTRAL AVERAGE MW Fast Food Customer ABC MW Fast Food Customer XYZ MW Office Supply Customer ABC MW Grain Supplier Customer ABC MIDWEST AVERAGE NE Consumer Electronics Customer ABC NE Home Supply Customer ABC NE Fast Food Customer ABC NE Consumer Electronics Customer ABC NE Furniture Customer ABC NORTHEAST AVERAGE Investor Conference 68

69 Technology that Differentiates - Trucks on a Map 2009 Investor Conference 69

70 Technology that Differentiates - Trailers on a Map 2009 Investor Conference 70

71 J.B. Hunt Truck November 5, 2009

72 Value Proposition for JBT Introductory service for other business segments Part of the solution, not the entire answer Modal / Segment Indifferent Random Truck Load Carriers J.B. Hunt Truck Non-Asset 3PLs Network Balance = Better Service Focus: Commitment to allocation process Real-time tractor & trailer tracking Safety First culture Well-maintained assets w/company shops Reinvests earnings in assets Flexibility with large trailer pools 2009 Investor Conference 72

73 Customers Utilize Our Multiple Offerings 413 of our top-20 customers use all of our services 420 of our top-20 customers use our Truck service 449 of our top-50 customers use our Truck service 495 of our top-100 customers use our Truck service Top-20 Customers: Revenue by Segment JBI DCS ICS JBT 0% 20% 40% 60% 80% 100% 2009 Investor Conference 73

74 The Inflection Point 4 Planned fleet size reduction will be complete by Dec 31, Still one of largest TL carriers in the U.S. 4 Customers want our service. We are part of JBHT s full service, multi-modal capacity 4 A significant improvement in OI over the last few months - near breakeven in Q3 4 Reengineered ourselves with more network balance in order to drive out cost and inefficiencies, and lowered other costs in many areas 4 Believe the lower cost structure will sustain a margin through all business cycles 4 Our network balance allows us to offer customers high service 4 Our dedication to safety makes us the safest truckload carrier 4 Most volatile JBHT segment, but offers the most upside when market turns 2009 Investor Conference 74

75 Capacity Equation Will Change, Rates Will Adjust - When? 4Potential increase in fuel cost could drive more failures 4Age of equipment will continue to drive high maintenance cost, setting the stage for more failures for undercapitalized operations 4 Driver shortage will resurface, applying pressure on rates 4 Government regulations regarding driver and carrier safety will increase h December 2009 Pre-employment Screening h July 2010 CSA 2010 h CARB regulations h Potential changes in HOS 2009 Investor Conference 75

76 Truck Count 7,000 EOP Truck Count 6,000 5,000 4,000 3,000 2,000 1, Q Q ,718 5,603 5,423 5,396 5,510 5,196 4,183 3,330 3,309 3,227 Still one of America s largest truckload carriers! 2009 Investor Conference 76

77 In Order To Survive cost had to be driven out at a higher rate than revenue was decreasing Network Balance Rate Per Mile Improved Asset Utilization Lower Driver/IC Pay Improved Fuel Efficiency Reduced Empty Miles Improved Safety Reduced Driver Turnover Improved Customer Service 2009 Investor Conference 77

78 We Believe That Our New Cost Structure Is Sustainable Network Balance Rate Per Mile Improved Asset Utilization Lower Driver/IC Pay Improved Fuel Efficiency Reduced Empty Miles Improved Safety Reduced Driver Turnover Improved Customer Service 2009 Investor Conference 78

79 Fuel MPG Fuel MPG Q 2008 YTD 3Q 2009 YTD 2009 Investor Conference 79

80 Cost Reductions Major Cost Reductions Service Centers Closures: Cost $(000) $13,191 $13,210 $10,686 $7,751 Driver Hiring Employees Cost $(000) $30,470 $24,566 $18,647 $12, Investor Conference 80

81 Corporate Driver Personnel 2009 Investor Conference 81

82 Corporate Driver Personnel 2009 Investor Conference 82

83 Strong Safety Track Record 12 Safety Factor Analysis of 13 Major Carriers (Average Ranking on 8 Safety Factors - Lower is better) st Place Tie JB Hunt Crete Heartland Schneider Swift Celadon PAM Covenant US Xpress Werner CR England USA Truck Knight Source: Department of Transportation websites ( and aka-safestat). The SAFESTAT data was last updated August 28, Investor Conference 83

84 DOT Preventable Collisions Per Million Miles / YTD Through September Investor Conference 84

85 Injuries per 100 Drivers / YTD Through September Investor Conference 85

86 Summary There are enough customers who value our service offerings that will allow us to make a reasonable return with this fleet size. 4 Planned fleet size reduction will be complete by Dec 31, Still one of largest TL carriers in the U.S. 4 Customers want our service. We are part of JBHT s full service, multi-modal capacity 4 A significant improvement in OI over the last few months--near breakeven in Q3 4 Reengineered ourselves with more network balance in order to drive out cost and inefficiencies 4 The lower cost structure will sustain a margin through all business cycles 4 Our network balance allows us to offer customers high service 4 Our dedication to safety makes us the safest truckload carrier 4 Most volatile JBHT segment, but offers most upside when market turns 2009 Investor Conference 86

87 Financial Overview November 5, 2009

88 Income Statement For The Nine Months Ended September 30, 2009 Revenue (000) Operating Income (Loss) (000) Amount % of Total Amount % of Total JBI $ 1,272,393 55% $ 129,678 74% DCS 550,443 24% 44,305 25% JBT 328,826 14% (10,259) (6%) ICS 192,236 8% 11,381 7% Elim/Other (17,529) (1%) (70) -- $ 2,326, % $ 175, % 2009 Investor Conference 88

89 Balance Sheet September 30, 2009 December 31, 2008 Percentage Change Total Assets (000) $ 1,858,095 $ 1,793,453 4% Stockholders Equity (000) $ 607,654 $ 529,011 15% 3 Ratio Comparison December 31, 2008 September 30, % 45.0% Annulized Returns December 31, 2008 September 30, % 35.0% % % 20.0% % % 5.0% 0 Current Ratio Total Debt to Equity Ratio Total Liabilities to Equity Ratio TTM Debt to EBITDA 0.0% Average Equity Average Invested Capital 2009 Investor Conference 89

90 Annualized Return On Average Equity* Return on Average Equity 60% December 31, 2008 September 30, % 40% 30% 20% 10% 0% CHRW LSTR JBHT HTLD HUBG KNX WERN *Computation = Annual or annualized net income / average stockholders equity 2009 Investor Conference 90

91 Annualized Return On Invested Capital* Return on Invested Capital 35% December 31, 2008 September 30, % 25% 20% 15% 10% 5% 0% CHRW LSTR HTLD JBHT HUBG KNX WERN *Computation = Annual or annualized net income / (average stockholders equity + average total debt) 2009 Investor Conference 91

92 Cash Flow (000) For The Nine Months Ended September 30, 2009 For The Six Months Ended June 30, 2009 For The Three Months Ended March 31, 2009 Net Cash Provided from Operations $ 248,160 $ 150,638 $ 73,322 Net CAPEX (201,307) (134,692) (46,594) Other (7,568) (8,913) (6,771) Net Cash Used in Investing (208,875) (143,605) (53,365) Long-term Debt Repayment (68,500) (7,000) (3,500) Dividends Paid (41,702) (27,742) (13,869) Borrowings (Repayments) from Revolving Credit Line 61,285 18,087 (1,730) Other 11,970 10, Net Cash Used in Financing Activities (36,947) (5,836) (18,754) Net Increase in Cash & Equivalents $ 2,338 $ 1,197 $ 1, Investor Conference 92

93 Cash Flow For The Nine Months Ended September 30, 2009 (000) For The Six Months Ended June 30, 2009 For The Three Months Ended March 31, 2009 Net Cash Provided from Operations Net CAPEX $ 248,160 (201,307) $ 150,638 Continue to fund growth through (134,692) $ 73,322 (46,594) Other current operations. (7,568) (8,913) (6,771) Net Cash Used in Investing (208,875) (143,605) (53,365) Long-term Debt Repayment (68,500) (7,000) (3,500) Dividends Paid (41,702) (27,742) (13,869) Borrowings (Repayments) from Revolving Credit Line 61,285 18,087 (1,730) Other 11,970 10, Net Cash Used in Financing Activities (36,947) (5,836) (18,754) Net Increase in Cash & Equivalents $ 2,338 $ 1,197 $ 1, Investor Conference 93

94 Capital Allocation Process 4Maintenance Capital Expenditures h Business units are currently at manageable size h Maintain a market priced age of fleet h Amount fluctuates based on OEM values for trades 4Growth Capital Expenditures h Internal ROIC analysis h Strategic growth and market placement h Cash flow generation 2009 Investor Conference 94

95 Projected Net Capital Expenditures Calendar Year 2009 (millions) Actual Through September 30, 2009 Fourth Quarter 2009 Total 2009 $ $ 294 Calendar Year 2010 Net Maintenance Capital Budgeted Growth Capital Total 2010 $ $ and Beyond Net Maintenance Capital $ 150 each year 2009 Investor Conference 95

96 Uses of Free Cash 4Repayment of debt h Revolver ($226 million outstanding at September 30, 2009) expires in March 2012 h Senior Notes ($400 million outstanding at September 30, 2009) 4Dividend 4$200 million Due March $50 million Due July $50 million Due July $100 million Due July 2014 h Board guideline to maintain a S&P 500 like yield 4 Stock Buyback h No current authorization h Must be accretive h Current liquidity best used for JBI and DCS growth 2009 Investor Conference 96

97 CEO Perspective November 5, 2009

98 Purple Cow 2009 Investor Conference 98

99 Dedicated Contract Services November 5, 2009

100 DCS Value Proposition Dedicated Capacity J.B. Hunt DCS Full Service Lease Customized Complex Solutions National Crossdock Network Inventory Management Capabilities Long-Term Contracts (3+ years) Fixed and Variable Pricing Specialized Equipment On-Site Management Supply Chain-Enabling Technology Customer-Driven Contract Administration & Reporting Diversified Portfolio of Services 2009 Investor Conference 100

101 Customers Utilize Our Multiple Offerings 413 of our top-20 customers use all of our services 413 of our top-20 customers use our DCS service 425 of our top-50 customers use our DCS service 440 of our top-100 customers use our DCS service Top-20 Customers: Revenue by Segment JBI DCS ICS JBT 0% 20% 40% 60% 80% 100% 2009 Investor Conference 101

102 Channel Mix DCS Channel Summary Percent of Total Revenue 60% YTD 09/30/09 50% 40% 30% 20% 10% 0% Delivery Replenishment Specialized Capacity 2009 Investor Conference 102

103 Channel Overview - Specialized 2009 Investor Conference 103

104 Channel Overview - Replenishment 2009 Investor Conference 104

105 Channel Overview - Delivery 2009 Investor Conference 105

106 Channels GROWTH% 35 D S Double-Digit Growth plus 90%+ Retention Capacity Replenishment Specialized Delivery 10 5 R RETENTION% -45 C 2009 Investor Conference 106

107 Channel Overview Revenue ( 05 Sept 09) Capacity Specialized SEPT YTD 2009 SEPT YTD SEPT YTD 2009 SEPT YTD Replenishment Delivery SEPT YTD 2009 SEPT YTD SEPT YTD 2009 SEPT YTD 2009 Investor Conference 107

108 Channel Overview Truck Count ( 05 Sept 09) Capacity Specialized SEPT YTD 2009 SEPT YTD SEPT YTD 2009 SEPT YTD Replenishment Delivery SEPT YTD 2009 SEPT YTD SEPT YTD 2009 SEPT YTD 2009 Investor Conference 108

109 Channel Overview Profitability ( 05 Sept 09) Capacity Specialized SEPT YTD Replenishment 2009 SEPT YTD SEPT YTD Delivery 2009 SEPT YTD SEPT YTD 2009 SEPT YTD SEPT YTD 2009 SEPT YTD 2009 Investor Conference 109

110 Channel Retention 120% 110% 100% 90% 80% 70% 60% 50% 40% 30% 20% 05/01/ /15/ /29/ /12/ /26/ /10/ /24/ /07/ /21/ /04/ /18/ /02/ /16/ /30/ /13/ /27/ /11/ /25/ /08/ /22/ /05/ /19/ /05/ /19/ /02/ /16/ /30/ /14/ /28/ /11/ /25/ /09/ /23/ /06/ /20/2009 Delivery Replenishment Distribution Capacity Delivery Replenishment Distribution Capacity 2009 Investor Conference 110

111 Segmentation CHANNEL CATEGORY SEGMENT DELIVERY Agriculture Residential Commercial Feed & Grain Other Farm Services Appliances/Electronics Furniture/Specialty Building Materials Construction Business Pooling REPLENISHMENT Retail Food Services Automotive Medical Specialty / Apparel General / Discount Convenience / Drug Grocery Restaurant / Institutions Dealers Auto Repair Stores TBD SPECIALTY Mfg. / Industrial Bulk Government Paper / Packaging Consumer Goods Beverage Chemical Raw Materials Finished Product TBD 2009 Investor Conference 111

112 Category Mix 2,000 1, M09 1,600 1,400 TRACTORS 1,200 1, Retail Food Delivery Construction Mfg. / Industrial Bulk / Chemical Agriculture Automotive Specialty 2009 Investor Conference 112

113 Food Services - Restaurant 4 Six Restaurant Service Centers 4 2,600+ restaurant Puyallup, WA drivers Danville, IL dual-temp reefer trailers with lift gates 4 Single-source Tracy, CA Buena Park, CA Phoenix, AZ Dallas, TX 4 5-year contract; Annual spend exceeds $25 million 2009 Investor Conference 113

114 Growth Opportunity - Food GROCERY FOOD SERVICE RESTAURANT 2009 Investor Conference 114

115 Agricultural Services REVENUE +30% CAGR since 2007 $30.0 $25.0 $20.0 $15.0 $10.0 $5.0 $ E 2009 Investor Conference 115

116 2009 Investor Conference 116

117 Crossdocking (Visual) 2009 Investor Conference 117

118 Crossdocking (Defined) 4 A logistics technique used to rapidly consolidate shipments from disparate sources and realize economies of scale in outbound transportation 4 The idea is to transfer incoming shipments directly to outgoing trailers without storing them in between 4 This eliminates the inventory-holding function of a warehouse 4 Shipments typically spend less than 24 hours at the facility, sometimes less than an hour 4 Goods arriving from a vendor already have a customer assigned already have a customer assigned, so workers need only move the shipment across the dock from the inbound trailer to an outbound trailer 2009 Investor Conference 118

119 Delivery Network Implementation 4 Current Position: (75% complete) h Facilities 63 h Straight Trucks 231 h Daycabs 202 h Square Footage 836,668 h Annual Revenue - $111.2 million 4 EOY 2009: (93% complete) h Facilities 80 h Straight Trucks 271 h Daycabs 244 h Square Footage 963,297 h Annual Revenue $131.6 million 4 Remaining 6 buildings h On-boarded 1 st Quarter 2010 h Total Annual Revenue - $147.9 million h Total Square Footage 1,032, Investor Conference 119

120 Private Fleet Market Opportunity BDE Location Private Fleets 2009 Investor Conference 120

121 Differentiation Defined 2009 Investor Conference 121

122 J.B. Hunt Intermodal November 5, 2009

123 JBI Value Proposition Private Equipment J.B. Hunt Intermodal IMCs Modal / Segment Indifferent Introductory Service for Other Business Segments Operational Integration with Other Segments Long-term Network Sustainable Rail Contracts Company Dray Operation Chassis Ownership 2009 Investor Conference 123

124 Loads Intermodal Division Loads 950, , , , , , , , , , , , , , , , , , OCT YTD 2009 OCT YTD 2009 Investor Conference 124

125 Operating Revenue Intermodal Division Operating Revenue (incl FSC) $Million $2,400 $2,200 $2,000 1,951.7 $1,800 1,652.8 $1,600 $1,400 $1,200 $1,000 $ , , , , ,272.4 $ SEP YTD 2009 SEP YTD 2009 Investor Conference 125

126 State of the Industry 4 IM Industry rail shipments have declined 17% September YTD h BNSF 4IM volume down 22% 4Revenue down 36% h UP 4IM volume down 13% 4Revenue down 22% h CSX 4IM volume down 10% 4Revenue down 24% h NS 4IM volume down 19%, 4Revenue down 31% JB Hunt Pacer Hub JB Hunt Pacer Hub Quarter Volume Revenue +6% $391 MM -20% $358 MM -5% $246 MM Quarter Volume Revenue +8% $425 MM -20% (e) $377 MM -10% $254 MM Quarter Oper. Inc. $41 MM ($184) MM $6 MM Oper. Inc. $45 MM ($12) MM $8 MM Volume Revenue Oper. Inc. JB Hunt Pacer Hub +9% Negative -9% $455 MM $50 MM $315 MM $5 MM $270 MM $10 MM 2009 Investor Conference 126

127 EOY Truck Count Intermodal Division EOY Truck Count 2, % Increase 2010E vs. 2009E 2,396 2,400 2,124 2,289 2,000 1,795 1,600 1, ,047 1,192 1,341 1, E 2010E 2009 Investor Conference 127

128 Containers Intermodal Division JBI Containers 50, % Increase 2010E vs. 2009E 43,783 40,000 34,019 39,161 41,233 30,000 27,622 20,000 18,711 19,672 20,879 22,210 23,755 10, E 2010E 2009 Investor Conference 128

129 2009 Investor Conference 129

130 Customers Utilize Our Multiple Offerings 413 of our top-20 customers use all of our services 420 of our top-20 customers use our Intermodal service 448 of our top-50 customers use our Intermodal service 493 of our top-100 customers use our Intermodal service Top-20 Customers: Revenue by Segment JBI DCS ICS JBT 0% 20% 40% 60% 80% 100% 2009 Investor Conference 130

131 Dray Fleet - What Makes JBI Different? Superior Dray Operations for pick-up and deliveries 4 Over 2,700 uniformed company drivers and 2,300 company-owned tractors service locations with a mix of local and regional drivers 4 Average of 8+ yrs of experience 4 Outstanding Safety Record (ATA safest local carrier over 20 mm) 4 Experienced, local based management teams 4 Over 87% of Intermodal dray moves performed by company drivers 4 Network of 165 qualified, safe partner carriers used for outsourcing 4 On-board computer technology for timely updates 4 Average Age of Tractor Fleet < 2.5 yrs 4 Light Weight Equipment 4 Lower Emission Engines 2009 Investor Conference 131

132 NEW California Requirements (2010) Truck & Bus Regulation Tractors that ENTER a port or rail yard Diesel-fueled tractors with a gross vehicle weight rating (GVWR) greater than 33,000 pounds that enter California ports or intermodal rail yards must retrofit and/or upgrade existing tractors. Tractors that DO NOT enter a port or rail yard Diesel trucks and buses with a GVWR over 14,000 pounds must retrofit and/or upgrade existing tractors. Greenhouse Gas Regulation Tractor & Trailer 53-foot or longer box-type trailers, including both dry-van and refrigerated-van trailers, and all heavy-duty tractors that pull them on California highways Investor Conference 132

133 Truck & Bus Regulation 2009 Investor Conference 133

134 Chassis Fleet What Makes JBI Different? 4Not dependent on 3 rd party for chassis balance 4Not dependent on other carriers to free up chassis 4Mutually exclusive equipment so no other carriers can utilize JBH chassis 4 Masters of our own destiny 4Allows JBI to run chassis ratio below 1: Investor Conference 134

135 More Customers, More Places 4 ICS does more for us than meets the eye ICS Intermodal Loads % % E 2009 Investor Conference 135

136 DCS Powered - JBI Stops Intermodal Division DCS % of JBI Stops 100,000 90,000 80,000 70,000 DCS Stops % of JBI Sops 7.0% 6.0% 5.0% 60,000 50,000 40, % 3.0% 30,000 20,000 10, % 1.0% E 2010B 0.0% 2009 Investor Conference 136

137 2009 Investor Conference 137

138 Intermodal Pricing 4Pricing is the biggest lever on margins 460% re-priced in % potential re-price in $12 billion of potential intermodal volume in bids h Includes truck conversion opportunities 4Approx. 60% of total business could re-price if conditions improve ($1 billion) 2009 Investor Conference 138

139 2009 Rail PTE Distribution NS 19% Others 5% BNSF 76% Based on data from 3 rd quarter, Investor Conference 139

140 Rail Partnerships What Makes JBI Different? Exclusive partnership with the BNSF 4Unique economic arrangement which focuses both parties on cost reduction and operational efficiency 4JBH has numerous advantages on BNSF that no other intermodal provider receives: h Highest loading priority for premium and expedited trains h Complete pricing autonomy h Dray fleet and dispatch personnel located at or immediately adjacent to rail ramp h JBI volumes large enough to drive service design changes and new lane creation h Contract survives change of control 2009 Investor Conference 140

141 On-Time Service Performance BNSF Performance NS Performance 100% 80% 90% 70% 80% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% YTD 0% YTD 2009 Investor Conference 141

142 Growth and Diversification Opportunities 4Refrigerated Intermodal hidentified Refrigerated potential 1.1 million highway loads hcontainers vs. Trailers an Opportunity 4New Sales channels.. hics 38,000 loads up 65% hspot business ( mainly 3PL s) up 20% 2009 Investor Conference 142

143 Eastern Network Convertible OTR Volumes & Length of Haul Loads/ Year 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000, ,000 0 JBH + Bid OTR Combined 25% 20% 15% 10% 5% 0% LOH Breakdown for Solution 2009 Investor Conference 143

144 Eastern vs. Transcon Load Growth Intermodal Division Eastern vs. Transcon Loads EASTERN TRANSCON 700, , , , , , , , , , , , , ,000-89, ,447 15% 16% 142,208 19% 25% 28% E 2009 Investor Conference 144

145 Executive Bios November 5, 2009

146 Executive Bios Kirk Thompson President and Chief Executive Officer Mr. Thompson, a Certified Public Accountant, joined the Company in 1973 and was elected to the Board in He served as Vice President of Finance from 1979 until 1984, Executive Vice President and Chief Financial Officer until 1985, and President and Chief Operating Officer from 1986 until 1987, when he was elected President and Chief Executive Officer. Paul Bergant Executive Vice President, Chief Marketing Officer and President, Intermodal Mr. Bergant joined the Company in 1978 as General Counsel and currently serves as EVP, Chief Marketing Officer and President of our Intermodal business segment. Prior to joining the Company, he worked for the Kansas Corporation Committee as Assistant General Counsel and with a private law practice in Chicago, IL. Craig Harper Executive Vice President, Operations and Chief Operating Officer Mr. Harper joined the Company in 1992 as Vice President of Marketing and currently serves as EVP, Operations and Chief Operations Officer. Prior to joining the Company, he worked for Rineco Chemical Industries as its Chief Executive Officer Investor Conference 146

147 Executive Bios Terrence Matthews Executive Vice President, Sales and Marketing Mr. Matthews joined the Company in 1986 as a National Accounts Manager and currently serves as EVP of Sales and Marketing for our Truck and Intermodal business segments. Prior to joining the Company, he worked as a National Accounts Manager for North American Van Lines. David Mee Executive Vice President, Finance/Administration and Chief Financial Officer Mr. Mee, a Certified Public Accountant, joined the Company in 1992 as Vice President, Tax and Risk Management and currently serves as Chief Financial Officer. Prior to joining the Company, he was a Senior Tax Manager for KPMG LLP. Kay Palmer Executive Vice President, IT/Engineering and Chief Information Officer Ms. Palmer joined the Company in 1988 as a Program Analyst of Finance and currently serves as EVP of Information Technology and Engineering and Chief Information Officer. Prior to joining the Company, she worked at EDS as a Systems Engineer Manager Investor Conference 147

148 Executive Bios John Roberts Executive Vice President and President, Dedicated Contract Services Mr. Roberts joined the Company in 1989 as a Management Trainee and currently serves as EVP and President of Dedicated Contract Services. Prior to his appointment as President of DCS in 1997, he served as Vice President of Marketing Strategy where he played a key role in the evolution of the company s strategic direction for all business units. Shelley Simpson Executive Vice President and President, Integrated Capacity Solutions Ms. Simpson joined the Company in 1994 and has served in various positions in Customer Service, Pricing and Finance and currently serves as President of Integrated Capacity Solutions. Prior to her appointment as President of ICS in 2007, she worked as SVP of Economic Analysis Investor Conference 148