MARTEN TRANSPORT, LTD.
2020 Annual Report
Who We Are
Marten Transport, Ltd ., with headquarters in Mondovi,
Wisconsin, strives to be the premier supplier of time and tem-
perature-sensitive and dry transportation and distribution services
to customers in the United States, Canada and Mexico . We have
strategically transitioned from a long-haul carrier to a multifac-
eted business offering a network of truck-based transportation
capabilities across our five distinct business platforms .
Truckload – regional and over-the-road fleets, both tempera-
ture-controlled and dry van, operating from Marten’s 15 regional
service centers .
Dedicated – customized solutions tailored to each individual cus-
tomer’s requirements utilizing refrigerated trailers, dry vans and
other specialized equipment .
Intermodal – refrigerated COFC (container on flatcar) and
refrigerated TOFC (trailer on flatcar) services, providing the
economies and energy efficiencies of long-haul rail transportation
with extended door-to-door support from Marten’s truck network .
Brokerage – surge flexibility to supplement Marten’s capabilities
through temperature-controlled and dry van services provided by
smaller third-party carriers .
MRTN de México – industry-leading door-to-door tempera-
ture-controlled service between Mexico, the U .S . and Canada
utilizing our Mexican partner carriers within Mexico .
We will accomplish our mission by exceeding the expectations
of our customers, employees, stockholders and society . We serve
customers with demanding delivery deadlines, as well as those who
ship products requiring modern temperature-controlled trailers to
protect goods .
Founded in 1946, we have been a public company since 1986 . Our
common stock trades on the NASDAQ Global Select Market
under the symbol MRTN . At December 31, 2020, we employed
4,162 people, including drivers, office personnel and mechanics .
Five-Year Financial Summary
(Dollars in thousands, except per share amounts)
2020
2019
Years ended December 31,
2018
2017
FOR THE YEAR
Operating revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income – excluding 2017 deferred income taxes benefit(1) .
Operating ratio(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 874,374
93,246
69,500
69,500
$ 843,271
76,498
61,071
61,071
$ 787,594
70,348
55,027
55,027
$ 698,120
56,862
90,284
33,819
89.3%
90 .9%
91 .1%
91 .9%
91 .3%
2016
$ 671,144
58,303
33,464
33,464
PER-SHARE DATA(3)
Basic earnings per common share . . . . . . . . . . . . . . . . . . . . . . $
Basic earnings per common share – excluding 2017 deferred
income taxes benefit(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Diluted earnings per common share . . . . . . . . . . . . . . . . . . . .
Diluted earnings per common share – excluding 2017
deferred income taxes benefit(1) . . . . . . . . . . . . . . . . . . . . . . .
Dividends declared per common share . . . . . . . . . . . . . . . . . .
Book value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.84
$
0 .75
$
0 .67
$
1 .10
$
0 .41
0.84
0.84
0.84
0.633
7.50
0 .75
0 .74
0 .74
0 .513
7 .28
0 .67
0 .67
0 .67
0 .067
7 .05
0 .41
1 .10
0 .41
0 .053
6 .43
0 .41
0 .41
0 .41
0 .04
5 .36
AT YEAR END
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 831,636
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
–
620,333
Stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 796,586
–
597,589
$ 753,904
–
575,954
$ 690,403
–
525,500
$ 653,748
7,886
437,338
(1) Net income and basic and diluted earnings per common share for 2017 are presented for comparative purposes excluding the $56 .5 million deferred
income taxes benefit recorded to recognize the impact on our federal net deferred tax liability of the reduction of the federal corporate statutory income
tax rate from 35% to 21% related to the Tax Cuts and Jobs Act of 2017 .
(2) Represents operating expenses as a percentage of operating revenue .
(3) The amounts for 2016 through 2019 have been restated to reflect the three-for-two stock split effected in the form of a 50% stock dividend on August 13,
2020 and the five-for-three stock split effected in the form of a 662⁄3% stock dividend on July 7, 2017 .
Note: We account for our revenue in accordance with FASB ASC 606, which we adopted on January 1, 2018 using the modified retrospective method .
Prior years have not been restated and continue to be reported under the accounting standards in effect for those periods .
To Our Stockholders and Employees
Because of the COVID-19 pandemic, 2020 was in many ways
one of the most challenging years in Marten’s 75-year history—
and, despite the pandemic, it was in many ways our most suc-
cessful . Our 2020 operating revenue and operating income were
the highest for any year in our history . Our 2020 improvement
in operating income was 21 .9%, on top of increases of 8 .7% in
2019 and 23 .7% in 2018 .
Marten’s 13 .8% increase in net income for 2020 was our
fourth consecutive improvement in annual earnings, excluding
a deferred income taxes benefit in 2017 . Our operating ratio,
net of fuel surcharges, was the best since we became a public
company in 1986 .
Operating Results Comparison
Percentage Change, Year Ended December 31,
2020 vs. 2019
2019 vs. 2018
2018 vs. 2017
Operating revenue
3.7%
7.1%
12.8%
Operating revenue,
net of fuel surcharges
Operating income
Net income
6.8%
21.9%
13.8%
8.6%
8.7%
11.0%
8.0%
23.7%
62.7%
Net income used to calculate the percentage increase from 2017 to 2018
excludes a $56.5 million deferred income tax benefit in the fourth quarter of
2017.
The Marten Difference
Celebrating Seventy-Five Years
As in 2018 and 2019, our 2020 results offer a clear measure
of the Marten difference, a difference created and sustained
through a unique business model in the hands of a dedicated
and experienced national team supporting the industry’s finest
professional driver group .
Our operating model has been developed to continuously
provide the best, most-efficient service for our diverse and
growing customer base . This focused effort has transformed
Marten from a leading over-the-road temperature-controlled
carrier into a national network of truck-based transportation
capabilities . It is a multifaceted approach utilizing five distinct
yet complementary business platforms – Truckload, Dedicated,
Intermodal, Brokerage and MRTN de México .
We have successfully moved from a centralized business plat-
form to a decentralized operation across 15 regional centers .
This regional platform provides the foundation for consistent,
profitable growth through ever-changing business environ-
ments . Our operating model made possible the rapid develop-
ment of our Dedicated business and its 85 .6% revenue growth
over the past three years, a reflection of this operation’s mutu-
ally supportive interaction with our regional Truckload and
Brokerage resources . In a relatively short time, our Dedicated
business has developed into an industry leader operating over
1,600 trucks . Our Walmart Dedicated fleet was honored as the
2019 Walmart Grocery Dedicated Carrier of the Year .
Credit for the success of our transformational business model
goes to the national team of people who execute it in their
continuous drive for cost and productivity improvements . The
emphasis on continuous improvement is part of our culture—a
no-excuses, get-it-done culture focused on working smart and
hard as a team . Central to this is our data-driven mentality
backed by an in-house, state-of-the art information technol-
ogy system providing real-time visibility of the data needed to
quickly make decisions for improved supply chain productivity .
The contrast between the vehicles
shown on the cover is symbolic of the
transformation Marten Transport has
undergone since its founding 75 years
ago . The truck in the lower photo
was the company’s first, bought by
Roger Marten to launch Marten Transport in 1946 . The
technology-enhanced tractor and trailer shown in the
upper photo are part of a fleet of more than 3,300 tractors
and 5,300 trailers currently operated by Marten .
From one man and one truck, Marten has transformed
itself into today’s multifaceted network of refrigerated
and dry truck-based transportation capabilities with 15
regional centers across the nation and more than 4,100
employees whose ability to work as a team is reflected in
Marten’s consistent profitable growth .
2020 Financial Results
Net income for 2020 was $69 .5 million, or 84 cents per diluted
share, up 13 .8% from $61 .1 million, or 74 cents per diluted
share, for 2019 .
Operating revenue improved 3 .7% to a record $874 .4 million
for 2020 from $843 .3 million for 2019 . Excluding fuel surcharg-
es, 2020 operating revenue improved 6 .8% to $790 .6 million
from $739 .9 million for 2019 .
Operating income improved 21 .9% to a record $93 .2 million for
2020 from $76 .5 million for 2019 . Our operating ratio (oper-
ating expenses as a percentage of operating revenue) improved
to 89 .3% for 2020 from 90 .9% for 2019 . Our ratio, net of fuel
surcharges, improved to 88 .2% from 89 .7% .
Each of our five business platforms continues to play an import-
ant role in the implementation of Marten’s strategic vision and
MARTEN TRANSPORT 2020 ANNUAL REPORT
plan, both individually and through collaborative interaction .
Truckload – Truckload revenue increased to $379 .1 million
from $378 .0 million for 2019 . Excluding fuel surcharges,
Truckload revenue was $342 .4 million, a 4 .0% increase from
$329 .3 million for 2019 . Average revenue, net of fuel surcharg-
es, per tractor per week, a main measure of Truckload asset
productivity, improved by 3 .4% . Operating income was $39 .6
million, up 33 .6% from $29 .7 million for 2019 . The 2020
Truckload operating ratio improved to 89 .5% from 92 .2% in
2019, and the 2020 ratio, net of fuel surcharges, was 88 .4% .
Dedicated – Dedicated revenue increased 16 .5% to $309 .8 mil-
lion from $266 .0 million for 2019 . Excluding fuel surcharges,
Dedicated revenue improved 21 .3% to $271 .6 million from
$223 .9 million for 2019 . The average number of tractors in
service grew 23 .1% to 1,566 from 1,272 in 2019 . Operating
income was $40 .9 million, a 30 .9% increase from $31 .2 mil-
lion for 2019 . The 2020 Dedicated operating ratio improved
to 86 .8% from 88 .3% in 2019, and the 2020 ratio, net of fuel
surcharges, was 84 .9% .
Intermodal – Intermodal revenue declined to $88 .7 million
from $90 .4 million for 2019 . Excluding fuel surcharges, 2020
Intermodal revenue was $79 .9 million, up from $77 .8 million
in 2019 . Operating income was $5 .7 million, down from $6 .6
million for 2019 . The 2020 Intermodal operating ratio was
93 .5%, and the ratio, net of fuel surcharges, was 92 .8% .
Brokerage – Marten’s Brokerage revenue declined to $96 .7 mil-
lion from $108 .9 million for 2019 . Brokerage operating income
was $7 .0 million for 2020 versus $9 .0 million for 2019 . The
Brokerage operating ratio was 92 .8% for 2020 .
MRTN de México – Operating within our Truckload and
Brokerage segments, another profitable component of Marten’s
vision and plan is MRTN de México . Its 2020 revenue was
$60 .1 million .
Operating Environment
COVID-19 created both a health crisis and an economic
crisis—and the most aberrational operating environment for
transportation companies in memory . The flexibility designed
into the Marten model gives us an edge in this turbulent
environment . Our data-driven decision-making enables us to
respond swiftly to the churning levels of each individual cus-
tomer’s freight demand created by the economic crisis .
We embrace our responsibility to keep our employees safe and
healthy as they each contribute to transporting and distributing
the food, beverages and other consumer goods essential to
millions of people in North America . This includes providing
masks and hand sanitizer, increasing the frequency and extent
of cleaning to our facilities and tractors, and modifying our
MARTEN TRANSPORT 2020 ANNUAL REPORT
facilities for improved social distancing . When sanitizer was
generally unavailable early on, we bought barrels of the ingre-
dients and made our own, distributing over 6,000 bottles to
our people .
The intensifying national driver shortage remains a major
issue, though Marten has built a distinct competitive edge in
recruiting and retaining top drivers . We’ve led the way with
continued improvements to our aggressive levels of compen-
sation and benefits, safety and technology . Our tractors are
the safest available, featuring radar-based collision avoidance,
lane departure and blind spot detection systems along with
forward-facing cameras . We are the last of the major carriers to
hire only experienced drivers .
Reflecting Marten’s continued strong financial position, our
Board of Directors effected a three-for-two stock split of our
common stock in August . This was Marten’s third stock split
since the Great Recession, following a five-for-three split in
2017 and a three-for-two split in 2013 . We paid a special cash
dividend in December of 50 cents per share along with our
regular quarterly cash dividend of 4 cents per share, our for-
ty-second consecutive quarterly cash dividend . We have paid
a total of $138 .3 million in cash dividends since the program
was implemented in 2010, including $42 .1 million in 2019 and
$52 .4 million in 2020 .
We’re proudly observing Marten’s 75th anniversary, and
proudly reporting how our unique business model is keeping
a 75-year-old company new . Marten began as a one-man milk
truck operation in rural Wisconsin, and has evolved into an
industry-leading multifaceted business providing supply chain
solutions to leading businesses across the country . The disci-
plined execution of our model made the difference in 2020, and
we expect it to continue making a difference in the years ahead .
We believe that 2021 and the coming years will hold even more
opportunities for profitable growth .
Sincerely,
Randolph L . Marten
Chairman of the Board
and Chief Executive Officer
February 15, 2021
This Annual Report contains forward-looking statements that involve risks and
uncertainties that could cause results to differ materially from those projected. Please
refer to the “Risk Factors” section in Item 1A of the attached Form 10-K.
Corporate Information
Corporate Headquarters
129 Marten Street
Mondovi, Wisconsin 54755
Telephone: (715) 926-4216
Fax: (715) 926-4530
www .marten .com
Stockholder Information
Additional copies of our 2020 Annual Report on Form
10-K as filed with the Securities and Exchange Commission
are available by writing to James J . Hinnendael, executive
vice president and chief financial officer, at our corporate
headquarters .
Annual Meeting
Stockholders, employees and friends may attend our annual
meeting on Tuesday, May 4, 2021, at 3:00 p .m . at the Roger
Marten Community Center, 120 South Franklin Street,
Mondovi, Wisconsin .
Stock Listing
NASDAQ Global Select Market symbol: MRTN
Legal Counsel
Fox Rothschild LLP
Campbell Mithun Tower – Suite 2000
222 South Ninth Street
Minneapolis, Minnesota 55402
Independent Registered Public Accounting Firm
Grant Thornton LLP
200 South Sixth Street, Suite 1400
Minneapolis, Minnesota 55402
Transfer Agent and Registrar
Computershare Shareowner Services
Stockholder correspondence mailing address:
P .O . Box 505000
Louisville, Kentucky 40233
Overnight correspondence address:
462 South 4th Street, Suite 1600
Louisville, Kentucky 40202
Telephone: (866) 637-5412
TDD: (800) 231-5469
Foreign: (201) 680-6578
www .computershare .com/investor
Stockholder online inquiries:
www-us .computershare .com/investor/contact
Direct communications about stock certificates or a change
of address to Computershare Shareowner Services .
MARTEN TRANSPORT 2020 ANNUAL REPORT
Executive Officers and Directors
Randolph L. Marten
Chairman of the Board,
Chief Executive Officer and Director
Timothy M. Kohl
President
James J. Hinnendael
Executive Vice President and Chief Financial Officer
John H. Turner
Executive Vice President of Sales and Marketing
Patrick J. Pazderka
Secretary
Partner,
Fox Rothschild LLP
Minneapolis, Minnesota
Larry B. Hagness
Director
Chief Executive Officer,
Durand Builders Service, Inc .
Durand, Wisconsin
Thomas J. Winkel
Director
Management Consultant
Pewaukee, Wisconsin
Jerry M. Bauer
Director
Chairman of the Board and Chief Executive Officer,
Bauer Built, Inc .
Durand, Wisconsin
Robert L. Demorest
Director
Business Consultant and Retired President,
Chief Executive Officer and Chairman of the Board,
MOCON, Inc .
Minneapolis, Minnesota
Ronald R. Booth
Director
Retired Partner,
KPMG LLP
Dellwood, Minnesota
Kathleen P. Iverson
Director
Retired President, Chief Executive Officer and
Chairman of the Board,
CyberOptics Corporation
Chanhassen, Minnesota
The 2020 Annual Report is printed on recycled paper.
MARTEN TRANSPORT 2020 ANNUAL REPORT
MARTEN TRANSPORT, LTD. 129 MARTEN STREET MONDOVI, WISCONSIN 54755 TELEPHONE: (715) 926-4216 FAX: (715) 926-4530 www.marten.com