RYDER SYSTEM INC, 10-Q filed on 7/23/2014
Quarterly Report
Document and Entity Information
6 Months Ended
Jun. 30, 2014
Document and Entity Information [Abstract]
 
Entity Registrant Name
RYDER SYSTEM INC. 
Entity Central Index Key
0000085961 
Document Type
10-Q 
Document Period End Date
Jun. 30, 2014 
Amendment Flag
false 
Document Fiscal Year Focus
2014 
Document Fiscal Period Focus
Q2 
Current Fiscal Year End Date
--12-31 
Entity Filer Category
Large Accelerated Filer 
Entity Common Stock, Shares Outstanding
53,067,722 
Consolidated Condensed Statements of Earnings (Unaudited) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Income Statement [Abstract]
 
 
 
 
Lease and rental revenues
$ 733,763 
$ 688,048 
$ 1,423,445 
$ 1,347,756 
Services revenue
741,427 
707,666 
1,451,126 
1,397,127 
Fuel services revenue
209,381 
208,285 
420,737 
422,133 
Total revenues
1,684,571 
1,603,999 
3,295,308 
3,167,016 
Cost of lease and rental
508,091 
476,662 
1,001,134 
949,739 
Cost of services
625,276 
590,311 
1,231,505 
1,173,900 
Cost of fuel services
203,613 
204,626 
410,818 
414,919 
Other operating expenses
31,007 
32,876 
67,652 
70,475 
Selling, general and administrative expenses
200,430 
195,033 
392,132 
384,106 
Gains on vehicle sales, net
(34,365)
(23,197)
(63,183)
(46,203)
Interest expense
35,302 
33,901 
70,411 
68,355 
Miscellaneous income, net
(4,828)
(3,575)
(10,210)
(8,145)
Total expenses
1,564,526 
1,506,637 
3,100,259 
3,007,146 
Earnings from continuing operations before income taxes
120,045 
97,362 
195,049 
159,870 
Provision for income taxes
44,351 
34,787 
70,257 
56,493 
Earnings from continuing operations
75,694 
62,575 
124,792 
103,377 
Loss from discontinued operations, net of tax
(336)
(381)
(1,202)
(1,259)
Net earnings
$ 75,358 
$ 62,194 
$ 123,590 
$ 102,118 
Earnings (loss) per common share - Basic
 
 
 
 
Continuing operations
$ 1.43 
$ 1.21 
$ 2.36 
$ 2.00 
Discontinued operations
$ 0.00 
$ (0.01)
$ (0.02)
$ (0.02)
Net earnings
$ 1.43 
$ 1.20 
$ 2.34 
$ 1.98 
Earnings (loss) per common share - Diluted
 
 
 
 
Continuing operations
$ 1.42 
$ 1.19 
$ 2.34 
$ 1.98 
Discontinued operations
$ (0.01)
$ 0.00 
$ (0.02)
$ (0.02)
Net earnings
$ 1.41 
$ 1.19 
$ 2.32 
$ 1.96 
Cash dividends declared per common share
$ 0.34 
$ 0.31 
$ 0.68 
$ 0.62 
Consolidated Statements of Comprehensive Income (Unaudited) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Net earnings
$ 75,358 
$ 62,194 
$ 123,590 
$ 102,118 
Other comprehensive income (loss):
 
 
 
 
Changes in cumulative translation adjustment and other, before and after tax
26,273 
(16,239)
11,681 
(49,943)
Amortization of pension and postretirement items
4,295 
8,180 
9,328 
16,534 
Income tax expense related to amortization of pension and postretirement items
(1,302)
(2,782)
(3,208)
(5,717)
Amortization of pension and postretirement items, net of taxes
2,993 
5,398 
6,120 
10,817 
Change in net actuarial loss
(3,144)
(5,762)
(3,144)
(5,762)
Income tax benefit related to change in net actuarial loss
1,096 
2,048 
1,096 
2,048 
Change in net actuarial loss, net of taxes
(2,048)
(3,714)
(2,048)
(3,714)
Other comprehensive loss
27,218 
(14,555)
15,753 
(42,840)
Comprehensive income
$ 102,576 
$ 47,639 
$ 139,343 
$ 59,278 
Consolidated Condensed Balance Sheets (Unaudited) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Current assets:
 
 
Cash and cash equivalents
$ 86,888 
$ 61,562 
Receivables, net of allowance of $17,322 and $16,955, respectively
827,274 
777,370 
Inventories
65,490 
64,298 
Prepaid expenses and other current assets
157,818 
159,263 
Total current assets
1,137,470 
1,062,493 
Revenue earning equipment, net of accumulated depreciation of $3,606,141 and $3,596,102, respectively
6,930,465 
6,490,837 
Operating property and equipment, net of accumulated depreciation of $1,015,764 and $991,117, respectively
687,714 
633,826 
Goodwill
383,879 
383,719 
Intangible assets
69,224 
72,406 
Direct financing leases and other assets
478,915 
460,501 
Total assets
9,687,667 
9,103,782 
Current liabilities:
 
 
Short-term debt and current portion of long-term debt
557,681 
259,438 
Accounts payable
479,952 
475,364 
Accrued expenses and other current liabilities
479,047 
496,337 
Total current liabilities
1,516,680 
1,231,139 
Long-term debt
4,159,472 
3,929,987 
Other non-current liabilities
566,242 
616,305 
Deferred income taxes
1,480,313 
1,429,637 
Total liabilities
7,722,707 
7,207,068 
Shareholders' equity:
 
 
Preferred stock of no par value per share — authorized, 3,800,917; none outstanding, June 30, 2014 or December 31, 2013
0 
0 
Common stock of $0.50 par value per share — authorized, 400,000,000; outstanding, June 30, 2014 — 53,067,722; December 31, 2013 — 53,335,386
26,533 
26,667 
Additional paid-in capital
944,064 
917,539 
Retained earnings
1,416,858 
1,390,756 
Accumulated other comprehensive loss
(422,495)
(438,248)
Total shareholders' equity
1,964,960 
1,896,714 
Total liabilities and shareholders' equity
$ 9,687,667 
$ 9,103,782 
Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Assets:
 
 
Accumulated depreciation on revenue earning equipment
$ 3,606,141 
$ 3,596,102 
Accumulated depreciation on operating property and equipment
1,015,764 
991,117 
Allowance for doubtful accounts, current
$ 17,322 
$ 16,955 
Shareholders' equity:
 
 
Preferred stock, par value
$ 0 
$ 0 
Preferred stock, shares authorized
3,800,917 
3,800,917 
Preferred stock, shares outstanding
0 
0 
Common stock, par value
$ 0.5 
$ 0.5 
Common stock, shares authorized
400,000,000 
400,000,000 
Common stock, shares outstanding
53,067,722 
53,335,386 
Consolidated Condensed Statements of Cash Flows (Unaudited) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Cash flows from operating activities from continuing operations:
 
 
Net earnings
$ 123,590 
$ 102,118 
Less: Loss from discontinued operations, net of tax
(1,202)
(1,259)
Earnings from continuing operations
124,792 
103,377 
Depreciation expense
505,997 
465,979 
Gains on vehicle sales, net
(63,183)
(46,203)
Share-based compensation expense
9,989 
9,602 
Amortization expense and other non-cash charges, net
25,727 
27,289 
Deferred income tax expense
59,956 
48,176 
Changes in operating assets and liabilities, net of acquisitions:
 
 
Receivables
(40,579)
(16,591)
Inventories
(1,178)
2,089 
Prepaid expenses and other assets
(19,163)
(17,392)
Accounts payable
1,771 
23,708 
Accrued expenses and other non-current liabilities
(67,629)
(36,257)
Net cash provided by operating activities from continuing operations
536,500 
563,777 
Cash flows from financing activities from continuing operations:
 
 
Net change in commercial paper borrowings
21,377 
180,777 
Debt proceeds
765,713 
254,371 
Debt repaid, including capital lease obligations
(271,248)
(320,862)
Dividends on common stock
(35,915)
(32,055)
Common stock issued
34,129 
41,428 
Common stock repurchased
(79,488)
0 
Excess tax benefits from share-based compensation
411 
3,289 
Debt issuance costs
(5,026)
(2,008)
Net cash provided by financing activities from continuing operations
429,953 
124,940 
Cash flows from investing activities from continuing operations:
 
 
Purchases of property and revenue earning equipment
(1,255,222)
(948,114)
Sales of revenue earning equipment
274,394 
225,749 
Sales of operating property and equipment
2,780 
3,296 
Acquisitions
(1,649)
(1,420)
Collections on direct finance leases
32,355 
39,854 
Changes in restricted cash
8,774 
(15,142)
Insurance recoveries and other
(1,250)
8,173 
Net cash used in investing activities from continuing operations
(939,818)
(687,604)
Effect of exchange rate changes on cash
48 
6,966 
Increase in cash and cash equivalents from continuing operations
26,683 
8,079 
Cash flows from discontinued operations:
 
 
Operating cash flows
(1,329)
(1,031)
Effect of exchange rate changes on cash
(28)
(11)
Decrease in cash and cash equivalents from discontinued operations
(1,357)
(1,042)
Increase in cash and cash equivalents
25,326 
7,037 
Cash and cash equivalents at January 1
61,562 
66,392 
Cash and cash equivalents at June 30
$ 86,888 
$ 73,429 
Consolidated Condensed Statement of Shareholders' Equity (Unaudited) (USD $)
In Thousands, except Share data, unless otherwise specified
Total
Preferred Stock
Common Stock
Additional Paid-In Capital
Retained Earnings
Accumulated Other Comprehensive Loss
Beginning Balance at Dec. 31, 2013
$ 1,896,714 
$ 0 
$ 26,667 
$ 917,539 
$ 1,390,756 
$ (438,248)
Beginning Balance, shares at Dec. 31, 2013
53,335,386 
 
53,335,386 
 
 
 
Components of comprehensive income:
 
 
 
 
 
 
Net earnings
123,590 
 
 
 
123,590 
 
Other comprehensive income
15,753 
 
 
 
 
15,753 
Comprehensive income
139,343 
 
 
 
 
 
Common stock dividends declared — $0.68 per share
(36,158)
 
 
 
(36,158)
 
Common stock issued under employee stock option and stock purchase plans1
33,678 
 
377 
33,301 
 
 
Common stock issued under employee stock option and stock purchase plans, shares1
 
 
753,684 
 
 
 
Benefit plan stock sales2
451 
 
3 
448 
 
 
Benefit plan stock sales, shares2
 
 
5,724 
 
 
 
Common stock repurchases
(79,488)
 
(514)
(17,644)
(61,330)
 
Common stock repurchases, shares
 
 
(1,027,072)
 
 
 
Share-based compensation
9,989 
 
 
9,989 
 
 
Tax benefits from share-based compensation
431 
 
 
431 
 
 
Ending Balance at Jun. 30, 2014
1,964,960 
0 
26,533 
944,064 
1,416,858 
(422,495)
Ending Balance, shares at Jun. 30, 2014
53,067,722 
 
53,067,722 
 
 
 
Beginning Balance at Mar. 31, 2014
 
 
 
 
 
 
Components of comprehensive income:
 
 
 
 
 
 
Net earnings
75,358 
 
 
 
 
 
Other comprehensive income
27,218 
 
 
 
 
 
Comprehensive income
102,576 
 
 
 
 
 
Common stock repurchases, shares
 
 
(464,389)
 
 
 
Ending Balance at Jun. 30, 2014
$ 1,964,960 
$ 0 
$ 26,533 
 
 
 
Ending Balance, shares at Jun. 30, 2014
53,067,722 
 
53,067,722 
 
 
 
Consolidated Condensed Statement of Shareholders' Equity (Unaudited) (Parenthetical)
6 Months Ended
Jun. 30, 2014
Cash dividends declared per common share
$ 0.68 
Retained Earnings
 
Cash dividends declared per common share
$ 0.68 
Interim Financial Statements
INTERIM FINANCIAL STATEMENTS
INTERIM FINANCIAL STATEMENTS

The accompanying unaudited Consolidated Condensed Financial Statements include the accounts of Ryder System, Inc. (Ryder) and all entities in which Ryder has a controlling voting interest (“subsidiaries”) and variable interest entities (VIEs) required to be consolidated in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). The accompanying unaudited Consolidated Condensed Financial Statements have been prepared in accordance with the accounting policies described in our 2013 Annual Report on Form 10-K and should be read in conjunction with the Consolidated Financial Statements and notes thereto. These financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement have been included and the disclosures herein are adequate. The operating results for interim periods are unaudited and are not necessarily indicative of the results that can be expected for a full year.

Certain amounts have been reclassified to conform to the current period presentation, including intercompany profit allocations between Fleet Management Solutions (FMS) and Supply Chain Solutions (SCS). These reclassifications were immaterial to the financial statements taken as a whole.
Accounting Changes
RECENT ACCOUNTING PRONOUNCEMENTS [Text Block]
ACCOUNTING CHANGES

Revenue Recognition

In May 2014, the Financial Accounting Standards Board (FASB) issued accounting guidance on the recognition of revenue from contracts with customers. Under the new standard, revenue will be measured and recognized using a performance obligation approach. The guidance will be effective on January 1, 2017. We are currently evaluating the impact of this guidance on our consolidated financial position and results of operations.

Unrecognized Tax Benefits

In July 2013, the FASB issued accounting guidance on the balance sheet presentation of an unrecognized tax benefit when a net operating loss carryforward exists. Under this guidance, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward. This guidance became effective on January 1, 2014 and resulted in a reclassification of $38.8 million from other non-current liabilities to deferred income taxes in our December 31, 2013 balance sheet. Other than the change in presentation within the Consolidated Condensed Balance Sheets, this accounting guidance did not have an impact on our consolidated financial position, results of operations or cash flows.
Discontinued Operations
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS

In 2009, we ceased SCS service operations in Brazil, Argentina, Chile and European markets. Accordingly, results of these operations, financial position and cash flows are separately reported as discontinued operations for all periods presented either in the Consolidated Condensed Financial Statements or notes thereto.

Summarized results of discontinued operations were as follows:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Pre-tax loss from discontinued operations
$
(323
)
 
(298
)
 
$
(1,278
)
 
(1,199
)
Income tax (expense) benefit
(13
)
 
(83
)
 
76

 
(60
)
Loss from discontinued operations, net of tax
$
(336
)
 
(381
)
 
$
(1,202
)
 
(1,259
)


Results of discontinued operations in 2014 and 2013 reflected losses related to adverse legal developments and professional and administrative fees associated with our discontinued South American operations.


The following is a summary of assets and liabilities of discontinued operations:
 
June 30,
2014
 
December 31,
2013
 
(In thousands)
Total assets, primarily deposits
$
3,452

 
3,627

Total liabilities, primarily contingent accruals
$
4,476

 
4,501



Although we discontinued our South American operations in 2009, we continue to be party to various federal, state and local legal proceedings involving labor matters, tort claims and tax assessments. We have established loss provisions for any matters where we believe a loss is probable and can be reasonably estimated. For matters where a reserve has not been established and for which we believe a loss is reasonably possible, as well as for matters where a reserve has been recorded but for which an exposure to loss in excess of the amount accrued is reasonably possible, we believe that such losses will not have a material effect on our consolidated financial statements.

In Brazil, we were assessed $5.3 million (before and after tax) in prior years for various federal income taxes and social contribution taxes for the 1997 and 1998 tax years. We have successfully overturned these federal tax assessments in the lower courts; however, there is a reasonable possibility that these rulings could be reversed and we would be required to pay the assessments. We believe it is more likely than not that our position will ultimately be sustained if appealed and no amounts have been reserved for these matters. We are entitled to indemnification for a portion of any resulting liability on these federal tax claims which, if honored, would reduce the estimated loss.
Share-Based Compensation Plans
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS

Share-based incentive awards are provided to employees under the terms of various share-based compensation plans (collectively, the “Plans”). The Plans are administered by the Compensation Committee of the Board of Directors. Awards under the Plans principally include at-the-money stock options, nonvested stock and cash awards. Nonvested stock awards include grants of market-based, performance-based, and time-vested restricted stock rights. Under the terms of our Plans, dividends may be paid on our nonvested stock awards. Dividends on nonvested stock granted after 2011 are not paid unless the award vests. Upon vesting, the amount of the dividends paid is equal to the aggregate dividends declared on common shares during the period from the date of grant of the award until the date the shares underlying the award are delivered.

The following table provides information on share-based compensation expense and income tax benefits recognized during the periods:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Stock option and stock purchase plans
$
2,241

 
2,193

 
$
4,478

 
4,303

Nonvested stock
2,890

 
2,799

 
5,511

 
5,299

Share-based compensation expense
5,131

 
4,992

 
9,989

 
9,602

Income tax benefit
(1,713
)
 
(1,640
)
 
(3,389
)
 
(3,327
)
Share-based compensation expense, net of tax
$
3,418

 
3,352

 
$
6,600

 
6,275



The following table is a summary of compensation expense recognized for market-based cash awards in addition to the share-based compensation expense reported in the previous table:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Cash awards
$
743

 
889
 
$
1,266

 
2,163


Total unrecognized pre-tax compensation expense related to all share-based compensation arrangements at June 30, 2014 was $33.4 million and is expected to be recognized over a weighted-average period of 2.0 years.

The following table is a summary of the awards granted under the Plans during the periods presented:
 
 
June 30,
2014
 
June 30,
2013
 
 
(In thousands)
 
 
Stock options
 
405

 
381

Market-based restricted stock rights
 
22

 
22

Performance-based restricted stock rights
 
30

 
15

Time-vested restricted stock rights
 
158

 
146

Total
 
615

 
564

Earnings Per Share
EARNINGS PER SHARE
EARNINGS PER SHARE

We compute earnings per share using the two-class method. The two-class method of computing earnings per share is an earnings allocation formula that determines earnings per share for common stock and any participating securities according to dividends declared (whether paid or unpaid) and participation rights in undistributed earnings. Our nonvested stock granted prior to 2012 and restricted stock units granted to our Board of Directors are considered participating securities since these share-based awards contain a non-forfeitable right to dividend cash payments prior to vesting. Under the two-class method, earnings per common share are computed by dividing the sum of distributed earnings and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, undistributed earnings are allocated to both common shares and participating securities based on the weighted average shares outstanding during the period.

The following table presents the calculation of basic and diluted earnings per common share from continuing operations:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands, except per share amounts)
Earnings per share — Basic:
 
 
 
 
 
 
 
Earnings from continuing operations
$
75,694

 
62,575

 
$
124,792

 
103,377

Less: Distributed and undistributed earnings allocated to nonvested stock
(301
)
 
(556
)
 
(582
)
 
(978
)
Earnings from continuing operations available to common shareholders — Basic
$
75,393

 
62,019

 
$
124,210

 
102,399

 
 
 
 
 
 
 
 
Weighted average common shares outstanding — Basic
52,564

 
51,445

 
52,612

 
51,201

 
 
 
 
 
 
 
 
Earnings from continuing operations per common share — Basic
$
1.43

 
1.21

 
$
2.36

 
2.00

 
 
 
 
 
 
 
 
Earnings per share — Diluted:
 
 
 
 
 
 
 
Earnings from continuing operations
$
75,694

 
62,575

 
$
124,792

 
103,377

Less: Distributed and undistributed earnings allocated to nonvested stock
(299
)
 
(552
)
 
(578
)
 
(972
)
Earnings from continuing operations available to common shareholders — Diluted
$
75,395

 
62,023

 
$
124,214

 
102,405

 
 
 
 
 
 
 
 
Weighted average common shares outstanding — Basic
52,564

 
51,445

 
52,612

 
51,201

Effect of dilutive equity awards
482

 
478

 
472

 
457

Weighted average common shares outstanding — Diluted
53,046

 
51,923

 
53,084

 
51,658

 
 
 
 
 
 
 
 
Earnings from continuing operations per common share — Diluted
$
1.42

 
1.19

 
$
2.34

 
1.98

 
 
 
 
 
 
 
 
Anti-dilutive equity awards not included above
412

 
593

 
314

 
1,003

Revenue Earning Equipment
REVENUE EARNING EQUIPMENT
REVENUE EARNING EQUIPMENT

 
June 30, 2014
 
December 31, 2013
 
Cost
 
Accumulated
Depreciation
 
Net  Book
Value(1)
 
Cost
 
Accumulated
Depreciation
 
Net  Book
Value(1)
 
(In thousands)
Held for use:
 
Full service lease
$
7,699,750

 
(2,564,790
)
 
5,134,960

 
$
7,436,093

 
(2,537,077
)
 
4,899,016

Commercial rental
2,491,695

 
(791,662
)
 
1,700,033

 
2,210,863

 
(747,283
)
 
1,463,580

Held for sale
345,161

 
(249,689
)
 
95,472

 
439,983

 
(311,742
)
 
128,241

Total
$
10,536,606

 
(3,606,141
)
 
6,930,465

 
$
10,086,939

 
(3,596,102
)
 
6,490,837

 ————————————
(1)
Revenue earning equipment, net includes vehicles acquired under capital leases of $48.1 million, less accumulated depreciation of $20.1 million, at June 30, 2014, and $54.2 million, less accumulated depreciation of $22.0 million, at December 31, 2013.

At the end of 2013, we completed our annual review of residual values and useful lives of revenue earning equipment. Based on the results of our analysis, we adjusted the estimated residual values of certain classes of revenue earning equipment effective January 1, 2014. The change in estimated residual values and useful lives increased pre-tax earnings for the three and six months ended June 30, 2014 by approximately $6.3 million and $12.5 million, respectively.

We lease revenue earning equipment to customers for periods typically ranging from three to seven years for trucks and tractors and up to ten years for trailers. The majority of our leases are classified as operating leases. However, some of our revenue earning equipment leases are classified as direct financing leases and, to a lesser extent, sales-type leases. As of June 30, 2014 and December 31, 2013, the net investment in direct financing and sales-type leases was $417.8 million and $400.1 million, respectively. Our direct financing lease customers operate in a wide variety of industries, and we have no significant customer concentrations in any one industry. We assess credit risk for all of our customers including those who lease equipment under direct financing leases upon signing of a full service lease contract. For those customers who are designated as high risk, we typically require deposits to be paid in advance in order to mitigate our credit risk. Additionally, our receivables are collateralized by the vehicles, based on their estimated fair values, which further mitigates our credit risk.

As of June 30, 2014 and December 31, 2013, the amount of direct financing lease receivables past due was not significant, and there were no impaired receivables. Accordingly, we do not believe there is a material risk of default with respect to the direct financing lease receivables. The allowance for credit losses was $0.4 million and $0.5 million as of June 30, 2014 and December 31, 2013, respectively.
Goodwill
GOODWILL
GOODWILL

The carrying amount of goodwill attributable to each reportable business segment with changes therein was as follows:
 
Fleet
Management
Solutions
 
Supply
Chain
Solutions
 
Total
 
(In thousands)
Balance at January 1, 2014:
 
 
 
 
 
Goodwill
$
223,204

 
189,736

 
412,940

Accumulated impairment losses
(10,322
)
 
(18,899
)
 
(29,221
)
 
212,882

 
170,837

 
383,719

Foreign currency translation adjustments
197

 
(37
)
 
160

Balance at June 30, 2014:
 
 
 
 
 
Goodwill
223,401

 
189,699

 
413,100

Accumulated impairment losses
(10,322
)
 
(18,899
)
 
(29,221
)
 
$
213,079

 
170,800

 
383,879


 
We assess goodwill for impairment on April 1st of each year or more often if deemed necessary. In the second quarter of 2014, we completed our annual goodwill impairment test. We performed a quantitative test for one reporting unit in the Supply Chain Solutions business segment and determined there was no impairment. We performed a qualitative test for our other reporting units, which considered individual factors such as macroeconomic conditions, changes in our industry and the markets in which we operate as well as our historical and expected future financial performance. After performing the qualitative assessment, we concluded it is more likely than not that fair values are greater than carrying values and determined there was no impairment.
Accrued Expenses and Other Liabilities
ACCRUED EXPENSES AND OTHER LIABILITIES
ACCRUED EXPENSES AND OTHER LIABILITIES
 
June 30, 2014
 
December 31, 2013
 
Accrued
Expenses
 
Non-Current
Liabilities
 
Total
 
Accrued
Expenses
 
Non-Current
Liabilities
 
Total
 
(In thousands)
Salaries and wages
$
87,951

 
—

 
87,951

 
$
106,281

 
—

 
106,281

Deferred compensation
2,966

 
34,123

 
37,089

 
2,505

 
31,896

 
34,401

Other employee benefits
6,060

 
4,271

 
10,331

 
3,809

 
6,712

 
10,521

Pension benefits
3,606

 
239,904

 
243,510

 
3,660

 
292,155

 
295,815

Other postretirement benefits
2,413

 
27,481

 
29,894

 
2,414

 
28,374

 
30,788

Insurance obligations (1)
131,763

 
189,595

 
321,358

 
125,835

 
186,700

 
312,535

Accrued rent
2,102

 
2,222

 
4,324

 
4,373

 
3,372

 
7,745

Environmental liabilities
4,018

 
8,828

 
12,846

 
4,515

 
8,548

 
13,063

Asset retirement obligations
5,049

 
19,689

 
24,738

 
6,144

 
19,403

 
25,547

Operating taxes
96,657

 
—

 
96,657

 
94,188

 
—

 
94,188

Income taxes
284

 
25,552

 
25,836

 
2,623

 
23,813

 
26,436

Interest
30,968

 
—

 
30,968

 
33,654

 
—

 
33,654

Deposits, mainly from customers
56,411

 
6,175

 
62,586

 
55,854

 
6,239

 
62,093

Deferred revenue
14,652

 
—

 
14,652

 
15,123

 
—

 
15,123

Other
34,147

 
8,402

 
42,549

 
35,359

 
9,093

 
44,452

Total
$
479,047

 
566,242

 
1,045,289

 
$
496,337

 
616,305

 
1,112,642

 ————————————
(1) Insurance obligations are primarily comprised of self-insured claim liabilities.
Debt
DEBT
DEBT
 
Weighted-Average
Interest Rate
 
 
 
 
 
 
 
June 30,
2014
 
December 31,
2013
 
Maturities
 
June 30,
2014
 
December 31,
2013
 
 
 
 
 
 
 
(In thousands)
Short-term debt and current portion of long-term debt:
 
 
 
 
 
 
 
 
 
Short-term debt
1.28%
 
1.70%
 
2014
 
$
1,604

 
1,315

U.S. commercial paper (1)
0.26%
 
—%
 
2014
 
144,000

 
—

Current portion of long-term debt, including capital leases
 
 
 
 
 
 
412,077

 
258,123

Total short-term debt and current portion of long-term debt
 
 
 
 
 
 
557,681

 
259,438

Long-term debt:
 
 
 
 
 
 
 
 
 
U.S. commercial paper (1)
0.26%
 
0.28%
 
2018
 
375,949

 
486,939

Canadian commercial paper (1)
—%
 
1.13%
 
2018
 
—

 
11,297

Unsecured U.S. notes — Medium-term notes (1)
3.29%
 
3.76%
 
2015-2025
 
3,771,238

 
3,271,734

Unsecured U.S. obligations, principally bank term loans
1.44%
 
1.45%
 
2015-2018
 
55,500

 
55,500

Unsecured foreign obligations
1.99%
 
1.99%
 
2015-2016
 
324,423

 
315,558

Capital lease obligations
3.69%
 
3.81%
 
2014-2019
 
36,584

 
38,911

Total before fair market value adjustment
 
 
 
 
 
 
4,563,694

 
4,179,939

Fair market value adjustment on notes subject to hedging (2)
 
 
 
 
 
7,855

 
8,171

 
 
 
 
 
 
 
4,571,549

 
4,188,110

Current portion of long-term debt, including capital leases
 
 
 
 
 
 
(412,077
)
 
(258,123
)
Long-term debt
 
 
 
 
 
 
4,159,472

 
3,929,987

Total debt
 
 
 
 
 
 
$
4,717,153

 
4,189,425

 ————————————
(1)
We had unamortized original issue discounts of $8.8 million and $8.3 million at June 30, 2014 and December 31, 2013, respectively.
(2)
The notional amount of executed interest rate swaps designated as fair value hedges was $600 million and $400 million at June 30, 2014 and December 31, 2013, respectively.

We maintain a $900 million global revolving credit facility with a syndicate of twelve lending institutions led by Bank of America N.A., Bank of Tokyo-Mitsubishi UFJ, Ltd., BNP Paribas, Mizuho Corporate Bank, Ltd., Royal Bank of Canada, Royal Bank of Scotland Plc, U.S. Bank National Association and Wells Fargo Bank, N.A. The global credit facility matures in October 2018. The global facility is used primarily to finance working capital but can also be used to issue up to $75 million in letters of credit (there were no letters of credit outstanding against the facility at June 30, 2014). At our option, the interest rate on borrowings under the credit facility is based on LIBOR, prime, federal funds or local equivalent rates. The agreement provides for annual facility fees which range from 8.0 basis points to 27.5 basis points and are based on Ryder’s long-term credit ratings. The annual facility fee is 12.5 basis points, which applies to the total facility size of $900 million. The credit facility contains no provisions limiting its availability in the event of a material adverse change to Ryder’s business operations; however, the credit facility does contain standard representations and warranties, events of default, cross-default provisions and certain affirmative and negative covenants. In order to maintain availability of funding, we must maintain a ratio of debt to consolidated net worth of less than or equal to 300%. Net worth, as defined in the credit facility, represents shareholders' equity excluding any accumulated other comprehensive income or loss associated with our pension and other postretirement plans. The ratio at June 30, 2014 was 194%. At June 30, 2014, $380.0 million was available under the credit facility.

Our global revolving credit facility enables us to refinance short-term obligations on a long-term basis. Settlement of short-term commercial paper obligations not expected to require the use of working capital are classified as long-term as we have both the intent and ability to refinance on a long-term basis. At June 30, 2014 and December 31, 2013, we classified $375.9 million and $498.2 million, respectively, of short-term commercial paper as long-term debt. At June 30, 2014, we reclassified $144.0 million of commercial paper as short-term debt as we do not expect to refinance these borrowings for at least one year from the balance sheet date.

In May 2014, we issued $400 million of unsecured medium-term notes maturing in September 2019 and in February 2014, we issued $350 million of unsecured medium-term notes maturing in June 2019. The proceeds from the notes were used to reduce commercial paper balances and for general corporate purposes. If the notes are downgraded below investment grade following, and as a result of, a change in control, the note holder can require us to repurchase all or a portion of the notes at a purchase price equal to 101% of principal plus accrued and unpaid interest.

We have a trade receivables purchase and sale program, pursuant to which we sell certain of our domestic trade accounts receivable to a bankruptcy remote, consolidated subsidiary of Ryder, that in turn sells, on a revolving basis, an ownership interest in certain of these accounts receivable to a receivables conduit or committed purchasers. The subsidiary is considered a VIE and is consolidated based on our control of the entity’s activities. We use this program to provide additional liquidity to fund our operations, particularly when it is cost effective to do so. The costs under the program may vary based on changes in interest rates. The available proceeds that may be received under the program are limited to $175 million. If no event occurs that causes early termination, the 364-day program will expire on October 24, 2014. The program contains provisions restricting its availability in the event of a material adverse change to our business operations or the collectibility of the collateralized receivables. At June 30, 2014 and December 31, 2013, no amounts were outstanding under the program. Sales of receivables under this program will be accounted for as secured borrowings based on our continuing involvement in the transferred assets.

At June 30, 2014 and December 31, 2013, we had letters of credit and surety bonds outstanding totaling $310.7 million and $310.5 million, respectively, which primarily guarantee the payment of insurance claims.
Fair Value Measurements
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS

The assets and liabilities measured at fair value on a recurring basis consist primarily of interest rate swaps and investments held in Rabbi Trusts.  These amounts as of June 30, 2014 are not material to our consolidated financial position and operations and have not changed significantly from the amounts reported as of December 31, 2013.  

The following tables present our assets and liabilities that are measured at fair value on a nonrecurring basis and the levels of inputs used to measure fair value:
 
Fair Value Measurements
At June 30, 2014 Using
 
Total Losses (2)
 
 
Level 3
 
Three months  ended
 
Six months ended
 
(In thousands)
Assets held for sale:
 
 
 
 
 
 
Revenue earning equipment: (1)
 
 
 
 
 
 
Trucks
 
10,713

 
$
1,572

 
$
3,454

Tractors
 
6,057

 
662

 
2,294

Trailers
 
497

 
281

 
442

Total assets at fair value
 
17,267

 
$
2,515

 
$
6,190

 
 
Fair Value Measurements
At June 30, 2013 Using
 
Total Losses (2)
 
 
Level 3
 
Three months
 ended
 
Six months ended
 
(In thousands)
Assets held for sale:
 
 
 
 
 
 
Revenue earning equipment (1)
 
 
 
 
 
 
Trucks
 
11,132

 
$
2,447

 
$
5,476

Tractors
 
16,283

 
1,413

 
2,508

Trailers
 
882

 
370

 
967

Total assets at fair value
 
28,297

 
$
4,230

 
$
8,951

 ————————————
(1)
Represents the portion of all revenue earning equipment held for sale that is recorded at fair value, less costs to sell.
(2)
Total losses represent fair value adjustments for all vehicles held for sale throughout the period for which fair value was less than carrying value.

Revenue earning equipment held for sale is stated at the lower of carrying amount or fair value less costs to sell. Only certain vehicles held for sale have carrying amounts greater than the fair value and losses are recorded at the time they arrive at our used truck centers. We typically record gains on the remaining vehicles with carrying amounts greater than fair value at the time they are sold. Losses to reflect changes in fair value are presented within “Other operating expenses” in the Consolidated Condensed Statements of Earnings. For revenue earning equipment held for sale, we stratify our fleet by vehicle type (trucks, tractors and trailers), weight class, age and other relevant characteristics and create classes of similar assets for analysis purposes. Fair value was determined based upon recent market prices obtained from our own sales experience for sales of each class of similar assets and vehicle condition. Therefore, our revenue earning equipment held for sale was classified within Level 3 of the fair value hierarchy.

Fair value of total debt (excluding capital lease obligations) at June 30, 2014 and December 31, 2013 was approximately $4.83 billion and $4.28 billion, respectively. For publicly-traded debt, estimates of fair value were based on market prices. Since our publicly-traded debt is not actively traded, the fair value measurement was classified within Level 2 of the fair value hierarchy. For other debt, fair value was estimated based on a model-driven approach using rates currently available to us for debt with similar terms and remaining maturities. Therefore, the fair value measurement of our other debt was classified within Level 2 of the fair value hierarchy. The carrying amounts reported in the Consolidated Condensed Balance Sheets for “Cash and cash equivalents,” “Receivables, net” and “Accounts payable” approximate fair value because of the immediate or short-term maturities of these financial instruments.
Derivatives
DERIVATIVES
DERIVATIVES

We have interest rate swaps outstanding which are designated as fair value hedges whereby we receive fixed interest rate payments in exchange for making variable interest rate payments. The differential to be paid or received is accrued and recognized as interest expense. The following table provides a detail of the swaps outstanding and the related hedged items as of June 30, 2014:
 
 
 
Maturity date
 
Face value of medium-term notes
 
Aggregate 
notional
amount of interest rate swaps
 
Fixed interest 
rate
 
Weighted-average variable
interest rate on hedged debt
as of June 30,
Issuance date
 
 
 
 
 
2014
 
2013
 
 
 
 
(Dollars in thousands)
 
 
 
 
 
 
February 2011
 
March 2015
 
$350,000
 
$150,000
 
3.15%
 
1.28%
 
1.41%
May 2011
 
June 2017
 
$350,000
 
$150,000
 
3.50%
 
1.42%
 
1.51%
November 2013
 
November 2018
 
$300,000
 
$100,000
 
2.45%
 
1.18%
 
—%
February 2014
 
June 2019
 
$350,000
 
$100,000
 
2.55%
 
1.10%
 
—%
May 2014
 
September 2019
 
$400,000
 
$100,000
 
2.45%
 
0.85%
 
—%


Changes in the fair value of our interest rate swaps are offset by changes in the fair value of the debt instrument. Accordingly, there is no ineffectiveness related to the interest rate swaps. The location and amount of gains (losses) on interest rate swap agreements designated as fair value hedges and related hedged items reported in the Consolidated Condensed Statements of Earnings were as follows:
Fair Value Hedging Relationship
 
Location of
 Gain (Loss)
Recognized in Income
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
 
 
 
(In thousands)
Derivatives: Interest rate swaps
 
Interest expense
 
$
1,667

 
(3,586
)
 
$
(316
)
 
(6,367
)
Hedged items: Fixed-rate debt
 
Interest expense
 
(1,667
)
 
3,586

 
316

 
6,367

Total
 
 
 
$
—

 
—

 
$
—

 
—



The derivatives are pay-variable, receive-fixed interest rate swaps based on the LIBOR rate and are designated as fair value hedges. Fair value was based on a model-driven income approach using the LIBOR rate at each interest payment date, which was observable at commonly quoted intervals for the full term of the swaps. Therefore, our interest rate swaps were classified within Level 2 of the fair value hierarchy. The location and fair value amounts of the interest rate swaps reported on the Consolidated Condensed Balance Sheets were as follows:
Balance Sheet Location
 
June 30,
2014
 
December 31,
2013
 
 
(In thousands)
Prepaid expenses and other current assets
 
$
1,834

 
$
—

Direct financing leases and other assets
 
6,162

 
9,333

Other non-current liabilities
 
(141
)
 
(1,162
)
Share Repurchase Programs
SHARE REPURCHASE PROGRAMS
SHARE REPURCHASE PROGRAMS

In December 2013, our Board of Directors authorized a share repurchase program intended to mitigate the dilutive impact of shares issued under our various employee stock, stock option and employee stock purchase plans. Under the December 2013 program, management is authorized to repurchase shares of common stock in an amount not to exceed the number of shares issued to employees under the Company’s various employee stock, stock option and employee stock purchase plans from December 1, 2013 through December 31, 2015. The December 2013 program limits aggregate share repurchases to no more than 2 million shares of Ryder common stock. Share repurchases of common stock are made periodically in open-market transactions and are subject to market conditions, legal requirements and other factors. Management established prearranged written plans for the Company under Rule 10b5-1 of the Securities Exchange Act of 1934 as part of the December 2013 program, which allow for share repurchases during Ryder’s quarterly blackout periods as set forth in the trading plan. For the three months ended June 30, 2014, we repurchased and retired 464,389 shares under the program at an aggregate cost of $39.1 million. For the six months ended June 30, 2014, we repurchased and retired 1,027,072 shares under the program at an aggregate cost of $79.5 million. We did not repurchase any shares under this program in 2013.

In December 2011, our Board of Directors authorized a share repurchase program intended to mitigate the dilutive impact of shares issued under our various employee stock, stock option and employee stock purchase plans. Under the December 2011 program, management was authorized to repurchase shares of common stock in an amount not to exceed the number of shares issued to employees under the Company's various employee stock, stock option and employee stock purchase plans from December 1, 2011 through December 13, 2013. The December 2011 program limited aggregate share repurchases to no more than 2 million shares of Ryder common stock. In 2013, we did not repurchase any shares under this program as we temporarily paused our anti-dilutive share repurchase program to appropriately manage our leverage and to allow us to maintain near-term balance sheet flexibility.
Accumulated Other Comprehensive Loss
Comprehensive Income (Loss) Note [Text Block]
ACCUMULATED OTHER COMPREHENSIVE LOSS

The following summaries set forth the components of accumulated other comprehensive loss, net of tax:
 
 
 
Currency
Translation
Adjustments and Other
 
Net Actuarial
Loss (1)
 
Prior Service
Credit (1)
 
Accumulated
Other
Comprehensive
Loss
 
 
(In thousands)
December 31, 2013
 
$
35,875

 
(477,883
)
 
3,760

 
(438,248
)
Amortization
 
—

 
7,455

 
(1,335
)
 
6,120

Other current period change
 
11,681

 
(2,048
)
 
—

 
9,633

June 30, 2014
 
$
47,556

 
(472,476
)
 
2,425

 
(422,495
)

December 31, 2012
 
$
57,860

 
(648,113
)
 
2,634

 
(587,619
)
Amortization
 
—

 
11,514

 
(697
)
 
10,817

Other current period change
 
(49,943
)
 
(3,714
)
 
—

 
(53,657
)
June 30, 2013
 
$
7,917

 
(640,313
)
 
1,937

 
(630,459
)

_______________________ 

(1)
These amounts are included in the computation of net periodic pension cost. See Note (N), "Employee Benefit Plans," for further information.
Employee Benefit Plans
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS

Components of net periodic benefit cost were as follows:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Pension Benefits
 
 
 
 
 
 
 
Company-administered plans:
 
 
 
 
 
 
 
Service cost
$
3,171

 
3,756

 
$
6,594

 
8,008

Interest cost
25,135

 
22,316

 
50,696

 
44,735

Expected return on plan assets
(29,284
)
 
(26,389
)
 
(58,002
)
 
(52,837
)
Amortization of:
 
 
 
 
 
 
 
Net actuarial loss
5,579

 
8,685

 
11,814

 
17,565

Prior service credit
(435
)
 
(443
)
 
(893
)
 
(909
)
 
4,166

 
7,925

 
10,209

 
16,562

Union-administered plans
2,123

 
2,046

 
4,214

 
4,030

Net periodic benefit cost
$
6,289

 
9,971

 
$
14,423

 
20,592

 
 
 
 
 
 
 
 
Company-administered plans:
 
 
 
 
 
 
 
U.S.
$
4,499

 
8,152

 
$
10,786

 
16,893

Non-U.S.
(333
)
 
(227
)
 
(577
)
 
(331
)
 
4,166

 
7,925

 
10,209

 
16,562

Union-administered plans
2,123

 
2,046

 
4,214

 
4,030

 
$
6,289

 
9,971

 
$
14,423

 
20,592

 
 
 
 
 
 
 
 
Postretirement Benefits
 
 
 
 
 
 
 
Company-administered plans:
 
 
 
 
 
 
 
Service cost
$
89

 
230

 
$
224

 
493

Interest cost
348

 
392

 
713

 
787

Amortization of:
 
 
 
 
 
 
 
Net actuarial credit
(234
)
 
(5
)
 
(363
)
 
(7
)
Prior service credit
(615
)
 
(57
)
 
(1,230
)
 
(115
)
Net periodic benefit cost
$
(412
)
 
560

 
$
(656
)
 
1,158

Company-administered plans:
 
 
 
 
 
 
 
U.S.
$
(524
)
 
402

 
$
(921
)
 
808

Non-U.S.
112

 
158

 
265

 
350

 
$
(412
)
 
560

 
$
(656
)
 
1,158



During the six months ended June 30, 2014, we contributed $65.0 million to our pension plans. All of the contributions to the U.S. plan for 2014 were made as of June 30, 2014. In 2014, we expect total contributions to our pension plans to be approximately $75 million.
Other Items
Other Items Impacting Comparability [Text Block]
OTHER ITEMS IMPACTING COMPARABILITY

Our primary measure of segment performance excludes certain items we do not believe are representative of the ongoing operations of the segment. We believe that excluding these items from our segment measure of performance allows for better comparison of results.
During the six months ended June 30, 2013, we recognized a benefit of $1.9 million (before and after tax) from the recognition of the accumulated currency translation adjustment from a FMS foreign operation which has substantially liquidated its net assets. This benefit was recorded within “Miscellaneous income, net” in our Consolidated Condensed Statements of Earnings.
Supplemental Cash Flow Information
SUPPLEMENTAL CASH FLOW INFORMATION
SUPPLEMENTAL CASH FLOW INFORMATION

Supplemental cash flow information was as follows:
 
Six months ended June 30,
 
2014
 
2013
 
(In thousands)
Interest paid
$
68,974

 
67,545

Income taxes paid
7,332

 
8,447

Changes in accounts payable related to purchases of revenue earning equipment
1,520

 
40,389

Operating and revenue earning equipment acquired under capital leases
2,371

 
4,814



During the six months ended June 30, 2014 and 2013, we paid $1.6 million and $1.4 million, respectively, related to acquisitions completed in prior years.
Miscellaneous Income, Net
Other Income and Other Expense Disclosure [Text Block]
(Q) MISCELLANEOUS INCOME, NET
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014

2013
 
(In thousands)
Contract settlement
$
—

 
—

 
$
2,908

 
—

Gains on sales of operating property and equipment
1,286

 
267

 
2,590

 
540

Business interruption insurance recoveries
756

 
1,805

 
756


1,805

Foreign currency translation benefit (1)
—

 
—

 
—

 
1,904

Rabbi trust investment income
1,077

 
172

 
1,577

 
1,631

Other, net
1,709

 
1,331

 
2,379

 
2,265

Total
$
4,828

 
3,575

 
$
10,210

 
8,145

 ————————————
(1) Refer to Note (O), "Other Items Impacting Comparability," for additional information.
Segment Reporting
SEGMENT REPORTING
SEGMENT REPORTING

Our operating segments are aggregated into reportable business segments based upon similar economic characteristics, products, services, customers and delivery methods. We operate in two reportable business segments: (1) FMS, which provides full service leasing, contract maintenance, contract-related maintenance and commercial rental of trucks, tractors and trailers to customers, principally in the U.S., Canada and the U.K.; and (2) SCS, which provides comprehensive supply chain management solutions including distribution and transportation services in North America and Asia. The SCS segment also provides dedicated services, which includes vehicles and drivers as part of a dedicated transportation solution in the U.S.

Our primary measurement of segment financial performance, defined as “Earnings Before Tax” (EBT) from continuing operations, includes an allocation of Central Support Services (CSS) and excludes non-operating pension costs, restructuring and other charges, net and the items discussed in Note (O), “Other Items Impacting Comparability.” CSS represents those costs incurred to support all business segments, including human resources, finance, corporate services, public affairs, information technology, health and safety, legal, marketing and corporate communications. The objective of the EBT measurement is to provide clarity on the profitability of each business segment and, ultimately, to hold leadership of each business segment and each operating segment within each business segment accountable for their allocated share of CSS costs. Certain costs are considered to be overhead not attributable to any segment and remain unallocated in CSS. Included among the unallocated overhead remaining within CSS are the costs for investor relations, public affairs and certain executive compensation.

Our FMS segment leases revenue earning equipment and provides fuel, maintenance and other ancillary services to the SCS segment. Inter-segment revenue and EBT are accounted for at rates similar to those executed with third parties. EBT related to inter-segment equipment and services billed to customers (equipment contribution) are included in both FMS and SCS and then eliminated (presented as “Eliminations”). 

The following tables set forth financial information for each of our business segments and provides a reconciliation between segment EBT and earnings from continuing operations before income taxes for the three and six months ended June 30, 2014 and 2013. Segment results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented.
 
FMS
 
SCS
 
Eliminations
 
Total
 
(In thousands)
 
 
For the three months ended June 30, 2014
 
 
 
 
 
 
Revenue from external customers
$
1,056,992

 
627,579

 
—

 
1,684,571

Inter-segment revenue
124,230

 
—

 
(124,230
)
 
—

Total revenue
$
1,181,222

 
627,579

 
(124,230
)
 
1,684,571

 
 
 
 
 
 
 
 
Segment EBT
$
113,509

 
30,728

 
(10,523
)
 
133,714

Unallocated CSS
 
 
 
 
 
 
(12,125
)
     Non-operating pension costs 
 
 
 
 
 
 
(1,544
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
120,045

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1)
$
623,138

 
4,249

 
—

 
627,387

Unallocated CSS
 
 
 
 
 
 
49,113

Capital expenditures paid
 
 
 
 
 
 
$
676,500

 
 
 
 
 
 
 
 
For the three months ended June 30, 2013
 
 
 
 
 
 
Revenue from external customers
$
1,006,822

 
597,177

 
—

 
1,603,999

Inter-segment revenue
114,436

 
—

 
(114,436
)
 
—

Total revenue
$
1,121,258

 
597,177

 
(114,436
)
 
1,603,999

 
 
 
 
 
 
 
 
Segment EBT
$
88,667

 
32,968

 
(8,690
)
 
112,945

Unallocated CSS
 
 
 
 
 
 
(10,584
)
Non-operating pension costs 
 
 
 
 
 
 
(4,999
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
97,362

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1)
$
517,131

 
5,017

 
—

 
522,148

Unallocated CSS
 
 
 
 
 
 
5,912

Capital expenditures paid
 
 
 
 
 
 
$
528,060

 ————————————
(1)
Excludes revenue earning equipment acquired under capital leases.

 
FMS
 
SCS
 
Eliminations
 
Total
 
(In thousands)
 
 
For the six months ended June 30, 2014
 
 
 
 
 
 
Revenue from external customers
$
2,070,388

 
1,224,920

 
—

 
3,295,308

Inter-segment revenue
245,921

 
—

 
(245,921
)
 
—

Total revenue
$
2,316,309

 
1,224,920

 
(245,921
)
 
3,295,308

 
 
 
 
 
 
 
 
Segment EBT
$
190,500

 
52,512

 
(20,151
)
 
222,861

Unallocated CSS
 
 
 
 
 
 
(22,954
)
     Non-operating pension costs 
 
 
 
 
 
 
(4,858
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
195,049

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1), (2)
$
1,191,377

 
8,121

 
—

 
1,199,498

Unallocated CSS
 
 
 
 
 
 
55,724

Capital expenditures paid
 
 
 
 
 
 
$
1,255,222

 
 
 
 
 
 
 
 
For the six months ended June 30, 2013
 
 
 
 
 
 
Revenue from external customers
$
1,993,360

 
1,173,656

 
—

 
3,167,016

Inter-segment revenue
227,630

 
—

 
(227,630
)
 
—

Total revenue
$
2,220,990

 
1,173,656

 
(227,630
)
 
3,167,016

 
 
 
 
 
 
 
 
Segment EBT
$
149,412

 
57,404

 
(16,648
)
 
190,168

Unallocated CSS
 
 
 
 
 
 
(21,959
)
Non-operating pension costs 
 
 
 
 
 
 
(10,243
)
Restructuring and other charges, net and other items
 
 
 
 
 
 
1,904

Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
159,870

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1), (2)
$
923,642

 
10,817

 
—

 
934,459

Unallocated CSS
 
 
 
 
 
 
13,655

Capital expenditures paid
 
 
 
 
 
 
$
948,114

 ————————————
(1)
Excludes revenue earning equipment acquired under capital leases.
(2)
Excludes acquisition payments of $1.6 million and $1.4 million during the six months ended June 30, 2014, and 2013, respectively.
Other Matters
OTHER MATTERS
OTHER MATTERS

We are a party to various claims, complaints and proceedings arising in the ordinary course of our continuing business operations including but not limited to those relating to commercial and employment claims, environmental matters, risk management matters (e.g. vehicle liability, workers’ compensation, etc.) and administrative assessments primarily associated with operating taxes. We have established loss provisions for matters in which losses are probable and can be reasonably estimated. For matters from continuing operations where a reserve has not been established and for which we believe a loss is reasonably possible, as well as for matters where a reserve has been recorded but for which an exposure to loss in excess of the amount accrued is reasonably possible, we believe that such losses will not have a material effect on our consolidated financial statements.

Our estimates regarding potential losses and materiality are based on our judgment and assessment of the claims utilizing currently available information. Although we will continue to reassess our reserves and estimates based on future developments, our objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from our current estimates.

Refer to Note (C), “Discontinued Operations,” for additional matters.
Discontinued Operations (Tables)
Loss from discontinued operations 
Summarized results of discontinued operations were as follows:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Pre-tax loss from discontinued operations
$
(323
)
 
(298
)
 
$
(1,278
)
 
(1,199
)
Income tax (expense) benefit
(13
)
 
(83
)
 
76

 
(60
)
Loss from discontinued operations, net of tax
$
(336
)
 
(381
)
 
$
(1,202
)
 
(1,259
)
Summary of assets and liabilities of discontinued operations 
The following is a summary of assets and liabilities of discontinued operations:
 
June 30,
2014
 
December 31,
2013
 
(In thousands)
Total assets, primarily deposits
$
3,452

 
3,627

Total liabilities, primarily contingent accruals
$
4,476

 
4,501

Share-Based Compensation Plans (Tables)
Share-based compensation expense and income tax benefits recognized during the periods 
The following table provides information on share-based compensation expense and income tax benefits recognized during the periods:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Stock option and stock purchase plans
$
2,241

 
2,193

 
$
4,478

 
4,303

Nonvested stock
2,890

 
2,799

 
5,511

 
5,299

Share-based compensation expense
5,131

 
4,992

 
9,989

 
9,602

Income tax benefit
(1,713
)
 
(1,640
)
 
(3,389
)
 
(3,327
)
Share-based compensation expense, net of tax
$
3,418

 
3,352

 
$
6,600

 
6,275

Summary of share-based compensation expense recognized related to cash awards 
The following table is a summary of compensation expense recognized for market-based cash awards in addition to the share-based compensation expense reported in the previous table:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Cash awards
$
743

 
889
 
$
1,266

 
2,163


Total unrecognized pre-tax compensation expense related to all share-based compensation arrangements at June 30, 2014 was $33.4 million and is expected to be recognized over a weighted-average period of 2.0 years.

Schedule of share-based compensation awards, grants issued in the period 
The following table is a summary of the awards granted under the Plans during the periods presented:
 
 
June 30,
2014
 
June 30,
2013
 
 
(In thousands)
 
 
Stock options
 
405

 
381

Market-based restricted stock rights
 
22

 
22

Performance-based restricted stock rights
 
30

 
15

Time-vested restricted stock rights
 
158

 
146

Total
 
615

 
564

Earnings Per Share (Tables)
Schedule of basic and diluted earnings per common share from continuing operations
The following table presents the calculation of basic and diluted earnings per common share from continuing operations:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands, except per share amounts)
Earnings per share — Basic:
 
 
 
 
 
 
 
Earnings from continuing operations
$
75,694

 
62,575

 
$
124,792

 
103,377

Less: Distributed and undistributed earnings allocated to nonvested stock
(301
)
 
(556
)
 
(582
)
 
(978
)
Earnings from continuing operations available to common shareholders — Basic
$
75,393

 
62,019

 
$
124,210

 
102,399

 
 
 
 
 
 
 
 
Weighted average common shares outstanding — Basic
52,564

 
51,445

 
52,612

 
51,201

 
 
 
 
 
 
 
 
Earnings from continuing operations per common share — Basic
$
1.43

 
1.21

 
$
2.36

 
2.00

 
 
 
 
 
 
 
 
Earnings per share — Diluted:
 
 
 
 
 
 
 
Earnings from continuing operations
$
75,694

 
62,575

 
$
124,792

 
103,377

Less: Distributed and undistributed earnings allocated to nonvested stock
(299
)
 
(552
)
 
(578
)
 
(972
)
Earnings from continuing operations available to common shareholders — Diluted
$
75,395

 
62,023

 
$
124,214

 
102,405

 
 
 
 
 
 
 
 
Weighted average common shares outstanding — Basic
52,564

 
51,445

 
52,612

 
51,201

Effect of dilutive equity awards
482

 
478

 
472

 
457

Weighted average common shares outstanding — Diluted
53,046

 
51,923

 
53,084

 
51,658

 
 
 
 
 
 
 
 
Earnings from continuing operations per common share — Diluted
$
1.42

 
1.19

 
$
2.34

 
1.98

 
 
 
 
 
 
 
 
Anti-dilutive equity awards not included above
412

 
593

 
314

 
1,003

Revenue Earning Equipment (Tables)
Summary of revenue earning equipment
 
June 30, 2014
 
December 31, 2013
 
Cost
 
Accumulated
Depreciation
 
Net  Book
Value(1)
 
Cost
 
Accumulated
Depreciation
 
Net  Book
Value(1)
 
(In thousands)
Held for use:
 
Full service lease
$
7,699,750

 
(2,564,790
)
 
5,134,960

 
$
7,436,093

 
(2,537,077
)
 
4,899,016

Commercial rental
2,491,695

 
(791,662
)
 
1,700,033

 
2,210,863

 
(747,283
)
 
1,463,580

Held for sale
345,161

 
(249,689
)
 
95,472

 
439,983

 
(311,742
)
 
128,241

Total
$
10,536,606

 
(3,606,141
)
 
6,930,465

 
$
10,086,939

 
(3,596,102
)
 
6,490,837

 ————————————
(1)
Revenue earning equipment, net includes vehicles acquired under capital leases of $48.1 million, less accumulated depreciation of $20.1 million, at June 30, 2014, and $54.2 million, less accumulated depreciation of $22.0 million, at December 31, 2013.

Goodwill (Tables)
Carrying amount of goodwill attributable to each reportable business segment
The carrying amount of goodwill attributable to each reportable business segment with changes therein was as follows:
 
Fleet
Management
Solutions
 
Supply
Chain
Solutions
 
Total
 
(In thousands)
Balance at January 1, 2014:
 
 
 
 
 
Goodwill
$
223,204

 
189,736

 
412,940

Accumulated impairment losses
(10,322
)
 
(18,899
)
 
(29,221
)
 
212,882

 
170,837

 
383,719

Foreign currency translation adjustments
197

 
(37
)
 
160

Balance at June 30, 2014:
 
 
 
 
 
Goodwill
223,401

 
189,699

 
413,100

Accumulated impairment losses
(10,322
)
 
(18,899
)
 
(29,221
)
 
$
213,079

 
170,800

 
383,879

Accrued Expenses and Other Liabilities (Tables)
Accrued Expenses and Other Liabilities
 
June 30, 2014
 
December 31, 2013
 
Accrued
Expenses
 
Non-Current
Liabilities
 
Total
 
Accrued
Expenses
 
Non-Current
Liabilities
 
Total
 
(In thousands)
Salaries and wages
$
87,951

 
—

 
87,951

 
$
106,281

 
—

 
106,281

Deferred compensation
2,966

 
34,123

 
37,089

 
2,505

 
31,896

 
34,401

Other employee benefits
6,060

 
4,271

 
10,331

 
3,809

 
6,712

 
10,521

Pension benefits
3,606

 
239,904

 
243,510

 
3,660

 
292,155

 
295,815

Other postretirement benefits
2,413

 
27,481

 
29,894

 
2,414

 
28,374

 
30,788

Insurance obligations (1)
131,763

 
189,595

 
321,358

 
125,835

 
186,700

 
312,535

Accrued rent
2,102

 
2,222

 
4,324

 
4,373

 
3,372

 
7,745

Environmental liabilities
4,018

 
8,828

 
12,846

 
4,515

 
8,548

 
13,063

Asset retirement obligations
5,049

 
19,689

 
24,738

 
6,144

 
19,403

 
25,547

Operating taxes
96,657

 
—

 
96,657

 
94,188

 
—

 
94,188

Income taxes
284

 
25,552

 
25,836

 
2,623

 
23,813

 
26,436

Interest
30,968

 
—

 
30,968

 
33,654

 
—

 
33,654

Deposits, mainly from customers
56,411

 
6,175

 
62,586

 
55,854

 
6,239

 
62,093

Deferred revenue
14,652

 
—

 
14,652

 
15,123

 
—

 
15,123

Other
34,147

 
8,402

 
42,549

 
35,359

 
9,093

 
44,452

Total
$
479,047

 
566,242

 
1,045,289

 
$
496,337

 
616,305

 
1,112,642

 ————————————
(1) Insurance obligations are primarily comprised of self-insured claim liabilities.
Debt (Tables)
Debt
 
Weighted-Average
Interest Rate
 
 
 
 
 
 
 
June 30,
2014
 
December 31,
2013
 
Maturities
 
June 30,
2014
 
December 31,
2013
 
 
 
 
 
 
 
(In thousands)
Short-term debt and current portion of long-term debt:
 
 
 
 
 
 
 
 
 
Short-term debt
1.28%
 
1.70%
 
2014
 
$
1,604

 
1,315

U.S. commercial paper (1)
0.26%
 
—%
 
2014
 
144,000

 
—

Current portion of long-term debt, including capital leases
 
 
 
 
 
 
412,077

 
258,123

Total short-term debt and current portion of long-term debt
 
 
 
 
 
 
557,681

 
259,438

Long-term debt:
 
 
 
 
 
 
 
 
 
U.S. commercial paper (1)
0.26%
 
0.28%
 
2018
 
375,949

 
486,939

Canadian commercial paper (1)
—%
 
1.13%
 
2018
 
—

 
11,297

Unsecured U.S. notes — Medium-term notes (1)
3.29%
 
3.76%
 
2015-2025
 
3,771,238

 
3,271,734

Unsecured U.S. obligations, principally bank term loans
1.44%
 
1.45%
 
2015-2018
 
55,500

 
55,500

Unsecured foreign obligations
1.99%
 
1.99%
 
2015-2016
 
324,423

 
315,558

Capital lease obligations
3.69%
 
3.81%
 
2014-2019
 
36,584

 
38,911

Total before fair market value adjustment
 
 
 
 
 
 
4,563,694

 
4,179,939

Fair market value adjustment on notes subject to hedging (2)
 
 
 
 
 
7,855

 
8,171

 
 
 
 
 
 
 
4,571,549

 
4,188,110

Current portion of long-term debt, including capital leases
 
 
 
 
 
 
(412,077
)
 
(258,123
)
Long-term debt
 
 
 
 
 
 
4,159,472

 
3,929,987

Total debt
 
 
 
 
 
 
$
4,717,153

 
4,189,425

 ————————————
(1)
We had unamortized original issue discounts of $8.8 million and $8.3 million at June 30, 2014 and December 31, 2013, respectively.
(2)
The notional amount of executed interest rate swaps designated as fair value hedges was $600 million and $400 million at June 30, 2014 and December 31, 2013, respectively.
Fair Value Measurements (Tables)
Assets and liabilities measured at fair value on nonrecurring basis
The following tables present our assets and liabilities that are measured at fair value on a nonrecurring basis and the levels of inputs used to measure fair value:
 
Fair Value Measurements
At June 30, 2014 Using
 
Total Losses (2)
 
 
Level 3
 
Three months  ended
 
Six months ended
 
(In thousands)
Assets held for sale:
 
 
 
 
 
 
Revenue earning equipment: (1)
 
 
 
 
 
 
Trucks
 
10,713

 
$
1,572

 
$
3,454

Tractors
 
6,057

 
662

 
2,294

Trailers
 
497

 
281

 
442

Total assets at fair value
 
17,267

 
$
2,515

 
$
6,190

 
 
Fair Value Measurements
At June 30, 2013 Using
 
Total Losses (2)
 
 
Level 3
 
Three months
 ended
 
Six months ended
 
(In thousands)
Assets held for sale:
 
 
 
 
 
 
Revenue earning equipment (1)
 
 
 
 
 
 
Trucks
 
11,132

 
$
2,447

 
$
5,476

Tractors
 
16,283

 
1,413

 
2,508

Trailers
 
882

 
370

 
967

Total assets at fair value
 
28,297

 
$
4,230

 
$
8,951

 ————————————
(1)
Represents the portion of all revenue earning equipment held for sale that is recorded at fair value, less costs to sell.
(2)
Total losses represent fair value adjustments for all vehicles held for sale throughout the period for which fair value was less than carrying value.

Derivatives (Tables)
Schedule of Derivative Instruments 
The following table provides a detail of the swaps outstanding and the related hedged items as of June 30, 2014:
 
 
 
Maturity date
 
Face value of medium-term notes
 
Aggregate 
notional
amount of interest rate swaps
 
Fixed interest 
rate
 
Weighted-average variable
interest rate on hedged debt
as of June 30,
Issuance date
 
 
 
 
 
2014
 
2013
 
 
 
 
(Dollars in thousands)
 
 
 
 
 
 
February 2011
 
March 2015
 
$350,000
 
$150,000
 
3.15%
 
1.28%
 
1.41%
May 2011
 
June 2017
 
$350,000
 
$150,000
 
3.50%
 
1.42%
 
1.51%
November 2013
 
November 2018
 
$300,000
 
$100,000
 
2.45%
 
1.18%
 
—%
February 2014
 
June 2019
 
$350,000
 
$100,000
 
2.55%
 
1.10%
 
—%
May 2014
 
September 2019
 
$400,000
 
$100,000
 
2.45%
 
0.85%
 
—%
Impact on the Consolidated Condensed Statements of Earnings related to Fair Value Hedges 
Changes in the fair value of our interest rate swaps are offset by changes in the fair value of the debt instrument. Accordingly, there is no ineffectiveness related to the interest rate swaps. The location and amount of gains (losses) on interest rate swap agreements designated as fair value hedges and related hedged items reported in the Consolidated Condensed Statements of Earnings were as follows:
Fair Value Hedging Relationship
 
Location of
 Gain (Loss)
Recognized in Income
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
 
 
 
(In thousands)
Derivatives: Interest rate swaps
 
Interest expense
 
$
1,667

 
(3,586
)
 
$
(316
)
 
(6,367
)
Hedged items: Fixed-rate debt
 
Interest expense
 
(1,667
)
 
3,586

 
316

 
6,367

Total
 
 
 
$
—

 
—

 
$
—

 
—

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] 

The derivatives are pay-variable, receive-fixed interest rate swaps based on the LIBOR rate and are designated as fair value hedges. Fair value was based on a model-driven income approach using the LIBOR rate at each interest payment date, which was observable at commonly quoted intervals for the full term of the swaps. Therefore, our interest rate swaps were classified within Level 2 of the fair value hierarchy. The location and fair value amounts of the interest rate swaps reported on the Consolidated Condensed Balance Sheets were as follows:
Balance Sheet Location
 
June 30,
2014
 
December 31,
2013
 
 
(In thousands)
Prepaid expenses and other current assets
 
$
1,834

 
$
—

Direct financing leases and other assets
 
6,162

 
9,333

Other non-current liabilities
 
(141
)
 
(1,162
)
Accumulated Other Comprehensive Loss (Tables)
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]
The following summaries set forth the components of accumulated other comprehensive loss, net of tax:
 
 
 
Currency
Translation
Adjustments and Other
 
Net Actuarial
Loss (1)
 
Prior Service
Credit (1)
 
Accumulated
Other
Comprehensive
Loss
 
 
(In thousands)
December 31, 2013
 
$
35,875

 
(477,883
)
 
3,760

 
(438,248
)
Amortization
 
—

 
7,455

 
(1,335
)
 
6,120

Other current period change
 
11,681

 
(2,048
)
 
—

 
9,633

June 30, 2014
 
$
47,556

 
(472,476
)
 
2,425

 
(422,495
)

December 31, 2012
 
$
57,860

 
(648,113
)
 
2,634

 
(587,619
)
Amortization
 
—

 
11,514

 
(697
)
 
10,817

Other current period change
 
(49,943
)
 
(3,714
)
 
—

 
(53,657
)
June 30, 2013
 
$
7,917

 
(640,313
)
 
1,937

 
(630,459
)
Employee Benefit Plans (Tables)
Components of net periodic benefit cost
Components of net periodic benefit cost were as follows:
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014
 
2013
 
(In thousands)
Pension Benefits
 
 
 
 
 
 
 
Company-administered plans:
 
 
 
 
 
 
 
Service cost
$
3,171

 
3,756

 
$
6,594

 
8,008

Interest cost
25,135

 
22,316

 
50,696

 
44,735

Expected return on plan assets
(29,284
)
 
(26,389
)
 
(58,002
)
 
(52,837
)
Amortization of:
 
 
 
 
 
 
 
Net actuarial loss
5,579

 
8,685

 
11,814

 
17,565

Prior service credit
(435
)
 
(443
)
 
(893
)
 
(909
)
 
4,166

 
7,925

 
10,209

 
16,562

Union-administered plans
2,123

 
2,046

 
4,214

 
4,030

Net periodic benefit cost
$
6,289

 
9,971

 
$
14,423

 
20,592

 
 
 
 
 
 
 
 
Company-administered plans:
 
 
 
 
 
 
 
U.S.
$
4,499

 
8,152

 
$
10,786

 
16,893

Non-U.S.
(333
)
 
(227
)
 
(577
)
 
(331
)
 
4,166

 
7,925

 
10,209

 
16,562

Union-administered plans
2,123

 
2,046

 
4,214

 
4,030

 
$
6,289

 
9,971

 
$
14,423

 
20,592

 
 
 
 
 
 
 
 
Postretirement Benefits
 
 
 
 
 
 
 
Company-administered plans:
 
 
 
 
 
 
 
Service cost
$
89

 
230

 
$
224

 
493

Interest cost
348

 
392

 
713

 
787

Amortization of:
 
 
 
 
 
 
 
Net actuarial credit
(234
)
 
(5
)
 
(363
)
 
(7
)
Prior service credit
(615
)
 
(57
)
 
(1,230
)
 
(115
)
Net periodic benefit cost
$
(412
)
 
560

 
$
(656
)
 
1,158

Company-administered plans:
 
 
 
 
 
 
 
U.S.
$
(524
)
 
402

 
$
(921
)
 
808

Non-U.S.
112

 
158

 
265

 
350

 
$
(412
)
 
560

 
$
(656
)
 
1,158

Supplemental Cash Flow Information (Tables)
Supplemental cash flow information
Supplemental cash flow information was as follows:
 
Six months ended June 30,
 
2014
 
2013
 
(In thousands)
Interest paid
$
68,974

 
67,545

Income taxes paid
7,332

 
8,447

Changes in accounts payable related to purchases of revenue earning equipment
1,520

 
40,389

Operating and revenue earning equipment acquired under capital leases
2,371

 
4,814

Miscellaneous Income, Net (Tables)
Schedule of Other Nonoperating Income (Expense)
 
Three months ended June 30,
 
Six months ended June 30,
 
2014
 
2013
 
2014

2013
 
(In thousands)
Contract settlement
$
—

 
—

 
$
2,908

 
—

Gains on sales of operating property and equipment
1,286

 
267

 
2,590

 
540

Business interruption insurance recoveries
756

 
1,805

 
756


1,805

Foreign currency translation benefit (1)
—

 
—

 
—

 
1,904

Rabbi trust investment income
1,077

 
172

 
1,577

 
1,631

Other, net
1,709

 
1,331

 
2,379

 
2,265

Total
$
4,828

 
3,575

 
$
10,210

 
8,145

 ————————————
(1) Refer to Note (O), "Other Items Impacting Comparability," for additional information.
Segment Reporting (Tables)
Financial information of business segments
 
FMS
 
SCS
 
Eliminations
 
Total
 
(In thousands)
 
 
For the three months ended June 30, 2014
 
 
 
 
 
 
Revenue from external customers
$
1,056,992

 
627,579

 
—

 
1,684,571

Inter-segment revenue
124,230

 
—

 
(124,230
)
 
—

Total revenue
$
1,181,222

 
627,579

 
(124,230
)
 
1,684,571

 
 
 
 
 
 
 
 
Segment EBT
$
113,509

 
30,728

 
(10,523
)
 
133,714

Unallocated CSS
 
 
 
 
 
 
(12,125
)
     Non-operating pension costs 
 
 
 
 
 
 
(1,544
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
120,045

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1)
$
623,138

 
4,249

 
—

 
627,387

Unallocated CSS
 
 
 
 
 
 
49,113

Capital expenditures paid
 
 
 
 
 
 
$
676,500

 
 
 
 
 
 
 
 
For the three months ended June 30, 2013
 
 
 
 
 
 
Revenue from external customers
$
1,006,822

 
597,177

 
—

 
1,603,999

Inter-segment revenue
114,436

 
—

 
(114,436
)
 
—

Total revenue
$
1,121,258

 
597,177

 
(114,436
)
 
1,603,999

 
 
 
 
 
 
 
 
Segment EBT
$
88,667

 
32,968

 
(8,690
)
 
112,945

Unallocated CSS
 
 
 
 
 
 
(10,584
)
Non-operating pension costs 
 
 
 
 
 
 
(4,999
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
97,362

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1)
$
517,131

 
5,017

 
—

 
522,148

Unallocated CSS
 
 
 
 
 
 
5,912

Capital expenditures paid
 
 
 
 
 
 
$
528,060

 ————————————
(1)
Excludes revenue earning equipment acquired under capital leases.

 
FMS
 
SCS
 
Eliminations
 
Total
 
(In thousands)
 
 
For the six months ended June 30, 2014
 
 
 
 
 
 
Revenue from external customers
$
2,070,388

 
1,224,920

 
—

 
3,295,308

Inter-segment revenue
245,921

 
—

 
(245,921
)
 
—

Total revenue
$
2,316,309

 
1,224,920

 
(245,921
)
 
3,295,308

 
 
 
 
 
 
 
 
Segment EBT
$
190,500

 
52,512

 
(20,151
)
 
222,861

Unallocated CSS
 
 
 
 
 
 
(22,954
)
     Non-operating pension costs 
 
 
 
 
 
 
(4,858
)
Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
195,049

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1), (2)
$
1,191,377

 
8,121

 
—

 
1,199,498

Unallocated CSS
 
 
 
 
 
 
55,724

Capital expenditures paid
 
 
 
 
 
 
$
1,255,222

 
 
 
 
 
 
 
 
For the six months ended June 30, 2013
 
 
 
 
 
 
Revenue from external customers
$
1,993,360

 
1,173,656

 
—

 
3,167,016

Inter-segment revenue
227,630

 
—

 
(227,630
)
 
—

Total revenue
$
2,220,990

 
1,173,656

 
(227,630
)
 
3,167,016

 
 
 
 
 
 
 
 
Segment EBT
$
149,412

 
57,404

 
(16,648
)
 
190,168

Unallocated CSS
 
 
 
 
 
 
(21,959
)
Non-operating pension costs 
 
 
 
 
 
 
(10,243
)
Restructuring and other charges, net and other items
 
 
 
 
 
 
1,904

Earnings from continuing operations before income taxes
 
 
 
 
 
 
$
159,870

 
 
 
 
 
 
 
 
Segment capital expenditures paid (1), (2)
$
923,642

 
10,817

 
—

 
934,459

Unallocated CSS
 
 
 
 
 
 
13,655

Capital expenditures paid
 
 
 
 
 
 
$
948,114

 ————————————
(1)
Excludes revenue earning equipment acquired under capital leases.
(2)
Excludes acquisition payments of $1.6 million and $1.4 million during the six months ended June 30, 2014, and 2013, respectively.
Accounting Changes (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
 
 
Deferred Tax Liabilities, Net, Noncurrent
$ 1,480,313 
$ 1,429,637 
FIN 48 [Member] |
Restatement Adjustment [Member]
 
 
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
 
 
Deferred Tax Liabilities, Net, Noncurrent
 
$ 38,800 
Discontinued Operations (Details) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Dec. 31, 2013
Loss from discontinued operations
 
 
 
 
 
Pre-tax loss from discontinued operations
$ (323,000)
$ (298,000)
$ (1,278,000)
$ (1,199,000)
 
Income tax (expense) benefit
(13,000)
(83,000)
76,000 
(60,000)
 
Loss from discontinued operations, net of tax
(336,000)
(381,000)
(1,202,000)
(1,259,000)
 
Assets:
 
 
 
 
 
Total assets, primarily deposits
3,452,000 
 
3,452,000 
 
3,627,000 
Liabilities:
 
 
 
 
 
Total liabilities, primarily contingent accruals
4,476,000 
 
4,476,000 
 
4,501,000 
Brazil Federal and Social Contribution tax [Member]
 
 
 
 
 
Liabilities:
 
 
 
 
 
Tax Amounts Assessed But Not Reserved
 
 
$ 5,300,000 
 
 
Share-Based Compensation Plans (Details) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Share-based compensation expense and income tax benefits recognized during the periods
 
 
 
 
Share-based compensation expense
$ 5,131,000 
$ 4,992,000 
$ 9,989,000 
$ 9,602,000 
Income tax benefit
(1,713,000)
(1,640,000)
(3,389,000)
(3,327,000)
Share-based compensation expense, net of tax
3,418,000 
3,352,000 
6,600,000 
6,275,000 
Summary of compensation expense recognized related to cash awards
 
 
 
 
Cash awards
743,000 
889,000 
1,266,000 
2,163,000 
Share Based Compensation Plans (Textuals) [Abstract]
 
 
 
 
Stock option plan granted
 
 
405,000 
381,000 
Total unrecognized pre-tax compensation expense
33,400,000 
 
33,400,000 
 
Unrecognized Compensation Costs weighted-average period (in years)
 
 
1 year 11 months 20 days 
 
Share-based Compensation Arrangement by Share-based Payment Award, Shares Issued in Period
 
 
615,000 
564,000 
Stock Option and Stock Purchase Plan [Member]
 
 
 
 
Share-based compensation expense and income tax benefits recognized during the periods
 
 
 
 
Share-based compensation expense
2,241,000 
2,193,000 
4,478,000 
4,303,000 
Nonvested Stock [Member]
 
 
 
 
Share-based compensation expense and income tax benefits recognized during the periods
 
 
 
 
Share-based compensation expense
$ 2,890,000 
$ 2,799,000 
$ 5,511,000 
$ 5,299,000 
Market-based restricted stock rights [Member]
 
 
 
 
Share Based Compensation Plans (Textuals) [Abstract]
 
 
 
 
Restricted stock rights and restricted stock units granted
 
 
22,000 
22,000 
Time Vested Restricted Stock [Member]
 
 
 
 
Share Based Compensation Plans (Textuals) [Abstract]
 
 
 
 
Restricted stock rights and restricted stock units granted
 
 
158,000 
146,000 
Performance based restricted stock [Member]
 
 
 
 
Share Based Compensation Plans (Textuals) [Abstract]
 
 
 
 
Restricted stock rights and restricted stock units granted
 
 
30,000 
15,000 
Earnings Per Share (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Earnings per share - Basic:
 
 
 
 
Earnings from continuing operations
$ 75,694 
$ 62,575 
$ 124,792 
$ 103,377 
Less: Distributed and undistributed earnings allocated to nonvested stock
(301)
(556)
(582)
(978)
Earnings from continuing operations available to common shareholders - Basic
75,393 
62,019 
124,210 
102,399 
Weighted average common shares outstanding - Basic
52,564 
51,445 
52,612 
51,201 
Earnings from continuing operations per common share - Basic
$ 1.43 
$ 1.21 
$ 2.36 
$ 2.00 
Earnings per share - Diluted:
 
 
 
 
Earnings from continuing operations
75,694 
62,575 
124,792 
103,377 
Less: Distributed and undistributed earnings allocated to nonvested stock
(299)
(552)
(578)
(972)
Earnings from continuing operations available to common shareholders - Diluted
$ 75,395 
$ 62,023 
$ 124,214 
$ 102,405 
Weighted average common shares outstanding - Basic
52,564 
51,445 
52,612 
51,201 
Effect of dilutive equity awards
482 
478 
472 
457 
Weighted average common shares outstanding - Diluted
53,046 
51,923 
53,084 
51,658 
Earnings from continuing operations per common share - Diluted
$ 1.42 
$ 1.19 
$ 2.34 
$ 1.98 
Anti-dilutive equity awards not included above
412 
593 
314 
1,003 
Revenue Earning Equipment (Details) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2014
Dec. 31, 2013
Summary of revenue earning equipment
 
 
 
Cost
$ 10,536,606,000 
$ 10,536,606,000 
$ 10,086,939,000 
Accumulated Depreciation
(3,606,141,000)
(3,606,141,000)
(3,596,102,000)
Net Book Value
6,930,465,000 
6,930,465,000 
6,490,837,000 
Effect of change in estimated residual values of revenue earning equipment on pre tax earnings
6,300,000 
12,500,000 
 
Held for use: Full service lease [Member]
 
 
 
Summary of revenue earning equipment
 
 
 
Cost
7,699,750,000 
7,699,750,000 
7,436,093,000 
Accumulated Depreciation
(2,564,790,000)
(2,564,790,000)
(2,537,077,000)
Net Book Value
5,134,960,000 
5,134,960,000 
4,899,016,000 
Held for use: Commercial rental [Member]
 
 
 
Summary of revenue earning equipment
 
 
 
Cost
2,491,695,000 
2,491,695,000 
2,210,863,000 
Accumulated Depreciation
(791,662,000)
(791,662,000)
(747,283,000)
Net Book Value
1,700,033,000 
1,700,033,000 
1,463,580,000 
Held-for-sale [Member]
 
 
 
Summary of revenue earning equipment
 
 
 
Cost
345,161,000 
345,161,000 
439,983,000 
Accumulated Depreciation
(249,689,000)
(249,689,000)
(311,742,000)
Net Book Value
$ 95,472,000 
$ 95,472,000 
$ 128,241,000 
Revenue Earning Equipment (Details Textuals) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2014
Dec. 31, 2013
Revenue Earning Equipment (Textuals) [Abstract]
 
 
 
Cost
$ 10,536,606,000 
$ 10,536,606,000 
$ 10,086,939,000 
Accumulated Depreciation
3,606,141,000 
3,606,141,000 
3,596,102,000 
Effect of change in estimated residual values of revenue earning equipment on pre tax earnings
6,300,000 
12,500,000 
 
Net Investment in Direct Financing and Sales Type Leases
417,800,000 
417,800,000 
400,100,000 
Financing Receivable, Allowance for Credit Losses
400,000 
400,000 
500,000 
Assets Held under Capital Leases [Member]
 
 
 
Revenue Earning Equipment (Textuals) [Abstract]
 
 
 
Cost
48,100,000 
48,100,000 
54,200,000 
Accumulated Depreciation
$ 20,100,000 
$ 20,100,000 
$ 22,000,000 
Goodwill (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Carrying amount of goodwill attributable to each reportable business segment
 
 
Goodwill, Gross
$ 413,100 
$ 412,940 
Accumulated impairment losses
(29,221)
(29,221)
Goodwill
383,879 
383,719 
Foreign currency translation adjustment
160 
 
Fleet Management Solutions [Member]
 
 
Carrying amount of goodwill attributable to each reportable business segment
 
 
Goodwill, Gross
223,401 
223,204 
Accumulated impairment losses
(10,322)
(10,322)
Goodwill
213,079 
212,882 
Foreign currency translation adjustment
197 
 
Supply Chain Solutions [Member]
 
 
Carrying amount of goodwill attributable to each reportable business segment
 
 
Goodwill, Gross
189,699 
189,736 
Accumulated impairment losses
(18,899)
(18,899)
Goodwill
170,800 
170,837 
Foreign currency translation adjustment
$ (37)
 
Accrued Expenses and Other Liabilities (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Accrued Expenses and Other Liabilities
 
 
Salaries and wages, Accrued Expenses
$ 87,951 
$ 106,281 
Salaries and wages, Non-Current Liabilities
0 
0 
Salaries and wages, Total
87,951 
106,281 
Deferred compensation, Accrued Expenses
2,966 
2,505 
Deferred compensation, Non-Current Liabilities
34,123 
31,896 
Deferred compensation, Total
37,089 
34,401 
Other employee benefits, Accrued Expenses
6,060 
3,809 
Other employee benefits, Non-Current Liabilities
4,271 
6,712 
Other employee benefits, Total
10,331 
10,521 
Pension benefits, Accrued Expenses
3,606 
3,660 
Pension benefits, Non-Current Liabilities
239,904 
292,155 
Pension benefits, Total
243,510 
295,815 
Other postretirement benefits, Accrued Expenses
2,413 
2,414 
Other postretirement benefits, Non-Current Liabilities
27,481 
28,374 
Other postretirement benefits, Total
29,894 
30,788 
Insurance obligations, Accrued Expenses
131,763 
125,835 
Insurance obligations, Non-Current Liabilities
189,595 
186,700 
Insurance obligations, Total
321,358 
312,535 
Accrued rent, Accrued Expenses
2,102 
4,373 
Accrued rent, Non-Current Liabilities
2,222 
3,372 
Accrued rent, Total
4,324 
7,745 
Environmental liabilities, Accrued Expenses
4,018 
4,515 
Environmental liabilities, Non-Current Liabilities
8,828 
8,548 
Environmental liabilities, Total
12,846 
13,063 
Asset retirement obligations, Accrued Expenses
5,049 
6,144 
Asset retirement obligations, Non-Current Liabilities
19,689 
19,403 
Asset retirement obligations, Total
24,738 
25,547 
Operating taxes, Accrued Expenses
96,657 
94,188 
Operating taxes, Non-Current Liabilities
0 
0 
Operating taxes, Total
96,657 
94,188 
Income taxes, Accrued Expenses
284 
2,623 
Income taxes, Non-Current Liabilities
25,552 
23,813 
Income taxes, Total
25,836 
26,436 
Interest, Accrued Expenses
30,968 
33,654 
Interest, Non-Current Liabilities
0 
0 
Interest, Total
30,968 
33,654 
Deposits, mainly from customers, Accrued Expenses
56,411 
55,854 
Deposits, mainly from customers, Non-Current Liabilities
6,175 
6,239 
Deposits, mainly from customers, Total
62,586 
62,093 
Deferred revenue, Accrued Expenses
14,652 
15,123 
Deferred revenue, Non-Current Liabilities
0 
0 
Deferred Revenue, Total
14,652 
15,123 
Other, Accrued Expenses
34,147 
35,359 
Other, Non-Current Liabilities
8,402 
9,093 
Other, Total
42,549 
44,452 
Total, Accrued Expenses
479,047 
496,337 
Total, Non-Current Liabilities
566,242 
616,305 
Total
$ 1,045,289 
$ 1,112,642 
Debt (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Short-term debt and current portion of long-term debt:
 
 
Short-term debt, Weighted Average Interest Rate
1.28% 
1.70% 
Short-term debt
$ 1,604 
$ 1,315 
Current portion of long-term debt, including capital leases
412,077 
258,123 
Short-term debt and current portion of long-term debt
557,681 
259,438 
USCommercialPaperShortTerm [Member]
 
 
Short-term debt and current portion of long-term debt:
 
 
Commercial Paper
$ 144,000 
$ 0 
Debt (Details 1) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Debt Instrument [Line Items]
 
 
Short-term Debt, Weighted Average Interest Rate
1.28% 
1.70% 
Short-term Debt
$ 1,604 
$ 1,315 
Long-term debt:
 
 
Commercial paper
375,949 
498,236 
Unsecured U.S. notes - Medium-term notes
3,771,238 
3,271,734 
Unsecured U.S. obligations, principally bank term loans
55,500 
55,500 
Unsecured foreign obligations
324,423 
315,558 
Capital lease obligations
36,584 
38,911 
Total before fair market value adjustment
4,563,694 
4,179,939 
Fair market value adjustment on notes subject to hedging
7,855 
8,171 
Total after fair market value adjustment
4,571,549 
4,188,110 
Current portion of long-term debt, including capital leases
(412,077)
(258,123)
Short-term debt and current portion of long-term debt
557,681 
259,438 
Long-term debt
4,159,472 
3,929,987 
Total debt
4,717,153 
4,189,425 
USCommercialPaperShortTerm [Member]
 
 
Debt Instrument [Line Items]
 
 
Short-term Debt, Weighted Average Interest Rate
0.26% 
0.00% 
Unsecured Medium Term Notes Due 2019 [Member]
 
 
Debt Instrument [Line Items]
 
 
Debt Instrument, Call Feature
101% of principal plus accrued and unpaid interest 
 
U.S Commercial Paper, Long-Term [Member]
 
 
Long-term debt:
 
 
Long-term debt, Weighted Average Interest Rate
0.26% 
0.28% 
Maturity date range, end
Oct. 18, 2018 
 
Commercial paper
375,949 
486,939 
Canadian Commerial Paper [Member]
 
 
Long-term debt:
 
 
Long-term debt, Weighted Average Interest Rate
0.00% 
1.13% 
Maturity date range, end
Oct. 18, 2018 
 
Commercial paper
0 
11,297 
Global Revolving Credit Facility Member
 
 
Long-term debt:
 
 
Maturity date range, end
Oct. 18, 2018 
 
Unsecured U.S. notes - Medium-term notes, Long-Term [Member]
 
 
Long-term debt:
 
 
Long-term debt, Weighted Average Interest Rate
3.29% 
3.76% 
Maturity date range, start
Mar. 01, 2015 
 
Maturity date range, end
Feb. 25, 2025 
 
Unsecured U.S. obligations, principally bank term loans, Long-Term [Member]
 
 
Long-term debt:
 
 
Long-term debt, Weighted Average Interest Rate
1.44% 
1.45% 
Maturity date range, start
Mar. 08, 2015 
 
Maturity date range, end
Mar. 19, 2018 
 
Unsecured Foreign Obligations, Long-Term [Member]
 
 
Long-term debt:
 
 
Long-term debt, Weighted Average Interest Rate
1.99% 
1.99% 
Maturity date range, start
Mar. 01, 2015 
 
Maturity date range, end
Sep. 06, 2016 
 
Capital Lease Obligations, Long-Term [Member]
 
 
Long-term debt:
 
 
Long-term debt, Weighted Average Interest Rate
3.69% 
3.81% 
Maturity date range, start
May 24, 2014 
 
Maturity date range, end
Dec. 28, 2019 
 
USCommercialPaperShortTerm [Member]
 
 
Debt Instrument [Line Items]
 
 
Commercial Paper
$ 144,000 
$ 0 
Debt (Details Textuals) (USD $)
6 Months Ended 6 Months Ended 6 Months Ended 6 Months Ended 6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Letter of Credit [Member]
Jun. 30, 2014
Global Revolving Credit Facility [Member]
May 6, 2014
Unsecured Medium Term Notes Due September 2019 [Domain]
Jun. 30, 2014
U.S Commercial Paper, Long-Term [Member]
Dec. 31, 2013
U.S Commercial Paper, Long-Term [Member]
Jun. 30, 2014
Canadian Commerial Paper [Member]
Dec. 31, 2013
Canadian Commerial Paper [Member]
Jun. 30, 2014
Global Revolving Credit Facility Member
Jun. 30, 2014
Unsecured Us Notes Medium Term Notes Long Term [Member]
Jun. 30, 2014
Unsecured Us Obligations Principally Bank Term Loans Long Term [Member]
Jun. 30, 2014
Unsecured Foreign Obligations Long Term [Member]
Jun. 30, 2014
Capital Lease Obligations [Member]
Jun. 30, 2014
Unsecured Medium Term Notes Due 2019 [Member]
Feb. 25, 2014
Unsecured Medium Term Notes Due 2019 [Member]
Jun. 30, 2014
USCommercialPaperShortTerm [Member]
Dec. 31, 2013
USCommercialPaperShortTerm [Member]
Jun. 30, 2014
Short-term Debt [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Maturity Date Range, Start
 
 
 
 
 
 
 
 
 
 
Mar. 01, 2015 
Mar. 08, 2015 
Mar. 01, 2015 
May 24, 2014 
 
 
 
 
Jun. 18, 2014 
Debt Instrument, Maturity Date Range, End
 
 
 
 
 
Oct. 18, 2018 
 
Oct. 18, 2018 
 
Oct. 18, 2018 
Feb. 25, 2025 
Mar. 19, 2018 
Sep. 06, 2016 
Dec. 28, 2019 
 
 
 
 
Jun. 18, 2014 
Unamortized original issue discounts
$ 8,800,000 
$ 8,300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Aggregate notional amount of interest rate swaps
600,000,000 
400,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Line of Credit Facility [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maximum borrowing capacity under global revolving credit facility
 
 
75,000,000 
900,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of lending institutions
12 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Letter of credit outstanding amount
 
 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Annual facility fees minimum
0.08 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Annual facility fees maximum
0.275 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Global revolving credit facility covenant terms, debt to consolidated tangible net worth ratio
less than or equal to 300% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt to consolidated tangible net worth ratio
194.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Line of Credit Facility, Remaining Borrowing Capacity
380,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt (Textuals) [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial paper classified as long term debt
375,949,000 
498,236,000 
 
 
 
375,949,000 
486,939,000 
0 
11,297,000 
 
 
 
 
 
 
 
 
 
 
Commercial Paper
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
144,000,000 
0 
 
Face amount of unsecured medium-term notes issued
 
 
 
 
400,000,000 
 
 
 
 
 
 
 
 
 
 
350,000,000 
 
 
 
Repurchase price condition of notes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
101% of principal plus accrued and unpaid interest 
 
 
 
 
Total available proceeds under trade receivables purchase and sale program
175,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of days under trade trade receivables purchase and sale program
364 days 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Trade Receivables Purchase And Sale Program Amounts Outstanding
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Global Revolving Credit Facility Unused Capacity Commitment Fee Percent
12.50% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Letters Of Credit And Surety Bonds Outstanding
$ 310,700,000 
$ 310,500,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair Value Measurements (Details) (USD $)
In Thousands, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Prepaid Expenses and Other Current Assets [Member]
 
 
Assets and liabilities measured at fair value on a recurring basis
 
 
Interest rate swaps, assets
$ 1,834 
$ 0 
Direct Financing Leases and Other Assets [Member]
 
 
Assets and liabilities measured at fair value on a recurring basis
 
 
Interest rate swaps, assets
6,162 
9,333 
Other Noncurrent Liabilities [Member]
 
 
Assets and liabilities measured at fair value on a recurring basis
 
 
Interest Rate Derivative Liabilities, at Fair Value
$ 141 
$ 1,162 
Fair Value Measurements (Details 1) (USD $)
3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trucks [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trucks [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trucks [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trucks [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Tractors [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Tractors [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Tractors [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Tractors [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trailers [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trailers [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trailers [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Revenue earning equipment, Trailers [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Revenue earning equipment, Trucks [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Revenue earning equipment, Trucks [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Revenue earning equipment, Tractors [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Revenue earning equipment, Tractors [Member]
Jun. 30, 2014
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Revenue earning equipment, Trailers [Member]
Jun. 30, 2013
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Inputs, Level 3 [Member]
Revenue earning equipment, Trailers [Member]
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets held for sale at fair value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 17,267,000 
$ 28,297,000 
$ 10,713,000 
$ 11,132,000 
$ 6,057,000 
$ 16,283,000 
$ 497,000 
$ 882,000 
Total Losses
 
 
2,515,000 
4,230,000 
6,190,000 
8,951,000 
1,572,000 
2,447,000 
3,454,000 
5,476,000 
662,000 
1,413,000 
2,294,000 
2,508,000 
281,000 
370,000 
442,000 
967,000 
 
 
 
 
 
 
 
 
Fair Value Measurements (Textuals) (Abstract)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair value of total debt
$ 4,830,000,000 
$ 4,280,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivatives (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended 6 Months Ended 6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Interest rate swaps maturing June 2017 [Member]
Jun. 30, 2013
Interest rate swaps maturing June 2017 [Member]
Jun. 30, 2014
Interest rate swaps maturing March 2015 [Member]
Jun. 30, 2013
Interest rate swaps maturing March 2015 [Member]
Jun. 30, 2014
Interest Rate Swaps Maturing November Two Thousand Eighteeen [Member] [Domain]
Jun. 30, 2014
Interest Rate Swaps Maturing June Two Thousand Nineteen [Member]
Jun. 30, 2014
Interest Rate Swaps Maturing September Two Thousand Nineteen [Domain]
Summary Of Derivative Instruments And Hedged Items [Abstract]
 
 
 
 
 
 
 
 
 
Issuance date
 
 
May 24, 2011 
 
Feb. 24, 2011 
 
Nov. 12, 2013 
Feb. 25, 2014 
May 06, 2014 
Maturity date
 
 
Jun. 01, 2017 
 
Mar. 02, 2015 
 
Nov. 15, 2018 
Jun. 01, 2019 
Sep. 03, 2019 
Face value of medium - term notes
 
 
$ 350,000 
 
$ 350,000 
 
$ 300,000 
$ 350,000 
$ 400,000 
Aggregate notional amount of interest rate swaps
$ 600,000 
$ 400,000 
$ 150,000 
 
$ 150,000 
 
$ 100,000 
$ 100,000 
$ 100,000 
Fixed interest rate
 
 
3.50% 
 
3.15% 
 
2.45% 
2.55% 
2.45% 
Weighted-average variable interest rate on hedged debt
 
 
1.42% 
1.51% 
1.28% 
1.41% 
1.18% 
1.10% 
0.85% 
Derivatives (Details 1) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended 3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Interest expense [Member]
Interest rate swap [Member]
Jun. 30, 2013
Interest expense [Member]
Interest rate swap [Member]
Jun. 30, 2014
Interest expense [Member]
Interest rate swap [Member]
Jun. 30, 2013
Interest expense [Member]
Interest rate swap [Member]
Jun. 30, 2014
Interest expense [Member]
Fixed-rate debt [Member]
Jun. 30, 2013
Interest expense [Member]
Fixed-rate debt [Member]
Jun. 30, 2014
Interest expense [Member]
Fixed-rate debt [Member]
Jun. 30, 2013
Interest expense [Member]
Fixed-rate debt [Member]
Jun. 30, 2014
Prepaid Expenses and Other Current Assets [Member]
Dec. 31, 2013
Prepaid Expenses and Other Current Assets [Member]
Jun. 30, 2014
Direct Financing Leases and Other Assets [Member]
Dec. 31, 2013
Direct Financing Leases and Other Assets [Member]
Jun. 30, 2014
Other Noncurrent Liabilities [Member]
Dec. 31, 2013
Other Noncurrent Liabilities [Member]
Derivative Instruments, Gain (Loss) [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Rate Fair Value Hedge Asset at Fair Value
 
 
 
 
 
 
 
 
 
 
 
 
$ 1,834 
$ 0 
$ 6,162 
$ 9,333 
 
 
Location and amount of gains (losses) on derivative instruments and related hedged items
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative: Interest rate swap
 
 
 
 
1,667 
(3,586)
(316)
(6,367)
 
 
 
 
 
 
 
 
 
 
Hedged item: Fixed-rate debt
 
 
 
 
 
 
 
 
(1,667)
3,586 
316 
6,367 
 
 
 
 
 
 
Total
0 
0 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Rate Derivative Liabilities, at Fair Value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 141 
$ 1,162 
Share Repurchase Programs (Details) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2014
Accelerated Share Repurchases [Line Items]
 
 
Aggregate cost of repurchased and retired
 
$ 79,488 
December 2011 Anti-Dilutive Share Repurchase Program [Domain]
 
 
Accelerated Share Repurchases [Line Items]
 
 
Maximum number of share repurchases authorization
2,000,000 
2,000,000 
December 2013 Anti-Dilutive Share Repurchase Program [Member]
 
 
Accelerated Share Repurchases [Line Items]
 
 
Maximum number of share repurchases authorization
2,000,000 
2,000,000 
Aggregate cost of repurchased and retired
39,050 
79,488 
Common Stock [Member]
 
 
Accelerated Share Repurchases [Line Items]
 
 
Repurchased and retired shares
464,389 
1,027,072 
Aggregate cost of repurchased and retired
 
$ 514 
Accumulated Other Comprehensive Loss (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Accumulated Translation Adjustment [Member]
Jun. 30, 2013
Accumulated Translation Adjustment [Member]
Jun. 30, 2014
Accumulated Defined Benefit Plans Adjustment, Net Unamortized Gain (Loss) [Member]
Jun. 30, 2013
Accumulated Defined Benefit Plans Adjustment, Net Unamortized Gain (Loss) [Member]
Jun. 30, 2014
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Cost (Credit) [Member]
Jun. 30, 2013
Accumulated Defined Benefit Plans Adjustment, Net Prior Service Cost (Credit) [Member]
Jun. 30, 2014
Accumulated Other Comprehensive Income (Loss) [Member]
Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Member]
Accumulated Other Comprehensive (Loss) [Roll Forward]
 
 
 
 
 
 
 
 
 
 
Accumulated other comprehensive loss, beginning of period
$ (422,495)
$ (438,248)
$ 35,875 
$ 57,860 
$ (477,883)
$ (648,113)
$ 3,760 
$ 2,634 
$ (438,248)
$ (587,619)
Other Comprehensive (Income) Loss, Amortization Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, for Net Actuarial Loss (Gain), Net of Tax
 
 
 
 
7,455 
11,514 
(1,335)
(697)
6,120 
10,817 
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, for Net Gain (Loss), Net of Tax
 
 
11,681 
(49,943)
(2,048)
(3,714)
0 
0 
9,633 
(53,657)
Accumulated other comprehensive loss, end of period
$ (422,495)
$ (438,248)
$ 47,556 
$ 7,917 
$ (472,476)
$ (640,313)
$ 2,425 
$ 1,937 
$ (422,495)
$ (630,459)
Employee Benefit Plans (Details) (USD $)
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Amortization of:
 
 
 
 
Contribution to pension plans
 
 
$ 65,000,000 
 
Defined Benefit Plan, Estimated Future Employer Contributions in Current Fiscal Year
 
 
75,000,000 
 
Pension Benefits [Member]
 
 
 
 
Amortization of:
 
 
 
 
Net periodic benefit cost
6,289,000 
9,971,000 
14,423,000 
20,592,000 
Company Administered Plan [Member] |
Pension Benefits [Member]
 
 
 
 
Components of net periodic benefit cost
 
 
 
 
Service cost
3,171,000 
3,756,000 
6,594,000 
8,008,000 
Interest Cost
25,135,000 
22,316,000 
50,696,000 
44,735,000 
Expected Return on Plan Assets
(29,284,000)
(26,389,000)
(58,002,000)
(52,837,000)
Amortization of:
 
 
 
 
Net actuarial loss (credit)
5,579,000 
8,685,000 
11,814,000 
17,565,000 
Prior service credit
(435,000)
(443,000)
(893,000)
(909,000)
Net periodic benefit cost
4,166,000 
7,925,000 
10,209,000 
16,562,000 
Company Administered Plan [Member] |
Pension Benefits U.S. [Member]
 
 
 
 
Amortization of:
 
 
 
 
Net periodic benefit cost
4,499,000 
8,152,000 
10,786,000 
16,893,000 
Company Administered Plan [Member] |
Pension Benefits Non-U.S. [Member]
 
 
 
 
Amortization of:
 
 
 
 
Net periodic benefit cost
(333,000)
(227,000)
(577,000)
(331,000)
Company Administered Plan [Member] |
Postretirement Benefits [Member]
 
 
 
 
Components of net periodic benefit cost
 
 
 
 
Service cost
89,000 
230,000 
224,000 
493,000 
Interest Cost
348,000 
392,000 
713,000 
787,000 
Amortization of:
 
 
 
 
Net actuarial loss (credit)
(234,000)
(5,000)
(363,000)
(7,000)
Prior service credit
(615,000)
(57,000)
(1,230,000)
(115,000)
Net periodic benefit cost
(412,000)
560,000 
(656,000)
1,158,000 
Company Administered Plan [Member] |
Postretirement Benefits U.S [Member]
 
 
 
 
Amortization of:
 
 
 
 
Net periodic benefit cost
(524,000)
402,000 
(921,000)
808,000 
Company Administered Plan [Member] |
Postretirement Benefits Non-U.S [Member]
 
 
 
 
Amortization of:
 
 
 
 
Net periodic benefit cost
112,000 
158,000 
265,000 
350,000 
Union Administered Plan [Member] |
Pension Benefits [Member]
 
 
 
 
Amortization of:
 
 
 
 
Net periodic benefit cost
$ 2,123,000 
$ 2,046,000 
$ 4,214,000 
$ 4,030,000 
Other Items (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Other Items Impacting Comparability [Abstract]
 
 
 
 
Foreign currency translation benefit (1)
$ 0 
$ 0 
$ 0 
$ 1,904 
Supplemental Cash Flow Information (Details) (USD $)
In Thousands, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Other Significant Noncash Transactions [Line Items]
 
 
Payments to Acquire Businesses, Net of Cash Acquired
$ 1,649 
$ 1,420 
Supplemental cash flow information
 
 
Interest Paid
68,974 
67,545 
Income taxes paid
7,332 
8,447 
Changes in accounts payable related to purchases of revenue earning equipment
1,520 
40,389 
Operating and revenue earning equipment acquired under capital leases
2,371 
4,814 
Other Acquisitions Completed in Prior Years [Member]
 
 
Other Significant Noncash Transactions [Line Items]
 
 
Payments to Acquire Businesses, Net of Cash Acquired
$ 1,649 
$ 1,420 
Miscellaneous Income, Net (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
MiscellaneousIncome [Abstract]
 
 
 
 
Contract settlement
$ 0 
$ 0 
$ 2,908 
$ 0 
Gains on sales of operating property and equipment
1,286 
267 
2,590 
540 
Gain on Business Interruption Insurance Recovery
756 
1,805 
756 
1,805 
Foreign currency translation benefit (1)
0 
0 
0 
1,904 
Rabbi trust investment income
1,077 
172 
1,577 
1,631 
Other, net
1,709 
1,331 
2,379 
2,265 
Total
$ 4,828 
$ 3,575 
$ 10,210 
$ 8,145 
Segment Reporting (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Financial information of business segments
 
 
 
 
Total revenues
$ 1,684,571 
$ 1,603,999 
$ 3,295,308 
$ 3,167,016 
Segment NBT
133,714 
112,945 
222,861 
190,168 
Unallocated CSS
(12,125)
(10,584)
(22,954)
(21,959)
Non-service pension costs
(1,544)
(4,999)
(4,858)
(10,243)
Restructuring And Other Charges Net And Other Items
 
 
 
1,904 
Earnings from continuing operations before income taxes
120,045 
97,362 
195,049 
159,870 
Segment capital expenditures
627,387 
522,148 
1,199,498 
934,459 
Unallocated CSS
49,113 
5,912 
55,724 
13,655 
Capital expenditures paid
676,500 
528,060 
1,255,222 
948,114 
Segment Reporting (Textuals) [Abstract]
 
 
 
 
Acquisitions
 
 
(1,649)
(1,420)
Fleet Management Solutions [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
1,056,992 
1,006,822 
2,070,388 
1,993,360 
Segment NBT
113,509 
88,667 
190,500 
149,412 
Segment capital expenditures
623,138 
517,131 
1,191,377 
923,642 
Supply Chain Solutions [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
627,579 
597,177 
1,224,920 
1,173,656 
Segment NBT
30,728 
32,968 
52,512 
57,404 
Segment capital expenditures
4,249 
5,017 
8,121 
10,817 
Eliminations [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
0 
0 
0 
0 
Segment NBT
(10,523)
(8,690)
(20,151)
(16,648)
Segment capital expenditures
0 
0 
0 
0 
Intersegment Eliminations [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
0 
0 
0 
0 
Intersegment Eliminations [Member] |
Fleet Management Solutions [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
124,230 
114,436 
245,921 
227,630 
Intersegment Eliminations [Member] |
Supply Chain Solutions [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
0 
0 
0 
0 
Intersegment Eliminations [Member] |
Eliminations [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
(124,230)
(114,436)
(245,921)
(227,630)
Operating Segments [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
1,684,571 
1,603,999 
3,295,308 
3,167,016 
Operating Segments [Member] |
Fleet Management Solutions [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
1,181,222 
1,121,258 
2,316,309 
2,220,990 
Operating Segments [Member] |
Supply Chain Solutions [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
627,579 
597,177 
1,224,920 
1,173,656 
Operating Segments [Member] |
Eliminations [Member]
 
 
 
 
Financial information of business segments
 
 
 
 
Total revenues
$ (124,230)
$ (114,436)
$ (245,921)
$ (227,630)