<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(X) ANNUAL REPORT PURSUANT TO SECTION 15d OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ____________
Commission file number 0-11757
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
J.B. HUNT TRANSPORT SERVICES, INC. EMPLOYEE RETIREMENT PLAN
615 J.B. HUNT CORPORATE DRIVE
LOWELL, ARKANSAS 72745
B. Namer of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
J.B. HUNT TRANSPORT SERVICES, INC.
615 J.B. HUNT CORPORATE DRIVE
LOWELL, ARKANSAS 72745
(501) 820-0000
<PAGE>
REQUIRED INFORMATION
The following financial statements prepared in accordance with the financial
reporting requirements of ERISA and exhibits are filed for the J.B. Hunt
Transport Services, Inc. Employee Retirement Plan:
FINANCIAL STATEMENTS AND SCHEDULES
Independent Auditors' Report
Statements of Net Assets Available for Benefits, December 31, 1997, and 1996
Statements of Changes in Net Assets Available for Benefits, Years Ended
December 31, 1997, and 1996
Notes to Financial Statements, December 31, 1997, and 1996
Item 27(a) - Schedule of Assets Held for Investment Purposes, December 31, 1997
Item 27(d) - Schedule of Reportable Transactions, Year Ended December 31, 1997
EXHIBIT
23 - Independent Auditors' Consent
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
DATE: 7/7/98 BY: /s/ Jerry W. Walton
--------------------------------------------
Jerry W. Walton
Executive Vice President Finance
Chief Financial Officer of J.B. Hunt Transport
Services, Inc.
Administrator of the Retirement Plan and
member of Retirement Plan Investment
Committee
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Financial Statements and Schedules
December 31, 1997 and 1996
(With Independent Auditors' Report Thereon)
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
TABLE OF CONTENTS
<TABLE>
PAGE
<S> <C>
Independent Auditors' Report 1
Statements of Net Assets Available for Benefits -
December 31, 1997 and 1996 2
Statements of Changes in Net Assets Available for Benefits -
Years ended December 31, 1997 and 1996 3
Notes to Financial Statements 4
Item 27(a) - Schedule of Assets Held for Investment Purposes -
December 31, 1997 15
Item 27(d) - Schedule of Reportable Transactions - Year ended
December 31, 1997 16
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Trustees
J.B. Hunt Transport Services, Inc.
Employee Retirement Plan:
We have audited the accompanying statements of net assets available for benefits
of J.B. Hunt Transport Services, Inc. Employee Retirement Plan ("Plan") as of
December 31, 1997 and 1996, and the related statements of changes in net assets
available for benefits for the years then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of J.B. Hunt
Transport Services, Inc. Employee Retirement Plan as of December 31, 1997 and
1996, and the changes in net assets available for benefits for the years then
ended in conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets
held for investment purposes and reportable transactions are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. The supplemental schedules
have been subjected to the auditing procedures applied in the audits of the
basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
KPMG Peat Marwick LLP
Little Rock, Arkansas
April 17, 1998
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Statements of Net Assets Available for Benefits
December 31, 1997 and 1996
<TABLE>
1997 1996
(NOTE 7) (NOTE 7)
-------- --------
<S> <C> <C>
Investments (note 3):
Guaranteed interest account $ 33,110,366 28,093,347
Mutual funds 55,076,429 37,365,983
Common stock - J.B. Hunt Transport Services, Inc. 7,246,428 4,039,927
Guaranteed investment contracts - 2,524,559
Participant notes receivable 9,584,738 7,542,885
------------ ----------
Total investments 105,017,961 79,566,701
------------ ----------
Receivables:
Contributions:
Employer 123,105 76,377
Employee 373,858 289,191
Accrued investment income 14,896 7,925
------------ ----------
Total receivables 511,859 373,493
------------ ----------
Total assets 105,529,820 79,940,194
Corrective distributions payable to participants (note 6) 102,706 134,777
------------ ----------
Net assets available for benefits $105,427,114 79,805,417
------------ ----------
------------ ----------
</TABLE>
See accompanying notes to financial statements.
2
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Statements of Changes in Net Assets Available for Benefits
Years ended December 31, 1997 and 1996
<TABLE>
1997 1996
(NOTE 7) (NOTE 7)
-------- --------
<S> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value of investments (note 3) $ 9,711,985 4,018,600
Interest and dividends 3,480,515 2,829,239
------------ ----------
13,192,500 6,847,839
------------ ----------
Contributions:
Employer 6,444,406 3,209,836
Participants 16,038,066 14,134,686
------------ ----------
22,482,472 17,344,522
------------ ----------
Total additions 35,674,972 24,192,361
------------ ----------
Deductions from net assets attributed to:
Benefits paid to participants 6,617,769 5,568,256
Administrative expenses 68,380 57,462
Transfers to other plans 3,367,126 4,011,036
------------ ----------
Total deductions 10,053,275 9,636,754
------------ ----------
Increase in net assets available for benefits 25,621,697 14,555,607
Net assets available for benefits:
Beginning of year 79,805,417 65,249,810
------------ ----------
End of year $105,427,114 79,805,417
------------ ----------
------------ ----------
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
(1) DESCRIPTION OF PLAN
The following brief description of the J.B. Hunt Transport Services, Inc.
("Company" or "Employer") Employee Retirement Plan ("Plan") is provided
for general information purposes only. Participants should refer to the
Plan agreement for a more complete description of the Plan's provisions.
(a) GENERAL
The purpose of the Plan is to provide additional incentive and
retirement security for eligible employees of the Company by
permitting contributions to the Plan that are tax deferred under
Section 401(k) of the Internal Revenue Code. The Plan covers all
participants from a prior plan as of December 31, 1994, and each
current employee of the Company as of the first day of the payroll
period coincident with or immediately following the date he or she has
completed one year of eligibility service. Beginning January 1, 1998,
employees will be eligible to participate immediately upon employment.
The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA"). At December 31, 1997, the Plan
had 10,051 participants of which 8,464 were active.
(b) CONTRIBUTIONS
Each year, participants may defer up to 16% of pretax annual
compensation, as defined in the Plan agreement (not to exceed limits
determined under Section 415(c) of the Internal Revenue Code). The
Company contributes 100% of the first one percent of base compensation
that a participant contributes to the Plan. Additionally, the Company
contributes 50% of the next two percent of base compensation that a
participant contributes to the Plan.
Effective January 1, 1997, the Plan amended the Employer matching
contributions as follows:
<TABLE>
PARTICIPANTS' SALARY EMPLOYER
REDUCTION CONTRIBUTION MATCHING
---------------------- --------
<S> <C>
1% .5%
2% 1%
3% 1.5%
4% 2%
5% 2.5%
6% - 16% 3%
</TABLE>
Additional amounts may be contributed at the option of the Company's board
of directors. No such additional amounts were contributed in 1997 or 1996.
(CONTINUED)
4
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
(c) PARTICIPANT'S ACCOUNTS
Each participant's account is credited with the participant's contribution
and allocations of (a) the Company's contribution and (b) Plan earnings.
Forfeited balances of terminated participants' nonvested accounts are used
to reduce future Company contributions. Forfeitures for the years ended
December 31, 1997 and 1996 amounted to approximately $389,000 and $217,000,
respectively, and were reallocated to accounts of existing participants in
the subsequent fiscal year.
(d) VESTING
Participants are immediately vested in their contributions plus actual
earnings thereon. Vesting in the Company's matching and discretionary
contribution portion of their accounts plus actual earnings thereon is
based on years of service. Upon a participant's normal retirement,
disability or death, he or she becomes fully vested in the Plan. If a
participant terminates employment for any other reason on or after being
credited with at least five years of vesting service, he or she becomes
fully vested in the Plan. Prior to the completion of five years of vesting
service, the vesting percentages are as follows: 0 - 3 years - 0%; 3 - 4
years - 50%; 4 - 5 years - 75%.
(e) INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct employee
contributions in any of the following investment options:
GUARANTEED INTEREST ACCOUNT - A group annuity insurance product issued
by Prudential Insurance Company of America ("Prudential").
Contributions are invested in fixed income securities having short to
intermediate maturities with the objective of providing stable,
competitive interest rates based on current market conditions. A
current interest rate is declared on each successive calendar quarter.
That announced rate stays in effect through the end of the following
calendar year for contributions received during that calendar quarter.
The guaranteed rates for 1997 ranged from 6.0% to 6.7%.
J.B. HUNT COMPANY STOCK FUND - Contributions are invested
exclusively in Company common stock.
MUTUAL FUNDS
a. Longleaf Partners Fund - Southeastern Asset Management ("SAM") is
the fund manager and invests in common stocks of a limited number
of companies which SAM believes to have unrecognized intrinsic
value with the objective of providing long-term capital
appreciation.
(Continued)
5
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
b. Active Balanced Fund - Jennison Associates Capital Corp. ("Jennison")
is the fund manager and invests in a mix of equity securities,
investment grade income securities and money market instruments with
the objective of providing total returns approaching those of an
equity portfolio but with less risk.
c. International Stock Fund - Mercator Asset Management, L.P.
("Mercator") is the fund manager and invests in equity securities of
companies that are incorporated, organized, or that do business
outside of the United States with the objective of providing long-term
growth of capital.
d. Money Mart Assets - Prudential Management Fund, Inc. ("PMF") is the
fund manager and invests in U.S. Government and agency obligations,
bank certificates of deposit and commercial paper with the objective
of providing maximum current income consistent with stability of
capital and the maintenance of liquidity.
e. Government Income Fund - PMF is the fund manager and invests in
intermediate and long-term U.S. Government and agency obligations with
the objective of providing high current income.
f. Jennison Growth Fund - PMF is the fund manager and invests in equity
securities of companies that exceed $1 billion in market
capitalization with the objective of providing long-term growth of
capital. Jennison furnishes investment advisory services under a
Subadvisory Agreement with PMF.
g. New Opportunities Fund - Putman Investment Management, Inc. is the
fund manager and invests in debt and equity securities with the
objective of providing long-term capital appreciation.
h. Stock Index Fund - Prudential Diversified Investment Strategies is the
fund manager and invests in a broad mix of equity securities that
provide investment results that correspond to the price and yield
performance of the Standard & Poor's 500 Composite Price Index.
During 1997, funds invested in a Transfer Guaranteed Fund were transferred to
the Guaranteed Interest Account fund.
During 1996, funds previously invested in a Growth Stock Fund, Income Fund and
Money Market Fund were transferred into the Jennison Growth Fund, Government
Income Fund and Money Mart Assets Fund, respectively.
(Continued)
6
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
(f) PARTICIPANT NOTES RECEIVABLE
Participants may borrow from their fund accounts a minimum of $1,000
up to a maximum equal to the lesser of $50,000 or 50 percent of their
vested account balance. Loan terms range from 1 - 5 years or up to 20
years for the purchase of a primary residence. The loans are secured
by the balance in the participant's account and bear interest at the
prime rate, as shown in the Wall Street Journal, plus one percent,
(9.50% at December 31, 1997). Principal and interest is paid ratably
through monthly payroll deductions.
(g) TRANSFERS TO OTHER PLANS
During the years ended December 31, 1997 and 1996, respectively, the
Plan transferred certain net assets to other plans in connection with
participants who have terminated employment and began participating in
other employer plans. Such transfers are recorded at the fair value
of the assets on the date transferred.
(h) PAYMENT OF BENEFITS
On termination of service due to normal retirement, disability or
death, a participant will receive a lump-sum amount in cash equal to
the value of the participant's vested interest in his or her account.
At December 31, 1997 and 1996, approximately $5,826,000 and
$5,615,000, respectively, of the net assets available for benefits as
shown on the statements of net assets available for benefits are
allocated to accounts of terminated employees who have withdrawn from
participation in the Plan.
(i) RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits
per the financial statements to the Form 5500:
<TABLE>
DECEMBER 31,
---------------------------
1997 1996
---- ----
<S> <C> <C>
Net assets available for benefits per
the financial statements $105,427,114 79,805,417
Amounts allocated to withdrawing
participants (5,826,000) (5,615,000)
------------ ----------
Net assets available for benefits per
the Form 5500 $ 99,601,114 74,190,417
------------ ----------
------------ ----------
</TABLE>
(CONTINUED)
7
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) BASIS OF PRESENTATION
The accompanying financial statements of the Plan are prepared under
the accrual method of accounting.
(b) INVESTMENT VALUATION
The Plan's investments are valued at fair value on December 31, 1997
and 1996. Purchases and sales of securities are recorded on a
trade-date basis. The fair value for shares of the Guaranteed
Interest Account is determined based on a comparison of the quarterly
guaranteed interest rates to the interest rate being offered in the
current quarter. Shares of mutual funds are valued at quoted market
prices which represent the net asset value of shares held by the Plan
at year-end. Shares of J.B. Hunt Transport Services, Inc. common
stock are valued at quoted market prices. Guaranteed investment
contracts with insurance companies are stated at the contract values
as reported to the Plan by the insurance companies, which approximates
fair value. Net appreciation in fair value of investments represents
increases or decreases in value resulting from realized and unrealized
gains and losses. Participant notes receivable are carried at the
unpaid principal balance which approximates fair value. The cost of
securities sold is determined by the weighted average cost method.
(c) PAYMENT OF BENEFITS
Benefits are recorded when paid. Defaults on participant notes
receivable are recorded as benefits paid.
(d) USE OF ESTIMATES
Management of the Plan has made and used estimates and assumptions
relating to the reporting of assets and liabilities and additions and
deductions to prepare these financial statements in conformity with
generally accepted accounting principles. Actual results could differ
from those estimates.
(e) RECLASSIFICATIONS
Certain reclassifications have been made to the 1996 financial
statements to conform to the current year's presentation. Such
reclassifications had no effect on the 1996 increase in net assets
available for benefits.
(Continued)
8
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
(3) INVESTMENTS
The following table presents the fair value of investments. Investments
representing 5% or more of the Plan's net assets are separately identified:
<TABLE>
DECEMBER 31
----------------------------------------------------------
1997 1996
---------------------------- -------------------------
NUMBER OF NUMBER OF
SHARES OR FAIR SHARES OR FAIR
UNITS VALUE UNITS VALUE
----- ----- ----- -----
<S> <C> <C> <C> <C>
Guaranteed Interest Account 29,564,225 $ 33,110,366 23,887,798 $28,093,347
------------ -----------
Mutual funds:
Longleaf Partners Fund 780,955 20,289,213 677,675 15,484,869
Jennison Growth Fund 878,119 12,039,009 581,227 6,643,428
Active Balanced Fund 548,293 7,160,712 424,875 5,323,680
International Stock Fund 442,983 7,831,933 366,418 6,295,067
Other - 7,755,562 - 3,618,939
---------- ------------ ---------- -----------
---------- ----------
55,076,429 37,365,983
------------ -----------
Common stock - J.B. Hunt
Transport Services, Inc. 386,476 7,246,428 288,566 4,039,927
Participant notes receivable - 9,584,738 - 7,542,885
---------- ------------ ---------- -----------
---------- ----------
Total $105,017,961 $77,042,142
------------ -----------
------------ -----------
</TABLE>
The following represents guaranteed investment contracts which are included in
the financial statements at contract values as reported to the Plan by the
insurance companies:
<TABLE>
DECEMBER 31
----------------------
1997 1996
---- ----
<S> <C> <C>
Lincoln National Life, (Policy #59938), 6.40% $ - 1,636,671
Lincoln National Life, (Policy #59677), 6.40% - 887,888
---- ---------
$ - 2,524,559
---- ---------
---- ---------
</TABLE>
(Continued)
9
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
During 1997 and 1996, the Plan's investments (including investments bought,
sold, and held during the year) appreciated (depreciated) in value as
follows:
<TABLE>
DECEMBER 31
----------------------
1997 1996
---- ----
<S> <C> <C>
Mutual funds $7,992,362 4,695,535
Common stock 1,719,623 (676,935)
---------- ---------
$9,711,985 4,018,600
---------- ---------
---------- ---------
</TABLE>
(4) PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of
Plan termination, participants will become 100 percent vested in their
accounts.
(5) RELATED PARTY TRANSACTIONS
Certain plan investments are shares of mutual funds managed by Jennison,
Mercator, PMF and SAM. Prudential Defined Contribution Services, Inc.
performs recordkeeping responsibilities for the Plan and Prudential Trust
Company is the Plan trustee.
(6) FEDERAL INCOME TAXES
The Internal Revenue Service has determined and informed the Company by
letter dated December 4, 1995 that the Plan and related trust are designed
in accordance with applicable sections of the Internal Revenue Code
("IRC"). The Plan administrator believes that the Plan is currently being
operated in compliance with the applicable requirements of the IRC.
The Plan qualifies as a salary reduction plan under Section 401(k) of the
Internal Revenue Code. Accordingly, employer contributions and allocations
to participants' accounts of investment earnings are not taxable to
participants when made or when credited to the participants' account.
However, participant distributions are subject to ordinary income taxes and
may be subject to an additional 10% penalty tax.
Discrimination tests for Plan year 1997, as described in Treasury
Regulations Section 1.401(m), have been completed subsequent to December
31, 1997. As a result, approximately $103,000 of corrective distributions
are required to be made to maintain the Plan's qualification under Section
401(a) and exemption from Federal income taxes under Section 501(a). The
Plan's administrator intends to make such corrective distributions to
preserve the Plan's tax exempt status.
Discrimination tests for Plan year 1996, as previously described, were
completed subsequent to December 31, 1996. As a result, approximately
$135,000 of corrective distributions were made for the 1996 Plan year in
order to maintain the Plan's qualification under Section 401(a) and
exemption from Federal income taxes under Section 501(a).
(Continued)
10
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
(7) 401(k) FUNDS
Participants have the option to direct their investments into the following
funds. An analysis of net assets available for benefits of each fund as of
December 31, 1997 and 1996 is presented below:
<TABLE>
J.B. HUNT
GUARANTEED COMPANY LONGLEAF ACTIVE INTERNATIONAL MONEY
INTEREST STOCK PARTNERS BALANCED STOCK MART
ACCOUNT FUND FUND FUND FUND ASSETS
------- ---- ---- ---- ---- ------
<S> <C> <C> <C> <C> <C> <C>
December 31, 1997:
Investments:
Guaranteed interest account $33,110,366 - - - - -
Mutual funds - - 20,289,213 7,160,712 7,831,933 2,549,016
Common stock - 7,246,428 - - - -
Participant notes receivable 5,002,884 854,872 1,893,239 564,641 571,760 64,704
----------- --------- ---------- --------- --------- ---------
Total investments 38,113,250 8,101,300 22,182,452 7,725,353 8,403,693 2,613,720
----------- --------- ---------- --------- --------- ---------
Receivables:
Contributions 172,420 37,735 105,655 37,289 40,784 13,274
Accrued investment income 5,168 1,131 3,167 1,118 1,222 398
----------- --------- ---------- --------- --------- ---------
Total receivables 177,588 38,866 108,822 38,407 42,006 13,672
----------- --------- ---------- --------- --------- ---------
Total assets 38,290,838 8,140,166 22,291,274 7,763,760 8,445,699 2,627,392
Corrective distributions
payable to participants 102,706 - - - - -
----------- --------- ---------- --------- --------- ---------
Net assets available
for benefits $38,188,132 8,140,166 22,291,274 7,763,760 8,445,699 2,627,392
----------- --------- ---------- --------- --------- ---------
----------- --------- ---------- --------- --------- ---------
GOVERNMENT JENNISON NEW STOCK
INCOME GROWTH OPPORTUNITIES INDEX
FUND FUND FUND FUND TOTAL
---- ---- ---- ---- -----
December 31, 1997:
Investments:
Guaranteed interest account - - - - 33,110,366
Mutual funds 3,048,345 12,039,009 773,721 1,384,480 55,076,429
Common stock - - - - 7,246,428
Participant notes receivable 107,590 439,996 40,009 45,043 9,584,738
--------- ---------- ------- --------- -----------
Total investments 3,155,935 12,479,005 813,730 1,429,523 105,017,961
--------- ---------- ------- --------- -----------
Receivables:
Contributions 15,874 62,692 4,029 7,211 496,963
Accrued investment income 476 1,879 121 216 14,896
--------- ---------- ------- --------- -----------
Total receivables 16,350 64,571 4,150 7,427 511,859
--------- ---------- ------- --------- -----------
Total assets 3,172,285 12,543,576 817,880 1,436,950 105,529,820
Corrective distributions
payable to participants - - - - 102,706
--------- ---------- ------- --------- -----------
Net assets available
for benefits 3,172,285 12,543,576 817,880 1,436,950 105,427,114
--------- ---------- ------- --------- -----------
--------- ---------- ------- --------- -----------
(Continued)
</TABLE>
11
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
<TABLE>
J.B. HUNT
GUARANTEED TRANSFER COMPANY LONGLEAF ACTIVE
INTEREST GUARANTEED STOCK PARTNERS BALANCED
ACCOUNT FUND FUND FUND FUND
------- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
December 31, 1996:
Investments:
Guaranteed interest account $28,093,347 - - - -
Mutual funds - - - 15,484,869 5,323,680
Common stock - - 4,039,927 - -
Guaranteed investment contracts - 2,524,559 - - -
Participant notes receivable 2,657,256 1,603,055 674,755 1,576,390 412,247
----------- --------- --------- ---------- ---------
Total investments 30,750,603 4,127,614 4,714,682 17,061,259 5,735,927
----------- --------- --------- ---------- ---------
Receivables:
Contributions 142,592 12,813 20,505 78,596 27,021
Accrued investment income 3,090 278 444 1,704 586
----------- --------- --------- ---------- ---------
Total receivables 145,682 13,091 20,949 80,300 27,607
----------- --------- --------- ---------- ---------
Total assets 30,896,285 4,140,705 4,735,631 17,141,559 5,763,534
Corrective distributions
payable to participants 134,777 - - - -
----------- --------- --------- ---------- ---------
Net assets available
for benefits $30,761,508 4,140,705 4,735,631 17,141,559 5,763,534
----------- --------- --------- ---------- ---------
----------- --------- --------- ---------- ---------
INTERNATIONAL MONEY GOVERNMENT JENNISON
STOCK MART INCOME GROWTH
FUND ASSETS FUND FUND TOTAL
---- ------ ---- ---- -----
December 31, 1996:
Investments:
Guaranteed interest account - - - - 28,093,347
Mutual funds 6,295,067 1,658,102 1,960,837 6,643,428 37,365,983
Common stock - - - - 4,039,927
Guaranteed investment contracts - - - - 2,524,559
Participant notes receivable 401,464 9,193 35,393 173,132 7,542,885
--------- --------- --------- --------- ----------
Total investments 6,696,531 1,667,295 1,996,230 6,816,560 79,566,701
--------- --------- --------- --------- ----------
Receivables:
Contributions 31,952 8,415 9,953 33,721 365,568
Accrued investment income 693 182 216 732 7,925
--------- --------- --------- --------- ----------
Total receivables 32,645 8,597 10,169 34,453 373,493
--------- --------- --------- --------- ----------
Total assets 6,729,176 1,675,892 2,006,399 6,851,013 79,940,194
Corrective distributions
payable to participants - - - - 134,777
--------- --------- --------- --------- ----------
Net assets available
for benefits 6,729,176 1,675,892 2,006,399 6,851,013 79,805,417
--------- --------- --------- --------- ----------
--------- --------- --------- --------- ----------
(Continued)
</TABLE>
12
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
An analysis of changes in net assets available for benefits for each fund for
the years ended December 31, 1997 and 1996 is presented below:
<TABLE>
J.B. HUNT
GUARANTEED TRANSFER COMPANY LONGLEAF ACTIVE INTERNATIONAL
INTEREST GUARANTEED STOCK PARTNERS BALANCED STOCK
ACCOUNT FUND FUND FUND FUND FUND
------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Year ended December 31, 1997:
Additions to net assets
attributed to:
Investment income:
Net appreciation in fair
value of investments $ - 91,106 1,719,623 4,235,815 732,321 300,237
Interest and dividends 2,217,133 - 115,016 253,216 223,559 197,089
----------- ---------- --------- ---------- --------- ---------
2,217,133 91,106 1,834,639 4,489,031 955,880 497,326
----------- ---------- --------- ---------- --------- ---------
Contributions:
Employer 1,813,887 4,093 471,664 835,455 593,962 739,194
Participants 4,496,814 - 1,194,599 2,083,813 1,343,143 1,942,971
----------- ---------- --------- ---------- --------- ---------
6,310,701 4,093 1,666,263 2,919,268 1,937,105 2,682,165
----------- ---------- --------- ---------- --------- ---------
Total additions 8,527,834 95,199 3,500,902 7,408,299 2,892,985 3,179,491
----------- ---------- --------- ---------- --------- ---------
Deductions from net assets
attributed to:
Benefits paid to
participants 2,718,044 276,314 369,744 1,127,546 440,360 543,393
Administrative expenses 49,278 341 621 868 3,328 1,816
Transfers to other Plans 951,755 25,690 170,401 922,970 297,762 307,099
----------- ---------- --------- ---------- --------- ---------
Total deductions 3,719,077 302,345 540,766 2,051,384 741,450 852,308
----------- ---------- --------- ---------- --------- ---------
Transfers 2,617,867 (3,933,559) 444,399 (207,200) (151,309) (610,660)
----------- ---------- --------- ---------- --------- ---------
Increase (decrease) in net assets
available for benefits 7,426,624 (4,140,705) 3,404,535 5,149,715 2,000,226 1,716,523
Net assets available for benefits
at beginning of year 30,761,508 4,140,705 4,735,631 17,141,559 5,763,534 6,729,176
----------- ---------- --------- ---------- --------- ---------
Net assets available for benefits
at end of year $38,188,132 - 8,140,166 22,291,274 7,763,760 8,445,699
----------- ---------- --------- ---------- --------- ---------
----------- ---------- --------- ---------- --------- ---------
MONEY GOVERNMENT JENNISON NEW STOCK
MART INCOME GROWTH OPPORTUNITIES INDEX
ASSETS FUND FUND FUND FUND TOTAL
------ ---- ---- ---- ---- -----
Year ended December 31, 1997:
Additions to net assets
attributed to:
Investment income:
Net appreciation in fair
value of investments - 72,796 2,364,130 80,480 115,477 9,711,985
Interest and dividends 142,222 204,455 105,217 4,366 18,242 3,480,515
--------- --------- ---------- ------- --------- -----------
142,222 277,251 2,469,347 84,846 133,719 13,192,500
--------- --------- ---------- ------- --------- -----------
Contributions:
Employer 308,501 344,575 1,012,599 140,235 180,241 6,444,406
Participants 808,973 890,512 2,652,921 273,564 350,756 16,038,066
--------- --------- ---------- ------- --------- -----------
1,117,474 1,235,087 3,665,520 413,799 530,997 22,482,472
--------- --------- ---------- ------- --------- -----------
Total additions 1,259,696 1,512,338 6,134,867 498,645 664,716 35,674,972
--------- --------- ---------- ------- --------- -----------
Deductions from net assets
attributed to:
Benefits paid to
participants 197,704 185,208 720,986 15,278 23,192 6,617,769
Administrative expenses 2,832 2,232 5,877 55 1,132 68,380
Transfers to other Plans 143,112 78,710 399,600 1,532 68,495 3,367,126
--------- --------- ---------- ------- --------- -----------
Total deductions 343,648 266,150 1,126,463 16,865 92,819 10,053,275
--------- --------- ---------- ------- --------- -----------
Transfers 35,452 (80,302) 684,159 336,100 865,053 -
--------- --------- ---------- ------- --------- -----------
Increase (decrease) in net assets
available for benefits 951,500 1,165,886 5,692,563 817,880 1,436,950 25,621,697
Net assets available for benefits
at beginning of year 1,675,892 2,006,399 6,851,013 - - 79,805,417
--------- --------- ---------- ------- --------- -----------
Net assets available for benefits
at end of year 2,627,392 3,172,285 12,543,576 817,880 1,436,950 105,427,114
--------- --------- ---------- ------- --------- -----------
--------- --------- ---------- ------- --------- -----------
(Continued)
</TABLE>
13
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1997 and 1996
<TABLE>
J.B. HUNT
GUARANTEED TRANSFER COMPANY LONGLEAF ACTIVE INTERNATIONAL
INTEREST GUARANTEED STOCK PARTNERS BALANCED STOCK
ACCOUNT FUND FUND FUND FUND FUND
------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Year ended December 31, 1996:
Additions to net assets
attributed to:
Investment income:
Net appreciation
(depreciation) in fair
value of investments $ - 260,766 (676,935) 2,487,602 370,610 766,734
Interest and dividends 1,778,558 45,823 79,031 318,903 194,834 168,890
----------- ---------- --------- ---------- --------- ---------
1,778,558 306,589 (597,904) 2,806,505 565,444 935,624
----------- ---------- --------- ---------- --------- ---------
Contributions:
Employer 1,164,568 (5,740) 220,560 340,497 267,195 379,765
Participants 4,370,573 16,249 975,845 1,825,625 1,281,276 1,757,985
----------- ---------- --------- ---------- --------- ---------
5,535,141 10,509 1,196,405 2,166,122 1,548,471 2,137,750
----------- ---------- --------- ---------- --------- ---------
Total additions 7,313,699 317,098 598,501 4,972,627 2,113,915 3,073,374
----------- ---------- --------- ---------- --------- ---------
Deductions from net assets
attributed to:
Benefits paid to
participants 2,066,700 592,309 276,655 1,215,193 336,024 458,901
Administrative expenses (27,888) 2,258 14,577 19,757 10,691 10,079
Transfers to other Plans 1,497,461 468,234 96,748 907,107 305,097 325,140
----------- ---------- --------- ---------- --------- ---------
Total deductions 3,536,273 1,062,801 387,980 2,142,057 651,812 794,120
----------- ---------- --------- ---------- --------- ---------
Transfers 4,463,428 (4,788,006) 532,148 (113,473) (262,572) (41,717)
----------- ---------- --------- ---------- --------- ---------
Increase (decrease) in net assets
available for benefits 8,240,854 (5,533,709) 742,669 2,717,097 1,199,531 2,237,537
Net assets available for benefits
at beginning of year 22,520,654 9,674,414 3,992,962 14,424,462 4,564,003 4,491,639
----------- ---------- --------- ---------- --------- ---------
Net assets available for benefits
at end of year $30,761,508 4,140,705 4,735,631 17,141,559 5,763,534 6,729,176
----------- ---------- --------- ---------- --------- ---------
----------- ---------- --------- ---------- --------- ---------
MONEY GOVERNMENT JENNISON GROWTH MONEY
MART INCOME GROWTH STOCK INCOME MARKET
ASSETS FUND FUND FUND FUND FUND TOTAL
------ ---- ---- ---- ---- ---- -----
Year ended December 31, 1996:
Additions to net assets
attributed to:
Investment income:
Net appreciation
(depreciation) in fair
value of investments - 34,470 278,229 497,124 - - 4,018,600
Interest and dividends 29,951 45,394 25,242 57,294 18,378 66,941 2,829,239
--------- --------- --------- ---------- ---------- ---------- ----------
29,951 79,864 303,471 554,418 18,378 66,941 6,847,839
--------- --------- --------- ---------- ---------- ---------- ----------
Contributions:
Employer 45,197 49,317 134,256 340,245 149,169 124,807 3,209,836
Participants 206,392 228,305 686,631 1,605,974 634,888 544,943 14,134,686
--------- --------- --------- ---------- ---------- ---------- ----------
251,589 277,622 820,887 1,946,219 784,057 669,750 17,344,522
--------- --------- --------- ---------- ---------- ---------- ----------
Total additions 281,540 357,486 1,124,358 2,500,637 802,435 736,691 24,192,361
--------- --------- --------- ---------- ---------- ---------- ----------
Deductions from net assets
attributed to:
Benefits paid to
participants 42,627 50,196 103,672 242,344 89,693 93,942 5,568,256
Administrative expenses 3,033 3,207 7,676 6,795 2,762 4,515 57,462
Transfers to other Plans 40,266 67,607 101,429 121,167 45,264 35,516 4,011,036
--------- --------- --------- ---------- ---------- ---------- ----------
Total deductions 85,926 121,010 212,777 370,306 137,719 133,973 9,636,754
--------- --------- --------- ---------- ---------- ---------- ----------
Transfers 1,480,278 1,769,923 5,939,432 (5,468,812) (1,966,006) (1,544,623) -
--------- --------- --------- ---------- ---------- ---------- ----------
Increase (decrease) in net assets
available for benefits 1,675,892 2,006,399 6,851,013 (3,338,481) (1,301,290) (941,905) 14,555,607
Net assets available for benefits
at beginning of year - - - 3,338,481 1,301,290 941,905 65,249,810
--------- --------- --------- ---------- ---------- ---------- ----------
Net assets available for benefits
at end of year 1,675,892 2,006,399 6,851,013 - - - 79,805,417
--------- --------- --------- ---------- ---------- ---------- ----------
--------- --------- --------- ---------- ---------- ---------- ----------
</TABLE>
14
<PAGE>
SCHEDULE 1
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Item 27(a) - Schedule of Assets Held for Investment Purposes
December 31, 1997
<TABLE>
UNITS
OR NUMBER CURRENT
ISSUER OR BORROWER DESCRIPTION OF SHARES COST VALUE
------------------ ----------- --------- ---- -----
<S> <C> <C> <C> <C>
*The Prudential Insurance Company Guaranteed Interest Account - $33,110,366 33,110,366
of America
---------
---------
Mutual funds:
Southeastern Asset Management Fund Longleaf Partners Fund 780,955 16,786,360 20,289,213
Putnam Investment Management, Inc. Putnam New Opportunities Fund 15,903 724,849 773,721
*Prudential Management Fund, Inc. Stock Index Fund 63,362 1,310,514 1,384,480
Jennison Growth Fund 878,119 10,787,986 12,039,009
Active Balanced Fund 548,293 6,768,256 7,160,712
International Stock Fund 442,983 7,298,072 7,831,933
Money Mart Assets 2,548,997 2,549,016 2,549,016
Government Income Fund 337,206 2,956,763 3,048,345
---------
---------
*J.B. Hunt Transport Services, Inc. Common stock - J.B. Hunt Transport
Services, Inc. 386,476 6,241,320 7,246,428
---------
---------
Participant notes receivable,
9.25% - 10.00% - 9,584,738 9,584,738
--------- ----------- -----------
---------
$98,118,240 105,017,961
----------- -----------
----------- -----------
*Parties-in-interest
</TABLE>
See accompanying independent auditors' report.
15
<PAGE>
SCHEDULE 2
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Item 27(d) - Schedule of Reportable Transactions
Year ended December 31, 1997
<TABLE>
EXPENSES CURRENT
INCURRED VALUE ON
PURCHASE SELLING LEASE WITH TRANSACTION NET
DESCRIPTION PRICE PRICE RENTAL TRANSACTION COST DATE GAIN
----------- ----- ----- ------ ----------- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
*Guaranteed Interest Account:
Purchases $15,227,503 - - - 15,227,503 15,227,503 -
Sales - 10,210,484 - - 10,210,484 10,210,484 -
Mutual Funds:
*Jennison Growth Fund:
Purchases 7,272,358 - - - 7,272,358 7,272,358 -
Sales - 3,224,225 - - 2,870,075 3,224,225 354,150
*Longleaf Partners Fund:
Purchases 7,458,481 - - - 7,458,481 7,458,481 -
Sales - 4,679,518 - - 3,834,383 4,679,518 845,135
*Parties-in-interest
</TABLE>
See accompanying independent auditors' report.
16
<PAGE>
Exhibit 23
The Board of Directors
J.B. Hunt Transport Services, Inc.:
We consent to incorporation by reference in the Registration Statement (No.
33-57127) on Form S-8 of J.B. Hunt Transport Services, Inc. of our report
dated April 17, 1998, relating to the statements of net assets available for
benefits of J.B. Hunt Transport Services, Inc. Employee Retirement Plan as of
December 31, 1997 and 1996, and the related statements of changes in net
assets available for benefits for the years then ended and related
supplemental schedules, which report appears in the December 31, 1997, annual
report on Form 11-K of J.B. Hunt Transport Services, Inc. Employee Retirement
Plan.
KPMG Peat Marwick LLP
Little Rock, Arkansas
June 30, 1998
