<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, 1998
( ) 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, 1998, and 1997
Statements of Changes in Net Assets Available for Benefits, Years Ended December
31, 1998, and 1997
Notes to Financial Statements, December 31, 1998, and 1997
Item 27(a) - Schedule of Assets Held for Investment Purposes, December 31, 1998
Item 27(d) - Schedule of Reportable Transactions, Year Ended December 31, 1998
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: June 28,1999 BY: /s/ Jerry W. Walton
------------ ---------------------------------------------
Jerry W. Walton
Executive Vice President Finance & Administration
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, 1998 and 1997
(With Independent Auditors' Report Thereon)
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Independent Auditors' Report 1
Statements of Net Assets Available for Benefits - December 31, 1998 and 1997 2
Statements of Changes in Net Assets Available for Benefits - Years ended
December 31, 1998 and 1997 3
Notes to Financial Statements 4
Item 27(a) - Schedule of Assets Held for Investment Purposes - December 31, 1998 19
Item 27(d) - Schedule of Reportable Transactions - Year ended December 31, 1998 20
</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, 1998 and 1997, 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, 1998 and
1997, 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 LLP
Little Rock, Arkansas
May 21, 1999
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Statements of Net Assets Available for Benefits
December 31, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
(NOTE 8) (NOTE 8)
------------ ------------
<S> <C> <C>
ASSETS
Investments, at fair value (note 3):
Guaranteed interest account $ 36,565,975 33,110,366
Mutual funds 76,354,388 55,076,429
Common stock - J.B. Hunt Transport Services, Inc. 18,838,511 7,246,428
Participant notes receivable 11,658,474 9,584,738
------------ ------------
Total investments 143,417,348 105,017,961
------------ ------------
Receivables:
Contributions:
Employer 81,115 123,105
Employee 328,123 373,858
Accrued investment income 11,845 14,896
------------ ------------
Total receivables 421,083 511,859
------------ ------------
Total assets 143,838,431 105,529,820
LIABILITIES
Corrective distributions payable to participants (note 6) 57,762 102,706
------------ ------------
Net assets available for benefits $143,780,669 105,427,114
------------ ------------
------------ ------------
</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, 1998 and 1997
<TABLE>
<CAPTION>
1998 1997
(NOTE 8) (NOTE 8)
------------ ------------
<S> <C> <C>
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value of investments (note 3) $ 14,381,776 9,711,985
Interest and dividends 3,877,051 3,480,515
------------ ------------
18,258,827 13,192,500
------------ ------------
Contributions:
Employer 6,524,058 4,891,310
Participants 25,450,584 16,038,066
Transfers from other plans 2,453,402 1,553,096
------------ ------------
34,428,044 22,482,472
------------ ------------
Total additions 52,686,871 35,674,972
------------ ------------
Deductions from net assets attributed to:
Benefits paid to participants 6,723,879 6,617,769
Administrative expenses 46,005 68,380
Transfers to other plans 7,563,432 3,367,126
------------ ------------
Total deductions 14,333,316 10,053,275
------------ ------------
Increase in net assets available for benefits 38,353,555 25,621,697
Net assets available for benefits:
Beginning of year 105,427,114 79,805,417
------------ ------------
End of year $143,780,669 105,427,114
------------ ------------
------------ ------------
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(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 were
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, 1998, the Plan
had 11,269 participants, of which 8,840 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). Employer matching contributions are as follows:
<TABLE>
<CAPTION>
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 1998 or 1997.
(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, 1998 and 1997 amounted to approximately $95,000
and $389,000, respectively.
(Continued)
4
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(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 1998 ranged from 5% to 5.85%.
- 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.
b. Prudential 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. Prudential 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.
(Continued)
5
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
d. Prudential 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. Prudential 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. Prudential 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. Putnam 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. Prudential Stock Index Fund - Prudential
Diversified Investment Strategies ("PDIS")
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.
(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, (8.75% at
December 31, 1998). Principal and interest is paid ratably
through monthly payroll deductions.
(g) TRANSFERS TO OTHER PLANS
During the years ended December 31, 1998 and 1997,
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.
(Continued)
6
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(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, 1998 and 1997, approximately $16,959,000 and
$5,826,000, 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) PRIOR YEAR RECLASSIFICATIONS
Certain 1997 amounts have been reclassified to conform to 1998
presentation. These prior year classifications had no effect
on 1997 changes in net assets available for benefits.
(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, 1998 and 1997. 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 Company common stock are valued at quoted
market prices. 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
(Continued)
7
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
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.
(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>
<CAPTION>
DECEMBER 31
-----------------------------------------------------------------------------
1998 1997
-------------------------------- ----------------------------------
NUMBER OF NUMBER OF
SHARES OR FAIR SHARES OR FAIR
UNITS VALUE UNITS VALUE
---------- ------------ ---------- -------------
<S> <C> <C> <C> <C>
Guaranteed Interest Account 36,565,975 $ 36,565,975 33,110,366 $ 33,110,366
---------- ------------ ---------- -------------
---------- ----------
Mutual funds:
Longleaf Partners Fund 901,371 21,984,430 780,955 20,289,213
Jennison Growth Fund 1,094,320 20,047,936 878,119 12,039,009
Active Balanced Fund 729,524 9,461,930 548,293 7,160,712
International Stock Fund 449,464 8,737,583 442,983 7,831,933
Other - 16,122,509 - 7,755,562
---------- ------------ ---------- -------------
---------- ----------
76,354,388 55,076,429
------------ -------------
Common stock - J.B. Hunt
Transport Services, Inc. 819,065 18,838,511 386,476 7,246,428
Participant notes receivable - 11,658,474 - 9,584,738
---------- ------------ ---------- -------------
---------- ----------
Total $143,417,348 $105,017,961
------------ -------------
------------ -------------
</TABLE>
During 1998 and 1997, the Plan's investments (including investments
bought, sold, and held during the year) appreciated in value as
follows:
<TABLE>
<CAPTION>
DECEMBER 31
--------------------------------
1998 1997
----------- ---------
<S> <C> <C>
Mutual funds $10,597,134 7,992,362
Common stock 3,784,642 1,719,623
----------- ---------
$14,381,776 9,711,985
----------- ---------
----------- ---------
</TABLE>
(4) PLAN TERMINATION
(Continued)
8
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
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
The Plan's guaranteed interest account is issued by Prudential.
Additionally, certain plan investments are shares of mutual funds
managed by Prudential affiliates, PMF and PDIS. 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'
accounts. However, participant distributions are subject to ordinary
income taxes and may be subject to an additional 10% penalty tax.
Discrimination tests for Plan year 1998, as described in Treasury
Regulations Section 1.401(m), have been completed subsequent to
December 31, 1998. As a result, approximately $58,000 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 1997, as previously described, were
completed subsequent to December 31, 1997. As a result, approximately
$103,000 of corrective distributions were made to maintain the Plan's
qualification under Section 401(a) and exemption from Federal income
taxes under Section 501(a).
(Continued)
9
<PAGE>
(7) YEAR 2000 (UNAUDITED)
The Plan could be adversely affected if the computer systems and those
of service providers used by the Plan or the Company do not properly
process and calculate date related information from and after January
1, 2000. This is commonly known as the "Year 2000 Problem." The Company
is taking steps that it believes are reasonably designed to address the
Year 2000 Problem with respect to the computer systems that it uses and
to obtain satisfactory assurances that comparable steps are being taken
by each of the Plan's other major service providers.
(Continued)
10
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
(8) 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, 1998 and 1997 is presented below:
<TABLE>
<CAPTION>
J.B. HUNT
GUARANTEED COMPANY LONGLEAF ACTIVE
INTEREST STOCK PARTNERS BALANCED
ACCOUNT FUND FUND FUND
------------ ----------- ---------- ----------
<S> <C> <C> <C> <C>
December 31, 1998:
Investments:
Guaranteed interest account $ 36,565,975 -- -- --
Mutual funds -- -- 21,984,430 9,461,930
Common stock - J.B. Hunt
Transport Services, Inc. -- 18,838,511 -- --
Participant notes receivable 5,459,625 1,143,073 2,228,162 742,611
------------ ----------- ---------- ----------
Total investments 42,025,600 19,981,584 24,212,592 10,204,541
------------ ----------- ---------- ----------
Receivables:
Contributions 113,572 58,511 68,282 29,389
Accrued investment income 3,287 1,694 1,976 851
------------ ----------- ---------- ----------
Total receivables 116,859 60,205 70,258 30,240
------------ ----------- ---------- ----------
Total assets 42,142,459 20,041,789 24,282,850 10,234,781
Corrective distributions payable to
participants (57,762) -- -- --
------------ ----------- ---------- ----------
Net assets available for benefits $ 42,084,697 20,041,789 24,282,850 10,234,781
------------ ----------- ---------- ----------
------------ ----------- ---------- ----------
</TABLE>
(Continued)
11
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
<TABLE>
<CAPTION>
INTERNATIONAL MONEY GOVERNMENT JENNISON NEW STOCK
STOCK MART INCOME GROWTH OPPORTUNITIES INDEX
FUND ASSETS FUND FUND FUND FUND TOTAL
------------- --------- --------- ---------- ------------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
December 31, 1998:
Investments:
Guaranteed interest account -- -- -- -- -- -- 36,565,975
Mutual funds 8,737,583 3,782,455 4,429,426 20,047,936 3,123,149 4,787,479 76,354,388
Common stock - J.B. Hunt
Transport Services, Inc. -- -- -- -- -- -- 18,838,511
Participant notes receivable 637,080 132,070 209,590 674,432 169,871 261,960 11,658,474
------------- --------- --------- ---------- ------------- ---------- -----------
Total investments 9,374,663 3,914,525 4,639,016 20,722,368 3,293,020 5,049,439 143,417,348
------------- --------- --------- ---------- ------------- ---------- -----------
Receivables:
Contributions 27,138 11,749 13,758 62,267 9,699 14,873 409,238
Accrued investment income 786 340 398 1,802 281 430 11,845
------------- --------- --------- ---------- ------------- ---------- -----------
Total receivables 27,924 12,089 14,156 64,069 9,980 15,303 421,083
------------- --------- --------- ---------- ------------- ---------- -----------
9,402,587 3,926,614 4,653,172 20,786,437 3,303,000 5,064,742 143,838,431
Total assets
Corrective distributions payable to
participants -- -- -- -- -- -- (57,762)
------------- --------- --------- ---------- ------------- ---------- -----------
Net assets available for benefits 9,402,587 3,926,614 4,653,172 20,786,437 3,303,000 5,064,742 143,780,669
------------- --------- --------- ---------- ------------- ---------- -----------
------------- --------- --------- ---------- ------------- ---------- -----------
</TABLE>
(Continued)
12
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
<TABLE>
<CAPTION>
J.B. HUNT
GUARANTEED COMPANY LONGLEAF ACTIVE
INTEREST STOCK PARTNERS BALANCED
ACCOUNT FUND FUND FUND
----------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
December 31, 1997:
Investments:
Guaranteed interest account $33,110,366 -- -- --
Mutual funds -- -- 20,289,213 7,160,712
Common stock -- 7,246,428 -- --
Participant notes receivable 5,002,884 854,872 1,893,239 564,641
----------- ---------- ---------- ----------
Total investments 38,113,250 8,101,300 22,182,452 7,725,353
----------- ---------- ---------- ----------
Receivables:
Contributions 172,420 37,735 105,655 37,289
Accrued investment income 5,168 1,131 3,167 1,118
----------- ---------- ---------- ----------
Total receivables 177,588 38,866 108,822 38,407
----------- ---------- ---------- ----------
Total assets 38,290,838 8,140,166 22,291,274 7,763,760
Corrective distributions payable to
participants 102,706 -- -- --
----------- ---------- ---------- ----------
Net assets available for benefits $38,188,132 8,140,166 22,291,274 7,763,760
----------- ---------- ---------- ----------
----------- ---------- ---------- ----------
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL MONEY GOVERNMENT JENNISON NEW STOCK
STOCK MART INCOME GROWTH OPPORTUNITIES INDEX
FUND ASSETS FUND FUND FUND FUND TOTAL
------------- --------- ---------- ---------- ------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
December 31, 1997:
Investments:
Guaranteed interest account -- -- -- -- -- -- 33,110,366
Mutual funds 7,831,933 2,549,016 3,048,345 12,039,009 773,721 1,384,480 55,076,429
Common stock -- -- -- -- -- -- 7,246,428
Participant notes receivable 571,760 64,704 107,590 439,996 40,009 45,043 9,584,738
------------- --------- ---------- ---------- ------------- --------- -----------
Total investments 8,403,693 2,613,720 3,155,935 12,479,005 813,730 1,429,523 105,017,961
------------- --------- ---------- ---------- ------------- --------- -----------
Receivables:
Contributions 40,784 13,274 15,874 62,692 4,029 7,211 496,963
Accrued investment income 1,222 398 476 1,879 121 216 14,896
------------- --------- ---------- ---------- ------------- --------- -----------
Total receivables 42,006 13,672 16,350 64,571 4,150 7,427 511,859
------------- --------- ---------- ---------- ------------- --------- -----------
Total assets 8,445,699 2,627,392 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 8,445,699 2,627,392 3,172,285 12,543,576 817,880 1,436,950 105,427,114
------------- --------- ---------- ---------- ------------- --------- -----------
------------- --------- ---------- ---------- ------------- --------- -----------
</TABLE>
(Continued)
14
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
An analysis of changes in net assets available for benefits for each fund for
the years ended December 31, 1998 and 1997 is presented below:
<TABLE>
<CAPTION>
J.B. HUNT
GUARANTEED COMPANY LONGLEAF ACTIVE
INTEREST STOCK PARTNERS BALANCED
ACCOUNT FUND FUND FUND
------------ ---------- --------- ----------
<S> <C> <C> <C> <C>
Year ended December 31, 1998:
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value
of investments $ -- 3,784,642 2,535,299 1,024,667
Interest and dividends 2,385,115 186,912 129,158 268,974
------------ ----------- ----------- ----------
2,385,115 3,971,554 2,664,457 1,293,641
------------ ----------- ----------- ----------
Contributions:
Employer 1,867,045 682,789 702,672 471,440
Participants 5,649,473 3,099,394 3,138,968 1,840,296
Transfers from other plans 623,635 189,934 232,933 160,489
------------ ----------- ----------- ----------
8,140,153 3,972,117 4,074,573 2,472,225
------------ ----------- ----------- ----------
Total additions 10,525,268 7,943,671 6,739,030 3,765,866
------------ ----------- ----------- ----------
Deductions from net assets attributed to:
Benefits paid to participants 2,542,710 544,964 1,024,100 402,045
Administrative expenses 28,407 900 805 3,885
Transfers to other plans 2,432,491 239,260 1,598,339 473,958
------------ ----------- ----------- ----------
Total deductions 5,003,608 785,124 2,623,244 879,888
------------ ----------- ----------- ----------
Transfers (1,625,095) 4,743,076 (2,124,210) (414,957)
------------ ----------- ----------- ----------
Increase in net assets available
for benefits 3,896,565 11,901,623 1,991,576 2,471,021
Net assets available for benefits
at beginning of year 38,188,132 8,140,166 22,291,274 7,763,760
------------ ----------- ----------- ----------
Net assets available for benefits
at end of year $ 42,084,697 20,041,789 24,282,850 10,234,781
------------ ----------- ----------- ----------
------------ ----------- ----------- ----------
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL MONEY GOVERNMENT JENNISON NEW STOCK
STOCK MART INCOME GROWTH OPPORTUNITIES INDEX
FUND ASSETS FUND FUND FUND FUND TOTAL
------------- --------- ----------- ---------- ------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Year ended December 31, 1998:
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value
of investments 743,375 -- 85,396 5,060,562 418,427 729,408 14,381,776
Interest and dividends 203,085 201,604 273,566 144,582 17,418 66,637 3,877,051
------------- --------- ----------- ---------- ------------- --------- -----------
946,460 201,604 358,962 5,205,144 435,845 796,045 18,258,827
------------- --------- ----------- ---------- ------------- --------- -----------
Contributions:
Employer 544,155 279,545 304,294 991,862 269,324 410,932 6,524,058
Participants 2,073,772 1,079,667 1,153,952 4,025,028 1,410,741 1,979,293 25,450,584
Transfers from other plans 78,358 82,876 50,741 425,312 337,890 271,234 2,453,402
------------- --------- ----------- ---------- ------------- --------- -----------
2,696,285 1,442,088 1,508,987 5,442,202 2,017,955 2,661,459 34,428,044
------------- --------- ----------- ---------- ------------- --------- -----------
Total additions 3,642,745 1,643,692 1,867,949 10,647,346 2,453,800 3,457,504 52,686,871
------------- --------- ----------- ---------- ------------- --------- -----------
Deductions from net assets attributed to:
Benefits paid to participants 487,727 247,559 291,687 838,111 133,491 211,485 6,723,879
Administrative expenses 687 2,153 1,953 3,071 124 4,020 46,005
Transfers to other plans 627,959 351,224 483,457 1,051,969 122,635 182,140 7,563,432
------------- --------- ----------- ---------- ------------- --------- -----------
Total deductions 1,116,373 600,936 777,097 1,893,151 256,250 397,645 14,333,316
------------- --------- ----------- ---------- ------------- --------- -----------
Transfers (1,569,484) 256,466 390,035 (511,334) 287,570 567,933 --
------------- --------- ----------- ---------- ------------- --------- -----------
Increase in net assets available
for benefits 956,888 1,299,222 1,480,887 8,242,861 2,485,120 3,627,792 38,353,555
Net assets available for benefits
at beginning of year 8,445,699 2,627,392 3,172,285 12,543,576 817,880 1,436,950 105,427,114
------------- --------- ----------- ---------- ------------- --------- -----------
Net assets available for benefits
at end of year 9,402,587 3,926,614 4,653,172 20,786,437 3,303,000 5,064,742 143,780,669
------------- --------- ----------- ---------- ------------- --------- -----------
------------- --------- ----------- ---------- ------------- --------- -----------
</TABLE>
(Continued)
16
<PAGE>
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Notes to Financial Statements
December 31, 1998 and 1997
<TABLE>
<CAPTION>
J.B. HUNT
GUARANTEED TRANSFER COMPANY LONGLEAF ACTIVE
INTEREST GUARANTEED STOCK PARTNERS BALANCED
ACCOUNT FUND FUND FUND FUND
----------- ----------- ----------- --------- ----------
<S> <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
Interest and dividends 2,217,133 -- 115,016 253,216 223,559
----------- ----------- ----------- --------- ----------
2,217,133 91,106 1,834,639 4,489,031 955,880
----------- ----------- ----------- --------- ----------
Contributions:
Employer 1,382,972 4,093 399,867 591,816 405,935
Participants 4,496,814 -- 1,194,599 2,083,813 1,343,143
Transfers from other plans 430,915 -- 71,797 243,639 188,027
----------- ----------- ----------- --------- ----------
6,310,701 4,093 1,666,263 2,919,268 1,937,105
----------- ----------- ----------- --------- ----------
Total additions 8,527,834 95,199 3,500,902 7,408,299 2,892,985
----------- ----------- ----------- --------- ----------
Deductions from net assets attributed to:
Benefits paid to participants 2,718,044 276,314 369,744 1,127,546 440,360
Administrative expenses 49,278 341 621 868 3,328
Transfers to other plans 951,755 25,690 170,401 922,970 297,762
----------- ----------- ----------- --------- ----------
Total deductions 3,719,077 302,345 540,766 2,051,384 741,450
----------- ----------- ----------- --------- ----------
Transfers 2,617,867 (3,933,559) 444,399 (207,200) (151,309)
----------- ----------- ----------- --------- ----------
Increase (decrease) in net assets
available for benefits 7,426,624 (4,140,705) 3,404,535 5,149,715 2,000,226
Net assets available for benefits
at beginning of year 30,761,508 4,140,705 4,735,631 17,141,559 5,763,534
----------- ----------- ----------- --------- ----------
Net assets available for benefits
at end of year $38,188,132 -- 8,140,166 22,291,274 7,763,760
----------- ----------- ----------- --------- ----------
----------- ----------- ----------- --------- ----------
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
INTERNATIONAL MONEY GOVERNMENT JENNISON NEW
STOCK MART INCOME GROWTH OPPORTUNITIES
FUND ASSETS FUND FUND FUND
------------- --------- ---------- ---------- -------------
<S> <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 300,237 -- 72,796 2,364,130 80,480
Interest and dividends 197,089 142,222 204,455 105,217 4,366
------------- --------- ---------- ---------- -------------
497,326 142,222 277,251 2,469,347 84,846
------------- --------- ---------- ---------- -------------
Contributions:
Employer 592,928 256,600 286,408 793,789 73,631
Participants 1,942,971 808,973 890,512 2,652,921 273,564
Transfers from other plans 146,266 51,901 58,167 218,810 66,604
------------- --------- ---------- ---------- -------------
2,682,165 1,117,474 1,235,087 3,665,520 413,799
------------- --------- ---------- ---------- -------------
Total additions 3,179,491 1,259,696 1,512,338 6,134,867 498,645
------------- --------- ---------- ---------- -------------
Deductions from net assets attributed to:
Benefits paid to participants 543,393 197,704 185,208 720,986 15,278
Administrative expenses 1,816 2,832 2,232 5,877 55
Transfers to other plans 307,099 143,112 78,710 399,600 1,532
------------- --------- ---------- ---------- -------------
Total deductions 852,308 343,648 266,150 1,126,463 16,865
------------- --------- ---------- ---------- -------------
Transfers (610,660) 35,452 (80,302) 684,159 336,100
------------- --------- ---------- ---------- -------------
Increase (decrease) in net assets
available for benefits 1,716,523 951,500 1,165,886 5,692,563 817,880
Net assets available for benefits
at beginning of year 6,729,176 1,675,892 2,006,399 6,851,013 --
------------- --------- ---------- ---------- -------------
Net assets available for benefits
at end of year 8,445,699 2,627,392 3,172,285 12,543,576 817,880
------------- --------- ---------- ---------- -------------
------------- --------- ---------- ---------- -------------
<CAPTION>
STOCK
INDEX
FUND TOTAL
---------- ------------
<S> <C> <C>
Year ended December 31, 1997:
Additions to net assets attributed to:
Investment income:
Net appreciation in fair value
of investments 115,477 9,711,985
Interest and dividends 18,242 3,480,515
---------- ------------
133,719 13,192,500
---------- ------------
Contributions:
Employer 103,271 4,891,310
Participants 350,756 16,038,066
Transfers from other plans 76,970 1,553,096
---------- ------------
530,997 22,482,472
---------- ------------
Total additions 664,716 35,674,972
---------- ------------
Deductions from net assets attributed to:
Benefits paid to participants 23,192 6,617,769
Administrative expenses 1,132 68,380
Transfers to other plans 68,495 3,367,126
---------- ------------
Total deductions 92,819 10,053,275
---------- ------------
Transfers 865,053 --
---------- ------------
Increase (decrease) in net assets
available for benefits 1,436,950 25,621,697
Net assets available for benefits
at beginning of year -- 79,805,417
---------- ------------
Net assets available for benefits
at end of year 1,436,950 105,427,114
---------- ------------
---------- ------------
</TABLE>
18
<PAGE>
SCHEDULE 1
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Item 27(a) - Schedule of Assets Held for Investment Purposes
December 31, 1998
<TABLE>
<CAPTION>
UNITS
OR NUMBER CURRENT
ISSUER OR BORROWER DESCRIPTION OF SHARES COST VALUE
- ------------------------------ ---------------------------- ---------- ------------ -----------
<S> <C> <C> <C> <C>
* The Prudential Insurance Guaranteed Interest Account 36,565,975 $ 36,565,975 36,565,975
Company of America ----------
----------
Mutual funds:
Longleaf Partners Funds Longleaf Partners Fund 901,371 20,606,250 21,984,430
Putnam Investment Putnam New Opportunities
Management Inc. Fund 53,451 2,755,681 3,123,149
* Prudential Mutual Funds Stock Index Fund 173,585 4,143,583 4,787,479
Jennison Growth Fund 1,094,320 15,040,139 20,047,936
Active Balanced Fund 729,524 9,235,632 9,461,930
International Stock Fund 449,464 7,839,826 8,737,583
Money Mart Assets 3,781,169 3,782,455 3,782,455
Government Income Fund 478,857 4,289,735 4,429,426
----------
----------
* J.B. Hunt Transport Common stock - J.B. Hunt
Services, Inc. Transport Services, Inc. 819,065 15,981,340 18,838,511
Participant notes receivable
8.75% - 10.00% - 11,658,474 11,658,474
---------- ------------ ------------
----------
$131,899,090 143,417,348
------------ -----------
------------ -----------
* Parties-in-interest
</TABLE>
See accompanying independent auditors' report.
19
<PAGE>
SCHEDULE 2
J.B. HUNT TRANSPORT SERVICES, INC.
EMPLOYEE RETIREMENT PLAN
Item 27(d) - Schedule of Reportable Transactions
Year ended December 31, 1998
<TABLE>
<CAPTION>
PURCHASE SELLING
DESCRIPTION PRICE PRICE
- --------------------------------------- ----------- ---------
<S> <C> <C>
* Guaranteed Interest Account:
Purchases $11,990,559 --
Sales -- 8,534,964
Mutual Funds:
* Jennison Growth Fund:
Purchases 10,370,464 --
Sales -- 6,186,016
Longleaf Partners Fund:
Purchases 11,602,710 --
Sales -- 7,788,344
Common stock:
* J.B. Hunt Transport Services, Inc.
Purchases 17,445,214 --
Sales -- 7,708,469
* Parties-in-interest
</TABLE>
See accompanying independent auditors' report.
20
<PAGE>
SCHEDULE 2
<TABLE>
<CAPTION>
EXPENSES CURRENT
INCURRED VALUE ON
LEASE WITH TRANSACTION NET
RENTAL TRANSACTION COST DATE GAIN
------ ----------- ---------- ---------- ------
<S> <C> <C> <C> <C> <C>
* Guaranteed Interest Account: -- -- 11,990,559 11,990,559 --
Purchases -- -- 8,534,964 8,534,964 --
Sales
Mutual Funds:
* Jennison Growth Fund: -- -- 10,370,464 10,370,464 --
Purchases -- -- 6,118,311 6,186,016 67,705
Sales
Longleaf Partners Fund: -- -- 11,602,710 11,602,710 --
Purchases -- -- 7,782,820 7,788,344 5,524
Sales
Common stock:
* J.B. Hunt Transport Services, Inc. -- -- 17,445,214 17,445,214 --
Purchases -- -- 7,705,194 7,708,469 3,275
Sales
* Parties-in-interest
</TABLE>
21
<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
May 21, 1999, relating to the statements of net assets available for benefits of
J.B. Hunt Transport Services, Inc. Employee Retirement Plan as of December 31,
1998 and 1997, 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, 1998, annual report on Form 11-K of J.B. Hunt
Transport Services, Inc. Employee Retirement Plan.
KPMG LLP
Little Rock, Arkansas
June 28, 1999
