J.B. Hunt Transport Services (JBHT) 18 Jan 232022 Q4 Earnings call transcript

Hello and welcome to today's J.B. Hunt Fourth Quarter 2022 Earnings Conference Call. My name is Elliot, and I’ll be your coordinating you call today. [Operator Instructions]

I would now like to hand over to Brad Delco, Senior Vice President of Finance. yours. is floor The ahead. go Please

morning. Good

of Before intends, I some statements. like take intended these such the I call Act identify Litigation of to XXXX. or the to provide similar speakers, Words meaning within time statements forward-looking expects, contain would Private some Securities may Reform anticipates, to as forward-looking introduce statements. the estimates disclosures This are forward-looking regarding expressions

that on based from involve J.B. Hunt's cause and results plans and and uncertainties in those the different are current risks forward-looking expectations to and statements. statements could forth materially activities future These be set

For on please Form information filings refer report other and Hunt's reports and annual and factors, regarding XX-K Securities with to risk the J.B. Commission. Exchange

introduce I'm Hicks, and speakers This Contract President Roberts; and President the call. Services; John of our John CEO, and Field, to joined Intermodal; President our President, Nick President today's morning Services. Brad Shelley our Simpson; of Executive Highway People Darren Kuhlow; Vice CFO, on I’d of Now, COO by Hobbs, like of

to At call to I’d CEO, Mr. some like comments. turn the Roberts, John? this opening John time, for our

Brad, My today we team brief members morning. will be as our leadership specific and here more of you, our areas cover detail. good have to of comments with Thank business

opportunities customers. quality and that through in-turn a service and As shift times opportunities for challenges transit in quarter the XXXX, the that trends we and experienced present our fourth for and seen we both and cyclical on encouraged by from we our upcoming market That present reflect the navigate full-year have of real will providers remain year. dynamics said, we as greater value faster

fourth some inventories. market availability. levels was modest elevated see through of quarter in in the seasonally transportation for and also equipment some service as weak manage labor in loosening customers We Conversely, demand improvements the

of built have nature that our we've As the distinct collective by past, that complementary in are led experience at we Hunt. a I to people and of have officers of market in durable XX XXX in years combined J.B. confidence through be tremendous and our of cycles. the confidence amount discussed here company the our resilient businesses have a

team returns will course stakeholders. the deployed on to capital closing, focused our our charting for of our our disciplined to remain the and on In support long-term growth compound benefit we've

to call our to like President, I'd Now, Shelley? over Shelley turn the Simpson.

many and and on you, last Thank and comments of good shared focus John, today mirror beyond. things will morning. XXXX for priorities quarter I My will the our

priorities If an recall, we three as organization. discussed you

in committed to to and long-term First, disciplined investments remain capacity. our people, technology,

to our for to Second, our long-term organization. our deliver value returns exceptional And entire shareholders. third, deliver across to customers compounding

quarters last focus dynamics, our As changed. an has two our as not shift John organization we have but and discussed, a market in seen we've mentioned, the as

their growing We business are our it and continue We growth. put to believe in transportation who manage for value first that people trust to position customers, us meet long-term service us foremost, in-turn with our our to starts exceptional who for to the delivering and needs. responsible best

We services and years from the customers Hunt the our company believe a cycles. provides J.B. have over many to suite across scroll of trust learned exceptional they value

their on talked and cost, about for exceptional we behalf to is customers which service, transportation challenge for this past, what the deliver value trusted market. Our is and capacity. from customers XXXX In providers, of in value

services as more difficult customers capacity capacity, present can are money intermodal with with pandemic, offering, light highly save our of industry engineered and occurring source. services of our dedicated putting highway one now is to suite weight customers largest America. our value franchise, North service value cost the During Final customers Mile service. or on the in capacity and how leading see Services less to scaled on cost to the where on believe and less We save will We opportunities and the asset money shift a most quality

In some around our but confident any trends, ability demand to with approaching thrive environment. to caution I that highly remain XXXX we're recent want closing, in in say

focus can managing focus growth on will a remaining on business our We with controlling long-term we what while nimble. control,

We trust, will and freight. reinforce, in the customers' their compete our market to gain earn, and

of ways We have are our we value believe over excited about which the opportunities well and reveal our customers, we future. into to deliver course the to XXXX itself and will many

With call that, our the CFO, Kuhlow. like over to I'd to John turn John?

in the Overall, Thank results today provide performance view will our year were you, a plan for for the morning, you I cover recent and XXXX. XXXX. capital and preliminary quarter also the on My fiscal mixed. comments Shelley, for quarter our everyone. good will

were freight prior by in later. as results spite demand As volumes of said, of soft year. pressured an compared unseasonably item the to were quarters operating resilient fairly I'll on that touch That unusual

GAAP from much expense. experienced. what at quarter an and $XX XX% quarter is per a declined X% prior statement the similar operating claims in We but in we income than charge increase historically This the the year to approximately this in a grew as large On we for income larger a quarter or diluted $X.XX for incidents incremental second year per XX%. to amounts settle consolidated charge year-over-year, for basis, certain earnings of rather incurred item incurred million continue share revenue pretax casualty declined have claims share

in we revenue the XX%, out per fiscal ago, full frontline note, a consolidated the record was at year company. performance on the and bonus we grew GAAP million voluntarily XXXX. an earnings and appreciation in bonus XX%, fourth XX% share XXXX, worth income paid on grew the their for recognition out a grew when versus Based our X.X significant, basis, a a for looking employees year fantastic sequential operating year, For contribution solid our not Of appreciation to so of impact to year-over-year quarter similar the paid calling performance. but year

us on capital deploy liquidity to sheet long-term We to strong and ample value with to drive our focus shareholders. continue maintain for providing balance a

Our elevated real demand between levels equipment includes the billion business X.X experienced to XXXX CapEx primarily replacement needs. growth as two X.X contemplates of support DCS, This plan and capital investments and a billion in challenges in result of over investments, last of for for and estate. JBI years; capital

to This note, reason uncertainty a range. to the large the CapEx Importantly ability timing on portion growth component success driven of based contracts. our and this is long-term for our dedicated is secure growth

for XXXX repurchase contemplates market taking shares. Our as our dividend to our consistent in long-term capital as supporting plan the allocation of opportunities well practice, with also advantage

around this level if to are opportunities comfortable turn above and Xx my We our over will present manage going but monitor I target continue EBITDA, This to And concludes investment now themselves. it Nick. will leverage to remarks.

approximately review year. with quarter, our fourth compares good morning. Final segments range private than solutions in our Dedicated. XXX the Dedicated sold our This sold was trucks X,XXX the and target performance for of of and our Mile per fleet Thank operations. the our stated you Demand strong on X,XXX which number update over I'll brought to across quarter. which in truck to X,XXX and full-year focus you, third the to sales John, professional trucks, greater just truck of start other I'll remain areas we outsourced as

in year remains the time seen opportunities we today some ago, backlog moderation breadth Our strong backlog. have the more with in pipeline but the versus also of a the same

downsizing in declined compared our improved, result adds because units on third of net of trades also some equipment as to our Our business quarter largely us availability as quarter, progress truck the new match as but of customers' the XXX levels. to making a our equipment fleets

CVD process of supports our our our for retention optimize This Customer discussed customers, and well As present or growth Delivery, supports customers. our ultimately we savings opportunities as through rate we've fleets re customers. to before these opportunities optimize same XX% with as future Value value our

the remain we business Going ability with in deliver for forward, our outsourced superior will engineered demonstrate we and solution. of strength our this customers confident as our resiliency value highly to

Shifting achieving through we level market. and the will making in this for growing] working needs investment improving contracts further of the growing [ph] profitability appropriate compensated the the by segment the fairly our focused [actually of value to on business profitability to We meet Mile. deliver, we needed and of Final sure are support remain customers

be line performance top disciplined put our levels business with on risk equipment and segment. we the appropriate our commitments influence channel. willing bulky the achieve suggest, ultimately moderated to products, including some to to remain retailers for discounted fulfillment strength price furniture continue seeing in our in the has could in at off big will of as We Demand profitability, and which inventory appliances, opportunities lots with might exercise business have headlines the seen of and but

professional around update my continue elevated comments but in cost. operations. we general areas retention, driver improvements on to some to with recruitment Closing last at see quarter, and Similar

availability into our of touch a elevated in OEM equipment largely XXXX, mix, maintenance cost bringing more We remains the are company. but a optimistic as third in across about a result

remain strategic We performance, this performance given area the but industry company are across is doubling our cost on on elevated in initiatives down experiencing. safety focused to improve the the

my turn Darren. to I'll so concludes remarks, That over it

was Intermodal Nick, I'll the talk and call. capacity of our value exceptional quarter business Thank about opportunity customers you, and to hello review our and in and deliver seasonally and the as activity the to to performance performance capacity everyone our on weaker up start for in was the beyond. the holidays XXXX I'll quarter. absent this normal year. Demand reviewing the by in Intermodal to leading PCs than

rail were also October, down transit in improvements on December. still Volumes a on modest in can times in some decrease for believe year-over-year detention fronts, and will the the and by saw progress which both improvements quarter velocity velocity We November basis. X% see in improve and quarter down customer said, in X% up in we our That in X% further of declined X% and equipment experienced we sequential system. further month

around us velocity that for and opportunities present sell in market. believe product the trends valued reliable current We higher service a to

think opportunities product. we we lot a of to about service XXXX, Intermodal customers leading value with As our deliver industry to our see

Shelley service shifted on costs more customers capacity. their focus As have versus and discussed,

carbon gain [import wallet to by our freight by further and domestic customers share money customers still to have product been into freight see emissions We freight containers. believe savings, international with our to service converting highway which by we intermodal, and and save more transloading opportunities reduces [ph] while converting supported presents weak, highway is volumes] their intermodal back cost our costs opportunities fuel

capacity as in we rail expand and to bid in current we our capacity. commit customers best Additionally, service solid improvement on based our to the are season through our more position the investment intermodal progress to levels

anticipate thought I'd here. Finally, I this being question, address it because a I

aware, committed to both intermodal Western our growth better service capacity are have our you and and Rail have the we alignment we collective BNSF, with As long-term more offering. provider, of

capacity cost our our of will market in basis We customers' service and feel business compete the and our ability we in share. earn and to the on confident grow wallet

do that value We with drive of but guidance continue or to of the business historically approaching our greatest our saying, have are margins and to the eloquent price, streak, and long-term. a XXXX versus any This over volume our mentality, was way we will not not the but we business compounding also given long-term. set-up growth my returns volume on we the over managing how shareholder price streak

prepared concludes That my remarks.

So, Brad it over turn I'll Hicks. to

and I'll segments, Thank an the Solutions continue Highway J.B. performance solution. platform good and to to XXX see on update Integrated with Highway Truckload of specifically Services. we our a on-behalf our call bringing provide morning, customers, review we drop everyone. and without scroll, collectively for what trailer the Capacity how and of I'll drive you, Darren, Hunt whether value together Solutions or our also but

XX% a ICS was decline line with I'll revenue revenue of ICS. in in and per X% top a XX% load. down volume start off decline comprised

or on season. volume pressure volume peak experienced business volume is in unusually Our truckload and our fourth We Transactional year-over-year, XX%. was normally spot but was demand volume slightly down contractual up transactional and the soft considered down in was the year-over-year. quarter contractual were truckload as quarter what additional during

atypical. is and Maybe weaker fourth there demand in was said no the the versus third quarter, actually quarter peak which was differently,

our customers for As remains the us scale allow to that exceptional profitability, platform long-term. investments our in influence line, and in market. past, people our top our the goal will deliver and platform did make which J.B. the Hunt to leverage we've remain discussed our business by our Despite our do our and shareholders value performance XXX we over poor the to outpacing on our

believe demonstrated continue to Volume holding was in Shifting in We freight evidence challenging we that their Hunt quarter. capacity by year needs was drop truckload, drop while quarter. powered by in environment we the prior continue market, overall which trailing see J.B. of the the up and provide versus platform quarter, can relative customers in of the demand believe to to for X% blending better increased leveraging the JBT our trailer XXX. we see value capacity the live

return appropriate up on marketplace we We and that see across will execution, disciplined our leveraging capital. on growth investments As opportunity we XXXX, J.B. our minute business. people, XXX, enterprise. supported make wanted scale earning value sure take digital move runway solid entire understands I on Hunt future focused technology, our the the in investment drives of XXXbox community remain to investments, for our capacity and last Wrapping and a into the our by tool freight that here to is further a to long

us see provides in as us asset-light we we a allows to leveraging to freight For an drivers hire example, results and to able source and source fleet as customers. ICS of our almost equipment. and run obvious, in JBT provide to us capacity I non-asset more for the and on-behalf party or believe third our prop-up you It systems data it or business capacity. startup DCS, are backhaul opportunities dray allows intermodal unlimited

collectively truckload my asset solution network, and a [ph] live large on we are or by Hunt transportation That customers, drop [spot brand. be our by highway representing that one needs the of backed concludes provided J.B. only segment the Whether could customer largest historically load] JBT load, for system the solution a unload is the North American trailers and ICS comments. our live market. carriers one

So, I'll give the to operator call turn for instructions the opens Q&A. Brad it to Delco before over

one Thanks, of Elliot. per in Thanks the interest in just Brad. question we queue. And people of operator, the number we caller? have Can do

Instructions] Of from comes [Operator today Citi. Our course. first from question Chris Wetherbee

is open. Your line

on sort a could ask talk know the you, major outlook the, relationship the Good as as to has increased to with intermodal the that that of and you pricing you, different onto Darren. macro a of right of and question intermodal finer seeing sort in your of don't way sort have potentially for convert [ph] the think XXXX you I we're partner truckload, sort receptivity of customer loads the guess you been year say macro in this to to rail but want think Hey, morning, a opportunities I capacity or can [sitting back the the stuff I about guys. question point thanks. versus, maybe Maybe for for of intermodal, do a of network? as of of the historical beginning a here] you that year volume you lot now? about, what intermodal be wanted get with sort noted, outperformance relative just given West, that maybe sense some the setup

Sure Chris. question. Appreciate the

intermodal. are should I think be positive that highway universally customers our business re-converting towards

to quarter back. to me get your think prove need think I and appropriately quality and length are we J.B. saying, every like BNSF to And customers. you're they I that on to with confidence velocity aligned continue months I I rebuilding now than my it more service we're in four to mission. our about BNSF, team Hunt in cautious you ever hey, talked have that at going say

it are way carrying Our even and And for improves, as inventory to a costs. velocity money, them save intermodal looking is ways money. for save customers in to helps

opportunities to intermodal interested so, of converting customer for us, I a I'm to telling there's us in talk know about of to intermodal. And certainly, don't and lot growing business a continue not

year acknowledge and but think board, I at I in to that want improved is customer proving we the busy will quality improve least a service on. customers do velocity our bit to the process I lag there's the a continue of the to that are of base receptive, think across very and has goes as

the point where one to clarification, needs proposition for service that just rail BNSF customer? be And to the of just it value to make

far our would say, service since best first is the I Yeah, quarter so XXXX. you early, of in the been know, but it's it's rail January,

to And but where is in sign. positive fully, service not the today. so, rail We're massive want that's there a we be to quite really improvement

you Great. Thank much. very

Jon now ISI. turn to from Chappell Evercore We

Your open. line is

morning. you today? own to How Good fluidity when on no, your in think you [Indiscernible] you turns adds of investing the said of you're on own investments, since Darren, about service months an on next turns. kind kind capacity, you. alone? do X in next Thank into is obviously, just over but and be more your months? the the the the your to can best you, network you box stand probably there's commentary sticking box Where box XX much XXXX, just turn think own with what importantly, give it’ll us of productivity, the where being XQ that velocity, the outside X capacity update your

Yes.

So, daily. it's a us topic for

box nowhere X.XX, weakness velocity, to a bit are, created realities unloading, transition be. expect were host we're when quarter a in The Our customer of of ratio. turns in the period we near them turn in fourth where our challenges,

come we and container lots in productivity of a our we back to normalized more for process, have gain get scenario productivity velocity fleet, into. lots dray grow out capacity As and that fleet, the look of into with

opportunity of don't a as there us. in the have half second I fourth containers the to the of you our season terms out in serve the quarter, in how improvement peak I number give confident for a in to a velocity. customers' year, of will mean our ability That's return we're an to come in be many extremely needs shipping.

back and we'll in it purchases, our but to chain XXXX, be our XXX] in we cautious for need the say will sure be I on a we'll very to long but looking be we equipment can keep least and onboarding at have that effort moving direct volumes in a we march probably that our And as we're [ph] is, on and be sure. supply ratio [XXX What getting future. anticipate part turn accomplish can as and we some, to would container we the not but fast grow open with to to I'm

to Group turn now Wolfe from Research. We Scott

is Your line open.

Hey, morning. Good thanks.

intermodal. with stick So,

in more we've a think XQ So, turns expecting box in have parked to it you I containers and ever improve. QX guys than sounds like you're seen

Do then specific for adds the directionally. So, think why on grow intermodal how about to don't back Do just think some want negative just maybe but this overall going guidance, aren't any Thank you I give you you. you And guess to think dialing you I you container you're volume year? earnings? thoughts? And year? this revenue know do positive of segment Darren, directionally

certainly your to expect Well, get not to I be able do all me grow appreciate on volume. intermodal We're guidance. year I attempts, on on fronts, to give earnings, Scott, that. Certainly, revenue, do to to going this on

come I that think the as lag. out is there we first a quarter, of

see can our at summer of the moment. the inventory in and is in year. about the import there rest mean, of not You on. it customers, Most the correction going demand are optimistic a all, economy. significant if I lag There's an

We in have grow market and now not working soft the the ignore to is QX we're that day. Certainly, and fact business intermodal real our opportunities correct. is that we're every to inventory to trying going on right

to year. to going I been much a is, haven't it's brought equipment back of as would really we're we about our really, more certainly far this any meter have we're we little announcement lot onboarding has say bit a over As but than What how as capacity market. made zero, boxes, velocity where really

We Long from to Stephens. turn Justin now

is line Your open.

to on shift question I'll morning. Good a dedicated.

some size in fleets also about with additions about the could thinking new net then fleets? headwind business you how both target got a year? the you've Nick, pieces and reasonable And cyclical quarter but of this looking we've for fleet won, pressure, additions their moving you you are a gross fleet much of talk So, reducing how XXXX, fourth into from saw maybe

Yes.

say, a primary of we given that look did handful I at would a some we've as not making we was a some pick modest, signals reduction thing that So, at we're there were we and but of and lot up so few starting early felt a that. new The would back were more reducing carrying pressure, lot, fleets trucks just reduce QX, I point. accounts addressed some we and older this to headway say really been in of trucks

there reduction. So, some that the was primary, was but fleet

what going stick we're our to with range. XXX said on we've in the guidance on X,XXX to Then sales

Our pipeline is still full. We feel good.

I would part but trying what in we going first in what's of from hesitation that call out year, are that We to some deals. there the just the happen to customers the are are figure signing still experiencing deals

so be get X,XXX sell. already not will So, we, X,XXX to XXX yes, correction, as XXX that we we available. X,XXX to would we the X,XXX, trucks X,XXX adding have equipment sold to Also, that we

So, we that some momentum side. have on

from next from comes Our question Mehrotra Deutsche Bank. Amit

Your line is open.

there's just cost to ask from if and about the Thanks, side think And John offset to operator. Hi, just the ask continue million wanted That's just business to see team. how I enough efficiency to on more great everyone. understand for to Kuhlow, intermodal to then can trend payment. wanted X.X about trying revenue as pressure whole bonus I yield? opportunity yield Darren, cost do you the moderate? in think you I'm

segments if of Thanks. you the taking across pro-rata is that? is wondering about, it that's can Just one or lion's talk segment share there

Amit. the So, Appreciate question. I'll start

productivity. I exit think turns focus driver to calculate. said metric have that it's easy and we improvements real the gets our velocity see most that Box in form there's system in cost and of long an to of because the

we can productivity element as our cost grow improve also more driver normalized that our is and our volumes Our significant a system. get into inside

are The faster. cost are of takeout. customers all operating unload which railroads beginning some equipment to creates faster, Our our

expect XXXX. for to said, feel and sure. grow margin pricing for grow We're confident to we in grow strongly that that kind XXXX any, to long-term really volume, earnings Kuhlow? looking we pressure. expect we in of expected not So, can area of kind We overcome any, feel as our to our revenue business, that deliver we can and guidance grow we change in

we'll Amit. good like Hey, to question, but so second feels it's It you. a it topic, grant a

drivers, all appreciation the On but bonus, then office. our includes and predominantly that technicians also employees. frontline some That's of was for

it's we Dedicated of I'll [ph] million] where JBI rest the and the give throughout is primarily of our in other have was another So, segments. in That's and was X million dedicated X Intermodal drivers. and the most you segments. the [X.X, the spread

We'll now Morgan turn Ravi Shanker to from Stanley.

Your line open. is

morning, Thank an you. Good ICS everyone. Maybe question.

guys see I or think in to about to out weakness that What's you continuing the the playing XQ walk clear XXXX? not that step going XQ walk very like? not the XQ] XQ? you of lack think peak of were a Is down as do expected we demand because of sequentially do How as [XQ into to much season. looking [ph]

for saw a pivot word We thank used to comments, at question. the the morning Good I from And prepared throughout and the that my about started QX quarter, and in December. that atypical. out. you we fourth into continued certainly end I that Yes. of saw weakening talk certainly the play October

As we just would XX, now right sit December. with say, saw what end I here consistent January. in we're XX days through of we

with However, quarter into going resets. inventory expect third as we second maybe mentioned, sometime do Darren quarter

and will our We I area that documented and do the would this feel still see volatility we've market of freight it most rebound, discussed sits where about was. to fully expect the but spot the company that like what long happened in market is the feel

to I imports we'll we flowing, that be fourth think see a demand brokerage. rebound And comparable we some saw freight what of start so, in in the in environment quarter until

comes from Brian Our from next Ossenbeck Morgan. question J.P.

line open. Your is

Hey, good question. morning. Thanks for taking the

you're it a you general and like expect on of is elaborate on middle then demand quarter more year. bit, little first side it seeing and maybe Shelley, little of improvements, bit a caution tough the the the seems of that some towards a can part the sort some touched on So, we've the but you view

to the Darren, So, side, that you enough West from service it think East from be waiting in you and the capacity your does that side also to the that customers to demand both side service going from confidence and of and going the really and a commit lean demand and factor there does recovery the the like key Because timing are the be on for? is here. seem give

Thank So, you. thoughts curious on there. your

just Good morning, transportation our and was where where have that helping them pandemic and Brian. we're did being the with through whole We perspective. they're and theme a use at at we the fluid, understand from word and customers

We also discussion. cautious think a some were lot talked demand about And starting being the last in were of see. those we the trends to I

you fourth we're And the way activity quarter, all saw to continue port decline If the the in December. look you certainly, into from feeling impact that.

through Darren As quarter. we really is us and about. to there both an have all that heard talk customers, happening have first you've talked And they shared occur Brad to the correction with inventory that that's expect we to continue

about what up that points going our to year, more We're what half do having the data ordering a customers We a back we doing sure and feel at not an the good from but us of they they're more from customers perspective. from in like we normal starting are had to is back our giving QX, normalized QX signals the environment. point have or have, that have be confidence what

the would recession half in that total. see of And services. Brian, the season all customers The so say, we now freight I right see think don't you inventory thing last from if our bid largely about then driven. else anything is in of We intermodal occur highway of be for year back all part of should really one-way the the Those and loaded. this company fully business, our in

bid of if really when results planning. bid will, season know drives the about do you to what's a July So, what that's a really going and if is we that's we're And you season. capital what X, from think happening complete in

the part in So, that we're you of going fluid be process. heard Darren to say,

equipment confidence how highway We our around much what's highway in have to in services. inside our intermodal space share to that we about talk customers continuing feel there. we and strategy, saying grow Final the converted can And we And win dedicated our are would and Mile onboard, would to happening I I add, confident flexibility our say, so then ability confident but season know what bid feel well. you Nick about I as heard our

I to in, just want jump Brian.

to we're in CSX as significant to back You providers, year Southern in this bit Eastern are of to they little Norfolk XXXX in intermodal grow asked part you hinted see really Eastern – have rail than and of and their opportunities continue our network railroads, also conversion in on. performing a plans and better goes both and highway at that confident share

now Tom from Wadewitz turn to We UBS.

Your line open. is

Yes. something wanted see I that think lot supply I'm go about should in Is think Do you seeing ask that storage, do what it's in revenues? particular there's a kind storage happens in that more, stickiness going And it that. container XXXX you. in thing we of you of storage intermodal? storage And think revenues or a revenues thinking gradual quickly? how sounds a impact I a with revenues? down bit just you Thank you you're does happens storage that that the fluidity, that mean, fairly improvement bit beyond if there's be to chain, like to in

and We're get think demand I kind system do Absolutely. chain supply itself? today. mean, of better I to that. that weaker allow take that will the fluidity I'll the reset in Sure. experiencing with

Our their customers are infrastructure port up for set is accommodating imports chains the and today. better supply

moving more fluidly. And so system is

that it to to relates way depends. only is revenues, As that the storage answer

every faster, shipments decline but up month that then more operate on those unloading there focus frees today. container are streams, in and that's our customers our revenue be as to capacity will long As a that

us just our continue for can our business. our customers, you'll to system grow that to talk value provide allows of about come which and into faster hear cost why That's real us translate can out intermodal savings

from Our Jordan from comes Goldman Sachs. question Alliger next

open. is line Your

think morning. the you I Hi, one-time an Yes. if give some of like is business on claim was color us rate expense, run little I do – ongoing cleanup wondering mean, various could more casualty Thanks. nature how a on or through this of sort sort segments this we about, basis? it. the of is a this

last the on similar the settlement John XX dramatic Yeah, this our in months that. experience address to others months XX to Jordan, seen a is claims. our in I'll over change Kuhlow. industry We've

claims but claims, historical much more experience. levels higher most are of than our our settling at importantly, All severe our

Sometimes Xx ago. what five they years to were XXx to

in on fourth quarter recorded the for the claims. And exceed have quarter And claims to the reserve that represents in so, caps, layers reverts when And us. coverage we our the current the consists in those layers second of XX a insurance our are we million that in that the million XX previously adjustments certain of total there expense caps. recorded year million incurred there and and XX

So, these that prior experience. reserves on our we've claims all based increased are period our

will I is for we've tell that, experience that going because this you With it's dramatically insurance up. our environment. claims the the unpredictable And claims costs why done a reason is highly

another one-time not in We unpredictable said, for charge. I to XXXX planning But continuing claims. are as and we're watch it's highly our

that Now, to tell we going XXXX. changes our have you made some I will structure into

this. and more coverage going so, be contemplate And are taking to we on to

than deeper is because bit little a a focused even go that this we area I'll normally do And on. significant we're just

think also as to of just the so a up increase. premiums new rate be in premium mentioned, will around on core But base I going premiums. are I our basis, layers and we're XX% on our insurance adding

said, That because are to on what just in how to these, our today much the claims movement losses the expecting seeing next as on as we're settled. XX% increase XX% of these year being incurred we're

than seeing we're a give wanted deeper a what little insight the bit bit insurance would So, but little normally area. more we in on give, you information to

We now from Barclays. turn to Brandon Oglenski

is line Your open.

think question. yield in either. and with the tougher that earnings truckload pricing Intermodal morning dynamic good reconcile this could how spoke you [ph] you the that Hey, impact and times [Now of market can about year, I Darren, items in your year? generation a growth couple specific there thanks just for for looking] this

real mean efficiency us end we our pricing want for Well, cost to out of save the day, there's but come is Customers to out with system gain I of money, pressure there understand at and growth. the there. real again, to

strongly we we a more into intermodal we be we we're to the to grow opportunity may that but same really to as per there more loads shipment, And have. assets business, and out, It grow move do we're then so, income is continue as not to grow if drive income cost our way executing the with forward our to going volume. shipments able some the translate find as

feel goes which communicating we our really goes is displaying out growth turn our has really can a improved And bid to can improved out like income we're that's the season this business into to truck and mission, and in to significantly, is. velocity has as grow get on. service what as get will transit and year the as customers that product closer the ton and We transit intermodal

turn to Poliniak now from Fargo. Wells We Allison

open. Your line is

morning. good Hi,

Just Mile want dedicating, to the to is this get think as probably back Final well. to I applicable

maybe it cost need, thoughts On new equipment needs in equipment side, any that of going to the demand in, accelerating is pretty think some this the that quickly coming year Just down are service? kind keep aging we consumer there. of still of or should less maintenance customer

kind our goes Dedicated Final going still Mile. year. OEMs, this it to think of Talking be Well, to Yes. they're through and fleets, constrained, Intermodal, all they

at due end And But that part year. we the year publicly that we be some on a numbers the most we're some few that move forecast, us of announced carry will have those that this OEM the are based to if OEMs going of up. with us will trades so, our could a hundred to third past but going that alleviate still will of forward come we're the handling trucks we've constraints, help

comes question Hoexter Bank Ken from from America. Our next of

Your line is open.

fully season? comments you season I was Great. think we bid Good there by some that noted July on X. of Shelley, bid morning. revisit loaded the just can

industry bid and how weakness are talk May the New is up, fourth looking a levels? stands into I through guess outlook of Darren, the business? you're So, if part season thinking Brad and then where Maybe still versus spot And Year. for we each it about maybe contract demand about you quarter can coming at about March talked you've

would end of Hey, I year say implement the to about morning business portion in X. July that our still Ken. to as look the July bulk of now the good the revenue and going quality, a be we'll our between customers X all We smaller from in our implementing are have business general July but business, plans. think of growth that year, tend at the how next through X the we our we way through

changed at our start, their year, part, we we've a do We are if from I'll largely Brad and few they're a most for mid-year. and some what say bids review but for customers bid that have I else calendar Darren might comment of And the have budget Although full-year we there. would historically seen, the with in-line. in-line anything what's happened customers season actually let at a there's

to Well, versus the on I'm going spot Brad Speakers]. ask to comment [Multiple

I'll meeting feedback used there, We're of still bids focused what it strategy get can't very market may or volume terms on a seeing are necessarily optimistic expectations to and early in in if make and the or return something few comments And we've that here. our Ken, our it if The so, we're we in what back Is our what be? does seen is season, business. it months of that contracted clearly when bid on early winning contracted and several over in spot to count it growth but and about does, last we business. when less?

focus. from So, that's on the – highway, a predominant our transactional side, on

of and that spot much. from will move They in as highest end nearly play would standpoint published a versus don't us certainly anticipate little a around percentages in I highway. past, years what's I Intermodal on we contract market of think being versus spot the the spot the different.

Darren And so, I'll comment he's maybe seen. what let

rates, we'll significant Well, difference case but a to Intermodal and so saving to and contract the I there'll has providers fuel corridors inclusive. that's and forever no continue for look our business time, our at try in going case think that And that we're prices we'll most should that be been contract provide against forever rail to handful be this year. be ways some competitive, we'll and pressure of returns there's prices adapt think our may same about can highway to our there about customer I and where take margin systems our their at cost talk intermodal the markets be to level of we truck the the profiles out applying watch Hunt. around everything Certainly, at been a and disciplined out of spot J.B. highway and and mix

from Markets. next comes from Our question Fowler Todd Capital KeyBanc

Your line is open.

Great. Thanks and good morning.

quarters been different a together. through How maybe throughout we in. like we bringing contract earnings that has going expectation of as it couple there's the and call, shape just the to touched an inflection quarter, first seems It move this on ways but environment of about the is think but going I do come time, at mid-year, XXXX? pricing some volume but is the in to the start-off weak for think same

some the do we weaker you that seasonality? inflect can demand And are have environment the think about that cost up, So, what how levers demand? offset then Thanks. of if doesn't

Hey, Todd. Delco. It's Brad

three question. statement general one that about before, the Clearly pleasure play. last haven't to this would demand talked part elevated say the responding hit levels on come really don't in I of seen. of One, we me we've seasonality is but You to seen seasonality fortunate better maybe years over we think provide that two we've and back or the based just I guidance,

You saw that the in fourth quarter.

don't Hicks’ and a comments atypical In demand weaker than What after you that, from expectations ball visibility here have least we any at was a the seasonality crystal heard environment fact, than have say, I'd actually we isn't lot changing first – that suggested comments quarter. fourth of in Darren’s probably what quarter also happens think saw just really demand of QX. anybody terms we I else. from Brad much perspective we in I think where there overall

our year guidance in you the So, interest. how more not I probably be plays think on detail best would any and giving out

to turn Credit from Ari now We Rosa Suisse.

Your line is open.

just taking M&A, that to a it to reference to that, John opportunities Great. leverage leverage? and sort and might press right bit a the I what be for that was if would about wanted was else thinking to of that it you understand willing Kuhlow be Good opportunities. a would types are or take to mentioned M&A that justify to up something you comment of reference if of reference more a if that on little wanted ask, up the I morning. guys was

continue of look as me, at in excuse Yes, do buybacks of are was our at or of referring take opportunities the a there capital to. well. sheet, anything and on liquidity to buyback specifically and our But our that piece to was the I still advantage we'll strength that We position, as becomes continue core ability allocation also available it more balance dividends and just we'll to wasn't so. commenting evaluate exist. that M&A process It

Our Majors next Susquehanna. from Bascome from comes question

Your open. line is

the your through went the versus partner suppliers [ph], learned some with the competitive and business? you stay rail and intermodal or with the inflecting your desire competitive their you Schneider about leaving moving strategy [UP] long-term customers BN Thanks. your As us bids to to that's create you what maintain competitive how can over some tell tension to grow perhaps in

significant them. have share details taken customers that They confidence want service on maintain to in with on they know through our have that enough them So, hear that that. Schneider the our ability to from a improvements I to and ability to talk BNSF. yet don't we the have position provide has strong our universally We really a capacity

to was think I have doubt no base operating anything we of our backfill BMSF. capacity customer that So, on there's the out Schneider

customers, topic take right be not a intermodal it's look customer business. not, of first might Schneider's the handling into competitor that and to top their where when our on talking of mind the the business? hey, and is you who solutions we're also regardless Our network is to process with It's solution for go the about talk subject can

have think to trying out they in just we for we're solve customers confidence and real us. So, our

talking together, operations Schneider in means collaborate we're that to talk a in we're terminals, way the the I about together. we the exit we going how market to how think how BNSF, ton

exit Schneider to And way a that. me BNSF customers will the So, in of communicating like our to out benefit BNSF. the I'd with significantly valuable we're believe from get is

comes from Our Cowen. next Jason question from Seidl

Your open. is line

quick morning, Good everyone. from one operator. you, One Thank me.

they rates You talked largely, They've the we're but and expectations truckload guess X% on starting are intermodal expectations held think carriers from up pressure I do that between growing private anywhere how a side for let's down? little and year. might it that. bit put this some about about on contract call where some you X% here

if downward truckload I'll or Jason. maybe expect I I rate shape, on form, side way, might seen start, see to you're then understood impacting And think asking Intermodal how rates, we and certainly the side. We and contract think about any we the that see what in pressure question on have about highway correctly. the

the to sit and ICS The light flow more in with good we with favorable is and we're now from when combination fluctuation a evolution where we ebb our line are much than our of that JBT, in so the on and variable part of news we power and perhaps were it But truck certainly were the we able saw for we're substantially three movement, or we up on give to to not planning or just know the substantially to do be we years as you go it overall we ago. anticipate abnormally somewhat an down going but provider. on for somewhat two what expect guidance I'm fully rate what we expect, asset most

kind We are downward. seeing that correction of back

to today. different the a to savings thing it'll the the pricing, on for happening in Intermodal customers is price our don't think not certainly I and in particularly long-term, advantageous a whatever when offers Intermodal continue continues will you for in cost the contract significant and be be for add truckload fuel truckload Intermodal there. but of customers, now the and against to becomes point only any that front, talking historically a outperform going intermodal a the say think ignore is, truckload for would our I dialogue then I and I'm rates. downturn be will

next question Chan Our comes from Stifel. from Bruce

is open. line Your

you, for Hicks ICS. on everyone. the morning good Hey, Maybe one time. Appreciate another Brad

your a on you in [tech inflationary? volumes this more release more opportunity an bit was more little around in investment that of whether much wanted about bit I year, structural maybe XXXX. talked to was And the volumes to a in the that about just pickup whether think you do And platform have costs] know a whether that you on some a get tied of You directly was get in costs? to or you. [ph] in color as that leverage business, comments then Thank those how

Thank to some point the was as design, of finish of year by tech we've was continue to Really both in and our was that to JBT we of investments transparency look ability made the from platform it our gains you, step-up and Part it both focused our visibility that Highway. out a both people carriers Bruce. and productivity that prior just better our for get at and making from also our on shippers. for ICS

move to And there's so, do feel like upside forward? we we Absolutely. continue as

We've on about is benefit business, tech of will think blend our to which platform, the we've All has us execution the our overall [ph] still those investments to expect us technologies work business the would started it there's enabled XXXX, for about live versus the of but last freight] quarters, talked JBT. of help to in how inside as and productivity on of few ICS [drop Even really business. about freight further be focused realize done. if you we been really historically what's think those that out we build

benefit better and low efficiencies And drive make a a we're to through help can The through cost. be our that service to decisions. improve ultimately blending, then able customers

improvements what that's our So, we going expect and continuous into throughout. focus to is XXXX make

from question Kauffman final from comes today Vertical Research. Our Jeff

Your line open. is

apologize I you comment go [nefarious] in weakening inventory a is economy to in. going the me kind consumer of to of to customers be the we just inventory where how of or going better they likely weak something we issues guess be in more to to weakening? terms correction know related. in from, XQ, when for mostly not this, back want of about reductions, used bringing you are the inventories [ph] back customers on is done? numbers by the is weakness these and I to to much. inventory a of beneath two big the starting JIT inventory very set and were related Thanks And buffers built case. know on terms went in but prongs a how still inventory these driven as get do I it's the Shelley, sense chain supply this your all this Thank squeezing buffer talking then, Is a last year customers I to there that because for adjustment lot really, is have or

what really Thank Brad you, with and is talk Jack. inventory to It's an good said, but telling will And like us I correction largely crystal difficult, customers. ball else's. like to I our of consumers were last not do think they're hard coming start they're was we COVID, the and very is what is part future. And and our an talked Delco they're that not on we're anybody as it's what which what also happening. capacity quarter about occurring buying side I inventory say, Brad the the around back into really flip but of from evaluating side, is Hicks that end purchasing the flip moving

around a an That's would confident, We customers good that But part are from that Jeff. great perspective. apologize, fluid what and It's making have this conversation ball, crystal Jack. our but have we don't is to Jeff, telling in know say, what's happening not that feel we sure I we're I be of inventory but correction going us.

I'll now any hand Q&A. our over concludes remarks. final President Shelley Simpson, for This to

but but on it really here seeing lot J.B. we're heard for And being and so are to to also a the also challenges hand our you we think much. but very that and demand think at to Thank also ability presented, cautious on talk Great. are you the about I'll back in opportunities and this We're we to customers what be I exist fluid for thrive our Hunt. and side, end, John any the environment. the in us continue in going we're open based environment that confident

this year, years stay decisions our talking disciplined whether our about year, priorities, around three people, capacity, really with and the that's and long-term in after. next customers. and making investment being to close our don't our going fluid those stay We're technology, sure or change our with those we And

will We this with helping on value. year, we very customer And creating focused customers our cost are be savings. more

efficiency. talk You about we're to heard Darren through going do that

a Mile to about We're efficient them are into a the fleets the going efficient lane leverage Intermodal. differentiate more segment to and to great solution. capacity cost Hunt our them and to transportation mode create customers' going talking most flexible fleet. continue in conversion, build also We're for we're bring going experience J.B. to Final to We XXX available and to

going Finally, I so sure before years, three continue want we returns are effort day for have trust you and notice, tell to that but it bit the customers but to turn delivered our to to the our every us, that are XXXX, to shareholders. over noise but XX,XXX employees three compounding hard their be very our have John, really little long-term our of work quarter, the our we a there, customers people in that priorities, last make trusted fourth have Those made provider. of I'll are through even I that I we proud say, over over

We irrelevant. customers, people, accelerate want capacity would continue our technology to our with be to and really but without

so, have to can't the emphasize teams of great forward And proud teams our and I enough we're XXXX. looking work John? done. We're just the

affluently, is an way I'm stay if close gotten of with even back say [no keep I to it worries] and or of think very position that a to comment lean he be of eye here into attention. and the fourth Great and that. to want a wanted the changes has because We you. the that's maybe Thank we're current in us part that go John's little surprise bit business, It's noisy our to XXXX. good confident our [ph]. this none that plan making to kind on just there. and continue like about to understand Shelley. like more of a adjust approach sure this event all tracking And Good, [indiscernible]. to to claims

I'm OEMs have worked Nick mention to a position the want the super as OEM position we're that right to and now, with the strategic I company I very help better confident that buyer. in. in

And of are our a providers our and X are that. very [indiscernible] Class different buyer. We really management understanding types and Class X

us. I really value think good for positioning long-term that's got a

confident to those close being been very job I have our I've work. providers see aligned very us. I'm ideas with my a near-term or and long really ever them, rail additions and I positioned seen. said, are about And closely march seen have prior relationships I've would very, appropriate, are as also equipment how to like our questions say this And job good that the is but we those what able never in like and as in this either I Darren

term of And going corrections. I be advantage will kind taking into XXXX, we're to we just XXXX, leaning forward XXXX. those so, the think of And coin

has easy. and the in also of proud one My same no of of close XXXX, far XXXX, Shelley’s. as No and thinks so forward been when particularly I as closing as I'm of word XXXX any on in is really not has the It that to great opportunities but really, I'm that it what people, happened our proud all industry, we has look part gives am out of claimed proud one happened what capitalize leadership. ability our we happened in to the what has confidence me our here. particularly go but

we'll being next call talk So, to we quarter. the and on you appreciate you

thank This like We your now completed. you call participation. for is to

now disconnect your lines. may You